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Continental Industries Group, Inc. v. Ustuntas: Revisiting Aiding and Abetting Breach of Fiduciary Duty Claims

Jun 14, 2023Litigation & Dispute Resolution

Aiding and abetting breach of fiduciary duty claims are litigated frequently, and this blog has addressed them here and here. The Appellate Division, First Department, recently opined on aiding-and-abetting liability in Cont. Indus. Group, Inc. v. Ustuntas, 211 A.D.3d 601 (1st Dep’t 2022). As the court’s decision shows, aiding-and-abetting claims are readily susceptible to dismissal, so it is crucial for plaintiffs to allege every required element.

An aiding-and-abetting claim has three elements: (1) someone with fiduciary obligations to someone else breaches those obligations; (2) the defendant—i.e., the “aiding-and-abetting” party—knowingly induces or participates in the breach; and (3) the plaintiff suffers damages as a result of the breach. See Kaufman v. Cohen, 307 A.D.2d 113, 125 (1st Dep’t 2003).

Read the full blog post here.