MOHAMMED SALAHUDDIN, DDS, PH.D., AND ROMSA, P.C. (ROCHESTER ORAL AND MAXILLOFACIAL SURGERY ASSOCIATES), PLAINTIFFS-APPELLANTS,
CHRISTINE K. CRAVER AND CARRIE MASSARO, DEFENDANTS-RESPONDENTS.
M. COLOMBO, ROCHESTER (MICHAEL STEINBERG OF COUNSEL), FOR
UNDERBERG & KESSLER, LLP, ROCHESTER (JILLIAN K. FARRAR OF
COUNSEL), FOR DEFENDANTS-RESPONDENTS.
PRESENT: WHALEN, P.J., SMITH, CARNI, NEMOYER, AND TROUTMAN,
from an order of the Supreme Court, Monroe County (Renee
Forgensi Minarik, A.J.), entered May 16, 2017. The order,
inter alia, denied that part of the motion of plaintiffs
seeking summary judgment dismissing the counterclaims and
granted in part the cross motion of defendants for summary
judgment on their counterclaims.
hereby ORDERED that the order so appealed from is unanimously
modified on the law by granting that part of the motion with
respect to the Labor Law §§ 162 (2), 195 (5), and
198 counterclaims and dismissing those counterclaims, denying
that part of the cross motion with respect to the Labor Law
§ 195 (1) (a) counterclaims, striking the amount of $7,
597.98 from the 11th ordering paragraph and replacing it with
the amount of $2, 595.98, and striking the amount of $6,
229.60 from the 25th ordering paragraph and replacing it with
the amount of $1, 229.60, and as modified the order is
affirmed without costs.
Defendants allegedly embezzled over $100, 000 from
plaintiffs, their alleged former employers. Plaintiffs then
commenced this action for fraud, conversion, and breach of
fiduciary duty. Defendants both counterclaimed for, inter
alia, slander per se and the violations of Labor Law
§§ 162 (2), 191 (3), 195 (1) (a), and 195 (5).
Defendant Carrie Massaro also counterclaimed for a violation
of section 198 and for unpaid overtime under the Federal Fair
Labor Standards Act (FLSA). Insofar as relevant here, Supreme
Court denied that part of plaintiffs' motion for summary
judgment dismissing the foregoing counterclaims, and it
granted that part of defendants' cross motion for summary
judgment on the counterclaims under section 195 (1) (a).
Plaintiffs now appeal.
first to the Labor Law § 162 (2) counterclaims, we agree
with the parties that defendants have no private right of
action to enforce that provision (see Hill v City of New
York, 136 F.Supp 3d 304, 350-351 [ED NY 2015]; see
generally Carrier v Salvation Army, 88 N.Y.2d 298, 302
). The court therefore erred in refusing to dismiss the
section 162 (2) counterclaims, and we modify the order
next to the Labor Law § 191 (3) counterclaims.
Initially, plaintiffs' contention that defendants have no
private right of action to enforce section 191 (3) is
improperly raised for the first time on appeal (see
Alberti v Eastman Kodak Co., 204 A.D.2d 1022, 1023 [4th
Dept 1994]). Plaintiffs' remaining challenge to the
section 191 (3) counterclaims, i.e., that no liability exists
under that provision because they acted in good faith and
because it would be fundamentally unfair to hold them liable
under these circumstances, is not a cognizable defense to
liability under section 191 (3). The court thus properly
refused to dismiss the section 191 (3) counterclaims.
next to the Labor Law § 195 (1) (a) counterclaims.
Initially, plaintiffs' contention that these
counterclaims are time-barred is improperly raised for the
first time on appeal (see Aly v Abououkal, Inc., 153
A.D.3d 481, 483 [2d Dept 2017]; Peak Dev., LLC v
Construction Exch., 100 A.D.3d 1394, 1396 [4th Dept
2012]). Similarly, plaintiffs' contention that defendants
have no private right of action to enforce section 195 (1)
(a) is both "unpreserved for appellate review [and]
improperly raised for the first time in [the] reply
brief" (Matter of Cascardo, 130 A.D.3d 822, 823 [2d Dept
2015]). We agree with plaintiffs, however, that the affidavit
of plaintiff Mohammed Salahuddin, DDS, Ph.D. raises triable
issues of fact regarding their potential entitlement to the
affirmative defense provided by section 198 (1-b) (ii).
Contrary to defendants' contention," [a]n unpleaded
affirmative defense may be invoked to defeat a motion for
summary judgment'" (Scott v Crystal Constr.
Corp., 1 A.D.3d 992, 993 [4th Dept 2003]; see
Kapchan v 31 Mt. Hope, LLC, 111 A.D.3d 530, 530-531 [1st
Dept 2013]; Lerwick v Kelsey, 24 A.D.3d 918, 919 [3d
Dept 2005], lv denied 6 N.Y.3d 710');">6 N.Y.3d 710 ). Thus, although
the court properly refused to dismiss the section 195 (1) (a)
counterclaims, the court erred in granting defendants summary
judgment on those same counterclaims given plaintiffs'
potential entitlement to the affirmative defense under
section 198 (1-b) (ii) (see generally Hobart v
Schuler, 55 N.Y.2d 1023, 1024 ; Grodsky v
Moore, 136 A.D.3d 865, 865 [2d Dept 2016]). We therefore
further modify the order accordingly. Plaintiffs'
remaining contention regarding the section 195 (1) (a)
counterclaims is academic in light of our determination.
next to the Labor Law § 195 (5) counterclaims. Although
the legislature specifically authorized a private right of
action to enforce subdivisions (1) and (3) of section 195, it
was silent regarding a private right of action to enforce
section 195 (5) (see § 198 [1-b], [1-d]). Thus, applying
the well-established framework for discerning an implied
private right of action, we agree with plaintiffs that no
private right of action exists to enforce section 195 (5)
(see Carrier, 88 N.Y.2d at 304; Varela v Investors Ins.
Holding Corp., 81 N.Y.2d 958, 961 , rearg denied
82 N.Y.2d 706');">82 N.Y.2d 706 ; Sheehy v Big Flats Community
Day, 73 N.Y.2d 629, 634-636 ). The court therefore
erred in refusing to dismiss the section 195 (5)
counterclaims, and we further modify the order accordingly.
next to Massaro's standalone counterclaim under Labor Law
§ 198. Section 198 "is not a substantive provision,
but [rather] provides for remedies available to a prevailing
employee" (Villacorta v Saks Inc., 32 Misc.3d
1203 [A], 2011 NY Slip Op 51160[U], *3 [Sup Ct, NY County
2011]; see Gottlieb v Kenneth D. Laub & Co., 82
N.Y.2d 457, 459-465 , rearg denied 83 N.Y.2d 801');">83 N.Y.2d 801
; Simpson v Lakeside Eng'g, P.C., 26
A.D.3d 882, 883 [4th Dept 2006], lv denied 7 N.Y.3d 704');">7 N.Y.3d 704
). Thus, Massaro's standalone counterclaim under
section 198 should have been dismissed (see APF Mgt. Co.,
LLC v Munn, 151 A.D.3d 668, 671 [2d Dept 2017]). We
therefore further modify the order accordingly.
finally to the counterclaims for slander per se and for
unpaid overtime under the FLSA. Defendants' counterclaims
for slander per se are replete with triable issues of fact,
and the court therefore properly refused to dismiss them
(see Stich v Oakdale Dental Ctr.,120 A.D.2d 794,
796 [3d Dept 1986]). Moreover, given the well-established
rule that a" party does not carry its burden in moving
for summary judgment by pointing to gaps in its
opponent's proof'" (Brady v City of N.
Tonawanda,161 A.D.3d 1526, 1527 [4th Dept 2018]), the
court properly refused to dismiss Massaro's FLSA
counterclaim. Lastly, plaintiffs' contention that the
FLSA is categorically ...