On June 2, 2026, the First Department entered a decision in Eastern Effects, Inc. v. 3911 Lemmon Ave. Assoc., LLC, 2026 NY Slip Op. 03386, holding that a fraud counterclaim was barred by an agreement’s no representation clause, explaining:
[P]laintiffs, defendants, and several additional nonparty entities entered into a settlement agreement and release. Under the settlement agreement, defendants agreed to compensate plaintiff for monthly rent, real estate taxes, common area maintenance fees, utilities, and lost business, and to make reasonable repairs to the leased space before returning it to plaintiff’s possession. The parties further agreed that the settlement agreement “contain[ed] the entire understanding among the Parties and supersedes any prior written or oral agreements between them, respecting the subject matter of this Agreement,” and that “[e]xcept as otherwise expressly provided in this Agreement, there are no representations, agreements, arrangements, or understandings, oral or written, between the Parties relating to the subject matter of this Agreement that are not fully set forth herein.”
. . .
The proposed fraud counterclaim, which was based on plaintiff’s allegedly false statements that were intended to induce defendants into entering into the settlement agreement, was barred by the “no representations” clause in the agreement. Plaintiff’s statements were unquestionably related to the subject matter of that agreement, which addressed plaintiff’s purported inability to conduct work at the leased premises and plaintiff’s losses should it be excluded from the premises.
(Internal citations omitted).