Hills Stores Company et al., Appellants, v. Smith Barney, Inc., Respondent

Hills Stores Company et al., Appellants, v Smith Barney, Inc., Respondent. [658 NYS2d 847] [MAJORITY] Judgment, Supreme Court, New York County (Stephen Crane, J.), entered April 16, 1996, dismissing the complaint, and bringing up for review an order, same court and Justice, entered April 3, 1996, which, in an action by plaintiffs against defendant financial advisor for gross negligence, willful misconduct, breach of fiduciary duties in rendering financial advice in connection with a proxy contest, granted defendant’s motion to dismiss the complaint for failure to state a cause of action, unanimously affirmed, without costs. The appeal from the order is unanimously dismissed as subsumed within the appeal from the judgment. We agree with the motion court that the release given in settlement of the preproxy litigation embraces the instant claims and provides sufficient grounds for dismissal. In addition, another ground for dismissal is the failure to allege facts showing a causal relationship between defendant’s untruthful advice and plaintiffs’ damages, the fair import of the complaint being that the outgoing board members had all along determined to reject any offer regardless of defendant’s advice. Concur—Sullivan, J. P., Milonas, Ellerin, Tom and Mazzarelli, JJ.