In Matter of the May 1, 1992 Mark Family Trust, a Monmouth County judge has ordered a New York attorney to pay $3.29 million to four plaintiffs after he invested money from their family trusts into his son’s hedge fund without disclosing that they were related.
According to court documents and an attorney involved in the case, Jared Scharf of White Plains, who was trustee for several trusts on behalf of Ann Mark and her three children, Eric, Felicia and Jacqueline, invested $450,000 of their money into an account called BGS Economies of Scale in 2010. Scharf’s son, Adam, also an attorney, albeit with no training or license in trading securities, had started the fund with two friends. Scharf agreed to pay his son’s hedge fund a 2 percent management fee and 20 percent of all profits generated, according to the suit.
The hedge fund gained 14 percent in 2010. In February 2011, Scharf notified the Marks that he intended to invest more of their funds in BGS, and he also told them for the first time in writing that his son was a principal in the fund. The Marks’ total investment in Adam Scharf’s fund rose to $2.2 million, documents said. But the funds suffered significant losses in 2011, after the other two other principals departed, leaving Adam in charge, said Eric Lubin, of Lomurro, Comer, Munson, Brown & Schottland in Freehold, who represented the Mark family.
In May 2013, the Marks instructed Scharf to remove their money from his son’s fund. He refused, and they filed suit later that year. Scharf finally agreed to remove the Marks’ money from his son’s hedge fund in January 2015, 20 months after their first request. A trial judge dismissed the case, finding Scharf did not breach his fiduciary duty, but the Appellate Division reserved in August 2016. Applying New York law, the panel said the motion judge mistakenly interpreted the trusts’ language as containing exculpatory clauses that absolved Scharf of his fiduciary duty of undivided loyalty to the beneficiaries.
On remand, Superior Court Judge Patricial DelBueno Cleary of Monmouth County entered a judgment against Scharf on Nov. 16 for $1.09 million in lost capital, $948,000 in lost profit, $843,000 in lost interest, $99,000 in legal fees, and $312,000 in refunded commissions.
Scharf, who represented himself in the case, did not return a call about the ruling.
— Charles Toutant
$1.2M for Dog Bite in Monmouth
Schuler v. Feigus: A man bitten by a dog while on a call to service a residential HVAC system, necessitating two surgeries, settled his Monmouth County suit on Nov. 10 for $1.2 million.
On Nov. 6, 2015, John Schuler, owner of Holmdel-based Jersey Shore Mechanical, appeared at the Brielle home of Jay Feigus and Monica O’Donnell, said his lawyer, Norman Hobbie of Hobbie, Corrigan & Bertucio in Eatontown.
Feigus opened the back door to allow Schuler in, and the couple’s dog, a mixed breed weighing about 90 pounds, lunged at Schuler, biting him on the right wrist and arm. The wound healed but Schuler developed a neuroma, which required two surgeries, including one to implant surgical hardware, Hobbie said.
Schuler claimed he was out of work several months, and since returning has been limited, requiring him to hire an apprentice and an assistant to perform work he previously did himself.
The parties mediated unsuccessfully earlier in the case and had completed expert discovery when they settled. They differed as to the permanency of Schuler’s injury. The settlement came during mediation with C. Judson Hamlin, a retired Middlesex County Superior Court judge with the Keefe Law Firm in Red Bank.
Michael Dolich of Bennett, Bricklin & Saltzburg in Marlton, who represented the homeowners, confirmed the settlement amount but otherwise declined to comment.
— David Gialanella
$970K in Essex Auto Case
Arasin v. Kumara: In a two-part settlement, a North Arlington man has received $969,504 as compensation for injuries he sustained in an auto accident.
Plaintiff Daniel Arasin, now 41, received two settlements: One from the Drive New Jersey Insurance Co., the carrier for defendant Suliaman Kumara, and another from his own carrier on an underinsured motorist claim, Harleysville Insurance Co., said his attorney, Andrew Statmore.
On Nov. 2, he received $500,000 from Harleysville. In March, he received $469,504 from Drive New Jersey, according to Statmore, of Fredson & Statmore in Clifton. Drive New Jersey already had paid $30,496 to Arete Development Inc., Arasin’s employer and the owner of the car he was driving, Statmore said.
Arasin was injured on Oct. 25, 2013. He was driving westbound on Harrison Avenue in Kearny when his car was struck head-on by a car owned by Kumara and driven by Darius Watford of Hillside, Statmore said. Watford was driving eastbound when he lost control of the car and crossed the center line, Statmore said.
Arasin sustained a mild traumatic brain injury and suffered from post-concussive syndrome, Statmore said. Testing confirmed cognitive deficits, which required therapy, Statmore said.
Arasin also sustained a left knee injury that required arthroscopic surgery, a disc herniation, and an annular tear in his lower back that required therapy and epidural injections, Statmore said.
Arasin continues to suffer from knee pain, back pain, memory problems, irritability, fatigue, apathy, difficulty in concentration and emotional difficulties, Statmore said.
Arasin, a former Marine, led an active lifestyle before his accident, which had now been diminished due to his orthopedic injuries, Statmore said.
The lawsuits had been filed in Essex County.
Harleysville retained Michael Urciuoli of Woodbridge’s Juengling & Urciuoli. He confirmed the portion of Harleysville’s settlement.
William Davis, a Bridgewater solo, represented Kumara. He did not return a call seeking comment.
— Michael Booth