Halperin v. Salvan

Kupferman, J. P.,

dissents in a memorandum as follows: I would grant the cross motion of the defendant-appellant to dismiss the amended complaint for failure to state a cause of action.

The plaintiffs are an attorney and his professional corporation. The defendant-appellant is an attorney for several people who are guarantors in a loan transaction where money was borrowed from a small business investment company, ESIC Capital, Inc.

The defendant-appellant commenced a class action, which several years later has still not been consummated, that contained derogatory allegations against the plaintiffs as being principals in ESIC and substantially alleging that they took advantage of their situation and of the parties with whom they dealt. Understandably, the plaintiffs were perturbed by this and commenced a defamation action against the guarantors and their counsel. The counsel is the defendant-appellant.

While absolute immunity attaches in judicial proceedings (Toker v Pollak, 44 NY2d 211, 219), it is the contention of the plaintiffs that the counsel for the defendants acted maliciously in commencing the class action and exceeded the proper bounds in his allegations and that, therefore, the immunity should fall. (See, Clark v McGee, 49 NY2d 613, 618.)

For the purpose of the motion it can be conceded that the conduct may have been reprehensible and the motivation malicious; nonetheless, it was solely within the realm of the judicial proceeding and relevant to it. (See, ATI, Inc. v Ruder & Finn, 42 NY2d 454; Seltzer v Fields, 20 AD2d 60 [Breitel, J.], affd without opn 14 NY2d 624; Relevancy of Matter Contained in Pleading as Affecting Privilege Within Law of Libel, Ann., 38 ALR3d 272, 279.)

While the plaintiffs allege loss of income, there has been no pleading of special damages, and the plaintiffs cannot establish special damages as a matter of law. (Aronson v Wiersma, 65 NY2d 592.)

This case is similar to that of the physician wrongfully accused in a complaint for malpractice, who sues the malpractice plaintiff and counsel for an intentional wrong. (Drago v Buonagurio, 46 NY2d 778.)

Under the circumstances, there is no cause of action.