On this issue, the Court must look once again to the principles underlying the New York common law of in pari delicto as outlined in Kirschner and other decisions. New York courts prior to Kirschner applied in pari delicto where the plaintiff had displayed "immoral or unconscionable conduct that makes the wrongdoing of the party against which it is asserted at least equal to that of the party asserting it," Chem Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 (N.Y.App.Div. 1st Dept.1997), or "resorted to gravely immoral and illegal conduct." McConnell v. Commonwealth Pictures Corp., 7 N.Y.2d 465, 471, 199 N.Y.S.2d 483, 166 N.E.2d 494 (N.Y.1960).

"An owner can seek indemnity for asbestos clean-up from a party wholly responsible for the wrongdoing." Chem. Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 (1997) (citing City of N.Y. v. Keene Corp., 132 Misc.2d 745, 505 N.Y.S.2d 782 (Sup. Ct. 1986), aff'd, 129 A.D.2d 1019, 513 N.Y.S.2d 1004 (1987)). True indemnity claims (like true restitution claims) arise from a quasi-contractual obligation of a defendant to a plaintiff where the plaintiff has expended resources to remedy harm on behalf of third parties which expenses should have properly been borne by defendant.

Aetna Cas. & Sur. Co. v. Aniero Concrete Co., Inc., 404 F.3d 566, 607 (2d Cir.2005) (adopting the District Court's decision holding, inter alia, that defendant may not "avail itself of the unclean hands as a defense" because plaintiff was seeking "damages in an action at law"); Chevron Corp. v. Salazar , Nos. 11 cv 3718, 11 cv 0691(LAK), 2011 WL 3628843, at *6 n. 39 (S.D.N.Y. Aug. 17, 2011) (collecting cases). However, unclean hands finds its legal counterpart in the doctrine of in pari delicto,Byron v. Clay, 867 F.2d 1049, 1052 (7th Cir.1989) (Posner, J.); see Kirschner v. KPMG LLP, 15 N.Y.3d 446, 912 N.Y.S.2d 508, 938 N.E.2d 941, 960 (2010) (noting the "doctrinal similarity" between the defense of unclean hands and in pari delicto ) (citing Chem. Bank v. Stahl , 237 A.D.2d 231, 655 N.Y.S.2d 24, 25 (1997) ), which "instructs courts to refrain from intervening in a dispute between two parties at equal fault." Id. . at 961.

Further, "[a]n agreement which is 'lawful on its face and which does not contemplate or necessarily entail unlawful conduct in its performance is enforcible by the promisee even though he engages in unlawful activity in the agreement's performance,' provided the promisee does not require the aid of the illegal transaction to make out his case." Chemical Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24, 25 (N.Y. App. Div. 1997).

Lead Industries III, 222 A.D.2d at 125, 644 N.Y.S.2d 919. “An owner can seek indemnity for asbestos clean-up from a party wholly responsible for the wrongdoing.” Chemical Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 (N.Y.App.Div.1997) (citing City of New York v. Keene Corp., 132 Misc.2d 745, 505 N.Y.S.2d 782, aff'd, 129 A.D.2d 1019, 513 N.Y.S.2d 1004 (N.Y.App.Div.1987)). In evaluating this motion to disallow a claim, this Court must accept the facts as alleged by Claimant.

The propriety of securing by contract indemnity against the financial burden resulting from breach of even a nondelegable duty is also widely acknowledged in other jurisdictions, in a variety of contexts. See, e.g., Robinson v. Shapiro, 646 F.2d 734, 739 (2d Cir. 1981) (nondelegable duty under state labor law); Sequa Coatings Corp. v. N. Ind. Commuter Tramp. Dist, 796 N.E.2d 1216, 1225 (Ind.Ct.App. 2003) (nondelegable duties imposed on common carrier), aff'd on reh'g, 800 N.E.2d 926 (Ind.Ct.App. 2003); Chem. Bank v. Stahl, 237 A.D.2d 231, 655 N.Y.S.2d 24, 25 (N.Y.App.Div. 1997) (nondelegable duties imposed on landlord); W.M. Schlosser Co. v. Maryland Drywall Co., 673 A.2d 647, 653 n. 13 (D.C. 1996) (nondelegable duty to provide safe work place); De Los Santos v. Saddlehill, Inc., 211 N.J.Super. 253, 511 A.2d 721, 726 (N.J.Super.Ct.App.Div. 1986) (nondelegable duties imposed on landlord); Dykstra v. Arthur G. McKee Co., 100 Wis.2d 120, 301 N.W.2d 201, 206-07 (1981) (nondelegable duties imposed by state safe-place statute).

On a pre-answer motion to dismiss, a court must take as true the allegations of the complaint and give the plaintiff the benefit of every favorable inference that may be drawn from the complaint or from submissions in opposition to the motion ( see Matter of Graziano v County of Albany, 3 NY3d 475, 481; 511 W 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144, 152; Prudential-Bache Sec. v Citibank, 73 NY2d 263, 266). Where complex, fact-based issues abound, pre-answer dismissal should be an exception, not the rule ( see e.g. Morgado Family Partners, LP v Lipper, 19 AD3d 262, 263 [1st Dept 2005]; see also In re Adelphia CommunicationsCorp., 365 BR 24, 33 [Bankr SD NY 2007] ["issue is not whether a (claim) will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims"]; Stahl v Chemical Bank, 237 AD2d 231, 231 [1st Dept 1997] [defense of "unclean hands (which is doctrinally similar to in pari delicto) . . . raises issues that require factual exploration"]). The majority, however, is willing to allow dismissal of the complaints at this early stage of litigation based on agency principles and public policy, effectively creating a per se rule that fraudulent insider conduct bars any actions against outside professionals by derivative plaintiffs or litigation trustees for complicitous assistance to the corrupt insider or negligent failure to detect the wrongdoing.

Under the doctrine, which operates under agency principles, "the acts of a corporation's authorized agents, such as its officers, are imputed to the corporation ‘even if [the] particular acts were unauthorized’ " (New Greenwich Litig. Trustee, LLC v. Citco Fund Servs. (Europe) B.V., 145 A.D.3d 16, 23, 41 N.Y.S.3d 1 [1st Dept.2016] [quoting Kirschner, 15 N.Y.3d at 465, 912 N.Y.S.2d 508, 938 N.E.2d 941 ] ). The doctrine "requires immoral or unconscionable conduct that makes the wrongdoing of the party against which it is asserted at least equal to that of the party asserting it" (Chemical Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 [1st Dept.1997] [citation omitted] ). Absent the application of an exception to the in pari delicto rule, Gerald's conduct, as an officer and director of GHC and New Roads, is imputed to the corporations.

Rather, the true focus of the in pari delicto doctrine is whether the defendant's wrongdoing is at least equal to that of the plaintiff's. Indeed, the case incompletely quoted by plaintiff actually provides that in pari delicto "requires immoral or unconscionable conduct that makes the wrongdoing of the party against which it is asserted at least equal to that of the party asserting it" (Stahl v Chemical Bank, 237 AD2d 231, 232 [1st Dept 1997]). The Court of Appeals, in Kirschner, further expounded that "[t]he doctrine's full name is in pari delicto potior est conditio defendentis, meaning [i]n a case of equal or mutual fault, the position of the [defending party] is the better one'" (15 NY3d at 464 n 4 [internal citation omitted]).

Rather, the true focus of the in pari delicto doctrine is whether the defendant's wrongdoing is at least equal to that of the plaintiff's. Indeed, the case incompletely quoted by plaintiff actually provides that in pari delicto “requires immoral or unconscionable conduct that makes the wrongdoing of the party against which it is asserted at least equal to that of the party asserting it” (Stahl v. Chemical Bank, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 [1st Dept.1997] ). The Court of Appeals, in Kirschner, further expounded that “[t]he doctrine's full name is in pari delicto potior est conditio defendentis, meaning ‘[i]n a case of equal or mutual fault, the position of the [defending party] is the better one’ ” (15 N.Y.3d at 464 n. 4, 912 N.Y.S.2d 508, 938 N.E.2d 941 [internal citation omitted] ).