Preview
067-331258-22
FILED
TARRANT COUNTY
KrnKMAru Lnw FtRrvl, PLLC 6/21/2022 2:04 PM
THOMAS A. WILDER
ATTORNEYS AND COUNSELORS DISTRICT CLERK
201 MAIN STREET, SUITE 1 160
FORT WORTH, TEXAS 761 02
817-336-2800
FACSIMILE 817-8771863
WILLIAM L. KIRKMAN PRESTON B, SAWYER
irm.com
billk@k¡rkmanlalvf prestons@kirkmanlawfirm.com
June 21,2022
Honorable Don Cosby, Judge VIAI.EILE
67th Judicial District Court
Tom VandergrifT Civil Courts Building
Fourth Floor
100 North Calhoun Street
Fort Worth, Texas 76196
Dear Judge Cosby:
Re: Cause No. 067-331258-22
Moncríef Pørtners, L.P, v. RMWJR Explorøtíon, LLC
ønd Richørd ll'. Moncríef et ø1, v. CBM Genpør, Inc.
This letter clarifies three points following the hearing in this matter last
Friday.
1. Both sides agree that intervention is authorizedas amatter of rìght
when the intervenor has a justiciable interest in the lawsuit. In Re Union
Carbide,273 S.V/. 3d 153, 154 (Tex. 2008). "To constitute ajusticiable interest,
'[t]he intervenor's interest must be such thatif the original action had never
been commenced, andhe had first brought itas the sole plaintiff, he would have
Cr([
knr¿hUtrLl^\f l¡,EsùIONcRIEF r. HOLÀISEN\cosBY-Ltl"l DR-.{il
Honorable Don Cosby, Judge
June 21,2022
Page 2
beent entitled to recover in his own name to the extent at least of apart of the
relief sought in the original suit."' Id. at 155 (emphasis added) (citing King v.
Olds,71 Tex. 729, 12 S.W. 65, 65 (Tex. 1888)). Had the Plaintiff limited
partnership not filed this suit, the limited partner W. A. Moncrief, Jr.
Management Trust ("Management Trust") could have done so in its own name
under Delaware law. Derivative relief for a limited partner under Delaware law
expressly provides that alimited partner "may bring an action in the ríght of a
tímitedpartnershíp to recover judgmentin itsfavor if general partners withthe
authority to do so have refused to bring the action or if an effort to cause those
general partners to bring the action is not likely to succeed." DELAWARE CooE,
Section 17.1001 (emphasis added). The Management Trust was therefore
entitled to intervene as a matter of right and therefore has a justiciable interest
in doing so under Delaware law.
2. Partnership provisions describing the rights and duties ofthe general
partner and limited partner do not negate the valuable right to assert derivative
relief under Delaware law. The highlighted Talking Capital case from New
York (both the trial case and appellate court opinion arc attached hereto) is
instructive on that last point. Derivative relief should be allowed under
Delaware law unless the operating orpartnership agreementexpressþprohibits
that right . Tatking Cap LLC v. Omanffi201 I WL 1 03 03 1 5 (N.Y. Sup. Ct. Feb.
23,2018), modified and affl d,94N.Y.S.3d 31, 169 4.D.3 d423 (N.Y.App.Div.
2019).In modi$'ing and affirming the trial court's order, the appellate division
expressly stated that, while an operating agreement may vary Delaware statutes,
the operating agreement at issue "does not provide for a waiver by the members
lThe a justiciable is hypothetical-would the Intervenor have been
test for interest
able to recover in its own nalne had the Plaintiff not sought to recover in its name? Here,
DpLRwaRp Cone, Section 17.1001 precisely tracks this hypothetical test, allowing a limited
o'recover judgment in its
partner to bring suit "in the right of the limited partnership" and to
favor" if the limited partnership does not do so. And, because the general partner, CBM
Genpar, has turned a blind eye to the millions of dollars wrongfully taken from the limited
partnership, the Management Trust needs to be a party to this proceeding to protect its rights
with respect to any money recovered in this proceeding by the limited partnership and to
protect the right to arbitrate.
r
Giñrknronl¡tJLL\\f ILIS\ùf IIER-,t|il
tIOLIISENCOSÙY-LE
ONCR¡EF
Honorable Don Cosby, Judge
June 2I,2022
Page 3
of any right to bring a derivative action." 169 4.D.3 d at 424. Contrary to the
argument made by MoncriefPartners' counsel atthe hearing, there is no express
prohibition of the right to derivative relief located anywhere in the Moncrief
Partners' Partnership Agreement.
3. Plaintiffs non-signatory argument is also without merit. It is
uncontroverted that the Management Trust itself is a party and signatory
(through Tex Moncrief) to the MoncriefPartners' Partnership Agreement. And,
it is defined as a "Partner" under the Agreement. Although there is now a
dispute as to who the successor Trustees (to Tex) of the Management Trust are,
there is no dispute that the Management Trust is a limited partner, is a signatory
to the MoncriefPartners' Partnership Agreement, and is bound by the arbitration
clause. The exceptionally broad arbitration provision mandates arbitration "for
the resolution of any dispute, difference or question, as to any matter
whatsoever, which cannot be otherwise resolved...between any ofthe Partners"
and requires arbitration of any such dispute under the AAA Rules. This provides
clear and unmistakable evidence that any dispute as to who the Trustees are
under the Management Trust was intended by the signatories (including the
Management Trust through Tex) to be arbitrated. The issue as to who the correct
Trustees are under the Management Trust comprises the merits of one of the
disputes between the Partners subject to resolution during arbitration. It is
well-settled that atrialcourt cannot consider or resolve the merits ofthe dispute
in deciding whether there is a valid and binding arbitration clause. See AT&T
Techs., Inc. v. Commc'ns I4lorkers of Am,,475 U.S. 643,649 (1986); Henry
Schein, Inc. v. White Sales, Lnc.,139 S.Ct. 524,529 (2019);Universal Computer
Inc. v. Dealer Solutions, L.L.C., 183 S.W.3d '741, 749 (Tex'
óis.,
App.-Houston [1'tDist.] 2005,pet. denied),cert, denied,549U.S. 1031 (2006)
(Bland, J .); In re Wachovia sec., LLc,3 12 S.W .3d243,249 (Tex. App.-Dallas
2010, orig. proceeding). Plaintiffls entire argument is based on asking Your
Honor to improperly resolve the merits of the parties' dispute as to who the
Trustees of the Management Trust ffe, when that dispute is subject to
arbitration.
t t¡oLÀIS 0NCOSBY{ETER-.¡trd
C¡KlrbrrnUULh\tslLES\ÀlONcR¡Er
Honorable Don Cosby, Judge
June 21,2022
Page 4
Intervenor respectfully requests that the Motion to Strike be denied and
that its Motion to Compel Arbitration and Stay Litigation be granted.
Very truly yours,
/.r/Willi.a.m [,.Kir
William L. Kirkman
wl.lrjbg
Enclosure
cc Ms. Elaine Langford (w/enclosure) vrAI.MAIL
Messrs. Philip Vickers and
Scott Fredricks (w/enclosure) VIA E.FILE AND E.MAIL
Messrs. Christian D. Tucker and
Jack E. Price, Jr. (w/enclosure) VIA E.FILE AND E.MAIL
Messrs. Andrew D. Sims and
Michael V. Fitzpatrick (w/enclosure) VTA E-FTLE AND E.MA[
Ms. Kathy Patrick (w/enclosure) VIA E-FILE AND E-MAIL
Mr. Robert J. Myers (w/enclosure) VIA E-FILE NTD E.MAIL
Mr. David J. Drez III and
Ms. Darla J. Gabbitas (w/enclosure) VIA E-FILP AND E-MAIL
OLMfl EñCOSDILLEmER-,rId
CrK¡h¡anUULtA\FILE$IIoNcRIEF
v. fl
E,XHIBIT 1
Talking Capital LLC v. Omanoff, 2018 WL 1030315 (2018)
' KeyCite Yellorv Flag - Negative Treatrrrent
Affimredas Modified Crpital L[.C r'. Ornanot]', N.Y.A.D. I Dept., February 7,2019
by Talking
2018 WL 1030315 (N.Y.Sup.), 2018 N.Y. Slip Op. 30332(U) (Trial Order)
Supreme Court of New York.
New York County
**L TALKING CAPITAL LLC, together with its subsidiaries Talking Capital Partners
il,LLC, Talking Capital Partners III, LLC, and Forefront Partners LLC, Plaintiffs,
Rodney OMANOFF, Omanoff America Telecom, LLC, Brendan Ross, Mark Proto,
Mudmonth,LLC, Joseph Rahman a/k/a Youssef Rahman, Christopher Lara, Intouch
Telecom,Inc., Dlitc, LLC, Voip Guardian Partners I LLC, Voip Guardian LLC,
Direct Lending Investments LLC, and Direct Lending Income Fund, L.P., Defendants.
No.650973/2017.
February 23,2018.
Decision & Order
Shirlcy Wemcr Kornt'ciclt,J
*l Motion sequence numbers 004 and 005 are consolidated for disposition.
At heart, this is an action brought by Talking Capital
LLC (the Company), its subsidiaries, and one of its membcrs against
former managing members and others for forming a competing entity. Defendants DLI TC, LLC (DLI TC), Direct Lending
Investments, LLC, Direct Lending Incone Fund, L.P. (collectively, the DLI Companies), and Brendan Ross (collectively, the
DLI Defendants) move to dismiss the amended complaint (the AC). Seq. 004. DefendantsRodney Omanoff, Mark Proto, Joseph
Rahman (collectivel¡ the Manager Defendants), OmanofÏ Arnerica Telecom, LLC (OAT), Mudrnonth, LLC (Mudmonth),
Christopher Lara, InTouch Telecom, Inc. (InTouch), VoIP Guardian Partners I LLC, and VoIP Guardian LLC (together', the
VolP Companies) (collectivel¡ the Omanoff Defendants) the Company,
separately move to dismiss the AC. Seq. 005. Plaintiffs,
Talking Capital Partners **2 II, LLC (TCP II), Talking Capital Partners III, LLC (TCP III; and together with TCP II, the
LLC (Forefi'ont),
Subsidiaries), and Forcfront Partners, oppose both motions. For the reasons that follow, defèndants'
motiorrs
are granted in part and denied in part.
I. Føctual Background &. Procedural History
As this is a motion to dismiss,the facts recited are taken from the AC (Dkt. 62)l and the documentary evidence submitted
by the panies.2
"Dkt." followed
References to by a number rcfer to documents filed in this action on the New York Filing
State Courts Electronic
systenr (NYSCËF).
Talking CapitalLLC v. Omanoff,2018 WL 1030315 (2018)
2 fàctual averments in defendants'affidavits (such as Ross'clairn that DLI TC was not given a
Th" court, however, will not consider
certain contractually on a nrotion to dismiss. See Busi.c I'icÌd :ll¡tlm l;und (Musterl
lequile notice) because they are inadrnissible v
Goldnun Such'' Gt oup, lnc., I I 5 AD3d I 28, I 34 n.4 ( I st Dept 20 l4), accotd lìovello v' Orolino lleult.y Co.,10 NY2d ó3-1, ó3a ( l9?{i);
Inc.,l20ADld43l,432(lstDept20l4)("Wehaveheldthat
.çeealso¡lm:¡tt,tdantltospitulitl'(ìroup,LLCvll,larshall-Alu¡¡1.ç.ç¿rcs.,
that'do no more than asseft the inaccuracy ofplaintiffs'allegations [ ] may not be considered. in the context ofa motion to
affrdavits
dismiss, for the purpose of detennining whether there is evidentiary conclusively
support for the complaint... and do not otherwise
establish a delense to the asserted clainrs as â nìåtter of law."), quoling Ilsiuern¡an
v A D3d 242
Jrno.lJ,40 ( I st
Dcpt 200 7 ).
In 2014, non-party Bradley Reifler, acting on behalf of Forefront,l
negotiated and agreed with Omanoff, Proto, and Rahman
to crsate the Company, a Dela\ilare LLC based in New York. The Company provides fìnancing to telecommunications finrìs
calls. The Company was in the factoring
that route international business;it would lend money to telecolns in exchange for a
percentage of their accounts receivable.
3 R.ifl",claims to be
amanagcr of Foretì'ont. S¿¿ Dkt. 102 at
I.
The Company is govemed by an operating agreement dated September 8, 2014. See Dkt. 63 (the Operating Agreement).4 tts
three Members - Forefront, OÄT, and Mudmonth - are **3 LLCs controlled by Reifler,Onranoff, and Proto, respectively, and
eachhadaone-thirdinterest. Seeid.at63-64.Sections5.l and5.4oftheOperatingAgreementprovidethattheCompanyis
to be controlled by a Board of Managers (the Board), consisting of three Managers - Reifler, Omanolï, and Proto. See id. at
8-9, 64. Rahnlan worked for the Company and was named in section 5.1 I as a "Tax Matter Partner" along witlr Omanoffand
Rieflcr. See id. at l4-15.
4 concerning somc olthc defcndants' represcntations about their cxperience and the state ofthe factoring
Plaintiffs'allegations market
areofnomonrcnt,notjustbecauseofalackofanyallegedduediligence,butalsobccausccachnrcmberwarrantedinsection ll.l
Agreenrent that: "By reason of his ... business or financial experience, or by reason of thc busincss or frnancial
of the Operating
experience ofhis ... financial advisor... he ... is capable ofevaluating S¿e Dkt. 63 at2l.
the risks and rnerits of... this investnrcnt."
that the members are "financially able to bear the economic
Likewise, section I1.4 provides risk of losing their entirc investment.
Seeid. at 22. Regardless,
ptaintift's do not assert a claim for íÌaudulent inducement.
*2 Scction 1.5 states, in bold, that'rNotwithstanding anything
to the contrary set forth herein,
it is agreed and understood
that the affirmative vote, consent or approval of ail the Managers is required for every act or decisiondone or made by
the [Boardl." See id. at 2 (bold and underline in original; The Company's purpose is set forth
italics added for ernphasis).s
in section 2.6, which provides that the Company's factoring clients would includesmall and llledium sized telecorns(Tier 3
Can'iers) that were awarded contracts by "major" telecoms (Tier I Cariers), such as Verizonand AT&T. See id. ¿tt 4. Section
2.6 further providesthat the Board **4 is authorized to form subsidiaries to purchase
accounts receivable of Tier I Carriers
from Tier 3 Caniers. See id. at4-5.
5
A provision to this effèct can be found in rnultiple sections of the Operating Agreement.
Iror instance, section 4.7, which addresses
how votirrg interests arc to be commensurate with the members'percentagc
interesls, concludes, again in bold, that "Notwithstanding
anything to the contrary set forth herein, it is agreed and understood that the affirmativc ofall the
vote, consent or approval
Members holdingåll lnterests is required tor every act or decision done or ntade by the Members." S¿¿ Dkt. 63 at 8 (bold and
underlinein original;
italics added for enrphasis); see also rd. at 9 (Notwithstanding anything to the contrary
sct forth he rein,
it is agreed and understoodthat the affirmative or approval of all the Managers
vote, consent is required for every act or
decision done or made by the lBoardl unless a majority of those present of three meml¡ers present authorize
one member to
take action in a specifìc matter.") (bold and underline
in original). Likewise, section 4.9(a) requires "all" members to call rrrcctings,
and requires written consents in lieu of a meeting to be signed by "all" members. see id. al g.
Sections 2.8 and 5.5 contain exculpatory clauses that restrict the liabilify of Menrbers
and Managers to acts such as gross
negligence and fraud. See id. at 5, 13. Section 2. IO(b) states that the Opcrating
Agreentent is only intended to benefit the
çtlESTtfiW ,r:r.' rr
l!,',:,ì..:,. ,.,,, .i . ¡.:-,,, tír .
,, , ,,i,,j I i.: .. ,,, ,.:r
;,..:., ,
Talking CapitalLLC v. Omanoff,2018 WL 1030315 (2018)
Company's Members, that it "is expressly not intended for the benefitof any creditor of the Company or any other Person,"
See id, at 5. The Operating Agreement contains
and tlrat no other party shall have any rights under the Operating Agreement.
all their time to the Company,
partial disclaimers of the duty of loyalty.ó Section 5.6 states that the Managers need not devote
but rnay "devote whatever time, effort, and skill as they deem appropriate." See id. at 14. Section 5.7, which governs conflicted
transactions, pennitsthe Managers to "engage in any transaction ... with the Company so long as:
and their Affìliates
6 SoeAurigaCapira! Corp.vGur'Prop.r.,40A3d839,85l(Del Ch 2012\,afi'd59A3d 1206(Del 2012)(Delawarelawilnpartsdefault
fiduciary duties on managing members of an LLC).
(i) such transaction is not expressly
prohibited on an overall
by this Agrcement and the terms and conditions of such transactìon,
basis, are fair and reasonable to the Company and are at least as favorable to the Company as those that are generally available
from Persons capable of similarly performing them and in similar transactions
between parties operating at arm' lengtlt and (ii)
such transaction has been consented to in writing by the Members holding all interests.
1d. (emphasis added). I{oweveç the Operating Agreerrrent does not permit Members or Mangers to appropriate cotporate
opportunitieswithout the consent of the other Members.
*3 In section5.5, the Members agreed they would otherwise be subjectto thc fiduciary duties applicable undel Delaware law
and not those duties **5
to directors of a corpolation,T applicable to pañners. See id. at 13. In other words, aside from the
Operating Agreement's fiduciary duty waiv-ers and exculpatoryclauses, the Cornpany is governedlike a colporation.
7 Absent a lìduciary duty waiver in an operating âgreement, Delawa¡e corporate law mandates of entire làirness scrutiny
application
Miller y llCP & Co.,2018 V/L
to conflicted transâctions. See ó-56378, at *2
(Dcl Ch 2018).
In practice, "Ornanoff was principally in charge of managing all day-to-day operations,including procuring financing
opporlunities relating to overseastelecom providers and supervising [the Company's] New York offices,"while Forefront
"concenh'ated its efforts on raising capital for [the Company] and its affrliates." See AC ]n 25-26. ln that regard,
Reifler
introduced the other Managers to Ross, whose DLI Companies could frnance the Company's factoring business. Allegedly,
"Ross came to New York on at least three occasions to meet with the represenlatives of fthe Company] and entered into
negotiations to provide loans to [the Company] and its affìliates."
AC fi 28. "The negotiations in New York proved
successful and
companies in2014 to early 2016," f130. The loans were made to wholly owned
led to a series of loans made by Ross's affrliated
subsidiaries of the Company, TCP Il and TCP III, which were formed pursuant to section 2.6 of the Operating Agreement.s
"The total arì'roullt of loans issued by Ross's affiliated companies
amounted $ I 80 rnillion (including renewals
to approxirnately
and rollovers 1i 3l. "Given this magnitude, Ross's affiiiated companies
of prior financings)." became the leading lending source
for [the Company and Subsidiaries]."'!f
32.
8 Th" Subsidiaries, also Delarvare LLCs, do not have separate operating agreements.
Plaintifß conclusorily allege they operated
undcr
the Company's Operating Agreernent. This allegation is not supported by any documentation. Since the Operating Agree nent requircs
unanitnousconsent, the Conrparry's subsidiaries could not have "adopted" the Operating Agreement consent of
without unaninlous
the Members. Forefront
does not allegc that the other Menrbers unanimously
agreed. In any event, as noted herein, Forefront is not
aggrieved by the holding that the Subsidiaries are not govemed by the Operating
Agreement because that fact actually may result in
the OrnanoffDefendants having broader
liability (e.g., due to no fiduciary duty waivers and exculpatory
clauses).
"Tlre first set of ioans were made in the fail of 2014 totaling $7 million, pursuant to two promissoly notes each in the sum of
$3.5 million (the "lnitial Loans"). The Initial Loans wele **6personally guaranteed by [ReiflerJ." fl 33. "'fhe Initial Loans
were timely repaid witlt interest and led to a number of subsequent
loans in 2015 pursuant to a certain Master Receivablefs]
Purchase and Scrvicing Agreement dated as of December 1,2014." 'tl 35; sec Dkt. 70 (the PSA). The
pSA is an agreement
between TCP II (delinedasOriginator) and DLI TC (defined as Buyer).See id. at1.9Section 25 of the PSA provides rhat the
Talking Capital LLC v. Omanoff,2018 WL 1030315 (2018)
22. ln section 2T(a),the parties to the PSA submitted
PSA, and âll matters rclated to it, are governed by New York law. See id.
aL
to the jurisdiction
ofNew York courts in any action relating to the PSA,Ì0subject to the following
caveat:
9 enters into Factoring Agreemenls with Merchants, under which the Origìnator
Th. PSA's whereas clauses explain that "the Originator
that "pursuant to
under a Carlicl Agreement";
agrccs to purchasc from thc Merchant Receivables from Customcrs for service provìtled
this Agreement, Oliginator will prnvide a Credit Package (as hereinafter clefined) relating to a Merchatlt and each Calrier Agt-eentent
relating to Receivables that the Originator proposes to sell to Buyer"; thal "Originatol has agleed to provide Buyer with an cxcl¡"tsive
terrs and conditions set forth below"; and that "if Buyer exercises
Purchasc Option on th€ tlie Pul'chase Option. Buyer will pulchase
under the subject Factoling Agreement,
the Receivables generated ¡t
sct forth herein." S¿¿ Dkt. 10
oll thc tenns and conditions 1.
to the instant
the courf linlits ils discussion to the poltions of the PSA that âre relevant
While thc PSA is an extensive agleelïent,
motions. It should be noted that seclion 23 olthe PSA provides that:
and Buyer shall be that of independent contractors.
between Originalor
The relationship lor the otheq
Neither is a truslce or agent
lor does either have any fiduciary orjoint
shall not be construed to cleate a parlnership
obligations to the other. This Agreement
venfure between the Parties. ...
Ðkt,70 at22.
l0 I1should bc noted that, unlikc thc PSA, the Operating Agreement does not contain a fon¡m seleclion cìause.
*4 provided, will not
each party agrces that it commence in the first
any such action, other than regarding claims specified
sentence ofSection without first entering into good faith discussions with the
l0(b) [i.e., concerning a breach ofwarranty],
othcr pårty for a period of not less than thirty (30) days, in an effort
to amicably resolve any such differences, **7 Id.
(emphasis added). In other words, this meet and confer obligation is a procedural
condition precedent toDLI 'l'C'sconsent to
jurisdictionin this court.
Section 2 of the PSA provides DLI TC with a right of first refusal to finance the Company's telecom factoring. See id. at 5-7 .
Section 2(a) scts forth the information that must be provided to DLI TC ând requires that tiris information
be sent by email and
made available on a Credit Website. See id. at 5. DLI TC could exelcise its right of first refusal "by inciicating its approval to
purchase the Receivables covered by the Credit Notice in a reply email ... withinfour (4) BusinessDays afler the Effective
Offcr l)ate." See id. al
6.
The PSA had a five-year tel'm, subject to early termination under certain conditions set forth in section 16. See id. at 18.
Section l8(d) contains a restrictive
covenant that prohibits DLI TC, its principals, "in any business
and aft'iliates frorn engaging
prclviding trade financeor factoring services to telecommunications carriersin connection wilh voice over internetprolocol
(VoIP) services outside of the PSA while the PSA is in effect and for two years thereafter." See id. at 20-21. Furthet section
l8(e) plohibits DLI TC, its principals,
and affiliaies fi-orn soliciting customel's and employees
of the Company and its affiliates
period. See id. af 21. Section l8(l; states that "ft]he restrictions
during this restriction set forth ìn this Section 18 ale considered
by the Parties to be reasonable for the purposes of protecting the value of their respective
businesses and goodwill and respecting
applicable legal and contractual requirements"; that provides that "li]fany p¡ovision
contains a "blue penciling" provision ofthis
Section I 8 relating
to the time period, scope of activities
or geographic area of re strìctions is declared by â courT of compctent
jurisdictionto exceed the maximum perrnissible tirne period, area, each such plovision
scope of activities or geographic shall
be reduced to the maxi¡¡um which such coul deems **8 enforceable"; and provides for recovery of attorneys' fees in an
action to enforce section18. See íd.
According to plaintiffs, the Company initially "operated successfully for more than a years' time, earning
combinecl profits with
its lcndersand capital paftners of approximately$7 nillion." S¿¿ AC Jl 39. However; problems alose in 2016 with loans TCP
III nade to a llritish 1ìer 3 Carrier, Bolotel Linlited (Bolotel).
l'he loans to Bolotel
(the tsolotelTransactions) were rnade in
considcration ftlr the right to Tier I Can'icr accounts receivable
owned by an ltalian telecom conlpany,AV Paftncrs, SRL (AVp),
a subsidiary of Logica SRL (Logica), anotherItalian company which had been in ba¡kruptcy since 20 i 0. 'i'he circumstances
of
the Bolotel Transactionsâre nol explained with nluch detail ìn thc AC other than with general allegations irnplying impropriety
on the part of Manager Defendants,who supposedly failed to consider
the bankruptcy. For cxample,plaintifß allege:
"Omanoff,
Talking CapitalLLC v. Omanoff,20l8 WL 1030315 (2018)
Proto, Rahman and/or Lara structured and executed the Bolotel Transactions down to every last detail and [Foreflont]
had no
involvement in the underwriting or due diligenceof Bolotelor AV Partnerr."ll1¡43.
II 'l'he AC does not explain how due diligence on thc credit risk associated
with the Company's factoring rvas ordinarily
perfornred or
how/why that process failed with the Bolotel Transactions
other than alleging thc Logica bankruptcy was overlooked. These omissions
il
nrust be rcmedied as explained hercin, Forefront sceks lcave to an.ìcnd to asscrt a non-cxculpatcd
Carcmark claim.lfall thât can be
Forefront should not seek leave to replead as doing so would be futile.
alleged is sinrply that the Logica bankluptcy was overlooked,
*5 Plaintiffsalso suggest misconduct on the part of the DLI Defendants. They contend that, under section 2 of the PSA,
DLT TC was given the opportunity to participate in the Bolotel Transactions, but that Ross declined.l2
Plaintiffs, however, do
not allege when or how Ross was **9 given notice, nor do they allege that the requisite electronic notices were provided
as
required by section2(a) of the PSA. They rnerely allege the following:
I
t¿
','ì
While paragraph55 olthe original complaint stated something different /see Dkt. 127 at 16),defendants do not cite any controlling
for the proposition
authority allegations behveen pleadings in tlte sante actlorr necessarily have preclusive
that conflicting effect on a
challenge to the finder offact. The authority cit€d by defendants
to being a lrasis to mount a credibility
nrotion to dismiss, as opposed
when conflicting
concerÌrs allegations prior litigation constitute judicial admissions.
in LLC v Citco
L.it. 7'tttst.
S¿e N¿,1' G¡e¿'nwich
I''und S¿tts. (Europc) ll.V., 145 AD3d I ó,
st Dept 20 I ó). Probing the reasons for the prior allegation (e.g., mistake vs. dishonesty)
2,5 ( I
is fair gamc for discovery.
During the period of time ieading up to the Bolotel Transactions,
Omanoff was in regular contact with Ross and his affiliated
finance cornpanies,and consistent with the pafties'course of dealing they were prescntcd with the opportunity to participate
It was rcpofted
in the Bolotel Transactions. to Forefi'ont Partners that Ross declined to participate in the Bolotel Transactions
because the financialinfor¡nation associatedwith the Bolotel Transactions was either incompletc or inadequatc and did not
meet Ross's undenvriting criteria.
AC lTll 44-45 þaragraph breaks omitted).1'l Plaintiffs claim, without particulars
or explanation, "that Omanoffand the other
individual