DECISION + ORDER ON MOTION Defendant PMAW Hair Styling, Ltd. (“PMAW”) is presently the lessee of a barbershop located at 1034A Lexington Avenue, New York, New York (the “Premises”). Defendant Adrian Wood is the decades-long principal barber and operator of barbershops bearing the trade name Paul Mole Barbershop (“Paul Mole”), an iconic trade name on the Upper East Side of New York City. Mr. Wood entered into an agreement with Susan Rooney, a former lover, pursuant to which Ms. Rooney, operating under the name P.M.W.A. Hair Stylist Inc. (“PMWA”), would manage the day-to-day operations of the barbershop. Exhibit A-1. After the relationship between Ms. Rooney and Mr. Wood soured for, inter alia, the reasons stated infra, the Paul Mole franchise grievously suffered and the former lovers have engaged in a litigation war of attrition with each other in multiple fora. On September 16, 2022, the Court held a remote evidentiary hearing via Microsoft Teams with counsel for all parties on defendants’ application for a preliminary injunction seeking to enjoin plaintiffs from: (1) withholding from defendant Adrian Wood a copy of keys to the Paul Mole Barber Shop; (2) denying defendant Wood full access to the Premises; (3) failing to reinstate or grant defendant Wood full access and signatory power for each bank account belonging to plaintiff PMWA; (4) withdrawing money using a check from any account belonging to PMWA unless signed by both defendant Wood and plaintiff Susan Rooney, with the exception of payments for rent, water and taxes owed with respect to the Premises, corporate taxes, payroll payments to plaintiff P.M.W.A. Hair employees that are consistent with legitimate prior payments, and payments for supplies and equipment consistent with prior payments; (5) withholding payment toward rent arrears and other payments owed to the barbershop’s landlord; and (6) removing or allowing the removal of any of the personal property of the barbershop. The Court reviewed voluminous documents and direct testimony affidavits prior to the hearing. At the hearing, affiants Susan Rooney, Adrian Wood, Elizabeth Stuckler, Kevin Gallagher, and Vivien T. LeGunn appeared for cross-examination. The Court found the testimony of plaintiff Rooney to be evasive and lacking in credibility. The Court found the other witnesses credible. Counsel waived the right to cross-examine any of the other witnesses who submitted direct testimony affidavits. Based on the documentary evidence and the testimony adduced during the proceedings of September 16, 2022, defendants have successfully demonstrated a likelihood of success on the merits for all prongs of the preliminary injunctive relief sought. With respect to prongs 1 and 2 of defendants’ application seeking to enjoin plaintiffs from denying defendant Wood a copy of the keys to the Premises and from denying Wood full access to the Premises, defendants have demonstrated that the Lease of Premises is between the landlord and defendant PMAW, defendant Adrian Wood’s company. Exhibit F-6. The lease was also personally guaranteed by defendant Wood. Exhibit F-6. This was corroborated by the testimony of Vivien T. LeGunn, the Premise’s landlord. Plaintiffs proffered no evidence that the lease or that defendant corporation PMAW was ever transferred to plaintiff corporation PMWA, a corporate entity separate from the corporate defendant PMAW. Thus, neither plaintiff PMWA nor plaintiff Rooney have any power to prevent defendant Wood from accessing the Premises his corporation leased, the payment for which he personally guaranteed. Defendant offered evidence through the testimony of Mr. Kevin Gallagher, a retired New York City Police Department Detective Investigator 2nd Grade with experience with the NYPD Intelligence Bureau including work involving surveillance and surveillance equipment. Mr. Gallagher testified that, on August 18, 2022 and August 22, 2022, he accompanied defendant Wood to the Premises to obtain keys to the premises pursuant to the Temporary Restraining Order issued by the Court on August 9, 2022. Mr. Gallagher further testified credibly that: [On the August 18, 2022 visit to the Premises] Mr. Wood asked for keys to the barbershop and Ms. Rooney stated that she had no time, she needed to get organized, that she had a dentist appointment, and that she did not have time to do this right now. NYSCEF Doc. No. 176. With respect to prong 3 of defendants’ application seeking to enjoin plaintiffs from Failing to reinstate or granting full access and signatory power to Wood for each bank account of plaintiff PMWA, plaintiff Rooney testified that plaintiff corporation PMWA’s bank account with Capital One was first set up when plaintiff corporation was first formed, and that defendant Wood was a signatory to that account at the time the account was established. Plaintiff Rooney further testified that she had defendant Wood removed as signatory from the Capital One bank account at some point after the parties’ relationship had soured. Under all the circumstances and based on all the testimony and evidence presented, the Court finds it appropriate for defendant Wood to have access and signatory power for each bank account belonging to plaintiff PMWA. Prong 4 of defendants’ application seeks to enjoin plaintiffs from withdrawing money using a check from any bank account belonging to plaintiff PMWA unless cosigned by both plaintiff Rooney and defendant Wood, with the exception of payments for rent, water and taxes owed with respect to the Premises, corporate taxes, payroll payments to plaintiff P.M.W.A. Hair employees that are consistent with legitimate prior payments, and payments for supplies and equipment consistent with prior payment. Based on the testimony and evidence before the Court, dual signatures are an appropriate way to proceed pending further order of the Court. With respect to prong 5 of defendants’ application seeking to enjoin plaintiffs from withholding payment towards rent arrears, water bills, and taxes owed by plaintiff to the barbershop’s landlord, defendants have demonstrated that the lease was between defendant corporation and the landlord and personally guaranteed by defendant Wood. It is undisputed that the Premises are being occupied by plaintiff PMWA. Defendant Wood credibly testified, and documentary evidence supports, that plaintiff PMWA was created as defendant PMAW’s agent for the purpose of maintaining the day-to-day operational and financial matters of the barbershop. Further, section 5 of the PMWA Hair Shareholder’s Agreement states: “Until such time as the shareholders shall decide, Rooney shall be entrusted with the duties of the ‘day-today’ management of the corporation and shall be entrusted with the daily financial, and daily operational management of the corporation barbershop business.” Exhibit A-1. It follows, based on the above evidence, that plaintiff Rooney is responsible for ensuring payment of rent. Plaintiff Rooney also testified that the monthly rent is approximately $10 — 11,000.00 per month and that the only rent she paid in 2021 and 2022, totaled approximately $23,000.00. The Premise’s landlord, Vivien T. Gunn, also testified as to the payment of rent: While Ms. Rooney is able to collect money and benefits from the operation of the barber shop, she is doing so at my personal expense (this is the only building that I own, it is my principal source of support, and I have been drained financially and psychologically by her refusal to pay the business’s obligations including rent, as well as their share of N.Y.C. property taxes, water, and sewar [sic] charges. Ms. Rooney’s behavior has been that of a manipulative bully. Apparently, she has believed that she holds all the cards. Previously, she was able to take advantage of me by relying on the pandemic eviction moratorium. She has tried to coerce me perhaps in part due to my senior status, the fact that I am a woman, and the backlog of eviction cases in the courts…. While I shall never lease to a company of which Ms. Rooney is a party, I hope to make new lease arrangements with Mr. Wood and the Paul Mole Barber Shop, but I need to make certain that Ms. Rooney will not be associated with the lessee of the premises. NYSCEF Doc. No. 177. Regarding prong 6 of defendants’ application seeking to enjoin plaintiffs from removing or allowing to remove any of the personal property of the barbershop, defendant Wood credibly testified that the personal property located at the Premises is the personal property of defendant corporation. The list of personal property includes vintage barbershop equipment, as well as art and decor, all of which had been accumulated prior to the formation of plaintiff corporation and prior to plaintiff Rooney’s involvement with the Barbershop. There is no evidence that this personal property was ever transferred to plaintiffs. Defendants have demonstrated they will suffer irreparable harm in the absence of an injunction. The loss of goodwill of a viable, ongoing business has been held to constitute irreparable harm warranting the grant of preliminary injunctive relief. See Advent Software, Inc. v. SEI Global Services, Inc., 195 A.D.3d 498, 499 (1st Dept. 2021). Defendants have demonstrated they will suffer irreparable harm in the form of loss of goodwill, reputation, and client relationships. See Newmark Partners, LP v. Hunt, 160 N.Y.S.3d 23, 24 (1st Dept. 2021) Defendants have further demonstrated that plaintiff Rooney’s conduct may jeopardize defendant Wood’s license as owner/operator of the barbershop and thus may deprive defendant Wood from pursuing his livelihood in a business in which he has been involved for 50 years. Ms. Stuckler, a master barber that has worked with defendant Wood at the Barbershop since 1990, testified credibly that: With Mr. Wood at [the barbershop's] helm, the environment of the barbershop was pleasant, welcoming, and classy. Mr. Wood encouraged friendship among the barbers, made sure that customers were treated well, and he had a loyal following (people repeatedly ask for him. Mr. Wood has a professional, friendly demeanor. He has wanted customers to feel that they were getting the top-notch service and that they were not rushed. Three of the four licensed barbers, Guido Bolanos, Carmine Nappi, and I, have worked together with Mr. Wood for decades (over 30 years for me and Carmine and over 25 years for Guido — the fourth barber is Bajram Dede). Business has faltered since Mr. Wood’s absence in March 2022 and we have lost customers. The atmosphere in the shop is less than welcoming and there is tension due to Mr. Dede being given the majority of walk-in business. Each station is not properly stocked with product such as Barbacide, witch hazel, and styling creme. All too often conditioner is poured into a shampoo dispenser and shampoo is poured into a conditioner dispenser. These problems do not inspire confidence in the customer or a relaxed environment. While Mr. Wood has exercised his authority as owner/operator of the Paul Mole Barber Shop, Ms. Rooney has countermanded his directives or ignored them. As Ms. Rooney admits in her August 11, 2022 Affidavit and is stated by Bajram “benny” Dede in his August 11, 2022 Affidavit, Mr. Dede was fired by Mr. Wood, only to be rehired by Ms. Rooney. Despite his notifications regarding an expired NYS Department of State Appearance Enhancement license and an expired NYC Department of Health license, those licenses remain expired. Mr. Wood is needed for Paul Mole to survive and thrive. NYSCEF Doc. No. 175. Further, affiant Kevin Gallagher credibly testified that, during an August 18, 2022 visit to the barbershop: Mr. Wood noticed a person who he did not recognize sitting in a barber chair, who appeared to be a male Hispanic, age 19-20. When Mr. Wood asked him who he was, he stated he was the receptionist. Mr. Wood asked him why he was sitting in the barber chair and the male answered that Ms. Rooney was doing emails. There was no further discussion with that person. I followed Mr. Wood around the shop. Mr. Wood noticed that a New York State Department of State issued Appearance Enhancement license had lapsed and informed Ms. Rooney that this needed to be updated because without the license only certain services could be performed. Mr. Wood also later informed me that he had previously addressed this issue with Ms. Rooney and her response had been that a renewal license should soon arrive. He also informed me this was important because an employee nicknamed “Leo” could not work if there was no Appearance Enhancement License in effect. Leo was cutting a male minor’s hair (the minor appeared to be about 14 to 16 years old) with no parent present. Mr. Wood said nothing to Leo, who I understand is a cosmetologist and not a barber. Mr. Wood informed Ms. Rooney that no licensed barber was present and that Leo should not be working. Ms. Rooney responded that we were just there to cause trouble. At no time did Mr. Wood act in a manner that was inappropriate, discourteous, or hostile. As we were about to leave, Mr. Wood stated to Ms. Rooney that we need to make an appointment at the bank so that Mr. Wood could be added to the accounts. Ms. Rooney responded that she has no time for this and her lawyer will speak to his lawyer. NYSCEF Doc. No. 176 The evidence suggesting the loss of barbershop customers and that the barbershop has continued operating despite the expiration of certain licenses related to the operation of the barbershop demonstrates that plaintiffs are causing irreparable harm to the Paul Mole franchise. Based on the testimony and evidence submitted and for the reasons stated above, defendants have satisfactorily demonstrated a likelihood of success on the merits, irreparable harm, and that the balance of the equities tips decidedly in defendants’ favor. Defendants must post a $75,000.00 bond pursuant to CPLR §6312 no later than September 28, 2022. During the course of the September 16, 2022 proceedings, the Court directed plaintiffs to produce copies of all bank statements, including all checks, written on all of the bank accounts of either plaintiff PMWA or PMAW, by September 30, 2022 and thereafter confer to agree upon deposition dates based on a Note of issue deadline to which the parties will agree (no later than the current May 31, 2023 Note of Issue deadline). A status conference is scheduled for October 3, 2022 at 10:00 a.m. via Microsoft Teams. This case, prior proceedings in this Court, and multiple proceedings in other fora simply represent a personal vendetta pursuant to which the parties have expended enormous personal resources and misused substantial judicial resources. Counsel for the parties are disserving their clients’ interests by not counseling their clients to cease escalating the personal vendetta between counsels’ respective clients. Whatever monetary damages either party may be ultimately seeking to recover are dwarfed by the expenses of prosecuting cases in multiple fora. In the course of the proceedings in this Court, plaintiffs have violated a prior Temporary restraining Order issued by this court. Counsel are strongly advised to seek a consensual resolution of this dispute. Accordingly, it is hereby ORDERED that plaintiffs P.M.W.A. Hair Stylist Inc. d/b/a Paul Mole Barbershop, Catch The Wave, Inc., and Wai Yee Rooney A/K/A Susan Rooney are preliminarily enjoined from: (1) denying defendant Adrian Wood a copy of all keys to the Premises at 1034A Lexington Avenue, New York, New York, (2) denying defendant Adrian H. Wood full access to the Premises at 1034A Lexington Avenue, New York, New York, (3) failing to reinstate or grant, on a forthwith basis, full access and signatory power to defendant Adrian H. Wood for each bank account at each financial institution where plaintiff P.M.W.A. Hair’s financial accounts exist, (4) withdrawing or causing to be withdrawn money using a check from any account belonging to plaintiff P.M.W.A. Hair, unless co-signed by both defendant Adrian Wood and plaintiff Susan Rooney, with the exception of payments for rent, water and taxes owed with respect to 1034A Lexington Avenue, corporate taxes, payroll payments to plaintiff P.M.W.A. Hair employees that are consistent with legitimate prior payments, and payments for supplies and equipment consistent with prior payments, (5) withholding payment toward rent arrears and other payments owed by plaintiff P.M.W.A. hair towards the Barbershop’s landlord, (6) and removing or allowing the removal of any of the personal property located at 1034A Lexington Avenue, New York, New York, including but not limited to the items listed at paragraph 371 of the Verified Answer with Affirmative Defenses and Counterclaims; and it is further ORDERED that defendant is directed to post an undertaking pursuant to CPLR §6312 in the amount of $75,000.00 no later than September 28, 2022; and it is further ORDERED that the parties are directed to exchange, via counsel, copies of all bank statements, including all checks, written on all of the bank accounts of either plaintiff P.M.W.A. Hair or P.M.A.W. Hair, by the end of the day on September 30, 2022. CHECK ONE: CASE DISPOSED X NON-FINAL DISPOSITION X GRANTED DENIED GRANTED IN PART OTHER APPLICATION: SETTLE ORDER SUBMIT ORDER CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE Dated: September 16, 2022
