Zohar CDO 2003-1 Ltd. v. Xinhua Sports & Entertainment Ltd.

137 A.D.3d 541, 26 N.Y.S.3d 689

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: March 15, 2016
• Docket: 494 651473/11
• Status: Published

Opinion

Order, Supreme Court, New York County (Charles E. Ramos, J.), entered January 15, 2015, which granted defendant Loretta Freddy Bush’s motion for summary judgment dismissing the complaint as against her, unanimously reversed, on the law, without costs, and the motion denied.

The motion court correctly found that, in view of defendant Xinhua Sports & Entertainment Limited’s (XSEL) contractual agreements with its affiliates, defendant Bush’s representations that XSEL had “effective control” over those companies were not false when made, and therefore could not support a cause of action for fraudulent inducement.

However, Bush failed to eliminate all material issues of fact as to whether she knew that XSEL’s internal financial projections sent to plaintiffs in October 2008 and March 2009, its 2010 revenue forecast for Shanxi Satellite TV sent to plaintiffs in December 2008, and the earnings reported in its 2007 Form 20-F were false and unreasonable (see East 32nd St. Assoc. v Jones Lang Wootton USA, 191 AD2d 68 [1st Dept 1993]).

Concur—Sweeny, J.P., Richter, Manzanet-Daniels and Gische, JJ.