Summary
declining to consider argument raised for the first time in party's reply brief
Summary of this case from City of New York ex rel. Lerman v. EJ Elec. Installation Co.Opinion
2012-12-20
JPMORGAN CHASE BANK, N.A., Plaintiff, v. LUXOR CAPITAL, LLC, Defendant–Appellant. Luxor Capital, LLC, Third–Party Plaintiff–Appellant, v. Credit Industriel ET Commercial, Third–Party Defendant–Respondent.
Porzio, Bromberg & Newman, P.C., New York (Peter J. Gallagher of counsel), for appellant. Jenner & Block LLP, New York (Carletta F. Higginson of counsel), for respondent.
Porzio, Bromberg & Newman, P.C., New York (Peter J. Gallagher of counsel), for appellant. Jenner & Block LLP, New York (Carletta F. Higginson of counsel), for respondent.
TOM, J.P., SWEENY, DeGRASSE, CLARK, JJ.
Order, Supreme Court, New York County (Eileen Bransten, J.), entered July 26, 2011, which, to the extent appealed from as limited by the briefs, denied defendant/third-party plaintiff Luxor's motion for summary judgment on its contractual indemnification claim against third-party defendant Credit Industriel et Commercial (CIC), unanimously affirmed, with costs.
The indemnification clause in the Loan Syndication and Trading Association agreement at issue provides, among other things, that CIC shall indemnify Luxor for any costs or expenses arising out of a breach of CIC's representations and warranties under the agreement. The IAS court correctly denied Luxor's motion as premature, as it cannot be determined on this record whether CIC breached the LSTA agreement. CIC's duty to defend is not broader than its duty to indemnify ( see Inner City Redevelopment Corp. v. Thyssenkrupp El. Corp., 78 A.D.3d 613, 613, 913 N.Y.S.2d 29 [1st Dept.2010] ), and the indemnification clause does not apply to the mere assertion of claims, regardless of their outcome ( cf. Bradley v. Earl B. Feiden, Inc., 8 N.Y.3d 265, 275, 832 N.Y.S.2d 470, 864 N.E.2d 600 [2007] ).
It cannot be determined on this record whether section 4.1(h) of the LSTA agreement is implicated, as the language in that section is ambiguous ( see RM Realty Holdings Corp. v. Moore, 64 A.D.3d 434, 436, 884 N.Y.S.2d 344 [1st Dept.2009] ). Indeed, there are reasonable, conflicting interpretations of that section, including CIC's interpretation that it applies only to conduct that results in equitable subordination, which is not at issue here ( see Enron Corp. v. Springfield Assoc., LLC [ In re Enron Corp.], 379 B.R. 425, 444 n. 96 [S.D.N.Y.2007] ).
We do not reach Luxor's argument, raised for the first time in its appellate reply brief, that CIC breached its warranties in section 4.1(g) and (i) of the LSTA agreement ( see Cassidy v. Highrise Hoisting & Scaffolding, Inc., 89 A.D.3d 510, 511, 932 N.Y.S.2d 456 [1st Dept.2011] ). Were we to reach the argument, we would still find that Luxor's motion was correctly denied, as the waiver upon which it bases its argument has terms that are ambiguous.
We also decline to consider Luxor's argument that it is entitled to indemnification under section 6.1(a)(ii) of the LSTA agreement, as the argument was raised for the first time in Luxor's reply before the IAS court ( see Lumbermens Mut. Cas. Co. v. Morse Shoe Co., 218 A.D.2d 624, 625–626, 630 N.Y.S.2d 1003 [1st Dept.1995] ). Were we to consider the argument, we would affirm the denial of summary judgment, as the language in section 6.1(a)(ii) is ambiguous.