The opinion
People v VDARE Found., Inc.
2026 NY Slip Op 31040(U)
March 17, 2026
Supreme Court, New York County
Docket Number: Index No. 452397/2025
Judge: Sabrina Kraus
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file:///LRB-ALB-FS1/Vol1/ecourts/Process/covers/NYSUP.4523972025.NEW_YORK.002.LBLX038_TO.html[03/25/2026 3:45:49 PM]
FILED: NEW YORK COUNTY CLERK 03/17/2026 03:27 PM INDEX NO. 452397/2025
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 03/17/2026
SUPREME COURT OF THE STATE OF NEW YORK
NEW YORK COUNTY
PRESENT: HON. SABRINA KRAUS PART 57M
Justice
---------------------------------------------------------------------------------X INDEX NO. 452397/2025
PEOPLE OF THE STATE OF NEW YORK, by LETITIA
JAMES, ATTORNEY GENERAL OF THE STATE OF NEW MOTION DATE 12/18/2025
YORK,
MOTION SEQ. NO. 002
Plaintiff,
-v-
DECISION + ORDER ON
VDARE FOUNDATION, INC., PETER BRIMELOW, and
LYDIA BRIMELOW MOTION
Defendants.
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The following e-filed documents, listed by NYSCEF document number (Motion 002) 1, 17, 19, 20, 22, 23,
25, 28
were read on this motion to/for DISMISSAL .
BACKGROUND
The Office of the Attorney General (“OAG”) commenced this action against VDARE
Foundation, Inc. (“VDARE”), Peter Brimelow and Lydia Brimelow seeking, inter alia, a
permanent injunction, restitution, and judicial dissolution of VDARE for the defendants’ alleged
violations of: the Not-for-Profit Corporations Law (“N-PCL”); Estates, Powers and Trusts Law
(“EPTL”); and Executive Law.
ALLEGED FACTS AND RELEVANT PROCEDURAL HISTORY
The factual allegations of this case are referenced in the Court’s March 5, 2026, decision
and order and will not be repeated here (see NYSCEF Doc No. 25 [denying VDARE’s motion to
dismiss pursuant to CPLR § 3211(a)(7)]).
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PENDING MOTION
On February 27, 2026, Peter and Lydia Brimelow (collectively, “Defendants”) moved to
dismiss the first, second, third, fourth, seventh, eighth and ninth causes of action as against them
pursuant to CPLR § 3211(a)(7) (NYSCEF Doc No. 19 [mot. seq. 002]).
The motion was marked submitted on March 16, 2026, and the Court reserved decision.
The Court denies the motion in its entirety for the reasons set forth below.
DISCUSSION
A court will dismiss a claim when the movant demonstrates that “the pleading fails to
state a cause of action” (CPLR § 3211(a)(7)). Courts “give the complaint a liberal construction,
accept the allegations as true and provide [the nonmovant] with the benefit of every favorable
inference” (Nomura Home Equity Loan, Inc., Series 2006-FM2 v Nomura Credit & Capital, Inc.,
30 NY3d 572, 582 [2017]). Courts do not weigh “[w]hether a plaintiff can ultimately establish its
allegations” as part of the calculus in determining a motion to dismiss (EBC I, Inc. v Goldman,
Sachs & Co., 5 NY3d 11, 19 [2005]). A court “merely examines the adequacy of the pleadings,”
unlike a motion for summary judgment in which the court “searches the record and assesses the
sufficiency of the parties’ evidence” (Davis v Boeheim, 24 NY3d 262, 268 [2014]).
The Court Denies the Motion to Dismiss the First and Second Causes of Action
Defendants make no argument in support of the dismissal of the first and second causes
of action as against them for breach of fiduciary duty and breach of EPTL § 8-1.4 as Defendants
only adopt the arguments made by VDARE in support of its own motion to dismiss which do not
include dismissal of these causes of action (see NYSCEF Doc No. 20; see also NYSCEF Doc
No. 17, at 1 [VDARE memorandum in support]).
Regarding the first cause of action for breach of fiduciary duty, N-PCL § 717 provides:
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(a) Directors, officers and key persons shall discharge the duties of their respective
positions in good faith and with the care an ordinarily prudent person in a like
position would exercise under similar circumstances . . . .
N-PCL § 720 provides:
(a) An action may be brought against one or more directors, officers, or key persons
of a corporation to procure a judgment for the following relief:
(1) To compel the defendant to account for his official conduct in the following
cases:
(A) The neglect of, or failure to perform, or other violation of his duties in the
management and disposition of corporate assets committed to his charge.
(B) The acquisition by himself, transfer to others, loss or waste of corporate
assets due to any neglect of, or failure to perform, or other violation of his
duties.
N-PCL § 720(b) authorizes the Attorney General to bring an action pursuant to subsection (a).
The Complaint adequately pleads violations of N-PCL §§ 717 and 720 as the Brimelows
allegedly used VDARE’s funds for their own personal benefit by transferring VDARE’s funds to
BBB, Lydia Brimelow’s for-profit corporation, and by purchasing the Castle with VDARE’s
funds for use as their own personal residency (e.g. NYSCEF Doc No. 1 ¶¶ 105–07, 109). The
Complaint also alleges that several transactions constituted a waste of VDARE’s corporate assets
as Lydia Brimelow may have overbid on the Castle (see id. ¶¶ 70–79) and she may also have
overpaid for business advice provided to VDARE from her father (see id. ¶¶ 84–86). The Court
thus denies the motion to dismiss the first cause of action as the Court must afford the allegations
in the Complaint with “the benefit of every favorable inference” (Nomura Home Equity Loan,
Inc., Series 2006-FM2 v Nomura Credit & Capital, Inc., 30 NY3d 572, 582 [2017]).
Regarding the second cause of action, EPTL § 8-1.4 provides, in relevant part:
(a) For the purposes of this section, “trustee” means (1) any individual, group of
individuals, executor, trustee, corporation or other legal entity holding and
administering property for charitable purposes, whether pursuant to any will, trust,
other instrument or agreement, court appointment, or otherwise pursuant to law,
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over which the attorney general has enforcement or supervisory powers, (2) any
non-profit corporation organized under the laws of this state for charitable
purposes[.]
***
(d) Every trustee shall file with the attorney general, within six months after any
property held by him or her or any income therefrom is required to be applied to
charitable purposes, a copy of the instrument providing for his or her title, powers
and duties; provided, however, that any trustee currently registered with the
department of law pursuant to article 7-A of the executive law shall be deemed to
have complied with this paragraph. If any property held by a trustee or any income
therefrom is required to be applied to charitable purposes at the time this section
becomes effective, the filing shall be made within six months thereafter.
The Attorney General may bring an action under EPTL § 8-1.4(m) to ensure the “proper
administration of any trust, corporation or other relationship to which this section
applies” (id. § 8-1.4(m)). The purpose of this provision is “to prevent the misapplication
of property held for an exempt purpose” (In re North Manursing Wildlife Sanctuary, Inc.,
48 NY2d 135, 142 [1979]).
The Complaint adequately alleges that Peter and Lydia Brimelow, as directors of
VDARE, failed to file the appropriate reports with the Attorney General documenting VDARE’s
transactions with which they may have personally had a financial interest (see e.g. NYSCEF Doc
No. 1 ¶¶ 155–58). The Complaint also alleges that Peter and Lydia Brimelow misappropriated
VDARE’s property that was intended to be administered for charitable purposes by using the
Castle as a personal residence, among other misuses.
The Court accords no weight to the Defendants’ novel argument, raised for the first time
in reply, that the second cause of action is duplicative of the first as consideration of an argument
in support of dismissal pursuant to CPLR § 3211 raised for the first time in reply is improper and
grounds for granting a subsequent motion for renewal (see Dookhie v Woo, 180 AD3d 459, 464–
65 [1st Dept 2020] [“It should be noted that [Defendants’] argument was raised for the first time
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in reply, and for that reason should not have been considered, let alone credited”]; see also
Mehra v Morrison Cohen LLP, 203 AD3d 438, 438–39 [1st Dept 2022]).
The Court thus denies Defendants’ motion to dismiss the second cause of action.
The Court Denies the Motion to Dismiss the Third Cause of Action
Neither VDARE nor the Defendants made an argument for dismissal of the third cause of
action as against the Defendants for wrongful related party transactions in their moving papers.
N-PCL § 102(a)(23) defines a “related party” as:
(i) any director, officer or key person of the corporation or any affiliate of the
corporation; (ii) any relative of any individual described in clause (i) of this
subparagraph; or (iii) any entity in which any individual described in clauses (i) and
(ii) of this subparagraph has a thirty-five percent or greater ownership or beneficial
interest or, in the case of a partnership or professional corporation, a direct or
indirect ownership interest in excess of five percent.
N-PCL § 102(a)(24) defines a “related party transaction” as:
any transaction, agreement or any other arrangement in which a related party has a
financial interest and in which the corporation or any affiliate of the corporation is
a participant, except that a transaction shall not be a related party transaction if: (i)
the transaction or the related party’s financial interest in the transaction is de
minimis, (ii) the transaction would not customarily be reviewed by the board or
boards of similar organizations in the ordinary course of business and is available
to others on the same or similar terms, or (iii) the transaction constitutes a benefit
provided to a related party solely as a member of a class of the beneficiaries that
the corporation intends to benefit as part of the accomplishment of its mission
which benefit is available to all similarly situated members of the same class on the
same terms.
N-PCL § 715(a) contains the general prohibition on related party transactions among not-for-
profit organizations, and N-PCL § 112(a)(10), N-PCL § 715(f) and EPTL § 8-1.9 all authorize
the Attorney General to maintain an action to void, enjoin or rescind a related party transaction.
The Complaint contains ample allegations that the Brimelows, acting on behalf of
VDARE, entered into transactions with persons or business entities with which the Brimelows or
their relatives had financial interests without the approval of VDARE’s board.
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To the extent that Defendants might have incorporated VDARE’s argument in support of
the dismissal of fifth cause of action as against VDARE for violations of the same statutory
provisions—which Defendants did not explicitly state in their Affirmation in Support (see
NYSCEF Doc No. 20)—the Court readdresses such arguments anyway.
VDARE argued that N-PCL § 715(f) requires that a related party must receive a “direct”
financial benefit to fall under the statute’s proscription (NYSCEF Doc No. 17, at 5–6). However,
the plain language of the statute negates this argument because it provides that a related party
having “a financial interest” to the transaction—not receiving a direct financial benefit from the
transaction—engages in a related party transaction (N-PCL § 102(a)(24) [emphasis added]).
VDARE’s reliance on Shapiro v Rockville Country Club, Inc. was also misplaced as the
issue in that case was not about whether the related party directly benefited from a corporate
transaction but whether such benefit was equally available to the shareholders of a for-profit
corporation governed by the Business Corporation Law rather than the N-PCL (see 22 AD3d
657, 659 [2d Dept 2005], citing Business Corporation Law § 713(a)).
Equally unavailing was VDARE’s argument that the statute requires a showing of “fault”
to hold a key person of a corporation liable for a related party transaction (NYSCEF Doc No. 17,
8–9). Assuming VDARE used the word “fault” in reference to a culpable mental state (e.g.,
negligence, recklessness or knowledge), the statute lacks this language, and VDARE otherwise
cited no controlling legal authority holding that such a transaction requires one of these mental
states (see N-PCL § 102(a)(24) [“any transaction in which a related party has a financial interest
and in which the corporation or any affiliate of the corporation is a participant”]).
The Court accords no weight to the Defendants’ novel argument, raised for the first time
in reply, that the third cause of action is duplicative of the first, as consideration of an argument
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in support of dismissal pursuant to CPLR § 3211 raised for the first time in reply is improper and
grounds for granting a subsequent motion for renewal (see Dookhie v Woo, 180 AD3d 459, 464–
65 [1st Dept 2020] [“It should be noted that [Defendants’] argument was raised for the first time
in reply, and for that reason should not have been considered, let alone credited”]; see also
Mehra v Morrison Cohen LLP, 203 AD3d 438, 438–39 [1st Dept 2022]).
Accordingly, the Court denies Defendants’ motion to dismiss the third cause of action.
The Court Denies the Motion to Dismiss the Fourth Cause of Action
Neither VDARE nor Defendants made an argument for the dismissal of the fourth cause
of action as against the Defendants for loans issued in violation of N-PCL § 716.
N-PCL § 716 provides:
No loans, other than through the purchase of bonds, debentures, or similar
obligations of the type customarily sold in public offerings, or through ordinary
deposit of funds in a bank, shall be made by a corporation to its directors, officers
or key persons, or to any other corporation, firm, association or other entity in which
one or more of its directors, officers or key persons are directors, officers or key
persons or hold a substantial financial interest, except a loan by one charitable
corporation to another charitable corporation. A loan made in violation of this
section shall be a violation of the duty to the corporation of the directors or officers
authorizing it or participating in it, but the obligation of the borrower with respect
to the loan shall not be affected thereby.
The Complaint alleges that VDARE loaned BBB, a for-profit corporation incorporated by Lydia
Brimelow and owned by VDARE, over $250,000.00 and that BBB never provided VDARE
security for the loan nor paid back any of the loan (NYSCEF Doc No. 1 ¶ 93, 109–10). The
Complaint also alleges that VDARE, through Lydia Brimelow, assigned this property interest to
MSF, a West Virginia corporation at which her father worked, after which BBB began making
payments to MSF (id. ¶¶ 115–16). These allegations are adequate to support the cause of action
under N-PCL § 716.
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The Court accords no weight to the Defendants’ novel argument, raised for the first time
in reply, that the fourth cause of action is duplicative of the first, as consideration of an argument
in support of dismissal pursuant to CPLR § 3211 raised for the first time in reply is improper and
grounds for granting a subsequent motion for renewal (see Dookhie v Woo, 180 AD3d 459, 464–
65 [1st Dept 2020] [“It should be noted that [Defendants’] argument was raised for the first time
in reply, and for that reason should not have been considered, let alone credited”]; see also
Mehra v Morrison Cohen LLP, 203 AD3d 438, 438–39 [1st Dept 2022]).
The Court thus denies Defendants’ motion to dismiss the fourth cause of action.
The Court Denies the Motion to Dismiss the Seventh and Eighth Causes of Action
Executive Law § 172 provides:
1. Every charitable organization, and any charitable organization registered or
required to be registered pursuant to article eight of the estates, powers and
trusts law, except as otherwise provided in section one hundred seventy-two-a of
this article, which intends to solicit contributions from persons in this state or from
any governmental agency shall, prior to any solicitation, file with the attorney
general a prescribed registration form[.]
Executive Law § 172-b(1)–(3) lists the reports that an organization is required to file based on
the organization’s approximate gross revenue. Executive Law § 172-b(5) provides that the
Attorney General “shall cancel the registration of any organization” that fails to comply with the
prior sections.
The Complaint alleges that VDARE failed to timely file the appropriate reports with the
Charities Bureau for fiscal years 2019, 2020, and 2021 (NYSCEF Doc No. 1 ¶¶ 155–56). The
Complaint also alleges that the filing for fiscal year 2021 contained material misrepresentations
by simultaneously stating that VDARE did not receive more than $25,000.00 from New York
residents while also disclosing that it collected between $25,000.00 and $99,000.00 in New York
for that year (id. ¶ 159). Further, the Complaint alleges that the OAG advised VDARE in August
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2024 that its 2021 filing was deficient and its 2022 and 2023 filings were delinquent but that
Lydia Brimelow nevertheless solicited donations on behalf of VDARE as late as July 2025 (id.
¶¶ 151–55).
The Court accords no weight to the Defendants’ novel argument, raised for the first time
in reply, that the seventh cause of action should be dismissed as against Peter Brimelow, as
consideration of an argument in support of dismissal pursuant to CPLR § 3211 raised for the first
time in reply is improper and grounds for granting a subsequent motion for renewal (see Dookhie
v Woo, 180 AD3d 459, 464–65 [1st Dept 2020] [“It should be noted that [Defendants’] argument
was raised for the first time in reply, and for that reason should not have been considered, let
alone credited”]; see also Mehra v Morrison Cohen LLP, 203 AD3d 438, 438–39 [1st Dept
2022]).
The Court thus denies the motion to dismiss the seventh and eighth causes of action for
illegal solicitation of donations and for false or deficient filings as the Complaint contains
allegations sufficient to plead causes of action under the Executive Law.
The Court Denies the Motion to Dismiss the Ninth Cause of Action
VDARE made the argument, which Defendants incorporate here, that the Complaint fails
to state a claim as to the ninth cause of action because the Complaint does not allege that BBB
represented at least 80% of VDARE’s assets such that the sale of BBB to MSF constituted
substantially all of VDARE’s assets.
N-PCL § 510 provides:
(a) A sale, lease, exchange or other disposition of all, or substantially all, the assets
of a corporation may be made upon such terms and conditions and for such
consideration, which may consist in whole or in part of cash or other property, real
or personal, including shares, bonds or other securities of any other domestic or
foreign corporation or corporations of any kind, as may be authorized in accordance
with the following procedure:
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***
(3) If the corporation is, or would be if formed under this chapter, classified as
a charitable corporation under section 201 (Purposes) such sale, lease, exchange
or other disposition shall in addition require approval of the attorney general or
the supreme court in the judicial district or of the county court of the county in
which the corporation has its office or principal place of carrying out the
purposes for which it was formed in accordance with section 511 (Petition for
court approval) or section 511-a (Petition for attorney general approval) of this
article.
The purpose of this provision is “to protect the beneficiaries of a charitable organization from
loss through unwise bargains and from perversion of the use of the property” (Rose Ocko
Found., Inc. v Lebovits, 259 AD2d 685, 688 [2d Dept 1999] [internal quotations omitted]).
The Complaint first alleges that VDARE’s public disclosures regarding whether it listed
BBB as an asset were “inconsistent” (NYSCEF Doc No. 1 ¶ 124). It then alleges that MSF’s
$400,000 offer for the purchase of BBB represented “far more than half” of VDARE’s
reasonably estimated assets and that VDARE did not get approval from the Attorney General or
the Supreme Court before the sale (id. ¶¶ 125–26). The Complaint finally alleges that MSF
purchased VDARE’s ownership interests in BBB, which presumes that VDARE owned interests
in BBB (id. ¶128). Such amounts could have constituted “substantially all” of VDARE’s assets
as the Court is required to give the nonmovant “the benefit of every favorable inference” on a
motion to dismiss (Nomura Home Equity Loan, Inc., Series 2006-FM2 v Nomura Credit &
Capital, Inc., 30 NY3d 572, 582 [2017]).
The Court notes that the Complaint also alleges that VDARE conveyed the Castle
property to BCF and BBB for inadequate consideration, and these transactions could have also
represented substantially all of VDARE’s assets (NYSCEF Doc No. 1 ¶ 96–97).
VDARE cited no controlling legal authority in support of its argument that the OAG was
required to plead that the sale constituted 80% or more of VDARE’s assets to support a claim
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under N-PCL § 510(a). Equally unavailing was VDARE’s argument in reply that the OAG failed
to plead two of the three elements enumerated by Rose Ocko Found., Inc. v Lebovits as the
purported “elements” in that case were not requirements to plead a cause of action under §
510(a) but simply aspects of the Second Department’s reasoning in coming to its decision (259
AD2d 685, 688 [2d Dept 1999]).
The Court accords no weight to the Defendants’ novel argument, raised for the first time
in reply, that the ninth cause of action should be dismissed as N-PCL § 510 does not impose
liability against individual defendants, as consideration of an argument in support of dismissal
pursuant to CPLR § 3211 raised for the first time in reply is improper and grounds for granting a
subsequent motion for renewal (see Dookhie v Woo, 180 AD3d 459, 464–65 [1st Dept 2020] [“It
should be noted that [Defendants’] argument was raised for the first time in reply, and for that
reason should not have been considered, let alone credited”]; see also Mehra v Morrison Cohen
LLP, 203 AD3d 438, 438–39 [1st Dept 2022]).
Accordingly, the Court denies Defendants’ motion to dismiss the ninth cause of action.
CONCLUSION
Accordingly, it is hereby:
ORDERED that the motion of Peter Brimelow and Lydia Brimelow (mot. seq. 002) is
denied in its entirety; and it is further
ORDERED that Peter Brimelow and Lydia Brimelow serve Plaintiff with an Answer to
the Complaint within ten (10) days after service notice of entry; and it is further
ORDERED that, within twenty (20) days from entry of this order, Plaintiff shall serve a
copy of this order with notice of entry on the Clerk of the General Clerk’s Office (60 Centre
Street, Room 119, New York, NY 10007); and it is further
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ORDERED that such service upon the Clerk shall be made in accordance with the
procedures set forth in the Protocol on Courthouse and County Clerk Procedures for
Electronically Filed Cases (accessible at the “E-Filing” page on the court’s website at the
address www.nycourts.gov/supctmanh); and it is further
ORDERED that the parties appear for a virtual preliminary conference via MS Teams on
April 14, 2026, at 12 pm.
This constitutes the decision and order of this Court.
3/17/2026
DATE SABRINA KRAUS, J.S.C.
CHECK ONE: CASE DISPOSED NON-FINAL DISPOSITION
□
GRANTED X DENIED GRANTED IN PART OTHER
APPLICATION: SETTLE ORDER SUBMIT ORDER
□
CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE
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