Opinion
10284-10284A Index 651657/17
11-07-2019
ATLAS MF MEZZANINE BORROWER, LLC, etc., Plaintiff-Respondent, v. MACQUARIE TEXAS LOAN HOLDER LLC, etc., Defendant, KKR REPA AIV-2 L.P., etc., et al., Defendants-Appellants.
Quinn Emanuel Urquhart & Sullivan LLP, New York (Sanford I. Weisburst of counsel), for appellants. Meister Seelig & Fein, New York (Stephen B. Meister of counsel), for respondent.
Quinn Emanuel Urquhart & Sullivan LLP, New York (Sanford I. Weisburst of counsel), for appellants.
Meister Seelig & Fein, New York (Stephen B. Meister of counsel), for respondent.
Richter, J.P., Webber, Gesmer, Oing, JJ.
Orders, Supreme Court, New York County (Charles E. Ramos, J.), entered November 14 and 23, 2018, which, inter alia, granted plaintiff's motion to dismiss defendants-respondents' (defendants) counterclaim for fraud, unanimously affirmed, with costs.
Plaintiff's statement that its required deposit check was "on its way" was an actionable statement of present fact, not of future expectation (cf. GE Oil & Gas, Inc. v. Turbine Generation Servs., L.L.C. , 168 A.D.3d 563, 564, 93 N.Y.S.3d 5 [1st Dept. 2019] ). However, defendants' allegations are insufficient to show reasonable reliance as a basis to continue bidding against plaintiff, where the fact that the check was not there was disclosed, the auctioneer disqualified plaintiff from bidding, and when the auctioneer later allowed bidding he stated that he was making "an exception" from the bidding procedures to allow plaintiff to bid ( ACA Fin. Guar. Corp. v. Goldman, Sachs & Co. , 25 N.Y.3d 1043, 1044, 10 N.Y.S.3d 486, 32 N.E.3d 921 [2015] [internal quotation marks omitted] ).
Nor do defendants' allegations that they reasonably relied on some implied representation about plaintiff's financial condition fare any better. By their own admission, defendants knew that plaintiff had defaulted on the underlying debt, that it had failed to tender the required deposit check for the auction, and that it was bidding more than the amount of the underlying debt. Based on this information, defendants ceased bidding some 15 minutes into the auction. Defendants do not allege they obtained any further information before making the decision to stop bidding. They had all the information necessary to determine that plaintiff likely did not have the ability to close.