Opinion
344 CA 21-00205
07-08-2022
PAPE VENTURES, INC., a Nebraska Corporation, Plaintiff-Appellant, v. AMERICAN SPORTS MEDIA, L.L.C., a New York Limited Liability Company, SimpleCirc, L.L.C., a New York Limited Liability Company, and David K. Aultman, an Individual, Defendants-Respondents. (Appeal No. 1.)
SUGARMAN LAW FIRM, LLP, SYRACUSE (CORY J. SCHOONMAKER OF COUNSEL), FOR PLAINTIFF-APPELLANT. BOND, SCHOENECK & KING, PLLC, ROCHESTER (JEFFREY F. ALLEN OF OCUNSEL), FOR DEFENDANTS-RESPONDENTS.
SUGARMAN LAW FIRM, LLP, SYRACUSE (CORY J. SCHOONMAKER OF COUNSEL), FOR PLAINTIFF-APPELLANT.
BOND, SCHOENECK & KING, PLLC, ROCHESTER (JEFFREY F. ALLEN OF OCUNSEL), FOR DEFENDANTS-RESPONDENTS.
PRESENT: LINDLEY, J.P., NEMOYER, CURRAN, WINSLOW, AND BANNISTER, JJ.
MEMORANDUM AND ORDER
It is hereby ORDERED that the order insofar as appealed from is unanimously reversed on the law without costs, the motion is denied in its entirety and the second through fifth causes of action are reinstated.
Memorandum: Plaintiff, a corporation that designs proprietary software used by publishers to track and manage their customers’ subscriptions, commenced this action to recover damages as a result of defendants’ alleged reverse engineering of plaintiff's proprietary software, which they repackaged and sold as their own, in violation of the terms of service for use of the software. In the verified complaint, plaintiff asserted six causes of action: (1) breach of contract; (2) misappropriation of trade secrets; (3) tortious interference "with contracts and/or business relationships or expectancies"; (4) deceptive trade practices; (5) civil conspiracy; and (6) unjust enrichment. Defendants moved, inter alia, to dismiss the second through fifth causes of action in the complaint pursuant to CPLR 3211 (a) (5). Plaintiff appeals from an order insofar as it granted the motion to that extent.
In moving to dismiss the second through fifth causes of action on statute of limitations grounds, defendants had "the initial burden of establishing prima facie that the time in which to sue ha[d] expired ... and thus w[ere] required to establish, inter alia, when the ... cause[s] of action accrued" ( Larkin v. Rochester Hous. Auth. , 81 A.D.3d 1354, 1355, 916 N.Y.S.2d 694 [4th Dept. 2011] [internal quotation marks omitted]; see Wendover Fin. Servs. v. Ridgeway , 137 A.D.3d 1718, 1719, 28 N.Y.S.3d 535 [4th Dept. 2016] ). A statute of limitations does not begin to "run until there is a legal right to relief. Stated another way, accrual occurs when the claim becomes enforceable, i.e., when all elements of the tort can be truthfully alleged in a complaint" ( Kronos, Inc. v. AVX Corp. , 81 N.Y.2d 90, 94, 595 N.Y.S.2d 931, 612 N.E.2d 289 [1993] ; see City Store Gates Mfg. Corp. v. Empire Rolling Steel Gates Corp. , 113 A.D.3d 718, 719, 979 N.Y.S.2d 606 [2d Dept. 2014] ). "Generally, tort claims accrue upon an injury being sustained, not upon the defendant's wrongful act or the plaintiff's discovery of the injury" ( City Store Gates Mfg. Corp. , 113 A.D.3d at 719, 979 N.Y.S.2d 606 ; see Kronos, Inc. , 81 N.Y.2d at 94, 595 N.Y.S.2d 931, 612 N.E.2d 289 ).
Here, defendants did not meet their initial burden on that part of the motion based on CPLR 3211 (a) (5) because they did not establish in their moving papers the relevant accrual date of plaintiff's second through fifth causes of action and, therefore, could not show that the applicable limitations period had expired with respect to those causes of action (see Chaplin v. Tompkins , 173 A.D.3d 1661, 1662, 103 N.Y.S.3d 713 [4th Dept. 2019] ; Larkin , 81 A.D.3d at 1355, 916 N.Y.S.2d 694 ). Consequently, Supreme Court erred in granting defendants’ motion insofar as it sought to dismiss the second through fifth causes of action on statute of limitations grounds. Because defendants did not satisfy their initial burden on that part of the motion, the burden never " ‘shift[ed] to ... plaintiff to raise a question of fact as to whether the statute of limitations was tolled or otherwise inapplicable, or whether ... plaintiff actually commenced the action within the applicable limitations period’ " ( U.S. Bank N.A. v. Gordon , 158 A.D.3d 832, 835, 72 N.Y.S.3d 156 [2d Dept. 2018] ; cf. Carrington v. New York State Off. for People With Dev. Disabilities , 170 A.D.3d 1495, 1496, 96 N.Y.S.3d 393 [4th Dept. 2019] ).
In light of our determination, plaintiff's remaining contention is academic.