On January 27, 2026, the First Department issued a decision in Carbon Direct Fund II Blocker I LLC v. LanzaTech Global, Inc., 2026 NY Slip Op. 00311, holding that a claim for breach of the implied covenant of good faith and fair dealing based on the same facts, and seeking the same damages, as a breach of contract claim was duplicative and should be dismissed, explaining:
Supreme Court [] properly dismissed the claim for breach of the implied covenant of good faith and fair dealing as duplicative of the breach of contract claim as both claims arise from the same set of facts — namely, defendant’s decision to issue plaintiff common stock instead of convertible preferred stock on the same terms given to the third-party investor — and seek the same damages for the alleged breach. Even if the claim were not duplicative, it nonetheless fails because the covenant of good faith and fair dealing cannot be used to add a new term to a contract, especially to a commercial contract between two sophisticated commercial parties represented by counsel.
(Internal quotations and citations omitted).