On October 8, 2025, Justice Masley of the New York County Commercial Division issued a decision in Vinci Brands LLC v. Case-Mate, Inc., 2025 NY Slip Op. 33855(U), holding that allegations of protest and economic duress were sufficient to defeat a motion to dismiss based on the voluntary payment doctrine, explaining:
Case-Mate also argues that the voluntary payment doctrine bars Vinci’s breach of contract claim. Finding that the facts alleged in Vinci’s amended complaint are sufficient to support a finding of payments made under protest and under duress, the court declines, at this stage, to dismiss the claim pursuant to the voluntary payment doctrine.
The voluntary payment doctrine bars recovery of payments voluntarily made with full knowledge of the facts, and in the absence of fraud or mistake of material fact or law.. Generally, the onus is on a party that receives what it perceives as an improper demand for money to ‘take its position at the time of the demand, and litigate the issue before, rather than after, payment is made. However, where there is evidence that plaintiff made the payment under economic duress or under protest, the doctrine does not bar recovery.
A plaintiff must allege facts sufficient to show that it protested defendant’s demand for a disputed payment. The complaint should set forth details such as the medium of communication, to whom the protest was made and the nature of the protest. A protest is effective as such only if it puts the other party on notice that the protesting party is reserving its right to later dispute the payment.
Payment is made under economic duress when a party is compelled to agree to terms set by another party because of a wrongful threat by the other party that prevents it from exercising its free will. A threatened loss of property could be the basis of an economic duress finding. Similarly, economic duress is established when the facts show that a contractual breach will result in an irreparable injury or harm.
Here, Vinci alleges that, on May 23, 2023, Case-Mate notified Vinci of its intent to initiate a UCC Article 9 foreclosure sale of Vinci’s assets. To avoid such foreclosure, Vinci sought out third-party funding to pay off the loan. Case-Mate stated its intention to include in the final payoff amount the Case-Mate Fees. Vinci alleges it objected. Vinci further alleges that, in an email to Case-Mate’s counsel, sent on May 30, 2023, Vinci’s counsel objected to the inclusion of the $600,000 Assignment Fee. In the email, Vinci allegedly stated that the loan documents do not require Borrower to pay an Assignment Fee so please remove that item from the ‘Payoff Amount. Nevertheless, to preserve its business and avert the intended foreclosure sale on June 5, 2023, Vinci paid off the loan, including the Case-Mate Fees, on June 5, 2023.
Vinci alleges facts sufficient at this stage to survive a motion to dismiss. It is enough that Vinci alleges that it made the $600,000 Assignment Fee payment under protest; such protest was sufficient to put Case-Mate on notice that Vinci objected to the payoff amount. Additionally, as to the remaining Case-Mate Fees, Vinci’s allegation that it made these payments under economic duress to avoid the threatened UCC Article 9 foreclosure sale, which would have destroyed Vinci, is sufficient.
(Internal quotations and citations omitted).