PERMASTEELISA v. C. John Anderson, et al., Defendants.

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

PERMASTEELISA, S.P.A., Plaintiff-Appellant, v. LINCOLNSHIRE MANAGEMENT, INC., et al., Defendants-Respondents, C. John Anderson, et al., Defendants.

Decided: March 31, 2005

MAZZARELLI, J.P., MARLOW, SULLIVAN, ELLERIN, CATTERSON, JJ. White & Case LLP, New York (J. Christopher Shore of counsel), for appellant. Law Offices of Sean F. O'Shea, New York (Sean F. O'Shea of counsel), for Lincolnshire Management, Inc., Structural Products, LLC, George J. Henry, Douglas Bagin and George Armiger, respondents. Dreier LLP, New York (Jeffrey A. Mitchell of counsel), for Elliot Kracko, John R. Barker, Emil Z. Sher, John W. Nord, Luis J. Morales and Stephen H. Surman, respondents.

Order, Supreme Court, New York County (Karla Moskowitz, J.), entered August 2, 2004, which granted defendants' motions to dismiss the complaint, unanimously affirmed, with separate bills of costs.

In this action arising from plaintiff's purchase of its largest New York competitor in the curtain wall industry, the motion court correctly found that plaintiff could not show the requisite reasonable reliance to support its fraud claim based on a provision in the parties' agreement acknowledging that plaintiff had all of the information necessary to make an informed decision with respect to the transaction.   Moreover, despite its evident qualms regarding defendants' failure to comply with its obligation to provide certain information during the very brief due diligence period, plaintiff neglected to seek examination of the books and records of the company it was acquiring, relying on an unaudited financial statement that allegedly proved inaccurate, and failed to seek the insertion of a prophylactic provision in the purchase agreement to ensure against the possibility of misrepresentation (see Rodas v. Manitaras, 159 A.D.2d 341, 343, 552 N.Y.S.2d 618 [1990] ).

The contract claim was essentially duplicative of the insufficient fraud claim (see Coppola v. Applied Elec. Corp., 288 A.D.2d 41, 42, 732 N.Y.S.2d 402 [2001] ).   The claim for breach of the implied covenant of good faith, which the motion court aptly noted failed to set forth any additional factual allegations, merely duplicated the insufficient contract claim (see Levi v. Utica First Ins. Co., 12 A.D.3d 256, 786 N.Y.S.2d 3 [2004] ).

We have considered plaintiff's other contentions and find them unavailing.