EMA Financial LLC v. Joey New York Inc.

OPINION & ORDER   Plaintiff EMA Financial, LLC (“Plaintiff”) brings this action against Defendants Joey New York, Inc. (“Joey New York”), RAR Beauty, LLC (“RAR”), LABB, Inc. (“LABB”), Reflex Productions, Inc. (“Reflex”), and Joey Chancis (collectively, “Defendants”), asserting causes of action for specific performance, a permanent injunction, breach of contract, and fraud arising from the conduct of Defendants in connection with certain agreements to purchase securities and related convertible note agreements. Defendants bring a counterclaim against Plaintiff for fraudulent inducement. Before me are: (1) Plaintiff’s motion for partial summary judgment as to the causes of action for breach of contract, breach of guaranty, and attorneys’ fees and costs; and (2) Plaintiff’s motion to dismiss Defendants’ counterclaim and affirmative defenses. Because the agreements entered by the parties were not usurious, Plaintiff’s motion for summary judgment is GRANTED as to liability on the second, fourth, and sixth claims for relief. Because Defendants did not plead their counterclaim with sufficient particularity, Plaintiff’s motion to dismiss the counterclaim is GRANTED. Plaintiff’s motion to dismiss the affirmative defenses is DENIED as premature. I. Background Plaintiff and Defendant Joey New York entered into Securities Purchase Agreements on February 1, 2017 (the “First SPA”) and on May 3, 2017 (the “Second SPA”). (Defs.’ 56.1

1, 7.)¹ These transactions were executed to provide Defendant Joey New York and its CEO, Joey Chancis, with the necessary capital to expand their in-store Botox and beauty treatment business in Florida. (Id. 3.) The First SPA provided for the purchase of a Convertible Redeemable Promisory Note from Joey New York to Plaintiff for $90,000 (the “First Note”), (id. 1), and the Second SPA provided for the purchase of a Convertible Redeemable Promisory Note from Joey New York to Plaintiff for $151,600 (the “Second Note”), (id. 7).² Both the First SPA and the Second SPA contained an unconditional and unlimited guaranty whereby Defendants RAR, LABB, and Reflex agree to guarantee the payment and performance on the First and Second Notes, respectively. (Id.