Recent Victories

Selendy & Gay has attained an extraordinary set of victories across multiple areas of practice. Just a few of our victories include:

  • Mudrick Capital Management in achieving a trial victory in the Delaware Court of Chancery in an action commenced under Section 220 of Delaware’s General Corporation Law, seeking corporate books and records to investigate an allegedly unfair merger. In an order adopting many of our factual allegations regarding the proposed merger, the defendant was ordered to produce e-mails from its C.E.O., its General Counsel, and the chair of the Special Committee that had approved the merger. One day after this ruling, the challenged merger was called off.
  • U.S. Bank, as trustee, in a RMBS putback action against UBS Real Estate Securities, for losses suffered by three UBS-sponsored RMBS Trusts (MARM 2006-OA2, MARM 2007-1, and MARM 2007-3). This case was the first RMBS trustee putback action to go to trial, and the settlement – an unprecedented $850 million recovery – constitutes the largest recovery ever achieved in such a case.
  • Cerberus Capital Management, L.P., a private equity firm with more than $40 billion under management, as plaintiff in a $950 million breach of contract action against the Canadian Imperial Bank of Commerce (CIBC), one of Canada’s largest banks. The dispute centered on two complex structured finance transactions (in 2008 and 2011, respectively) by which special-purpose investment vehicles created by Cerberus assumed a large part of CIBC’s exposure to losses in the U.S. residential mortgage market. Cerberus alleges that, pursuant to the transactions, CIBC was able to offload substantial mortgage-related risks in exchange for making specified payments to Cerberus. According to Cerberus, CIBC received the benefit of the transactions but now refuses to pay what it agreed to pay for Cerberus’s assumption of the risk of massive housing-related losses. Cerberus was one of the few financial entities with both the resources and the willingness to assume CIBC’s risks at a time of profound illiquidity and market uncertainty, and—if Cerberus had not been willing to enter into the transactions—CIBC’s exposure could have been many times what it agreed to pay Cerberus. The court ruled on Cerberus’s motion for partial summary judgment in April 2018, narrowing the issues for trial, and portions of the summary judgment ruling are currently on appeal before the First Department.
  • CRC Credit Fund Ltd. against Deutsche Bank AG Frankfurt in a federal interpleader action asserted by Bank of New York Mellon in the District Court for the Southern District of New York. In a cross-claim, CRC seeks damages for Deutsche Bank’s inclusion of an ineligible reference obligation in a credit default swap for which CRC provided credit protection. The court ruled as a matter of law for CRC, holding that the reference obligation’s maturity date violated the swap’s eligibility criteria and that Deutsche Bank breached the swap agreement when it obtained an erroneous accounting certification that directed the trustee to pay credit protection to Deutsche Bank.
  • Altaba (formerly Yahoo Inc.), against claims by BNY Mellon Trust in Delaware Court of Chancery in front of Vice Chancellor Travis Laster that our client owed $300 million under a $1.4 billion convertible note agreement after the sale of Yahoo’s operating business to Verizon. On behalf of our client, we succeeded in having the case dismissed with prejudice at the pleading stage.
  • E*Trade Financial Corp., an online retail brokerage firm, and its related parties, in successfully obtaining affirmance from the Second Circuit in the dismissals of two separate putative class actions related to the purported improper steering of trades. In one decision, the Second Circuit affirmed the dismissal of a putative class action alleging claims under state law as precluded by the Securities Litigation Uniform Standards Act of 1998. In the second decision, the Second Circuit affirmed the dismissal of another putative class action alleging claims under federal securities laws on a rare ground, for failure to plead reliance.
  • U.S. Bank as Trustee of an asset-backed securities trust before the New York Court of Appeals in upholding the viability of CPLR 205(a), a nearly 400-year-old pleading rule. Defendant-appellant DLJ Mortgage Capital, Inc. attempted to avoid the Trustee’s timely breach of contract suit by arguing the Trustee failed to satisfy the so-called “notice-and-cure protocol” as to a defunct contracting party. Agreeing with all of the Trustee’s arguments on appeal, the Court of Appeals held that CPLR 205(a) allowed a plaintiff six months after dismissal of a timely action for failure to comply with a procedural condition precedent to remedy the defect. In holding that the “notice-and-cure protocol” was a procedural condition precedent to suit, not a substantive element of a Trustee’s breach of contract claim, the Court rejected a defense-friendly interpretation of its prior precedent and reaffirmed that banks that sold faulty asset-backed securities in the mid-2000s may be held accountable to those they misled. The Court’s unanimous 7-0 opinion confirms New York’s long-standing policy of allowing plaintiffs to correct technical defects so that courts may decide cases on the merits—a crucial result for commercial entities and individuals doing business in this state.
  • McKinsey & Company, a worldwide management consulting firm, against claims by Jay Alix, founder of consulting firm AlixPartners, and Mar-Bow Partners, a company founded by Alix, challenging McKinsey’s Chapter 11 disclosures under Rule 2014. In August of 2019, we achieved a significant victory in the Southern District of New York, where the Court dismissed RICO claims against our client in their entirety. Without leave to re-plead against our client, the Court concluded that Alix could not state any RICO claim in the face of binding Supreme Court and Second Circuit law requiring that Alix plead facts showing that the purportedly wrongful conduct “proximately caused” the injury alleged.
  • McKinsey & Company, in the matter of SunEdison in the Southern District of New York, against claims by Jay Alix and Mar-Bow Partners. Alix asserted claims of false and misleading disclosures, and fraudulent preference. We successfully obtained a dismissal of Alix’s motion to have the court examine his claims for lack of standing. The court in SunEdison also declined to appoint Alix as an examiner.
  • McKinsey & Company, in the matter of Alpha Natural Resources, in successfully achieving, despite a relentless campaign, a ruling in federal bankruptcy court in Richmond, VA that Jay Alix’s Mar-Bow Partners does not have standing to be heard on its ongoing conflict-of-interest dispute in relation to Alpha Natural Resources, a bankruptcy coal miner. The Court also declined to appoint an examiner to investigate Alix’s allegations independently. We also achieved a settlement with the Office of the United States Trustee with respect to bankruptcy disclosure disputes.
  • McKinsey & Company, in arguing against a motion to reopen the closed NII Holdings bankruptcy by Jay Alix’s Mar-Bow Partners and defending against allegations of fraud on the court in connection with McKinsey’s disclosures. We successfully achieved a ruling from the bench in the bankruptcy court for the Southern District of New York. Deeming the allegations “fantasy,” the Court denied Mar-Bow’s motion to reopen for lack of standing and declined to appoint Mar-Bow as investigator of its own claims.
  • McKinsey & Company, in the matter of Standard Register, in successfully defending against claims by Mar-Bow Partners alleging that McKinsey failed to disclose its connections, thereby committing fraud on the Court. We obtained a favorable ruling in the bankruptcy court for the District of Delaware, denying Mar-Bow’s motion to reopen the matter for lack of standing, and declining to appoint an examiner to investigate Mar-Bow’s claims.
  • The Niskanen Center, a leading policy think-tank, as amicus curiae supporting New Jersey in an appeal of a decision that allowed a pipeline company to use the federal power of eminent domain to seize state lands. In a precedential decision specifically citing our analysis, the Third Circuit Court of Appeals vacated the lower court’s decision, holding that the Eleventh Amendment bars private parties from condemning state lands under the Natural Gas Act.