A Manhattan commercial and business law firm's action against a former client it says told it an "egregious lie" connected to legal fees has been revived by a state appeals court, which has largely reversed the lower court's dismissal of the action.

Scarola Zubatov Schaffzin's Supreme Court suit based on alleged fraudulent inducement committed by former client Dynamic Credit Partners and its principal, James Finkel, will go forward after the Appellate Division, First Department ruled that "summary judgment should not have been granted to defendants," and that "contrary to the [lower] court's finding, plaintiff could show reliance in support of its fraud cause of action."