On May 18, 2010, the New York State Supreme Court, Appellate Division, First Department, affirmed a Manhattan trial court order entering partial summary judgment on behalf of the defendants, Ronald Gutfleish, Elm Ridge Capital Management, LLC (ERCM), Elm Ridge Value Advisors, LLC (ERVA), Elm Ridge Partners, LLC (ERP) and Elm Ridge Management, LLC (ERM), in a separation agreement fee dispute with a former manager, Douglas DiPasquale, the plaintiff.  DiPasquale had resigned as co-managing member of ERCM and ERVA, two firms that advised and managed three hedge funds controlled by Gutfleish, in exchange for a share of future profits from ERCM and ERVA.  Following DiPasquale’s resignation, Gutfleish created ERP and ERM to replace ERVA and ERCM, and ceased payments to DiPasquale.  The New York State courts dismissed DiPasquale’s complaint to the extent that he sought damages from the defendants because they found the separation agreement authorized Gutfleish’s actions.  We detail the background of the action and the courts’ legal analysis.