Denise Cote

This case arose from the 2007 merger of Lyondell Chemical Company and Basell, after which the combined entity filed for bankruptcy in 2009; a litigation trustee then brought twenty-one claims under bankruptcy, state, Delaware, and Luxembourg law against various individuals and entities involved in the merger, alleging fraudulent transfers, breaches of fiduciary duty, and related misconduct. Defendants moved to withdraw the reference of the adversary proceeding from the bankruptcy court to the district court under 28 U.S.C. § 157(d) and Stern v. Marshall. The district court denied the motions, holding that the bankruptcy court retained authority over the core claims and that withdrawal was not required for the non-core claims.

business & regulatoryprocedure

RFP LLC sued SCVNGR, Inc. under the Lanham Act and New York law, alleging trademark infringement and related claims over SCVNGR's use of the 'Race for the Rock' mark for scavenger hunt contests offering an engagement ring as a prize. SCVNGR filed counterclaims against RFP and its president for tortious interference with a business relationship and deceptive acts under New York General Business Law § 349, based on cease-and-desist letters sent to SCVNGR and its partner Bremer. The court granted the motion to dismiss these counterclaims. It found that SCVNGR failed to adequately allege wrongful purpose or means or resulting injury for the tortious interference claim. For the § 349 claim, the court held there were insufficient allegations of deceptive conduct affecting New York consumers.

business & regulatorytorts & liability

The case involved Sergey Aleynikov, a former Goldman Sachs computer programmer, who was charged with stealing the firm's proprietary high-frequency trading source code near the end of his employment to use at his new job with Teza Technologies. A jury convicted Aleynikov on two counts after a trial, and he moved under Federal Rules of Criminal Procedure 29 and 33 to set aside the verdict, dismiss the indictment, or obtain a new trial. The district court denied the motions in full, holding that the evidence was sufficient to establish Aleynikov's intent to steal the code, to benefit himself or Teza, and to injure Goldman Sachs, as well as that the trading system was a product in interstate commerce and that the stolen source code qualified as a good, ware, or merchandise. The court also upheld its evidentiary rulings, discovery decisions, and handling of the summation and courtroom closure, finding no basis to disturb the verdict.

criminal lawprocedurebusiness & regulatory

The case concerned trustees of union benefit funds suing a construction company under ERISA for unpaid contributions to welfare, pension, annuity, and related trusts required by a collective bargaining agreement with Local 282. The defendant had hired an outside trucking firm, Jo-Di, for hauling on a prevailing-wage project without notifying the union or funds, and the plaintiffs sought to recover contributions based on the hours worked by Jo-Di drivers. The court granted the plaintiffs' motion for summary judgment, awarding the unpaid contributions plus interest, fees, and damages. It reasoned that the CBA required the employer to ensure outside suppliers provided equivalent wages and benefits, placed responsibility on the employer for noncompliance after notice, and obligated reporting of such hires; the defendant failed to meet these conditions, making it liable for the contributions attributable to the subcontracted work.

labor & employmentbusiness & regulatory

The case concerned a shipment of thin-walled steel pipes purchased by Ferrostaal and transported by sea from Shanghai to New Orleans in 2006, which arrived damaged allegedly due to improper stowage. After a bench trial, the court held the vessel M/V Akili liable in rem under COGSA for the cargo damage but dismissed personal liability claims against the vessel's owner Akela and manager Ami. The core reasoning was that COGSA applied to the carriage via the bill of lading and charter terms, the evidence showed the pipes were inadequately secured causing damage, and the owners and manager were not carriers under the relevant agreements even though the vessel itself remained subject to in rem liability.

business & regulatorytorts & liability

This case concerns DMX, a provider of background and foreground music services, which sought a through-to-the-audience blanket license from ASCAP for public performance rights, adjusted to reflect direct licenses DMX had already obtained or planned to obtain from music publishers. Unable to agree on terms, the parties asked the court under ASCAP's antitrust consent judgment to set a reasonable rate. The court evaluated ASCAP's proposals for a flat-fee blanket license or one with a static carve-out, as well as DMX's proposal for a blanket fee consisting of a floor component plus an unbundled music fee derived from direct-license benchmarks. It concluded that DMX's structure was reasonable and supported by evidence from existing agreements, including those with Sony and other publishers, while ASCAP's alternatives did not adequately account for the direct licensing program.

business & regulatory

This case arose from Tyco's suit against its former outside director Walsh, alleging breach of fiduciary duty for failing to disclose a $20 million finder's fee paid by Tyco's CEO in connection with Tyco's acquisition of CIT Group. Walsh had returned the fee after pleading guilty to a Martin Act violation, but Tyco sought interest plus consequential and punitive damages. After a bench trial, the court found that Walsh breached his fiduciary duty by not timely disclosing the payment to the board. However, the court concluded that Tyco's board implicitly ratified the payment through its public actions and statements following disclosure, and that Bermuda law barred punitive damages.

business & regulatoryprocedure

This case concerns a former Goldman Sachs vice president charged in a three-count indictment with theft of trade secrets under 18 U.S.C. § 1832, interstate transportation of stolen property under 18 U.S.C. § 2314, and unauthorized computer access under 18 U.S.C. § 1030 after he allegedly copied and transferred hundreds of thousands of lines of proprietary source code for Goldman's high-frequency trading system to an external server and then to a competitor. The defendant moved to dismiss the indictment under Fed. R. Crim. P. 12(b)(3)(B) for failure to state an offense. The court granted the motion in part, holding that the transportation count failed because the source code constituted intangible intellectual property rather than tangible goods, wares, or merchandise within the meaning of the statute, and that the computer access count failed because the defendant had authorization to access the system even if he later misused the information obtained.

criminal lawprocedurebusiness & regulatory

This case arose from construction delays and extra work on a Baruch College campus project, where surety Travelers sued owner DASNY on behalf of prime contractor Trataros and its subcontractors for impact claims, bond losses, and related damages under two prime contracts that included no-damages-for-delay clauses, while DASNY counterclaimed for breach of contract and the performance and payment bonds. On cross-motions for summary judgment, the court granted DASNY's motion in full and Travelers' motion only in part. The core reasoning addressed New York law on the enforceability of no-damages-for-delay provisions and their exceptions, the viability of subcontractors' pass-through claims, equitable subrogation and obligee standing under payment bonds, and whether the undisputed facts established breaches or waiver.

business & regulatoryprocedure

This case arose from the construction of a Baruch College campus building, where Travelers Casualty & Surety Co., as subrogee to prime contractor Trataros, sued architect KPF and construction manager TDX for economic losses and fees allegedly caused by their negligent performance of contractual duties on the project. KPF and TDX moved for summary judgment to dismiss the claims. The court granted both motions, holding that the defendants owed no tort duty of care to Trataros for purely economic damages under New York law because the parties' relationships were defined by contracts, there was no privity or intended reliance sufficient to support negligence claims, and construction professionals are not liable in tort to non-contracting parties absent special circumstances. The decision rested on precedents limiting tort recovery for economic loss in contractual settings without direct duties.

torts & liabilitybusiness & regulatoryprocedure

In In re Plumeri, a bankruptcy debtor and her attorney appealed an order from the bankruptcy court that imposed sanctions on the attorney and awarded attorney’s fees to the landlord. The sanctions stemmed from the attorney’s failure to disclose on the bankruptcy petition, as required by 11 U.S.C. § 362(l)(5), that the landlord had obtained a pre-petition judgment of possession for the debtor’s apartment. The district court affirmed the bankruptcy court’s order. The court explained that the attorney knew of the judgment yet omitted the required disclosure and certification that could have briefly stayed eviction proceedings under § 362(l), and that the attorney’s stated reasons for the omission did not amount to excusable neglect or other justification.

procedure

This case arose from the construction of a building for Baruch College, where third-party defendant Trataros and its subcontractor Bartec were accused of defective installation of an epoxy terrazzo flooring system. Travelers Casualty and Surety Company, as administrator for Reliance Insurance and asserting claims assigned by Trataros, sued to obtain a declaration that Trataros qualified as an additional insured under commercial general liability policies issued to Bartec by Assurance, Harleysville, and Ohio Casualty. The insurers moved for summary judgment seeking dismissal of the coverage claims. The court granted the motions, concluding that policy exclusions for damage to the insured's own work and limitations on the policy period barred coverage for the claimed losses.

business & regulatorypropertyproceduretorts & liability

This case consists of three bankruptcy appeals arising from contracts for a 2004 Mike Tyson boxing match promoted in part by a Gibraltar shell company called Brearly. The Bankruptcy Court pierced Brearly's corporate veil under English law and held British promoters Warren and Simons personally liable for Brearly's breaches of agreements with Tyson and Straight-Out Promotions. The District Court reversed the veil-piercing ruling, vacated the judgment in part, and remanded for further proceedings, concluding that English law did not permit holding the individuals liable in this manner.

business & regulatoryprocedure

The case involves a declaratory judgment action filed by Children's Network (Sprout) and related Comcast entities in the Southern District of New York, seeking rulings that two patents assigned to PixFusion are invalid and that certain photo-personalized applications on the Sprout website do not infringe them. PixFusion moved to transfer the action to the Eastern District of Texas, where it had separately filed a patent infringement suit against multiple defendants including the plaintiffs. The court denied the transfer motion, finding that the convenience of the parties and witnesses, location of documents and evidence, and overall interest of justice weighed heavily against transfer, as nearly all relevant parties, employees, and records were located in or near New York or Philadelphia with no meaningful connection to Texas.

procedure

This case involves Quantlab Financial, LLC and its affiliate Quantlab Technologies Ltd. (BVI) suing Tower Research Capital, LLC to prevent Tower from hiring former Quantlab employee Dr. Yongzhong Xu, based on an alleged non-compete agreement that Xu disputes signing. After filing, the court raised concerns about diversity jurisdiction and ordered briefing; plaintiffs amended the complaint to add QLT as a plaintiff and sought to drop QLF. The court granted the request to drop QLF to maintain diversity jurisdiction, denied Tower's motion to dismiss for failure to join Xu as an indispensable party because he could now be added without destroying diversity, and denied vacating the temporary restraining order against Xu's employment at Tower.

business & regulatoryprocedurelabor & employment

In this case, three employees sued their employer, Tishman Speyer, alleging workplace harassment and retaliation based on sex and national origin under Title VII, the New York State Human Rights Law, and the New York City Human Rights Law. The employer moved to dismiss the complaint for lack of jurisdiction and to compel arbitration under the Federal Arbitration Act, citing a collective bargaining agreement between the employer and the employees' union that designated arbitration as the sole remedy for discrimination claims. The district court granted the motion in part, finding that the CBA's arbitration provisions, as supplemented by a later agreement allowing individual employees to pursue claims when the union declines, validly covered both the discrimination and retaliation claims and were enforceable under the FAA's policy favoring arbitration. The court therefore stayed the federal action pending arbitration rather than dismissing it outright.

labor & employmentcivil rights

This case concerned MobiTV's request for a through-to-the-audience blanket license from ASCAP to authorize the public performance of music in television programming delivered to mobile handsets through wireless carriers. Acting as rate court under ASCAP's longstanding antitrust consent decree, the district court was required to set a reasonable licensing fee after the parties could not agree on terms. The principal disputes involved the proper revenue base for calculating the fee—whether retail revenues received by wireless carriers or amounts paid by MobiTV to content providers—and the percentage rates to apply to that base. The court examined comparable licenses, including ASCAP's Post-Turner agreements with cable operators and music video services, to determine fair market value while ensuring the rate compensated composers for their contributions without creating market distortions.

business & regulatory

This case was a securities fraud class action lawsuit brought against Australia & New Zealand Banking Group Ltd. and certain officers, alleging violations of Exchange Act Sections 10(b) and 20(a) based on misleading public statements about the company's financial condition and risks from its lending relationship with Opes Prime Group. The district court had previously dismissed the action for failure to state a claim. In this opinion, issued pursuant to the PSLRA's requirement for Rule 11 findings after final adjudication, the court imposed sanctions on plaintiffs' counsel for a substantial violation in the original complaint, which falsely alleged the existence of March 2007 internal emails showing defendants' knowledge of Opes Prime's financial difficulties when the emails were actually from 2008 after the receivership. The core reasoning was that this key factual assertion, central to pleading scienter, was included without reasonable inquiry and constituted a substantial Rule 11 violation warranting mandatory sanctions, despite the later filing of an amended complaint.

business & regulatoryprocedure

This case involves a homeowner who sued his mortgage servicer for refusing to allow early cancellation of private mortgage insurance (PMI) on his Fannie Mae-insured loan and for allegedly inadequate disclosures about his cancellation rights. The plaintiff asserted claims under New York's Deceptive Trade Practices Act, breach of contract, and breach of the implied covenant of good faith and fair dealing, arguing that the servicer was bound by terms in the Fannie Mae Servicing Guide that he claimed were incorporated into his mortgage contract. The court granted the defendant's motion to dismiss the amended complaint. It held that the DTPA claim was expressly preempted by the federal Homeowners Protection Act of 1998, which sets the standards for PMI cancellation and disclosures, and that the plaintiff failed to plead facts showing any violation of the mortgage terms or incorporation of the Servicing Guide. The court reasoned that the mortgage contract itself references the HPA as governing PMI rights and that the servicer complied with both federal law and the Guide's requirements for cancellation eligibility based on loan-to-value ratios and mortgage age.

business & regulatoryproperty

This case concerned a shareholder's derivative and class action lawsuit against a mutual fund (the Ultra Fund, part of ACMF), its investment advisers, and directors for investing millions in shares of PartyGaming, an online gambling company, which allegedly violated RICO and state laws on fiduciary duty, negligence, and waste after the investments declined following U.S. enforcement actions against illegal gambling. The court had previously dismissed the RICO claims for failure to plead proximate causation, and it granted the motions to dismiss the remaining state-law claims. The core reasoning was that the action was derivative under Maryland law, requiring a pre-suit demand on the board or a showing of futility, but the plaintiff's allegations did not create reasonable doubt about the directors' independence or show a substantial likelihood of personal liability, as the investments fell within the business judgment rule and general conflicts from the adviser's role did not suffice.

business & regulatorycriminal lawprocedure