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FILED: NEW YORK COUNTY CLERK 10/26/2011NYSCEF DOC. NO. 1INDEX NO. 652945/2011 RECEIVED NYSCEF: 10/26/2011SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK -----------------------------------------x BJ 3 REST CORP., P.G.M. RESTAURANT CORP., : JOHN FRASER, ANTOINETTE ALTIERI, and : REBEKAH ALTIERI, : : Plaintiffs, : : -against: : BRUNO V. GIOFFRE, JR., ANTHONY J. DiFIORE, : THE QUINN LAW FIRM, P.L.L.C., GUY T. PARISI, : and LAW OFFICE OF BRUNO V. GIOFFRE, JR., LLC, : : Defendants. : -----------------------------------------x To the above-named defendants:Index No. SUMMONSYOU ARE HEREBY SUMMONED to answer the annexed Complaint in this action and to serve a copy of your answer upon counsel for plaintiffs within 20 days after the service of this Summons, exclusive of the day of service (or within 30 days after service is complete if this Summons is not personally delivered to you within the State of New York) and in case of your failure to answer, judgment will be taken against you by default for the relief demanded in the Complaint. The action will be heard in the Supreme Court of the State of New York, New York County. The basis for venue is that plaintiffs BJ 3 Rest Corp. and P.G.M. Restaurant Corp. both have places of business in New York County. Dated: New York, New York October 26, 2011 SCHWARTZ & PONTERIO, PLLC Attorneys for PlaintiffsBy:___________________________ Matthew F. Schwartz 134 West 29th Street Suite 1006 New York, New York 10001 Telephone: (212) 714-1200SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK -----------------------------------------x BJ 3 REST CORP., P.G.M. RESTAURANT CORP., : JOHN FRASER, ANTOINETTE ALTIERI, and : REBEKAH ALTIERI, : : Plaintiffs, : : -against: : BRUNO V. GIOFFRE, JR., ANTHONY J. DiFIORE, : THE QUINN LAW FIRM, P.L.L.C., GUY T. PARISI, : and LAW OFFICE OF BRUNO V. GIOFFRE, JR., LLC, : : Defendants. : -----------------------------------------xIndex No. COMPLAINTPlaintiffs BJ 3 Rest Corp., P.G.M. Restaurant Corp., Antoinette Altieri, John Fraser, and Rebekah Altieri, as and for their Verified Complaint against defendants Bruno V. Gioffre, Jr., Anthony J. DiFiore, The Quinn Law Firm, PLLC, Guy T. Parisi, and Law Office of Bruno V. Gioffre, Jr., LLC, hereby allege upon personal knowledge and upon information and belief: The Parties 1. Plaintiff BJ3 Rest Corp. (BJ3) is, and at all times relevant to this lawsuit, was, acorporation organized and existing under the laws of the State of New York. 2. Plaintiff P.G.M. Restaurant Corp. (PGM) is, and at all times relevant to thislawsuit, was, a corporation organized and existing under the laws of the State of New York. 3. 4. 5. 6. Plaintiff John Fraser (Fraser) is a resident of the State of New York. Plaintiff Antoinette Altieri (Antoinette) is a resident of the State of New York. Plaintiff Rebekah Altieri (Rebekah) is a resident of the State of New York. Upon information and belief, defendant Bruno V. Gioffre, Jr. (Gioffre) is aresident of the State of New York. 17.At all times relevant to this lawsuit, defendant Gioffre was an attorney admitted topractice law in the State of New York. 8. Upon information and belief, defendant Anthony J. DiFiore (DiFiore) is aresident of the State of New York. 9. At all times relevant to this lawsuit, defendant DiFiore was an attorney admittedto practice law in the State of New York. 10. Upon information and belief, defendant The Quinn Law Firm, PLLC (the Quinnfirm) is a professional limited liability company formed under the laws of the State of New York. 11. Upon information and belief, defendant Guy T. Parisi (Parisi) is a resident ofthe State of New York. 12. At all times relevant to this lawsuit, defendant Parisi was an attorney admitted topractice law in the State of New York. 13. Upon information and belief, defendant Law Office of Bruno V. Gioffre, Jr. (theGioffre firm) is a limited liability company formed under the laws of the State of New York. 14. At all times relevant to this lawsuit, Gioffre was either a member, owner, counselto, or employee of the Gioffre firm and all the actions of defendant Gioffre described in this Complaint were undertaken in such capacity. 15. At all times relevant to this lawsuit, Gioffre, the Gioffre firm, and DiFiore wereeither employed by, members of, counsel to, or otherwise associated with, the Quinn firm and all the actions of defendants Gioffre, the Gioffre firm, and DiFiore described in this Complaint were undertaken in such capacity.2John Frasers Background 16. John Fraser is a premier New York chef. He began in the culinary industryworking as a bartender and line cook while pursuing a degree in Anthropology from the University of California, San Diego. Fraser went on to cook for two notable Los Angeles establishments, Cocco Pazzo and Raffles LErmitage Beverly Hills, rising through the ranks to become sous chef at both locations. 17. In 2000, Fraser moved to Napa Valley to become a chef de partie under ThomasKeller at French Laundry, where he worked for two years. 18. Fraser came to New York in 2003 and established Snack Taverna, an intimateGreek trattoria, with a friend. Two years later, he moved to Compass where he drew critical acclaim, and 2 stars from The New York Times. In 2006, John was named as one of only four young chefs to watch in America, by Esquire magazine which called Compass, the best restaurant on the Upper West Side. 19. Frasers passion and growth as a chef and restaurant owner were realized inDecember, 2007 with the opening of Dovetail in New York. In addition to a slew of accolades, Dovetail has received three stars from The New York Times as well as its first Michelin star in the 2011 New York Guide. Rebekah Altieri 20. Rebekah Altieri has an extensive background in accounting and in the New Yorkrestaurant industry. Beginning in 1992, she oversaw operation of the family-owned restaurant Champs Sport Rock Cafe in Croton, New York. From 1993 to 1995, she worked as a waitress at Spiga in Scarsdale.321.In 1995, she attended The Chubb Institute where she studied accounting andcomputer programming. From 1996 to 1999, she was finance director for White Plains Hyundai White Plains NY and Fuciello Dodge New Rochelle NY 22. From 2002 to present, she has been the owner and operator of R and R TaxService, a small business accounting and tax firm. 23. In 2006, Rebekah purchased an interest in Destino from Eytan Sugarman andJustin Timberlake. Since then, she has operated Destino to excellent reviews. 24. In 2007, she assisted in the build out and grand opening of Justin Timberlakesnew restaurant, Southern Hospitality. In 2008, she reorganized Islero restaurant and was responsible for daily operations of the restaurant. In 2009, she worked on the reorganization of Cain Leisure and took charge of all financial operations for three venues, including The Surf Lodge in Montauk and Gold Bar in New York. What Happens When 25. Fraser, Antoinette, and Rebekah came together to create a new restaurant and theproject developed into What Happens When. Their idea was to create a temporary restaurant installation that was to transform every 30 days into an entirely new restaurant. 26. Plaintiffs found a location for the restaurant on the ground floor of 25 ClevelandPlace, the former home to the restaurant Le Jardin Bistro. Their plan was to have the space for 9 months in a reclaimed space in New York City and change focus with a new movement every month in order to explore what it means to feed people within the traditional constructs of dining, as well as creativity. 27. At the end of the initial nine months, plaintiffs planned to continue the operationby picking one theme for the restaurant, either the most successful monthly movement or a more 4traditional theme, perhaps operating as a steakhouse, for as long as their landlord would allow them to remain in the space. Le Jardin Bistro 28. In November, 2010, plaintiffs found the perfect location for their plannedrestaurant, the space previously occupied by Le Jardin Bistro at 25 Cleveland Place (the Cleveland Place premises). 29. In October, 2010, Gerald Katz (Katz) was the principal owner of PGM whichhad operated Le Jardin Bistro. PGM held the On Premises Liquor License for le Jardin Bistro (License No. 1025134)(the PGM license) issued by the New York State Liquor Authority (NYSLA). A copy of the PGM license is annexed as Exhibit 1. 30. In October, 2010, PGM was losing its lease because the owner of the ClevelandPlace premises intended to redevelop the property. The Cleveland Place premises were therefore available for a short term lease, through the fall of 2011 and on a month to month basis thereafter. 31. In November, 2010, plaintiffs entered negotiations with Katz to purchase PGM,and along with it, the PGM liquor license, and with PGMs landlord, in order to lease the Cleveland Place premises for What Happens When. Retainer of Defendants Gioffre, DiFiore, and The Quinn firm 32. In or around November, 2010, plaintiffs retained Gioffre and the Gioffre firm, intheir capacities as attorneys, to represent and advise them in connection with the creation of What Happens When, and related matters, including the purchase of PGM stock and liquor license, the negotiation and execution of a lease for the Cleveland Place premises, and the corporate change application for the PGM license and all related matters. 533.At that time, Gioffre was limited in his ability to practice before the NYSLAbecause of a prior criminal conviction. Specifically, on or about December 10, 2009, Gioffre pleaded guilty to violating New York State Public Officers Law 73, a Class A misdemeanor. As part of his plea, Gioffre agreed that he would not directly or indirectly appear before the SLA or file any documents or make any submissions to the SLA. 34. Because of this restriction, upon information and belief, Gioffre had affiliatedhimself with or otherwise enlisted DiFiore and the Quinn firm to assist him in matters before then NYSLA and, specifically, in representing plaintiffs in connection with their NYSLA. 35. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm agreed to provide plaintiffswith the legal advice and representation necessary to protect their interests in connection with the creation of What Happens When, and related matters, including the purchase of PGM stock and liquor license, the negotiation and execution of a lease for the Cleveland Place premises, the preparation and filing of a corporate change application with the NYSLA, the application for continued use of the PGM license from the NYSLA and all related filings, the ensuing Article 78 proceeding, and all related matters. 36. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm claimed to have theexperience necessary to handle these matters and, specifically, claimed to have experience in handling liquor license matters. 37. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm agreed to provide plaintiffswith the legal advice and representation necessary to protect their interests in connection with the creation and operation of What Happens When. 38. Initially, Gioffre said the legal fee for all the work, including the filings with theNYSLA, would be a flat fee of $3,500, which plaintiffs paid. A copy of Gioffres e-mail setting 6forth the terms of the retainer agreement is annexed as Exhibit 2. Plaintiffs later paid an additional $2,500. Formation and Structure of BJ3 39. Gioffre was well aware of plaintiffs plans for What Happens When. Plaintiffsexplained their business plan to Gioffre in detail and he understood the important business points of the plan, specifically that the restaurant would only have a short term lease (approximately nine months guaranteed with an offer to continue the lease on a month to month thereafter until the landlord began redeveloping the premises) and that it was therefore essential for plaintiffs to have a liquor license immediately in order to operate successfully. 40. Gioffre further understood that plaintiffs wanted to form a corporation for thepurpose of owning and operating What Happens When and assisted plaintiffs in the formation of that corporation. In fact, defendant Gioffre prepared the certificate of incorporation which was filed with the New York Secretary of State on or about November 24, 2010. A copy of the Certificate of Incorporation is annexed as Exhibit 4. 41. Gioffre was also well aware that the parties intended that the corporation to beformed would be owned by Fraser and Antoinette and that Rebekah would be employed by BJ3 as accountant and business manager for What Happens When. 42. Gioffre represented Antoinette in connection with the preparation, negotiation,and execution of the Shareholder Agreement with Fraser. A copy of the Gioffres e-mail dated November 29, 2010 conveying the Shareholder Agreement is annexed as Exhibit 5. The Cleveland Place Lease 43. Gioffre was well aware that the plaintiffs intended that BJ3 would open andoperate What Happens When at the Cleveland Place premises and that plaintiffs intended to 7undertake extensive renovations at the premises in order to prepare for the operation of their restaurant. 44. In fact, Gioffre had visited the premises with plaintiffs during their planning andhad an opportunity to observe the condition of the premises following the closing of Le Jardin Bistro, which condition is accurately depicted in this photograph:45.Gioffre represented BJ3 in connection with negotiation and execution of a leasefor the Cleveland Place premises, which the parties executed on or about November 24, 2010 for a term commencing December 15, 2010 and ending July 31, 2011 (the Lease). A copy of Gioffres e-mail dated November 19, 2010 regarding the Lease is annexed as Exhibit 6. A copy of the Lease is annexed as Exhibit 7. 46. The Cleveland Place premises are owned by Kenmare Square LLC (thelandlord) which plans to redevelop the property, possibly as a hotel. Because the Lease is short term, plaintiffs were able to negotiate a rent substantially below market. In addition, the 8Landlord made commitment to allow plaintiffs to continue to lease the premises on a month to month basis after the end of the Lease, again at below market rent, so long as it did not interfere with Landlords plan to redevelop the property. PGM was not a party to the Lease. Purchase of PGM Stock 47. Gioffre knew that plaintiffs intended to operate What Happens When with a liquorlicense and that the ability to serve wine and other alcoholic beverages was essential to plaintiffs business plan. In order for plaintiffs business plan to succeed, it was vital that they be permitted to act under the liquor license previously granted to PGM. Indeed, the liquor license was the only PGM asset that had any value. 48. Gioffre was well aware that plaintiffs intended to purchase the stock of PGM sothat they could acquire its liquor license for What Happens When. Gioffre further understood that acquiring an existing liquor license was the only viable way for plaintiffs to proceed with their plan for What Happens When. 49. Had plaintiffs applied for a new license, the process would have been longer andmore uncertain, since it would have required community review. Given the short term availability of the property, plaintiffs only viable option was to acquire the PGM license. 50. Gioffre represented plaintiffs in the negotiation and execution of a PromissoryNote and Sale of Corporate Stock Agreement with Katz, which the parties executed on or about December 8, 2010 (the PGM Stock Agreement). Copies of the Promissory Note and Sale of Corporate Stock Agreement are annexed as Exhibits 8 and 9. 51. Under the terms of the PGM Stock Agreement, plaintiffs agreed to pay Katz$21,000 ($3,000.00 at the time of closing and an $18,000.00 Promissory Note payable in nine months) for 100% of the stock of PGM. In addition, if the restaurant continued to operate after 9the initial nine months, plaintiffs agreed to pay Katz $1,500 per month for each month of operation between ten and twenty one months after closing, and $750.00 per month for each month of operation between twenty two and thirty-three months after closing. 52. The change in ownership of PGM contemplated under the PGM Stock Agreementconstituted a corporate change for which advance NYSLA approval was required. Under Alcoholic Beverage Control Law 99-d(2): Before any corporate change in stockholders, stockholdings, alcoholic beverage officers, officers or directors can be effectuated for the purposes of this chapter, there shall be filed with the liquor authority an application for permission to make such change 53. Gioffre never advised plaintiffs that they were required to obtain NYSLAapproval before the transfer of PGM stock. Nor did he advise them to structure the PGM Stock Agreement such that the transfer would be conditioned upon NYSLA approval of the corporate change. Instead, Gioffre drafted the agreement and allowed his clients to sign the agreement before obtaining NYSLA approval, in direct violation of New York law. 54. Defendant Gioffre also knew that his clients planned renovations for theCleveland Place premises, including the backyard. In fact, he had negotiated a provision in the Lease (Section 99 of the Rider) (Exhibit 7) stating that the landlord could not unreasonably withhold consent to plaintiffs alterations. 55. Gioffre should have realized that, given their intention to make substantialalterations, plaintiffs were required to obtain advance permission from NYSLA. Specifically, under Alcoholic Beverage Control Law 99-d(1): Before any substantial alteration to a licensed premises may be undertaken by or on the behalf of any licensee the licensee shall make an application to the liquor authority for permission to effect such alteration. 1056.Gioffre never advised plaintiffs that NYSLA approval was required for theirplanned renovations. Nor did he advise them to structure the PGM Stock Agreement or Lease such that those agreements would be conditioned on NYSLA approval of the renovations. Instead, Gioffre allowed plaintiffs to proceed with their renovation plans without applying for or obtaining NYSLA approval, in direct violation of New York law. 57. Further, following the purchase of the PGM stock, Rebekah Altieri received thePGM license from Katz and asked Gioffre what steps she should take. Gioffre gave plaintiffs no instructions and never advised plaintiffs that the law required plaintiffs to put the PGM license into safekeeping pending approval of the corporate change application. Instead, Gioffre told Rebekah only that he would be preparing the necessary papers to file with the NYSLA to allow continuation of the PGM license. At no time did he ever advise plaintiffs to place the PGM license in safekeeping as required by law. 58. Plaintiffs followed Gioffres instructions and advice and believed they hadcomplied fully with applicable law. What Happens When Begins Operation 59. Gioffre agreed to continue the representation and continued to advise plaintiffs inconnection with matters relating to the opening of What Happens When. 60. Gioffre was well aware of plaintiffs plans to open the restaurant in January,2011. In fact, on or about January 19, 2011, Gioffre wrote a letter to Empire Merchants, New Yorks leading wine and liquor distributor, a copy of which is annexed as Exhibit 10. In the January 19, 2010 letter, Gioffre wrote: Please be advised that the Law Office of Bruno V. Gioffre, Jr. has been retained to represent PGM Restaurant Corp. in preparing and filing the necessary Corporate Change Application with the New York State Liquor Authority. 1161.Although he knew of their plans to open the restaurant, Gioffre never advisedplaintiffs that they were required to confirm NYSLA approval of the corporate ownership of PGM before beginning their operations or serving alcohol. 62. Plaintiffs spent substantial money and effort to renovate the premises inpreparation for the restaurant opening planned for late January, 2011. Their efforts gained immediate and positive publicity. On January 4, 2011, a lengthy article about the restaurant appeared on the front page of the Dining Out section of the New York Times. A copy of the New York Times article is annexed as Exhibit 11. 63. In late January, plaintiffs believed that they had complied fully with applicablelaw and What Happens When opened for friends and family. The Movements 64. Plaintiffs collaborated with many artistic professionals, including graphic andindustrial designers, interior designers, and composers to design the space. 65. Every month, the restaurant was transformed in a new movement, adopting anew theme, underscored not only by a new menu but also by new dcor, graphic icons, and music. 66. Movement No. 1 was inspired by stark white of winter snow scenes whichplaintiffs incorporated in the restaurants dcor and menu items as depicted in these photographs:1267.During Movement Number 2, the restaurant took on the ambiance of a denseforest reminiscent of Where the Wild Things Are. Plaintiffs installed a large swath of emeraldgreen sticks, representing swaths of oversize pine needles and the menu included themeappropriate dishes like forest mushrooms with salsify, hazelnuts, and barley as depicted in these photographs:68.The idea of blushing provided the theme for a Valentines Day transformation,including a dramatic cloud of colorful fabric overhead as depicted in this photograph:1369.Movement Number 3 was inspired by Renoirs 1881 painting, The Luncheon ofthe Boating Party and the restaurant was transformed, drawing significant elements from the Renoir painting to re-create an intimate, communal experience reminiscent of 19th century France, including a 25 foot interior awning and garden party string lighting, as depicted in these photographs:70.For Movement Number 4, plaintiffs took their inspiration from jazz and the foodof New Orleans. Plaintiffs designer used 9,100 feet of string to create different volumes throughout the space. The entryway welcomed guests with a collage of patterns and imagery that mix old photographs from New Orleans with abstract patterns that visually represent the tempo of jazz. The menu offered the food and flavors of New Orleans, the birthplace of American jazz, including traditional dishes like gumbo and po boys as depicted in these photographs:1471.Each movement built on the success of the last and resulted in new reviews andmore favorable publicity for What Happens When. The restaurants sales grew with each passing month and plaintiffs looked forward to increasing success, particularly during the warm weather months when they would be able to take full advantage of the outdoor space in the rear of the building. NYSLA Investigation 72. The NYSLA began an investigation into What Happens When in early 2011,contemporaneously with the opening. 73. On February 1, 2011, NYSLA agents made a disclosed visit to What HappensWhen and discovered that it had reopened under new owners-operators, but that the required corporate change application had not yet been filed. 74. This constituted the violation of availing under Alcoholic Beverage ControlLaw 111 in that plaintiffs had effectuated a corporate change without the approval of the State Liquor Authority in violation of ABCL 99-d (2). Gioffre did not explain this law to plaintiffs before they began operation. 75. not to worry. The Corporate Change Application 76. Notwithstanding that the Stock Sale Agreement had been executed on December Plaintiffs advised Gioffre of the NYSLA inquiry immediately and he told them8, 2010, Gioffre delayed preparing the corporate change application until two months later. 77. On or about February 2, 2011, nearly two months after his clients had signed thePGM Stock Agreement, a week after they had begun serving alcoholic beverages, and a day after the NYSLA had inquired about the license, Gioffre finally prepared and provided plaintiffs with 15a corporate change application for filing with the NYSLA. Copies of Gioffres February 2, 2010 e-mail and the corporate change application he prepared are annexed as Exhibit 12. 78. Plaintiffs followed Gioffres instructions and Fraser and Katz executed thedocument as prepared by Gioffre. 79. DiFiore submitted the corporate change application to the NYSLA by letter onQuinn firm letterhead dated February 4, 2011. A copy of DiFiores letter of transmittal is annexed as Exhibit 13. The Quinn firms letterhead lists both Gioffre and DiFiore as members of the firm. 80. Not only was the corporate change application untimely, it was incomplete in thatit did not properly disclose BJ3s role in the transaction. For example, Fraser and Antoinette are described on the corporate change application as principals of BJ3, but the application provided no information about BJ3. Moreover, the application did not explain BJ3s role in the transaction, even though BJ3 paid the consideration to Katz for the PGM stock and BJ3 by then had leased the premises under which the NYSLA had granted the license to PGM. BJ3 in effect was an undisclosed corporation funding the proposed transaction. 81. In addition, the corporate change application made no mention of the new tradename for the licensed premises What Happens When and neither Gioffre nor DiFiore ever advised plaintiffs that they were required to obtain NYSLA approval for such a change. 82. The NYSLA never approved the corporate change application and never issued aCorporate Change Endorsement. The Renewal Application 83. The PGM license expired on March 31, 2011.1684.Gioffre, the Gioffre firm, DiFiore, and the Quinn firm agreed to continue therepresentation and continued to advise plaintiffs in connection with license issues. 85. On or about February 8, 2011, Gioffre provided Rebekah with a renewalapplication for the PGM License. Copies of Gioffres e-mail and attached renewal application are annexed as Exhibit 14. 86. Gioffre never advised plaintiffs that the renewal application needed to be signedby Katz since NYSLA had not approved the corporate change and Katz was the authorized signatory for PGM. 87. by Gioffre. 88. Gioffre arranged for the renewal application to be filed with the NYSLA, Plaintiffs followed Gioffres instructions and executed the document as preparedpresumably by defendant Fiore. 89. On March 7, 2011, Gioffre belatedly prepared and provided plaintiffs with anendorsement application seeking to change the trade name on the PGM license to What Happens When. Copies of Gioffres e-mail and attached endorsement application are annexed as Exhibit 15. In his e-mail, Gioffre erroneously instructed plaintiffs to have either Fraser or Antoinette sign the endorsement application, even though Katz was still the only authorized signatory for PGM. 90. Plaintiffs followed Gioffres advice by having Fraser sign the endorsementapplication. It was submitted to the NYSLA on or about March 17, 2011.17The NYSLA Denials 91. The NYSLA declined to endorse the Corporate Change Application. On or aboutApril 21, 2011, the NYSLA issued a letter denying the renewal application. A copy of the Notice of Disapproval of Application issued by NYSLA is annexed as Exhibit 16. 92. In its letter of denial, the NYSLA cited several grounds for its decision: (a) anauthorized person did not sign the renewal application; (b) the licensee allowed persons not approved by the Authority to avail its license; and (c) significant alterations were made to the licensed premises without first obtaining NYSLA approval as required by the Alcoholic Beverage Control Law. 93. In its letter of denial, the SLA also stated that it had declined to act on thecorporate change application because it had not been submitted until after plaintiffs had become aware of the SLAs investigation. Retainer of Parisi 94. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm agreed to continue therepresentation and continued to advise plaintiffs in connection with an Article 78 proceeding by which plaintiffs sought a court order directing NYSLA to grant renewal of the liquor license. 95. Gioffre arranged for plaintiffs to retain defendant Parisi and promised, in an e-mail dated April 1, 2011, to work together with him in the Article 78 proceeding. A copy of Gioffres e-mail is annexed as Exhibit 17. 96. Gioffre, Parisi, and the Quinn firm agreed to continue to provide plaintiffs withthe legal advice and representation necessary in the Article 78 proceeding and in the application for a liquor license from the NYSLA, and all related matters.1897. matters. 98.Gioffre and Parisi claimed to have the experience necessary to handle theseGioffre and Parisi told plaintiffs that they had a strong case, that they had donenothing wrong, and that they would prevail in court. 99. Plaintiffs entered a retainer agreement with Parisi and paid him $10,000 for thework relating to the Article 78 proceeding. A copy of the retainer agreement is annexed as Exhibit 18. The Article 78 Proceeding 100. 101. Defendants Gioffre and/or Parisi drafted the papers for the Article 78 proceeding. On or about April 11, 2011, Parisi filed an Article 78 proceeding captioned PGMRestaurant Corp. v. New York State Liquor Authority (NY County Index No. 104335/11)(the Article 78 Proceeding). Copies of the Petition and supporting memo of law filed by Parisi are annexed as Exhibits 19-20. 102. NYSLA submitted opposition to plaintiffs petition in the Article 78 Proceeding,copies of which are annexed as Exhibit 21 and 22. 103. 104. Parisi thereafter submitted a reply, a copy of which is annexed as Exhibit 23. Defendants Gioffre and the Quinn firm continued to advise plaintiffs throughoutthe Article 78 Proceeding, notwithstanding that they were not attorney of record. 105. Defendant Gioffre made belated attempts to correct the errors he had made withrespect to licensing issues. For example, on or about April 26, 2011, Gioffre prepared and provided plaintiffs with a Management Agreement by which PGM would retain BJ3 to manage the restaurant in apparent recognition that plaintiffs would be required to have PGM, the licensed19entity, continue to participate in the operation of the restaurant. Copies of Gioffres e-mail and of the draft Management Agreement are annexed as Exhibit 24. 106. Also, on April 26, 2011, Gioffre provided plaintiffs with a certification for Katz tosign to assist in their efforts to maintain the PGM license. Copies of Gioffres e-mail and certification are annexed as Exhibit 25. 107. On or about April 27, 2011, the parties appeared in court for the first hearing inthe Article 78 Proceeding and the attorneys entered negotiations. 108. Upon information and belief, NYSLAs attorneys indicated that the NYSLAwould be willing to settle the matter if plaintiffs would simply submit a proper renewal application signed by Katz. Such a settlement would have allowed plaintiffs to continue to operate their restaurant with a liquor license as planned. 109. Upon information and belief, the hearing was adjourned to allow plaintiffs theopportunity to obtain Katzs signature on the application. 110. On or about May 4, 2011, plaintiffs appeared in court for the continued hearing ontheir petition in the Article 78 Proceeding. 111. Upon information and belief, NYSLA was still willing to settle the case, providedthat plaintiffs submitted a proper application executed by Katz. Katz had agreed to cooperate with plaintiffs efforts to maintain the PGM license and had agreed to sign any papers necessary for plaintiffs to continue operating the restaurant with the PGM license. 112. Katz was available in court on May 4, 2011 and would have signed any papersnecessary for plaintiffs to continue operating their restaurant with the PGM license. 113. Gioffre and Parisi failed to communicate this offer to plaintiffs and instead causedthe petition to be submitted to the court for decision. 20114.On or about May 10, 2011, the court issued a decision and order denyingplaintiffs petition in the Article 78 Proceeding, as copy of which is annexed as Exhibit 26. In doing so, the court ruled as follows: The petitioner, although represented by an attorney when filing the applications, waited approximately two months before filing the Corporate Change application with the respondent. The transfer of shares took place on December 8, 2010 and the Corporate Change application was filed February 4, 2011. Antoinette Altieri and John Fraser used the petitioner's liquor license before February 4, 2011, as indicated by the January invoices, even though they were required to notify the respondent before the transfer of shares on December 8, 2010. There was no notification by the petitioner of the planned renovations or alterations to the premises until the renewal inspection. The petitioner has not sufficiently established the need for a hearing or that the respondent's determinations were arbitrary and capricious. (emphasis added) 115. As a result of the foregoing, plaintiffs lost the liquor license for What HappensWhen and were forced to cease operations. Damages 116. license. 117. Plaintiffs were able to operate What Happens When only from on or about Plaintiffs have sustained substantial damages as a result of the loss of their liquorFebruary 1, 2011 through May 23, 2011. 118. During this time, plaintiffs received great reviews and publicity. What HappensWhen was featured prominently and favorably in reviews published in many publications. Copies of some of these articles are annexed as Exhibits 7, 27, 28, and 29. 119. During the period of operation, What Happens When enjoyed great financialsuccess and its revenues and profits increased every month. 120. As a result of defendants malpractice as described above, plaintiffs lost theirability to continue operating What Happens When for the remainder of the Lease. During the 21upcoming summer months, plaintiffs anticipated increasing their revenues substantially because they would have been able to use the outdoor space in the rear of the Cleveland Place premises. Plaintiffs lost substantial profits for the time period remaining on the Lease. 121. In addition to the lost term of the Lease, the Landlord was willing to extendplaintiffs occupancy on a month to month basis continuing after the expiration of the Lease until such time as Landlord was able to proceed with its plans to redevelop the Cleveland Place premises. Plaintiffs therefore claim lost profits for this period as well for as long as the landlord would have allowed plaintiffs to lease the space. 122. In addition, plaintiffs suffered damages for: (a) the expenses incurred for rent($8,000 per month) for the balance of the Lease after they were required to cease operating the restaurant; (b) for food, beverages, and supplies on hand at the time they were required to cease operating the restaurant; (c) legal fees and other expenses incurred after the dismissal of their petition in the Article 78 proceeding in an effort to have the PGM license reinstated; (d) the $18,000 paid the for the PGM stock; and (e) other expenses. First Cause Of Action (Against Gioffre, the Gioffre firm, DiFiore, and the Quinn firm for Legal Malpractice) 123. Plaintiffs repeat and reiterate each and every allegation set forth above as thoughfully set forth herein. 124. Plaintiffs retained Gioffre, the Gioffre firm, DiFiore, and the Quinn firm to advisethem with respect to all matters relating to establishing the restaurant What Happens When, including their acquisition of and application for a liquor license and the preparation and filing of a corporate change application with NYSLA. 125. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm acted as plaintiffs attorneybeginning in November, 2010 and on a continuous basis thereafter through May 10, 2011. 22126.Plaintiffs had an attorney-client relationship with Gioffre, the Gioffre firm,DiFiore, and the Quinn firm. Each of these defendants owed plaintiffs a non-delegable duty and the limitations of CPLR Article 16 are inapplicable. 127. As attorneys for plaintiffs, Gioffre, the Gioffre firm, DiFiore, and the Quinn firmowed them a duty to render legal services in a competent and professional manner and to act with ordinary and reasonable skill, care, and diligence. 128. Gioffre, the Gioffre firm, DiFiore, and the Quinn firm acted negligently under thecircumstances, failed to provide adequate legal services to plaintiffs in accordance with generally accepted standards of the legal profession, and failed to act with ordinary and reasonable skill, care, and diligence. 129. The negligence of defendants Gioffre, the Gioffre firm, DiFiore, and the Quinnfirm consisted of, among other things, failing to advise plaintiffs properly concerning the PGM Stock Agreement; failing to make the PGM Stock Agreement and stock transfer contingent upon NYSLA approval of the corporate change application; failing to advise plaintiffs not to begin operation of the restaurant until NYSLA approved the corporate change application; failing to submit a timely corporate change application; failing to submit a proper corporate change application; failing to submit a proper renewal application; failing to advise plaintiffs concerning the ABC Law provisions applicable to their proposed operation; failing to submit sufficient evidence in the Article 78 Proceeding; failing to advise plaintiffs of the NYSLAs offer to settle the Article 78 Proceeding; failing to know and/or research applicable law; and failing to advise plaintiffs properly.23130.Plaintiffs would have operated What Happens When for at least 9 months with avalid NYSLA liquor license and would not have lost their liquor license but for the negligence of defendants Gioffre, the Gioffre firm, DiFiore, and the Quinn firm as described above. 131. The breaches of duty of defendants Gioffre, the Gioffre firm, DiFiore, and theQuinn firm described above constitute negligence and legal malpractice which have proximately resulted in substantial damage to plaintiffs in an amount in excess of One Million Dollars ($1,000,000). 132. 133. Plaintiffs are also entitled to the return of all fees paid to defendants. By reason of the foregoing negligence of the Gioffre, the Gioffre firm, DiFiore,and the Quinn firm, plaintiffs have been damaged in an amount to be determined at trial, but in no event less than $1,000,000. Second Cause of Action (Against Parisi for Legal Malpractice) 134. Plaintiffs repeat and reiterate each and every allegation set forth above as thoughfully set forth herein. 135. Plaintiffs retained Parisi to advise them with respect to all matters relating toestablishing the restaurant What Happens When, including their acquisition of and application for a liquor license. 136. Parisi acted as plaintiffs attorney beginning in April, 2011 and on a continuousbasis thereafter through h May 10, 2011. 137. Plaintiffs had an attorney-client relationship with Parisi and he owed plaintiffs anon-delegable duty and the limitations of CPLR Article 16 are inapplicable.24138.As attorney for plaintiffs, Parisi owed them a duty to render legal services in acompetent and professional manner and to act with ordinary and reasonable skill, care, and diligence. 139. Parisi acted negligently under the circumstances, failed to provide adequate legalservices to plaintiffs in accordance with generally accepted standards of the legal profession, and failed to act with ordinary and reasonable skill, care, and diligence. 140. The negligence of Parisi consisted of, among other things, failing to adviseplaintiffs properly; failing to submit sufficient evidence in the Article 78 Proceeding; failing to advise plaintiffs of the NYSLAs offer to settle the Article 78 Proceeding; failing to know and/or research applicable law; and failing to advise plaintiffs properly. 141. Plaintiffs would have operated What Happens When for at least 9 months with aliquor license and would not have lost their liquor license but for defendant Parisis negligence as described above. 142. Defendant Parisis breaches of duty constitute negligence and legal malpracticewhich have proximately resulted in substantial damage to plaintiffs in an amount in excess of One Million Dollars ($1,000,000). 143. 144. Plaintiffs are also entitled to the return of all fees paid to Parisi. By reason of the foregoing negligence of Parisi, plaintiffs have been damaged inan amount to be determined at trial, but in no event less than $1,000,000.25WHEREFORE, plaintiffs BJ 3 Rest Corp., P.G.M. Restaurant Corp., Antoinette Altieri, John Fraser, and Rebekah Altieri, by their attorneys Schwartz & Ponterio, PLLC, request that judgment be entered against defendants Bruno V. Gioffre, Jr., Anthony J. DiFiore, The Quinn Law Firm, PLLC, Guy T. Parisi, and Law Office of Bruno V. Gioffre, Jr., LLC, jointly and severally, awarding compensatory damages in an amount to be determined, but in any event not less than $1 million for each cause of action, plus prejudgment interest, at the legal rate, from May 10, 2011, and awarding plaintiffs attorneys fees, and the costs and disbursements of this action, together with such other and further relief as the Court deems just and proper. Dated: New York, New York October 26, 2011 SCHWARTZ & PONTERIO, PLLC Attorneys for PlaintiffsBy:___________________________ Matthew F. Schwartz 134 West 29th Street Suite 1006 New York, New York 10001 Telephone: (212) 714-120026

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