

Zohar CDO 2003-1 Ltd. v Xinhua Sports & Entertainment Ltd. (2016 NY Slip Op 05543)





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


2016 NY Slip Op 05543


Decided on July 14, 2016


Appellate Division, First Department


Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.


This opinion is uncorrected and subject to revision before publication in the Official Reports.



Decided on July 14, 2016

Sweeny, J.P., Richter, Manzanet-Daniels, Gische, JJ.


494 651473/11

[*1]Zohar CDO 2003-1 Limited, et al., Plaintiffs-Appellants, —
vXinhua Sports & Entertainment Limited, et al., Defendants, Loretta Freddy Bush, Defendant-Respondent.


Shapiro Arato LLP, New York (Eric S. Olney of counsel), for appellants.
Drinker Biddle & Reath, LLP, New York (Clay J. Pierce of counsel), for respondent.

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 plaintiff in December 2008, the earnings reported in its 2007 Form 20-F and its representations about Economic Observer which induced the 2009 Amendment 1 and sale of the Economic Observer were false and unreasonable (see East 32nd St. Assoc. v Jones Lang Wootton USA, 191 AD2d 68 [1st Dept 1993]).
The Decision and Order of this Court entered herein on March 15, 2016 (137 AD3d 541) is hereby recalled and vacated (see M-1943 decided simultaneously herewith).
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
ENTERED: JULY 14, 2016
CLERK


