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July 28, 1993

SAMEER Y. ZAHR, Plaintiff,


The opinion of the court was delivered by: DAVID N. EDELSTEIN

EDELSTEIN, District Judge:

 Plaintiff Sameer Y. Zahr ("Zahr") brings this action to enforce an alleged agreement between Zahr and defendants. Pursuant to this alleged agreement, plaintiff would receive approximately 44% of the outstanding shares of stock in Wingate Creek Acquisition Corp. ("Wingate") in exchange for his efforts on behalf of Wingate or as a result of the successful consummation of a joint venture agreement between plaintiff and Erol Y. Beker ("Beker"). Defendants move for summary judgment. For the reasons stated below, defendants' motion is granted.


 Zahr and Beker each own 44.275% of the stock of Royster, Inc. ("Royster"). Defendant Tectrade International Ltd. ("Tectrade") owns the remaining 11.45% of the stock in this entity. Royster Phosphates, Inc. ("RPI") operates a phosphate processing plant in Piney Point, Florida and is a wholly owned subsidiary of Royster. Also located in Piney Point, Florida, is the Wingate Creek Mine (the "Mine"), which produces phosphate rock of the type processed by RPI. Until mid-1990, the Mine was owned by Nu-Gulf Industries, Inc., a wholly-owned subsidiary of Gulf Atlantic Corporation ("Gulf Atlantic"). At this time, Gulf Atlantic was wholly owned by Windrose Partners, L.P. ("Windrose").

 In 1990, Zahr and Beker contemplated a series of transactions to acquire the Mine in order to procure a continuous supply of phosphate for the RPI plant. To this end, Zahr and Beker discussed the possibility of having Royster or RPI acquire the Mine (the "First Proposal"). Ultimately, however, these discussions did not produce an agreement. Next, Zahr and Beker explored the possibility of creating a new, jointly held corporate entity that would acquire the Mine (the "Second Proposal").

 Plaintiff and defendants dispute whether this proposed plan was consummated. In or around mid-November 1990, Beker formed Wingate. Wingate's stock was delivered to Beker and issued in his name. On November 30, 1990, Wingate acquired Gulf Atlantic from Windrose, and with it, the Mine, for $ 4.8 million: $ 3 million cash and a $ 1.8 million note delivered to the seller. Wingate obtained the $ 3 million cash necessary to acquire Gulf Atlantic from a line of credit maintained by Commodities Trading International Corporation ("CTI") with NMB Postbank Groep NV. At the time of the transaction, Zahr controlled CTI.

 Plaintiff claims that these actions were contemplated by the Second Proposal. Further, plaintiff asserts that he is the owner of 44.275% of Wingate based on his oral agreement with Beker to acquire equal ownership interests in the Mine. See Plaintiff's Rule 3(g) Statement, at 6. Accordingly, plaintiff asserts that 44.275% of the Wingate shares issued to Beker are being held by Beker as Zahr's nominee. See Id. at 4. Alternatively, plaintiff claims that the purchase of the Mine was the result of an oral joint venture agreement between himself and Beker. Plaintiff's Memorandum of Law in Opposition to Defendant's Motion for Summary Judgment ("Plaintiff's Memorandum"), at 15-17. Defendant denies the existence of any agreement with Zahr and avers that Wingate was not formed as a joint venture.


 "Summary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed 'to secure the just, speedy and inexpensive determination of every action.'" Celotex Corp. v. Catrett, 477 U.S. 317, 327, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986) (quoting Fed. R. Civ. P. 1). A party seeking summary judgment must demonstrate "that there is no genuine issue as to any material fact" such that it "is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c); see also Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 11 (2d Cir. 1986), cert. denied, 480 U.S. 932, 94 L. Ed. 2d 762, 107 S. Ct. 1570 (1987). "It is well settled that a court should grant a motion for summary judgment only if the evidence, viewed in the light most favorable to the party opposing the motion, presents no genuine issue of material fact." Cable Science Corp. v. Rochdale Village, Inc., 920 F.2d 147, 151 (2d Cir. 1990); see United States v. Diebold, Inc., 369 U.S. 654, 655, 8 L. Ed. 2d 176, 82 S. Ct. 993 (1962); Owens v. New York City Hous. Auth., 934 F.2d 405, 408 (2d Cir.), cert. denied, 112 S. Ct. 431 (1991).

 The moving party has the initial burden of establishing the absence of a genuine issue of material fact. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970). If the movant satisfies this prerequisite, the non-moving party may nonetheless defeat summary judgment by coming forward with specific facts that show there is a genuine issue for trial. Fed. R. Civ. P. 56(e); see also Matushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). Summary judgment will be denied if the evidence bolstering the non-moving party's case is sufficient to lead a rational trier of fact to return a verdict in his favor. National Union Fire Ins. Co. v. Walton Ins. Ltd., 696 F. Supp. 897, 900 (S.D.N.Y. 1988).

 In determining whether summary judgment is appropriate, "it has long been the rule that 'on summary judgment the inferences to be drawn from the underlying facts contained in [the moving party's] materials must be viewed in the light most favorable to the party opposing the motion.'" Lendino v. Trans Union Credit Info. Co., 970 F.2d 1110, 1112 (2d Cir. 1992) (quoting Adickes, 398 U.S. at 158-59). "In considering the motion, the court's responsibility is not to resolve disputed issues of fact but to assess whether there are any factual issues to be tried, while resolving ambiguities and drawing reasonable inferences against the moving party." Knight, 804 F.2d at 11 (citations omitted). The non-movant, however, "is not entitled to the benefit of unreasonable inferences, or inferences at war with undisputed facts." County of Suffolk v. Long Island Lighting Co., 907 F.2d 1295, 1318 (2d Cir. 1990) (quoting Lewis v. Nelson, 277 F.2d 207 (8th Cir. 1960)). Rather, once the movent has met his initial burden, "to defeat a motion for summary judgment a plaintiff must offer 'concrete evidence from which a reasonable juror could return a verdict in his favor.'" Cinema North Corp. v. Plaza at Latham Assoc., 867 F.2d 135, 138 (2d Cir. 1989) (quoting Dister v. Continental Group, Inc., 859 F.2d 1108 (2d Cir. 1988)); see Grant Thornton v. Syracuse Sav. Bank, 961 F.2d 1042, 1046 (2d Cir. 1992).

 In his complaint, plaintiff asserts five claims for relief. Each claim for relief rests upon the premise that Beker is holding Wingate stock as Zahr's nominee and that Zahr is, in fact, the equitable owner of 44.275% of Wingate's outstanding stock. If Zahr is not the equitable owner of the Wingate stock, Beker could not be holding the stock as Zahr's nominee and, therefore, there would be no material issue of fact to be resolved at trial and defendants would be entitled to summary judgment. Thus, the linchpin of the instant motion is whether, as a matter of law, Zahr may be the owner of Wingate stock.

 Based on the aforementioned facts, Zahr could have acquired Wingate stock in two ways: through a pre-incorporation subscription agreement or through a post-incorporation agreement for the sale or transfer of securities through which Beker would be required to transfer to Zahr a portion of the Wingate stock held by Beker. Under either scenario, the pertinent agreement must be in writing in order to be enforceable. New York Business Corporation Law requires that, in order to be enforceable, a subscription agreement be in writing. See New York Business Corporation Law ("B.C.L.") § 503(b). *fn1" In addition, pursuant to section 8-319(a) of the Uniform Commercial Code ("U.C.C."), as adopted by New York, any agreement between Beker and Zahr to transfer to Zahr Wingate stock held by Beker would be invalid absent a written instrument evidencing such an agreement. See N.Y. Stat. Art. 8, § 8-319(a) (McKinney 1992). Under U.C.C. § 8-319(a) a written agreement for ...

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