On June 18, 2025, Justice Andrew Borrok of the Manhattan Commercial Division issued a post-trial decision in IGC 444 Park LLC et al. v. 444 PAS Restaurant Associates LLC et al., finding individual defendant David Moinian (“Moinian”) personally liable for defamation per se. The ruling arose from statements Moinian made accusing IGC 444 of taking kick-backs, an allegation the court found to be both false and damaging to IGC 444’s professional reputation.
Background
On July 16, 2017, plaintiff IGC 444 Park LLC (“IGC 444”) entered into a management agreement with defendant 444 PAS Restaurant Associates LLC (“444 PAS”) to operate food and beverage services at the Mondrian Park Avenue Hotel. David Moinian signed the agreement as managing member of 444 PAS.
Under the agreement, 444 PAS was obligated to, inter alia, maintain a $150,000 working capital account, sign and submit any checks and invoices prepared by IGC 444 for payment of expenses related to food and beverage operations, and pay a management fee to IGC 444.
On January 21, 2019, IGC 444 issued a notice of default to 444 PAS and Moinian, alleging repeated breaches of the management agreement, including failure to pay invoices, maintain the working capital balance, and pay management fees. When 444 PAS failed to cure these breaches, IGC 444 filed suit, asserting various causes of action, including breach of the management agreement and defamation against Moinian, both individually and in his capacity as managing member of 444 PAS.
The Defamation Claim
The defamation claim arose from a July 13, 2020, email Moinian sent to third parties—IGC 444’s competitors and lenders— in which he accused IGC 444 of receiving kick-backs:
“Your account is frozen due to allegedly all the vendor kick backs you have received behind our back.”
IGC 444 argued that the statement was false and malicious, and that Moinian “defamed them by besmirching their reputation in their profession to others and by accusing them of taking kick-backs.”
Under New York law, a defamation action requires: “a false statement, published without privilege or authorization to a third party, constituting fault as judged by, at a minimum, a negligence standard, and, it must either cause special harm or constitute defamation per se.” Statements qualify as defamation per se if they: (i) charge someone with a serious crime, (ii) tend to injure another in his or her trade, business, or profession, (iii) state that plaintiff has a loathsome disease, or (iv) impute unchastity to a woman.
Only statements of fact—not opinion—can support a defamation claim. “In distinguishing between facts and opinion, the factors the court must consider are (1) whether the specific language has a precise meaning that is readily understood, (2) whether the statements are capable of being proven true or false, and (3) whether the context in which the statement appears signals to readers that the statement is likely to be opinion, not fact” (Silverman v Daily News, L.P.).
The Court’s Findings
Justice Borrok found that Moinian’s email crossed the line into actionable defamation:
“The statements made by Mr. Moinian in his email, dated July 13, 2020 (PX I), were made because, as Mr. Moinian himself testified, he was angry. The statements were not made for a legitimate purpose and were made in response to a simple request for monies owed. Mr. Moinian’s testimony that he merely intended to inspire an investigation was simply not credible. and he adduced no documents in support of his assertion. Mr. Moinian did not make the statements to his attorneys, nor did he exclude third parties from the communications, nor did he indicate to Mr. Brosi that an investigation was being initiated due to billing issues. He did none of that. Instead, he just acted out and in a manner designed to embarrass and besmirch the reputation of IGC 444 and Mr. Brosi.”
The Court emphasized that despite Moinian’s professed expertise in the restaurant business and billing practices, he relied on statements by his manager that IGC 444 was stealing without conducting any investigation into the allegations. The record also contained no evidence of any financial wrongdoing by IGC 444. Instead, the Court found that Moinian’s statements “published to IGC 444’s competitors and lenders were angry and retaliatory and at bottom nothing more than an attempt to put off demand for amounts due by attempting to embarrass IGC 444 with scurrilous remarks to others.”
Damages and Corporate Liability
Accordingly, the Court held that Moinian’s accusation that IGC 444 had committed a serious crime, along with his disparaging statements aimed at harming the company’s business and professional reputation, constituted defamation per se.
The Court held that Moinian was personally liable for defamation per se and awarded IGC 444 $25,000 in actual damages and $1 in punitive damages.
The Court declined to hold 444 PAS liable, reasoning that the statements were not made in Moinian’s official capacity as an officer of 444 PAS, not part of the normal course of business, and not reasonably viewed as a corporate act.
As Justice Borrok put it, this was a “closer call,” but ultimately the statements could not be attributed to the company.
Key Takeaways
This decision highlights a few critical points about defamation in the business context:
- Executives can be held personally liable for defamatory statements made outside the scope of their corporate roles even when those statements are related to a business dispute.
- Defamation per se remains a powerful claim, especially when false statements accuse someone of criminal conduct or harm their professional reputation.
- For business leaders, this case serves as a reminder that reckless or emotionally charged accusations—even in emails—can result in personal and financial consequences.
In short: Count to 10 before you send.
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