DOLGOFF v. [And A Third-Party Action].

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Supreme Court, Appellate Division, First Department, New York.

Eugene DOLGOFF, Plaintiff-Respondent-Appellant, v. PROJECTAVISION, INC., et al., Defendants-Appellants-Respondents. [And A Third-Party Action].

Decided: January 23, 1997

Before SULLIVAN, J.P., and ELLERIN, NARDELLI, TOM and ANDRIAS, JJ. John J. Gallagher, for Plaintiff-Respondent-Appellant. Arthur S. Olick, for Defendants-Appellants-Respondents.

Order, Supreme Court, New York County (Walter Schackman, J.), entered on or about April 10, 1996, which, insofar as appealed from, denied defendants' motion to dismiss except as to the third cause of action against defendant Sherman Langer, granted plaintiff's cross motion to disqualify defense counsel and denied plaintiff's cross motion for the appointment of a temporary receiver, unanimously modified, on the law, the facts, and in the exercise of discretion, to the extent of granting plaintiff's cross motion for a temporary receiver and remanding the matter for further proceedings, and otherwise affirmed, without costs.

 We agree with the Supreme Court that defendants, on this pre-answer dismissal motion, have failed to “definitively dispose of the claim[s]”  (Demas v. 325 W. End Ave. Corp., 127 A.D.2d 476, 477, 511 N.Y.S.2d 621).   Many factual questions remain unresolved as to whether defendants breached the contract agreements at issue herein.   Moreover, as in Mulder v. Donaldson, Lufkin & Jenrette, 208 A.D.2d 301, 623 N.Y.S.2d 560, plaintiff has sufficiently alleged a claim for punitive damages, maintaining that defendants' self-dealing injured plaintiff as well as the public shareholders.   Defendants' conduct with respect to plaintiff was clearly “associated with” defendants' alleged tortious conduct (see, id., at 309, 623 N.Y.S.2d 560).   In addition, the alleged egregious conduct on the part of defendants Maslow and Halloran adequately support a claim of tortious interference with plaintiff's employment agreement and/or plaintiff's advantageous business relationship with Projectavision, Inc. (see, Bank of New York v. Berisford Intl., 190 A.D.2d 622, 594 N.Y.S.2d 152).   Plaintiff has also satisfactorily pleaded alternative theories of constructive trust and unjust enrichment, since his papers sufficiently show that a fiduciary or confidential relationship may have existed between plaintiff and defendants, and that defendants may thereby have become unjustly enriched at plaintiff's expense (see, McGrath v. Hilding, 41 N.Y.2d 625, 394 N.Y.S.2d 603, 363 N.E.2d 328).

 Supreme Court properly disqualified defense counsel.   Not only does the record demonstrate that defense counsel has previously represented plaintiff on matters substantially related to the instant action (see, Solow v. W.R. Grace & Co., 83 N.Y.2d 303, 610 N.Y.S.2d 128, 632 N.E.2d 437), it is likely that several attorneys from the firm will be called to testify as critical witnesses at trial (see, Brunette v. Gianfelice, 171 A.D.2d 719, 720, 567 N.Y.S.2d 279).   Moreover, it appears that defense counsel was concurrently representing plaintiff after this lawsuit had been instituted (see, Stratagem Dev. Corp. v. Heron Intl., 756 F.Supp. 789, 792).

 Since plaintiff has adequately demonstrated his apparent interest in the property at issue herein and shown that there is a danger of irreparable loss and damage to such property (CPLR 6401), the appointment of a temporary receiver is warranted (see, Somerville House Mgt. v. American Tel. Syndication Co., 100 A.D.2d 821, 822, 474 N.Y.S.2d 756).   We remand the matter to Supreme Court for the purposes of appointing a temporary receiver who will safeguard the interests of plaintiff.   The receiver should confer with the parties as to all patent matters.

We have considered the parties' remaining claims for affirmative relief and find them to be without merit.