United States District Court, S.D. New York
January 6, 2005.
BANCO CENTRAL DE PARAGUAY, on behalf and as assignee of Banco Union S.A.E.C.A. in liquidation and Banco Oriental S.A.I.F.E.C.A. in liquidation, Plaintiff,
PARAGUAY HUMANITARIAN FOUNDATION, INC. f/k/a CQZ HUMANITARIAN FOUNDATION, INC., CQZ HOLDING CORP., AVIJOS, INC., JOSE M. AVILA, RONALD L. WOLFSON and JORGE RALPH GALLO QUINTERO, Principal Defendants, and JOHN W. TULAC, Nominal Defendant.
The opinion of the court was delivered by: JOHN KEENAN, Senior District Judge
This dispute involves the diversion of $16 million from Banco
Union S.A.E.C.A. ("Banco Union") and Banco Oriental
S.A.I.F.E.C.A. ("Banco Oriental"), two Paraguayan banks in
liquidation. During March and April of 2000, the funds were
transferred to trust accounts maintained by Nominal Defendant
John W. Tulac, Esq. ("Tulac") at Citibank in New York.
Thereafter, $14 million of the $16 million was transferred to
Citibank accounts maintained by Principal Defendant Paraguay
Humanitarian Foundation ("PHF"), and over $1 million of the $16
million to other accounts maintained or controlled by Principal
Defendants Avijos, Inc. ("Avijos"), Jose M. Avila ("Avila"), CQZ
Holding Corp. ("CQZ Holding") and Nominal Defendant Tulac.
On November 1, 2001, Plaintiff Banco Central de Paraguay
("Banco Central"), claiming to be the assignee of the two
liquidated banks, commenced this action to recover the $16
million. Banco Central alleges conversion and constructive trust
claims against all defendants, and a conspiracy claim against the
principal defendants. On September 13, 2002, the principal
defendants filed their answer, affirmative defenses, counterclaim
and a now-discontinued third-party complaint against Citibank.
Tulac simultaneously filed his answer and interpleader
counterclaim. Upon leave of Magistrate Judge Maas, Banco Central
filed an amended complaint adding principal defendants Ronald L. Wolfson ("Wolfson") and Jorge Ralph Gallo Quintero ("Quintero")
on July 10, 2003. Principal Defendants have filed an answer to
the amended complaint and amended affirmative defenses.
Four motions are now before the Court. Banco Central moves for
summary judgment on Count One of its amended complaint, which
alleges conversion of the $16 million against all defendants. The
principal defendants move for summary judgment dismissing Banco
Central's claims and awarding costs and attorney's fees. Tulac
moves for judgment on the pleadings, or, alternatively, summary
judgment, for discharge under the interpleader and dismissal of
Banco Central's claims against him.
Banco Central is the highest banking authority in Paraguay and
has been characterized by one of its directors as "the Paraguyan
equivalent of the Federal Reserve Bank." (Weiner Affid., Exh. Q,
¶ 3). Under Paraguayan law, one of Banco Central's duties is to
supervise the liquidation of failed Paraguayan banks through the
Superintendent of Banks of Paraguay ("Superintendent"). (Id.).
The Superintendent appoints the liquidators and supervises the
liquidation while reporting back to Banco Central. (Id.). There
is some dispute among the parties concerning Banco Central's role
in this process. Banco Central claims that it supervises the
liquidation through the Superintendent. (Pl. Rule 56.1 Stmt. in
Support of Motion ¶¶ 1-2). Nominal defendant Tulac does not dispute the substance of this
statement. (Tulac Resp. to Pl. Rule 56.1 Stmt. ¶ 1). Principal
defendants, however, claim that Banco Central is not the Federal
Reserve equivalent and that the superintendent has the "full
authority" over the liquidated banks. (Def. Ans. To Pl. Rule 56.1
Stmt. ¶¶ 1-2).
In 1998, Banco Central placed Banco Union and Banco Oriental in
liquidation. In March 2000, the liquidators of the two banks,
presumably appointed by the Superintendent, appointed Juan
Fernando Rodriguez Leith ("Rodriguez Leith") power of attorney of
Banco Union and Ramon Alberto Guillen Ortiz ("Guillen Ortiz")
power of attorney of Banco Oriental. (Cubitt Affd., Exh. B & C).
The duration of these appointments was until the termination of a
so-called "Reserved Funds Investment Program," or until specified
dates in April 2001, whichever occurred first. (Weiner Affd.,
Exh. Z). At some point, presumably before March 2000, Rodriguez
Leith signed a pre-agreement to form a joint venture between the
"CQZ Project Manager" and the "D.F.M. Foundation" for work on a
"project management plan in Paraguay" and other South and Central
American countries. (Cubitt Affd., Exh. F). This pre-agreement
was signed by Rodriguez Leith, defendant Quintero (a director and
officer of defendant CQZ Holding Corp.), defendant Avila (a
director and officer of defendant Avijos), and Julio Gonzalez
Ugarte ("Gonzalez Ugarte"). Gonzalez Ugarte was a member of the Banco Central board of
On March 13, 2000, Rodriguez Leith, acting on behalf of both
banks, signed a letter of intent directed to Quintero referencing
the placement of the $16 million in a Paraguayan humanitarian
project. (Weiner Affd., Exh. G).*fn1 The next day, Rodriguez
Leith and Quintero apparently entered into a "Joint Venture"
referencing the $16 million placement. (Id. at Exh.
H).*fn2 This Joint Venture provides that "in the event that
the investment plan is not carried out, instruments deposited in
the form of cash and/or demand draft shall be reimbursed without
suffering damage or loss of value for any reason whatsoever."
(Id. ¶ 5).
Soon after the execution of the letter of intent and Joint
Venture, the transfers of funds at issue in this dispute
occurred. On March 17, 2000, $2 million was transferred from
Banco Union to a Citibank trust account in the name of "CQZ
Holding Project Trust." ("CQZ Trust Account"). On April 11, 2000, $6.1 million was transferred from Banco Union to another
Citibank trust account maintained by nominal defendant Tulac
("Trust Account"). The same day, $7.9 million was transferred
from Banco Oriental to the Trust Account. Later in the year, $14
million was transferred from the Trust Account to accounts
maintained by PHF at Citibank. Over $1 million was transferred
from the CQZ Trust Account to other accounts maintained or
controlled by Avijos, Avila (the president of Avijos and
secretary of PHF), CQZ Holding and Nominal Defendant Tulac. (Pl.
Rule 56.1 Stmt. in Support of Motion ¶ 3).
On June 28, 2000, Rodriguez Leith sent a "Donation Letter"
addressed to "CQZ Humanitarian Foundation" (the former name of
defendant PHF), which the letter defined as "a United States
charitable organization formed to fund humanitarian projects in
Paraguay and possibly other South American and Central American
nations." (Cubitt Affd., Exh. G). Rodriguez Leith extended a
"contribution" of $4 million and a "no-interest" loan of $10
million to the CQZ Humanitarian Foundation for feasibility
studies, a proposed hospital project and infrastructure
development in Paraguay. (Id.). On June 29, 2000, Rodriguez
Leith and the CQZ Humanitarian Foundation (PHF) executed the $10
million loan agreement. (Id.). It appears the transfer of $14
million of the $16 million from the Trust Account to the Citibank
accounts maintained by PHF occurred on the same day as the execution of the loan agreement. (Id., Amended
Cmplt. ¶ 22). On October 19, 2000, Rodriguez Leith wrote PHF and
informed the directors that the parties responsible for the $10
million loan wished to cancel the note and contribute the money
to PHF. (Cubitt Affd., Exh. I)
Also occurring in 2000 was the issuance of two checks by
defendant Avijos (Avila's company). (Weiner Affd., Exh. J-K). The
first, for $2 million, was dated March 13, 2000 and made payable
to Banco Union. This check was dated on the same day that
Quintero and Rodriguez Leith signed the letter of intent and four
days before the $2 million transfer from Banco Union. The second
check, for $14 million, was dated October 19, 2000 and made
payable to Rodriguez Leith. Avijos's account did not, and still
does not, have sufficient funds to cover these checks. (Weiner
Affd., Exh. L). Defendants claim that the giving of a check
(presumably even those that bounce as high as a Baltimore chop)
in South America and elsewhere signifies the giving of a
guaranty, even though "this is not the way we do things in the
U.S." (Def. Ans. to Pl. 56.1 Stmt. ¶ 4).
In January 2001, the Paraguayan press reported that $16 million
was missing from Banco Union and Banco Oriental. Soon thereafter,
the liquidators of the banks were replaced. Plaintiffs allege
that Avila, working in concert with Ugarte, then concocted phony
guarantees issued by ABN-AMRO Bank ("ABN") in favor of Banco Union and Banco Oriental. Defendants emphasize
that the phony ABN guarantees actually were provided by Banco
Central. (Def. Reply Mem. in Support at 3). In their depositions,
both Avila and Tulac testified that Ugarte appeared to be the
brains behind the guarantees. (Weiner Affd., Exh. A at 131-46;
Exh. D at 353-55). Avijos (Avila's company) sent contracts to the
new liquidators pursuant to which Avijos would purchase the
guarantees from Banco Union and Banco Oriental, thereby providing
an avenue for returning the $16 million. It appears that Avila,
on behalf of Avijos, entered into the contracts with the
liquidators on March 16, 2001. (Cubitt Affd., Exh. J, K).
Principal defendants submitted these contracts as part of their
opposition papers to Banco Central's summary judgment motions,
but failed to submit English translations of the documents.
On April 13, 2001, Tulac sent a letter to the new liquidators
in which he informed them that "[p]ursuant to a written agreement
between each bank and Avijos, Inc., the banks were guaranteed
repayment of a liquidated amount, including principal and all
accrued interest." (Weiner Affd., Exh. N). Tulac stated that he
was "instructed to settle these two contracts" and that once the
banks were paid in full, they would "no longer be a part of the
project development." (Id.). On April 27, 2001, Tulac wrote to
Citibank in Paraguay to ask for information necessary to send payments to Banco Union and Banco
Oriental "in settlement of their contracts with Avijos." (Id.,
Exh. P.). On May 1, 2001, the Banco Union liquidator acknowledged
receipt of an April 30, 2001 letter from Tulac that discussed
"the probable sending of the funds that were transferred to
[Tulac's] account at Citibank." (Id., Exh. O).*fn3 The
Banco Union liquidator requested an exact date for the transfer.
(Id.). The transfer was never made.
On September 10, 2001, in separate documents, Banco Union and
Banco Oriental assigned all their rights and claims in connection
with the diverted funds to Banco Central. (Weiner Affd., Exh. R).
Defendants claim that these assignments are invalid because they
were not notarized in accordance with Paraguayan law. (Def. Mem.
in Support at 6-7). On November 1, 2001, Banco Central commenced
this action. On November 15, 2001, the Court entered an order of
attachment of the nearly $14.1 million in the Citibank trust
accounts. These funds remain frozen pursuant to the Court's
In November 2001, new liquidators were appointed. In January
2004, these liquidators, on behalf of Banco Union and Banco
Oriental, executed ratifications of the assignments to Banco
Central and submitted declarations to the Court fully supporting the prosecution of this action by Banco Central.
(Swerdloff Affd., Exh. A-B).
I. Legal Standards
Banco Central and the principal defendants have submitted
motions for summary judgment. Tulac has submitted alternative
motions for judgment on the pleadings or summary judgment. The
latter motion includes a declaration by Tulac and two exhibits
not attached to, or incorporated in, the pleadings. In his reply
papers, Tulac refers to his declaration and to the exhibits in
support of contentions appearing in the Rule 12(c) motion
(Tulac's Reply Brief, dated Feb. 19, 2004, at 3-4). Because Tulac
has presented, and relied upon, material outside the pleadings,
the Court will treat his alternative motions as one motion for
summary judgment under Rule 56. See Sira v. Morton,
380 F.3d 57, 66 (2d Cir. 2004).
The Court may grant summary judgment only if the moving party
is entitled to judgment as a matter of law because there is no
genuine dispute as to any material fact. See Silver v. City
Univ. of New York, 947 F.2d 1021, 1022 (2d Cir. 1991); Montana
v. First Fed. Sav. & Loan Ass'n, 869 F.2d 100, 103 (2d Cir.
1989); Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 11 (2d Cir.
1986). The role of the Court on such a motion "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;
see also First Fed. Sav. & Loan Ass'n, 869 F.2d at 103
(stating that to resolve a summary judgment motion properly, a
court must conclude that there are no genuine issues of material
fact, and that all inferences must be drawn in favor of the
The movant bears the initial burden of informing the court of
the basis for its motion and identifying those portions of the
"pleadings, depositions, answers to interrogatories, and
admissions to file, together with affidavits, if any," that show
the absence of a genuine issue of material fact. Celotex Corp.
v. Catrett, 477 U.S. 317, 322 (1986). If the movant meets this
initial burden, the party opposing the motion must then
demonstrate that there exists a genuine dispute as to the
material facts. See id.; Silver, 947 F.2d at 1022.
The opposing party may not solely rely on its pleadings, on
conclusory factual allegations, or on conjecture as to the facts
that discovery might disclose. See Gray v. Town of Darien,
927 F.2d 69, 74 (2d Cir. 1991). Rather, the opposing party must
present specific evidence supporting its contention that there is
a genuine material issue of fact. See Celotex Corp.,
477 U.S. at 324; Twin Labs. Inc. v. Weider Health & Fitness,
900 F.2d 566, 568 (2d Cir. 1990). To show such a "genuine dispute," the opposing party must come forward with
enough evidence to allow a reasonable jury to return a verdict in
its favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586-87 (1986); Cinema North Corp. v. Plaza at
Latham Assocs., 867 F.2d 135, 138 (2d Cir. 1989). If "the party
opposing summary judgment propounds a reasonable conflicting
interpretation of a material disputed fact," then summary
judgment must be denied. Schering Corp. v. Home Insur. Co.,
712 F.2d 4, 9-10 (2d Cir. 1983).
II. Banco Central's Motion
Banco Central has moved for summary judgment on its conversion
claim, which is Count One of the Amended Complaint. In order to
state a cause of action for conversion, "a plaintiff must
establish legal ownership of a specific identifiable piece of
property and the defendant's exercise of dominion over or
interference with the property in defiance of the plaintiff's
rights." Di Siena v. Di Siena, 266 A.D.2d 673, 674,
698 N.Y.S.2d 93, 95 (3d Dep't 1999). "Wrongful intent is unnecessary.
All that the owner need show is that he has been deprived of his
property by the defendant's unauthorized exercise of dominion and
control over it." Filner v. Shapiro, 633 F.2d 139, 141-42 (2d
Cir. 1980). A limitation is that "[a] cause of action for
conversion cannot be predicated on a mere breach of contract." Fesseha v. TD Waterhouse Investor Services, Inc.,
305 A.D.2d 268, 269, 761 N.Y.S.2d 22, 24 (1st Dep't 2003).
Banco Central alleges that it has the superior right of
possession to the $16 million. Banco Central initiated this
lawsuit pursuant to assignments of rights from Banco Union and
Banco Oriental on September 10, 2001. The new liquidators
ratified these assignments in January 2004. Furthermore, Banco
Central contends, defendants have admitted that the liquidated
banks were entitled to the return of the money. For example,
Avila testified at his deposition:
Q: So they never got their money back because the
Paraguay Humanitarian Foundation wants to do this
project in Paraguay. Is that what you're telling me?
A: No. We are going to return the whole amount of
money with or without the project, in Paraguay.
(Weiner Affd., Exh. A at 129). Quintero also testified to the
same effect at his deposition:
Q: So am I correct in understanding that the
intention was that the money would be returned to the
two Paraguayan banks without the loss of any value?
. . .
Q: When you said you wanted him [Tulac] to make
settlement arrangements for making settlement with
the two banks, did you mean to return the
A: To set up so we could give them assistance so they
can get the $16,000,000 back plus interest.
(Id., Exh. C at 80, 102). Nominal defendant Tulac added another
variation on this theme with respect to the funds transferred to
a PHF trust account:
Q: So there would be no disbursements for the 14
A: There would be no disbursements from there. It was
ultimately contemplated the 14 million would be
Q: To Paraguay?
A: To Paraguay.
(Id., Exh. D at 167-68).
Banco Central also alleges that the defendants failed to return
the money upon demand, even though the money resided in trust
accounts under defendants' control. Consequently, Banco Central
argues, summary judgment on its conversion claim is warranted.
The principal defendants attempt to stave off summary judgment
with several arguments that attempt to generate a dispute of
fact. First the defendants attack the assignments, both here and
in their own motion for summary judgment, by challenging their
validity under Paraguayan law. (Pr. Def. Mem. in Support at 5;
Pr. Def. Rep. Mem. at 4; Pr. Def. Mem. in Opp. at 4). Defendants
cite a June 2002 e-mailed "Memorando" (in Spanish) from Alfredo
Kronawetter, who is purportedly an attorney in Paraguay. (Pr.
Def. Mem. in Support at Exh. E). This memorandum is accompanied
by an unsigned, undated, and uncertified English translation. First, the Memorando is hearsay
that would be inadmissible at trial. Second, even a ninth-grader
in the first month of Spanish 101 can see that the translation
bears no resemblance to any portion of the Memorando. The
translation discusses the notarization of certain documents. The
Memorando appears to discuss the jurisdiction of the Paraguayan
courts, and who has the ultimate authority to act on behalf of
banks in liquidation. The Court therefore disregards this
evidence and rejects principal defendants' argument that the
assignment were invalid.*fn4
Principal defendants also argue that "the liquidators of the
two banks, the power of attorney for the two banks, the president
and director and several other directors of [Banco Central] were
all involved from the beginning." (Pr. Def. Mem. in Opp. at 2).
While this statement is highly general, it is clear from the
submitted papers that Banco Union power of attorney Rodriguez
Leith, purportedly acting on behalf of both banks, was highly
involved in the transfers. Gonzalez Ugarte, a director on Banco
Central's board, also had some involvement, judging from his
execution of the Pre-Agreement. Even if the Court gives the non-movant defendants the benefit
of the doubt and assumes arguendo that their initial possession
of the $16,000,000 was proper, it is hornbook law that when the
dispossessed party makes a demand on his goods, an absolute and
unqualified refusal to surrender the goods constitutes
conversion. Prosser and Keeton on the Law of Torts 99 (5th ed.
1984); see, e.g., Schwartz v. Capital Liquidators, Inc.,
984 F.2d 53, 54 (2d Cir. 1993) ("Where the original possession is
lawful, a conversion does not occur until defendant refuses to
return the property after demand or until he sooner disposes of
the property."). Banco Central's action for conversion gives
notice of an adverse claim to the $16,000,000 and fulfills the
demand requirement. See Chemical Bank v. Soc'y Brand Indus.,
Inc., 624 F. Supp. 979, 983 (S.D.N.Y. 1985). Defendants' general
assertions concerning the involvement of Ugarte and the
liquidators do not change this analysis.
Principal Defendants next contend that Avijos has assumed
responsibility for the funds and owes Banco Central the
$16,000,000. Defendants contend that Avijos assumed this
responsibility by way of fraudulent checks for $2,000,000 and
$14,000,000. Defendants' (unsubstantiated) argument bears
repeating: "Although this is not the way we do things in the
U.S., it is common in South America and elsewhere in the world to give your check as your guarantee." (Pr. Def. Mem. in Opp. at 2).
This argument is far-fetched in the extreme.
In the next sentence of their brief, Principal defendants
contend that Rodriguez Leith, on behalf of the banks, "gifted"
the $16,000,000 to PHF. (Id. at 2-3). Principal defendants
refer to Rodriguez Leith's $4,000,000 contribution and
$10,000,000 loan that later became a contribution itself. (Cubitt
Affd. at Exh. G, I). This argument is also without merit. A gift
requires donative intent. Muserlian v. C.I.R., 932 F.2d 109,
113 (2d Cir. 1991). Defendants conceded repeatedly on deposition
that the banks were entitled to the return of the $16,000,000.
Furthermore, the Joint Venture between Rodriguez Leith (on behalf
of the banks) and Quintero (on behalf of CQZ Holding Trust) makes
clear that the money must be "reimbursed" to the banks if the
investment plan was not carried out. (Weiner Affd., Exh. H).
There was no "gift."
The Court has considered the Principal defendants' remaining
arguments and finds them unsubstantiated and therefore without
merit. In fact, Principal Defendants' papers contain very few
citations to the record. Far more often than not, Principal
defendants merely make conclusory "pound the table" statements
with no evidentiary support whatsoever. Plaintiffs' motion for
summary judgment on Count I of its Amended Complaint is therefore
granted with respect to the Principal Defendants. Nominal defendant Tulac, who held the trust accounts at
Citibank that housed the $16,000,000, fares better than his
co-defendants because Banco Central's motion papers in support of
summary judgment barely discuss his role. Banco Central merely
rebuts his arguments against conversion in their reply papers.
This is not enough for summary judgment with respect to him.
Tulac has produced the Trust Agreements that state that he "has
no knowledge of or participation in any investment program
arranged by [CQZ Holding Corp.]." His receipt of monies into the
trust account was pursuant to this agreement. While there is no
doubt that Tulac wrote letters in April 2001 purporting to
arrange for a reimbursement of funds that never took place, Banco
Central points to no clear evidence in its moving papers that
Tulac acted outside the scope of the trust agreements. The motion
for summary judgment on Count I of the Amended Complaint is
denied with respect to Tulac.
III. Principal Defendants' Motion
The principal defendants have moved for summary judgment on all
three counts on Banco Central's Amended Complaint. Obviously, the
motion on Count I is denied because the Court has already granted
summary judgment to Banco Central as against the principal
defendants on this Count. The motions on Counts II and III are
also denied. The principal defendants' motion is fatally flawed by its
noncompliance with Local Rule 56.1 of this District's Local Civil
Rules. According to Rule 56.1(a), "there shall be annexed to the
notice of motion a separate, short and concise statement, in
numbered paragraphs, of the material facts as to which the
moving party contends there is no genuine issue to be tried.
Failure to submit such a statement may constitute grounds for
denial of the motion." The principal defendants submitted no
statement at all until the reply papers stage a clear violation
of the Rule. The Court will overlook this failing because of its
broad discretion to excuse violations of the local rules. See
Wight v. Bankamerica Corp., 219 F.3d 79, 85 (2d Cir. 2000). On
the other hand, the submitted statement contains a flaw that the
Court cannot overlook.
Rule 56.1(d) provides that "[e]ach statement by the movant or
opponent pursuant to Rule 56.1(a) and (b) . . . must be followed
by citation to evidence which would be admissible, set forth as
required by Federal Rule of Civil Procedure 56(e)." As previously
discussed, Principal Defendant's papers are notable for their
lack of citations. Principal Defendant's Rule 56.1 statement
contains only three cited sentences in fifteen paragraphs and
the citations are to one declaration by defendant Avila. This
six-paragraph declaration states that Avila attended a meeting
with Ugarte, Rodriguez Leith, and Guillen Ortiz in 2000, that he gave the two checks "in accordance
with South American customs" and that Avijos has entered into a
contract with Banco Union and Banco Oriental stipulating that
jurisdiction over this matter was in Paraguay.
The jurisdiction issue appears in Principal Defendants' papers
from time to time, but it is a non-starter. This is a tort
action, not a contract action. While it is true that an action in
conversion will not lie for a mere breach of contract, the
plaintiff may bring a conversion claim when the breach "result[s]
in some `wrong' that is separately actionable." Wechsler v. Hunt
Health Systs., Ltd., 330 F. Supp. 2d 383, 431-432 (S.D.N.Y.
2004). Banco Central has chosen to sue in tort, and a contract
with Banco Union and Banco Oriental that provides for
jurisdiction in Paraguay does not govern Banco Central's
conversion claims. Principal Defendants indeed submitted these
contracts as exhibits to their opposition papers. Unfortunately,
the contracts are in Spanish, and Principal Defendants neglected
to provide translations.
The point of Local Rules such as Rule 56.1(d) is to compel the
movant to "specif[y] the material facts and direct? the district
judge and the opponent of summary judgment to the parts of the
record which the movant believes support his statement." Jackson
v. Finnegan, Henderson, Farabow, Garrett & Dunner, 101 F.3d 145,
150-51 (D.C. Cir. 1996). The Court's role is not to wander aimlessly through the record in search of
evidence that substantiates the allegations in the Rule 56.1
statement. When the movant is responsible for forcing the Court
into this role, the Court is completely justified in denying the
motion in its entirety. Principal defendants' motion is denied.
IV. Tulac's Motion for Summary Judgment
Tulac's Rule 56.1 statement, which is titled "Statement of
Undisputed Facts" while properly submitted with the initial
moving papers suffers from the same debilitating failing as the
principal defendant's statement. With the exception of the fourth
paragraph, none of the eight paragraphs in the statement contain
citations to the record. The only citations are to letters issued
by Citibank in May 2002 that terminated Tulac's accounts and
instructed him to conduct his banking business elsewhere. (Tulac
Notice of Motion, Exh. 1-2). Banco Central, by contrast, makes a
number (cited) assertions of fact in its Rule 56.1 Statement in
Opposition. These facts at least permit an inference that Tulac
had some role in the diversion. Tulac's motion for summary
judgment, which incorporates his motion for judgment on the
pleadings, is denied.
Banco Central's motion for summary judgment on Count I of its
Amended Complaint is granted as to the principal defendants and denied as to nominal defendant Tulac. The
remaining motions are denied.
Banco Central is directed to settle a judgment consistent with
this decision on seven days' notice to the principal defendants.
If the parties cannot agree on a judgment, they shall submit
proposed judgments to the Court no later than February 1, 2005.
The parties are directed to appear at a conference on March 8,
2005 at 9:45 a.m. in order to discuss any issues remaining in