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The New York Commercial Division was created in 1993 “to test whether it would be possible, by concentrating on commercial litigation, to improve the efficiency with which such matters were addressed by the court and, at the same time, to enhance the quality of judicial treatment of those cases.”  By implementing rules and procedures developed with efficiency in mind and after careful consultation with Judges and practitioners alike, the Commercial Division has become a resounding success; it is one of the most efficient and effective forums in the world for the litigation of complex civil disputes.

It should therefore come as no surprise that other New York courts have taken notice of the innovative rule changes contributing to the success of the Commercial Division.  As Chief Administrative Judge Marks observes: “through the work of the Commercial Division Advisory Council – a committee of commercial practitioners, corporate in-house counsel and jurists devoted to the Division’ s excellence – the Commercial Division has functioned as an incubator, becoming a recognized leader in court system innovation, and demonstrating an unparalleled creativity and flexibility in development of rules and practices.”

Now, by Administrative Order effective February 1, 2021, the Uniform Civil Rules for the Supreme Court (the “Uniform Rules”) will incorporate, in whole or in part, nearly 30 Commercial Division Rules.  Some of these changes were foreshadowed by my colleague Paige Bartholomew in 2018 when the Unified Court System’s Advisory Committee on Civil Practice requested public comment on whether to adopt nine of the Commercial Division’s Rules.  
Continue Reading Innovation Becomes the Norm: Commercial Division Rules Shape Revised Uniform Rules for the Supreme Court and County Court

The statutes of limitations set forth in the CPLR are default rules, and parties generally are free to modify default rules by agreement.  But statutes of limitations also further the important public interests, such as avoiding stale claims and giving repose to our affairs.  In light of the public interests involved, there are substantial limits on how much parties can agree to lengthen, shorten, or waive the limitations periods applicable to claims arising under New York law.

For example, while parties can agree to a shorter limitations period than prescribed by the CPLR, a recent case by Albany County Commercial Division Justice Richard Platkin serves as a sharp reminder that a contractually shortened limitations period must be reasonable under the circumstances and, in many cases, the reasonableness of such an agreement depends not only on the length of the limitations period itself, but also on the accrual date.Continue Reading Expect Careful Scrutiny of Contractually Shortened Statutes of Limitations

In 2015, our colleagues in the white-collar criminal defense bar braced for the impact of a memorandum penned by then Deputy Attorney General Sally Yates.  The Yates Memo encouraged both federal prosecutors and civil enforcement attorneys to make increased efforts to hold culpable individuals accountable for corporate misconduct.

The Yates Memo embodied the precept

A familiar fact pattern: ParentCo is the owner and controlling shareholder of SubCo.  ParentCo completely controls SubCo.  The two companies have the same officers, issue consolidated financial returns, and the profits and losses of SubCo are passed through to ParentCo.  ParentCo deliberately keeps SubCo in a cash-starved and undercapitalized state, so SubCo is entirely dependent

Disputes over the scope of insurance coverage are common fixtures in the Commercial Division Courts.  Earlier this month, the First Department partially affirmed Justice Sherwood’s decision in Westchester Fire Ins. Co. v. Schorsch et al.  Considering a matter of first impression in the New York Commercial Division Courts, the decision holds that a D&O policy’s

It works the same way in small businesses as it does in major investment firms: the executives reach agreement on the terms of a deal, then leave the lawyers to paper things accordingly.  But sometimes the papered deal differs from the agreement the parties actually reached, and neither side notices the differences until long after

As we continue to see increased litigation over electronic programs, apps, and algorithms, courts are increasingly called to consider discovery requests for the coding behind that technology.  These requests highlight the tension between the need for broad discovery and the litigant’s proprietary interest in secret, commercially valuable source code.  And as a recent First Department