Matter of People v Northern Leasing Sys., Inc. (2019 NY Slip Op 01179) Matter of People v Northern Leasing Sys., Inc. 2019 NY Slip Op 01179 Decided on February 19, 2019 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports. Decided on February 19, 2019 Manzanet-Daniels, J.P., Kapnick, Gesmer, Oing, JJ. 450460/16 8433 8432 [*1]In re People of the State of New York, etc., et al., Petitioners-Respondents-Appellants, vNorthern Leasing Systems, Inc., et al., Respondents-Appellants-Respondents, Joseph I. Sussman, P.C., et al, Respondents-Respondents. Cahill Gordon & Reindell LLP, New York (Thomas J. Kavaler of counsel), for appellants-respondents. Barbara D. Underwood, Attorney General, New York (Ester Murdukhayeva of counsel), for respondents-appellants. Rottenberg Lipman Rich, P.C., New York (Mark M. Rottenberg of counsel), for respondents. Orders, Supreme Court, New York County (Lucy Billings, J.), entered November 29, 2017, which granted respondents Northern Leasing Systems, Inc., Lease Finance Group LLC, MBF Leasing LLC, Lease Source-LSI, LLC, Golden Eagle Leasing LLC, Pushpin Holdings LLC, Jay Cohen, and Neil Hertzman's (collectively, Northern Respondents) motion to dismiss the Executive Law § 63(12) and CPLR 5015(c) claims as against them to the extent the claims are based on illegal conduct in violation of General Business Law § 349, and denied the motion as to the remainder of the Executive Law § 63(12) and CPLR 5015(c) claims and the Business Corporation Law § 1101 claim, and granted respondents Joseph I. Sussman, P.C., Joseph I. Sussman, and Eliyahu R. Babad's (together, Attorney Respondents) motion to dismiss the petition as against them, unanimously modified, on the law, to deny the Attorney Respondents' motion except as to the General Business Law 349 claim, and otherwise affirmed, without costs. The petition fails to state a cause of action based on violations of General Business Law 349, because the lessees and guarantors who were affected by the deceptive conduct are not alleged to be "consumers" within the meaning of the statute. There are no factual allegations that would show that the underlying transactions involve goods or services for "personal, family or household purposes" (Cruz v NYNEX Info. Resources, 263 AD2d 285, 289 [1st Dept 2000] [internal quotation marks omitted], citing, inter alia, General Business Law § 399-c). The Executive Law § 63(12) claim is based on a type of fraud recognized in the common law, and therefore is governed by the six-year statute of limitations (CPLR 213[1]; People v Credit Suisse Sec. [USA] LLC, 31 NY3d 622, 634 [2018]). The petition alleges that the Northern Respondents, via "Independent Sales Organizations" (ISO) sales representatives, knowingly made misrepresentations and omissions of fact to merchants for the purpose of inducing them to enter into the predatory leasing agreements and that the merchants justifiably relied on those misrepresentations or omissions in entering into the agreements to their detriment (see Ambac Assur. Corp. v Countrywide Home Loans, Inc., 31 NY3d 569, 578-579 [2018]; see also Pludeman v ...
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