The following e-filed documents, listed by NYSCEF document number (Motion 005) 113, 114, 115, 116, 117, 118, 119, 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, 130, 156, 185, 186, 187, 188, 189, 190, 191, 192, 193, 194, 195, 196, 197, 198, 199, 200, 201, 202, 203, 204, 205, 206, 207, 208, 209, 210, 211, 213, 214, 217, 219, 225, 226, 227, 228, 229, 230, 231, 232, 233, 234, 235, 236, 237, 238, 253 were read on this motion for PARTIAL SUMMARY JUDGMENT/CROSS-MOTION TO DISMISS, OR IN THE ALTERNATIVE, FOR PARTIAL SUMMARY JUDGMENT. The following e-filed documents, listed by NYSCEF document number (Motion 006) 132, 133, 134, 135, 136, 137, 138, 139, 140, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151, 152, 153, 154, 155, 157, 158, 159, 160, 161, 162, 163, 164, 165, 166, 167, 168, 169, 170, 171, 172, 173, 174, 175, 176, 177, 178, 179, 180, 181, 182, 183, 184, 212, 215, 216, 218, 224, 239, 240, 241, 242, 243, 244, 245, 246, 247, 248, 249, 250, 251, 252, 254 were read on this motion for PARTIAL SUMMARY JUDGMENT/CROSS-MOTION TO DISMISS, OR IN THE ALTERNATIVE, FOR PARTIAL SUMMARY JUDGMENT. DECISION + ORDER ON MOTION This case arises out of a series of agreements formed to purchase and develop properties located at 192 8th Avenue, New York, NY; 238-240 East 3rd Street, New York, NY; and 128 West 26th Street, New York, NY (see NYSCEF 212-13). In this motion, Defendants and Counterclaim and Crossclaim Plaintiffs RI 128 26th Street LLC (“RI 26″), RI 192 8th Avenue LLC (“RI 8″), and RI 238-240 East 3rd Street, LLC (“RI E3″) (collectively, the “Members”) seek partial summary judgment on their First Counterclaim for breach of the LLC Agreements of 192 8th Avenue Realty Group LLC (“8th Ave. Realty”), E3 Street Realty LLC (“E3 Street Realty”), and 128 West 26th Street Development LLC (“West 26th Street”) (collectively, the “Development Companies”) and on their Third Counterclaim for a declaration that Plaintiffs and Counterclaim Defendants D&V Realty LLC and CIP1 LLC (collectively, the “Managers”) were properly removed as managers of the Development Companies. The Managers cross-move to dismiss the counterclaims or, in the alternative, seek partial summary judgment on their Fifth Cause of Action for a declaration that the Managers’ removal was improper (NYSCEF 213-213). As the Managers’ cross-motion implicates threshold issues such as standing, the Court will consider the cross-motion first. For the following reasons, the Managers’ cross-motion is granted in part, and the Members’ motion is granted in part.1 a. Plaintiffs’ Cross-Motion to Dismiss, or in the Alternative, for Partial Summary Judgment A motion to dismiss a counterclaim is evaluated under the same standard as a motion to dismiss a complaint (see McRedmond v. Sutton Place Restaurant and Bar, Inc., 48 AD3d 258, 258 [1st Dept 2008]). Accordingly, the Court must “accept the facts as alleged in the [counterclaim] as true, accord [counterclaim] plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” (Leon v. Martinez, 84 NY2d 83, 87-88 [1994]). Where the motion is based upon an “alleged lack of standing, the burden is on the moving [party] to establish, prima facie, the [counterclaim] plaintiff’s lack of standing as a matter of law” (Arch Bay Holdings, LLC-Series 2010B v. Smith, 136 AD3d 719, 719 [2d Dept 2016]). “To defeat the motion, a [counterclaim] plaintiff must submit evidence which raises a question of fact as to its standing” (id.). Here, the relevant LLC Agreements provide that the validity, construction and interpretation of the agreements and all questions arising out of or concerning the companies or the agreements “are to be governed by the Laws of the State of Delaware” (NYSCEF 4 at 40; NYSCEF 136 at 40-41; NYSCEF 137 at 40-41). Delaware Courts have taken a similar approach on the issue of standing (see Omnicare, Inc v. NCS Healthcare, 809 A2d 1163, 1168 [Del Ch 2002] [holding "standing to maintain a lawsuit refers to the right of a party to invoke the jurisdiction of a court to enforce a claim or redress a grievance'" and "[i]n deciding whether a party has standing to bring a claim, the court shall ‘consider[] who is entitled to bring a lawsuit rather than the merits of the particular controversy’”] [internal citations omitted]). The Managers advance two arguments in support of their position that the Members lack standing. First, the Managers argue that because the Members were sanctioned by OFAC they must first seek a license to maintain this action (see NYSCEF 212, 213). However, “a Treasury Department authorization or license is not a prerequisite to initiating an in personam lawsuit. The Assets Control Regulations forbid only those judicial acts that transfer a property interest” (Dean Witter Reynolds, Inc. v. Fernandez, 741 F2d 355, 361-62 [11th Cir 1984]). Here, the First, Fourth, Sixth, and Seventh Counterclaims seek money damages (NYSCEF 42 149). Therefore, “it [is] not until after judgment that a transfer of property [would become] possible” (Dean Witter, 741 F2d at 362). In that event, “all subsequent proceedings to enforce the judgement [would have to] be licensed” (id.; see also American Bank and Trust Co. v. Bond Intern. Ltd., 464 F Supp2d 1123, 1128 [ND Okla 2006] [holding the failure to obtain a license does not "deprive [the court] of jurisdiction to review plaintiff’s security interests in property leased…but the court has no authority to issue a transfer of (including appointment of a receiver for) property rights…without evidence that plaintiff has obtained a license from OFAC to maintain such security interests”]). With respect to the Second and Fifth Counterclaims, for Specific Performance and an Accounting, respectively, the Members seek to enforce rights and obligations contemplated under the Operating Agreements as a result of the Managers’ alleged breaches, which occurred prior to any sanctions (NYSCEF 42 14). These alleged breaches are likewise foundational to the Third Counterclaim for a declaratory judgment that the Managers’ removal was proper. Therefore, the Members may assert, and this Court may adjudicate, claims regarding whether the Members are entitled to the relief they seek (see e.g., American Airways Charters, Inc. v. Regan, 746 F2d 865, 869 [D DC 1984] [permitting a sanctioned entity to hire counsel and maintain a lawsuit, noting that while assets may not be touched without OFAC's permission, "Congress has not authorized the Executive to seize the corporation [and] control all its internal operations”]). In any event, the Managers seek a judgment declaring that the removals were improper (NYSCEF 1
109-116) and thus themselves put the propriety of the removals at issue before the Court. Accordingly, the OFAC sanctions do not bar the Members’ from asserting the Counterclaims.2 Second, the Managers argue that the Members do not have standing to assert claims in their individual capacity rather than as derivative claims in the name of the Development Companies (see NYSCEF 212 at 10, 213 at 11). This argument is correct as to some counterclaims, but not as to others. Specifically, the Second and Fifth Counterclaims seek enforcement of the Members’ alleged individual rights to require the Managers to produce or otherwise make documents available for inspection (NYSCEF 42
