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Conclusory Allegations of Bad Faith in Negotiations Pursuant to a Settlement Agreement Did Not State a Cause of Action

The Court of Appeals, in a full-fledged opinion by Judge Read, over a dissent, determined the parties failure to come to an agreement did not give rise to a cause of action.  The negotiations, pursuant to a prior settlement agreement, had come to an impasse which, the Court of Appeals concluded, was not actionable:

It is true, as the concurring Justices in the Appellate Division pointed out, that courts normally give a generous reading to pleadings that are attacked as insufficient on their face. But it is not too much to ask that a pleading filed after more than a decade of back and forth between the parties contain some specific facts supporting the claim of bad faith — not just the bald conclusions, contradicted by the only relevant document referred to, that [defendant] insisted “on terms that conflicted with the Settlement Agreement” and “made a definite and final communication” of its intent to violate its obligations. IDT Corp v Tyco Group SARI, 2014 NY Slip Op 04044, CtApp 6-5-14

 

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