Shepherd v. Gallo Restaurant of Patchogue, LLC: Dram Shop Liability Beyond Premises Boundaries and the Limits of Duties Owed by Landowners and Security Contractors

I. Introduction

A. Background and Parties

In Shepherd v. Gallo Restaurant of Patchogue, LLC, 2025 NY Slip Op 07327 (2d Dept Dec. 24, 2025), the Appellate Division, Second Department, addressed a recurring problem in modern nightlife and premises-liability litigation: what duties, if any, do a restaurant, bar, and its contracted security company owe to a patron who is assaulted on a public sidewalk immediately outside the establishment?

The plaintiff, Kyle Shepherd, alleged that he sustained personal injuries when he was assaulted by unidentified individuals on a public sidewalk in front of a restaurant-bar owned and operated by defendant Gallo Restaurant of Patchogue, LLC (“Gallo”) in Patchogue, New York. Security services at the establishment were provided by defendant American Protection Bureau, Inc. (“American”) pursuant to a contract with Gallo.

Shepherd sued Gallo, American, and another defendant (not central to the appeal) asserting:

Common-law negligence claims against Gallo and American.
A statutory claim under New York’s Dram Shop Act (General Obligations Law § 11‑101) against Gallo and others, alleging unlawful sale of alcohol to a visibly intoxicated person resulting in his injuries.

Gallo, in turn, asserted a cross-claim for contractual indemnification against American, attempting to shift any liability and defense costs arising from Shepherd’s lawsuit to the security company.

B. Procedural Posture

After discovery, both Gallo and American moved for summary judgment:

Gallo sought (i) dismissal of the complaint as against it—including the Dram Shop claim and the negligence claim—and (ii) in the alternative, summary judgment on its contractual indemnification cross‑claim against American.
American sought dismissal of all claims and cross‑claims asserted against it, including negligence and Gallo’s indemnification cross‑claim.

The Supreme Court, Suffolk County (Reilly, J.), in an order dated October 26, 2021, ruled as follows:

Dram Shop claim vs Gallo: Denied Gallo’s motion for summary judgment; the Dram Shop cause of action survived.
Negligence claims vs Gallo and American: Granted summary judgment to both; the negligence causes of action were dismissed as against each.
Contractual indemnification: Denied Gallo’s motion for summary judgment on its contractual indemnification cross‑claim; granted American’s motion dismissing that cross‑claim.

Gallo appealed the denial of summary judgment on the Dram Shop claim and the denial of its indemnification cross‑claim. Shepherd cross‑appealed the grant of summary judgment dismissing the negligence claims against both Gallo and American.

C. Core Legal Issues

The Second Department was called upon to resolve four principal issues:

Dram Shop / statutory liability: Did Gallo, as the moving party, meet its prima facie burden to obtain summary judgment dismissing the Dram Shop claim by showing either (a) that it did not serve alcohol to a visibly intoxicated person, or (b) that any such sale had no reasonable or practical connection to Shepherd’s injuries?
Common-law premises liability (Gallo): Did Gallo owe a common-law duty of care to Shepherd for an assault that occurred on a public sidewalk outside the restaurant, allegedly by intoxicated patrons, such that a negligence claim could lie?
Tort duty of the security contractor (American): Did American owe Shepherd—a patron of the restaurant—a duty of care under a third‑party‑beneficiary theory, or otherwise, sufficient to maintain a negligence claim?
Contractual indemnification: Did the indemnity provisions in the Gallo–American contract require American to indemnify Gallo for the claims asserted by Shepherd, including dram shop liability?

The decision clarifies the interplay between statutory Dram Shop liability and common‑law premises liability, and it reinforces doctrinal limits on when security contractors owe duties in tort to injured patrons.

II. Summary of the Opinion

The Second Department affirmed the Supreme Court’s order in all respects, with one bill of costs awarded to American against both Shepherd and Gallo. In effect:

Dram Shop claim vs Gallo: The panel held that Gallo failed to meet its prima facie burden for summary judgment. Gallo could not defeat the claim merely by pointing to “gaps” in the plaintiff’s proof; it had to affirmatively demonstrate either no visible intoxication at the time of service or no reasonable/practical connection between its sale of alcohol and the assault. Because Gallo did not do so, the Dram Shop claim survives and will proceed.
Negligence claim vs Gallo: The court held that Gallo did establish, prima facie, that the assault occurred in an area— the public sidewalk—outside of its property or control. Under settled New York law, a landowner’s duty to protect patrons from third‑party assaults is limited to its property and areas under its control. Since the sidewalk was outside Gallo’s control, Gallo owed no duty to Shepherd as to that location, and the negligence claim was properly dismissed.
Negligence claim vs American (security company): The court held that American had no tort duty to Shepherd. The plaintiff tried to frame himself as a third‑party beneficiary of the Gallo–American security contract, but the contract did not clearly express an intent to confer a direct benefit on patrons. Even if Shepherd were a third‑party beneficiary, American’s failure (if any) to fulfill its contractual obligations would give rise only to a breach‑of‑contract claim, not to a negligence claim. The negligence cause of action against American was therefore properly dismissed.
Contractual indemnification (Gallo vs American): The panel affirmed the dismissal of Gallo’s contractual indemnification cross‑claim and the denial of Gallo’s own motion on that cross‑claim. The court thus left American free of any duty to indemnify Gallo for Shepherd’s claims.

The practical result is that:

American is removed from the litigation entirely (no negligence and no indemnity exposure).
Gallo faces trial solely on the Dram Shop Act cause of action.
No common‑law negligence claims survive against either Gallo or American for this off‑premises assault.

III. Analysis of the Opinion

A. The Dram Shop Claim Against Gallo

1. Statutory Framework and Elements

The court grounds its analysis in the Dram Shop Act—General Obligations Law § 11‑101(1)—and Alcoholic Beverage Control Law § 65(2). Relying on Flynn v Bulldogs Run Corp., 171 AD3d 1136 (2d Dept 2019), Pinilla v City of New York, 136 AD3d 774 (2d Dept 2016), and Giordano v Zepp, 163 AD3d 781 (2d Dept 2018), the court reiterates the modern Second Department statement of the Dram Shop standard:

“To establish a cause of action under the Dram Shop Act, a plaintiff is required to prove that the defendant sold alcohol to a person who was visibly intoxicated and that the sale of that alcohol bore some reasonable or practical connection to the resulting damages.”

From this, two critical elements emerge:

Visible intoxication at the time of service. The plaintiff must prove the defendant sold or provided alcohol to a person who was visibly intoxicated—i.e., whose intoxication was or should have been apparent to a reasonable server.
Reasonable or practical causal connection. The plaintiff must show that this unlawful sale had a reasonable or practical connection to the plaintiff’s injuries—often framed as a causation standard somewhat less demanding than strict “proximate cause,” but still requiring a real, not merely speculative, link between the service of alcohol and the injury.

The court then states the corresponding rule for summary judgment motions by defendants under the Dram Shop Act:

“[F]or a defendant to establish its prima facie entitlement to judgment as a matter of law dismissing a cause of action under the Dram Shop Act, it is required to establish either that it did not serve alcohol to the person while he or she was visibly intoxicated or that its sale of alcohol to him or her had no reasonable or practical connection to the resulting damages.” (Citing Flynn and Giordano.)

2. Precedents Shaping the Court’s Approach

Flynn v Bulldogs Run Corp., 171 AD3d 1136.
In Flynn, the Second Department emphasized that a bar seeking summary judgment under the Dram Shop Act must present affirmative evidence that it did not serve a visibly intoxicated patron, or that the service did not cause the harm. Conclusory denials or self-serving testimony are often insufficient where there is other evidence suggesting obvious intoxication or heavy drinking. Shepherd explicitly adopts the same framework.
Pinilla v City of New York, 136 AD3d 774.
Pinilla likewise sets out the two core elements—visible intoxication and causal connection. It reinforces that Dram Shop liability is not automatic upon proving intoxication; the plaintiff must also link the unlawful service to the injury.
Giordano v Zepp, 163 AD3d 781.
Giordano similarly articulates the standard for both establishing and defeating a Dram Shop claim on summary judgment, emphasizing the defendant’s burden in making a prima facie showing of no visible intoxication or no causal connection.
Filc v 221 Someplace Else, Ltd., 219 AD3d 1487.
The Second Department cites Filc both on the Dram Shop element (at 1488) and on premises-duty boundaries (at 1489). Filc, decided shortly before Shepherd, highlighted that in moving for summary judgment, a bar cannot defeat a Dram Shop claim by attacking the sufficiency of the plaintiff’s evidence alone; it must substantively negate an element of the claim. Shepherd follows this approach.
Aguilar v Reback, 226 AD3d 631.
Cited for the general proposition that a summary judgment movant “cannot sustain its burden by pointing to gaps in the plaintiff’s proof”. This is a long-standing New York rule; a defendant cannot win simply by arguing that the plaintiff has not yet produced enough evidence—the defendant must affirmatively negate a material element.

3. Application to Gallo’s Summary Judgment Motion

Against that backdrop, the panel holds that Gallo “failed to establish its prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging a violation of the Dram Shop Act.”

Critically:

Gallo did not affirmatively demonstrate that it did not serve alcohol to a visibly intoxicated patron, nor did it show that any sale lacked a reasonable or practical connection to Shepherd’s assault.
Instead, Gallo appears to have argued that the plaintiff lacked sufficient proof—i.e., it tried to exploit “gaps” in Shepherd’s evidence.

The Second Department rejects that approach outright, invoking Aguilar:

“Gallo cannot sustain its burden by pointing to gaps in the plaintiff's proof.”

Consequently, the court never reaches the sufficiency of Shepherd’s opposing evidence. Because Gallo failed to meet its initial burden on summary judgment, the motion to dismiss the Dram Shop claim was properly denied without regard to the plaintiff’s opposition.

4. Doctrinal Significance on Dram Shop Motions

The decision reinforces a tight, plaintiff-friendly structure for Dram Shop summary judgment:

A vendor of alcohol must affirmatively negate visible intoxication or causal connection to win on summary judgment.
Self-serving testimony alone (e.g., “I saw no signs of intoxication”) may often be insufficient where circumstances suggest substantial drinking or intoxication; though the opinion does not detail the facts, its citation to Filc and Flynn suggests this evidentiary rigor.
Defendants are prohibited from relying purely on the plaintiff’s evidentiary gaps to obtain dismissal; they must present affirmative, admissible proof.

Functionally, this means that in cases like Shepherd, where the alleged assault occurs off the premises and the negligence route is closed (as discussed below), the Dram Shop Act may remain the only viable avenue for the plaintiff. The Second Department’s framework ensures that such statutory claims cannot be easily eliminated at the summary judgment stage by technical attacks on the plaintiff’s proof.

B. The Negligence Claim Against Gallo: Premises Liability and Off‑Premises Assaults

1. General Duty: Landowner’s Obligation to Control Third Persons

The court begins its negligence analysis with a basic tort principle:

“A cause of action alleging negligence must be founded upon a breach by a defendant of a legal duty owed to a plaintiff.”

Citing Stenson v Genting N.Y., LLC, 185 AD3d 864 (2d Dept 2020) and Garda v Paramount Theatre, LLC, 145 AD3d 964 (2d Dept 2016), the panel reiterates the established rule that landowners may have a duty to protect patrons from the conduct of third parties under certain circumstances:

Landowners “have a duty to control the conduct of third persons on their premises when they have the opportunity to control such persons and are reasonably aware of the need for such control” (quoting Covelli v Silver Fist, Ltd., 167 AD3d 980, 980 [2d Dept 2018]).

Under this rationale, a bar or restaurant can be held liable in negligence for injuries caused by an intoxicated guest if:

The injury occurs on premises the defendant owns or controls (or in areas sufficiently under its control), and
The defendant had an opportunity to supervise or control the guest and was reasonably aware of the need to do so.

The court cites D'Amico v Christie, 71 NY2d 76 (1987), and again Filc at 1489 to emphasize that this duty is limited in space as well as in substance.

2. Territorial Limitation: Duty Only on Property or Areas Under Control

The Second Department crystallizes the spatial limitation on this duty with a clear rule:

“However, liability may be imposed only for injuries that occurred on a defendant's property, or in an area under the defendant's control, where the defendant had the opportunity to supervise the intoxicated guest and was reasonably aware of the need for such control.”

For this proposition, the panel relies on:

Filc v 221 Someplace Else, Ltd., 219 AD3d at 1489.
Covelli v Silver Fist, Ltd., 167 AD3d 980.
Ballo v AIMCO 2252‑2258 ACP, LLC, 155 AD3d 582 (1st Dept 2017).
Candelaria v Lake & Morningside Props., Inc., 71 AD3d 941 (2d Dept 2010).
White v Celebrity Lounge, 215 AD2d 650 (2d Dept 1995).
cf. Carver v P.J. Carney's, 103 AD3d 447 (1st Dept 2013) (distinguished situation where bar's actions may have created or exacerbated off‑premises risk).

Taken together, these cases draw a sharp boundary:

A bar or restaurant may have a common‑law duty to protect patrons from assaults on the premises or in areas it controls (e.g., its parking lot, entranceway, or other leased areas) where it can monitor and supervise.
But that duty generally does not extend to public areas outside its control—such as a public sidewalk or a municipal street—unless the defendant affirmatively creates or exacerbates a dangerous condition (e.g., forcibly ejecting an intoxicated person into the street, as in some Carver-type cases).

3. Application to the Sidewalk Assault in Shepherd

Applying this framework, the Second Department concludes:

“Here, Gallo established, prima facie, that the incident at issue occurred in an area outside of Gallo’s control and, therefore, that it owed no duty to the plaintiff to supervise or control individuals in that area.”

In other words, Gallo presented sufficient, uncontroverted evidence that:

The assault took place on a public sidewalk, not on Gallo’s property.
That sidewalk was not under Gallo’s ownership, leasehold, or control.

Once Gallo established this, the burden shifted to Shepherd to raise a triable issue of fact—e.g., by showing:

That the sidewalk was in fact under Gallo’s control (for example, through a license, lease, or exclusive use), or
That Gallo, through its own affirmative acts, created or exacerbated the risk on the sidewalk (similar to what the First Department considered in Carver—for instance, by throwing an intoxicated patron out onto the street in a dangerous condition).

The court holds that Shepherd failed to raise any such issue of fact. Accordingly, the negligence claim against Gallo was properly dismissed.

4. Relationship to D'Amico and Filc: Statutory vs Common-Law Duties

The juxtaposition of the Dram Shop claim (surviving) and the negligence claim (dismissed) would be puzzling if one assumed that statutory and common-law duties are coextensive. They are not.

As noted in D'Amico v Christie, the common law of negligence imposes no general duty on a bar or employer to monitor or control an intoxicated person once that person is off the premises and beyond the defendant’s practical ability to supervise. By contrast, the Dram Shop Act is a legislative imposition of statutory liability targeted at the unlawful sale of alcohol to a visibly intoxicated person, regardless of where the resulting injury occurs.

Filc and Shepherd together reinforce that:

A bar may escape common-law negligence liability if the injury occurs in an area outside its control, but
It may still face Dram Shop liability if it unlawfully served a visibly intoxicated person whose subsequent conduct caused injury—even if that injury occurs on a public sidewalk or roadway.

This decision thus underscores that statutory Dram Shop liability is broader geographically than the landowner’s common‑law premises duty, even though it is narrower in conduct (limited to unlawful sales of alcohol).

C. The Negligence Claim Against American: Third-Party Beneficiary and Contractual Duties

1. Plaintiff’s Theory: Third-Party Beneficiary of the Security Contract

Shepherd’s negligence theory against American was that American, as the contracted security company, owed him a duty of care because:

American had a contract with Gallo to provide security services at the restaurant.
As a patron and invitee, Shepherd claimed he was an intended third-party beneficiary of that contract; i.e., the contract was meant, in part, to protect patrons like him from physical harm.

If that were correct, Shepherd would argue that American’s failure to provide adequate security was a negligent breach of its duty to him.

2. The Third-Party Beneficiary Standard

The court again cites Rivera v Sodexo, Inc., 233 AD3d 721 (2d Dept), and Neurological Surgery, P.C. v Group Health Inc., 224 AD3d 697, to set out the modern, rigorous standard:

“[B]efore an injured party may recover as a third-party beneficiary for failure to perform a duty imposed by contract, it must clearly appear from the provisions of the contract that the parties thereto intended to confer a direct benefit on the alleged third-party beneficiary to protect him or her from physical injury.”

Key points:

The contract itself must make it clear that the parties intended to confer a direct benefit on the plaintiff (or a class of persons that includes the plaintiff).
General benefits flowing incidentally from performance of the contract—such as the fact that increased security might make patrons safer—are not enough.
The presumption is that contracts are made for the benefit of the contracting parties themselves, not for the public at large, unless the text clearly indicates otherwise.

The court also cites:

Garda v Paramount Theatre, LLC, 145 AD3d 964–965 (2d Dept 2016) – holding that a security company’s contract with a theater did not create a third-party beneficiary duty in favor of a patron.
Ramirez v Genovese, 117 AD3d 930, 931–932 (2d Dept 2014) – rejecting third-party beneficiary status where the contract did not show clear intent to benefit the injured party.

3. No Intended Third-Party Beneficiary Status for Shepherd

Applying these principles, the Second Department holds:

“Here, American established, prima facie, that it owed no contractual duty to protect the plaintiff, as the plaintiff was not an intended third-party beneficiary under American’s contract with Gallo.”

Although the text of the security contract is not reproduced in the opinion, the court’s conclusion indicates that:

The contract likely set out obligations solely between Gallo and American (e.g., number of guards, hours, scope of services),
And did not contain clear language stating that the contract was intended to protect patrons as a class or to confer on them direct rights of enforcement.

Therefore, Shepherd was at most an incidental beneficiary of the contract—i.e., someone who happened to benefit from its performance (if it were properly executed) but was not expressly meant to be protected under the contract terms.

4. Even If Beneficiary, Only Contract (Not Tort) Claims

The panel goes one step further:

“Moreover, even if the plaintiff were a third-party beneficiary of American’s contract with Gallo, American’s alleged failure to perform its obligations pursuant to the contract would give rise only to a cause of action alleging breach of contract.”

This is a critical doctrinal point. The court, again following Rivera, distinguishes:

Nonfeasance under a contract (failing to perform a contractual obligation at all), which ordinarily sounds in contract, from
Misfeasance creating an unreasonable risk of harm (e.g., actively creating a dangerous condition), which may sound in tort.

Where the alleged wrongdoing is simply that the contractor did not perform as promised (e.g., did not supply enough guards, did not patrol adequately), the remedy—even for an intended third-party beneficiary—is usually a contract claim, not negligence.

In Shepherd, the plaintiff apparently framed his case as a negligence action. The court makes clear that such alleged nonperformance by American, even if proven, would generate only a breach‑of‑contract claim, not a tort duty, and thus is not actionable in negligence.

5. Relationship to Broader Contractor-Duty Doctrine

New York law also contains a separate, but related, doctrine governing when a contractor owes a duty in tort to non-contracting third parties, often associated with Espinal v Melville Snow Contractors, Inc., 98 NY2d 136 (2002). While Espinal is not cited here, Shepherd is consistent with its core thrust:

Contractors generally owe no tort duty to non-contracting third parties unless they (a) launch a force or instrument of harm, (b) the third party detrimentally relies on the contractor’s continued performance, or (c) the contractor has entirely displaced the owner’s duty to maintain the premises safely.

In Shepherd, there is no indication that American created the hazardous condition or forcibly ejected a patron; rather, the complaint seems to allege inadequate supervision or prevention of the assault—i.e., nonfeasance. The panel’s emphasis on the absence of a contractual duty to protect Shepherd and its insistence that any claim would be contractual, not tort-based, aligns with this limited view of contractor tort duties.

Thus, American’s summary judgment win is doctrinally significant:

There is no tort duty from the security contractor to the patron absent clear contractual intent to benefit the patron and some tort-based misfeasance.
The path to recovery against such contractors—if any—usually lies in contract, not negligence, and even then only if the injured plaintiff is an intended third-party beneficiary.

D. The Contractual Indemnification Cross-Claim

1. Nature of Contractual Indemnification

Contractual indemnification arises when one party (the indemnitor) agrees to reimburse or defend another party (the indemnitee) against certain claims or losses. In New York:

Indemnity provisions are strictly construed; courts will not extend them beyond the clear language of the contract.
Many indemnity clauses limit coverage to losses “arising out of” the indemnitor’s work or negligence, or exclude indemnification for the indemnitee’s own negligence or statutory liability absent specific language.

Gallo’s cross‑claim sought to shift liability for Shepherd’s claims (including the Dram Shop claim) to American under their contract. After discovery, both sides moved for summary judgment on that cross-claim, in opposite directions:

Gallo sought judgment declaring American obliged to indemnify it.
American sought dismissal of the cross-claim, arguing no such obligation existed under the contract.

2. The Court’s Holding

The Second Department:

Affirmed the Supreme Court’s order denying Gallo’s motion for summary judgment on its contractual indemnification cross‑claim.
Affirmed the grant of American’s motion for summary judgment dismissing the cross‑claim.

Though the opinion does not elaborate on the contract’s specific language, the result necessarily means that:

Under the terms of the Gallo–American agreement, American was not obligated to indemnify Gallo against the type of liability alleged by Shepherd—particularly statutory Dram Shop liability and/or liability disconnected from any negligence by American.
The court found no triable issue of fact regarding the scope or interpretation of the indemnity provision; its application (or inapplicability) was clear as a matter of law.

More broadly, the result:

Prevents Gallo from shifting its statutory Dram Shop exposure to its security contractor in the absence of unmistakably clear contract language to that effect.
Signals that indemnity provisions will not be lightly read to encompass statutory liabilities arising from the bar’s own unlawful service of alcohol.

IV. Simplifying Key Legal Concepts

The opinion uses several technical concepts of New York law. The following simplified explanations may aid understanding.

1. Summary Judgment and Prima Facie Burden

Summary judgment is a procedure to resolve a case (or a claim) without a trial when there is no “genuine issue of material fact” and the moving party is entitled to judgment as a matter of law.
The moving party (here, Gallo and American) bears the initial prima facie burden—meaning it must present undisputed evidence that, if left unrebutted, would require judgment in its favor.
In New York, a defendant cannot meet this burden by arguing that the plaintiff’s evidence is weak or incomplete; it must affirmatively negate at least one essential element of the plaintiff’s claim.

2. Dram Shop Act (General Obligations Law § 11‑101)

The Dram Shop Act creates a statutory cause of action against those who unlawfully sell or furnish alcohol to a visibly intoxicated person (or to a minor), when that unlawful sale results in injury to a third person.
It is distinct from common-law negligence; it focuses on unlawful commercial sale of alcohol, not on general failure to supervise.
The plaintiff must show (1) visible intoxication at the time of the sale and (2) a reasonable or practical link between that sale and the injury.

3. Visible Intoxication

Visible intoxication does not require a blood-alcohol test; it is about observable signs—slurred speech, unsteady gait, glassy eyes, loud or inappropriate behavior—that would alert a reasonable server to the patron’s intoxication.
The focus is on what was (or should have been) apparent to the seller at the time of service, not merely that the person was intoxicated later.

4. Reasonable or Practical Connection (Causation)

The causal requirement under the Dram Shop Act is often phrased as a “reasonable or practical connection” between the unlawful sale and the injury.
This means the unlawful sale must contribute in a meaningful way to the circumstances leading to the injury—e.g., the intoxicated person, after being served, assaults someone or causes a car crash.
The connection need not be the sole cause, but it cannot be remote or purely speculative.

5. Duty of Landowners to Control Third Persons and “Area Under Control”

Landowners and business operators have a duty to maintain their premises in a reasonably safe condition and, in some circumstances, to control the conduct of third persons (such as intoxicated guests) on their premises.
This duty is limited to:
- The defendant’s property, and
- Areas under the defendant’s control (e.g., leased parking lots or entryways, or areas where the defendant has exclusive rights of use or control).
Public sidewalks or streets are usually under the control of the municipality, not the bar or restaurant—absent special circumstances.

6. Third-Party Beneficiary

A third-party beneficiary is a person who is not a party to a contract but is intended by the contracting parties to benefit directly from it—and may thus have rights to enforce it.
To qualify, it must “clearly appear” from the contract that:
- The contracting parties intended to confer a direct benefit on the third party (or a defined class of persons that includes the third party), and
- The benefit is not merely incidental.
Most service contracts (such as security, maintenance, or food services) benefit end users incidentally; they do not automatically make those end users intended third-party beneficiaries.

7. Contractual Indemnification

Contractual indemnification is an agreement where one party promises to reimburse or defend another party for specified losses or claims.
New York courts construe indemnity clauses narrowly, especially when they might be read to cover:
- The indemnitee’s own negligence; or
- Statutory liabilities, such as Dram Shop claims.
Absent clear contractual language, courts will not shift such liabilities to the indemnitor.

V. Impact and Broader Legal Significance

A. For Plaintiffs in Assault and Alcohol-Related Cases

Path narrowed for negligence, preserved for Dram Shop: Where an assault occurs on a public sidewalk or street adjacent to a bar or restaurant, common-law negligence theories based on premises liability are unlikely to succeed unless the plaintiff can show:
- The area was under the defendant’s control, or
- The defendant’s affirmative acts created or exacerbated the risk (e.g., violent ejection of a patron into a dangerous environment).
But Shepherd confirms that Dram Shop claims may still proceed if unlawful service to a visibly intoxicated person can be shown.
Increased scrutiny on proof of intoxication and service: Plaintiffs and their counsel must vigorously develop evidence on:
- How much and what was served.
- Witness observations of the patron’s behavior and demeanor.
- The time sequence between drinking, departure, and the assault.
However, Shepherd also protects plaintiffs by demanding that defendants seeking summary judgment affirmatively negate visible intoxication or causation, not simply criticize the plaintiff’s proof.
Limited direct recourse against security contractors in tort: Absent clear third-party beneficiary language and misfeasance that amounts to a tort, negligence claims against private security companies will be difficult to sustain. Plaintiffs may need to focus primarily on the premises owner and statutory dram shop theories, rather than attempting to expand tort duties of contractors.

B. For Bars, Restaurants, and Other Alcohol Vendors

Common-law duty is geographically limited—but statutory exposure is not.
- Shepherd confirms that a bar’s duty to control intoxicated guests for negligence purposes largely ends at the boundary of its premises and any areas it controls.
- However, the bar’s statutory Dram Shop liability may still attach for off-premises injuries, including assaults or vehicle collisions occurring on public sidewalks or roadways.
Training and policies are crucial.
- Staff training on recognizing visible intoxication and refusing service is essential not only for compliance with ABC Law § 65(2) but also to minimize Dram Shop exposure.
- Incident documentation (e.g., refusal to serve, removal of visibly intoxicated guests) can be critical evidence in later litigation.
Indemnity and risk transfer have limits.
- Security contracts and other service agreements may not shift statutory liabilities (like Dram Shop claims) to contractors unless drafted with unusual clarity.
- Shepherd serves as a warning that bars cannot assume their security provider will bear ultimate responsibility for patron-on-patron assaults, especially where the core liability arises from unlawful service of alcohol, not security misfeasance.

C. For Security Contractors and Service Providers

Contract drafting matters.
- To avoid unintended tort exposure, security contracts often contain disclaimers that they do not create rights in third parties (such as patrons or invitees) and are not intended to make them beneficiaries.
- Shepherd validates the effectiveness of such drafting: absent clear intent to benefit patrons, there is no duty owed to them as third-party beneficiaries.
Acceptance of indemnity obligations should be deliberate and limited.
- Contractors must carefully negotiate and limit indemnification clauses, particularly those that could be read to cover the premises owner’s own statutory or negligent acts.
- Shepherd suggests that courts will not read indemnity clauses broadly to require security contractors to absorb a bar’s Dram Shop liability.

D. For Trial Courts and Appellate Practice

Reinforcement of the summary judgment burden.
- The opinion fortifies the rule, reiterated in Aguilar v Reback, that a defendant cannot win summary judgment by identifying deficiencies in the plaintiff’s proof alone.
- This is especially important in Dram Shop and premises-liability cases, where the defendant is often in possession of much of the relevant evidence (e.g., staff testimony, surveillance footage, incident reports).
Clarity on dual tracks: statutory vs common-law liability.
- Shepherd, following Filc and D'Amico, provides a clear template: a common-law negligence duty is territorially limited, while statutory Dram Shop liability reaches beyond property boundaries so long as the statutory elements are met.

VI. Conclusion

Shepherd v. Gallo Restaurant of Patchogue, LLC is a significant Second Department decision that clarifies and reinforces several important strands of New York tort and statutory liability law:

Dram Shop liability: A bar or restaurant seeking summary judgment on a Dram Shop claim must affirmatively show that it did not serve a visibly intoxicated person, or that its service had no reasonable or practical connection to the injury. It cannot merely point to gaps in the plaintiff’s proof.
Premises liability boundaries: The common-law duty of a landowner to control intoxicated patrons and protect others from their conduct is confined to the defendant’s property and areas under its control. Injuries on adjacent public sidewalks are generally outside this duty, absent special circumstances.
Security contractor duties: Security companies contracted by a premises owner do not, without clear contractual intent, owe a tort duty to patrons as third-party beneficiaries. Even where such beneficiaries exist, failures to perform contractual obligations typically sound in contract, not in negligence.
Contractual indemnification: Indemnity provisions will not readily be interpreted to shift a bar’s own statutory Dram Shop exposure to its security contractor in the absence of unmistakable contractual language.

The combined effect of these holdings is a nuanced allocation of responsibility:

The bar retains primary statutory responsibility for unlawful alcohol service, even when injuries occur off premises.
Its common-law negligence duties are limited geographically and do not turn the bar into an insurer of public safety on adjacent sidewalks.
Security contractors are shielded from broad tort duties to patrons, and from expansive indemnity obligations, unless the contract clearly provides otherwise.

In this way, Shepherd refines the legal architecture governing nightlife-related injuries in New York: it preserves the deterrent and compensatory force of the Dram Shop Act, while keeping common-law and contractual duties within carefully drawn boundaries.