# Maidenbaum v. Marcus

> District Court, E.D. New York · March 4, 2025

URL: https://www.frixlaw.com/law-library/cases/10816662

## Case

- **Court:** District Court, E.D. New York
- **Decided:** March 4, 2025
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10816662

## How later opinions describe it (automated extraction)

- finding stock certificates “available pursuant to CPLR 5232(b) to be levied upon by seizure and sold[.]”
- finding knowledge of the fraud to be an element in a common law fraud claim

## Opinion text

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

-----------------------------------X

SHALOM S. MAIDENBAUM,

Plaintiff,
MEMORANDUM & ORDER

- against - No. 23-cv-3039 (KAM)(ARL)

SEYMOUR H. MARCUS A.K.A.
SY H. MARCUS, ELLEN REA MARCUS,

Defendants.

-----------------------------------X

KIYO A. MATSUMOTO, United States District Judge:

Plaintiff Shalom S. Maidenbaum (“Plaintiff”) commenced the
instant diversity action against Defendants Seymour H. Marcus (“Sy
Marcus”) and Ellen Rea Marcus (“Ellen Marcus”) (collectively,
“Defendants”), alleging tortious interference with enforcement of
a judgment (“Count One”), and aiding and abetting a fraudulent
conveyance and conspiracy to defraud (“Count Two”). (ECF No. 14,
Amended Complaint (“Am. Compl.”) ¶¶ 40-63.) Presently before the
Court is Defendants’ motion to dismiss under Federal Rules of Civil
Procedure 12(b)(1), 12(b)(2), and 12(b)(6), or, in the
alternative, judgment on the pleadings under Federal Rule of Civil
Procedure 12(c) (ECF No. 65, “Mot.”). Defendants argue that (1)
the Court lacks subject-matter jurisdiction, (2) the Court lacks
personal jurisdiction, and (3) Plaintiff has failed to state a
claim upon which relief may be granted.
For the reasons herein, the Court concludes that: (1) the
Court has subject-matter jurisdiction over Plaintiff’s claims, (2)
the Court may exercise personal jurisdiction based on Defendants’

contacts and actions in New York, and (3) Plaintiff has alleged
sufficient facts to state a claim as to Count One, but fails to
state a claim as to his aiding and abetting fraudulent conveyance
claim in Count Two. Accordingly, Defendants’ motion to dismiss is
DENIED in part and GRANTED in part. Plaintiff is GRANTED thirty
(30) days from the entry of this Memorandum and Order to amend his
fraudulent conveyance claims.
BACKGROUND
The Court accepts the allegations in Plaintiff’s Amended
Complaint as true for the purpose of resolving Defendants’ motion
to dismiss under Rule 12(b)(6). J.S. ex rel N.S. v. Attica Cent.
Sch., 386 F.3d 107, 110 (2d Cir. 2004).
I. Factual Background

Plaintiff, Shalom S. Maidenbaum, is a New York resident
seeking to collect judgments entered in his favor against judgment
debtors Aaron Fischman (“Fischman”), Cardis Enterprises
International, B.V., Cardis Enterprises International, N.V.,
Cardis Enterprises International (USA), Inc, and Choshen Israel,
LLC (collectively “Judgment Debtors,” or excluding Fischman,
“Cardis”). (Am. Compl. ¶¶ 1, 4, 11.) Fischman was a New York
resident at the time of the events alleged in the Amended
Complaint. (Id. ¶ 9(b).)
Cardis, founded by Fischman, was promoted as an investment
opportunity based on claims that it owned highly valuable

developmental stage credit card processing technology with
potential applications for cryptocurrency transactions. (Id.
¶ 13.) Substantial amounts of Cardis’ receipts were paid to
accounts in the name of Lawrence Katz, Esq. (“Katz”), an attorney
for Cardis. (Id. ¶ 14.) Instead of forwarding all amounts to
Cardis, Katz would divert portions of the funds to Fischman’s wife,
Nina Fischman, and other individuals, businesses or charities
associated with Fischman. (Id.) Fischman also diverted portions
of his executive compensation to his wife, and then to a trust
controlled by his wife. (Id. ¶ 15.)
Plaintiff and other investors sued Fischman and Cardis
alleging securities fraud in connection with the solicitation of

their investments and Fischman’s misappropriation of their capital
contributions to Cardis.1 (Id. ¶ 17.) On February 23, 2015,
Plaintiff obtained two promissory notes from Cardis, Chosen and
Fischman in the amounts of $2,000,000 and $275,000. (Id. ¶ 12.)
Neither note was paid upon maturity. (Id.) In June 2016,
Plaintiff sought and obtained two judgments by confession against

1 Fischman’s fraudulent activities in connection with Cardis led to his
indictment in 2020 on charges of securities fraud, grand larceny, money
laundering and conspiracy. (Am. Compl. ¶ 18.) Fischman pled guilty to
criminal violations of General Business Law § 352-c(5) in 2022. (Id.)
Cardis, Chosen and Fischman in the amounts $2,576,446.78 and
$355,542.98 (“State Court Judgments”). (Id. ¶ 11.) The total
amount due at the filing of the Amended Complaint, including post-

judgment interest from the State Court Judgments, is
$4,734,457.92. (Id. ¶ 12.) Plaintiff alleges that the diversions
of Cardis’ receipts and Fischman’s compensation, as well as other
fraudulent conveyances, prevented Plaintiff from collecting any
portion of his judgment. (Id. ¶ 16.)
In 2018, during Plaintiff’s collection efforts, Fischman
founded a new company named Ultimas, Inc., which was later renamed
to Ultimax Digital, Inc. (“Ultimax”). (Id. ¶ 19.) Fischman was
originally the sole or controlling shareholder in Ultimax. (Id.)
Immediately after Ultimax’s formation, Fischman took steps to
transfer Cardis’ intellectual property rights and developmental
technology to Ultimax. (Id. ¶ 20.) Specifically, Cardis licensed

to Ultimax a source code (the “Source Code”) that was critical to
the technology that Cardis had intended to develop. (Id.) Ultimax
also hired software engineers and consultants who had previously
worked for Cardis, and possessed unique understandings of the
Source Code. (Id.)
Plaintiff issued subpoenas to Fischman, Ultimax, and
Ultimax’s Chief Executive Officer, Jesse Sutton (“Sutton”), as
part of his effort to locate, restrain, and levy on Fischman’s
shares in Ultimax and identify appropriate garnishees for those
shares. (Id. ¶ 22.) Despite Plaintiff obtaining several court
orders between 2018 to 2022 directing compliance with Plaintiff’s
subpoenas, neither Fischman, Ultimax nor Sutton complied with the
subpoenas. (Id.) As a result, Plaintiff was unable to collect
any portion of his judgment. (Id.)

To continue to frustrate Plaintiff’s collection efforts,
Fischman engaged in various schemes that involved transferring his
Ultimax stock to various individuals or entities in exchange for
either: (1) cash deposits to various bank accounts out of
Plaintiff’s reach, such as bank accounts that Plaintiff did not
know about, bank accounts previously unrestrained because of its
minimal balances at the time of the CPLR § 5222 notice, and bank
accounts in the name of Fischman’s wife, but controlled by
Fischman, (2) past or future legal services by attorneys in defense
of Plaintiff’s collection efforts, or (3) payments to attorneys.
(Id. ¶ 26.)

Defendants, Seymour “Sy” Marcus and Ellen Marcus, are husband
and wife and citizens of either Massachusetts or Florida. (Id. ¶¶
3, 6, 7.) Plaintiff alleges that, as part of Fischman’s scheme to
frustrate Plaintiff’s attempts at collection, Fischman transferred
a portion of his Ultimax shares to entities over which Defendants
exercised de facto control in exchange for consideration in the
form of cash deposits into accounts, payment of past or future
legal services, which Plaintiff could not execute upon. (Id. ¶¶
27, 30.) Defendants’ entities included the Level Up Revocable
Trust, Copper Trust, SMB Trust, Symar Irrevocable Trust, Jomar
Irrevocable Trust and Pamar Irrevocable Trust. (Id. ¶ 28.)

In consideration for Fischman’s transfers of Ultimax stock to
Defendants’ entities, Sy Marcus agreed with law firm Kasowitz
Benson Torres LLP (“Kasowitz”) in a contract executed on July 21,
2021, to pay Fischman’s legal fees for services provided by
Kasowitz in connection with Fischman’s New York state criminal
case. (Id. ¶ 30.) Plaintiff alleges that this agreement between
Kasowitz and Sy Marcus was later informally expanded to cover
payments for other legal work rendered to Fischman, including legal
work opposing Plaintiff’s collection efforts. (Id. ¶ 32.)
As part of Defendants’ alleged scheme, Defendants made three
direct payments to Kasowitz totaling $430,000 for Fischman’s legal
defense. (Id. ¶ 33.) Specifically, Defendants paid $125,000 to

Kasowitz on June 7, 2022, $105,000 on July 7, 2022, and $200,000
on July 27, 2022. (Id.) Plaintiff alleges that Defendants made,
participated, and facilitated these payments to Kasowitz by
ordering wire transfers out of a so-called “house account” for the
Defendants’ family businesses. (Id. ¶¶ 34, 35.) In addition to
the $430,000 of direct payments, Kasowitz also received an
additional $1,089,933.52 in untraceable payments made on
Fischman’s behalf. (Id. ¶ 37.) As Defendants were contractually
obligated to pay Fischman’s legal fees with Kasowitz, Plaintiff
alleges that Defendants were also the source of the untraceable
payments made to Kasowitz. (Id.)
Plaintiff further alleges that Defendants were fully aware

that they were helping Fischman evade Plaintiff’s judgment
collection efforts. (Id. ¶ 33.) First, Plaintiff alleges that
Defendants had received invoices from Kasowitz identifying its
work as “Frozen accounts-Preliminary Assessment” – referencing a
frozen Fischman family trust account pursuant to Plaintiff’s
restraining notice. (Id. ¶ 36.) Second, on July 23, 2021,
Defendant Sy Marcus met with Plaintiff and Plaintiff’s counsel in
Cedarhurst, New York, and discussed Plaintiff’s judgments against
Fischman. (Id.) At this meeting, Marcus acknowledged that he had
known about Plaintiff’s judgments against Fischman for several
years. (Id.)
Plaintiff alleges that, as a result of Defendants’ scheme

with Fischman, he has been unable to execute on his judgment and
has incurred over $500,000 in attorneys’ fees in his efforts to
execute on Fischman’s personal property, including Fischman’s
Ultimax common stock. (Id. ¶¶ 38, 39.)
II. Procedural Background
On July 17, 2023, Plaintiff filed the instant Amended
Complaint, asserting claims of (1) tortious interference with
enforcement of a judgment, and (2) aiding and abetting a fraudulent
conveyance and conspiracy to defraud. (Id. ¶¶ 40-63.) Plaintiff
seeks compensatory damages in an amount no less than $930,000,
punitive damages in an amount no less than $2,000,000, and
interest, costs, and fees. (Id. at 16.)

On July 31, 2023, Defendants moved for a pre-motion conference
to discuss its anticipated motion to dismiss pursuant to Federal
Rules of Civil Procedure 12(b)(2) and 12(b)(6). (See ECF No. 15.)
Plaintiff responded to Defendants’ letter motion for a pre-motion
conference on August 3, 2023. (See ECF No. 16.) On August 23,
2023, the Court held a pre-motion conference to discuss Defendants’
anticipated motion to dismiss and directed the parties to engage
in jurisdictional discovery regarding Defendants’ contacts and
actions in New York. (See Minute Entry dated August 23, 2023.)
On August 20, 2024, Defendants’ fully briefed motion to dismiss
was filed with the Court. (See ECF Nos. 64, 65, 66, 67.) The
Court now considers Defendants’ motion to dismiss.

LEGAL STANDARD
Defendants move to dismiss this action under Federal Rules of
Civil Procedure 12(b)(1) for lack of subject matter jurisdiction,
12(b)(2) for lack of personal jurisdiction, and 12(b)(6) for
failure to state a claim. In the alternative, Defendants move for
judgment on the pleadings under Federal Rule of Civil Procedure
12(c). (Mot. at 1.)
I. Motion to Dismiss for Lack of Subject-Matter Jurisdiction
A motion to dismiss under Rule 12(b)(1) challenges the
court’s subject-matter jurisdiction to adjudicate the action.
Brokamp v. James, 66 F.4th 374, 386 (2d Cir. 2023). The plaintiff
has the burden to establish subject-matter jurisdiction by a
preponderance of the evidence. Collins v. United States, 996 F.3d

102, 108 (2d Cir. 2021). In resolving a motion under Rule
12(b)(1), the Court may consider affidavits or other materials
beyond the pleadings. Harty v. West Point Realty, Inc., 28 F.4th
435, 441 (2d Cir. 2022).
II. Motion to Dismiss for Lack of Personal Jurisdiction
On a motion to dismiss for lack of personal jurisdiction
pursuant to Federal Rule of Civil Procedure 12(b)(2), “the
plaintiff bears the burden of establishing that the court has
jurisdiction over the defendant.” DiStefano v. Carozzi North
America, Inc., 286 F.3d 81, 84 (2d Cir. 2001) (citation omitted).
“[T]he showing a plaintiff must make to defeat a defendant’s claim
that the court lacks personal jurisdiction over it ‘varies

depending on the procedural posture of the litigation.’”
Dorchester Financial Securities, Inc. v. Banco BRJ, S.A., 722 F.3d
81, 84 (2d Cir. 2013) (quoting Ball v. Metallurgie Hoboken-
Overpelt, S.A., 902 F.2d 194, 197 (2d Cir. 1990)).
Before jurisdictional discovery, a plaintiff’s prima facie
showing of jurisdiction “may be established solely by
allegations.” Ball, 902 F.2d at 197. However, where
jurisdictional discovery has been conducted, a plaintiff’s prima
facie showing must be factually supported; that is, it must
“include an averment of facts that, if credited by [the ultimate
trier of fact], would suffice to establish jurisdiction over the
defendant.” Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d

560, 567 (2d Cir. 1996) (quoting Ball, 902 F.2d at 197). In
assessing the plaintiff’s showing, the court applies a “standard
. . . akin to that on a motion for summary judgment,” construing
the “pleadings documents, and other evidentiary materials . . . in
the light most favorable to the plaintiff and all doubts are
resolved in [his or her] favor.” Melnick v. Adelson-Melnick, 346
F. Supp. 2d 499, 503 (S.D.N.Y. 2004) (citations and internal
quotation marks omitted).
III. Motion to Dismiss for Failure to State a Claim
On a Rule 12(b)(6) motion to dismiss, the Court must assume
the truth of “all well-pleaded, nonconclusory factual allegations
in the complaint.” Kiobel v. Royal Dutch Petroleum Co., 621 F.3d
111, 123 (2d Cir. 2010) (citing Ashcroft v. Iqbal, 556 U.S. 662,

677 (2009)). A complaint must plead sufficient facts to “state a
claim to relief that is plausible on its face.” Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial
plausibility when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. In
resolving a motion under Rule 12(b)(6), the Court must limit its
consideration to the complaint, documents incorporated by
reference into the complaint, documents not incorporated but
nonetheless integral to the complaint, and matters properly
subject to judicial notice. Clark v. Hanley, 89 F.4th 78, 93 (2d
Cir. 2023) (citing Goel v. Bunge, Ltd., 820 F.3d 554, 559 (2d Cir.

2016)).
IV. Motion for Judgment on the Pleadings
Rule 12(c) provides that “[a]fter the pleadings are closed—
but early enough not to delay trial—a party may move for judgment
on the pleadings.” Fed. R. Civ. P. 12(c). “Pleadings” include
both the “complaint” and the “answer to [the] complaint.” Fed. R.
Civ. P. 7(a).
“The standard for granting a Rule 12(c) motion for judgment
on the pleadings is identical to that for granting a Rule 12(b)(6)
motion for failure to state a claim.” Lynch v. City of New York,
952 F.3d 67, 75 (2d Cir. 2020) (cleaned up). “To survive a Rule

12(c) motion, [the plaintiff’s] complaint must contain sufficient
factual matter, accepted as true, to state a claim to relief that
is plausible on its face. Hayden v. Paterson, 594 F.3d 150, 160
(2d Cir. 2010) (cleaned up). “The assessment of whether a
complaint’s factual allegations plausibly give rise to an
entitlement to relief . . . calls for enough fact[s] to raise a
reasonable expectation that discovery will reveal evidence of
illegal conduct.” Lynch, 952 F.3d at 75 (internal quotation marks
omitted). In making this assessment, we “draw all reasonable
inferences in [the plaintiff’s] favor.” Johnson v. Rowley, 569
F.3d 40, 43 (2d Cir. 2009).

DISCUSSION
Defendants seek to dismiss this action based on lack of
subject-matter jurisdiction, lack of personal jurisdiction, and
Plaintiff’s failure to state a claim upon which relief may be
granted. Each argument will be addressed in turn.
I. Subject Matter Jurisdiction
The Court first addresses subject-matter jurisdiction because
the Court cannot proceed further with an action it has no power to
adjudicate. See Coniglio v. Garland, 556 F. Supp. 3d 187, 194
(E.D.N.Y. 2021). Plaintiff invokes the Court’s diversity
jurisdiction under 28 U.S.C. § 1332. (Am. Compl. ¶ 4.) For the
reasons below, the Court concludes that it has diversity
jurisdiction over Plaintiff’s claims.

Under the federal diversity statute, federal district courts
have original subject-matter jurisdiction over civil actions
between citizens of different states where the amount in
controversy exceeds $75,000 excluding interest and costs. See 28
U.S.C. § 1332(a)(1). The parties must be completely diverse,
meaning that no plaintiff may be a citizen of the same state as
any defendant. See OneWest Bank, N.A. v. Melina, 827 F.3d 214,
217-18 (2d Cir. 2016). For diversity purposes, an individual
person is a citizen of the state where he or she is “domiciled.”
Van Buskirk v. United Group of Cos., Inc., 935 F.3d 49, 53–54 (2d
Cir. 2019).

Plaintiff has alleged, and Defendants do not dispute, that
the parties are completely diverse. Plaintiff is a citizen of New
York. (Am. Compl. ¶ 1.) Defendants Sy Marcus and Ellen Marcus
are citizens of either Massachusetts or Florida, but in any event
are not citizens of New York. (Id. ¶¶ 2, 3.) Thus, the Court
concludes that because no plaintiff is a citizen of the same state
as any defendant, the complete diversity requirement is met.
Defendants argue that, despite complete diversity, the Court
still lacks subject matter jurisdiction because Plaintiff has not
adequately pled the $75,000 amount-in-controversy requirement.
(Mot. at 22-25.) The Court disagrees. A plaintiff has only a
minimal burden to satisfy the federal diversity statute’s amount-

in-controversy requirement. Courts presume that a plaintiff’s
good faith allegation about the amount in controversy controls
unless it appears to a legal certainty that the plaintiff cannot
recover that amount. St. Paul Mercury Indem. Co. v. Red Cab Co.,
303 U.S. 283, 288-89 (1938); accord Pyskaty v. Wide World of Cars,
LLC, 856 F.3d 216, 223 (2d Cir. 2017).
Here, though the Court does not, and need not, credit
Plaintiff’s bald assertion that “the value of [his] claims in this
action, exclusive of interest and costs, exceeds $75,000[,]” (Am.
Compl. ¶ 8), the Court finds that Plaintiff’s underlying factual
allegations sufficiently allege an amount-in-controversy exceeding
$75,000. Plaintiff alleges that, because of Defendants’ actions,

Plaintiff was unable to seize or execute on Fischman’s assets in
satisfaction of Plaintiff’s two judgments of confession totaling
$4,734,457.92. (Id. ¶ 4.) Moreover, Plaintiff alleges that
Defendants have wired at least $430,000 to Kasowitz in satisfaction
of Fischman’s legal bills, thereby placing their assets out of
Plaintiff’s reach. (Id. ¶¶ 33, 37.)
Given these allegations, and assuming that Defendants’
actions tortiously caused those losses, it does not appear to a
legal certainty that Plaintiff could not recover $75,000 in this
action. Thus, the Court has subject matter jurisdiction over the
claims in this action under the federal diversity statute and will
proceed to Defendants’ other arguments.
II. Personal Jurisdiction

Having established subject-matter jurisdiction, the Court now
turns to Defendants’ arguments regarding personal jurisdiction.
To ensure that the exercise of personal jurisdiction is
proper, the district court must determine, first, whether there is
a statutory basis for the exercise of such jurisdiction. See Boyce
v. Cycle Spectrum, Inc., 148 F. Supp. 3d 256, 263-64 (E.D.N.Y.
2015). In New York, there are two potential statutory bases for
personal jurisdiction: (1) N.Y. C.P.L.R. § 301 provides the basis
for general personal jurisdiction, and (2) N.Y. C.P.L.R. § 302,
New York’s so-called Long-Arm Statute, provides the basis for
specific jurisdiction. See Boyce, 148 F. Supp. 3d at 263-65.

After determining whether a statutory basis exists for personal
jurisdiction, a court must separately evaluate whether the
exercise of personal jurisdiction comports with due process. See
Brown v. Lockheed Martin Corp., 814 F.2d 619, 625 (2d Cir. 2016).
Plaintiff focuses his argument in support of personal
jurisdiction solely on the long-arm statute, C.P.L.R. § 302(a)(1).
(See ECF No. 66, “Opp.” at 3-5.) Thus, the Court does not address
the other subdivisions of C.P.L.R. §§ 301 and 302. As detailed
below, the Court finds that Defendants are subject to personal
jurisdiction in New York.
A. C.P.L.R. § 302(a)(1) – Transaction of Business or
Contract to Supply Goods/Services in New York
Plaintiff asserts that Defendants are subject to personal
jurisdiction under C.P.L.R. § 302(a)(1), which states that “a court
may exercise personal jurisdiction over any non-domiciliary . . .
who in person or through an agent . . . transacts any business
within the state or contracts anywhere to supply goods or services
in the state[.]” C.P.L.R. § 302(a)(1). The Court agrees.
There are two requirements under § 302(a)(1) for a court to

exercise jurisdiction over a non-domiciliary defendant. First,
the defendant must have transacted business in New York. As the
Second Circuit has instructed, “the overriding criterion necessary
to establish a transaction of business [under § 302(a)(1)] is some
act by which the defendant purposefully avails itself of the
privilege of conducting activities within New York.” Licci ex
rel. Licci v. Lebanese Canadian Bank, SAL, 673 F.3d 50, 61 (2d
Cir. 2012) (citing Ehrenfeld v. Bin Mahfouz (“Licci I”), 9 N.Y.3d

501, 508 (N.Y. 2007)). “To determine whether a party has
‘transacted business’ in New York, courts must look at the totality
of circumstances concerning the party’s interactions with, and
activities within, the state.” Bank Brussels Lambert v. Fiddler
Gonzalez & Rodriguez, 171 F.3d 779, 787 (2d Cir. 1999) (Sotomayor,
J.).
The second requirement, known as the “nexus” prong of
§ 302(a)(1), holds that there must be an “articulable nexus” or
“substantial relationship” between the plaintiff’s claim and the
defendant’s transaction in New York. See Best Van Lines, Inc. v.
Walker, 490 F.3d 239, 246 (2d Cir. 2007) (quoting Henderson v.

INS, 157 F.3d 106, 123 (2d Cir. 1998)). The nexus prong requires
only a “relatedness . . . such that the latter is not completely
unmoored from the former.” Licci v. Lebanese Canadian Bank, SAL
(“Licci II”), 984 N.E.2d 893, 900 (N.Y. 2012). This “relatively
permissive” nexus is satisfied where “at least one element [of the
plaintiff’s claim] arises from the [defendant’s] New York
contacts.” Id. at 900-01.
Upon a motion to dismiss for lack of personal jurisdiction,
“[t]he facts alleged in the complaint and affidavits in opposition
to such a motion to dismiss are deemed true and construed in the

light most favorable to the plaintiff, and all doubts are to be
resolved in favor of the plaintiff.” Fanelli v. Latman, 202 A.D.3d
758, 759 (2d Dept. 2022). Here, the Amended Complaint alleges
that Defendants, together with New York resident Fischman,
executed a letter agreement with Kasowitz, a New York law firm,
for Kasowitz to provide legal services in Fischman’s New York
criminal case. (Am. Compl. ¶¶ 30-31.) Defendant Sy Marcus later
expanded the scope of Kasowitz’s retention to cover legal work in
opposition to Plaintiff’s collection efforts. (Id. ¶ 32.)
Defendant Ellen Marcus then sent three wire transfers directly to
Kasowitz’s New York bank account, which allegedly allowed Fischman
to pay his legal bills without liquidating his Ultimax common
stock. (Id. ¶¶ 33, 35.) Defendants also separately transferred

at least $968,000 into a New York State Interest on Lawyer Account
Fund (“IOLA”) account associated with Fischman’s other attorneys
at Cohen, LaBarbera & Landrigan, LLP – a law firm based in Chester,
New York.2 (Id. ¶ 37; ECF No. 65, “Berry Decl.” Exs. 2, 3, 4.3)

2 An Interest on Lawyer Account is a type of interest-bearing account
used by New York lawyers to hold client funds. See N.Y. Senate, IOLA
and Civil Legal Services FAQ (accessed February 19, 2025),
https://www.nysenate.gov/iola-and-civil-legal-services-faq.

3 On a motion to dismiss for lack of personal jurisdiction, the Court
may also consider Plaintiff’s “affidavits and supporting materials” in
From the amounts deposited in the Cohen IOLA account, $347,500 was
transferred directly to Kasowitz in satisfaction of Fischman’s fee
obligations to that firm, and other sums were transferred directly

to Fischman and to Aurora Equities I. (Berry Decl. Exs. 2, 3, 4,
5.)
Defendants’ actions, as alleged in the Amended Complaint and
in Plaintiff’s declaration, more than suffice to establish
personal jurisdiction over the Defendants. As New York courts
have found, § 302(a)(1) is a “single act statute,” where even “one
transaction in New York is sufficient to invoke jurisdiction [under
§ 302(a)(1)] . . . so long as the defendant’s activities here were
purposeful and there is a substantial relationship between the
transaction and the claims asserted.” Deutsche Bank Secs., Inc.
v. Montana Bd. of Invs., 850 N.E.2d 1140, 1143 (N.Y. 2006)
(internal quotations and citations omitted). Defendants entered

an agreement with New York lawyers for Fischman, for legal services
in New York, and made not one, but multiple wire transfers directly
to New York bank accounts, including a New York-specific IOLA
account. These actions have allowed Defendants to avail themselves
of New York’s contract and banking protections, regulations and
laws.

determining whether a prima facie showing of personal jurisdiction has
been established. Marine Midland Bank, N.A. v. Miller, 664 F.2d 899,
904 (2d Cir. 1981).
Moreover, because Defendants’ wire transfers are precisely
what is at issue in this lawsuit, there is a substantial
relationship between the transactions and Plaintiff’s asserted
claims. See Al Rushaid v. Pictet & Cie, 68 N.E.3d 1, 11–12 (N.Y.

2016) (concluding that the non-domiciliary’s use of a
correspondent bank “was precisely part of the defendant’s design”
to launder profits and that this was sufficient to “show the
minimum level of relatedness” to plaintiff’s claims); see also
Licci II, 984 N.E.2d 893, 901 (finding a substantial relationship
where defendants used New York accounts repeatedly “to move the
necessary” money).
The nexus between Plaintiff’s claims and Defendants’ New York
conduct is premised on more than just Defendants’ wire transfers.
As an element of his tortious interference and fraud claims,
Plaintiff must show that Defendants had knowledge of Plaintiff’s
judgments against Fischman. See Siegel v. Kontogiannis, No. 15-

cv-2856 (MKB)(JO), 2017 WL 9482101, at **4-5 (E.D.N.Y. Mar. 14,
2017) (finding a genuine dispute of material fact regarding
defendants’ knowledge of the underlying judgment precluding
summary judgment on tortious interference claim); Abu Dhabi
Commercial Bank v. Morgan Stanley & Co. Inc., 651 F. Supp. 2d 155,
186 (S.D.N.Y. 2009) (finding knowledge of the fraud to be an
element in a common law fraud claim). Plaintiff alleged that
Defendants acquired that knowledge in several instances, including
during an in-person meeting with Plaintiff in Cedarhurst, New York.
(Am. Compl. ¶ 36.) Defendants argue that a “single meeting” in
New York cannot establish personal jurisdiction. (Mot. at 20.)

Regardless of whether that particular meeting may establish
jurisdiction alone, the Court agrees with Plaintiff that such a
meeting may nevertheless be part of a culmination of conduct that
collectively establishes personal jurisdiction over Defendants.
(Opp. at 5.) See M. Fabrikant & Sons, Inc. v. Adrianne Kahn, Inc.,
144 A.D.2d 264, 265–66 (1st Dept. 1988) (finding jurisdiction where
defendant had a single meeting in New York followed by further
business dealings outside the state).
Furthermore, Defendants had retained and paid Kasowitz, a New
York law firm, for legal services rendered on behalf of Fischman
not only in Fischman’s New York criminal case, but also for
services which potentially challenge Plaintiff’s attempts to

collect on the Fischman judgments. (Am. Compl. ¶¶ 30, 32, 33.)
This, too, serves as a nexus for long-arm jurisdiction. See
Courtroom Tel. Network v. Focus Media, 264 A.D.2d 351, 353 (1st
Dept. 1999) (long-arm jurisdiction established where the defendant
relied on agents “to perform commercial activities in New York for
[their] benefit”).
Defendants nevertheless argue that the Amended Complaint
“does not assert an articulable nexus between the claims and the
few activities Defendants allegedly conducted in New York.” (Mot.
at 19.) As noted above, the Court disagrees. Defendants
themselves note that: (1) Defendants’ trusts “acquired the Ultimax
stock from Fischman when Fischman was in New York[,]” (2)

“Defendants agreed to pay Fischman’s legal fees owed to a non-
party New York law firm[,] (3) “Sy [Marcus] paid Fischman’s legal
fees into the law firm account at a branch in Manhattan[,]” (4)
“Ellen [Marcus] paid those same legal fees into a law firm account
at a branch in Manhattan[,] and” (5) “Sy [Marcus] occasionally
does unrelated business with New York clients.” (Mot. at 19-20.)
Such allegations sufficiently establish personal jurisdiction over
Defendants.
In sum, based on the totality of the circumstances, the Court
finds that Defendants have purposely availed themselves of the
privilege of transacting within New York and are subject to
personal jurisdiction pursuant to C.P.L.R. § 302(a)(1).4
B. Due Process

Having found specific personal jurisdiction to be proper in

4 Though Plaintiff does not argue in his opposition brief that N.Y.
C.P.L.R. §§ 302(a)(2) and 302(a)(3) apply to confer personal jurisdiction
on Defendants, Plaintiff cites to those subdivisions in his Amended
Complaint. (Am. Compl. ¶ 9.) In the interests of completeness, the
Court has reviewed the applicability of §§ 302(a)(2) and 302(a)(3) and
finds that the Amended Complaint and Plaintiff’s declarations fail to
allege that Defendants were either physically present in New York during
the commission of the alleged tort, or derive “substantial” revenue from
their dealings in New York. See Bank Brussels Lambert, 171 F.3d at 778-
91. Plaintiff has not even alleged that Ellen Marcus does business in
New York at all. Thus, Plaintiff fails to allege personal jurisdiction
under §§ 302(a)(2) and 302(a)(3).
New York, the Court has little difficulty further concluding that
the exercise of personal jurisdiction here comports with due
process. See International Shoe Co. v. Washington, 326 U.S. 310

(1945) (finding that courts gain personal jurisdiction over a non-
domiciliary only if that person has “certain minimum contacts
[within the state] such that the maintenance of the suit does not
offend ‘traditional notions of fair play and substantial
justice’”); Hanson v. Denckla, 357 U.S. 235, 251, 253 (1958)
(holding that “minimal contacts” arise where a person acts to avail
himself purposefully of the privilege of conducting business
within a state, thereby gaining the benefits and protection of its
laws). Based on the facts alleged in the Amended Complaint and
articulated above, the Court finds that Defendants have minimum
contacts in New York such that the maintenance of the lawsuit would
not offend traditional notions of fair play and substantial

justice.
Once the plaintiff has made a threshold showing that the
action arises from the defendant’s contacts with the state, the
defendant may nonetheless defeat jurisdiction by presenting “a
compelling case that the presence of some other considerations
would render jurisdiction unreasonable.” Bank Brussels Lambert,
305 F.3d 120, 129. Relevant considerations include: “(1) the
burden that the exercise of jurisdiction will impose on the
defendant; (2) the interests of the forum state in adjudicating
the case; (3) the plaintiff’s interest in obtaining convenient and
effective relief; (4) the interstate judicial system’s interest in
obtaining the most efficient resolution of the controversy; and

(5) the shared interest of the states in furthering substantive
social policies.” Id. As Defendants have not even addressed these
considerations in their briefs, the Court is unpersuaded that this
case is “the exceptional situation where exercise of jurisdiction
is unreasonable even though minimum contacts are present.” Id. at
130 (quotations omitted).
“Because the New York long-arm statute is more restrictive
than the federal due process requirements, by virtue of satisfying
the long-arm statute the minimum contacts and reasonableness
requirements of due process have similarly been met.” Chatwal
Hotels & Resorts LLC v. Dollywood Co., 90 F. Supp. 3d 97, 108
(S.D.N.Y. 2015). As the Second Circuit observed, it would be

“rare” and “unusual” for a court to determine that the exercise of
personal jurisdiction over a defendant was permitted by
§ 302(a)(1), but prohibited under principles of due process. Licci
ex rel. Licci v. Lebanese Canadian Bank, SAL (“Licci III”), 732
F.3d 161, 170 (2d Cir. 2013). In accordance with these principles,
and upon the factual allegations in Plaintiff’s Amended Complaint,
the Court concludes that the exercise of personal jurisdiction
over Defendants in this action comports with due process, and
therefore denies Defendants’ motion to dismiss pursuant to Federal
Rule of Civil Procedure 12(b)(2).
III. Failure to State a Claim
Defendants next argue that (1) Plaintiff’s judgments on
Fischman are invalid, (2) Plaintiff lacks a private right of action

under N.Y. C.P.L.R. article 52, and (3) the Amended Complaint fails
to state a claim for either of Plaintiff’s causes of action. (Mot.
at 4-13, 14-18, 25-26.) The Court will address each argument in
turn.
A. Validity of the Judgments of Confession
Defendants argue that, inter alia, Plaintiff’s judgments of
confession by Cardis, Chosen and Fischman are invalid because the
judgments allegedly omit material information and contradict other
record evidence. (Mot. at 5-15.) Plaintiffs respond, asserting
that the Marcus Defendants may not collaterally attack the
judgments of confession by Cardis, Chosen and Fischman – in
essence, state court judgments – in this federal court action.
(Opp. at 6-8.) The Court finds that the doctrine of res judicata

bars further review, and thus does not reach the parties’ remaining
arguments on the validity of the judgments of confession.5

5 It is unclear whether the Marcus Defendants would have standing to
collaterally attack judgments that they were neither parties to nor
impacted by. See Marino v. Ortiz, 484 U.S. 301, 304 (1988) (per curiam)
(noting that the “better practice” for nonparties affected by a certain
judgment is to intervene in the action rather than to collaterally attack
the judgment through a separate action). In any case, even assuming
Defendants have standing here, their argument nonetheless fails for the
reasons stated in this section.
Under New York law, confessions of judgments are treated like
consent decrees, which are, in turn, treated the same as a final
judgment after trial. See Canfield v. Elmer E. Harris & Co., 170

N.E. 121 (N.Y. 1930) (“A judgment by confession stands in much the
same position as one by stipulation or consent and is conclusive
adjudication of all matters embraced in it and a bar to any
subsequent action on the same claim.”); In re Madison 92nd Street
Associates LLC, 472 B.R. 189, 194 (Bankr. S.D.N.Y. 2012) (“Under
New York law, a consent judgment has the same res judicata effect
as a judgment on the merits.”). A confession of judgment is
therefore treated as any other judgment rendered by a state court,
and federal courts are required to give state court judgments the
same “preclusive effect it would be accorded by the rendering
state.” In re Higgins, 270 B.R. 147, 156 (Bankr. S.D.N.Y. 2001).
Confessions of judgments, like Plaintiff’s judgments against

Fischman, are subject to direct challenge at the time of their
entry. But after the time to challenge has expired or the
challenge has been denied, the judgment is final under longstanding
res judicata principles. Id.
As Plaintiff notes, Fischman had in fact challenged the
confessions of judgments in favor of Plaintiff, in a separate,
related state court action captioned: Fischman v. Jonathan A. Stein
and Shalom Maidenbaum, Index No. 608120/2022 (Sup. Ct. Nassau
Cnty.). (Opp. at 7; Berry Decl. Ex. 7.) In that case, the Nassau
County Supreme Court held that the confessions of judgment by
Cardis, Chosen and Fischman were indeed valid and enforceable.
(Berry Decl. Ex. 7 at 4.) As a result, this Court is prohibited

under the doctrine of res judicata from looking behind the
judgments of confession to consider Defendants’ arguments
regarding validity.
B. N.Y. C.P.L.R. Article 52
Defendants then appear to argue that, as for Count One
“involving a tort arising from a judgment,” Plaintiff would not
have a private right of action and would be limited to bringing an
action under N.Y. C.P.L.R. article 52. (Mot. at 25-26.) Though
Defendants describe this argument as one of subject-matter
jurisdiction, and Plaintiff does not address this argument in his
opposing brief, the Court construes this argument to be for failure
to state a claim.
In support of their argument, Defendants cite Plymouth
Venture Partners, II, L.P. v. GTR Source, LLC, 183 N.E.3d 1185
(N.Y. 2021). Plymouth, however, does not stand for Defendants’

broad proposition that any action related to restraining notices
issued under C.P.L.R. article 52 must be brought in the state court
where the judgment is recorded. (Mot. at 26.) Rather, as the
New York Court of Appeals stated in Plymouth, actions based on
“alleged violations of the procedural requirements of article 52”
must proceed within the mechanisms provided by article 52. Id. at
1192.
Defendants’ reliance on Cruz v. TD Bank is similarly
misplaced. (Mot. at 25.) Cruz had made clear that “common-law

tort claims” – such as Plaintiff’s claims here – were “beyond the
scope of the questions certified to [the Court of Appeals].”
2 N.E.3d 221, 225 (N.Y. 2013). Consistent with Plymouth, Cruz
held only that a plaintiff must sue for procedural violations of
C.P.L.R. article 52 using the mechanisms provided within C.P.L.R.
article 52. Id. at 231.
Here, however, Plaintiff has not asserted claims against
Defendants for procedural violations of C.P.L.R. article 52.
Instead, Count One of Plaintiff’s Amended Complaint asserts that
Defendants, with knowledge of a pending judgment against Fischman,
entered a tortious scheme to interfere with Plaintiff’s ability to
collect on a valid judgment. (Am. Compl. ¶¶ 40-53.) As Defendants

themselves recognize, New York courts have long recognized a
common-law cause of action for tortious interference with the
enforcement of a judgment. (See ECF No. 67, “Reply” at 4.); Quinby
v. Strauss, 90 N.Y. 664, 1882 WL 14577 (N.Y. 1882); James v.
Powell, 25 A.D.2d 1 (1st Dep’t. 1966). Thus, the Court finds that
Plaintiff is not limited to bringing Count One under a C.P.L.R.
article 52 proceeding.
C. Count One – Tortious Interference with Enforcement of
Judgment
Defendants next argue that Plaintiff has failed to state a
claim on Count One because (1) Defendants’ alleged actions in
paying for Fischman’s legal fees in exchange for Ultimax stock is
“neither fraudulent nor otherwise improper,” and (2) Defendants’
alleged actions were not the “but for” cause of Plaintiff’s injury.
(Mot. at 16; Reply at 4-9.) For the reasons stated below, the
Court finds that Plaintiff has sufficiently stated a claim for
tortious interference.
1. Standard of Conduct Required for Tortious
Interference Claims
As discussed above, New York courts have long recognized a
cause of action for tortious interference with the enforcement of
a judgment. See Ritter v. Klisivitch, No. 6-cv-5511, 2008 WL
2967627, at *14 (E.D.N.Y. July 30, 2008) (citing James v. Powell,
25 A.D.2d 1, 3-4 (1st Dept. 1966), rev’d on other grounds, 225

N.E.2d 741 (N.Y. 1967). “At common law, whoever by improper means
interfered with the execution of a judgment was liable for the
damage he caused to the judgment creditor.” James, 25, A.D.2d at
2. “Although applicable case law has not explicitly defined all
of the elements of such a claim, it does make clear that the
[Plaintiff] must establish that [Defendants] used improper means
to interfere with [his] ability to enforce” the judgment. New
Falls Corp. v. Soni Holdings, LLC, No. 2:19-cv-00449 (ADS)(AKT),
2020 WL 13850728, at *7 (E.D.N.Y. Mar. 31, 2020) (citing Siegel,
2017 WL 9482101, at *10).
Defendants assert that, to sustain a claim, Plaintiff must

allege that the Defendants engaged in “improper conduct” that is
independently tortious or criminal. (Reply at 5.) Upon review of
binding New York law, the Court disagrees that Plaintiff must
allege conduct rising to the level of independently tortious or
criminal.
In NBT Bancorp Inc. v. Fleet/Norstar Financial Grp. Inc., the
New York Court of Appeals made clear that “the degree of protection
available to a plaintiff” in a tortious interference claim is
“defined by the nature of the plaintiff’s enforceable legal
rights.” 664 N.E.2d 492, 495-96 (N.Y. 1996). To be specific,
“where there is an existing, enforceable contract and a defendant’s
deliberate interference results in a breach of that contract, a

plaintiff may recover damages for tortious interference with
contractual relations even if the defendant was engaged in lawful
behavior.” Id. at 496. On the other hand, “[w]here there has
been no breach of an existing contract, but only interference with
prospective contract rights . . . plaintiff must show more culpable
conduct on the part of the defendant[.]” Id. In making such a
distinction, the Court of Appeals noted the important balance
struck between “society’s interest in respect for the integrity of
contractual relationships, on the one hand, and, on the other, the
right to freedom of action on the part of the party interfering
and society’s concern that competition not be unduly hampered.”
Id. (citing Guard-Life v. S. Parker Hardware Mfg. Corp., 406 N.E.2d

445, 448 (N.Y. 1980)).
Here, Plaintiff alleges that Defendants tortiously interfered
with the enforcement of two judgments of confession by the Judgment
Debtors. (Am. Compl. ¶¶ 40-53.) These judgments are no less
binding than any other contract and are also imbued with the
additional authority of the court. Thus, Plaintiff possesses legal
rights akin to a plaintiff asserting a tortious interference claim
with contract, as opposed to a plaintiff asserting a tortious
interference claim with prospective contractual relations, and
Plaintiff need not allege independently tortious or criminal
conduct to state a claim for tortious interference with enforcement
of a judgment.

As discussed more thoroughly above, Plaintiff has adequately
alleged that Defendants’ conduct – even if lawful – tortiously
interfered with Plaintiff’s collection of his judgments.
Plaintiff alleges that, Defendants, with full knowledge of
Plaintiff’s attempts to collect from the Judgment Debtors, entered
into an agreement with Kasowitz to pay Fischman’s legal fees,
thereby helping Fischman conceal his assets from collection. (Am.
Compl. ¶¶ 30, 46, 49.) Defendant Sy Marcus admitted to knowing
about the outstanding judgments during his in-person meeting with
Plaintiff. (Id. ¶ 36.) In exchange, Defendants and their
entities received Fischman’s Ultimax stock, upon which Plaintiff
would have otherwise been able to levy and execute. (Id. ¶¶ 30,

45.) Defendant Ellen Marcus, Sy Marcus’ wife, made the payments
to Kasowitz herself from their “house account.” (Id. ¶ 35.) Thus,
Plaintiff has stated a claim with respect to Count One.
2. “But For” Causation of Plaintiff’s Injuries
Defendants argue that Plaintiff fails to allege that
Defendants’ actions were the “but for” cause of Plaintiff’s
injuries (i.e., his inability to levy and collect on his
judgments). The Court disagrees.
Fischman’s Ultimax shares are personal property subject to
execution in satisfaction of Plaintiff’s judgment. See C.P.L.R.
§ 5232(a); Gallant v. Kanterman, 249 A.D.2d 59, 62 (1st Dep’t.
1998) (finding stock certificates “available pursuant to CPLR
5232(b) to be levied upon by seizure and sold[.]”); (Am. Compl.

¶ 22.) Despite issuing subpoenas and writs, Plaintiff was unable
to locate, restrain and levy on Fischman’s Ultimax shares. (Id.)
Plaintiff further alleges that, were it not for Defendant Sy
Marcus’ agreement with Kasowitz, Fischman would have had to
liquidate his Ultimax stock for cash and deposit the funds into
bank accounts subject to restraining notices. (Id. ¶¶ 25, 36.)
Instead, Defendants paid Kasowitz for services to Fischman, who
avoided depositing funds into his restrained accounts. In other
words, without Defendants’ assistance, Fischman’s Ultimax shares
would have been converted to cash and deposited into a bank account
subject to Plaintiff’s restraining notices even if Plaintiff could
not execute on the shares directly. (Id. ¶ 25.) These allegations

are sufficient to show but-for causation at the motion to dismiss
stage.
D. Count Two – Aiding and Abetting Fraudulent Conveyance
and Conspiracy to Defraud
Defendants argue that Count Two in the Amended Complaint
should be dismissed. (Mot. at 17-18.) Though pleaded as a single
count, the Court will separately discuss Plaintiff’s aiding and
abetting fraudulent conveyance claim and Plaintiff’s conspiracy to
defraud claim.
1. Aiding and Abetting Fraudulent Conveyance
Defendants argue that Plaintiff has failed to allege an
underlying fraudulent conveyance for which aiding and abetting
liability would attach. (Mot. at 17-18.) On reply, Defendants
raise for the first time that (1) Plaintiff’s claim for aiding and
abetting fraudulent conveyance is “not cognizable upon New York
law,” and (2) Plaintiff has not met the heightened pleading
requirements for fraud under Federal Rule of Civil Procedure 9(b).
(Reply at 9-12.) The Court agrees that, as pled, Plaintiff’s

aiding and abetting claim must be dismissed.
As a preliminary matter, the Court notes that it has “wide
discretion” on whether to consider arguments made for the first
time on reply. See, e.g., Watson v. Geithner, 355 F. App’x 482,
483 (2d Cir. 2009) (summary order) (court may decline to consider
an argument raised for the first time in a reply brief); Compania
Del Bajo Caroni (Caromin), C.A. v. Bolivarian Republic of
Venezuela, 341 F. App’x 722, 724 (2d Cir. 2009) (citations omitted)

(finding “[a] district court enjoys broad discretion . . . to
consider arguments made for the first time in a reply brief[.]”).
As Plaintiff has neither objected nor sought to file a sur-reply,
and in the interests of thoroughness, the Court will address all
of Defendants’ arguments in turn.
Under a generous reading of the Amended Complaint, Plaintiff
appears to allege two fraudulent conveyances where aiding and
abetting liability may arise. First, Plaintiff appears to allege
certain fraudulent conveyances where Fischman’s wife, Nina

Fischman, was the transferee of Fischman’s executive compensation
and Cardis’ receipts. (Am. Compl. ¶¶ 14, 15; Opp. at 20.) Second,
Plaintiff also alleges that, as a result of Defendants’ scheme
with Fischman, Sy Marcus received Ultimax stock and/or a portion
of Fischman’s ownership interest in Ultimax. (Id. ¶¶ 56, 59.) In
other words, Sy Marcus was the transferee or beneficiary of the
allegedly fraudulent conveyances from Fischman to Defendants.
(See id. ¶¶ 44, 45.)
a. Conveyances from Aaron Fischman to Nina
Fischman
The Court first addresses Defendants’ argument that
Plaintiff’s claim of aiding and abetting fraudulent conveyance is
not cognizable under New York law where Defendants are neither the
transferees nor beneficiaries of the conveyance. (Reply at 11.)
The Court agrees that an aiding and abetting claim may not be
sustained “against parties who merely participated in the transfer
but did not benefit from it.” Amusement Indus., Inc. v. Midland
Ave. Assocs., LLC, 820 F. Supp. 2d 510, 527 (S.D.N.Y. 2011). New

York courts have consistently found that there is “no cause of
action for aiding and abetting a fraudulent conveyance against a
person . . . who is alleged merely to have assisted in effecting
the transfer . . . and who is not alleged to have been a transferee
. . . or to have benefitted from the transaction.” BBCN Bank v.
12th Avenue Restaurant Grp. Inc., 150 A.D.3d 623 (1st Dep’t. 2017)
(collecting cases). “[U]nder the existing fraudulent conveyance
statutes, the only possible claim for relief in such a circumstance
would be a claim against ‘transferees of the assets []or
beneficiaries of the conveyance.” Amusement Indus., Inc., 820 F.
Supp. 2d at 533 (citing Fed. Deposit Ins. Co. v. Porco, 552 N.E.2d
158 (N.Y. 1990)). Thus, Plaintiff’s aiding and abetting claim for

transfers made to Nina Fischman, where Defendants were neither the
transferee nor beneficiary, fails as a matter of law and is
dismissed.6
b. Conveyances from Aaron Fischman to Sy Marcus
As for Plaintiff’s aiding and abetting claim for Fischman’s
transfers of his interests in Ultimax stock to Sy Marcus, the main

issue here – as Defendants appear to concede – is that Plaintiff
has incorrectly alleged aiding and abetting liability when he
should have simply brought a direct claim of fraudulent conveyance.
(See Reply at 10 (noting that “the appropriate relief – if any –
would be to void the conveyance of the Ultimax stock”); Reply at
13 (Defendants “believe that any claim to recover the stock would
have to be brought directly against Sy in a fraudulent conveyance
action . . .”).)
Plaintiff alleged that Defendant Sy Marcus was the transferee
of Fischman’s Ultimax common stock. (Am. Compl. ¶ 55.) Though
“[t]ransferors cannot be sued for a fraudulent conveyance claim,
and thus someone who has aided and abetted the transferor could

not logically be sued either if they had no other role in the
transaction[,]” transferees clearly may be sued for fraudulent
conveyance. Amusement Indus. Inc., 820 F. Supp. 2d at 532-33.
“[I]n such an instance, there is no need to resort to a claim of
‘aiding and abetting.’ Instead, such a defendant may be sued

6 Plaintiff has also not alleged that Defendants assisted or even “merely
participated” in the transfer of Fischman’s assets to Nina Fischman.
The Amended Complaint suggests instead that those transfers were
facilitated by Lawrence Katz, an attorney for Cardis. (Am. Compl. ¶ 14.)
directly for the fraudulent conveyance[.]” Id. at 533.7
Plaintiff, however, has not brought a direct fraudulent conveyance
claim against Defendant Sy Marcus, and his claim as pleaded must

be dismissed.
2. Conspiracy to Defraud
As to the second claim in Count Two, Defendants argue that
Plaintiff “failed to allege with specificity a tortious act based
on a common agreement and overt action taken in furtherance of
such alleged conspiracy.” (Mot. at 17-18.) On reply, Defendants
argue that Plaintiff’s claim for aiding and abetting conspiracy to
defraud is also “not an independent cause of action under New York
law.” (Reply at 12.) Plaintiff does not respond or otherwise
address these arguments in his opposition brief.
As Defendants correctly assert, there is no independent cause
of action for civil conspiracy to defraud under New York law. See
Filler v. Hanvit Bank, 156 F. Appx. 413, 417 (2d Cir. 2005).

However, a civil conspiracy may be alleged for the purpose of

7 Defendants also appear to argue that Plaintiff may not seek monetary
damages through a fraudulent conveyance claim. (Reply at 10.) The Court
disagrees. “Generally, the creditor’s remedy in a fraudulent conveyance
action is limited to reaching the property which would have been
available to satisfy the judgment had there been no conveyance.” Cap.
Distributions Servs., Ltd., v. Ducor Exp. Airlines, Inc., 440 F. Supp.
2d 195, 204 (E.D.N.Y. 2006). “However, where the assets fraudulently
transferred no longer exist or are no longer in the possession of the
transferee, a money judgment may be entered against the transferee in
an amount up to the value of the fraudulently transferred assets.” Id.;
accord Mfrs. & Traders Trust Co. v. Lauer’s Furniture Acquisition, Inc.,
226 A.D.2d 1056, 1057 (4th Dep’t. 1996) (“money judgment was properly
granted” where asserts were “sold and commingled”).
showing that an otherwise actionable tort was committed jointly by
the conspirators and that, because of the conspirators’ common
purpose and interests, the acts of one may be imputed to the
others. Id.; Grove Press, Inc. v. Angleton, 649 F.2d 121, 123 (2d

Cir. 1981) (“The allegation [of conspiracy] ‘is merely the string
whereby the plaintiff seeks to tie together those who, acting in
concert, may be held responsible in damages for any overt act or
acts.’”) (quoting Rutkin v. Reinfeld, 229 F.2d 248, 252 (2d Cir.
1956)).
Thus, to establish a sufficient claim for conspiracy to
defraud, a plaintiff must first allege facts demonstrating the
underlying fraud, although the plaintiff need not prove that each
defendant committed every element of the underlying fraud. Meisel
v. Grunberg, 651 F. Supp. 2d 98, 119 (S.D.N.Y. 2009) (citing Snyder
v. Puente De Brooklyn Realty Corp., 297 A.D.2d 432, 435 (N.Y.

2002)). In addition, a plaintiff must allege plausible facts of
(1) a corrupt agreement; (2) an overt act in furtherance of that
agreement; and (3) membership in the conspiracy by each defendant.
Cofacredit, S.A. v. Windsor Plumbing Supply Co., 187 F.3d 229, 240
(2d Cir. 1999). “As is true in criminal conspiracies, agreements
in civil conspiracies will not easily be shown by direct evidence,
but may be inferred from circumstantial evidence.” Id.
Plaintiff has sufficiently and plausibly alleged a conspiracy
to defraud. As a preliminary matter, the Court notes that
Plaintiff only asserts this claim against defendant Sy Marcus.
The underlying fraud that Plaintiff alleges is that Sy Marcus
knowingly schemed with Fischman to conceal and transfer Fischman’s

assets, thereby placing them out of Plaintiff’s reach. In
furtherance of that scheme, Plaintiff alleged that Sy Marcus and
Fischman, with knowledge of Plaintiff’s underlying judgments,
entered into an agreement with Kasowitz, where Sy Marcus agreed to
pay Fischman’s legal fees. (Am. Compl. ¶¶ 9, 30.) As
consideration for undertaking those payments, Plaintiff alleges
that Sy Marcus received Fischman’s valuable Ultimax common stock.
(Id. ¶ 30.) Defendants then made several wire transfers directly
to Kasowitz, in furtherance of their agreement with Fischman,
thereby permitting Fischman to continue to enjoy Kasowitz’s legal
services without placing assets within Plaintiff’s reach. (Id. ¶
35.) Additionally, Defendants proceeded to wire money for

Fischman’s benefit through other channels, including to IOLA
accounts for Fischman’s other attorneys. (Id. ¶ 37.) Plaintiff’s
allegations against Sy Marcus are sufficient and plausibly alleged
at this stage in the litigation. Thus, Defendants’ motion to
dismiss Plaintiff’s conspiracy to defraud claim is denied.
3. Leave to Replead
In light of the Federal Rules of Civil Procedure’s general
deemphasis on the form of the pleadings in favor of trying a case
on its merits, Plaintiff is granted leave to amend his complaint
to assert a direct fraudulent conveyance claim.
Pursuant to Federal Rule of Civil Procedure 15(a), “leave (to
replead) shall be freely given when justice so requires[.]” Here,

Plaintiff has not requested leave to amend any of his claims. “[A]
district court has no duty to instruct plaintiffs that they may
move to amend their complaint and, at least in counseled cases,
cannot abuse its discretion by failing to sua sponte grant leave
to amend.” Oparaji v. City of N.Y., 152 F.3d 920 (2d Cir. 1998)
(summary order) (citing In re Am. Express Co. S’holder Litig., 39
F. 3d 395, 401 (2d Cir. 1994)).
Nevertheless, the Court may sua sponte grant leave to replead.
See Straker v. Metropolitan Travel Auth., 333 F. Supp. 2d 91, 102
(E.D.N.Y. 2004). The Court’s discretion is “broad[,]” and “its
exercise depends upon many factors, including undue delay, bad
faith or dilatory motive on the part of the movant, repeated

failure to cure deficiencies by amendments previously allowed,
undue prejudice to the opposing party by virtue of allowance of
the amendment, futility of amendment, etc.” Local 802, Assoc.
Musicians of Greater N.Y. v. Parker Meridien Hotel, 145 F.3d 85,
89 (2d Cir. 1998).
As discussed above, Plaintiff has alleged facts that may
sustain a fraudulent conveyance claim against Sy Marcus and the
entities which received Fischman’s Ultimax shares. Defendants
have ample notice of this claim. First, Plaintiff’s Amended
Complaint cites the statutory provision for a direct fraudulent
conveyance claim, New York Debtor & Creditor Law § 273(a)(1),
despite fashioning the claim as aiding and abetting a fraudulent

conveyance. (Am. Compl. ¶¶ 58, 59.) Second, Defendants have moved
to dismiss this claim on their own initiative in their motion to
dismiss briefing. (See Reply at 10, 13.) Considering all the
circumstances, the Court, in the exercise of its discretion, grants
Plaintiff leave to amend his fraudulent conveyance claims.
IV. Defendants’ Motion for Judgment on the Pleadings
As the Court has fully addressed Defendants’ motion to dismiss
under Rule 12(b)(6), the Court need not reach Defendants’ motion
in the alternative for judgment on the pleadings. See Irish
Lesbian & Gay Org. v. Giuliani, 143 F.3d 638, 644 (2d Cir. 1998)
(stating that “[t]he test for evaluating a 12(c) motion is the
same as that applicable to a motion to dismiss under [Rule
12(b)(6)].”).

CONCLUSION
For the foregoing reasons, Defendants’ motion to dismiss
pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(2)
is DENIED. Defendants’ motion to dismiss pursuant to Federal Rule
of Civil Procedure 12(b)(6) is DENIED as to Count One, and GRANTED
in part as to Count Two. To the extent Plaintiff asserts claims
of aiding and abetting fraudulent conveyance, those claims are
hereby DISMISSED. If Plaintiff intends to amend his complaint to
replead his fraudulent conveyance claims, he is directed to do so
within thirty (30) days of this Memorandum and Order.
In light of this Memorandum & Order, the parties are also
referred to Magistrate Judge Lindsey for supervision of discovery
and pre-trial issues as appropriate.

So ordered. b “4 ~, __
oe □□ ou wwe
Dated: March 4, 2025 ig
Brooklyn, New York Kiyo A. Matsumoto
United States District Judge
Eastern District of New York

41

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10816662. Public record. Not legal advice.