11207-11208-11209. TOWN SPORTS INTERNATIONAL, LLC, Plaintiff-Appellant-res, v. AJILON SOLUTIONS, ETC., Defendant-res-res — Becker, Glynn, Muffly, Chassin & Hosinski LLP, New York (Zeb Landsman of counsel), for appellant-res — Smith, Gambrell & Russell, LLP, New York (John G. McCarthy of counsel), for res-res — Judgment, Supreme Court, New York County (O. Peter Sherwood, J., and a jury), entered March 22, 2013, awarding damages to both plaintiff and defendant, and bringing up for review orders, same court and Justice, entered June 11, 2012, which granted defendants motion to dismiss the causes of action for fraudulent inducement, negligent misrepresentation and breach of the implied covenant of good faith and fair dealing, denied plaintiff’s motion for summary judgment on the sixth cause of action for breach of contract, and granted defendant’s cross motion for summary judgment dismissing that cause of action, unanimously modified, on the law, to vacate the award of damages to plaintiff, to deny defendant’s motion to set aside the jury’s verdict on its counterclaim and vacate the damages award to defendant to the extent it is attributable to the counterclaims, and the matter remanded for a new trial on the issue of plaintiff’s damages, and otherwise affirmed, without costs.
Plaintiff, an operator of health and fitness clubs, hired defendant to develop a custom-made computer software system to run its daily operations. Concerned that the project was going over the estimated budget and time schedule, plaintiff refused to pay outstanding invoices of approximately $3 million, whereupon defendant suspended work on the project and refused to turn over its preexisting software, including its source code, which had been licensed to plaintiff as part of the agreement.
