Pleading in the Alternative Preserved at the 3211 Stage Absent a Conceded Contract; Veil-Piercing Requires Specific Wrongdoing: Commentary on Jobble, Inc. v. CF Alerts Corp.

Court: Appellate Division of the Supreme Court, Second Department (New York) — October 8, 2025

Citation: 2025 NY Slip Op 05506 (opinion uncorrected and subject to revision)

Introduction

In Jobble, Inc. v. CF Alerts Corp., the Second Department clarified two recurring issues at the pleadings stage in commercial disputes: (1) when quasi-contract and promissory estoppel claims may proceed alongside a breach of contract claim, and (2) what is required to hold a corporate principal personally liable under a veil-piercing theory.

The plaintiff, Jobble, Inc., sued several corporate entities—CF Alerts Corp., Flyrim Tech Corp (Flyrim), and Fire Brick Group, Ltd.—and an individual principal, David Brensilber, alleging breach of contract and a suite of related theories. The Supreme Court (Nassau County) dismissed multiple causes of action against Flyrim as duplicative or insufficient, and dismissed the complaint as to Brensilber. On appeal, the Second Department reinstated several claims against Flyrim, while affirming dismissal of claims against Brensilber.

The decision reaffirms liberal pleading principles under CPLR 3211(a)(7), emphasizes the permissibility of alternative pleading under CPLR 3014 where the existence or scope of a contract is not conceded, and underscores the rigor of veil-piercing pleading requirements.

Summary of the Opinion

Disposition: The order was modified “on the law.” The Appellate Division:

Affirmed dismissal of the complaint as against David Brensilber (the individual principal). The plaintiff’s veil-piercing allegations were insufficient, and no alternative basis for personal liability was adequately pleaded.
Affirmed dismissal of the implied covenant of good faith and fair dealing claim against Flyrim as duplicative of the breach of contract claim.
Reinstated the unjust enrichment and quantum meruit causes of action against Flyrim, because the moving defendants did not concede the existence of a governing contract; alternative pleading is permitted.
Reinstated the promissory estoppel claim against Flyrim for the same reason; at the pleadings stage it was not duplicative.
Reinstated the account stated claim against Flyrim, finding the complaint’s allegations sufficient to state a claim.

In short, the court preserved Jobble’s alternative quasi-contractual and promissory estoppel theories and its account stated claim against Flyrim, while confirming that the implied covenant theory cannot replicate a breach claim and that the complaint did not justify personal liability against the principal.

Analysis

Precedents Cited and Their Influence

CPLR 3211(a)(7) pleading standard: The court invoked Leon v. Martinez, 84 NY2d 83, and Cantor v. Villucci, 212 AD3d 765, to reiterate that on a motion to dismiss for failure to state a cause of action, courts must liberally construe the complaint, presume the facts as true, give the plaintiff favorable inferences, and ask only whether the allegations fit any cognizable legal theory. Lam v. Weiss, 219 AD3d 713, further underscores that “inartfully pleaded” claims should survive if facts suffice, and that merits questions are for later stages.
Veil piercing (personal liability of a principal): The court relied on Rosenshein v. Kushner, 212 AD3d 744, and East Hampton UFSD v. Sandpebble Bldrs., Inc., 16 NY3d 775, to restate the two-part test: complete domination as to the transaction at issue, and use of that domination to commit a fraud or wrong such that equity should intervene. Grammas v. Lockwood Assoc., LLC, 95 AD3d 1073, listed nonexclusive factors (failure to observe formalities, inadequate capitalization, commingling, personal use of corporate funds). The court cited Tabchouri v. Hard Eight Rest. Co., LLC, 219 AD3d 528, Ruland v. Leibowitz, 209 AD3d 1051, and Crawford v. Integrated Asset Mgt. Servs., LLC, 236 AD3d 750, to illustrate insufficient pleadings where plaintiffs fail to allege specific facts showing both domination and wrongful use of the corporate form. Berejka v. Huntington Med. Group, P.C., 235 AD3d 821, supported the conclusion that no alternative basis for personal liability (e.g., torts personally committed, personal guaranty) was adequately pleaded.
Duplicative implied covenant claim: Goldberg v. KOSL Bldg. Group, LLC, 236 AD3d 995, and BT Holdings, LLC v. Village of Chester, 189 AD3d 754, were cited to hold that implied covenant claims must be dismissed where they rely on the same facts and seek the same damages as a breach of contract claim.
Alternative pleading of quasi-contract and promissory estoppel: CPLR 3014 permits alternative and inconsistent pleading. The court cited Emby Hosiery Corp. v. Tawil, 196 AD3d 462, and Thompson Bros. Pile Corp. v. Rosenblum, 121 AD3d 672, to hold that unjust enrichment and quantum meruit may be pleaded in the alternative where defendants do not concede a contract that covers the dispute. Woodstock Constr. Group, Ltd. v. State of New York, 130 AD3d 1018, and Arnone v. Burke, 211 AD3d 998, similarly support allowing promissory estoppel to proceed as a non-duplicative, alternative theory when a contract’s existence or scope is unresolved.
Account stated: The court quoted Toobian v. Toobian, 209 AD3d 907, and Citibank (S.D.) N.A. v. Cutler, 112 AD3d 573, to explain that an account stated arises from the parties’ agreement, express or implied, as to the correctness of account items and a specific balance. An agreement may be implied where bills are retained without timely objection or partial payment is made. American Express Centurion Bank v. Cutler, 81 AD3d 761, Nouveau El. Indus., Inc. v. Glendale Condominium Town & Tower Corp., 107 AD3d 965, and Fleetwood Agency, Inc. v. Verde Elec. Corp., 85 AD3d 850, further support that pleading such facts suffices to state a claim.

Legal Reasoning

Veil piercing and individual liability dismissed: The complaint did not sufficiently allege that Brensilber exercised “complete domination” over the corporate defendants regarding the specific transactions, nor that he used such domination to perpetrate a fraud or wrong against Jobble. The court emphasized the second element—misuse of the corporate form to commit a wrong—which is often the stumbling block. Conclusory statements that a principal “owns” or “controls” corporations do not meet the standard. The court also found no adequately pleaded alternative path to individual liability (e.g., personal torts, guaranty).
Implied covenant claim dismissed as duplicative: Where the same conduct and damages underlie both breach of contract and implied covenant claims, the latter is superfluous. The court applied a familiar rule: the implied covenant cannot create new contractual rights or duplicate the breach claim.
Unjust enrichment and quantum meruit reinstated as alternative theories: Because the moving defendants did not concede that a valid contract governed the dispute, the plaintiff could pursue quasi-contract theories in the alternative under CPLR 3014. Dismissal at the pleadings stage was premature; the contract’s existence/scope remains a merits question for later resolution. This reinforces an important sequencing principle: early dismissal of quasi-contract claims is usually improper unless defendants concede or establish a contract covering the subject matter.
Promissory estoppel reinstated and not duplicative: Similarly, promissory estoppel can be pleaded where the existence or applicability of a contract is uncertain. The claim was not duplicative precisely because defendants did not concede a governing contract. The allegations sufficiently pleaded a promise, reasonable reliance, and a resulting injury.
Account stated reinstated: The complaint alleged that invoices or statements were sent and retained without objection, or that partial payments were made—allegations that, if true, create an implied agreement as to the correctness of the account and a specific balance. That sufficed under the liberal 3211 standard.

Impact and Practical Implications

This decision carries several practical consequences for commercial litigators in New York:

Alternative pleading protected: Plaintiffs can preserve unjust enrichment, quantum meruit, and promissory estoppel at the motion-to-dismiss stage when defendants do not concede a binding contract covers the dispute. This allows plaintiffs to proceed to discovery without prematurely abandoning quasi-contract theories.
Defense strategy on 3211 motions: Defendants seeking to eliminate quasi-contract and promissory estoppel claims early should consider expressly conceding (and attaching) a valid and binding contract that unambiguously governs the subject matter. Absent such a concession, dismissal of alternatives is unlikely in the Second Department.
Implied covenant claims at risk: Even where alternative pleading is allowed, implied covenant claims will be dismissed if they mirror the breach claim. To survive, an implied covenant claim must rest on conduct not expressly addressed by the contract and seek distinct damages.
Veil piercing remains exacting: Naming principals individually without detailed, transaction-specific allegations of both domination and misuse of the corporate form to perpetrate a wrong invites dismissal. Plaintiffs should plead concrete facts: undercapitalization, commingling, disregard of formalities, personal siphoning, or using the corporation to defraud creditors, tied to the transaction at issue.
Account stated as a collection tool: Where invoices were sent and retained without objection, or partial payments made, an account stated claim can survive. It can be a potent cause of action alongside breach of contract, often simplifying proof of the amount due.

More broadly, the case aligns the Second Department with robust protection for alternative pleading in contract disputes and signals continued skepticism of veil-piercing allegations that lack transaction-specific wrongdoing.

Complex Concepts Simplified

CPLR 3211(a)(7) — Motion to Dismiss for Failure to State a Claim: The court assumes the plaintiff’s facts are true and asks only whether, if those facts are true, the law would allow recovery under any legal theory. The court does not decide who will win; it decides whether the case may proceed.
CPLR 3014 — Alternative Pleading: New York allows a party to plead different and even inconsistent legal theories at the same time (e.g., breach of contract and unjust enrichment), especially where it’s unclear which theory will ultimately apply. Dismissal of alternatives at the outset is improper unless a controlling contract is conceded or established.
Implied Covenant of Good Faith and Fair Dealing: Every contract includes a promise that neither side will do anything to destroy or injure the other’s right to the fruits of the contract. However, you can’t get a separate claim for this if it just repeats the contract breach on the same facts and damages.
Unjust Enrichment and Quantum Meruit (Quasi-Contract): These are equitable claims to prevent unfair benefit or to pay for services’ reasonable value when no enforceable contract governs the transaction. They can be pleaded when the existence or reach of a contract is uncertain.
Promissory Estoppel: Allows recovery when a clear promise induces reasonable reliance causing harm, even if no contract exists. It is often pleaded as a fallback in case a contract is found unenforceable or inapplicable.
Account Stated: A separate claim that arises when a creditor sends statements of account (e.g., invoices), and the debtor either keeps them without timely objection or makes partial payments. The law implies an agreement that the stated balance is correct.
Piercing the Corporate Veil: An extraordinary remedy that disregards the corporation’s separate legal identity to hold owners personally liable. It requires showing (1) complete domination over the corporation in the specific transaction, and (2) use of that domination to commit a fraud or wrong. Conclusory allegations of ownership or control are not enough.

Conclusion

Jobble underscores a pair of enduring rules in New York practice. First, unless a defendant concedes a governing contract, plaintiffs are entitled to plead quasi-contract and promissory estoppel in the alternative to a breach of contract claim; those theories should not be dismissed at the 3211 stage simply as “duplicative.” The court also reaffirmed the vitality of account stated as a standalone claim when invoices are retained without objection or partially paid. Second, veil-piercing remains a high bar: plaintiffs must allege not just domination, but misuse of the corporate form to commit a wrong tied to the transaction at issue; absent such facts, individual principals will be dismissed early.

Practically, the decision encourages careful motion practice: defendants seeking early narrowing should consider conceding and proving the governing contract to foreclose quasi-contract and estoppel claims, while plaintiffs should plead detailed alternative theories and, if seeking to reach individuals, provide transaction-specific facts showing both domination and wrongful abuse of the corporate form. The ruling thereby balances liberal pleading with principled limits on duplicative contract theories and personal liability.