Commercial Division Blog

Posted: February 2, 2022 / Written by: Jeffrey M. Eilender, Samuel L. Butt, Christopher R. Dyess, Joshua Wurtzel, Hillary S. Zilz / Categories Motion to Dismiss; Motion for Judgment on the Pleadings, Contracts

Denial of Motion to Dismiss on Legal Grounds Does Not Necessarily Entitle Plaintiff to Summary Judgment

On January 5, 2022, Justice Margaret Chan of the New York County Commercial Division issued a decision in SL Globetrotter, L.P. v. Suvretta Capital Mgmt., LLC, 2022 N.Y. Slip Op. 30076(U), denying a plaintiff's motion for summary judgment on liability and rejecting the plaintiff's argument that the court's decision denying defendants' motion to dismiss entitled plaintiff to summary judgment, explaining:

In this case, although Justice Sherwood found that based on the disclaimers in the Investor Presentation and Subscription Agreements that the breach of contract claim was sufficient to state a cause of action despite the material differences between the financial information provided in the Investor Presentation and the preliminary proxy and the subsequent proxy statements, such a finding is insufficient to demonstrate that plaintiffs are entitled a judgment as a matter of law based on documentary evidence (Caso v Miranda Sambursky Slone Sklarin Verveniotis LLP, 180 AD3d 611, 613, 120 N.Y.S.3d 305 [1st Dept 2020], appeal denied 36 N.Y.3d 959, 137 N.Y.S.3d 289, 161 N.E.3d 477 [2021][noting that "the court's prior decision...decided under the more liberal standards applicable to a motion to dismiss...is not inconsistent with [a contrary] summary judgment adjudication"]).

On a motion to dismiss, the court assumes the truth of the well pled allegations and decides only whether the plaintiff has stated a claim. But on a motion for summary judgment, the court examines the evidence on both sides and determines whether any reasonable factfinder could find for the nonmovant. Thus, it is entirely conceivable--as this case shows--that a plaintiff may defeat a motion to dismiss seemingly premised on legal grounds while being denied summary judgment on its claims.

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning the differing standards on a motion to dismiss and a motion for summary judgment,