ICBC (London) PLC v. Blacksands Pacific Group, Inc. ( 2016 )

15-3387
ICBC v. Blacksands
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY
ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX
OR AN ELECTRONIC DATABASE (WITH THE NOTATION ASUMMARY ORDER@). A PARTY CITING A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals for
2 the Second Circuit, held at the Thurgood Marshall United States
3 Courthouse, 40 Foley Square, in the City of New York, on the
4 26th day of September, two thousand sixteen.
5
6 PRESENT: DENNIS JACOBS,
7 BARRINGTON D. PARKER,
8 DEBRA ANN LIVINGSTON,
9 Circuit Judges.
10
11 - - - - - - - - - - - - - - - - - - - -X
12 ICBC (LONDON) PLC,
13 Plaintiff-Counter-Defendant
14 -Appellee,
15
16 -v.- 15-3387
17
18 BLACKSANDS PACIFIC GROUP, INC.,
19 Defendant-Counter-Claimant-
20 Appellant,
21
22 BLACKSANDS PACIFIC ALPHA BLUE, LLC,
23 Counter-Claimant.
24
25 - - - - - - - - - - - - - - - - - - - -X
26
1
1 FOR APPELLANT: VIRGINA TENT (Christopher R.
2 Harris, on the brief), Latham
3 & Watkins LLP, New York, NY.
4
5 FOR APPELLEE: PAUL S. HESSLER (Charles T.
6 Pollack, on the brief),
7 Linklaters LLP, New York, NY.
8
9 Appeal from a judgment of the United States District Court
10 for the Southern District of New York (Kaplan, J.).
11
12 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED AND
13 DECREED that the judgment of the district court be AFFIRMED.
14
15 Blacksands Pacific Group, Inc. (“Blacksands”) appeals from
16 the district court’s grant of summary judgment against it
17 regarding its guarantee under a loan agreement. We review de
18 novo a district court’s grant of summary judgment. Kulak v.
19 City of New York, 88 F.3d 63, 71 (2d Cir. 1996). We assume the
20 parties’ familiarity with the underlying facts, the procedural
21 history, and the issues presented for review.
22 On November 25, 2013, ICBC (London) plc (“ICBC”),
23 Blacksands, and Blacksands’s subsidiary Blacksands Alpha Blue,
24 LLC (“Alpha Blue”) entered into a bridge loan agreement (“BLA”).
25 Pursuant to the BLA, ICBC provided a $20 million loan to Alpha
26 Blue, which its parent company, Blacksands, guaranteed. Alpha
27 Blue withdrew $5 million from this $20 million loan facility.
28 Under the BLA, Blacksands “absolutely and unconditionally”
29 guaranteed the loan made by ICBC to Alpha Blue. Section 9.1
30 of the BLA states in pertinent part:
31 The Guarantor hereby absolutely, unconditionally and
32 irrevocably guarantees to the Lender the prompt
33 payment in full when due (whether at stated maturity,
34 by acceleration or otherwise) of the Obligations
35 strictly in accordance with the terms thereof. The
36 Guarantor further agrees that if the borrower shall
37 fail to pay in full when due any of the Obligations,
38 the Guarantor shall immediately be liable for the
39 same, without any demand or notice whatsoever, and
2
1 that if any extension of time is given for the payment
2 of any of the Obligations, the same shall be promptly
3 paid in full when due (whether at extended maturity,
4 by acceleration or otherwise) strictly in accordance
5 with the terms therof.
6 Section 9.2 reinforces or reiterates Blacksands’s
7 guarantee obligations, stating that they are:
8 absolute and unconditional, irrespective of the
9 value, validity or enforceability of the obligations
10 of the Borrower under this Agreement or any other Loan
11 Document and irrespective of any other circumstance
12 which might otherwise constitute a legal or equitable
13 discharge or defense in favor of the Guarantor or the
14 Borrower (other than payment in full of the
15 Obligations), it being the intent of this Section 9.2
16 that the obligations of the Guarantor hereunder shall
17 be absolute and unconditional under any and all
18 circumstances.
19 Section 9.2 adds that:
20 the occurrence of any one or more of the following
21 shall, to the fullest extent permitted by Applicable
22 Law, not alter or impair the obligations of the
23 Guarantor hereunder which shall remain absolute and
24 unconditional as described above: . . . (b) any lack
25 of validity or enforceability of any Loan Document or
26 any other agreement or instrument relating thereto
27 against any Obligor . . . .
28 In addition to these guarantee provisions, of the kind
29 colloquially called ironclad, the BLA contains an integration
30 clause, no-oral-amendment clause, and no-waiver clause.
31 The bridge loan matured on February 24, 2014. However,
32 ICBC ultimately extended the maturity date in writing to July
33 31, 2014. When the loan was not repaid on the extended maturity
34 date, ICBC sent Blacksands and Alpha Blue a letter notifying
35 them of the default and demanding payment. When neither
36 Blacksands nor Alpha Blue made payment, ICBC filed suit.
3
1 1. Blacksands argues that repayment of the bridge loan
2 was, and still is, not actually due because: (1) the BLA was
3 supposed to roll over into a $70 million revolving credit
4 facility (“RCF”), which ICBC never issued; (2) ICBC waived
5 repayment until replacement financing could be obtained, which
6 never happened; (3) ICBC breached the BLA by failing to
7 negotiate the RCF in good faith; and (4) ICBC fraudulently
8 induced Blacksands to enter into the BLA.
9 These arguments are without merit, as the district court
10 held. In a nutshell, although the BLA requires the parties to
11 negotiate the RCF in good faith, the BLA is a standalone
12 agreement that obligates Blacksands to repay the bridge loan
13 at maturity regardless of any circumstances or defenses (other
14 than payment in full). The parties were allowed to amend the
15 BLA, but any amendment had to be in writing, and Blacksands
16 points to no writing that conditioned repayment on either the
17 RCF being issued or replacement financing being obtained. Nor
18 does Blacksands offer any reason why oral representations
19 allegedly made by ICBC should bar enforcement of its guarantee.
20 Blacksands argues fraudulent inducement; but that defense
21 was waived in Section 9.2 of the BLA. Under New York law, which
22 governs the underlying contract dispute, Jazini v. Nissan Motor
23 Co., Ltd., 148 F.3d 181, 183 (2d Cir. 1998), a strongly worded
24 guarantee, like the one at issue here, in a multimillion-dollar
25 contract negotiated by sophisticated businesspeople forecloses
26 a guarantor’s fraudulent inducement defense. See Citibank,
27 N.A. v. Plapinger, 66 N.Y.2d 90, 95 (1985). This Court’s
28 opinion in Manufacturers Hanover Trust Co. v. Yanakas, 7 F.3d
29 310 (2d Cir. 1993), is not to the contrary. In Yanakas, we
30 observed that certain facts -- not at issue here --
31 distinguished the guarantee from the one in Plapinger. 7 F.3d
32 at 317.
33 Regardless of waiver, however, Blacksands offers no
34 evidence to even support a fraudulent inducement defense. See
35 Kulak, 88 F.3d at 71 (“Though we must accept as true the
36 allegations of the party defending against the summary judgment
37 motion, drawing all reasonable inferences in his favor,
38 conclusory statements, conjecture, or speculation by the party
4
1 resisting the motion will not defeat summary judgment.”
2 (internal citation omitted)).
3 2. Next, Blacksands argues that the district court
4 improperly granted summary judgment without first allowing
5 discovery. We review the district court’s denial of a request
6 for time to conduct discovery pursuant to Fed. R. Civ. P.
7 (“Rule”) 56(d) for abuse of discretion. Paddington Partners
8 v. Bouchard, 34 F.3d 1132, 1137 (2d Cir. 1994).
9 Because Blacksands had agreed to litigate disputes
10 regarding the bridge loan guarantee pursuant to N.Y. Civil
11 Practice Law and Rules (“CPLR”) § 3213’s accelerated,
12 pre-discovery procedure for summary judgment, when the case was
13 removed to federal court, ICBC’s summary judgment motion was
14 submitted without discovery. Although Blacksands discussed
15 the need to conduct discovery in its opposition to ICBC’s
16 motion, it failed to submit anything that amounted to a Rule
17 56(d) affidavit. “[T]he failure to file such an affidavit is
18 fatal to a claim . . . even if the party resisting the motion
19 for summary judgment alluded to a claimed need for discovery
20 in a memorandum of law.” Gurary v. Winehouse, 190 F.3d 37,
21 43-44 (2d Cir. 1999) (citing Paddington Partners, 34 F.3d at
22 1137). Moreover, Blacksands fails to show how discovery would
23 lead to facts that might justify its opposition. Therefore,
24 the district court did not abuse its discretion by deciding
25 ICBC’s summary judgment motion without first allowing
26 discovery.
27 3. Finally, Blacksands argues that the district court
28 erred by issuing final judgment on ICBC’s summary judgment
29 motion while Blacksands’s surviving counterclaim remains
30 pending. We review the district court’s certification of
31 partial summary judgment for abuse of discretion. Transp.
32 Workers Union of Am., Local 100 v. N.Y. City Transit Auth., 505
33 F.3d 226, 230 (2d Cir. 2007).
34 The certification of a partial judgment is governed by Rule
35 54(b), which states in pertinent part:
36 When an action presents more than one claim for relief
37 -- whether as a claim, counterclaim, crossclaim, or
38 third-party claim -- or when multiple parties are
5
1 involved, the court may direct entry of a final
2 judgment as to one or more, but fewer than all, claims
3 or parties only if the court expressly determines that
4 there is no just reason for delay.
5 “Rule 54(b) provides an exception to the general principle
6 that a final judgment is proper only after all claims have been
7 adjudicated.” Harriscom Svenska AB v. Harris Corp., 947 F.2d
8 627, 629 (2d Cir. 1991). In order to properly grant Rule 54(b)
9 certification, however, a district court must “offer a brief,
10 reasoned explanation” of its decision. Id. Moreover, “the
11 court should not enter final judgment dismissing a given claim
12 unless that claim is separable from the claims that survive.”
13 Hogan v. Conrail, 961 F.2d 1021, 1026 (2d Cir. 1992) (internal
14 quotation marks omitted).
15 The district court’s Rule 54(b) analysis satisfies the
16 “brief, reasoned explanation” requirement. As the district
17 court pointed out, Blacksands’s payment obligation under the
18 BLA is entirely independent of its counterclaims against ICBC:
19 regardless of the merits of those counterclaims, Blacksands has
20 an “absolute and unconditional” obligation to repay the bridge
21 loan. Thus, the district court did not abuse its discretion
22 by granting Rule 54(b) certification.
23 Accordingly, we hereby AFFIRM the judgment of the district
24 court.
25 FOR THE COURT:
26 CATHERINE O’HAGAN WOLFE, CLERK
6