FALGUN DHARIA VS. OM RIDDHI SIDDHI, LLC,ET AL.(L-320-14, ESSEX COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R.1:36-3.

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4445-14T3

FALGUN DHARIA and MANTIFF
MANAGEMENT, INC.,

Plaintiffs-Appellants/
Cross-Respondents,

v.

OM RIDDHI SIDDHI, LLC and
SAMIR SHAH,

Defendants-Respondents/
Cross-Appellants.
____________________________________

Submitted November 7, 2016 – Decided August 11, 2017

Before Judges Sabatino, Nugent and Currier.

On appeal from Superior Court of New Jersey,
Law Division, Essex County, Docket No. L-320-
14.

Genova Burns LLC, attorneys for appellants
/cross-respondents (Jennifer Borek, of
counsel; Jenna M. Beatrice, on the briefs).

Bendit Weinstock, PA, attorneys for
respondents/cross-appellants (James F. Keegan
and Sherri D. Fowler, on the briefs).

PER CURIAM
 Plaintiffs Falgun Dharia and Mantiff Management, Inc., appeal

from three Law Division orders, one dated December 5, 2014, two

dated February 6, 2015. The first order denied, in part,

plaintiffs' motion to compel discovery. The second order granted

summary judgment to defendants Om Riddhi Siddhi, LLC, and Samir

Shah, and dismissed the complaint with prejudice. The third order

denied plaintiffs' second motion to compel discovery. Defendants

cross-appeal from an April 24, 2015 order denying their motion for

sanctions. For the reasons that follow, we reverse the discovery

and summary judgment orders and affirm the order denying

sanctions.1

In the complaint filed January 16, 2014, plaintiff alleged

five causes of action stemming from defendant's alleged breach of

an oral contract. According to the complaint, plaintiff agreed

to provide consulting services and start-up capital to defendant,

who sought to own and operate various Dunkin' Donuts franchises.

In exchange, defendant agreed to compensate plaintiff with a one-

third equity ownership interest in each of the franchised stores

and periodic distributions equal to one-third of the stores'

profits.

1
Plaintiff Falgun Dharia is the principal of Mantiff Management
Inc. For ease of reference, we refer to Falgun Dharia as
"plaintiff." For similar reasons, we refer to Samir Shah as
"defendant."

2 A-4445-14T3
 During discovery, plaintiff served defendant with

interrogatories and document demands. Plaintiff sought, among

other documents, business and bank records, e-mails discussing

profit distributions, Dunkin' Donuts audits, profit and loss

statements, QuickBook files, and corporate and personal tax

returns dating back to 2006. Defendant objected to most of the

discovery demands, contending the requests were overbroad, sought

privileged information, or otherwise sought non-existent

information.

In the first discovery motion, plaintiff sought to compel

defendant to provide more specific answers to interrogatories and

document demands. The trial court issued a December 5, 2014 order

granting the motion in part. The order permitted plaintiff to

inspect documents defendant identified as being in his office, but

struck plaintiff's request to compel more specific answers to

interrogatories. In denying most of plaintiff's requests, the

court wrote on the order that plaintiff had "failed to establish

[the] items sought will have a tendency in reason to prove or

disprove any fact of consequence to the determination of the

action."

On December 19, 2014, defendant filed a summary judgment

motion, which plaintiff opposed. Meanwhile, plaintiff filed a

second motion to compel discovery on December 24, 2014, alleging

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defendant failed to comply with the previous discovery order and

withheld relevant documents. The trial court denied plaintiff's

discovery motion in an order dated February 6, 2015. The court

wrote on the order, "see order of December 5, 2014." On the same

day, the court granted defendant's motion for summary judgment.

The court determined plaintiff did not come forward with any

documentary evidence tending to show the existence of the alleged

oral agreement.2 The court concluded that no trier of fact could

rule in plaintiff's favor. The court granted summary judgment

notwithstanding that the discovery end date was April 1, 2015.

Following the court's grant of summary judgment to defendant,

he filed a motion seeking fees from plaintiffs under Rule 1:4-8

and N.J.S.A. 2A:15-59.1 for filing frivolous claims. The court

denied the motion.

The parties developed the following facts on the summary

judgment motion record. Sometime in 2003, defendant and Atul

Rajguru (Rajguru) learned plaintiff was attempting to sell his

interest in several Dunkin' Donuts franchised stores. Defendant

claimed he and Rajguru met with plaintiff to discuss the purchase

of one of his stores, but were unable to reach an agreement.

2
On the same day, the court entered a third order granting
defendant's motion to compel the deposition of plaintiff,
notwithstanding the dismissal of the matter with prejudice.

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Plaintiff nonetheless invited him and Rajguru to contact him in

the event they needed assistance in starting a new business.

According to defendant, in December 2003, his wife and Rajguru

formed Om Riddhi Siddhi, LLC (the "West Orange LLC"), in which

each held a fifty percent interest. In January 2004, the West

Orange LLC entered into a Multiple Unit Store Development Agreement

(the Store Development Agreement) with Baskin-Robbins USA Co. and

Dunkin' Donuts. In July 2005, the LLC opened a Dunkin' Donuts

store in West Orange.

Several years later, defendant and Rajguru formed a separate

LLC named Om Shree Riddhi Siddhi LLC ("the Livingston LLC"), which

acquired a franchise and opened a Dunkin' Donuts in Livingston in

August 2007. In the same year, defendant purchased Rajguru's

fifty percent interest in the West Orange LLC. In 2008, Rajguru

purchased defendant's interest in the Livingston LLC.

In support of his summary judgment motion, defendant averred

plaintiff had no involvement in the application for the Store

Development Agreement. Defendant also asserted he and Rajguru

never sought or received any consulting services or investment

capital from plaintiff and never made any payments or profit

distributions to plaintiff. Plaintiff was not listed as a partner

on either the West Orange LLC's or the Livingston LLC's Schedule

K-1s between 2004 and 2013.

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 Plaintiff largely disputed defendant's statement of material

facts. According to plaintiff, he, defendant, and Rajguru were

partnering to develop new Dunkin' Donuts franchises in West Orange,

Livingston, and Montville. To facilitate their business

development, plaintiff entered into an oral consulting agreement

with defendant and Rajguru, whereby he would provide consulting

services and startup capital in exchange for a one-third equity

interest in the LLCs and certain profit distributions. Plaintiff

claimed to have owned an equity interest in the West Orange LLC

since 2003 and received profit distributions from the West Orange

store until November 2007. Although plaintiff did not produce any

documentary evidence that defendant paid him any profit

distributions, he contended during oral argument that defendant

has such proof, necessitating further discovery.

Plaintiff also averred that he, Rajguru, and defendant's wife

opened a joint bank account in late 2003. In support of this

claim, plaintiff submitted a bank statement listing himself,

Rajguru, and defendant's wife as the account's owners.3 The bank

statement listed various transactions between November 28, 2003

and December 8, 2003. Plaintiff also provided a copy of a $30,000

3
Defendant contended plaintiff opened this account without his
wife's or Rajguru's knowledge.

6 A-4445-14T3
check dated January 20, 2004, which he wrote to the West Orange

LLC. The memo line of the check read, "West Orange – SDA." It

is unclear whether the check was cashed.

In addition to the bank statement and check, plaintiff

submitted an e-mail he received from defendant in May 2007

discussing after-tax profit distributions. He also submitted a

December 2007 e-mail from defendant with the subject line: "West

Orange – Profit." A balance spreadsheet was attached to the email

stating plaintiff and defendant each had a one-third interest in

an unidentified business.

The motion record also includes two e-mails from defendant

to plaintiff in April 2007. In these e-mails, defendant discusses

profit sharing with plaintiff and how plaintiff "need[s] to figure

out how to take [his] money. . . ."

Plaintiff also produced evidence concerning the Livingston

LLC. He submitted a document purporting to be a copy of meeting

minutes from March 2007 memorializing that plaintiff and

defendant, as well as other individuals, each held a twenty-two

percent interest in the Livingston Dunkin' Donuts.

On October 28, 2010, plaintiff filed a complaint against

Rajguru and the Livingston LLC, alleging substantially similar

allegations. Plaintiff did not name defendant in that lawsuit.

According to plaintiff's counsel, the matter was settled via a

7 A-4445-14T3
confidential settlement where "Rajguru was forced to sell his

stores, because Dunkin' found out there was an undisclosed owner[,

plaintiff]."

Based on the foregoing record, the trial court granted summary

judgment in favor of defendant and denied plaintiff's motion to

compel further discovery.

On appeal, plaintiff contends the trial court erred by

prematurely granting summary judgment when discovery was

incomplete. Plaintiff also contends the court erred in granting

the motion because there were genuine issues of material fact in

dispute. Lastly, plaintiff contends the trial court applied the

wrong standard of review when denying his discovery motions.

Defendant argues the trial court did not err in granting

summary judgment, because no rationale fact finder could find in

favor of plaintiff. Defendant also argues the alleged oral

consulting agreement was not supported by consideration, and in

any event, was barred by the statute of limitations and the entire

controversy doctrine. Lastly, in opposition to plaintiff's

appeal, defendant argues the court properly denied plaintiff's

motions to compel more specific discovery responses.

On the cross-appeal, defendant contends the court erred in

denying his motion for sanctions.

8 A-4445-14T3
 We review "an order granting summary judgment in accordance

with the same standard as the motion judge." Bhagat v. Bhagat,

217 N.J. 22, 38 (2014) (citations omitted). "That standard compels

the grant of summary judgment 'if the pleadings, depositions,

answers to interrogatories and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as to

any material fact challenged and that the moving party is entitled

to a judgment or order as a matter of law.'" Globe Motor Co. v.

Igdalev, 225 N.J. 469, 479 (2016) (quoting R. 4:46-2(c)).

To establish a genuine issue of material fact, the opposing

party must "do more than 'point[] to any fact in dispute' in order

to defeat summary judgment." Ibid. (alteration in original)

(citation omitted). Rather, "once the moving party presents

sufficient evidence in support of the motion, the opposing party

must 'demonstrate by competent evidential material that a genuine

issue of fact exists[.]'" Id. at 479-80 (alteration in original)

(quoting Robbins v. Jersey City, 23 N.J. 229, 241 (1957)).

Ultimately, a reviewing court must determine "whether the

competent evidential materials presented, when viewed in the light

most favorable to the non-moving party, are sufficient to permit

a rational factfinder to resolve the alleged disputed issue in

favor of the non-moving party." Davis v. Brickman Landscaping,

Ltd., 219 N.J. 395, 406 (2014) (citation omitted).

9 A-4445-14T3
 Here, plaintiff established numerous genuinely disputed

material facts that precluded summary judgment. In addition to

his certification asserting the formation and terms of the oral

agreement, he produced a $30,000 check payable to defendant with

a notation "West Orange – SDA"; a bank statement listing himself,

defendant's wife, and Rajgur as owners; emails discussing profit

distributions; and meeting minutes concerning his alleged interest

in the Livingston Dunkin' Donuts. When viewed in the light most

favorable to plaintiff, his certified statements, corroborated by

documentary evidence, establish a triable issue as to whether he

and defendant had entered into an oral agreement under the terms

alleged by plaintiff. Moreover, to the extent plaintiff's

documentary evidence was either ambiguous or in dispute, discovery

remained open and the court should have permitted discovery as to

these and any other outstanding issues before granting the summary

judgment motion.

The record concerning plaintiff's discovery motions is scant.

Nonetheless, because additional discovery was warranted before

summary judgment was granted, and in view of our disposition of

this appeal, we vacate the orders denying plaintiff's discovery

motion.

On remand, the trial court shall conduct a management

conference within forty-five days. During the conference, the

10 A-4445-14T3
parties and the court can resolve any issues concerning outstanding

discovery. To the extent either party opposes discovery based

upon a privilege or a claim concerning relevance, a clear record

should be made concerning the precise discovery requested and the

specific grounds upon which it is opposed. The trial court should

make a record with respect to each discovery request opposed,

stating the legal basis for denying the discovery request if it

is denied. If necessary, the court shall conduct an in-camera

document review to facilitate the disposition of discovery

disputes.

In view of our disposition of the summary judgment motion,

the issue raised on the cross-appeal is moot. We have determined

that arguments not specifically addressed in this opinion are

without sufficient merit to warrant discussion. R. 2:11-

3(e)(1)(E). We note the parties have raised issues and factual

allegations on appeal that were either not addressed by the trial

court or not presented to the trial court. These issues can be

properly developed on remand and decided on an amply developed and

adequate record.

Reversed and remanded for further proceedings consistent with

this opinion. We do not retain jurisdiction.

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