Shenzhen Qianhai Shengshi Shengjin Inv. Enter. (Limited Partnership) v Xu - 2026 NY Slip Op 04338
Shenzhen Qianhai Shengshi Shengjin Inv. Enter. (Limited Partnership) v Xu
2026 NY Slip Op 04338
July 8, 2026
Appellate Division, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This decision is uncorrected and subject to revision before publication in the Official Reports.
Shenzhen Qianhai Shengshi Shengjin Investment Enterprise (Limited Partnership), respondent,
v
Maodong Xu, et al., defendants, Fang Zhou, et al., appellants. (Appeal No. 1.)
Shenzhen Qianhai Shengshi Shengjin Investment Enterprise (Limited Partnership), respondent,
v
Maodong Xu, et al., appellants, et al., defendants. (Appeal No. 2.)
Supreme Court of the State of New York, Appellate Division, Second Judicial Department
Decided on July 8, 2026
2022-03274, 2022-03275, (Index No. 609960/20)
Valerie Brathwaite Nelson, J.P.
William G. Ford
Lillian Wan
Laurence L. Love, JJ.
Law Offices of Bing Li, LLC, New York, NY, for appellant Maodong Xu.
Wiggin and Dana LLP, New York, NY (Nathan E. Denning, Benjamin H. Diessel, Tadhg Dooley, and Michael L. Kenny, Jr., of counsel), for appellants Fang Zhou, FZ Irrevocable Trust, and Haohan Xu.
Port and Sava, Lynbrook, NY (George S. Sava of counsel), for respondent.
[*1]
DECISION & ORDER
In an action, inter alia, to enforce a foreign country money judgment, (1) the defendants Fang Zhou, FZ Irrevocable Trust, and Haohan Xu appeal from an order of the Supreme Court, Nassau County (Roy S. Mahon, J.), entered August 27, 2021, and (2) those defendants appeal, and the defendant Maodong Xu separately appeals, from an order of the same court entered October 18, 2021. The order entered August 27, 2021, granted the plaintiff's motion for an order of attachment and expedited discovery in aid of the attachment, denied the motion of the defendants Maodong Xu, Fang Zhou, FZ Irrevocable Trust, and Haohan Xu pursuant to CPLR 3211(a) to dismiss the amended complaint, and granted the plaintiff's cross-motion to enforce a foreign country money judgment. The order entered October 18, 2021, granted the plaintiff's motion for an order of attachment and expedited discovery in aid of the attachment, denied the motion of the defendants Maodong Xu, Fang Zhou, FZ Irrevocable Trust, and Haohan Xu pursuant to CPLR 3211(a) to dismiss the amended complaint, and granted the plaintiff's cross-motion to enforce a foreign country money judgment.
ORDERED that the order entered August 27, 2021, is modified, on the law, on the facts, and in the exercise of discretion, by (1) deleting the provision thereof granting the plaintiff's motion for an order of attachment and expedited discovery in aid of the attachment, and substituting therefor a provision denying the motion, (2) deleting the provisions thereof denying those branches of the motion of the defendants Maodong Xu, Fang Zhou, FZ Irrevocable Trust, and Haohan Xu which were pursuant to CPLR 3211(a) to dismiss the second through eighteenth and twentieth [*2]through twenty-fifth causes of action, and substituting therefor provisions granting those branches of the motion, and (3) deleting the provision thereof granting the plaintiff's cross-motion to enforce a foreign country money judgment, and substituting therefor a provision denying the cross-motion; as so modified, the order entered August 27, 2021, is affirmed; and it is further,
ORDERED that the order entered October 18, 2021, is modified, on the law, on the facts, and in the exercise of discretion, by (1) deleting the provision thereof granting the plaintiff's motion for an order of attachment and expedited discovery in aid of the attachment, and substituting therefor a provision denying the motion, (2) deleting the provisions thereof denying those branches of the motion of the defendants Maodong Xu, Fang Zhou, FZ Irrevocable Trust, and Haohan Xu which were pursuant to CPLR 3211(a) to dismiss the second through eighteenth and twentieth through twenty-fifth causes of action, and substituting therefor provisions granting those branches of the motion, and (3) deleting the provision thereof granting the plaintiff's cross-motion to enforce a foreign country money judgment, and substituting therefor a provision denying the cross-motion; as so modified, the order entered October 18, 2021, is affirmed; and it is further,
ORDERED that one bill of costs is awarded to the appellants appearing separately and filing separate briefs.
The plaintiff, a foreign business partnership with its principal place of business in China, allegedly entered into an equity transfer and capital increase agreement (hereinafter the agreement) with certain Chinese companies and the defendant Maodong Xu (hereinafter Xu) to acquire equity in a Chinese company, Galaxy Internet Group Co., Ltd. (hereinafter Galaxy Internet). After executing the agreement, the plaintiff remitted the equity transfer price and an increased capital contribution amount and received equity in Galaxy Internet. Pursuant to the agreement, if certain conditions were not met, the plaintiff could redeem the purchase price of its equity in Galaxy Internet. The plaintiff further alleged that Xu assumed joint and several liability for the Chinese companies' obligations under the agreement. The plaintiff commenced an action in a court in Beijing China (hereinafter the Beijing court), alleging that the Chinese companies and Xu breached the agreement, and on or about July 9, 2018, the Beijing court entered a money judgment in favor of the plaintiff and against the Chinese companies and Xu (hereinafter the Chinese money judgment).
In September 2020, the plaintiff commenced this action, inter alia, to enforce the Chinese money judgment, alleging that Xu sought to frustrate its ability to collect upon the Chinese money judgment by fleeing to the United States and transferring various assets to the defendants Fang Zhou, Xu's wife (hereinafter Zhou), Haohan Xu, Xu's son (hereinafter Haohan), and FZ Irrevocable Trust (hereinafter collectively the family defendants), which was controlled by Haohan, without receiving fair consideration in return. The family defendants were not parties to the Chinese money judgment. In addition to the cause of action against Xu to enforce the Chinese money judgment pursuant to CPLR article 53, the plaintiff also brought causes of action against Xu and/or the family defendants for injunctive relief, a declaratory judgment, an equitable lien, a constructive trust, specific performance, and an accounting, and alleging unjust enrichment, breach of contract, breach of the implied covenant of good faith, fraud, conspiracy, fraudulent conveyance, aiding and abetting fraud, tortious interference with the collectibility of a money judgment, conversion, tortious interference with contract, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, willful conduct, and promissory estoppel.
In November 2020, the plaintiff moved for an order of attachment with respect to the assets of Xu and the family defendants (hereinafter collectively the defendants) and expedited discovery in aid of the attachment pursuant to CPLR article 62 (hereinafter the plaintiff's first motion). Thereafter, the defendants moved pursuant to CPLR 3211(a) to dismiss the amended complaint (hereinafter the defendants' first motion), and the plaintiff cross-moved pursuant to CPLR article 53 to enforce the Chinese money judgment (hereinafter the plaintiff's first cross-motion). By order entered June 18, 2021, the Supreme Court denied the defendant's motion and the plaintiff's cross-motion without prejudice to renew for the plaintiff's failure to submit properly translated papers pursuant to CPLR 2101. The parties refiled their respective motions. In an order entered August 27, 2021, the court granted the plaintiff's first motion, denied the defendants' first motion, and granted the plaintiff's first cross-motion. In an order entered October 18, 2021, the court granted [*3]the plaintiff's refiled motion, denied the defendants' refiled motion, and granted the plaintiff's refiled cross-motion. The family defendants appeal from the orders entered August 27, 2021, and October 18, 2021 and Xu appeals from the order entered October 18, 2021.
"Under CPLR article 53, a judgment issued by the court of a foreign country is recognized and enforceable in New York State if it is final, conclusive and enforceable where rendered" (Huizhi Liu v Guoqing Guan, 225 AD3d 749, 750 [internal quotations marks omitted]; see Gemstar Can., Inc. v George A. Fuller Co., Inc., 127 AD3d 689, 690). "[A] foreign country judgment [generally] is considered conclusive between the parties to the extent that it grants or denies recovery of a sum of money" (Huizhi Liu v Guoqing Guan, 225 AD3d at 751 [internal quotation marks omitted]; see CIBC Mellon Trust Co. v Mora Hotel Corp., 100 NY2d 215, 221). "However, a foreign country judgment is not conclusive, and thus may not be recognized, if . . . it was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law" (Huizhi Liu v Guoqing Guan, 225 AD3d at 751 [internal quotation marks omitted]; see Gemstar Can., Inc. v George A. Fuller Co., Inc., 127 AD3d at 690). Although CPLR 5304 was amended effective June 11, 2021 (see L 2021, ch 127, § 5), those amendments apply to cases commenced on or after the effective date thereof (see L 2021, ch 127, § 10). Since this action was commenced prior to that effective date, we need not consider the impact of those amendments and express no view on that issue (see Huizhi Liu v Guoqing Guan, 225 AD3d at 751).
Here, the Supreme Court properly denied those branches of the defendants' first motion and the defendants' refiled motion which were pursuant to CPLR 3211(a) to dismiss the cause of action to enforce the Chinese money judgment. The defendants' submission of the United States Department of State's 2018 and 2019 China Country Reports, standing alone, was insufficient to demonstrate as a matter of law that the Chinese money judgment was rendered under a system that did not comport with requirements of due process (see Huizhi Liu v Guoqing Guan, 225 AD3d at 752; Shanghai Yongrun Inv. Mgt. Co., Ltd v Maodong Xu, 203 AD3d 495, 496; AlbaniaBEG Ambient Sh.p.k. v Enel S.p.A., 160 AD3d 93, 111 n 20).
However, the Supreme Court should have denied the plaintiff's first cross-motion and the plaintiff's refiled cross-motion to enforce the Chinese money judgment. The cross-motions were, in effect, for summary judgment confirming the Chinese money judgment. "A motion for summary judgment may not be made before issue is joined (CPLR 3212[a]) and the requirement is strictly adhered to" (City of Rochester v Chiarella, 65 NY2d 92, 101; see Brooklyn Bound Realty Corp. v Charles, 238 AD3d 1104, 1106). Here, although the plaintiff's cross-motions were denominated as motions pursuant to CPLR article 53, they were, in effect, motions for summary judgment. As the defendants did not answer the amended complaint, but instead made a pre-answer motion to dismiss, the plaintiff's cross-motions seeking recognition of the Chinese money judgment were procedurally improper, as they were initiated before the defendants joined issue (see City of Rochester v Chiarella, 65 NY2d at 101; Brooklyn Bound Realty Corp. v Charles, 238 AD3d at 1106). Moreover, the plaintiff's submissions were insufficient to establish, prima facie, that the Chinese judicial system is one that provides impartial tribunals and procedures compatible with the requirements of due process of law (see CPLR 5304[a][1]; Huizhi Liu v Guoqing Guan, 225 AD3d at 751).
"On a motion to dismiss pursuant to CPLR 3211(a)(7), the complaint is to be afforded a liberal construction, the facts alleged are presumed to be true, the plaintiff is afforded the benefit of every favorable inference, and the court is to determine only whether the facts as alleged fit within any cognizable legal theory" (Granizo v Krystal Fruits & Vegetables, Inc., 238 AD3d 719, 720 [internal quotation marks omitted]; see MJ Lilly Assoc., LLC v Ovis Creative, LLC, 221 AD3d 805, 807). "Dismissal of the complaint is warranted if the plaintiff fails to assert facts in support of an element of the claim, or if the factual allegations and inferences to be drawn from them do not allow for an enforceable right of recovery" (Franklin D. Nastasi Trust v Bloomberg, L.P., 224 AD3d 804, 808 [internal quotation marks omitted]; see Connaughton v Chipotle Mexican Grill, Inc., 29 NY3d 137, 142). "Where evidentiary material is submitted and considered on a motion to dismiss a complaint pursuant to CPLR 3211(a)(7), and the motion is not converted into one for summary judgment, the question becomes whether the plaintiff has a cause of action, not whether the plaintiff has stated one and, unless it has been shown that a material fact as claimed by the plaintiff to be one [*4]is not a fact at all and unless it can be said that no significant dispute exists regarding it, dismissal should not eventuate" (Granizo v Krystal Fruits & Vegetables, Inc., 238 AD3d at 720 [internal quotation marks omitted]; see Brathwaite v Eubanks, 235 AD3d 826, 826-827). "Affidavits submitted by [the movant] will almost never warrant dismissal under CPLR 3211 unless they establish conclusively that [the non-movant] has no . . . cause of action" (808 Union St., LLC v J. Lehman Park Slope, LLC, 216 AD3d 883, 884 [internal quotation marks omitted]; see Lawrence v Graubard Miller, 11 NY3d 588, 595; Rovello v Orofino Realty Co., 40 NY2d 633, 636). Furthermore, "a court may consider supplemental pleadings, affidavits, or other evidence submitted by the plaintiff to remedy any defects in the complaint" (Brathwaite v Eubanks, 235 AD3d at 826; see Rovello v Orofino Realty Co., 40 NY2d at 635).
"To state a cause of action to recover damages for conversion, a plaintiff must allege '(1) legal ownership or an immediate right of possession to a specific identifiable thing and (2) that the defendant exercised an unauthorized dominion over the thing in question to the exclusion of the plaintiff's right'" (Looks Great Servs., Inc. v Roosevelt, 239 AD3d 627, 630, quoting Giardini v Settanni, 159 AD3d 874, 875). Here, the plaintiff alleged that Xu converted to his own use assets of the Chinese companies, including the monies obtained from the plaintiff in payment for the equity in Galaxy Internet, thereby frustrating the plaintiff's ability to, by the agreement, guaranteed by Xu, redeem the entire equity it possessed in Galaxy Internet (see Kramer v Meridian Capital Group, LLC, 201 AD3d 909, 911; Bibbo v Arvanitakis, 145 AD3d 657, 660). Accordingly, the Supreme Court properly denied those branches of the defendants' first motion and the defendants' refiled motion which were to dismiss the nineteenth cause of action, alleging conversion.
However, the Supreme Court should have granted those branches of the defendants' first motion and the defendants' refiled motion which were to dismiss the second cause of action, seeking a preliminary injunction. "To be entitled to a preliminary injunction, a movant must establish (1) a likelihood of success on the merits, (2) irreparable injury absent granting the preliminary injunction, and (3) a balancing of the equities in the movant's favor" (County of Suffolk v Givens, 106 AD3d 943, 944; see 572 Walt Whitman Rd. Holdings, LLC v Whitman Capital, LLC, 237 AD3d 878, 882). Here, accepting as true the facts alleged in the amended complaint and according the plaintiff the benefit of every possible favorable inference, the amended complaint failed to allege facts establishing that monetary damages would be inadequate compensation (see Liang v Yi Jing Tan, 155 AD3d 1020, 1022).
The Supreme Court should have granted those branches of the defendants' first motion and the defendants' refiled motion which were to dismiss the third cause of action, seeking a declaratory judgment, as the Chinese money judgment has not been recognized and the plaintiff failed to plead the existence of other potential creditors against whom it should be declared as having priority (see Matter of 22-50 Jackson Ave. Assoc., L.P. v County of Suffolk, 216 AD3d 943, 946; Neuman v City of New York, 186 AD3d 1523, 1525).
The Supreme Court should have granted dismissal of the fourth cause of action, seeking an equitable lien, as the plaintiff never identified any specific properties that any of the defendants intended to transfer or allow to be held to secure an obligation (see M & B Joint Venture, Inc. v Laurus Master Fund, Ltd., 12 NY3d 798; Nationstar Mtge., LLC v Pajuelo, 203 AD3d 1056).
The Supreme Court should have granted dismissal of the sixth, eighth, tenth, seventeenth, twenty-third and twenty-fourth causes of action, alleging, respectively, unjust enrichment, breach of the implied covenant of good faith, fraud, aiding and abetting fraud, willful conduct, and promissory estoppel, as duplicative of the breach of contract cause of action (see Corsello v Verizon N.Y., Inc., 18 NY3d 777, 790; Goldberg v KOSL Bldg. Group, LLC, 236 AD3d 995, 997; Toobian v Toobian, 209 AD3d 907, 910; East Coast Intl. Tire Group, Inc. v New York Tire Factory, Inc., 185 AD3d 662, 663), and the seventh cause of action, alleging breach of contract, as a breach of the agreement was required to be litigated in the Chinese courts (see Air-Sea Packing Group, Inc. v Applied Underwriters, Inc., 228 AD3d 20, 25; Somerset Fine Home Bldg., Inc. v Simplex Indus., Inc., 185 AD3d 752, 753).
The Supreme Court should have granted dismissal of the ninth cause of action, [*5]seeking specific performance, as the subject matter of the agreement was not unique and the plaintiff had an adequate remedy at law (see Sokoloff v Harriman Estates Dev. Corp., 96 NY2d 409, 415; Rha v Blangiardo, 189 AD3d 1098, 1099).
The Supreme Court should have granted dismissal of the eleventh cause of action, alleging conspiracy, for lack of an underlying cognizable tort that the defendants acted in concert to perpetrate (see B & H Flooring, LLC v Folger, 228 AD3d 809, 812; Faulkner v City of Yonkers, 105 AD3d 899, 900).
The Supreme Court should have granted dismissal of the twelfth cause of action, alleging fraudulent conveyance pursuant to the version of Debtor and Creditor Law § 273-a applicable at the time of the alleged conveyances, as no final judgment had been rendered against Xu, since the Chinese money judgment has not yet been recognized under CPLR article 53 (see Scope v Equity NY Corp., 222 AD3d 687, 689; Amos Fin., LLC v Noya 23, LLC, 196 AD3d 450, 451). The Chinese money judgment will not become conclusive and, therefore, final until the plaintiff establishes it meets the requirements of CPLR 5304, which has not yet happened (see CIBC Mellon Trust Co. v Mora Hotel Corp., 100 NY2d at 221; Huizhi Liu v Guoqing Guan, 225 AD3d at 751). The court should have granted dismissal of the thirteenth through sixteenth causes of action, alleging, respectively, fraudulent conveyance pursuant to Debtor and Creditor Law §§ 275, 276, 276-a, and 278, as they were each premised on vague and conclusory allegations (see Precious Care Mgt., LLC v Monsey Care, LLC, 221 AD3d 922, 924; Riback v Margulis, 43 AD3d 1023; see also Eagle Eye Collection Corp. v Shariff, 190 AD3d 600, 601). Moreover, the documentary evidence submitted by the defendants in the form of deeds flatly contradicted the plaintiff's allegations that Xu held any interest in the real properties in Nassau County that the plaintiff alleged were fraudulently conveyed, as Zhou acquired them prior to Xu's business dealings with the plaintiff (see MJ Lilly Assoc., LLC v Ovis Creative, LLC, 221 AD3d at 806; Hartnagel v FTW Contr., 147 AD3d 819, 820).
The Supreme Court should have granted dismissal of the twenty-first, twenty-second, twenty-fifth, and fifth causes of action, which, respectively, alleged breach of fiduciary duty, alleged aiding and abetting a breach of fiduciary duty, sought an accounting, and sought the imposition of a constructive trust, because the plaintiff failed to plead that it was owed a fiduciary duty by Xu or the other defendants (see Golobe v Mielnicki, 44 NY3d 86, 93; Oddo Asset Mgt. v Barclays Bank PLC, 19 NY3d 584, 592-593; Board of Mgrs. of Country Pointe at Smithtown N. Condominium v Country Pointe at Smithtown Homeowners Assn., Inc., 240 AD3d 650, 652; Angel v Strulovich, 240 AD3d 643, 644; Plymouth Capital, LLC v Montage Fin. Group, Inc., 230 AD3d 1361, 1364).
The Supreme Court should have granted dismissal of the twentieth cause of action, alleging tortious interference with contract, as Xu was a party to the agreement with which the plaintiff alleged he interfered (see U.S. Bank N.A. v Kahn Prop. Owner, LLC, 206 AD3d 855, 858; Sutton v Houllou, 191 AD3d 1031, 1034), and the eighteenth cause of action, alleging tortious interference with the collectibility of a money judgment, as premature because the Chinese money judgment had not yet been recognized pursuant to CPLR article 53 (see Priestley v Panmedix Inc., 134 AD3d 642, 643; see also Quinby v Strauss, 90 NY 664).
"In order to be granted an order of attachment under CPLR 6201(3), a plaintiff must demonstrate that the defendant has concealed or is about to conceal property in one or more of several enumerated ways, and has acted or will act with the intent to defraud creditors, or to frustrate the enforcement of a judgment that might be rendered in favor of the plaintiff" (Cyngiel v Krigsman, 192 AD3d 762, 763 [internal quotation marks omitted]; see Hume v 1 Prospect Park ALF, LLC, 137 AD3d 1080, 1081). "Affidavits containing allegations raising a mere suspicion of an intent to defraud are insufficient. It must appear that such fraudulent intent really existed in the defendant's mind" (Cyngiel v Krigsman, 192 AD3d at 763 [internal quotation marks omitted]; see Hume v 1 Prospect Park ALF, LLC, 137 AD3d at 1081). "Fraud is not lightly inferred, and the moving papers must contain evidentiary facts—as opposed to conclusions—proving the fraud" (Societe Generale Alsacienne De Banque, Zurich v Flemingdon Dev. Corp., 118 AD2d 769, 772 [internal quotation marks omitted]). "The mere removal, assignment or other disposition of property is not grounds for attachment" (Cyngiel v Krigsman, 192 AD3d at 763 [internal quotation marks omitted]; see CPLR [*6]6212[a]; 651 Bay St., LLC v Discenza, 189 AD3d 952). For an attachment under CPLR 6201(5), the plaintiff must show that it has a judgment which qualifies for recognition under CPLR article 53 (see id. § 5304[a][1]). The plaintiff must also show a probability of success on the merits of the underlying cause of action "by affidavit[s] and such other written evidence as may be submitted" (id. § 6212[a]; see Hume v 1 Prospect Park ALF, LLC, 137 AD3d at 1081; Grafstein v Schwartz, 100 AD3d 699).
Here, through its attorney's affirmation, the plaintiff did no more than allege Xu's mere removal or other disposition of property, which is insufficient for an attachment pursuant to CPLR 6201(3) (see Cyngiel v Krigsman, 192 AD3d at 763; 651 Bay St., LLC v Discenza, 189 AD3d at 953). The plaintiff also failed to make the necessary showing under CPLR 6201(5), as the plaintiff did not establish that it has a judgment that has been recognized pursuant to CPLR article 53. Accordingly, the Supreme Court should have denied those branches of the plaintiff's first motion and the plaintiff's refiled motion which were for an order of attachment. Without a valid attachment order, the court also should have denied those branches of the plaintiff's first motion and the plaintiff's refiled motion which were for expedited discovery in aid of attachment (see id. § 6220; Ferriter v Cook, 231 AD2d 871, 872; Carteret Sav. Bank v East-West Assoc. Ltd. Partnership, 143 AD2d 612, 613; see also Posadas De Puerto Rico v Gruberman, 226 AD2d 249, 253).
The parties' remaining contentions are either without merit or, in light of this determination need not be reached.
BRATHWAITE NELSON, J.P., FORD, WAN and LOVE, JJ., concur.
ENTER:
Darrell M. Joseph
Clerk of the Court