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December 17, 2024

November 22, 2024

Partner Evan Richman obtains a dismissal of an Article 78 Petition based on a newly enacted email verification requirement

Partner Evan Richman obtained the dismissal of an Article 78 Petition filed against the defendant Condominium, Board of Managers, individual Board members, and the property manager challenging the validity of the Board election containing an email verification requirement pursuant to the recent amendments to the Not-for-Profit Corporation Law.  The petitioners submitted a series of proxies that they contended should be counted in the Board election which would then swing the election in the petitioners’ favor.  However, the petitioners did not comply with a newly enacted email verification requirement in connection with proxies and thereby the proxies were not counted in the election.  The Court adopted Mr. Richman’s arguments that the Board’s changes to the electronic proxy voting procedures were authorized by amendments to the Not-for-Profit Corporation Law section 603 in response to the Covid pandemic.  Moreover, the Court highlighted that this email verification requirement was reasonable as a matter of law and that the Business Judgment Rule precluded any further judicial scrutiny of such electronic voting requirements.  Swissgem S.A. v. M&B Ltd., 193 A.D.3d 472, 141 N.Y.S.3d 700 (1st Dept. 2021)

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