Case Reflection Vol. 4 (7/28/26):
The Appeal That Never Had to Happen: Vacating a Six-Figure Judgment on Re-argument
By: Israel A. Katz, Partner, Litigation Department
The Facts: Not every litigation victory comes from proving your client was right. Sometimes it comes from proving that, even accepting the court’s prior findings, the remedy imposed cannot stand.
Our client, a commercial brokerage firm, became embroiled in litigation arising from the sale of a Queens commercial property for $4.8 million. Defendants alleged that our client failed to disclose an earlier $5 million offer that contemplated a separate $200,000 buyer-side commission arrangement. Based on those allegations, the court granted summary judgment on fraud and breach of fiduciary duty counterclaims, held that our client forfeited its commission, and awarded defendants an additional $200,000 in damages. A judgment was subsequently entered against our client.
By the time our firm was retained, liability had already been determined and judgment had already been entered. Most litigants would have viewed the case as heading straight to the Appellate Division.
We saw something else.
The Strategy: Rather than attempting to relitigate every issue decided on summary judgment, we focused on a single question:
What actual damages did defendants suffer?
The prior decision awarded defendants $200,000 based on the difference between the buyer’s initial $5 million proposal and the ultimate $4.8 million sale price. But that analysis overlooked a critical economic reality.
Had the transaction closed at $5 million, defendants still would have owed our client a 4% commission of $200,000, leaving them with net proceeds of $4.8 million. Under the transaction that actually occurred, defendants received $4.8 million and, because the court had already ruled that our client forfeited its commission, paid no commission at all. Their net recovery was exactly the same in either scenario. In other words, even assuming every finding against our client was correct, defendants suffered no actual pecuniary loss.
Our re-argument motion therefore narrowed the dispute to a single dispositive issue: New York damages law permits compensation for actual losses, not economic windfalls. We argued that the $200,000 award left defendants in a better position than they would have occupied absent the alleged misconduct, a result New York law does not permit.
The Outcome: In an exceedingly rare reversal on re-argument, the court agreed. The court held that it had “overlooked and misapprehended controlling principles of New York damages law” and concluded that defendants’ economic position was identical with or without the alleged misconduct. Because defendants suffered no actual pecuniary loss, the court determined that the $200,000 award improperly conferred a windfall. The court granted re-argument, vacated the $200,000 damages award, and vacated the resulting judgment entered against our client. The case then quickly settled.
For any litigator, obtaining a reversal on re-argument is difficult. Courts are understandably reluctant to revisit their own decisions, and re-argument is not an opportunity to recycle previously rejected positions. It requires demonstrating that the court overlooked or misapprehended controlling facts or law. Here, a focused presentation of a single dispositive issue convinced the court that its prior ruling produced an impermissible result under settled New York law.
The Takeaway: This case serves as an important reminder that effective appellate and post-decision advocacy is often about discipline, not volume. When pursuing re-argument, there is a natural temptation to challenge every adverse ruling and reassert every available argument. That approach is frequently counterproductive. Re-argument requires the advocate to identify the error that matters most and present it in a manner that makes correction unavoidable.
Here, rather than attempting to relitigate every aspect of the underlying liability findings, we honed in on one issue: damages. By hammering home the absence of actual pecuniary loss and the impermissible windfall created by the prior award, we presented the Court with a straightforward question of economic reality and settled New York law. That focused approach carried the day. This case demonstrates the power of that approach. A targeted re-argument motion transformed an adverse judgment into a post-judgment victory for our client without the need to appeal. In a procedural context where reversals on re-argument are exceptionally rare, focusing on the best argument, and making it impossible to ignore, proved decisive.
Israel A. Katz is a Partner in the Firm’s Litigation Department concentrating in complex commercial real estate litigation matters, including brokerage and contract disputes discussed in this article.
Israel can be reached at 212-867-4466 (Ext. 824) or ikatz@bbgllp.com.
