SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK EVGENY FREIDMAN, Plaintiff, x Index No.: 154619/17 -against- GETZEL SCHIFF & PESCE, LLP, JEFFREY GETZEL, and JOHN DOES 1-10 Defendants. x AFFIDAVIT OF JEFFREY GETZEL Motion Seq.: 001 STATE OF NEW YORK ) )SS. COUNTY OF NASSAU ) Jeffrey Getzel, being duly sworn, states the following under the penalty of perjury: I. I am Managing Partner of Getzel Schiff & Pesce LLP, which is a New York based accounting firm. I make this affidavit on behalf of myself and defendant Getzel Schiff & Pesce LLP (hereinafter collectively referred to as "Getzel Defendants") in support of the Getzel Defendants' Motion to Dismiss pursuant to CPLR 3211(a)(1), (3), and (7). 2. As Managing Partner, I am responsible for overseeing the day-to-day operations of Getzel Schiff & Pesce LLP, including, but not limited to, maintaining client relationships and overseeing my own client files. These overarching responsibilities included my signing up and retaining Evgeny Freidman's company Taxi Club Management, Inc. and its related entities. 3. Evgeny Freidman signed three Engagement Letters on April 15, 2011 on behalf of Taxi Club Management, Inc., 28th Street Management, Inc., Downtown Taxi Management, LLC, 6578996v.1 1 1 of 6
and Woodside Management, Inc. (See Greebel Affirmation Exhibits 2), He did not sign the engagement letters on behalf of himself as an individual, but instead as the sole shareholder of three Subchapter S Corporations. (Taxi Club, Management, Inc., 28th Street Management, Inc. and Woodside Management, Inc.) and as a 33% owner in Downtown Tax Management, LLC. Notwithstanding the fact that this lawsuit lacks merit entirely, Plaintiff, as an individual, is not the proper party to bring this action. 4. At the time the Engagement Letters were executed, Getzel Schiff & Pesce LLP formerly was known as Getzel Schiff & Ross LLP. That company and the current company are exactly the same for tax purposes, legal purposes, and the division of corporation registry purposes. The only thing that has changed is the name and certain named partners. 5. The three Engagement Letters are true and correct copies of the originals executed between the parties. 6. As the Engagement Partner for the engagement with plaintiff's companies, I prepared the engagement letters and oversaw the work performed. Furthermore, I set the billing rates for the work on the engagements and chose the individuals from my firm who would be assisting. 7. According to the terms of the Engagement Letters, the Getzel Defendants also were responsible for preparing federal, state, and where applicable city income tax returns for a variety of entities including Taxi Club Management, Inc., related real estate entities, related trusts, Medallion Cab Companies, etc. The Getzel Defendants also were responsible for compiling quarterly and annual financial statements for Evgeny Freidman's companies: 28th Street Management, Inc., Downtown Tax Management LLC, and Woodside Management, Inc. 2 6578996v. I 2 of 6
upon which accountants reports would be prepared.' The Getzel Defendants were not responsible for identifying for these companies internal errors, fraud or illegal acts, or making management decisions/functions. 8. According to the terms of the Engagement Letters, the companies were responsible for preparing a fair presentation of their financial statements in accordance with Generally Accepted Accounting Principles, designing/implementing internal controls, preventing and detecting fraud, and insuring compliance with United States laws. The companies failed to do these tasks on multiple occasions. 9. The engagement letters also make clear that invoices for services rendered must be paid immediately and that any invoices that were more than 30 days overdue were subject to interest on top of the principal. 10. Throughout the course of the engagement, the Getzel defendants performed their obligations fully and did not deviate from generally accepted professional standards. Moreover, I did not provide any financial and/or investment advice to plaintiff or his companies, and never held myself out to be an expert in the field of investments. In fact, plaintiff told me that he did not pay me to give him advice (See Greebel Affirmation Exhibit 3). 11. Upon information and belief, the Getzel defendants never tortiously interfered with plaintiff's business relations and/or acted with malice to harm plaintiff. Quite frankly, the Getzel defendants believe this claim to be outlandish. ' By verbal agreement the compilation of quarterly financial statements for Plaintiff Freidman's three (3) taxi cab fleet operating companies were reduced to annual financial statements due to the failure of his bookkeeping department to adequately and timely maintain the books and records of said companies. 3 6578996v.1 3 of 6
12. Upon information and belief, the Getzel defendants, throughout the engagement, never committed fraud or conspired to commit fraud at the expense of plaintiff Freidman. Plaintiff's complaint, including, but not limited to, the fraud and conspiracy allegations, lack foundation and lack merit, are baseless, and do not meet the standards required under New York law. The Getzel defendants are quite stunned by the frivolity of these claims. 13. The Getzel defendants respectfully request that the Court not allow the plaintiff to amend his pleadings in any respect and dismisses the causes of action with prejudice. Furthermore, the Getzel defendants request that the Court sanction plaintiff and compel plaintiff to reimburse the Getzel defendants for having to make this motion to dismiss. 14. Furthermore, the Getzel defendants ended their engagement with plaintiff's business entities on January 16, 2017 (See Greebel Affirmation Exhibit 4). The Getzel defendants ended this relationship because plaintiff and his business entities owe approximately $945,948.06 in accounting fees for Getzel defendants' services rendered. In addition to the indebtedness, Plaintiff and his entities repeatedly refused to follow tax guidance provided by the Getzel defendants, which put the Getzel defendants in potentially compromising positions. 15. The Court should be advised that the Getzel Defendants have attempted to return plaintiff's and plaintiffs entities tax files. The Getzel Defendants gave their attorneys these files in order for the attorneys to personally deliver them to plaintiff. However, even after counsel reached out to plaintiff to discuss the delivery of these files, plaintiff has refused to accept delivery of the boxes and has refused to meet with counsel to review the contents of the boxes. Plaintiff's conduct in this situation is representative of his conduct throughout the engagement 6578996v.1 4 4 of 6
and demonstrates why the Getzel Defendants disengaged in the first place and cannot be compelled to do anymore work for plaintiff or his business entities. 16. Plaintiff Freidman also has pled a cause of action to compel the Getzel defendants to perform under the terms of the terminated engagements. Again, the Getzel defendants find this claim to be preposterous and entirely against their rights to freely associate with whomever they choose. The Getzel defendants should not be compelled to do work for someone who owes nearly one million dollars to this firm and has put me and this firm in ethically compromising positions. Being forced to do work for plaintiff is untenable and improper under New York public policy. 17. Finally, we believe that plaintiff has brought this frivolous action in order to financially assist himself as it relates to his currently pending civil and criminal legal battles.2 In our estimation, the case is borderline extortion. Plaintiff should not be allowed to get away with this conduct. 18. Based on the above, the documents annexed to the affirmation of Rory G. Greebel, and the legal arguments made in the accompanying memorandum of law, the Getzel defendants' motion to dismiss the plaintiff's complaint with prejudice should be granted in its entirety. 2 Currently the plaintiff is defending himself in a criminal proceeding which he is alleged to owe New York State $5 million in back taxes, a criminal case involving death threats to a former business partner, a sexual harassment proceeding brought by a former employee, and civil lawsuits brought by former business partners. 5 6578996v,1 5 of 6
19. WHEREFORE, Defendants, Getzel Schiff & Pesce LLP and Jeffrey Getzel respectfully request that the Court (1) enter an Order pursuant to CPLR 3211(a)(1), (3), and (7) granting their motion to dismiss the plaintiffs complaint with prejudice; (2) awarding the Defendants Getzel Schiff & Pesce LLP and Jeffrey Getzel costs for making said motion; and (3) such other and further relief as the Court deems just and proper. Sworn to before me this 10th day of July 2017 Notary Public PAULA C. FR.E.SSLE Nolorylk6k Sato of New York No, 01FR6312162 Quaffed in Nassau County Commission &Om-Sept. 22, 20 /7 6578996v,1 6 6 of 6