Opinion
6753 Index 653920/16
05-31-2018
LANTAU HOLDINGS LTD., Plaintiff–Appellant, v. ORIENT EQUAL INTERNATIONAL GROUP LIMITED et al., Defendants, Haitong International Securities Company Limited, Defendant–Respondent.
CKR Law LLP, New York (Michael J. Maloney of counsel), for appellant. Crowell & Moring LLP, New York (Alan B. Howard of counsel), for respondent.
CKR Law LLP, New York (Michael J. Maloney of counsel), for appellant.
Crowell & Moring LLP, New York (Alan B. Howard of counsel), for respondent.
Sweeny, J.P., Richter, Andrias, Kahn, Moulton, JJ.
Order, Supreme Court, New York County (Anil C. Singh, J.), entered March 8, 2017, which, insofar as appealed from, granted defendant Haitong International Securities Company Limited's motion to dismiss the complaint as against it for lack of personal jurisdiction and failure to state a cause of action, and denied plaintiff's cross motion for jurisdictional discovery, unanimously affirmed, with costs.
While codefendants Orient Equal International Group Limited (OEI) and Huang Dongpo consented to New York jurisdiction in the contracts they signed, Haitong did not consent to such jurisdiction, and none of the exceptions to the general rule that a forum selection clause may not be enforced against a nonsignatory applies to it (see Tate & Lyle Ingredients Ams., Inc. v. Whitefox Tech. USA, Inc., 98 A.D.3d 401, 949 N.Y.S.2d 375 [1st Dept. 2012] ).
Haitong is not subject to New York jurisdiction pursuant to CPLR 302(a)(3). Among other things, the statute requires the defendant to have committed a tort outside the state. However, the complaint, which asserts claims of negligent misrepresentation and fraud against Haitong, fails to state a cause of action for either. The special relationship required for negligent misrepresentation (see Mandarin Trading Ltd. v. Wildenstein, 16 N.Y.3d 173, 180, 919 N.Y.S.2d 465, 944 N.E.2d 1104 [2011] ) is not present in the "ordinary arm's length business transaction" between plaintiff and Haitong ( US Express Leasing, Inc. v. Elite Tech. [NY], Inc., 87 A.D.3d 494, 497, 928 N.Y.S.2d 696 [1st Dept. 2011] ). Even if, arguendo, Haitong had superior knowledge that the shares pledged by OEI and Dongpo to plaintiff were subject to a lock-up, plaintiff's failure to ask if the shares were subject to the lock-up negates the reasonable reliance element of negligent misrepresentation (see e.g. Mandarin, 16 N.Y.3d at 180, 919 N.Y.S.2d 465, 944 N.E.2d 1104 ; Hudson Riv.Club v. Consolidated Edison Co. of N.Y., 275 A.D.2d 218, 220–221, 712 N.Y.S.2d 104 [1st Dept. 2000] ).
For the same reasons, plaintiff has no cause of action for fraudulent concealment (see e.g. Gomez–Jimenez v. New York Law Sch., 103 A.D.3d 13, 18, 956 N.Y.S.2d 54 [1st Dept. 2012] [special relationship], lv denied 20 N.Y.3d 1093, 965 N.Y.S.2d 78, 987 N.E.2d 639 [2013] ; Mandarin, 16 N.Y.3d at 178, 919 N.Y.S.2d 465, 944 N.E.2d 1104 [reasonable reliance]; Global Mins. & Metals Corp. v. Holme, 35 A.D.3d 93, 99–100, 824 N.Y.S.2d 210 [1st Dept. 2006], lv denied 8 N.Y.3d 804, 831 N.Y.S.2d 106, 863 N.E.2d 111 [2007] ).
Because the court correctly granted Haitong's motion to dismiss for lack of personal jurisdiction, it correctly denied plaintiff's cross motion for jurisdictional discovery (see Murdock v. Arenson Intl. USA, 157 A.D.2d 110, 115, 554 N.Y.S.2d 887 [1st Dept. 1990] ).