Logourl black
From our private database of 14,000+ case briefs...

Pappas et al. v. Tzolis

Court of Appeals of New York
N.Y. Slip Op. 06455, App. Div. 1st Dept. (Sept. 15, 2011)


Facts

Steve Tzolis (defendant), Steve Pappas, and Constantine Ifantopoulos (plaintiffs) formed Vrahos LLC (Vrahos) (defendant), a limited liability company (LLC), under Delaware law. The company was formed for a single purpose: leasing a Manhattan building. Tzolis paid the security deposit in exchange for the right to sublease the building, provided he paid additional rent to Vrahos. Vrahos’s operating agreement, which was governed by New York law, provided that the members were free to engage in any outside business, even competing business, and owed no obligation to the company or other members. Tzolis subleased the building but made no rent payments. A few months later, Tzolis negotiated to purchase Pappas’s interest for $1 million and Ifantopoulos’s interest for $500,000. As part of the buyout, the plaintiffs signed a handwritten “certificate” that stated that they had done due diligence, secured legal counsel, and not relied on Tzolis’s representations. The certificate also provided that Tzolis owed no fiduciary duties related to the transaction. Seven months later, Tzolis leased the building to Charlton Soho LLC (Charlton) for $17.5 million. The plaintiffs sued for breach of fiduciary duty and misappropriation of a business opportunity when they learned that Tzolis began negotiating the deal with Charlton before buying them out. The motion court dismissed the complaint on the ground that the operating agreement eliminated Tzolis’s fiduciary duties, pursuant to either Delaware or New York law. The plaintiffs appealed to the Court of Appeals of New York.

Rule of Law

The rule of law is the black letter law upon which the court rested its decision.

To access this section, please start your free trial or log in.

Issue

The issue section includes the dispositive legal issue in the case phrased as a question.

To access this section, please start your free trial or log in.

Holding and Reasoning (Mazzarelli, J.)

The holding and reasoning section includes:

  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

To access this section, please start your free trial or log in.

Dissent (Freedman, J.)

The dissent section is for members only and includes a summary of the dissenting judge or justice’s opinion.

To access this section, please start your free trial or log in.

What to do next…

  1. Unlock this case brief with a free (no-commitment) trial membership of Quimbee.

    You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.

  2. Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.

    Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.

Here's why 175,000 law students have relied on our case briefs:

  • Written by law professors and practitioners, not other law students. 14,000 briefs, keyed to 188 casebooks. Top-notch customer support.
  • The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
  • Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.