On March 3, 2022, the New York Appellate Division revived a claim that a New York law firm and two of its attorneys breached their fiduciary duties to Smith Villazor’s clients Sanjiv Mehra and a related trust. Mr. Mehra is the co-founder of the consumer-products brand EOS, best known for its colorful, egg-shaped lip balms. Smith Villazor brought the lawsuit on behalf of Mr. Mehra and the trust, alleging that a New York law firm and its attorneys advised Mr. Mehra’s business partner Jonathan Teller how to harm Mr. Mehra’s interests under an operating agreement the law firm drafted for Mr. Mehra years earlier. That alleged conduct, the Appellate Division found, “state[d] a claim against defendants for breach of fiduciary duty.” The Appellate Division reversed the lower court’s finding that a provision in the operating agreement waived Mr. Mehra’s claim, finding that “conflicting and ambiguous language” in the agreement precluded dismissal. Brian Burns of Smith Villazor argued the appeal for Mr. Mehra. A copy of the New York Appellate Division’s decision is here.
March 5, 2022