Macquarie Rotorcraft Leasing Holdings Limited v. LCI Helicopters (Ireland) Limited

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
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In re: 	:
: 	Chapter 11
WAYPOINT LEASING HOLDINGS LTD., 	:
et al., 	: 	Case No. 18-13648 (SMB)
:
Debtor 	: 	Jointly Administered
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:
MACQUARIE ROTORCRAFT LEASING 	: 	Adv. Proc. No. 19-01107 (SMB)
HOLDINGS LIMITED, 	:
:
Plaintiff, 	:
:
- against - 	:
:
LCI HELICOPTERS (IRELAND) LIMITED, 	:
:
Defendant. 	:
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MEMORANDUM DECISION GRANTING
DEFENDANT’S MOTION TO DISMISS THE FIRST AMENDED
ADVERSARY COMPLAINT WITH PREJUDICE
A P P E A R A N C E S:
PAUL HASTINGS LLP
200 Park Avenue
New York, New York 10166
G. Alexander Bongartz, Esq.
Of Counsel
-and-
71 S. Wacker Drive, Suite 4500
Chicago, Illinois 60606
Chris L. Dickerson, Esq.
Mark D. Pollack, Esq.
Nathan S. Gimpel, Esq.
Michael C. Whalen, Esq.
Of Counsel
Attorneys for Plaintiff Macquarie Rotorcraft
Leasing Holdings Limited
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MANATT, PHELPS & PHILLIPS, LLP
7 Times Square
New York, New York 10036
Andrew L. Morrison, Esq.
Samantha J. Katze, Esq.
Vincent C. Papa, Esq.
Of Counsel
Attorneys for Defendant LCI Helicopters
(Ireland) Limited
STUART M. BERNSTEIN
United States Bankruptcy Judge
This dispute between two non-debtors arises from the section 363 sale of certain
assets (the “WAC 9 Assets”) owned by Waypoint Leasing Holdings Ltd. and its debtor
affiliates (collectively, “Waypoint” or “Debtors”) to non-party Lombard North Central
plc (“Lombard”). The Plaintiff Macquarie Rotorcraft Leasing Holdings Limited
(“Plaintiff” or “Macquarie”) was the stalking horse bidder for substantially all of
Waypoint’s assets and ultimately, the disappointed bidder for the WAC 9 Assets.
Macquarie now blames the loss of the sale and/or a $19.5 million break-up fee and an
expense reimbursement capped at $3 million on the Defendant LCI Helicopters
(Ireland) Limited (“Defendant” or “LCI”).
Macquarie commenced this adversary proceeding seeking damages against LCI
in its capacity as assignee of the Debtors and in its own right. (See First Amended
Adversary Complaint, dated May 14, 2019 (“AC”) (ECF Doc. # 7).1 LCI moved to
dismiss the AC with prejudice. While Macquarie has opposed LCI’s motion, it has not
1 	“ECF” refers to the docket in this adversary proceeding. “ECF Main” refers to the docket in
Waypoint’s chapter 11 cases.
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addressed the request for dismissal with prejudice or asked for leave to replead any
dismissed claims. Furthermore, the AC represents Macquarie’s second attempt to plead
viable claims. 2 Accordingly, the AC is dismissed with prejudice for the reasons that
follow.
BACKGROUND3
A. 	The Waypoint Bankruptcy and Sale Process
At all relevant times, Waypoint was engaged in the business of owning and
leasing helicopters. The Debtors filed their chapter 11 petitions on November 25, 2018.
(¶ 10.) Prior to the bankruptcy filing, the Debtors engaged in an out-of-court marketing
process to sell substantially all of their assets. 4 (¶ 11.) LCI was involved in the early
stages of the marketing process and signed a non-disclosure agreement (“NDA”) on
August 29, 2018 which enabled LCI to acquire confidential information from Waypoint
relevant to the proposed sale. (¶¶ 11, 12.) 5
The NDA imposed two limitations on LCI that figure into this dispute. The first
limited LCI’s use of the confidential information “solely for the purpose of evaluating
and participating in discussions with the Company . . . .” (¶ 12; NDA § 2.) The second
2 	Macquarie filed the AC in response to LCI’s motion to dismiss the original complaint.
3 	The Background discussion is derived from the AC and the documents attached to and/or relied
on in the AC. The notation “(¶ __)” refers to the paragraphs in the AC.
4 	The Debtors owned groups of assets segregated into “silos” called Waypoint Asset Cos., or
“WACs.” Each WAC had its own lenders whose claims were secured by the assets of that WAC. The
WACs were differentiated by number, and the assets (or equity) involved in the sale included WACs 1, 2,
3, 5, 6, 8, 9 and 12. (See Bidding Procedures p. 3 (defined in the succeeding text).) This matter concerns
only WAC 9.
5 	A copy of the NDA is annexed to the AC as Exhibit A.
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precluded contact with certain designated persons, including any “creditor . . . or other
commercial counterparty of the Company or any subsidiary of the Company regarding
the Company or its business [or] assets.” (¶ 25; NDA § 4.) The NDA carved out contact
and communications that “may occur in the ordinary course of [LCI’s] business” on
matters unrelated to LCI’s possible transaction with Waypoint, (NDA § 4), and provided
that nothing in the NDA “impair[ed]” LCI’s “ability to conduct . . . business with any
third parties in the ordinary course” so long as LCI did not “disclose or refer to” its
potential transaction with Waypoint or confidential information obtained pursuant to
the NDA. (NDA § 2(a).)
On December 7, 2018, Macquarie entered into a Stock and Asset Purchase
Agreement (“Macquarie APA”) with the Debtors to buy substantially all of Waypoint’s
assets, including the WAC 9 Assets, for $650 million. (¶ 15; ECF Main Doc. # 64, Ex.
C).) 	Three days later, the Debtors filed their motion to establish bidding procedures
and approve the sale. (Motion of Debtors for Entry of Orders Approving: (I) (A)
Bidding Procedures, (B) Bid Protections, (C) Form and Manner of Notice of Auction,
Sale Transaction, and Sale Hearing, and (D) Procedures for the Assumption and
Assignment of Certain Executory Contracts and Unexpired Leases; and (II) (A) Sale of
Substantially all of the Debtors’ Assets Free and Clear of Liens, Claims, Encumbrances,
and Other Interests, (B) Assumption and Assignment of Certain Executory Contracts
and Unexpired Leases, and (C) Related Relief, dated Dec. 10, 2018 (“Bidding
Procedures Motion”) (ECF Main Doc. # 64); ¶ 16.) The Bidding Procedures Motion
elicited objections from the Debtors’ secured creditors, including Lombard, the creditor
secured by a lien on the WAC 9 Assets. After further negotiations among the parties, the
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Court entered the Order Approving (A) Bidding Procedures, (B) Bid Protections, (C)
Form and Manner of Notice of Cure Costs, Auction, Sale Transaction, and Sale
Hearing, and (D) Date for Auction, if Necessary, and Sale Hearing, dated Dec. 21, 2018
(“Bidding Procedures Order”). (ECF Main Doc. # 159; see ¶ 17.)
The bidding procedures attached as Exhibit 1 to the Bidding Procedures Order
(the “Bidding Procedures”) set up a process for third-party bidding and credit bidding.
Because third parties and/or the secured parties could bid on a WAC-by-WAC basis,
Macquarie had to allocate its $650 million bid among the eight WACs. (See Bidding
Procedures p. 2.) After the deadline for third-party bids, the secured parties could
credit bid in one of two prescribed forms. Macquarie was entitled to a breakup fee in the
sum of $19.5 million plus an expense reimbursement of up to $3 million under the
Macquarie APA, unless, inter alia, a transaction was effected through a credit bid.
(Bidding Procedures Order ¶¶ 8, 10.) In addition, if Lombard made a credit bid for the
WAC 9 Assets in the full amount of its claim, Macquarie could not submit a matching
bid. (Id. ¶ 4.)
The Bidding Procedures also modified the “no contact” provisions in the NDAs
that the secured creditors and prospective bidders, including Lombard and LCI, had
signed. The secured parties could engage in discussions and negotiations with an entity
to manage the assets upon the consummation of a successful credit bid (“Alternative
Asset Manager”) and were released from any restriction on “engaging in discussions or
negotiations” under their agreements with the Debtors, retroactive to December 12,
2018, “provided, that the Debtors, WAC Lenders, WAC Facility Agent, and Credit Bidco
shall, prior to any disclosure to any such Alternative Asset Manager of any confidential
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information, agree (with each such party acting reasonably and in good faith) on the
scope of information to be provided to such Alternative Asset Managers (taking into
account commercial sensitivities and antitrust and other applicable law).” (Bidding
Procedures p. 5.)
B. 	The Auction and Sale Hearing
No third party submitted a bid, leaving only Macquarie and the secured lenders
as potential purchasers. Lombard submitted a credit bid for the WAC 9 Assets in the
amount of 100% of its claim. (¶ 23.) The gravamen of the Plaintiff’s claims is that
Lombard entered into a secret deal with LCI in violation of the NDA and the Bidding
Procedures to sell it the WAC 9 Assets following the consummation of the credit bid.
(¶ 20.) In Macquarie’s view, Lombard’s bid was actually a joint, collusive bid by
Lombard and LCI that deprived the Debtors of the opportunity to get a higher and
better bid, prevented Macquarie from acquiring the WAC 9 Assets and deprived it of its
break-up fee and expense reimbursement. (¶ 38.)
Evidence submitted by Lombard in support of the approval of its credit bid
provided some evidentiary support for Macquarie’s position. In response to
Macquarie’s limited objection, Lombard filed the affidavit of Ms. Jacqueline McDermott
on February 11, 2019. It disclosed that Lombard was “discussing with its servicer a
subsequent transaction pursuant to which the [WAC 9 Assets] would be recapitalized
and sold to the servicer.” (¶ 28.)
At the hearing the next day, Macquarie’s counsel framed the issue succinctly:
“what they’re seeking to do is eliminate the breakup fee.” (Transcript of Feb. 12, 2019
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Hr’g (“Tr.”), at 166:16-17 (ECF Main Doc. # 537) (cited in ¶¶ 29-31).) He did not object
to the receipt of Ms. McDermott’s affidavit as her direct testimony, (Tr. 163:14-22), and
then subjected her to a vigorous cross-examination regarding Lombard’s negotiations
with servicers to sell the WAC 9 Assets following the consummation of the credit bid.
She testified that from the beginning of Lombard’s negotiations with Macquarie as the
Debtors’ proposed stalking horse bidder, Lombard made it clear that if Macquarie
wanted to acquire the WAC 9 Assets, “they needed to pay par plus accrued interest.”
(Tr. 186:14-20.) Lombard was a lender, not a helicopter leasing company, (Tr. 194:24-
195:5), and intended to sell the WAC 9 Assets at some point in the future. (Tr. 189:2-11;
194:3-5.) Lombard had some preliminary discussions with potential servicers, but the
servicers did not have necessary information about the aircraft or the leases, Lombard
did not disclose any confidential information about the aircraft or the leases, it had no
agreement to sell the assets, and any sale discussions were premature. (Tr. 187:4-23;
188:22-189:1; 189:12-23; 192:20-194:23.)
Mr. Matthew Neimann of Houlihan Lokey, the Debtor’s financial advisor, also
took the stand and was cross-examined by Macquarie’s counsel. He testified that
Houlihan Lokey never consented to Lombard sharing information regarding anything
other than servicing. (Tr. 225:15-23; see ¶ 30.)
After all parties rested, (Tr. 226:8-16), the Court heard closing arguments.
Macquarie’s counsel maintained that Lombard had violated the confidentiality and “no
contact” provisions of its own non-disclosure agreement (“Lombard NDA”) and had
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entered into a collusive bidding agreement with LCI. 6 These actions deprived
Macquarie of its break-up fee and precluded a finding that Lombard had acted in good
faith under 11 U.S.C. § 363(m). When the Court questioned the sufficiency of the
evidence of Lombard’s breach of the confidentiality provisions of the Lombard NDA,
(Tr. 243:19-244:6), Macquarie’s counsel suggested that the Court should allow it a brief
period of discovery. (Tr. 245:3-4.) When the attention turned to the “no contact”
provision and the hypothesis that Lombard would not have bid but for the agreement to
resell the WAC 9 Assets to LCI, Macquarie’s counsel again suggested that more
discovery might be in order. (Tr. 248:16-21.)
The Court rejected Macquarie’s belated request for discovery. The possible
violation of the NDA and collusive bidding had been raised by Macquarie in its objection
to the sale of the WAC 9 Assets to Lombard. (See Limited Objection of Macquarie
Rotorcraft Leasing Holdings Limited Relating to WAC 9 Credit Bid Transactions and
Related Form of Purchase Agreement and Sale Order, dated Feb. 5, 2019 (“Macquarie
WAC 9 Sale Objection”) (ECF Main Doc. # 339).) In addition, the sale hearing was an
evidentiary hearing under the Court’s Local Bankruptcy Rule 9014-2(c), and the process
was expedited by its very nature. (Tr. 248:22-249:3.) Macquarie never sought
expedited discovery.
The Court ruled from the bench at the conclusion of the hearing. (Tr. 250:8-
253:3.) It first ruled that Lombard, not Lombard and/or LCI, was the credit bidder for
the WAC 9 Assets and Macquarie was not entitled to a break-up fee based on Lombard’s
6 	Although potential third-party bidders like LCI and secured creditors like Lombard signed
slightly different NDAs, (Tr. 214:20-23), the material terms were substantially the same.
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successful credit bid. (Tr. 250:8-16.) The Court also concluded that there was no
evidence that Lombard had shared any confidential information with any servicers,
including LCI. (Tr. 250:24-251:9.)
The “no-contact” provision of the Lombard NDA was a different story. The
evidence showed that Lombard had discussed the possibility of a future sale of the WAC
9 Assets with LCI. However, the Court discounted this possible “technical violation” of
the Lombard NDA because it did not affect the bidding process. (Tr. 251:9-12.)
Furthermore, Lombard did not act in bad faith when it started to look around for a
subsequent purchaser. Lombard was a lender that intended to liquidate its collateral
and get paid back. It did not want to incur the costs of insuring the aircraft and paying a
servicer. (Tr. 251:12-21.)
The final ruling concerned Macquarie’s objection to the scope of the release that
the Debtors were giving to Lombard because Macquarie would be acquiring certain of
the Debtors’ claims under the Macquarie APA. The Court observed that the release was
consistent with the Bidding Procedures Order except that it now was more limited
because it excepted claims based on willful misconduct and gross negligence. (Tr.
251:21-252:1.) If Macquarie wanted to sue Lombard as the Debtors’ successor arguing
that Lombard had engaged in the type of conduct carved out of the release, it was free to
do so:
And you can make the argument, Mr. Edelman [Macquarie’s counsel], that
if you’ve gotten that claim and somebody knowing violated, I guess, a
provision restricting the use of confidential information, they engaged in
willful misconduct but that’s for another day.
(Tr. 252:2-6.)
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The Court signed the order approving the sale of the WAC 9 Assets to Lombard
pursuant to their credit bid the next day. (Order (I) (A) Approving Purchase
Agreement Among Debtors and Successful Credit Bidder, (B) Authorizing Sale of
Certain of Debtors’ Assets Free and Clear of Liens, Claims, Encumbrances, and Other
Interests, and (C) Granting Related Relief, and (II) Authorizing Debtors to Take
Certain Actions With Respect to Related Intercompany Claims in Connection
Therewith, dated Feb. 13, 2019 (“Lombard Sale Order”) (ECF Main Doc. # 441).) The
Lombard Sale Order included findings that Lombard’s credit bid complied with the
Bidding Procedures Order and it was the successful bidder for the WAC 9 Assets
(Lombard Sale Order ¶ G), that Lombard was a good faith purchaser under section
363(m) and had “complied with the provisions of the Bidding Procedures Order,
including compliance in all material respects with confidentiality obligations and
restrictions under . . . any applicable . . . non-disclosure agreement,” and neither the
Debtors nor Lombard had “engaged in any conduct that would cause or permit the
Purchase Agreement to be avoided or costs and damages to be imposed under section
363(n) of the Bankruptcy Code.” (Id. ¶ J.) The Court also found that the sale process
resulted in the “highest and best value” for the WAC 9 Assets, (id. ¶ H), and was binding
on, among others, the Debtors, Lombard and “any affected third parties.” (Id. ¶ 35.)
Macquarie asserts, upon information and belief, that LCI subsequently purchased
the equity of the WAC 9 Assets from Lombard on March 7, 2019. (¶¶ 35-36.) According
to section 3.01 of the Amended and Restated Equity and PPN Purchase Agreement
attached to and approved by the Lombard Sale Order, the purchase price for the WAC 9
Assets as of the expected closing date of February 15, 2019, was $60,464,373.77 plus
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€33,588,431.00, corresponding to the amounts owed by the Debtors to Lombard on the
U.S. Dollar tranche and Euro tranche, respectively, under the parties’ credit agreement.
(Lombard Sale Order, Ex. A, § 3.01.) The Court takes judicial notice that as of the close
on February 15, 2019, the Euro was equal to $1.1292. Accordingly, the amount of
Lombard’s credit bid and the purchase price for the WAC 9 Assets was $98,392,430.06,
rounded up to $98.4 million.
The Court signed the order approving the sale of certain other assets to
Macquarie on February 14, 2019. (Order (I) Approving Purchase Agreement Among
Debtors and Macquarie, (II) Authorizing Sale of Certain of Debtors’ Assets Free and
Clear of Liens, Claims, Encumbrances, and Other Interests, (III) Authorizing
Assumption and Assignment of Certain Executory Contracts and Unexpired Leases in
Connection Therewith, and (IV) Granting Related Relief, dated Feb. 14, 2019
(“Macquarie Sale Order”) (ECF Main Doc. # 444).) The Macquarie Sale Order
provides, among other things, that any damages flowing from violations of the Bidding
Procedures or Bidding Procedures Order “arising from intentional misconduct” are
preserved, and upon the closing, were assigned to Macquarie pursuant to the terms of
the Macquarie APA. (Macquarie Sale Order ¶ 42.)
B. 	This Adversary Proceeding
Macquarie’s AC asserts three claims. Count I, asserted in its capacity as assignee
of the Debtors, alleges that LCI breached the confidentiality and “no contact” provisions
in its NDA with the Debtors through its improper contact with Lombard regarding the
sale of the WAC 9 Assets and injured the Debtors “by depriving the Debtors of obtaining
potential competing cash bids for the WAC 9 assets and the additional value that such
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bids may have realized.” (¶ 43.) Count II, asserted in Macquarie’s own right, contends
that LCI tortiously interfered with its business relationship with the Debtors under the
Macquarie APA, and but for LCI’s interference, Macquarie would have purchased the
WAC 9 Assets or earned a break-up fee. (¶¶ 46, 49, 51.) Count III, asserted both in
Macquarie’s own right and in its capacity as assignee of the Debtors, alleges that LCI
colluded with Lombard to control the sale price of the WAC 9 Assets in violation of 11
U.S.C. § 363(n). 7 (¶¶ 55, 57, 58.)
LCI’s Memorandum of Law in Support of LCI Helicopters (Ireland) Limited’s
Motion to Dismiss, dated May 3, 2019 (“Motion to Dismiss”) (ECF Doc. # 6) and Reply
Memorandum of Law in Further Support of LCI Helicopters (Ireland) Limited’s
Motion to Dismiss, dated May 17, 2019 (“Suppl. Motion to Dismiss”) (ECF Doc. # 9),
assert that all of Macquarie’s claims should be dismissed with prejudice for failure to
state a claim. In the main, LCI contends that Count I for breach of the NDA fails to
allege damages. (Motion to Dismiss p. 20.) Count II fails to plead the necessary
elements of a claim for tortious interference with business relations, namely, the
existence of a business relationship that LCI intentionally interfered with, malice or
improper means of interference, and damages. (Id. pp. 23-25.) Finally, Macquarie lacks
standing to assert a claim for violation of 11 U.S.C. § 363(n). (Suppl. Motion to Dismiss
pp. 9-10.) The limited exception that allows unsuccessful bidders to challenge the
“intrinsic fairness” of a transaction does not apply here, where Macquarie agreed to the
7 	Macquarie may have abandoned Counts I and III at oral argument. At the hearing, counsel for
Macquarie stated: “[I]f in fact the record demonstrates that Macquarie’s allocation was substantially less
than the credit bid, we would focus the Court on the tortious interference claim.” (Audio Recording of
June 20, 2019 Hr’g, at 10:47:25 a.m.) As discussed in the succeeding text, Macquarie’s bid for the WAC 9
Assets was substantially less than Lombard’s credit bid.
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condition in the Bidding Procedures Order that it could not match a 100% credit bid
made by Lombard. (Id. p. 10.) Even if Macquarie had standing to bring it, the claim is
not supported by any facts. (Id. p. 11.) Finally, Macquarie is raising the same
allegations that the Court heard and rejected when it approved the sale of the WAC 9
Assets to Lombard and Count III is, therefore, barred by collateral estoppel. (Motion to
Dismiss, pp. 25-29; Suppl. Motion to Dismiss, pp. 10-11.)
Macquarie asserts in opposition that the claims in the AC were not actually
decided at the February 12 hearing, but rather, were expressly preserved by the Court.
(Macquarie Rotorcraft Leasing Holdings Limited’s Objection to LCI Helicopters
(Ireland) Limited’s Motion to Dismiss, dated June 7, 2019 (“Objection”), pp. 17-18 (ECF
Doc. # 10).) Moreover, collateral estoppel should not apply because Macquarie did not
have a “full and fair opportunity to litigate” in that proceeding. (Id. pp. 19-20.)
Macquarie asserts that the Court should not consider the numerous facts outside the AC
raised by LCI in its Motion to Dismiss and Suppl. Motion to Dismiss. (Id. pp. 11-13.)
Macquarie also argues that its claims are adequately pleaded in the AC and are not
subject to a heightened pleading standard, that it has both direct and derivative
standing under the Macquarie Sale Order to assert a claim under section 363(n), and
that it should be entitled to proceed to discovery. (Id. pp. 2-3, 14-17, 35-36.)
DISCUSSION
A. 	Jurisdiction
The claims asserted by Macquarie, though based in part on the pre-petition NDA,
arise out of the sale of the WAC 9 Assets in this Court pursuant to the Bidding
Procedures Order and the Macquarie Sale Order. Accordingly, Macquarie’s claims
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arise in Waypoint’s chapter 11 cases or, in the case of Count III, under the Bankruptcy
Code, and this Court has subject matter jurisdiction under 28 U.S.C. §§ 157(a) and
1334(b) and the Amended Standing Order of Reference, No. M 10-468, 12 Misc. 00032
(S.D.N.Y. Jan. 31, 2012). Macquarie has consented to the entry of final orders and
judgments by this Court, (¶ 5), and contends that “LCI irrevocably and unconditionally
consented to submit to the exclusive jurisdiction of this Court for any lawsuits, actions,
or other proceedings arising out of or relating to the NDA.” (¶ 7 (citing NDA § 10).)
B. 	Standards Governing the Motion
In order to survive a motion to dismiss, “a complaint must contain sufficient
factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). While the Court must accept all well-pleaded factual allegations
as true, conclusory statements do not suffice. Id. “Determining whether a complaint
states a plausible claim for relief will . . . be a context-specific task that requires the
reviewing court to draw on its judicial experience and common sense.” Id. at 679.
“[W]here the well-pleaded facts do not permit the court to infer more than the mere
possibility of misconduct,” it fails to show that the pleader is entitled to relief. Id. (citing
Fed. R. Civ. P. 8(a)(2)).
In ruling on a motion to dismiss under Rule 12(b)(6), the Court may also consider
“documents attached to the complaint as exhibits, and documents incorporated by
reference in the complaint.” DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 111 (2d Cir.
2010). If a document is not incorporated into a complaint by reference, “the court may
nevertheless consider it where the complaint ‘relies heavily upon its terms and effect,’
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thereby rendering the document ‘integral’ to the complaint.” Id. (quoting Mangiafico v.
Blumenthal, 471 F.3d 391, 398 (2d Cir. 2006) (quoting Chambers v. Time Warner, Inc.,
282 F.3d 147, 152-53 (2d Cir. 2002))).
To consider such an integral document, there must be no dispute about “the
authenticity or accuracy of the document” or “the relevance of the document.” DiFolco
v. MSNBC Cable L.L.C., 622 F.3d at 111 (quoting Faulkner v. Beer, 463 F.3d 130, 134
(2d Cir. 2006)). The AC attaches the NDA and incorporates by reference and/or relies
upon numerous pleadings and orders from the Waypoint bankruptcy cases, including
the Bidding Procedures Motion, the Bidding Procedures Order, the Bidding
Procedures, the testimony at the February 12, 2019 hearing memorialized in the
transcript, and the Macquarie Sale Order. The Court may consider these documents in
connection with the Motion. In addition, the AC discusses at length Lombard’s
acquisition of the WAC 9 Assets but ignores the Lombard Sale Order. The authenticity
and relevance of the Lombard Sale Order is not open to question. It was executed by
the Court, filed on the docket and memorializes the Court’s findings that form the basis
of LCI’s collateral estoppel defense. Accordingly, I will also consider the Lombard Sale
Order.
C. 	Count I: Breach of the NDA
Macquarie brings Count I as assignee of the Debtors alleging a breach of the NDA
and stands in the Debtors’ shoes. The NDA is governed by New York law, (NDA § 10),
and under New York law, a claim for breach of contract must allege “(1) the existence of
an agreement, (2) adequate performance of the contract by the plaintiff, (3) breach of
contract by the defendant, and (4) damages.” Eternity Glob. Master Fund Ltd. v.
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Morgan Guar. Tr. Co. of N.Y., 375 F.3d 168, 177 (2d Cir. 2004) (quoting Harsco Corp.
v. Segui, 91 F.3d 337, 348 (2d Cir. 1996)). “Without a clear demonstration of damages,
there can be no claim for breach of contract.” Milan Music, Inc. v. Emmel Commc’ns
Booking, Inc., 829 N.Y.S.2d 485, 486 (N.Y. App. Div. 2007). A complaint that fails to
demonstrate how an alleged breach caused damage to the plaintiff is “fatally deficient.”
Gordon v. Dino De Laurentiis Corp., 529 N.Y.S.2d 777, 779 (N.Y. App. Div. 1988); see
also Int’l Bus. Machines Corp. v. Dale, No. 7:11-CV-951 (VB), 2011 WL 4012399, at *4
(S.D.N.Y. Sept. 9, 2011) (“The fatal aspect of defendant’s counterclaim is her inability to
show damages.”). Allegations of damages must consist of more than “boilerplate,” and
“the pleadings must set forth facts showing the damage upon which the action is based.”
Gordon v. Dino De Laurentiis Corp., 529 N.Y.S.2d at 779.
Macquarie asserts that LCI breached the NDA by contacting Lombard about the
purchase of the WAC 9 Assets following the consummation of Lombard’s successful
credit bid. (¶¶ 27-29.) Assuming this to be true, Macquarie has failed to allege how
those contacts damaged the Debtors. The AC speculates that the collusive bidding
arrangement between Lombard and LCI induced Lombard to make a credit bid it would
not have otherwise made and thus deprived “the Debtors of obtaining potential
competing cash bids for the WAC 9 assets and the additional value that such bids may
have realized.” (¶ 43.)
Assuming that LCI breached the NDA, the suggestion that the Debtors were
damaged defies common sense. The WAC 9 Debtors owed Lombard approximately
$98.4 million secured by the WAC 9 Assets. Secured creditors typically make credit bids
to protect their collateral from a sale at a depressed price. RadLAX Gateway Hotel, LLC
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v. Amalgamated Bank, 566 U.S. 639, 644 n.2 (2012). In this case, Lombard credit bid
the full amount of the debt. To suggest that it would not have made a credit bid but for
LCI’s prompting to prevent a sale at a depressed price belies the Supreme Court’s
observation in RadLAX and ignores the entire purpose of the right to credit bid codified
in 11 U.S.C. § 363(k).
The AC does not allege that Macquarie’s cash bid for the WAC 9 Assets was
higher, a critical piece of information in determining if the Debtor was damaged, or that
Macquarie intended to pay anything more which, in any event, seemed unlikely. Ms.
McDermott testified that Macquarie could have purchased Lombard’s claim for par plus
interest, i.e., the amount of Lombard’s credit bid. Had it done so, it could have made its
own credit bid. Curious about Macquarie’s bid, the Court asked Macquarie’s counsel at
oral argument what portion of its $650 million bid it had allocated to the purchase of
the WAC 9 Assets. Counsel did not know but eventually informed me that Macquarie
had allocated 13.2%, or $85.8 million. (ECF Doc. # 13.) In other words, Lombard
outbid Macquarie by roughly $13 million to prevent a sale to Macquarie at a depressed
price, precisely what Bankruptcy Code § 363(k) is designed to do.
It is equally implausible that a third party would have stepped in and made an
offer higher and better than Lombard’s credit bid. First, the deadline for third-party
bids had expired before Lombard made its credit bid and the Debtors had not received
any third-party bids. Second, even if a third party could still bid, its bid would have had
to exceed Lombard’s credit bid by at least $22.5 million. A third party purchase of the
WAC 9 Assets would have triggered the Debtors’ obligation to pay Macquarie a $19.5
million break-up fee plus as much as $3 million as an expense reimbursement. Thus, a
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third party would have had to bid at least $121 million for the WAC 9 Assets in order for
its bid to be higher and better than Lombard’s credit bid. The suggestion that there
were “potential competing cash bids for the WAC 9 assets” in an amount necessary to
benefit the Debtors’ estates, especially when a third party could have presumably
purchased Lombard’s secured claim for $98.4 million, exceeds the bounds of wishful
thinking.
Accordingly, Count I is dismissed with prejudice.
D. 	Count II: Tortious Interference with Business Relations
Macquarie, suing in its own right, alleges in Count II that LCI tortiously
interfered with its business relations with the Debtors under the Macquarie APA and the
various documents governing the bidding. In essence, the collusion between Lombard
and LCI prevented Macquarie from acquiring the WAC 9 Assets or, in the event of a
successful third-party bid, the $19.5 million break-fee plus the expense reimbursement
that the Debtors would have owed.
To state a claim for tortious interference with business relations under New York
law, 8 “four conditions must be met: (1) the plaintiff had business relations with a third
party; (2) the defendant interfered with those business relations; (3) the defendant acted
for a wrongful purpose or used dishonest, unfair, or improper means; and (4) the
defendant’s acts injured the relationship.” Catskill Dev., L.L.C. v. Park Place Entm’t
8 	Both parties cite to New York law on the claim alleging tortious interference with business
relations. (Objection pp. 28-34; Motion to Dismiss pp. 22-25.) Therefore, the Court “is not required to
conduct a choice of law analysis sua sponte, and instead may apply the state law assumed by the parties in
their papers.” Henneberry v. Sumitomo Corp. of Am., 415 F. Supp. 2d 423, 440, n.7 (S.D.N.Y. 2006)
(citing Lehman v. Dow Jones & Co., 783 F.2d 285, 294 (2d Cir. 1986) (Friendly, J.)).
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Corp., 547 F.3d 115, 132 (2d Cir. 2008). Where the plaintiff and defendant are
competitors, the plaintiff faces a high bar. “The existence of competition may often be
relevant, since it provides an obvious motive for defendant’s interference other than a
desire to injure the plaintiff; competition, by definition, interferes with someone else’s
economic relations.” Carvel Corp. v. Noonan, 818 N.E.2d 1100, 1104 (N.Y. 2004). If
the defendant is a competitor, but “there has been no breach of an existing contract, but
only interference with prospective contract rights,” the plaintiff must show that the
defendant’s conduct was not “lawful,” in other words, that it amounted to “a crime or an
independent tort.” Id. at 1103. Such “‘[w]rongful means’ include physical violence,
fraud or misrepresentation, civil suits and criminal prosecutions, and some degrees of
economic pressure; they do not, however, include persuasion alone although it is
knowingly directed at interference with the contract.” Id. at 1104 (citation omitted).
“When a defendant has acted with a permissible purpose, such as ‘normal economic
self-interest,’ wrongful means have not been shown, even if the defendant was
‘indifferent to the [plaintiff’s] fate.’” 16 Casa Duse, LLC. v. Merkin, 791 F.3d 247, 262
(2d Cir. 2015) (quoting Carvel, 818 N.E.2d at 1103). Thus, a competitor that interferes
with the plaintiff’s prospective business relations through persuasion to advance its own
economic interests does not use the wrongful means necessary to sustain the claim.
NBT Bancorp Inc. v. Fleet/Norstar Fin. Grp., Inc., 664 N.E.2d 492, 497 (N.Y. 1996);
Guard-Life Corp. v. S. Parker Hardware Mfg. Corp., 406 N.E.2d 445, 449 (N.Y. 1980);
Krinos Foods, Inc. v. Vintage Food Corp., 818 N.Y.S.2d 67, 68 (N.Y. App. Div. 2006).
Macquarie expected to earn a break-up fee and an expense reimbursement if a
third party outbid it. It contends that the collusive bidding arrangement did just that.
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According to the AC, LCI “acted with malice by dishonestly, unfairly, and improperly
breaching its obligations under the NDA” and “by dishonestly, unfairly, and improperly
circumventing the Court-ordered bidding procedures,” (¶ 48), and that “LCI’s conduct
targeted Macquarie, its relationship with Debtor, and its anticipated purchase of the
WAC9 assets.” (¶ 49.) These alleged breaches prevented Macquarie from “fully and
fairly participating in the WAC9 asset sale process, deprived Plaintiff of the benefit of
completing the acquisition of said assets under the Macquarie APA, and prevented
Plaintiff from receiving the court-ordered breakup fee to which it otherwise was
entitled.” (¶ 51.) Macquarie further asserts that LCI’s conduct was “fraudulent, wanton,
malicious, or willful in complete disregard of Plaintiff’s rights.” (¶ 53.)
When the AC is stripped of its conclusory allegations, the insufficiency of Count II
is laid bare. Macquarie acknowledges that LCI is engaged in the business of leasing
aircraft, (¶ 9), and hence, was Macquarie’s competitor. If LCI induced Lombard to sell it
the WAC 9 Assets for its own economic benefit it did not use wrongful means.
Macquarie does not allege that LCI engaged in “physical violence, fraud or
misrepresentation, civil suits [or] criminal prosecutions.” Carvel Corp. v. Noonan, 818
N.E.2d at 1104. Accordingly, Count II is legally insufficient and is dismissed with
prejudice.
E. 	Count III: Violation of Bankruptcy Code § 363(n)
Section 363(n) grants a trustee or debtor in possession the power, inter alia, to
recover the difference between the sale price and the market value where “the sale price
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was controlled by an agreement among potential bidders.” 11 U.S.C. § 363(n). 9 The
term “control” means more than causing “an incidental or unintended impact on the
price; it implies an intention or objective to influence the price.” Lone Star Indus., Inc.
v. Compania Naviera Perez Companc, S.A.C.F.I.M.F.A. (In re New York Trap Rock
Corp.), 42 F.3d 747, 752 (2d Cir. 1994). In other words, “[t]he influence on the sale
price must be an intended objective of the agreement, and not merely an unintended
consequence, for the agreement among potential bidders to come within the prohibition
of § 363(n).” Id. Generally, such prohibited collusive agreements are secret agreements
that have not been disclosed to the court. Kabro Assoc. of West Islip, LLP v. Colony Hill
Assoc. (In re Colony Hill Assocs.), 111 F.3d 269, 277 (2d Cir. 1997) (citing In re Sasson
Jeans, Inc., 90 B.R. 608, 610 (S.D.N.Y. 1988) (court was “hard pressed” to find bad faith
when challenged relationship between bidder and debtor “was fully disclosed to the
Bankruptcy Court”)).
While section 363(n) only grants the right to bring a claim to a trustee or debtor
in possession, an unsuccessful bidder may have standing to challenge the actions of a
successful bidder that “destroyed the ‘intrinsic fairness’ of the sale transaction so that it
was not a good faith purchaser.” Id. at 274. To challenge the intrinsic fairness of a sale,
the disappointed bidder must allege “that the sale was tainted by fraud, bad faith,
9 	The complete text of 11 U.S.C. § 363(n) is as follows:
The trustee may avoid a sale under this section if the sale price was controlled by
an agreement among potential bidders at such sale, or may recover from a party to such
agreement any amount by which the value of the property sold exceeds the price at which
such sale was consummated, and may recover any costs, attorneys’ fees, or expenses
incurred in avoiding such sale or recovering such amount. In addition to any recovery
under the preceding sentence, the court may grant judgment for punitive damages in
favor of the estate and against any such party that entered into such an agreement in
willful disregard of this subsection.
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collusion, deceit, mistake or unfairness.” Wallach v. Kirschenbaum, No. 11 CV 0795
(SJF), 2011 WL 2470609, at *4 (E.D.N.Y. June 16, 2011) (citing Licensing by Paolo, Inc.
v. Sinatra (In re Gucci), 126 F.3d 380, 388 (2d Cir. 1997) and In re Colony Hill Assocs.,
111 F.3d at 274).
Macquarie lacks standing to assert a claim under section 363(n) as assignee of
the Debtors. The Macquarie Sale Order, on which Macquarie relies, assigns the
Debtors’ rights to damages flowing from “violations of the Bidding Procedures and/or
the Bidding Procedures Order arising from intentional misconduct” to Macquarie
pursuant to the terms of the Macquarie APA. (Macquarie Sale Order ¶ 42.) The
Debtors did not assign any rights granted under the Bankruptcy Code, specifically,
rights under section 363(n). Even if Macquarie had standing, it has not alleged that the
Debtors were damaged by the alleged collusion for the reasons already stated. Put
simply, Lombard outbid Macquarie, the only other bidder.
Nor can Macquarie challenge the “intrinsic fairness” of the Lombard sale in its
own right based on the same allegations of collusion between LCI and Lombard. In
objecting to the proposed sale to Lombard, Macquarie argued that Lombard and LCI
had colluded. As a result, Lombard was not entitled to a finding that it acted in good
faith and Macquarie was entitled to a break-up fee and expense reimbursement.
Following an evidentiary hearing at which Macquarie availed itself of the opportunity to
cross-examine Ms. McDermott and Mr. Neimann, the Court found that “[a] fair and
reasonable opportunity to object to, and be heard with respect to, the Sale Motion and
the Sale Transaction has been given to all Persons entitled to notice pursuant to the
Bidding Procedures Order,” (Lombard Sale Order ¶ D), “the Debtors conducted a fair
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and open sale process[,] the sale process and the Bidding Procedures were non-
collusive, duly noticed, and provided a full, fair, and reasonable opportunity for any
entity to make an offer to purchase the [WAC 9 Assets],” (id. ¶ H), the agreements
governing the sale “were negotiated, proposed, and entered into by the Debtors and
[Lombard] in good faith, without collusion, and from arms’-length bargaining
positions,” Lombard “is a ‘good faith purchaser’ within the meaning of section 363(m) of
the Bankruptcy Code” and “complied with the provisions of the Bidding Procedures
Order, including compliance in all material respects with confidentiality agreements,”
the purchase price “was not controlled by any agreement among potential bidders,” and
“[n]either the Debtors nor [Lombard] have engaged in any conduct that would cause or
permit the Purchase Agreement to be avoided or costs and damages to be imposed
under section 363(n) of the Bankruptcy Code.” (Id. ¶ J.) All affected third parties,
including Macquarie, were bound. (Id. ¶ 35.) Macquarie did not appeal from the
Lombard Sale Order which is final.
Macquarie’s challenge to the “intrinsic fairness” of the sale is based on the same
allegations it pressed at the Lombard sale hearing, constitutes an impermissible
collateral attack on the Lombard Sale Order and is barred by the doctrine of collateral
estoppel. 10 Federal principles of collateral estoppel, which are applied “to establish the
10 	Macquarie argues that collateral estoppel is inapplicable because the Court left for another day
any claims based on intentional or willful misconduct. (Objection p. 17.) Macquarie mischaracterizes the
Court’s ruling which related to the release that the Debtors were proposing to give Lombard. Because
Macquarie was to receive an assignment of certain rights from the Debtors upon the consummation of its
own purchase, it was concerned about a potential release of those rights. The Debtors’ release of Lombard
excepted claims based on willful misconduct or intentional fraud. (See Lombard Sale Order ¶ 28.) The
claims left for another day referred to claims by Macquarie, as the Debtors’ assignee, against Lombard
based on intentional wrongdoing. As far as the Court is aware, Macquarie has not brought such claims
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preclusive effect of a prior federal judgment,” prohibit a party from relitigating an issue
where “‘(1) the identical issue was raised in a previous proceeding; (2) the issue was
actually litigated and decided in the previous proceeding; (3) the party had a full and fair
opportunity to litigate the issue; and (4) the resolution of the issue was necessary to
support a valid and final judgment on the merits.’” Ball v. A.O. Smith Corp., 451 F.3d
66, 69 (2d Cir. 2006) (quoting Purdy v. Zeldes, 337 F.3d 253, 258 & n. 5 (2d Cir. 2003)).
The issue of whether Lombard acted in good faith or colluded with LCI was raised
by Macquarie, litigated at length during the February 12 sale hearing and decided
against Macquarie. Macquarie objected to the sale of the WAC 9 Assets to Lombard
based, inter alia, on the breach of the Lombard NDA, contending that Macquarie was
entitled to a break-up fee because the Lombard credit bid was actually a joint venture
with LCI. It cross-examined Ms. McDermott at length on this point. As noted, the
Court found, among other things, that Lombard acted in “good faith” and “without
collusion,” the purchase price “was not controlled by any agreement among potential
bidders,” and Lombard had not “engaged in any conduct that would cause or permit the
Purchase Agreement to be avoided or costs and damages to be imposed under section
363(n) of the Bankruptcy Code.” (Lombard Sale Order ¶ J.) Macquarie never appealed.
If Lombard did not improperly collude with LCI, LCI did not improperly collude with
Lombard, and Count III constitutes an impermissible collateral attack on the Lombard
Sale Order.
and cannot show that anything Lombard did hurt the Debtors for the reasons stated. Furthermore, the
release in the Lombard Sale Order had nothing to do with LCI or Macquarie’s own claims.
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GAF Holdings, LLC v. Rinaldi (In re Farmland Indus., Inc.), 408 B.R. 497
(B.A.P. 8th Cir. 2009), aff’d on other grounds, 639 F.3d 402 (8th Cir. 2011), is directly
on point. There, the plaintiff (GAF) had been disqualified as a bidder at an earlier
bankruptcy auction. The bankruptcy court approved the sale to a third party, Coffeyville
Resources. The order approving the sale included findings that Coffeyville made the
highest and best offer, the sale procedures had been properly followed, GAF was not a
qualified bidder, the consideration was fair and reasonable and the transaction was
negotiated in good faith and without collusion. GAF did not object to or appeal the sale
order. Id. at 501.
GAF subsequently learned that Coffeyville had offered the debtor’s executive vice
president a lucrative position if it acquired the debtor’s assets and thereupon filed a
motion under Federal Civil Rule 60(b) and Federal Bankruptcy Rule 9024 to vacate the
sale order as a product of collusion. After discovery and a hearing, the bankruptcy court
denied the motion. The bankruptcy court’s findings reiterated in some detail that the
process was fair and open, untainted by any prospective employment of the debtor’s
executive vice president and GAF had the opportunity to speak to anyone it chose and
conduct due diligence. Id. at 501-02. GAF did not appeal the denial of its Rule 60(b)
motion, or the subsequent bankruptcy court order that authorized an amendment to the
sale order and reaffirmed its findings, including that the assets were purchased in good
faith and absent a stay pending appeal, would be entitled to the protection of 11 U.S.C. §
363(m). Id. at 502.
Three years later, GAF commenced an adversary proceeding alleging misconduct
on the part of various individuals and entities connected with the sale and seeking
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damages based on claims sounding in intentional interference with business expectancy
and conspiracy. Id. The defendants moved to dismiss on a variety of grounds, and the
bankruptcy court granted the motion concluding that the lawsuit was an impermissible
collateral attack on the sale order and failed to state a claim. Id.
The Bankruptcy Appellate Panel affirmed on several grounds, including collateral
estoppel. In order for the bankruptcy court to have entered a judgment for GAF, it
would have been necessary to review issues it had already decided and overrule its prior
findings. Id. at 506. GAF had the right to oppose the prior sale order, had
unsuccessfully litigated its grievances through its Rule 60(b) motion and never appealed
the sale order or the order denying the Rule 60(b) motion. Id. at 506-507. The issues
presented in GAF’s tortious interference action were the same as those that had already
been litigated and determined by the bankruptcy court in its prior orders. Id. at 506-07.
Accordingly, GAF’s actions were barred by collateral estoppel. Id. at 508.
Macquarie’s section 363(n) claim is barred for the same reasons. Macquarie’s
theory is that Lombard interposed a 100% credit bid based solely on its agreement with
LCI to sell the WAC 9 Assets after it consummated the sale from Waypoint. Thus, their
collusive agreement controlled the price of the auction of the WAC 9 Assets. To grant
relief to Macquarie under section 363(n), the Court would have to conclude, contrary to
its prior findings, that the sale was unfair, the purchase price was controlled by an
agreement between potential bidders and Lombard acted in bad faith. Accordingly,
Macquarie’s section 363(n) claim is precluded by collateral estoppel. Moreover, the
cases it cites in opposition to the applicability of collateral estoppel are distinguishable.
E.g., In re Gen. Motors LLC Ignition Switch Litig., No. 14-MD-2543 (JMF), 2016 WL
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4480093, at *2 (S.D.N.Y. Aug. 24, 2016) (refusing to give offensive collateral estoppel
effect to a bankruptcy court order that on its face stated it was to have “no force or
applicability in any other legal proceeding”); Elletson v. Riggle (In re Riggle), 389 B.R.
167, 175 (D. Colo. 2007), as amended (Aug. 15, 2007) (applying Colorado collateral
estoppel law to a state court judgment); Compagnie des Bauxites de Guinee v. L’Union
Atlantique S.A. d’Assurances, 723 F.2d 357, 361 (3d Cir. 1983) (concluding that
collateral estoppel did not apply where the issue had not been actually litigated, but was
determined against the party as a discovery sanction); Parklane Hosiery Co., Inc. v.
Shore, 439 U.S. 322, 331 & n. 15 (1979) (referring to circumstances where offensive
collateral estoppel may be unwarranted).
Finally, Macquarie argues that it did not have a “full and fair opportunity” to
litigate in that proceeding because it did not have time to conduct discovery or develop a
full record. (Objection pp. 19-20.) The argument lacks merit. At the time of the
Bidding Procedures Order in December 2018, Macquarie still believed that it would
acquire the WAC 9 Assets because Lombard was not in the business of leasing
helicopters and would not necessarily interpose a 100% credit bid. (¶¶ 21, 22.) On
January 23, 2019, however, three weeks before the sale hearing, the Debtors announced
that they had received a 100% credit bid from Lombard for the WAC 9 Assets. (Notice
and Identities of Successful Credit Bidders, dated Jan. 23, 2019, ¶ 7(b) (ECF Main Doc.
# 297); see ¶ 24.) Two weeks later, and one week before the sale hearing, Macquarie
filed the Macquarie WAC 9 Sale Objection. It asserted, inter alia, that its right to a
break-up fee was not affected if a lender and a third party had formed a joint venture to
purchase the assets, (Macquarie WAC 9 Sale Objection ¶¶ 2, 4 (first bullet point)), and
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had “raised these concerns to both representatives of the Debtors and to representatives
of the Buyer.” (Id. ¶ 4 (hanging paragraph).) Macquarie did not seek discovery or a
postponement of the hearing.
Macquarie received Ms. McDermott’s declaration a day before the hearing
confirming contact with a servicer and discussions about a possible future sale.
Macquarie did not ask for expedited discovery to take her deposition before the hearing
or a continuance prior to the hearing. Macquarie accepted her declaration as her direct
testimony and cross-examined Ms. McDermott at length about the contacts with LCI. It
was only after all sides rested and during closing arguments at which the Court
expressed some skepticism about the evidence supporting Macquarie’s objection that
Macquarie’s counsel suggested that some discovery and a delay might be in order. The
Court denied the request for the reasons already stated. Furthermore, sales in
bankruptcy often happen on an expedited basis, but expedition does not deprive a sale
order of its collateral estoppel effect. Official Committee of Unsecured Creditors v.
CIBC Wood Gundy Ventures, Inc. (In re Temtechco, Inc.), No. 95-00596, 1998 WL
887256, at *16 (Bankr. D. Del. Dec. 18, 1998) (ruling that collateral estoppel and res
judicata barred relitigation of issues that were tried and decided at an expedited sale
hearing that occurred three weeks after the chapter 11 petition date).
In this case, Macquarie was a party to the February 12 sale hearing and had a full
and fair opportunity to litigate its objections to the sale of the WAC 9 Assets to Lombard
based on its alleged collusion with LCI. The Court overruled those objections and found
that Lombard was a good faith purchaser that did not impermissibly collude with LCI.
Although aggrieved by the result — it lost its $19.5 million break-up fee and an expense
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reimbursement possibly worth $3 million — Macquarie never appealed from the
Lombard Sale Order which is final. Macquarie’s AC raises the same collusion issues
that were rejected by the Court and memorialized in the Lombard Sale Order, and as
such, Macquarie’s Count III claims asserted as assignee and in its own right are also
barred by collateral estoppel.
Accordingly, Count III is dismissed with prejudice.
The Court has considered Macquarie’s remaining arguments and concludes that
they lack merit. Settle order.
Dated: New York, New York
September 10, 2019
/s/ Stuart M. Bernstein
STUART M. BERNSTEIN
United States Bankruptcy Judge
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