SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ----------------------------------------------------------------------------------X KAMCO SUPPLY CORP., On behalf of tself and ndex No. 651725-15 all other persons smlarly stuated as trust fund benefcares of Len Law trusts of whch Nastas & Assocates, nc., s a trustee, ORDER WTH NOTCE OF ENTRY Plantff, -aganst- NASTAS & ASSOCATES, NC., J.T. MAGEN & COMPANY NC., LBERTY MUTUAL NSURANCE COMPANY, ANTHONY J. NASTAS AND "JOHN DOE ONE" THROUGH "JOHN DOE TEN", Defendants. ----------------------------------------------------------------------------------X - â PLEASE TAKE NOTCE, that the wthn s a true copy of an Order dated June 8, 2018 and entered wth the Clerk of the wthn Court on June 12, 2018. DATED: Huntngton Staton, New York June 12, 2018 MARSHAL. M.'STERN, P.C. By: Marshall M. Stern, Esq. Attorneys for Plantff 17 Cardff Court Huntngton Staton, New York 11746 (631) 427-0101 TO: THOMAS V. PLLAR, ESQ. Attorneys for Defendant Nastas & Assocates, nc. and Anthony J. Nastas 114 Old Country Road, Sute 680 Mneola, NY 11501 (516) 873-8787 MELTZER, LPPE, GOLDSTEN & BRETSTONE, LLP Attorneys for Defendants J.T. Magen 8 Company nc. and Lberty Mutual nsurance Company Attn: Manny Frade, Esq. 190 Wlls Avenue Mneola, NY 11501 (516) 747-0300 1 of 10
MCHAEL A. KOFSKY, ESQ. Attorneys for Defendant Nastas 8 Assocates, nc. and Anthony J. Nastas The Law Offce of Mchael A. Kofsky, PLLC 41 North Street West slp, NY 11795 2 of 10
NDFX NO. 651725/2015 NYSCEF DSUPEEMETOURT OF THE STASEUFENEW5YORKO6/12/2018 NEW YORK COUNTY PRESENT: HON. ANDREA MASLEY Just/ce PART l. ndex Number : 65U725/2Ò 5 KAMCO SUPPLY CORP., ON NDEX NO. vs. MOUON DATE NASTAS) 8 ASSOCATES, NC. SEQ UENCE NUMBER : 002 MOTON SEQ. NO. MOTON TO COMPEL DSCLOSURE - -..... 2.....- ' The followng papers, numbered 1 to _, were read on ths moton to/for Notce of Moton/Order to Show Cause - Affdavts - Exhbts No(s).. Answerng Affdavts - Exhbts No(s). Replyng Affdavts No(s). Upon the foregong papers, t s ordered that ths moton s Lu. dednaccordance O hotoft s decded n memorand wth ac om nyng egggaqyllg ~ g decsonnm91191l D0 rn -Og tots m Z r~m 0 0 O4 z 0 - O 0 E u. Dated HON.AND 1. CHECK ONE:... O CASE DSPOSED Q NON-FNAL DSPOSTON 2. CHECK AS APPROPRATE:...MOTON S: O GRANTED DENED ÓANTED N PART OTHER 3. CHECK F APPROPRATE:... O SETTLE ORDER D SUBMT ORDER EA 1.-EY. J.S.C. DO NOT POST OFDUCARY APPONTMENT O REFERENCE 1 of 8 3 of 10
NDEX NO. 651725/2015 NYSCEF DOC...NO. NO. 115 RECEVED NYSCEF: 06/12/2018 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: COMMERCAL PART 48 KAMCO SUPPLY CORP. on behalf of tself ard all other persons smlarly stuated. as trust fund of Len Law trusts of whch NASTAS 8 ASSOCATES, NC., s a trustee,. ndex No. 6517252015. Plantff, Mot. Seq. No. 002 -aganst- Decson and Order NASTAS 8 ASSOCATES, NC., J.T. MAGEN 8 COMPANY NC., LBERTY MUTUAL NSURANCE COMPANY ANTHONY J. NASTAS, and "JOHN DOE ONE"through "JOHN DOE TEN," Defendants. Plantff, Kamco Supply Corp. (Kamco), ndvdually and on behalf of all other persons smlarly stuated as trust fund benefcares of Len Law trusts pursuant to the court's October 6; 2015 order, moves, pursuant to CPLR 3124 and 3126, for an order compellng defendants Nastas 8 Assocates, nc. (N&A) and Anthony J. Nastas (Nastas) to: (1) comply wth ths court's order, dated October 6, 2015 (see NYSCEF Doc. No. 37 [Ong, J.]), by provdng a lst of all subcontractors, supplers, and other potental benefcares pursuant to the Len Law n connecton wth 20 projects wth whch N&A was engaged; and (2) fully respond tokamco's dscovery demands, and provde access to books or records as requred under Len Law 75. Kamco also seeks, pursuant to CPLR 3124, an order compellng defendants J.T. Magen 8 Company nc. (JTM) and N&A to provde all documents related to those partes' transactons, agreements, and ) 1 2 of 8 4 of 10
. NDEX NO. 651725/2015 NY SCE F DOC. NO. 115 RE'CE VE D NY S CE F: 06/12/2018 communcatons pertanng to the 20 projects dentfed n the amended complant. Defendants JTM and Lberty Mutual nsurance Company (Lberty) cross move, pursuant to CPLR 3212 (b), for an order summarly dsmssng the complant as aganst them. Background The followng factual allegatons are taken from the amended complant ( unless otherwse noted... Kamco asserts that t provded acoustcal tles to N&A, a subcontractor to a project at 150 East 42nd street (150 East Project) for whch JTM was the general contractor; N&A allegedly faled to pay Kamco $939,301.88 for those materals, and Kamco fled a mechanc's len for that non-payment. Under that prong of the amended complant,.kamco seeks to recover the $939,301.88 ) unpad balance, plus nterest, from N&A and ts prncpal, Nastas (together, Nastas Def ndants); Kamco also seeks to foreclose on the len, whch has been substtuted by a len dscharge bond purchased by JTM from Lberty. Kamco also asserts that t provded materals to N&A for 20 buldng constructon projects wth whch N&A was nvolved snce November 1, 2015, and. asserts Len Law trust-dverson class acton clams aganst the Nastas Defendants. Kamco requests an accountng of all Len Law trust funds for each of the 20 projects, ncludng one or more projects for whch JTM was the general contractor, to dentfy the benefcares of the Len Law funds and ascertan the amounts pad and owed to N&A for each project. Kamco seeks to recover, on ' 2 3 of 8 5 of 10
NDEX NO. 651725/2015, NYSCEF DOC. NO. 115 RECEVED NYSCEF: 06/12/2018 behalf of tself and the class, damages sustaned due to the Nastas Defendants' alleged msappropraton or dverson of such funds. By order, dated October 6, 2015, the court granted on default Kamco's moton (mot. seq. no. 001), pursuant to Len Law. 77 and CPLR 902, 903, and 904, to mantan ths sut as a Len Law trust-dverson class acton under Artcle 9 of the Cl5LR, and drected the Nastas Defendants to furnsh a lst of all subcontractors, supplers, and other potental benefcares under Len Law Artcle 3-A for each of the projects lsted n l the amended complant. The Nastas Defendants have faled to comply. Dscusson. 1. Kamco's Moton as to the Nastas Defendants Kamco now moves, pursuant to CPLR 3124, for an order: (1) compellng the Nastas Defendants to provde the lst of all subcontractors, supplers, and 1 other potental benefcares, as drected by the court's October 6, 2015 order; (2) compellng the Nastas Defendants to formally and adequately respond to Kamco's dscovery demands, and provde Kamco.access to records requred to be mantaned under Len Law 75; or, alternatvely, (3) strkng the Nastas Defendants' answer pursuant to CPLR 3126 (see Stern aff 1, 5-17). n opposton to Kamco's moton, Nastas states, n hs August 15, 2017 affrmaton, that nether he nor N&A has access to any books or records of N&A. Nastas further states that N&A's offces were rented from the Frahkln D. Nastas Trust (Famly Trust), and that N&A owed the Famly Trust $3.2 mllon as of. January 2014. As a result of that debt, Nastas was removed as a benefcary of the Famly Trust, though he remaned a co-trustee wth hs sblngs. n December 1.33 4 of 8 6 of 10
NDEX NO. 651725/2015 NYSCEF DOC. NO. 115 RECEVED NYSCEF: 06/12/2018 2015, the debt remaned at or over $3.2 mllon, and the Famly Trust decded to sell the buldng n whch N&A mantaned ts offces. Nastas nformed the Famly Trust that N&A "had no funds wth whch to remove and/or store any of ts offce equpment, records, [or] fles," and N&A 'faled to properly vacate" buldng; the Famly Trust then."dsposed of, or destroyed," all of N&A's equpment, records, and fles (Nastas aff pe 5-13). Thus, nether Nastas nor N&A has the books, â â records, or nformaton-requred to be mantaned under the Len Law-sought by Kamco. j Kamco's moton s dened as to the document producton demanded of the Nastas Defendants n connecton wth the 150 East Project. Kamco requests / that t be furnshed wth the Nastas Defendants' and the Famly Trust's complete bank records f the documents demanded from the Nastas Defendants have been destroyed or lost. The court has receved copes of those complete bank records from Frst Republc Bank, at whch the Nastas Defendants and the Famly Trust mantaned ther bank accounts, by letter and enclosures, dated May 4, 2018 n response to Kamco's amended subpoena duces tecum served upon the bank. Nastas asserts all records were destroyed, and Kamco now has the alternate relef t has requested; accordngly, that prong of Kamco's moton s ' moo However, the Nastas Defendants'.have completely faled to comply wth the court's C)ctober 6, 2015 order grantng Kamco's moton to mantan ths case as a Len Law trust-dversor class acton, and Nastas Defendants" affdavts, and the record, demonstrate that the.nastas Defendants were on notce of ths f 5 of 8 4 7 of 10
NDEX.NO. 651725/2015 NYSCEF DOC. NO. 115 RECEVED NYSCE': 06/12/2018 ltgaton, served wth the court's order grantng moton sequence number 001 wth notce of entry, and receved document dscovery demands pertanng to the. class acton prong of ths matter from Kamco n the months before N&A's offce buldng was sold by the Famly Trust, of whch Nastas was a co-trustee. The Nastas Defendants were, therefore, on notce of ther oblgatons to preserve evdence n ths matter, but nonetheless permtted the destructon of all N&A records (see Adran v Good Neghbor Apt. Assocs., 277 AD2d 146 [1st Dept 2000] [a party has a duty to preserve evdence when t has notce of pendng ltgaton]). A party seekng spolaton sanctons must show that: (1) "the party havng control over the evdence possess an oblgaton to preserve t at the tme of ts! destructon" destructon"; 1.(2) "the evdence was destroyed wth a culpable state of mnd"; and (3) "the destroyed evdence was relevant to the party's clam or defense such that the trer of fact could fnd that the evdence would support that clam or defense" (Pegasus Avaton 1, nc. v Varg Logstca S.A., 26 NY3d 543, 547 [2015]). Here, the Nastas Defendants had control over the evdence, and the culpable.state of mnd of the Nastas Defendants can be nferred by the fact that they never responded or attempted to comply wth ths court's October 6, 2015 order pror to the destructon of N&A books and records n December 2015, ' despte havng receved the order wth notce of entry and Kamco's related dscovery demands n October and early-november 2015; ndeed, Nastas was a co-trustee of the Famly Trust that rented offce space to, and evcted, N&A, 5 6 of 8 8 of 10
ÏNDEX NO. 651725/2015. NYSCEF DOC. NO. 115 RECEVED NYSCEF: 06/12/2018 purportedly leadng to the destructon of all busness records of the Nastas Defendants, whch the Nastas Defendants totally faled to preserve. Addtonally, the destroyed evdence s planly relevant n that t would establsh the.putatve class and the extent of damages f any Kamco and other smlarly stuated benefcares sustaned. Accordnglý,.the answer of the Nastas Defendants s strcken. 2. Karnco's Moton as to JTM and JTM's and Lberty's Cross Moton JTM and Lberty's cross moton for summary dsmssal of the amended complant as aganst them s dened. Even f JTM and Lberty had establshed that there s no trust fund because JTM pad all amounts due to N&A pror to the flng of the rnechanc's len, Kamco has rased a trable ssue of fact as to the proprety and completeness of JTM's nformal dscovery responses, JTM's clamed accountngs, and JTM's falure to adequately explan nconsstences between amounts charged by, and pad to, N&A. Moreover, Kamco's moton s granted as to JTM. To the extent that JTM has not formply.or adequately responded to Kanco's dscovery pror dscovery demands, t must do so. Addtonally, to the extent that JTM's lmted responses have rased addtonal ssues to be explored by Kamco n dscovery, Kamco may serve a supplemental dscovery demand wthn 20 days of ths order. Accordngly,.. Plantff Kamco havng establshed that defendants Nastas 5 Assocates, nc. and Anthony J. Nastas have wllfully faled to provde dscovery as drected n the.october 6, 2015 order of ths court n that they faled to preserve records, 6 7 of 8 9 of 10
-.... - -NDEX NO. 651/ T572U15 NYSCEF DOC. NO'.. 115 RECEVED NYSCEF: 06/12/2018.. books, and other nformaton whle on notce of ths ltgaton, the October 6, 2015 - order, and the plantff's related dscovery demands, t s hereby 1 ORDERED that Kamco's moton s granted and the answer of defendants. Nastas & Assocates, nc. ard Anthony J. Nastas s strcken; and t s further ORDERED that Kamco's moton to compel dscovery from defendant J.T. Magen & Company, nc. s granted, and t s further ORDERED that Kamco shall fle a supplemental dscovery demand upon f J.T. Magen & Company, nc. wthn 20 days of ths order, and J.T. Magen & Company, nc. shall respond to that supplemental demand and any prevouslyserved dscovery demands of Kamco and produce, to the extent t has not already done so, all responsve, non-prvleged documents, and a prvlege log complant wth Commercal Dvson Rule 11 (b), n accordance wth the.cvl Practce Law and Rules; and t s further ORDÈRED that the cross moton for summary judgment of defendants J.T. Magen & Company, nc. and Lberty Mutual nsurance.company s dened and t s further ORDeRED that counsel shall appear for a status conference n Room 242, 60 Centre Street, on August 14, 2018 at 10:30 A.M. DATÉ: Sflf NT R: e Mas y, C -'HON. ANDREA MASLEY 8 gf 8 10 of 10