Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA719423
`ESTTA Tracking number:
`01/09/2016
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`91217618
`Defendant
`Trump Your Competition, Inc.
`ROD UNDERHILL
`ROD UNDERHILL ESQ
`PO BOX 1238
`JULIAN, CA 92036-1238
`UNITED STATES
`MP3Rod@aol.com
`Defendant's Notice of Reliance
`Rod Underhill, Attorney of record
`MP3Rod@aol.com
`/RodUnderhill/
`01/09/2016
`Notice of Reliance Defendant TYC 1.pdf(2928785 bytes )
`
`Proceeding
`Party
`
`Correspondence
`Address
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`Submission
`Filer's Name
`Filer's e-mail
`Signature
`Date
`Attachments
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`

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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
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`Opposition No. 91217618
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`APPLICANT’S NOTICE OF RELIANCE
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`Pursuant to Section 704.02 of the Trademark Trial and Appeal Board Manual of Procedure
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`(“T.B.M.P.”), Applicant Trump Your Competition, Inc. (“Applicant”) hereby gives notice that it
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`will rely on the documents described below and attached as exhibits to the accompanying Appendix
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`to support Applicant’s case.
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`1. (Now cancelled) U.S. Trademark Registration Owned or Controlled by Applicant –
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`T.B.M.P. § 704.03(a)-(b): Attached as Appendix Exhibit 1 is a true and accurate copy of the
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`registration certificate for the prior U.S. trademark registration owned by Applicant or an entity
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`controlled by Applicant, as obtained and accessed from TDSR, containing the words TRUMP
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`YOUR COMPETITION, accessed and printed on January 9th, 2016. Also included, as obtained and
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`accessed from TDSR, is a print out showing the prosecution history, current status and owner of the
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`cancelled mark, printed out on January 9th, 2016. This prior registration, now cancelled, is offered to
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`establish and prove prior registration of the same or similar mark by Applicant.
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`The details of the Applicant’s prior and now cancelled registration are as follows:
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`Mark: TRUMP YOUR COMPETITION
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`Registration No.: 3095214
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`Owner: Seruga, Anthony Joseph
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`1
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`Date Cancelled: Dec. 28, 2012 (Section 8)
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`2. Official Record of Supreme Court of New York, County of New York: Part 55,
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`People v. Trump Entrepreneur Initiative, New York State Supreme Court, New York County,
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`No. 451463/2013, Index No. 45143/13, Decision/Order, as issued by the Court on 10/08/2014 by
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`Hon. Cynthia S. Kern, and is a true and correct copy of the same, and attached as Appendix
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`Exhibit 2. T.B.M.P. § 704.07: Retrieved and printed from the Supreme Court of New York,
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`County of New York, website (http://www.nycourts.gov/courts/1jd/supctmanh/) on January 3,
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`2016. Offered to prove that Opposer Donald J. Trump has been found personally liable for a per se
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`violation of New York State Educ. Law § § 5001-5010 regarding the unlawful use in commerce
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`of his TRUMP house mark, additional TRUMP marks, name and brand in conjunction with Donald
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`J. Trump’s “TRUMP UNIVERSITY” commercial enterprise and to establish Opposer’s unclean
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`hands, with each applying to the Opposer’s instant attempts to establish priority of his various
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`TRUMP related marks, including his house mark.
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`3. Official Record of the United States District Court, Southern District of California,
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`Art Cohen v. Donald J. Trump, Case No., 13CV2519 DMS RBB, Class Action Complaint for
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`Violation of 18 U.S.C. § 1962(c). T.B.M.P. § 704.07. Attached as Appendix Exhibit 3. Offered
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`to show the related third party allegations as presented in the Complaint, along with included
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`exhibits, that directly demonstrate unlawful use and unclean hands of the Opposer, and submitted to
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`demonstrate third party allegations of unlawful misuse of the TRUMP marks in commerce,
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`including the Trump House Mark, which resulted in a federal class action certification, and
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`Opposer’s unclean hands. Also offered to establish the allegations concerning a wide extent of
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`unlawful commercial use of Opposer’s TRUMP marks including the TRUMP house mark in
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`relation to Opposer’s per se violation of New York New York State Educ. Law §§ 5001-5010. Also
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`offered to show extent of financial damages claimed by class plaintiffs that directly resulted from
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`2
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`Opposer Donald J. Trump’s unlawful use of his marks, including his house mark. Retrieved
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`January 6, 2016, from the United States District Court’s online record system.
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`4. Official Record of the United States District Court, Southern District of California,
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`Art Cohen v. Donald J. Trump, Case No., 13CV2519 DMS RBB, Order Granting Motion for
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`Class Certification, issued on 10/24/2014. T.B.M.P. § 704.07. Attached as Appendix Exhibit 4.
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`Offered to show class certification in re: Art Cohen v. Donald J. Trump.
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`Respectfully submitted on behalf of the Applicant by the undersigned attorney.
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`Rod Underhill,
`Attorney for Applicant
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`Dated: Julian, California
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`January 9, 2016
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`3
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`

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`CERTIFICATE OF SERVICE
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`I hereby certify that a copy of the APPLICANT’S NOTICE OF RELIANCE is
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`being served on January 9th, 2016 by first class mail and email upon counsel for Opposer as
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`follows:
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`Dated: Julian, California
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`January 9th, 2016
`
`Lena Saltos
`One Battery Park Plaza
`New York, New York 10004
`Email: l e n a . s a l t o s @ h u g h e s h u b b a r d . c o m
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`
`
`Rod Underhill
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`Exhibit 1
`Exhibit 1
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`

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`Int. Cl.: 41
`
`Prior U.S. Cls.: 100, 101 and 107
`
`United States Patent and Trademark Office
`
`Reg. No. 3,095,214
`Registered May 23, 2006
`
`SERVICE MARK
`PRINCIPAL REGISTER
`
`Trump Your
`Competition
`
`SERUGA, ANTHONY JOSEPH (UNITED STATES
`INDIVIDUAL)
`555 N. EL CAMINO REAL, #A-460
`SAN CLEMENTE, CA 92672
`
`FOR: PROVIDING NON-DOWNLOADABLE
`NEWSLETTERS IN THE FIELD OF MARKETING
`AND COMMERCIAL DATA RELEVANT TO TAR-
`GETED INDUSTRIES VIA THE INTERNET AND E-
`MAIL , IN CLASS 41 (US. CLS. 100, 101 AND 107).
`
`FIRST USE 12-5-2004; IN COMMERCE 1-10-2005.
`
`THE MARK CONSISTS OF STANDARD CHAR-
`ACTERS WITHOUT CLAIM TO ANY PARTICULAR
`FONT. STYLE, SIZE, OR COLOR.
`
`SER. NO. 78-561,365, FILED 2-5-2005.
`
`CARRIE ACHEN, EXAMINING ATTORNEY
`
`

`
`Generated on:
`
`This page was generated by TSDR on 2016-01-09 19:36:42 EST
`
`Mark: TRUMP YOUR COMPETITION
`
`US Serial Number: 78561365
`
`Application Filing Date:
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`Feb. 05, 2005
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`US Registration Number: 3095214
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`May 23, 2006
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`Principal
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`Service Mark
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`Register:
`
`Mark Type:
`
`Status:
`
`Registration Date:
`
`Registration cancelled because registrant did not file an acceptable declaration under Section 8. To view all documents in this file, click
`on the Trademark Document Retrieval link at the top of this page.
`
`Status Date:
`
`Dec. 28, 2012
`
`Publication Date: Nov. 08, 2005
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`Date Cancelled: Dec. 28, 2012
`
`
`
`Mark Literal Elements:
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`TRUMP YOUR COMPETITION
`
`Standard Character Claim:
`
`Mark Information
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`Yes. The mark consists of standard characters without claim to any particular font style, size, or color.
`
`Mark Drawing Type:
`
`4 - STANDARD CHARACTER MARK
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`Goods and Services
`
`Note: The following symbols indicate that the registrant/owner has amended the goods/services:
`
`Brackets [..] indicate deleted goods/services;
`Double parenthesis ((..)) identify any goods/services not claimed in a Section 15 affidavit of incontestability; and
`Asterisks *..* identify additional (new) wording in the goods/services.
`
`For:
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`Providing non-downloadable newsletters in the field of marketing and commercial data relevant to targeted industries via the Internet
`and e-mail
`
`International Class(es): 041 - Primary Class
`
`U.S Class(es):
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`100, 101, 107
`
`Class Status:
`
`SECTION 8 - CANCELLED
`
`Basis:
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`1(a)
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`Jan. 10, 2005
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`First Use: Dec. 05, 2004
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`Use in Commerce:
`
`Basis Information (Case Level)
`
`Filed Use: Yes
`
`Currently Use: Yes
`
`Amended Use: No
`
`

`
`Filed ITU: No
`
`Filed 44D: No
`
`Filed 44E: No
`
`Filed 66A: No
`
`Filed No Basis: No
`
`Currently ITU: No
`
`Currently 44D: No
`
`Currently 44E: No
`
`Currently 66A: No
`
`Amended ITU: No
`
`Amended 44D: No
`
`Amended 44E: No
`
`Currently No Basis: No
`Current Owner(s) Information
`
`Owner Name:
`
`Seruga, Anthony Joseph
`
`Owner Address:
`
`555 N. El Camino Real, #A-460
`San Clemente, CALIFORNIA UNITED STATES 92672
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`Legal Entity Type: INDIVIDUAL
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`UNITED STATES
`
`Citizenship:
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`Attorney/Correspondence Information
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`Attorney Name: Rod Underhill
`
`Attorney Primary Email
`Address:
`
`MP3Rod@aol.com
`
`Yes
`
`Correspondent
`Name/Address:
`
`ROD UNDERHILL
`ROD UNDERHILL ESQ
`PO BOX 1238
`2245 HWY 78
`JULIAN, CALIFORNIA UNITED STATES 92036-1238
`
`Phone: 619-540-0631
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`Correspondent e-mail: MP3Rod@aol.com
`
`Yes
`
`Attorney of Record
`
`Correspondent
`
`Attorney Email
`Authorized:
`
`Correspondent e-mail
`Authorized:
`
`Domestic Representative - Not Found
`Prosecution History
`
`Date
`
`Description
`
`Dec. 28, 2012
`May 23, 2006
`Apr. 08, 2006
`Nov. 28, 2005
`Nov. 08, 2005
`Oct. 19, 2005
`Sep. 21, 2005
`Sep. 16, 2005
`Sep. 10, 2005
`Sep. 08, 2005
`Sep. 08, 2005
`Sep. 08, 2005
`Sep. 02, 2005
`Feb. 14, 2005
`
`CANCELLED SEC. 8 (6-YR)
`REGISTERED-PRINCIPAL REGISTER
`EXTENSION OF TIME TO OPPOSE PROCESS - TERMINATED
`EXTENSION OF TIME TO OPPOSE RECEIVED
`PUBLISHED FOR OPPOSITION
`NOTICE OF PUBLICATION
`LAW OFFICE PUBLICATION REVIEW COMPLETED
`ASSIGNED TO LIE
`APPROVED FOR PUB - PRINCIPAL REGISTER
`EXAMINER'S AMENDMENT ENTERED
`EXAMINERS AMENDMENT E-MAILED
`EXAMINERS AMENDMENT -WRITTEN
`ASSIGNED TO EXAMINER
`NEW APPLICATION ENTERED IN TRAM
`TM Staff and Location Information
`
`Current Location: PUBLICATION AND ISSUE SECTION
`
`Date in Location:
`
`May 23, 2006
`
`TM Staff Information - None
`File Location
`
`Proceeding
`Number
`
`65287
`65287
`
`88888
`6328
`80807
`80807
`
`

`
`Proceedings
`
`Type of Proceeding: Extension of Time
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`
`
`Filing Date:
`
`Status Date:
`
`Defendant
`
`Application Status
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`Cancelled - Section 8
`Potential Opposer(s)
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`Serial
`Number
`78561365
`
`Registration
`Number
`3095214
`
`Summary
`
`Number of Proceedings:
`
`1
`
`Proceeding Number: 78561365
`
`Nov 26, 2005
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`Apr 08, 2006
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`Status: Terminated
`
`Interlocutory Attorney:
`
`Name:
`
`Seruga, Anthony Joseph
`
`Correspondent Address:
`
`ROD UNDERHILL
`ROD UNDERHILL, ESQ.
`PO BOX 1238 2245 HIGHWAY 78
`JULIAN CA UNITED STATES , 92036-1238
`Associated marks
`
`Mark
`
`TRUMP YOUR COMPETITION
`
`Name:
`
`Central Mfg Co. (Inc)
`
`Correspondent Address:
`
`Leo Stoller
`Central Mfg Co. (Inc)
`P.O. Box 35189
`Chicago IL UNITED STATES , 60707-0189
`
`Correspondent e-mail:
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`ldms4@hotmail.com
`
`Entry Number
`
`1
`2
`
`History Text
`INCOMING - EXT TIME TO OPPOSE FILED
`EXTENSION OF TIME GRANTED
`
`Date
`Nov 26, 2005
`Nov 28, 2005
`
`Due Date
`
`Prosecution History
`
`

`
`Exhibit 2
`Exhibit 2
`
`

`
`FILED: NEW YORK COUNTY CLERK 10/15/2014 11:18 AM
`FILED:
`~ W YORK COUNTY CLERK 102014 11:18 ‘
`NYSCEF DOC. NO. 134
`NYSCEF DOC. NO. 134
`
`INDEX NO. 451463/2013
`INDEX NO- 451463/2013
`RECEIVED NYSCEF: 10/15/2014
`RECEIVED NYSCEF: 10/15/2014
`
`SUPREME COURT OF THE STATE OF NEW YORK
`
`NEW YORK COUNTY
`
`/s/'*
`
`PRESENT:
`
`CYNTNA 8' K55 C.
`
`RN
`
`'
`
`'
`
`PART
`
`INDEX No.
`MOTION DATE
`
`M0110" 550- NO-
`
`I No(s).
`
`I No(s).
`
`| No(s).
`
`Justice
`
`E
`
`Index Number : 451463/2013
`
`[ PEOPLE OF THE STATE OF
`E
`V5"
`I TRUMP ENTREPRENEUR
`-
`SEQUENCE NUMBER : 004
`I OTHER RELIEFS :f
`
`The following papers, numbered 1 to
`
`, were read on this motion to/for
`
`Notice of Motion/Order to Show Cause — Affidavits — Exhibits
`
`Answering Affidavits —- Exhibits
`
`Replying Affidavits
`
`Upon the foregoing papers, it is ordered that this motion is
`
`is decided i_n_ac_g:ordance with the annexed decision.
`
`
`
`MOTIONICASEISRESPECTFULLYREFERREDToJUSTICE
`
`
`
`
`
`FORTHEFOLLOWINGREASON(S):
`
`Dated:
`
`5!) ‘Q hf‘
`
`1. CHECK oNE: ..................................................................... [3 CASE DISPOSED
`
`E
`, KERN
`.
`J.s_C.
`C‘(NTH‘A S
`;2(NoN-FINAL DISPOSITION
`
`,J_s_c_
`
`2. CHECK As APPROPRIATE: ......................... ..MOTlON IS: 1:] GRANTED
`
`E] DENIED
`
`Ci GRANTED IN PART
`
`B OTHER
`
`3. CHECK IF APPROPRIATE: .............................................. .. E] SETTLE ORDER
`
`C SUBMIT ORDER
`
`E] DO NOT POST
`
`D FIDUCIARY APPOINTMENT D REFERENCE
`
`

`
`SUPREME COURT OF THE STATE OF NEW YORK
`COUNTY OF NEW YORK: Part 55
`________________________________________________________________________X
`
`In the Matter of the Application of
`
`THE PEOPLE OF THE STATE OF NEW YORK, by
`ERIC T. SCHNEIDERMAN, Attorney General of the
`State of New York,
`
`‘
`
`1
`
`Petitioner,
`
`Index No. 451463/13
`
`-against-
`
`DECISION/ORDER
`
`-
`
`THE TRUMP ENTREPRENEUR INITIATIVE LLC
`
`f/k/a TRUMP UNIVERSITY LLC, DJT
`
`ENTREPRENEUR MEMBER LLC f/k/a DJT
`
`UNIVERSITY MEMBER LLC, DJT ENTREPRENEUR
`MANAGING MEMBER LLC f/k/a DJT UNIVERSITY
`
`MANAGING MEMBER LLC, THE TRUMP
`
`ORGANIZATION, INC., TRUMP ORGANIZATION LLC,
`
`DONALD J. TRUMP and MICHAEL SEXTON,
`
`Respondents.
`...................................................................... --x
`
`HON. CYNTHIA S. KERN, J.S.C.
`
`Recitation, as required by CPLR 2219(a), of the papers considered in the review of this motion
`for :
`»
`
`Papers
`
`Numbered
`
`Notice of Petition and Petition Annexed .................................. .. T1:
`
`Answering Affidavits.................................................................... ..
`Notion of Motion and Affidavits Annexed ................................... ..
`Affidavits in Opposition to Motion......................................... ..
`Replying Affidavits.................................................................... ..
`Exhibits .................................................................................... ..
`
`2,3,4
`5,6,7
`8
`
`9 P
`
`etitioner The People of the State of New York, by Eric T. Schneiderman, Attorney
`
`General of the State of New York (“petitioner”) commenced the instant special proceeding
`
`pursuant to Executive Law (“Exec. Law”) § 63(12) seeking an Order (1) enjoining respondents
`
`

`
`6:I i
`
`The Trump Entrepreneur Initiative LLC f/k/a Trump University LLC, DI:T Entrepreneur Member
`LLC, DJT Entrepreneur Managing Member LLC, The Trump Organization, Inc., Trump
`Organization LLC and Donald J. Trump (collectively hereinafier referred; to as the “Trump
`Respondents”) and Michael Sexton (“Mr. Sexton”) from violating Exec. I,aw § 63(12), General
`Business Law (“GBL”) §§ 349 and 350, Education Law (“Educ. Law”)
`224 and 5001-5010
`and 16 C.F.R. § 429 and from engaging in specific fraudulent, deceptive and illegal acts; (2)
`
`directing respondents to provide petitioner the name and address of each former customer of
`|
`'l
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`respondents and the amount of money received from each such former customer; (3) directing
`i
`
`respondents to make full monetary restitution and pay damages to all injured personsor entities;
`
`(4) directing respondents to produce an accounting of profits and to disgofrge all profits resulting
`from the alleged fraudulent and illegal practices; (5) directing respondenté to pay a civil penalty
`to the State ofNew York ofup to $5,000.00 for each violation of GBL Article 22-A pursuant to
`GBL § 350-d; and (6) awarding petitioner additional costs of $2,000.00 against each respondent
`pursuant to CPLR § 8303(a)(6).
`In or around October 2013, the Trump Riespondents and Mr.
`Sexton separately moved for an Order dismissing the petition or, in the alternative, for leave to
`
`serve and file answers in opposition to the petition.
`In a decision dated January 30, 2014, this
`court granted in part and denied in part the Trump Respondents’ and Mr. ':Sexton’s motions to
`dismiss and granted them leave to file answers as to those portions ofthepetition the court did
`not dismiss. Petitioner has since re-noticed the petition and seeks a sumrriary determination
`
`against Mr. Sexton and the Trump Respondents on the petition’s remaining causes of action for
`
`(1) violation of Exec. Law § 63(12); (2) violation of GBL § 349; (3) violation ofGBL § 350; (4)
`violation of Educ. Law §§ 5001-5010; and (5) violation of 16 C.F.R. § 42? along with a
`
`I
`
`permanent injunction enjoining all respondents “from engaging in the fraudulent, deceptive, and
`
`

`
`if
`
`illegal acts and practices alleged in the Verified Petition.” The Trump Respondents move for an
`
`Order (1) pursuant to CPLR § 103(c) converting this special proceeding into a plenary action; or,
`
`'1
`.
`.
`in the alternative, (2) pursuant to CPLR §§ 408, 3101 and 3102(a) & (f) granting them leave to
`
`conduct discovery. Mr. Sexton moves separately for relief identical to that of the Trump
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`Respondents. Finally, petitioner moves separately for an Order striking (l) the Trump
`
`Respondents’ counterclaim alleging malicious prosecution; and (2) all of‘the affirmative defenses
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`raised by the Trump Respondents and Mr. Sexton in their respective answers. The motions are
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`consolidated for disposition and are resolved as set forth below.
`
`I
`
`The relevant facts are as follows.
`
`In 2004, respondent Mr. Sexton, an entrepreneur,
`i
`
`approached respondent Mr. Trump, a real estate developer, with the concept of developing a
`company that would primarily use technology to provide an instructional burriculum to small
`
`business owners and individual entrepreneurs across a broad range of business subjects such as
`
`J!
`
`marketing, finance, sales, entrepreneurship and real estate under the “Trump” name and brand.
`'1
`1
`On October 25, 2004, “Trump University LLC” (“Trump University”), a New York limited
`
`liability company, was formed with the New York Department of State, l?ivision of
`
`Corporations, with the stated purpose of providing “education-related
`
`educational products
`
`and services to individuals and businesses.”
`
`Throughout its operation, Trump University allegedly offered instruction and training in
`
`various business topics across a variety of platforms, including on-line courses, in-person
`
`seminars and one-on-one mentorships. Specifically, the students took pait in a free seminar at
`
`1I
`
`which Trump University instructors would recommend signing up for a three-day seminar which
`1
`
`cost approximately $1,500 at which the instructors would teach certain real estate strategies. It
`_
`I
`
`was also at these seminars that the instructors recommended signing up for the Trump Elite
`
`

`
`l
`
`Programs, including the year-long mentorships which involved a Trump University mentor who
`l
`allegedly would work with the student on real estate deals and cost upwards of $20,000. On May
`l
`27, 2005, Trump University received a letter, addressed to Mr. Trump, from the New York State
`
`Education Department (“SED”) concerning its use of the word “University” in its name and the
`
`fact that it was not licensed by the SED. SED informed Trump University that it would not be
`I
`
`subject to the licensure requirement if it maintained its place of business
`
`its corporate
`
`organizations outside New York State and if it did not run live programs or other live training in
`
`New York State. Mr. Sexton, Trump University’s President, responded that a new LLC would
`
`be created in Delaware which would be merged with the New York LLC
`
`that Trump
`
`University would refrain from holding live programs in New York State. :
`l’etitioner alleges that Trump University continued its operations and failed to abide by
`
`the conditions by failing to merge the New York and Delaware LLCs, continuing to operate its
`
`business out of its office in New York City and continuing to hold live priograms in New York.
`
`A;
`
`On March 30, 2010, the SED, allegedly in response to a Trump University student’s complaint,
`l
`
`cease using the word
`sent Trump University a letter, addressed to Mr. Trump, demanding that
`“University” in its name. On May 21, 2010, Trump University filed a cerjtificate ofamendment
`
`to its Articles of Organization formally changing its name to Trump Entrepreneur Initiative LLC
`(“TEI”).
`In early 2011, shortly after assuming office, Attorney General Eric: T. Schneidennan (the
`“AG”) commenced an investigation into for-profit universities and trade schools operating in
`New York State. On or about May 17, 201 1, the AG issued TEI a subpoelna duces tecum (the
`
`“Subpoena”) seeking documents and information pertaining to its business practices. Over the
`
`next two years, TEI and the respondents complied with the Subpoena by turning over hundreds
`
`4
`
`

`
`of thousands of pages of documents and making certain employees of TEI available for
`l.
`
`deposition. On August 24, 2013, petitioner commenced the instant special proceeding against
`the Trump Respondents and Mr. Sexton seeking, inter alia, an injunction‘ and damages, for
`alleged fraudulent behavior in the operation ofTEI. Although the suit
`filed on August 24,
`
`‘I
`
`2013, respondents previously agreed to toll the statute of limitations, effective May 31, 2013.
`After the Trump Respondents and Mr. Sexton moved to dismiss the petition on the ground that,
`inter alia, the causes ofaction are barred by the statute oflimitations, this court issued a decision,
`dated January 30, 2014, dismissing petitioner’s claims brought pursuant to GBL §§ 349 and 350
`
`which accrued prior to May 31, 2010; dismissing petitioner’s claims brought pursuant to Educ.
`
`Law § 224 in their entirety; dismissing petitioner’s claims brought pursuaiit to Educ. Law §§
`
`5001-5010 which accrued prior to May 31, 2010 and denying petitioner’s;:request for a summary
`determination on that cause ofaction‘on the ground that “there exists an issue offact as to
`whether TEI was operating in New York State on or after May 31, 2010";'l dismissing petitioner’s
`
`claims brought pursuant to 16 C.F.R. § 429 which accrued prior to May 321, 2010; and denying
`!
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`those portions of respondents’ motions which sought to dismiss petitioner’s request for a
`l
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`permanent injunction.
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`;
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`The court first turns to that portion ofthe Trump Respondents
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`Mr. Sexton’s motions
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`for an Order pursuant to CPLR §l03 (c) converting this special proceeding into a plenary action.
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`Exec. Law § 63(l2) grants the AG the authority to bring a special proceeding pursuant to Article
`4 of the CPLR to enjoin ongoing fraudulent or illegal business practices targeted at consumers in
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`New York State. Indeed, “[a] special proceeding, as authorized by Execu:tive Law § 63(l2), is
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`intended as an expeditious means for the Attomey-General to prevent further injury and seek
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`relief for the victims of business fraud.” People v. Apple Health & Sports Clubs, 206 A.D.2d
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`266, 268 (l“ Dept 1994). However, “if the court finds it appropriate in the interests ofjustice, it
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`may convert a motion into a special proceeding, or vice-versa, upon such terms as may be just,
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`including payment of fees and costs.” CPLR § 103(c). Generally,’ the purpose and long-standing
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`use of CPLR § 103(c) is to allow a court to avoid dismissals of cases thatiwere mistakenly
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`brought in the wrong form. See Nationwide Mut. Ins. Co. v. Hausen, 143'A.D.2d 577 (1“ Dept
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`1988).
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`Here, that portion of the respondents’ motions for an Order pursuant to CPLR § lO3(c)
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`converting this special proceeding into a plenary action is denied as respoindentsvhave not
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`established a basis for such relief. As an initial matter, it is clear that petitioner was entitled to
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`commence this action as a special proceeding pursuant to Exec. Law § 63(12) and that it was not
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`improperly brought as such. Moreover, this action should proceed as a special proceeding, which
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`allows for expeditious relief, based on this court’s finding that the AG may be entitled to an
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`injunction as it is unclear whether respondents intend to renew the alleged fraudulent conduct at a
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`later date. Respondents’ reliance on Matter ofState ofNew York v. Seapoirt Manor A. C.F., 2003
`N.Y. Misc. LEXIS 2025 (Sup. Ct., Kings Cty, June 1 1, 2003)(mod on other grounds by 19
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`A.D.3d 609 (2d Dept 2005)) is misplaced as that case is distinguishable. Seaport Manor
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`involved a special proceeding commenced by the AG pursuant to Exec. Law § 63(l 2) against
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`Seaport Manor, an adult home facility, and its individual principals seekirig, inter alia, injunctive
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`relief and damages based on violations of, inter alia, GBL §§ 349 and 350. The court converted
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`the proceeding to a plenary action based on the fact that there was no need for expeditious relief
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`as Seaport Manor was officially closed and that the only cause of action left in the case was one
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`for the recovery of unpaid penalties.
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`The court next turns to the petition which seeks a summary determination on its
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`remaining causes of action. Pursuant to Exec. Law § 63(12),
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`Whenever any person shall engage in repeated fraudulent or illegal
`acts or otherwise demonstrate persistent fraud or illegality in the
`carrying on, conducting or transaction of business, the attorney
`general may apply, in the name of the people of the state of New
`York, to the supreme court of the state of New York,...for an order
`enjoining the continuance of such business activity or of any
`fraudulent or illegal acts, directing restitution and damages...and
`the court may award the relief applied for or so much thereof as it
`may deem proper.
`'
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`After providing respondent an opportunity to answer the petition, “[t]he court shall make a
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`summary determination upon the pleadings, papers and admissions to the.extent that no triable
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`issues of fact are raised. The court may make any orders permitted on a motion for summary
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`judgment.” CPLR § 409(b). Indeed, in determining whether the summary determination of the
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`petition is warranted, the court must apply the same standards as are applied in summary
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`judgment motions. See Part ofN. Y. xluth. v. 62 Cortlandt St. Realty Co., 18 N.Y.2d 250 (1966);
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`see also People v. City Model & Talent Dev., 29 Misc.3d 1205 (Sup. Ct. Suffolk Co. 20l0)(“a
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`special proceeding brought under CPLR article 4 is subject to the same standard of proof as a
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`motion for summary judgment made in an action.”) If the court finds a triable issue of fact exists
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`with regard to any claim asserted in the petition, a hearing shall be conducted in order that such
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`issue may “be tried forthwith and the court shall make a final determination thereon.” CPLR §
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`410.
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`On a motion for summary judgment, the movant bears the burden ‘of presenting sufficient
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`evidence to demonstrate the absence of any material issues of fact. See Alvarez v. Prospect
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`Hosp., 68 N.Y.2d 320, 324 (1986). Summary judgment should not be granted where there is any
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`doubt as to the existence of a material issue of fact. See Zuckerman v. City ofNew York, 49
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`N.Y.2d 557, 562 (1980). Once the movant establishes a primafacie right to judgment as a
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`matter of law, the burden shifts to the party opposing the motion to “produce evidentiary proof in
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`admissible form sufficient to require a trial of material questions of fact on which he rests his
`\.
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`:I
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`claim.” Id.
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`As an initial matter, respondents’ assertion that petitioner’s request for a summary
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`determination on the remaining causes of action in the petition should be denied on the ground
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`that “[t]his is the second time the AG has asked the Court for such relief,”; is without merit as this
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`is the first time that petitioner has requested a summary determination on all of the causes of
`I1
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`action asserted in the petition with the exception of its cause of action for-fa violation of Educ.
`1
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`Law §§ 5001-5010. Indeed, after petitioner commenced the instant special proceeding,
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`respondents moved to dismiss the petition on statute of limitations grounds. Thus, the court
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`addressed only respondents’ motion to dismiss and did not address whether petitioner was
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`entitled to a summary determination on all of its claims. Further, at the time this court addressed
`I
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`respondents’ motion to dismiss, respondents had not yet interposed an answer to the petition and
`thus, the court could not determine at that time whether issues of fact existed to warrant a hearing
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`pursuant to CPLR § 410.
`t
`R
`In_the instant proceeding, petitioner has failed to establish its rightito a summary
`determination against TEI on its first cause of action alleging a violation (if Exec. Law § 63(12)
`on the ground that there is no standalone cause ofaction for a violation of Exec. Law § 63(12).
`Thus, this court searches the record and finds that such claim must be dismissed pursuant to
`CPLR § 3212(b). The Court ofAppeals has held that Exec. Law § 63(12l does not create an
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`independent cause of action but rather provides the AG with standing to sieek redress and specific
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`remedies against fraudulent behavior. See State ofNew York v. Cortelle, 38 N.Y.2d 83 (1975)
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`Cortelle involved an action brought by the AG pursuant to Business Corporation Law § 1 101 and
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`Exec. Law § 63(12) to enjoin allegedly fraudulent practices and to obtain iedress for defrauded
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`persons. The issue before the court waswhether certain causes of action were subject to a three-
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`year statute of limitations on the ground that they rely on liabilities, penalties or forfeitures
`—l
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`created or imposed by statute pursuant to CPLR § 214(2). The Court of Appeals found that the
`I
`.
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`claims, which had been dismissed by the lower court, were not subject to three-year statute of
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`limitations on the ground that “[Exec. Law § 63(12)] did not ‘make’ unlaiivfiil the alleged
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`_ fraudulent practices, but only provided standing in the Attomey-General to seek redress and
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`additional remedies for recognized wrongs which pre-existed the statutes’: based on the well-
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`settled principle that “[s]tatutory provisions which provide only additional remedies or standing
`I
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`do not create or impose new obligations.” Id at 85. Specifically, the Court of Appeals held that
`there is no independent Exec. Law § 63(l2) cause ofaction but rather such statute “only
`provide[s] particular remedies and standing in a public officer to seek redress on behalfofthe
`State and others.” Id. at 86.
`;
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`Additionally, as recently as 2013, the First Department has also held that Exec. Law §
`63(12) is not a standalone cause ofaction. See People v. Schwab, 109 A.l§).3d 445 (l“ Dept
`2013). Schwab involved an action brought by the AG pursuant to the Maritin Act, GBL § 349
`and Exec. Law § 63(l2) alleging fraudulent and ‘deceptive conduct in the gale ofaction rate
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`securities to the investing public. The issue before the court was whether the petition was
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`properly dismissed on the ground that it failed to state a claim. The First l)epartment, citing to
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`. Cortelle, held that “[t]he first cause of action was properly dismissed inasmuch as Executive Law
`3
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`§ 63(12), upon which it is based, does not create independent claims, but merely authorizes the
`I
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`Attorney General to seek injunctive and other relief on notice prescribed by the statute in cases
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`involving persistent fraud or illegality.” Id. at 449.
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`In light of the clear and well-settled precedent from the Court of Appeals and the First
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`Department, this court held in its January 2014 decision that there was no jviable claim under
`Exec. Law § 63(12). However, based on a liberal reading ofthe petition, the court allowed
`petitioner to proceed instead on a common law fraud cause ofaction, everi though the petitioner
`did not label the claim as such. The court even gave petitioner the opportunity to amend its
`petition to articulate that it was seeking to proceed on a claim ofcommon :law fraud but it
`declined to do so. The court made clear, relying on Cortelle, that as Exec; Law § 63(l2) only
`allows the AG to obtain broader remedies, the AG must still fully make out any claim being
`asserted pursuant to said statute, including its claim for common law fraud.
`Additionally, this court finds that petitioner has failed to establish its right to a summary
`determination against TEI on its claim alleging common law fraud. To recover on a claim of
`common law fraud, a party must establish “misrepresentation ofa material fact, falsity, scienter,
`reliance and injury.” Barclay Arms, Inc. v. Barclay Arms Associates, 74 l\l.Y.2d 644 (1989). It is
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`well-settled that what constitutes reasonable reliance and material misrepnesentation is generally
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`an issue of fact for the jury and not one that can be determined on a motion for summary
`judgment. See Gonzalez v. 40 W. Burnside Ave. LLC, 107 A.D.3d 542, 54:4 (1“ Dept
`2013)(“[w]hether the plaintiff could justifiably rely on the false representation is an issue of
`fact”); see also Brunetti v. Musallam, 11 A.D.3d 280, 281 (1“ Dept 2004)(F‘[t]he issues of
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`material misrepresentation and reasonable reliance, essential elements of fraud claim, are not
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`subject to summary disposition”); see also DDJ Mgt., LLC v. Rhone Groulp L. L. C., 15 N.Y.3d
`147, 155 (2010)(“[t]he question ofwhat constitutes reasonable reliance isalways nettlesome
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`because it is so fact-intensive”); see Talansky v. Schulman, 2 A.D.3d 355,€361 (1“ Dept
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`2003)(“resolution of a reasonable reliance claim is generally left to a finder of fact.”)
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`10
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`Additionally, scienter is established upon clear and convincing proof of a-misrepresentation or a
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`material omission of fact which was false and known to be false and made for the purpose of
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`inducing t