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Reif v. Nagy - 2017 NY Slip Op 02920, 149 A.D.3d 532, 52 N.Y.S.3d 100 (App. Div.)

Rule:

Collateral estoppel requires the issue to be identical to that determined in the prior proceeding, and requires that the litigant had a full and fair opportunity to litigate the issue.

Facts:

Two pieces  of art, by the artist Egon Schiele, were allegedly looted during World War II from cabaret artist Fritz Grunbaum. The pieces came into the possession of art dealer Nagy sometime after 2013. In 2005, David Bakalar, a Massachusetts industrialist turned sculptor, brought suit against the heirs of Grunbaum seeking a declaration that he was the rightful owner of the Schiele work "Seated Woman," a piece he had owned for over 40 years. That case was dismissed based on the doctrine of laches. In the instant action, Nagy also sought dismissal of the case for failure to state a cause of action contending that the plaintiffs are collaterally estopped from pursuing their claims to two other Schiele pieces based on the doctrine of laches.

Issue:

Should plaintiffs' claim be dismissed?

Answer:

Yes.

Conclusion:

The court held that the claim should be dismissed for failure to state a cause of action under NY CLS Gen Bus § 349. The transaction at issue, a single attempted transaction, to which plaintiffs were not a party but an alleged "competitor," was not the type of consumer-oriented harm contemplated by the statute. Nagy sought dismissal based on collateral estoppel resulting from another case involving other works owned by Grunbaum, which was decided on the doctrine of laches. Collateral estoppel required the issue to be identical to that determined in the prior proceeding, and required that the litigant had a full and fair opportunity to litigate the issue. Dismissal based on collateral estoppel was misplaced in the instant case because no requirements had been shown where the purchaser, the pieces, and the time over which the pieces were held differed significantly. The works were not part of a collection unified in legal interest such to impute the status of one to another 

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