Opinion
104735/2011
09-15-2011
Mark Yuen, WEI JIANG LI and DE QUAN HUANG, Plaintiffs, v. Yuk Lin Sun, YIM DAN CHEUNG, WAI SING CHEUNG, CHONG FEI LIN, WOR SHENG YU, WOR CHING YU, LAI JEN YU, MAN FOO YU and WOR HONG YU, Defendants.
Appearances of Counsel Yi Wang, Esq. Attorney for defendants. Alfred S. Lui, Esq. Attorney for plaintiffs.
Appearances of Counsel Yi Wang, Esq. Attorney for defendants.
Alfred S. Lui, Esq. Attorney for plaintiffs.
Anil C. Singh, J.
This is an action for malicious prosecution and intentional infliction of emotional distress. Some of the defendants — namely, Wor Sheng Yu, Wor Ching Yu, Lai Jen Yu, Man Foo Yu and Wor Hong Yu (Yu defendants) — move to dismiss the complaint pursuant to CPLR 3211(a)(1) and (7). Plaintiffs oppose the motion.
BACKGROUND AND FACTUAL ALLEGATIONS
Plaintiffs, who are citizens of China, formed the Expo Group allegedly for the purpose of constructing an amusement park in China. Defendants are investors and shareholders in the Expo Group. In 2004, defendants were allegedly persuaded to invest in this amusement park, which was supposed to be constructed prior to the 2008 Beijing Olympic Games. As of January 2008, construction of the amusement park had not yet commenced, and defendants purportedly became aware that Chinese law forbade construction of this park. When defendants sought to recover their investment money, plaintiffs refused to return it.
In 2008, defendants herein and others filed a complaint asserting nine causes of action against plaintiffs herein, and others, to recover damages in the amount of five million dollars. In January 2009, plaintiffs were enjoined from "transferring, encumbering or secreting" any corporate or individual assets, up to $5,000,000. Defendants' Exhibit G. This injunction excepted personal and business expenses of up to $5,000.00; however, it required counsel to receive permission from the court before withdrawing funds in excess of $5,000.00.
Plaintiffs herein and other prior defendants moved to dismiss the complaint. On May 4, 2010, the Honorable Richard B. Lowe, III of this court dismissed all but the fourth cause of action for fraud. The court noted that the current defendants "adequately state a cause of action sounding in fraud and misrepresentation and the issue of whether the documents are accurate and reliable or constitute evidence of an elaborate scheme to defraud [defendants], is a question to be resolved by the trier of fact." Plaintiffs' Exhibit B, at 12-13. The court also lowered the amount of funds to be restrained to $1,000,000 and removed the additional requirement for counsel to obtain court approval before withdrawing funds in excess of $5,000.00.
In September 2010, plaintiffs, as defendants in the prior action, signed a stipulation of discontinuance in which they agreed to withdraw and discontinue all counterclaims as against certain prior plaintiffs. These other prior plaintiffs — none of whom are defendants in this current action — agreed to withdraw their claims as against the current plaintiffs.
In March 2011, plaintiffs herein moved for an order vacating the prior injunction on their assets. As of the present date, this motion is still pending. Apparently, another prior plaintiff, who is not involved in this action, and who did not sign a stipulation of discontinuance, objected to the motion to vacate the injunction.
In April 2011, plaintiffs commenced an action against defendants alleging that defendants "maliciously" commenced the prior action as a way to annoy plaintiffs. Defendants' Exhibit A, Complaint, ¶ 19. The first cause of action is for malicious prosecution, and the second cause of action is for intentional infliction of emotional distress. Plaintiffs allege that, as a result of "defendants' extreme and outrageous conduct, plaintiffs have suffered and will continue to suffer mental pain and anguish, severe emotional trauma, embarrassment and humiliation." Id., ¶ 32.
The Yu defendants move, pursuant to CPLR 3211(a)(1) and (7), for an order dismissing the complaint. They argue that their conduct in bringing the prior action does not meet the criteria for malicious prosecution; as such, this cause of action should be dismissed. The Yu defendants also argue that their conduct did not rise to the level required for intentional infliction of emotional distress.
Plaintiffs claim that the defendants have "refused" to vacate the injunction after "all of their causes of action were dismissed." Lui Affirmation, ¶ 19. Plaintiffs allege further that the defendants abandoned the case and that they "allow" the plaintiffs' bank accounts to remain frozen. Id. Plaintiffs believe that the prior action was "clearly commenced for the sole purpose to extort and harass." Id., ¶ 20. Allegedly, plaintiffs' good names have been damaged as a result of this lawsuit. In their memorandum of law, plaintiffs claim additionally that defendants' actions constitute abuse of process.
DISCUSSION
I. Dismissal
On a motion to dismiss pursuant to CPLR 3211, the facts as alleged in the complaint are accepted as true, the plaintiff is given the benefit of every possible favorable inference, and the court must determine simply whether the facts alleged fit within any cognizable legal theory. P.T. Bank Central Asia, NY Branch v ABN AMRO Bank N.V., 301 AD2d 373, 375 (1st Dept 2003); see also Mendelovitz v Cohen, 37 AD3d 670, 671 (2d Dept 2007). A motion brought pursuant to CPLR 3211(a)(1) "may be granted where documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law.'" Held v Kaufman, 91 NY2d 425, 430-431 (1998), quoting Leon v Martinez, 84 NY2d 83, 88 (1994); Foster v Kovner, 44 AD3d 23, 28 (1st Dept 2007). Under CPLR 3211(a)(7), however, "a court may freely consider affidavits submitted by the plaintiff to remedy any defects in the complaint and the criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one [internal quotations and citations omitted]." Leon v Martinez, 84 NY2d at 88.
Plaintiffs mistakenly argue the inapplicable summary judgment standards instead of the ones for a motion to dismiss.
II. Malicious Prosecution
To successfully plead a cause of action for malicious prosecution plaintiffs must provide proof of
1) the commencement or continuation of a ... proceeding by the defendant against the plaintiff, 2) the termination of the proceeding in favor of the [plaintiff], 3) the absence of probable cause for the ... proceeding and 4) actual malice. A plaintiff must also allege and prove special injury [internal quotation marks and citations omitted].Wilhelmina Models, Inc. v Fleisher, 19 AD3d 267, 269 (1st Dept 2005).
As set forth below, plaintiffs are unable to prove that the prior action lacked probable cause or that the proceeding was terminated in their favor.
On the prior motion to dismiss, although most of the causes of action were dismissed, the court did not dismiss the cause of action for fraud. In fact, the court noted that the defendants/prior plaintiffs had adequately stated a cause of action sounding in fraud and misrepresentation. Moreover, although the amount of funds which continued to be restrained was lowered, the court still maintained the injunction. As properly set forth by the Yu defendants, "[t]his prior judicial recognition of potential merit of the underlying case creates a presumption that it did not lack probable cause...." Fink v Shawangunk Conservancy, Inc., 15 AD3d 754, 755 (3d Dept 2005).
Moreover, plaintiffs cannot demonstrate that the proceeding was terminated in their favor. To successfully demonstrate a favorable termination, plaintiffs must prove that "the court passed on the merits of the charge or claim against [it] under such circumstances as to show [its] innocence or nonliability, or show that the proceedings were terminated or abandoned at the instance of the defendant under circumstances which fairly imply the plaintiff's innocence [internal quotation marks and citation omitted]." Furgang & Adwar, LLP v Fiber-Shield Industries, Inc., 55 AD3d 665, 666 (2d Dept 2008). As previously mentioned, the court did not dismiss all of the prior plaintiffs' causes of action, and the action is still pending.
Additionally, although some of the prior plaintiffs signed stipulations discontinuing the action, this does not indicate that the Yu defendants abandoned the case or that it was terminated in plaintiffs' favor. See id. ("action of which the plaintiff complains was discontinued by agreement entered into by the parties to this action" does not imply a favorable termination).
The court has determined that plaintiffs cannot satisfy at least two of the elements required out of the four to establish a claim for malicious prosecution. The Appellate Division, First Department has held that "failure to establish any of one of these elements defeats the entire claim [internal quotation marks and citation omitted]." Maskantz v Hayes, 39 AD3d 211, 213 (1st Dept 2007). As such, a discussion of the other elements and special injury is not warranted at this time.
Plaintiffs mention that defendants' conduct constitutes an "abuse of process." Plaintiffs did not set forth a separate cause of action for this in their complaint. In any event, had this been a separate cause of action, it would have been dismissed, since "the mere commencement of the underlying civil action, and the issuance, via proper judicial process, of provisional orders of attachment enjoining claimants from transferring or secreting assets, are insufficient to form the basis for an abuse of process claim." Park v State of New York, 226 AD2d 153, 154 (1st Dept 1996). Regardless, the Yu defendants are not the ones who are objecting to the injunction being vacated.
Accordingly, plaintiffs' first cause of action for malicious prosecution is dismissed.
III. Intentional Infliction of Emotional Distress:
Plaintiffs argue that their good names have been damaged as a result of this lawsuit and that they have suffered mental pain and anguish. Plaintiffs do not provide any examples of their alleged emotional distress.
To successfully plead a cause of action for intentional infliction of emotional distress, the alleged conduct must be "so extreme in degree and outrageous in character as to go beyond all possible bounds of decency, so as to be regarded as atrocious and utterly intolerable in a civilized community [internal quotation marks and citations omitted]." Wolkstein v Morgenstern, 275 AD2d 635, 636-637 (1st Dept 2000). Plaintiffs' unsubstantial allegations do not rise to the level of egregious conduct. As such, they cannot satisfy the pleading requirements to state a cause of action for intentional infliction of emotional distress. Moreover, this cause of action should be dismissed as being duplicative of the one alleging malicious prosecution. See Leonard v Reinhardt, 20 AD3d 510, 510 (2d Dept 2005).
CONCLUSION
Accordingly, it is
ORDERED that the motion to dismiss the complaint brought by defendants Wor Sheng Yu, Wor Ching Yu, Lai Jen Yu, Man Foo Yu and Wor Hong Yu, is granted; and it is further
ORDERED that the complaint is severed and dismissed as to these defendants with costs and disbursements to these defendants as taxed by the Clerk of the Court upon the presentation of an appropriate bill of costs; and it is further
ORDERED that the Clerk is directed to enter judgment accordingly; and it is further
ORDERED that the remainder of the action continues.
ENTER:
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J.S.C.