CUPERSMITH et al v. PIAKER & LYONS, P.C. et al
DECISION AND ORDER granting Pltfs' 163 & 165 Motions. The Clerk is directed to enter final judgment as to the claims and Pltfs dismissed by Court's 9/27/16 Order. The remaining active claim of Pltf Ilene Nemeth is stayed pending the resolution of the appeal of the 9/27/16 Order. Signed by Senior Judge Thomas J. McAvoy on 10/10/17. (sfp, )
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
NEAL A. CUPERSMITH, et al.
PIAKER & LYONS P.C., et al.
THOMAS J. McAVOY,
Senior United States District Judge
DECISION & ORDER
Plaintiffs move for entry of a final judgment pursuant to Fed. R. Civ. P. 54(b) of the
claims dismissed by this Court’s September 27, 2016 Decision and Order. (Doc. No. 163
and Doc. No. 165). Defendants submit no opposition to the motion. For the reasons that
follow, the motion is granted.
This action was commenced by sixty-six individuals and two estates alleging that the
Defendants, the Piaker & Lyons accounting firm and two partners in the firm, Ronald L.
Simons and Timothy N. Paventi, participated in and helped conceal a Ponzi scheme in
which Plaintiffs unwittingly invested. Plaintiffs asserted claims against Defendants under
several theories, but only the claims asserting that Defendants aided and abetted the
perpetration of the Ponzi scheme remained pending when the Court issued its September
27, 2016 Decision and Order (Doc. No. 147) (“the Order”).
In the Order, the Court dismissed the claims of all but three Plaintiffs (Peter Zakroff,
Teresa Zakroff, and Ilene Nemeth) based on statute of limitation grounds, and dismissed all
claims for investments made before September 11, 2008. 1 The Court also found that,
notwithstanding the untimeliness of many of the claims, Plaintiffs presented sufficient facts
to withstand summary judgment on their aiding and abetting fraud claims such that the case
could proceed for those claims not dismissed on statute of limitations grounds.
Thereafter, Plaintiffs filed a motion for entry of final judgment pursuant to Rule 54(b),
or, in the alternative, to certify the Order for interlocutory appeal pursuant to 28 U.S.C. §
1292(b) (Doc. No. 151). Defendants filed an affidavit indicating that “[e]ven though the
Defendants adamantly contend that the Decision and Order of this Court dated September
27, 2016 . . . was properly decided and will be affirmed by the Court of Appeals of the
Second Circuit, the Defendants do not oppose the relief requested herein by Plaintiffs.”
(Doc. No. 152, ¶ 2). Defendants also indicated that a “decision of the Second Circuit
determining the extent of the remaining claims in this action would significantly enhance the
prospect of discussions between the parties that could potentially lead to a resolution that
would obviate the necessity of a trial of the remaining Plaintiffs in this action.” Id. ¶ 4. The
Court entered an order (Doc. No. 155) certifying the Order for interlocutory appeal but the
Second Circuit denied Plaintiffs’ petition for leave to appeal under § 1292(b). Plaintiffs now
renew their motion to enter final judgment on the dismissed claims pursuant to Rule 54(b).
Between the filing of Plaintiffs’ first motion (Doc. No. 151) and the filing of the instant
motion, several Plaintiffs voluntarily dismissed their claims, including Peter and Theresa
Thus, even for the three remaining Plaintiffs, all of their claims except those based on investments
made after September 11, 2008 were dismissed.
Zakroff (Doc. No. 162). As a result, the only active claim remaining is for a single
investment by Plaintiff Ilene Nemeth in the amount of $10,000. Plaintiffs note that, by
contrast, the claims dismissed by the Order total more than $7,100,000.00.
a. Rule 54(b)
In general, there is a “‘historic federal policy against piecemeal appeals.’”
Curtiss-Wright Corp. v. General Electric Co., 446 U.S. 1, 8, 100 S. Ct. 1460, 64 L. Ed.2d 1
(1980)(quoting Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 438, 76 S.Ct. 895, 100
L.Ed. 1297 (1956)). “Thus, in the federal district courts, the entry of a final judgment is
generally appropriate ‘only after all claims have been adjudicated.’” Novick v. AXA Network,
LLC, 642 F.3d 304, 310 (2d Cir. 2011)(quoting Harriscom Svenska AB v. Harris Corp., 947
F.2d 627, 629 (2d Cir.1991)).
An exception to this general principle is found in Rule 54(b), which provides that
[w]hen an action presents more than one claim for relief—whether as a claim,
counterclaim, crossclaim, or third-party claim—or when multiple parties are
involved, the court may direct entry of a final judgment as to one or more, but
fewer than all, claims or parties only if the court expressly determines that
there is no just reason for delay.
Fed. R. Civ. P. 54(b).
Rule 54(b) should be “exercised sparingly” and only if the “interests of sound judicial
administration and efficiency” will be served. Harriscom, 947 F.2d at 629. “To be
appropriate, a Rule 54(b) certification must take account of both the policy against
piecemeal appeals and the equities between or among the parties.” Novick, 642 F.3d at
310. “[I]n deciding whether there are no just reasons to delay the appeal of individual final
judgments” a district court should “consider such factors as whether the claims under review
[a]re separable from the others remaining to be adjudicated and whether the nature of the
claims already determined [i]s such that no appellate court would have to decide the same
issues more than once even if there were subsequent appeals.” Curtiss-Wright, 446 U.S. at
8 (quoting Sears Roebuck, 351 U.S. at 435, 437, 438, 76 S. Ct. 895); see Novick, 642 F.3d
at 311 (A court “generally should not grant a Rule 54(b) certification if the same or closely
related issues remain to be litigated.”)(internal quotation marks and citation omitted). It is
“left to the sound judicial discretion of the district court to determine the ‘appropriate time’
when each final decision in a multiple claims action is ready for appeal.” Curtiss-Wright, 446
U.S. at 8 (citations omitted).
The Order is a clear final adjudication of all claims dismissed thereby, and there is no
just reason for delay in appealing this decision. Although the dismissed claims are similar
to the remaining claim of Ilene Nemeth (in that they all allege aiding and abetting fraud
against the Defendants), the issue on appeal will apparently be limited to whether the Court
properly applied the applicable statutes of limitation to Plaintiffs’ claims. The issue
underlying the statutes of limitation determinations (i.e. whether Plaintiffs were on inquiry
notice of their claims against Defendants as of 2010) applies to all Plaintiffs. Thus, the
appellate court would not be required to decide this issue more than once.
Further, the issue to be presented for appeal is the discrete issue of the application
of the statute of limitations, and not the substance of the aiding and abetting claims
themselves. Where the issue for appeal is easily separable, a certification under Rule 54(b)
is appropriate. See, e.g., Roebuck v. Guttman, 678 F. Supp. 68, 70 (S.D.N.Y. 1988) (finding
certification under Rule 54(b) appropriate where the issue for appeal was “unrelated to the
question of whether the legally sufficient claims … will be proved at trial, and involved “a
discrete and straightforward legal issue which the Court of Appeals can resolve quickly and
which will serve the goal of judicial economy.”)
Still further, immediate appellate review serves the interests of judicial administration
and judicial economy. Plaintiffs indicate that they intend to seek review of the Order
regardless of the outcome of the disposition of Mrs. Nemeth’s remaining claim. As Plaintiffs
ague, entering a Rule 54(b) final judgment and allowing Plaintiffs to appeal the Order
immediately would hasten the resolution of the entire case. 2
Finally, the equities of the parties favor entry of a Rule 54(b) final judgment allowing
Plaintiffs to appeal the Order immediately. As indicated by Defendants in response to the
first motion, they did not oppose the relief sought by Plaintiffs and recognize that the
prospect of resolution of the matter without a trial will be significantly enhanced by a
decision of the Second Circuit.
For the reasons discussed above, Plaintiffs’ motion (Doc. No. 163 and Doc. No. 165)
for entry of a Rule 54(b) final judgment on the claims and Plaintiffs dismissed by this Court’s
September 27, 2016 Decision and Order is GRANTED. The Clerk is directed to enter final
judgment as to the claims and Plaintiffs dismissed by the Court's September 27, 2016
Plaintiffs argue that whether they are successful on appeal or not, such review would facilitate the
resolution of the claims of all Plaintiffs either by a single trial or settlement.
Decision and Order.
The remaining active claim of Plaintiff Ilene Nemeth is stayed pending resolution of
the appeal of the Court's September 27, 2016 Decision and Order.
IT IS SO ORDERED.
Dated:October 10, 2017
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