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Lawsuit Alleging Lehman Brothers’ Substitution of Toxic Securities for High Value Securities Can Go Forward

In a full-fledged opinion by Justice Saxe, the First Department determined plaintiff Aetna Life Insurance Company had sufficiently alleged causes of action stemming from Lehman Brothers’ alleged removal of high-grade securities from a trust account and replacement of those securities with toxic subprime-mortgage-backed securities. The First Department summarized the facts and its rulings as follows:

Aetna asserts that defendants [replaced the high value securities with toxic securities] as part of an effort to prop up Lehman Brothers’ financial position in the final days prior to its 2008 collapse. The complaint alleges causes of action for breach of the Connecticut Unfair Trade Practices Act (CUTPA) (Conn Gen Stat § 42-110b[a] et seq.); breach of fiduciary duty; negligence; and recklessness. We affirm the determination of the motion court holding that the allegations are sufficient to support each of the causes of action, and modify only to the extent of denying dismissal of the negligence claims against the individual defendants.  Aetna Life Ins Co v Appalachian Asset Mgt Corp, 2013 NY Slip Op 05506, 1st Dept 7-30-13

 

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QUESTION OF FACT WHETHER GROSS NEGLIGENCE MIGHT OVERCOME A CONTRACTUAL LIMITATION ON LIABILITY (FIRST DEPT).
DEFENDANT SUFFICIENTLY DEMONSTRATED A PLEA WHICH WOULD NOT RESULT IN MANDATORY DEPORTATION COULD HAVE BEEN WORKED OUT; THE MOTION TO VACATE HIS CONVICTION ON INEFFECTIVE ASSISTANCE OF COUNSEL GROUNDS SHOULD NOT HAVE BEEN DENIED WITHOUT A HEARING (FIRST DEPT).
SCAFFOLD TIPPED PINNING PLAINTIFF’S HAND AGAINST A WALL; SPECULATIVE EVIDENCE DID NOT RAISE A QUESTION OF FACT ABOUT PLAINTIFF’S ACTIONS BEING THE SOLE PROXIMATE CAUSE; PLAINTIFF WAS ENTITLED TO SUMMARY JUDGMENT ON HIS LABOR LAW 240 (1) CAUSE OF ACTION (FIRST DEPT).
PLAINTIFF, WHO FELL FROM AN UNSECURED LADDER, WAS ENTITLED TO SUMMARY JUDGMENT ON HIS LABOR LAW 240(1) CLAIM, THERE WAS A QUESTION OF FACT ON THE LABOR LAW 241(6) CAUSE OF ACTION WHICH ALLEGED THE LADDER SLIPPED ON A WET FLOOR (FIRST DEPT).
DEFENDANT’S CONVICTION SUPPORTED BY THE WEIGHT OF THE EVIDENCE, DETAILED DISCUSSION OF THE WEIGHT OF THE EVIDENCE ANALYSIS, DISSENT DISAGREED (FIRST DEPT).
SUIT ALLEGING BREACH OF FIDUCIARY DUTY IN CONNECTION WITH THE SALE OF AN ASSET OWNED NEARLY ENTIRELY BY BANKRUPT LEHMAN BROTHERS DISMISSED.
A MARRIAGE WITHOUT FIRST OBTAINING A MARRIAGE LICENSE WILL BE DEEMED VALID IN NEW YORK IF THE MARRIAGE IS “SOLEMNIZED;” HERE THE CEREMONY PERFORMED BY THE COPTIC ORTHODOX CHURCH WAS DEEMED A “FAMILY BLESSING,” NOT A “MARRIAGE,” BECAUSE THE “SOLEMNIZATION” REQUIREMENTS WERE NOT MET (FIRST DEPT).

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