Legal Blog

Offit Kurman Wins Jury Trial in the New York Commercial Division in a Complex Securities Case

The New York Supreme Court Westchester County Commercial Division on December 11, 2019, directed entry of judgment in favor of Offit Kurman’s investor clients, the plaintiffs in Hammer et al. v. Reetz et al. (55159/2017), against a registered investment advisor and its principal. This marked the final stages of a lawsuit that started in 2017.

After extensive discovery and summary motion practice in 2017 and 2018, the case came before a jury in the Spring of 2019, and on April 18, 2019, Offit Kurman secured a multi-million dollar jury verdict. The case had been filed in April of 2017, following dismissal without prejudice on pleading grounds in the Southern District of New York for lack of jurisdiction on a 10(b)(5) claim. It was decided that state law claims were stronger than the federal claims, and a recent decision in Supreme Court Westchester County (where defendants are based) made it appropriate to renew the proceedings there.

The case involved claims that the defendants, an investment advisory firm and its principals, had negligently, fraudulently and in breach of their fiduciary duties and contractual obligations mismanaged the investments of the investor plaintiffs and caused substantial losses. The unsuitable investment strategies included low-rated “junk” bonds, such as Puerto Rican general obligations bonds (which defaulted) and an unbalanced portfolio emphasizing equities and energy and shipping securities. The investor plaintiffs are two generations of a family of conservative investors, some of which were approaching or were at retirement; others were decades from retirement. Other claims included misrepresentations as to the nature and genesis of the firm.

During discovery, Offit Kurman discovered that defendants had essentially kept no records of the plaintiffs’ investment objectives, risk tolerances, and cash requirements and that no records were kept concerning investment decisions or portfolio research. Contrary to representations made to plaintiffs and the public, defendants did not tailor their investment portfolios to suit the clients’ needs but instead placed all of their clients into the same investments, essentially acting as mutual fund managers.

The trial concerned the claims of breach of contract, fraud, and breach of fiduciary duty and whether plaintiffs were entitled to out-of-pocket damages (i.e., the money lost), lost profits (i.e., money plaintiffs would have had if their investments had been handled properly), and/or fees for services not performed. Jury selection commenced on April 1, 2019; the trial lasted until April 18, 2019. The jury returned a verdict after less than two days of deliberations, finding for plaintiffs on all counts and awarding over three million dollars to plaintiffs.

Following the trial, by decision and order filed on November 6, 2019, the court upheld liability in all respects but issued a remittitur. The court ordered a new trial on lost profit damages flowing from the cause of action of breach of fiduciary duty unless plaintiffs stipulate to a reduced damages sum. The plaintiffs have instructed that Offit Kurman stipulates to the reduced sum, which with interest will total about $1.5 million. Judgment is expected to be entered after the New Year.

Dick Menaker tried the case. Nathan Henry provided valuable paralegal support throughout the trial.




Dick has been a member of the New York Bar since 1975. He started his career as an associate of Sullivan & Cromwell before co-founding M & H in 1983. Dick concentrates in commercial litigation, dispute resolution, and employment law counseling. He has represented business clients in dozens of cases in federal and state courts around the country at the trial and appellate levels, and in arbitrations and regulatory proceedings.


Offit Kurman is one of the fastest-growing full-service law firms in the United States. With 14 offices in seven states, and the District of Columbia, and growing by 50% in two years through expansions in New York City and Charlotte, North Carolina, Offit Kurman is well-positioned to meet the legal needs of dynamic businesses and the individuals who own and operate them. For over 30 years, we’ve represented privately held companies and families of wealth throughout their business life cycles.

Whatever and wherever your industry, Offit Kurman is the better way to protect your business, preserve your family’s wealth, and resolve your most challenging legal conflicts. At Offit Kurman, we distinguish ourselves by the quality and breadth of our legal services—as well as our unique operational structure, which encourages a culture of collaboration and entrepreneurialism. The same approach that makes our firm attractive to legal practitioners also gives clients access to experienced counsel in every area of the law.

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