GRAUBARD MOLLEN DANNETT & HOROWITZ, & C. RESPONDENT, v. IRVING MOSKOVITZ,
APPELLANT, ET AL., DEFENDANTS.
86 N.Y.2d 112, 653 N.E.2d 1179, 629 N.Y.S.2d 1009
July 6, 1995
1 No. 179 (1995 NY Int. 184)
Decided July 6, 1995
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This opinion is uncorrected and subject to revision before publication
in the New York Reports.
Christopher J. Sullivan, for Appellant.
Scott E. Mollen, for Respondent.
KAYE, CHIEF JUDGE:
This appeal focuses on a modern-day law firm fixture, the revolving
door. With charges of faithless deserting partners and countercharges
of a vindictive abandoned firm, the key question becomes whether
departing partners can "solicit" clients of the firm. Here we decide
only that plaintiff law firm's allegations of breach of fiduciary
duty, breach of contract and fraud are sufficient to withstand summary
dismissal, which was the conclusion also reached by the tr ial court
and Appellate Division.
The following factual account is drawn largely from the assertions of
plaintiff law firm, the nonmovant, and denied in material part by
defendants. As alleged in the Amended Complaint, defendant-appellant
Irving Moskovitz, along with Seymour Graubard, in 1949 founded
plaintiff law firm. Over the next 40 years, the firm grew to 35
lawyers, with four senior partners--Graubard, Moskovitz, Raymond
Horowitz and Emmanuel Dannett. Defendant Peter Schiller joined the
firm in 1949 and became a partner in 1956; defendant John Young
arrived in 1964 and became a partner in 1971. Control of the firm,
however, was centered in the four seniors (who initiated most of the
business), especially Moskovitz, the firm's managing partner for 33
years, until 1982.
In 1959, Moskovitz brought into the firm as a client F. Hoffman
LaRoche & Co., Ltd. and affiliates ("Roche"), a worldwide
pharmaceutical group headquartered in Switzerland. Legal services for
Roche were mainly in the area of international taxation, Moskovitz's
specialty, although the firm also handled corporate and litigation
matters for the client. In the late 1980s, billings to Roche exceeded
SNIPPETS:
With charges of faithless deserting partners and countercharges of a vindictive abandoned
Here we decide only that plaintiff law firm's allegations of breach of fiduciary duty, breach
The following factual account is drawn largely from the assertions of plaintiff law firm, the
As alleged in the Amended Complaint, defendant-appellant Irving Moskovitz, along with Seymour
Over the next 40 years, the firm grew to 35 lawyers, with four senior partners--Graubard,
Control of the firm, however, was centered in the four seniors (who initiated most of the
Legal services for Roche were mainly in the area of international taxation, Moskovitz's
Concerned with developing a plan both for transition of management to the junior partners and
The agreement provided for a three-year "phase-down" during which the four senior partners
At the end of the three-year phase-down, having received back his capital as well as
1987 Roberts put Moskovitz in touch with LeBoeuf Lamb Leiby & MacCrae, a New York based firm,
In March 1988 Moskovitz asked Roche's tax director whether the company had any objection to
plaintiff firm was engaged in settlement negotiations of a tax audit matter for Roche from
defendants moved for summary judgment and plaintiff cross-moved for summary judgment on its
On renewal in 1992 the trial court denied summary judgment finding that there were material
Both sides acknowledge as well the principle that an attorney stands in a fiduciary relation
One respected commentator opines that, while a departing partner's preresignation
We agree with the trial court and Appellate Division, however, that as a matter of principle,
Such conduct exceeds what is necessary to protect the important value of client freedom of
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