On September 21, 2023, the First Department issued a decision in 47 E. 34th St. (NY) L.P. v. BridgeStreet Worldwide, Inc., 2023 NY Slip Op. 04702, holding that a claim based on successor liability failed for lack of evidence that the defendant purchased the assets of the predecessor company, explaining:
Generally, a corporation which acquires the assets of another is not liable for the torts of its predecessor. There are limited exceptions to this general rule, including the mere continuation theory at issue here, which case law provides can only be asserted against a single corporation.
A successor liability claim cannot stand where the surviving corporation did not acquire the assets of the selling corporation. Neither defendant herein acquired BWW’s assets. The documentary evidence, including the CTA, the ATA, and the Stock Power — none of which plaintiff claims are fabricated — demonstrate that Domus Funding transferred BWW’s domestic collateral to nonparty Domus Group and BWW’s foreign collateral to nonparty Domus UK. For its part, Versa was not even a signatory to any of the relevant transactions.
(Internal quotations and citations omitted).