Gehl Foods, LLC v. Worldwide Sport Nutritional Supplements, Inc.

Gehl Foods, LLC v Worldwide Sport Nutritional

Supplements, Inc.

2025 NY Slip Op 31602(U)

May 2, 2025

Supreme Court, New York County

Docket Number: Index No. 653626/2024

Judge: Anar Rathod Patel

Cases posted with a "30000" identifier, i.e., 2013 NY Slip

Op 30001(U), are republished from various New York

State and local government sources, including the New

York State Unified Court System's eCourts Service.

This opinion is uncorrected and not selected for official

publication.

FILED: NEW YORK COUNTY CLERK 05/02/2025 01:00 PM INDEX NO. 653626/2024

NYSCEF DOC. NO. 93 RECEIVED NYSCEF: 05/02/2025

SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 45

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GEHL FOODS, LLC INDEX NO. 653626/2024

Plaintiff, MOTION

DATE 02/24/2025

-v-

WORLDWIDE SPORT NUTRITIONAL MOTION SEQ.

SUPPLEMENTS, INC., NO. 005

Defendant. DECISION + ORDER ON

MOTION

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HON. ANAR RATHOD PATEL:

The following e-filed documents, listed by NYSCEF document number (Motion 005) 2,

67, 70–77, 82, 91–92 were read on this motion to/for ATTORNEYS’ FEES.

By Decision and Order dated December 16, 2024, the Court granted Defendant Worldwide

Sport Nutritional Supplements, Inc.’s (“1440” or “Defendant”) Motion to Dismiss the Complaint

without prejudice pursuant to CPLR §§ 3211(a)(1) and (a)(7). See NYSCEF Doc. No. 67

(12/16/24 Decision and Order). The Court determined that Plaintiff Gehl Foods, LLC (“Plaintiff”)

failed to allege a breach of the Pilot Agreement and Amendment, which was intended as an

agreement for a pilot run for the products at issue and required that any amendment or modification

must be made in writing. The Court carefully considered the contentions of the parties and

rendered a decision on the merits. See id. at 29–38. Plaintiff has not appealed the Court’s decision

and i time to file a notice of appeal has passed.

On February 24, 2025, Defendant moved for an award of attorneys’ fees and necessary

expenses in the amount of $149,261.27 pursuant to Section 10 of the Pilot Agreement, which

provides that the “prevailing Party shall be entitled to recover from the other all necessary expenses

and reasonable attorneys’ fees incurred, in addition to any other relief to which it is entitled.” See

NYSCEF Doc. No. 2 (Pilot Agreement). In support of its application, Defendant advances three

arguments: (1) because the Court determined the Pilot Agreement was inapplicable to future

purchases on the merits, Plaintiff is precluded from reasserting claims based on the Pilot

Agreement, rendering Defendant the prevailing party; (2) Defendant’s request for fees is timely;

and (3) Plaintiff’s failure to contest the reasonableness of the fees in opposition waives any

subsequent challenge and accordingly, fees should be awarded to Defendant. NYSCEF Doc. No.

77 at 6–13.

On March 28, 2025, Plaintiff opposed the Motion, arguing: (1) Defendant is not a

prevailing party because the dismissal was without prejudice and related claims are pending in

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another forum1; (2) Defendant’s motion is untimely because it was filed after entry of judgment;

and (3) the Court should not consider the reasonableness of fees unless and until an entitlement

determination is made following a hearing. See NYSCEF Doc. No. 82 at 8–13.

On April 4, 2025, Defendant filed a reply, maintaining that: (1) the Court’s determination

regarding the Pilot Agreement’s inapplicability was made on the merits and precludes Gehl from

pursuing claims under the Agreement; (2) the application is timely because it seeks fees following

a dispositive ruling, not by way of amendment of a judgment; and (3) Gehl waived any objection

to the reasonableness of the requested fees by failing to raise the issue in its Opposition. See

NYSCEF Doc. No. 92 at 6–13.

Attorneys’ fees are merely an incident of litigation and thus are not recoverable absent a

specific contractual provision or statutory authority. Hooper Associates, Ltd. v. AGS Computers,

Inc., 74 N.Y.2d 487, 491 (1989). The reasonableness of legal fees “can be determined only after

consideration of the difficulty of the issues and the skill required to resolve them; the lawyers’

experience, ability and reputation; the time and labor required; the amount involved and benefit

resulting to the client from the services; the customary fee charges for similar services; the

contingency or certainty of compensation; the results obtained and the responsibility involved.”

Morgan & Finnegan v. Howe Chem. Co., Inc., 210 A.D.2d 62, 63 (1st Dept. 1994) (internal

citations omitted). An award of reasonable attorneys’ fees is within the sound discretion of the

court. JK Two LLC v. Garber, 171 A.D.3d 496–497, 98 N.Y.S.3d 37 (1st Dept. 2019). Here,

Defendant claims entitlement to contractual attorney’ fees based on Section 10 of the Pilot

Agreement.

I. Prevailing Party Status

To determine whether a party has “prevailed” for the purpose of awarding attorneys’ fees,

the court must consider the “true scope” of the dispute litigated and what was achieved within that

scope. See Excelsior 57th Corp. v. Winters, 227 A.D.2d 146 (1996). To be considered a

“prevailing party,” one must simply prevail on the central claims advanced, and receive substantial

relief in consequence thereof. See Board of Mgrs. of 55 Walker St. Condominium v. Walker St., 6

A.D.3d 279 (2004). Plaintiff’s reliance on inapposite landlord-tenant and summary proceeding

cases, including J.P. & Assocs. Props. Corp. v. Krautter, 38 Misc. 3d 60 (App. Term 2d Dept

2013), is misplaced. In those cases, dismissals left unresolved central claims and expressly

contemplated future litigation. For example, in Krautter, the petition was dismissed without

prejudice while a related DHCR proceeding remained pending. The court held that a prevailing

party determination was premature because the “ultimate outcome” of the controversy had not

been reached. See also Elkins v. Cinera Realty, Inc., 61 A.D.2d 828 (2d Dept 1978).

1

Plaintiff states “the parties are presently and actively litigating this contract dispute in the Eastern District of New

York.” See NYSCEF Doc. No. 82 (Pl. Opp’n). Upon close review of the Complaint filed in that action, there is no

mention of the Pilot Agreement in the Complaint; rather, 1440 alleges breach of Purchase Orders, which contain a

mandatory forum selection clause requiring that claims arising under the Purchase Orders are litigated in federal or

state courts in Suffolk County, New York. See NYSCEF Doc. No. 89 (Complaint, Index No. 631708/2024); see also

NYSCEF Doc. No. 77 (Def. Mem.) at 4.

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The Court finds that Defendant have established that it is the prevailing party because the

Court adjudicated the central relief sought by Defendant on the merits and has disposed of

Plaintiff’s singular claim for breach of the Pilot Agreement. Contrary to Plaintiff’s arguments, the

Court’s dismissal of the action was not based on a procedural defect or technicality, but rather on

a dispositive legal ruling that resolved the central relief sought. The Court held that the Pilot

Agreement could not be orally modified under General Obligations Law § 15-301 and the purchase

orders at issue constituted fully integrated agreements, thereby barring extrinsic evidence under

U.C.C. § 2-202. The Court further held that Plaintiff failed to identify any specific contractual

obligation that was breached. See NYSCEF Doc. No. 67. Plaintiff has not appealed, sought leave

to replead, and/or filed or continued any action alleging breach of the Pilot Agreement.

Accordingly, there is nothing left to adjudicate, and no other proceeding exists or is anticipated

that could alter the outcome of this litigation.

II. Timeliness of Application

The Court also finds that Defendant’s motion is timely. Plaintiff argues that the fee request

is barred because it was not raised prior to entry of judgment, but that argument conflates this

motion with cases involving belated efforts to amend judgments under CPLR § 5019(a). Here,

Defendant filed its fee request by separate motion following dismissal of the action, but prior to

any final determination on the issue of fees. Indeed, this procedural posture is consistent with the

holding in LMM Capital Partners, LLC v. Mill Point Capital, LLC, 2024 WL 1284109 (Sup. Ct.

N.Y. Cnty. Mar. 26, 2024). There, the court granted dismissal on the merits and then, several

months later, awarded attorneys’ fees under a contractual fee-shifting provision. The court rejected

the argument that the fee motion was untimely or procedurally defective because it was not joined

with the dispositive motion. That reasoning applies here. Defendant obtained a merits-based

dismissal and timely sought fees by motion.

Cases relied upon by Plaintiff including Rotunno v. Gruhill Constr. Corp., 29 A.D.3d 772

(2d Dept. 2006) and Golden v. Multigas Distribs., Ltd., 256 A.D.2d 215 (1st Dept. 1998) are

readily distinguishable. Those cases involved efforts to retroactively amend judgments to insert

fee awards that had not been requested at the appropriate time. Defendant here made no such

request.

III. Reasonableness of Fees

In support of its application, Defendant submitted the affirmation of Arthur Joseph (“A.J.”)

Monaco, Esq., of O’Brien LLP, detailing the legal services performed. See NYSCEF Doc. No. 71

(Monaco Aff.). The Monaco Affirmation describes the work performed by his firm; outlines the

qualifications and billing rates of himself, Mr. O’Brien, Esq., Mr. Eaton, and Ms. Mascolo; and

references supporting documentation, including the underlying attorney invoices and expense

summaries for September 2024 through December 2024. Defendant further submitted an expense

summary, organized by billing professional and month, detailing the work performed in this matter

(NYSCEF Doc. No. 72 (Ex. A, Expense Summary)) and partially redacted invoices itemizing the

services rendered and billed hours (NYSCEF Doc. No. 73 (Ex. B, Invoices)).

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Mr. Monaco affirms that O’Brien LLP acted as co-counsel in this matter alongside the law

firm of Amin Wasserman Guarnani LLP (“AWG”). See Monaco Aff. ¶ 2; see also NYSCEF Doc.

No. 74 (Spatz Aff.). The Spatz Affirmation likewise contains counsel’s qualification, rates, and

work performed in connection with this matter. AWG submitted its billing records, including an

expense summary and itemized invoices. See NYSCEF Doc. Nos. 75–76.”

These materials are sufficient for the Court to determine the amount of attorneys’ fees to

be awarded. JK Two LLC v. Garber, 171 A.D.3d 496 (1st Dept 2019). Nevertheless, Plaintiff

requests that the Court first determine whether Defendant is entitled to fees, and then direct

Plaintiff to provide a detailed and itemized response in conjunction with a hearing. Plaintiff does

not meaningfully dispute the reasonableness of the requested fees in its opposition papers. The

Court finds Plaintiff’s requested approach to be at odds with the purpose of opposition papers and

judicial economy. Nevertheless, the Court directs a hearing on the reasonableness of attorneys

such that Plaintiff may challenge the amount of fees requested. Kaufman v. Kaufman, 189 A.D.3d

31, 73 (1st Dept. 2020). The parties are encouraged to meet and confer and to stipulate to any

amount of the award. If any such agreement is reached, the parties shall promptly notify the Court

and the Referee Clerk.

Accordingly, it is

ORDERED that Defendant’s Motion for Reasonable Attorneys’ Fees and Expenses is

GRANTED on the issue of liability, and the issue of damages is referred to a Judicial Hearing

Officer (JHO) or Special Referee to hear and report, and it is further

ORDERED that a JHO or Special Referee shall be designated to hear and report to this

Court on the following individual issue of fact, which are hereby submitted to the JHO/Special

Referee for such purpose: the amount of contractual attorneys’ fees and expenses incurred by

Defendant in this action; and it is further

ORDERED that this matter is hereby referred to the Special Referee Clerk (Room 119,

646-386-3028 or spref@nycourts.gov) for placement at the earliest possible date upon the calendar

of the Special Referees Part (Part SRP), which, in accordance with the Rules of that Part (which

are posted on the website of this Court at www.nycourts.gov/supctmanh at the “References” link),

shall assign this matter at the initial appearance to an available JHO/Special Referee to hear and

report as specified above; and it is further

ORDERED that counsel for the Defendant shall, within 15 days from the date of this

Order, submit to the Special Referee Clerk by fax (212-401-9186) or e-mail an Information Sheet

(accessible at the “References” link on the court's website) containing all the information called

for therein and that, as soon as practical thereafter, the Special Referee Clerk shall advise counsel

for the parties of the date fixed for the appearance of the matter upon the calendar of the Special

Referees Part; and it is further

ORDERED that Defendant shall serve a proposed accounting within 24 days from the date

of this Order and Plaintiff shall serve objections to the proposed accounting within 20 days from

service of the Defendant’s papers and the foregoing papers shall be filed with the Special Referee

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Clerk prior to the original appearance date in Part SRP fixed by the Clerk as set forth above; and

it is further

ORDERED that the parties shall appear for the reference hearing, including with all

witnesses and evidence they seek to present, and shall be ready to proceed with the hearing, on the

date fixed by the Special Referee Clerk for the initial appearance in the Special Referees Part,

subject only to any adjournment that may be authorized by the Special Referees Part in accordance

with the Rules of that Part; and it is further

ORDERED that the hearing will be conducted in the same manner as a trial before a Justice

without a jury (CPLR § 4320[a]) (the proceeding will be recorded by a court reporter, the rules of

evidence apply, etc.) and, except as otherwise directed by the assigned JHO/Special Referee for

good cause shown, the trial of the issues specified above shall proceed from day to day until

completion, and it is further

ORDERED that counsel shall file memoranda or other documents directed to the assigned

JHO/Special Referee in accordance with the Uniform Rules of the Judicial Hearing Officers and

the Special Referees (available at the “References” link on the court's website) by filing same with

the New York State Courts Electronic Filing System (see Rule 2 of the Uniform Rules); and it is

further

ORDERED that any motion to confirm or disaffirm the Report of the JHO/Special Referee

shall be made within the time and in the manner specified in CPLR § 4403 and Section 202.44 of

the Uniform Rules for the Trial Courts (unless a CPLR § 4317 stipulation had been entered into).

The foregoing constitutes the Decision and Order of the Court.

May 2, 2025 $SIG$

DATE HON. ANAR RATHOD PATEL, A.J.S.C.

CHECK ONE: X CASE DISPOSED NON-FINAL DISPOSITION

□

X GRANTED DENIED GRANTED IN PART OTHER

APPLICATION: SETTLE ORDER SUBMIT ORDER

□

CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE

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