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PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED.

The Second Department, reversing Supreme Court, determined the motion to dismiss the fraud-based complaint for lack of personal jurisdiction over defendant, whose domicile was Florida, should not have been granted. Relevant funds were deposited in the escrow account for defendant’s New York law firm and those funds were alleged to have been converted in New York:

… [T]he plaintiffs made a prima facie showing that the defendant, a Florida domiciliary, transacted business in New York and that the plaintiffs’ claims arose from those transactions so as to establish that jurisdiction was proper under CPLR 302(a)(1)… . Accepting the plaintiffs’ allegations as true and construing the allegations in the light most favorable to the plaintiffs, they demonstrated prima facie that the defendant purposefully availed himself “of the privilege of conducting activities” in New York, “thus invoking the benefits and protections of its laws” … . Contrary to the defendant’s contention, his alleged contacts with New York amounted to more than mere communications … . The defendant allegedly utilized Sommer & Schneider’s New York escrow account to further the alleged fraudulent investment scheme by directing the plaintiffs to deposit the funds for investment deals into the escrow account, by acting as the agent for the purported investment deals, and by using and allowing Joel to use the investment money deposited in the escrow account for personal expenses … . As to the second prong of the CPLR 302(a)(1) analysis, the plaintiffs’ allegations demonstrated prima facie that the defendant’s activities in New York had an articulable nexus or substantial relationship to the plaintiffs’ claims … . The plaintiffs’ claims against the defendant of fraud, conversion, breach of fiduciary duty, and unjust enrichment turned entirely on the defendant’s use of the New York escrow account to facilitate his fraudulent investment scheme … .

The plaintiffs also made a prima facie showing that the defendant committed tortious acts within New York, as the defendant is alleged to have converted funds held in New York … . Nick v Schneider, 2017 NY Slip Op 04285, 2nd Dept 5-30-17

 

CIVIL PROCEDURE (LONG ARM JURISDICTION, PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)/JURISDICTION (CIVIL PROCEDURE, LONG ARM JURISDICTION, PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)/LONG ARM JURISDICTION (FRAUD,  PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)/FRAUD (CIVIL PROCEDURE, LONG ARM JURISDICTION,  PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)/CONVERSION (CIVIL PROCEDURE, LONG ARM JURISDICTION, PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)/INTENTIONAL TORTS (CONVERSION, CIVIL PROCEDURE, LONG ARM JURISDICTION, PLAINTIFF, INTER ALIA, ALLEGED THE FLORIDA DEFENDANT IN THIS FRAUD-BASED ACTION DEPOSITED RELEVANT FUNDS IN A NEW YORK LAW FIRM ESCROW ACCOUNT AND CONVERTED THOSE FUNDS, DEFENDANT’S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION SHOULD NOT HAVE BEEN GRANTED)

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