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United States District Court for the Southern District of New York
June 21, 2022, Decided; June 21, 2022, Filed
OPINION AND ORDER
VALERIE CAPRONI, United States District Judge:
Avraham Yehuda sued Moshe Zuchaer, Zuchaer & Zuchaer Consulting Inc. ("Z&Z Inc."), and Zuchaer & Zuchaer Consulting LLC ("Z&Z LLC") for equitable accounting, common-law fraud, and a number of other claims, alleging that Zuchaer failed to abide by a purported agreement to share profits from the development of two commercial real estate properties in Texas (the "Texas Properties"). Am. Compl., Dkt. 15 ¶¶ 1-3; Control Agreement, Dkt. 15-1 at 2. Defendants moved to dismiss for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. Notice of Mot., Dkt. 21. Because the Court does not have personal jurisdiction over Zuchaer, Z&Z Inc., or Z&Z LLC, the motion is GRANTED.
Yehuda, a citizen of Israel, claims that in March 2009 he entered into an agreement (the "Control Agreement") with Zuchaer, a citizen of Florida, to develop and sell the Texas Properties and to divide profits from [*2] the venture, with 33% of the profits going to Yehuda and 67% going to Zuchaer. Am. Compl. ¶¶ 1-3; Control Agreement at 2. Yehuda alleges that Zuchaer promised to transfer the Texas Properties to Z&Z Inc., his wholly-owned corporation, and then to transfer 33% of the shares of Z&Z Inc. to Yehuda. Am. Compl. ¶ 19. Yehuda claims that although Zuchaer transferred him 33% of the shares of Z&Z Inc., instead of transferring the Texas Properties to Z&Z Inc. as promised, Zuchaer transferred the Texas Properties to Z&Z LLC, a company wholly owned by Zuchaer. Id. ¶¶ 6, 12-22, 51. Yehuda alleges that Z&Z LLC was incorporated without his knowledge in April 2009, "a little more than a month" after the Z&Z Inc. stock transfer. Id. ¶ 23. Yehuda argues that the transfer of the Texas Properties to Z&Z LLC constitutes a violation of the Control Agreement. Id. ¶¶ 8-9.
In August 2018, Z&Z LLC sold the Texas Properties to Project Verte ("PV"), a corporation, in exchange for a promissory note in the amount of $4,000,000. Id. ¶¶ 5, 21, 22. After PV allegedly refused to pay as required under the promissory note, Z&Z LLC sued PV; that lawsuit was brought in the Southern District of New York as required by the [*3] forum selection clause in the promissory note. Id. ¶ 25. That action is currently pending before the Honorable Judge Victor Marrero. See Zuchaer & Zuchaer Consulting LLC v. Project Verte, No. 20-CV-8703 (the "PV Action").
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2022 U.S. Dist. LEXIS 109915 *; 2022 WL 2209372
AVRAHAM YEHUDA, Plaintiff, -against- MOSHE ZUCHAER, ZUCHAER & ZUCHAER CONSULTING INC., ZUCHAER & ZUCHAER CONSULTING LLC., Defendants.
lawsuit, personal jurisdiction, Properties, confer, motion to dismiss, lack of personal jurisdiction, long-arm