United States District Court, S.D. New York
OPINION AND ORDER
KATHERINE POLK FAILLA United States District Judge
parties to this interpleader all claim ownership over certain
property purchased with funds that Ferdinand and Imelda
Marcos allegedly misappropriated during Mr. Marcos's
presidency of the Philippines (the “Interpleader
Property”). The property at issue includes
approximately $15 million in cash and seized funds from
several bank accounts; Claude Monet's
L'Église et La Seine à
Vétheuil and Alfred Sisley's Langland
Bay (and other paintings); and sundry personal items
(including jewelry, carpets, pens, boxes, and a jade and
wooden screen). The District Attorney for New York County
(“District Attorney” or “DANY”)
seized the contested assets during its criminal investigation
and prosecution of Vilma Bautista, a confidante and personal
secretary of Imelda Marcos. The DANY, an innocent stakeholder
with no claim of ownership to the Interpleader Property,
transferred the property to this Court so that the rightful
owner or owners could be determined. Among the claimants are:
the Republic of the Philippines (“Republic”); a
class of human rights victims led by Jose Duran, who are
judgment creditors against Imelda Marcos (“Class
Plaintiffs”); Vilma Bautista, who in addition to
serving as Imelda Marcos's personal aide during the
relevant time period also worked for the Philippine
government from 1966 until 1986, including as a Foreign
Service Officer for the Philippine Mission to the United
Nations; and the Golden Budha Corporation along with the
Estate of Roger Roxas (together, “Roxas”).
before the Court are seven motions, comprising five
cross-motions for summary judgment, one motion to dismiss,
and one motion for imposition of attorneys' retaining and
charging liens. The motions are:
• Class Plaintiffs' motion for partial summary
judgment against the Republic (Dkt. #193);
• Class Plaintiffs' motion for summary judgment
against Roxas (Dkt. #369);
• Bautista's motion for summary judgment against
Class Plaintiffs and the Republic (Dkt. #201);
• Bautista's motion for summary judgment against
Roxas (Dkt. #377);
• Roxas's motion for summary judgment against Class
Plaintiffs and Bautista (Dkt. #383);
• The Republic's motion to dismiss or, in the
alternative, to stay the case (Dkt. #411); and
• Simon & Partners LLP's
(“S&P's”) motion to authorize imposition
of attorneys' retaining and charging liens (Dkt. #357).
Court addresses each motion in turn. For the reasons set
forth below, the Court denies each motion except
S&P's motion to authorize imposition of
interpleader action is the latest in what is now a long
series of proceedings - spanning decades and pursued in
numerous jurisdictions - in which claimants have sought ownership
over assets that Ferdinand Marcos and Imelda Marcos allegedly
misappropriated during Mr. Marcos's tenure as President
of the Philippines. A full recitation of the history of the
disputes between Mr. and Mrs. Marcos, on one side, and the
claimants, on the other, would fill volumes. Rather than
engage in such an exhaustive factual recitation, the Court
instead focuses on the facts that pertain directly to the
Ferdinand Marcos's Presidency, and the Presidential
Commission on Good Government
Marcos served as President of the Philippines from 1965 until
1986. (Class Plaintiffs 56.1 ¶ 2). He was elected to two
terms in office, in 1965 and 1969. Rather than leaving office
at the end of his second term, as required under the
Philippine Constitution, Mr. Marcos instead imposed martial
law in September 1972. He “confiscated businesses[, ]
particularly those of his adversaries[, ] and ordered mass
arrest and detention which, in many instances, resulted in
the torture of political opponents, critics, independent
publishers[, ] and journalists[.]” (Swift Decl., Ex.
February 1986, a popular uprising removed Mr. Marcos from
office, and he and Mrs. Marcos fled to Hawaii. (Class
Plaintiffs 56.1 ¶ 3). On February 25, 1986, Corazon
Aquino was sworn in as the new President of the Philippines.
(Id. at ¶ 4). Shortly after her inauguration,
President Aquino enacted Executive Order No. 1, which,
inter alia, created the Presidential Commission on
Good Government (“PCGG”). (Id. at ¶
5). The PCGG was charged with recovering assets that Mr.
Marcos, Mrs. Marcos, and their family had misappropriated
during the Marcos presidency. To date, the PCGG has collected
over 8 million pages of documents relating to Mr. and Mrs.
Marcos's assets. (Id. at ¶ 22).
1986, the PCGG established an office in New York City to
track down assets that Mr. and Mrs. Marcos had acquired.
(Class Plaintiffs 56.1 ¶ 23). It identified artwork that
had been removed from properties in New York City, including
a townhouse at 13-15 East 66th Street, which was owned by the
Republic but had been used as a residence by Mr. and Mrs.
Marcos. (Id. at ¶¶ 7-8). Artwork had
similarly been removed from an apartment in the Olympic Tower
at 641 Fifth Avenue that Mr. and Mrs. Marcos had used as a
private residence. (Id. at ¶ 9).
PCGG inventoried the paintings that had been displayed at the
New York properties. (Class Plaintiffs 56.1 ¶ 24). Using
bills, invoices, and labels placed on the walls where the
paintings had been hung, the PCGG created a list of specific
works of art that had gone missing. (Id. at
¶¶ 25, 28). The PCGG then took several steps to try
to locate the missing artwork. It served subpoenas duces
tecum on art galleries and auction houses in New York
and elsewhere, including Marlborough Gallery. (Id.
at ¶ 26). It launched a campaign, called
“Where's the Art?”, aimed at increasing
public awareness of the PCGG's efforts to recover the
artwork and ratcheting up the pressure on Mr. and Mrs. Marcos
to return whatever artwork they possessed. On June 23, 1986,
the PCGG issued a press release in which it “ask[ed]
artists, school children, media specialists, the general
public and the press to cheerfully join the campaign by
writing to Mrs. Marcos on Where's the Art?
postcards[.]” (Swift Decl., Ex. 13). That press release
included a list of missing paintings; the list made specific
reference to Monet's L'Église et La Seine
à Vétheuil and Sisley's Langland
Bay, but made no mention of Monet's Le Bassin
aux Nymphéas. (Id.).
DANY seized most of the Interpleader Property from Bautista
and from bank accounts holding funds in Bautista's or her
sisters' names on July 18 and July 19, 2011. (Compl.
¶ 19). The seized property included: (i) 10 paintings, a
Serafian Isfahan rug, and $251, 142 in cash from
Bautista's Manhattan residence; (ii) 114 items of jewelry
and $2, 386 in cash from the residence of Bautista's
sisters; (iii) 42 paintings and a rug from Bautista's
Long Island residence; and (iv) approximately $13, 654,
349.32 from bank accounts in Bautista's name and $1, 270,
000 from an account jointly controlled by Bautista and one of
her sisters. (Id. at ¶¶ 19-20). The DANY
also froze six life insurance or annuity accounts in
Bautista's name. (Id. at ¶ 20). And on July
28, 2011, Hoffinger, Stern & Ross LLP, Bautista's
former attorneys, surrendered two additional paintings in
connection with the criminal action. (Id. at ¶
The 1975 Acquisition of Monet's L'Église
et La Seine à Vétheuil and Sisley's
August 12, 1975, Marlborough Gallery in London sold six
paintings on consignment - for a total of $450, 000, of which
$200, 000 was paid at the time of sale - to Fe Gimenez,
personal secretary and confidante of Imelda Marcos, on Mrs.
Marcos's behalf. (Swift Decl., Ex. 2). The paintings
included Monet's L'Église et La Seine
à Vétheuil, which sold for $138, 000, and
Sisley's Langland Bay, which sold for $82, 000.
The Sales Report lists Mrs. Gimenez's address as
“Study Room, Malacanang Palace, Manila,
Philippines.” (Swift Decl., Ex. 2). The delivery
instructions state: “All taken except Moore[, ] which
should be delivered to the Philippines['] London
Embassy.” (Id.). The Consignment Note, on
Marlborough Gallery's letterhead and dated November 26,
1975 (when the paintings were dispatched), is addressed to
“Madame Marcos, Malacanang Palace, Manila,
The 1977 Acquisition of Monet's Le Bassin aux
March 31, 1977, Mrs. Marcos purchased nine paintings from
Marlborough Gallery for a total of $2.9 million. (Swift
Decl., Ex. 3). The most expensive was Monet's Le
Bassin aux Nymphéas (the “Water Lily”
painting), which sold for $791, 800. (Id.). The
money used to purchase the paintings came from a Swiss bank
account held in the name of Trinidad Foundation, a foundation
created in 1970. (Id., Ex. 5; Republic Opp. Class
Plaintiffs 56.1 ¶ 17). Mrs. Marcos was the primary
beneficiary of the Trinidad Foundation. (Id.).
1986, after Mr. Marcos was removed from office, the Swiss
government froze several of the Trinidad Foundation's
bank accounts. It did so based on the Republic's claim
that all of the money in the accounts had been
misappropriated by Mr. and Mrs. Marcos, and that the Republic
was the rightful owner. (Class Plaintiffs 56.1 ¶ 31). In
August 1991, the Swiss government provided documentation of
transactions that had been processed through the Trinidad
Foundation's bank accounts, including specific references
to the March 29, 1977 payment of $2.9 million to the London
bank account of Marlborough Fine Arts. (Id. at
The Display and Subsequent Removal of the Paintings
the Marcos presidency, artwork purchased on behalf of Mrs.
Marcos was displayed at the townhouse at 13-15 East 66th
Street in New York City. (Class Plaintiffs 56.1 ¶¶
7-8). The Republic owned that property, which served as the
Philippine Consulate in New York, though it was also used by
Mr. and Mrs. Marcos as a private residence. (Id.).
Mrs. Marcos also displayed some of the artwork at a second
residence in New York, an apartment in the Olympic Tower.
(Id. at ¶ 9).
took possession of the paintings, though the timing of her
appropriation of the paintings is a point of speculation and
of some contention. Class Plaintiffs assert that, “[i]n
late 1985 or early 1986, the three paintings were removed and
hidden by Bautista[.]” (Class Plaintiffs 56.1 ¶
20). The Republic, by contrast, is unwilling to provide even
a general timeframe for Bautista's appropriation of the
paintings. It states merely that “[t]he time period
when the[ ] [paintings] were taken is yet unclear.”
(Republic Opp. Class Plaintiffs 56.1 ¶ 20). What is
undisputed is that, when officials from the PCGG searched for
the paintings after Mr. Marcos was swept from power in 1986,
it did not find them in either the townhouse or the Olympic
Bautista's Sale of the Water Lily Painting, and Her
Sale of the Water Lily Painting
September 14, 2010, Bautista sold the Water Lily painting to
a London gallery for $32 million. (Class Plaintiffs 56.1
¶ 34). In connection with that sale, Bautista provided
the purchaser with a Certificate of Authority, signed by Mrs.
Marcos and dated June 21, 1991, stating that Bautista was
“[Mrs. Marcos's] authorized representative to offer
and negotiate, on [Mrs. Marcos's] behalf, the sale and/or
disposition of [Monet's Water Lily painting.]”
(Swift Decl., Ex. 11). It further indicated that Bautista was
“authorized to sign, on [Mrs. Marcos's] behalf, the
corresponding deeds of transfer of ownership of [the]
painting[ ]” and “to receive and/or sign receipts
for the proceeds of the sale of [the] painting[ ].”
letter issued to the purchaser of the Water Lily painting,
Bautista explained that, during one of Mrs. Marcos's
visits to New York in 1991, “a number of original
copies of a pro forma Certificate of Authority [were]
prepared and notarized … and each one was signed by
Mrs. Marcos.” (Swift Decl., Ex. 12). For each,
“the central section where the description of the asset
to be sold … was left blank for later
completion.” (Id.). In February 2010, Bautista
“used one of the signed and notarized Certificates of
Authority and typed in the appropriate section therein the
description for the painting now being sold.”
(Id.). She went on to note that “Mrs. Marcos
believes that all her correspondence as well as other
communications are always subject to constant monitoring and
surveillance by the government (both Philippine and U.S.),
” and thus that “confidentiality should always be
preserved and maintained for all sensitive matters such as
the sale of the [p]ainting in question.”
further stated that she had “received instructions from
[Mrs. Marcos] to sell the [p]ainting, and [Mrs. Marcos] [wa]s
aware of the sale.” (Swift Decl., Ex. 12). She was
“acting as [Mrs. Marcos's] agent with authority to
sell the [p]ainting of which [Bautista] ha[d] physical
possession[.]” (Id.). The painting
“ha[d] been in [Bautista's] possession for a good
number of years and ha[d] been kept in different locations in
New York.” (Id.). Bautista did not “have
any documentary record of when the [p]ainting was purchased
by Mrs. Marcos, but to the best of [Bautista's]
recollection … it was bought together with other
paintings in London during the late 70s or early 80s.”
(Id.). Bautista closed by stating: “In
entering into the Agreement and at the Closing, I shall
continue to act as [Mrs. Marcos's] authorized agent and
Bautista's Criminal Prosecution
2011, the DANY launched an investigation into the sale of the
Water Lily painting, which investigation culminated in
Bautista's indictment on October 8, 2012. (Bautista 56.1
¶ 22). Bautista was “charged with having illegally
conspired to possess and sell valuable works of art acquired
by Marcos during her husband's presidency, keep the
proceeds for herself, and hide those proceeds from New York
State tax authorities and others.” (Compl. ¶ 16).
She and her co-conspirators “attempted to sell the
paintings covertly using a variety of illicit means.”
(Id. at ¶ 17). After selling the Water Lily
painting, Bautista received $32 million dollars, “paid
her accomplices ‘commissions, ' and kept the rest
of the money herself.” (Id.). And in April
2011, Bautista filed a 2010 tax return that did not mention
the sale or any income derived therefrom. (Id.).
November 18, 2013, after a five-week trial, Bautista was
found guilty on all counts, including Conspiracy in the
Fourth Degree, Criminal Tax Fraud in the First Degree, and
Offering a False Instrument for Filing in the First Degree.
(Compl. ¶ 18). The criminal action determined that
“Bautista was not the rightful owner of the
[paintings], including the Water[ ] Lily painting[.]”
(Id. at ¶ 22). On October 20, 2015, the
Appellate Division reversed the conspiracy conviction (but
affirmed the remaining convictions) after finding, inter
alia, that “[t]he trial court erred in reading or
paraphrasing approximately eight sentences from an order of
the Supreme Court of the Philippines … [where] [o]nly
one sentence read by the court to the jury purported to state
the law of the Philippines[.]” People v.
Bautista, 18 N.Y.S.3d 47, 49 (1st Dep't 2015). The
DANY elected not to retry Bautista on the conspiracy
Prior Judgments That Claimants Seek to Enforce in This
Roxas's Hawaii Judgment
brought suit against Mr. and Mrs. Marcos in Hawaii state
court on February 19, 1988, alleging then - as
does now - that, in January 1971, he discovered a “lost
treasure” that was reputed to have been left by General
Tomoyuki Yamashita (the “Yamashita Treasure”) in
underground tunnels in Baguio City in the Philippines. (Roxas
56.1 ¶¶ 2-3, 32-33). The treasure included a Buddha
statue made of one metric ton of gold, handfuls of uncut
diamonds, and boxes filled with gold bars. (Id. at
¶¶ 4-7). Roxas further alleged that, in May 1971
and again in July 1972, he was taken into custody and
tortured at President Marcos's direction. (Id.
at ¶¶ 11-13). Roxas claimed that, in late 1974,
government soldiers seized the Yamashita Treasure and that
Marcos subsequently sold much, if not all, of the gold.
(Id. at ¶¶ 16-30).
Hawaii lawsuit sought compensation for Roxas's torture
and false imprisonment, as well as for the treasure that [Mr.
Marcos] had allegedly converted. (Roxas 56.1 ¶ 33). Mr.
Marcos died on September 28, 1989, and Mrs. Marcos stipulated
that she would serve as the decedent's representative.
(Id. at ¶¶ 36-37). The case went to trial
in the summer of 1996. On July 19, 1996, the jury issued a
verdict: It found Mr. Marcos liable and awarded Roxas $6
million in damages for battery and false imprisonment; $1.3
million for the golden Buddha statue; $100, 000 for seventeen
gold bars and $5, 000 for a coin collection taken from
Roxas's house; and $22 billion for the gold bullion that
Mr. Marcos had converted from an underground storage area,
which constituted the bulk of the Yamashita Treasure.
(Id. at ¶¶ 45-50). The verdict was issued
against Mr. Marcos and subsequently amended by the
intermediate appellate court to reflect that it was a
judgment against Mr. Marcos's estate (the “Marcos
Estate” or the “Estate”) and against Imelda
Marcos as the Estate's personal representative.
(Id. at ¶ 58).
Marcos appealed. (Roxas 56.1 ¶ 51). The Hawaii Supreme
Court addressed two issues relevant to the instant action.
Preliminarily, it assessed whether the lower court had erred
in appointing Mrs. Marcos as representative of the Marcos
Estate. It held that, even though “an heir of an
undistributed estate … is not a ‘proper
party' for substitution, ” Mrs. Marcos was
“judicially estopped from attempting to renounce her
prior disingenuous position regarding her legal
status[.]” Roxas v. Marcos, 969 P.2d 1209,
1240 (Haw. 1998). For this reason, the court rejected Mrs.
Marcos's argument that the judgment should not have been
entered against her as representative of the Estate. As the
court noted, “in order to achieve manifest justice
consistent with the doctrine of judicial estoppel, the
equities of this case require us to hold Imelda personally
liable, at least to the extent of her interest in the assets
of the Marcos Estate[.]” Id. at 1244.
court next addressed whether Roxas had produced sufficient
evidence to support the verdict. It began by noting that
“Ferdinand's witnessed possession of large amounts
of gold, combined with the testimony of [co-conspirators]
that at least some of the gold was resmelted and
surreptitiously sold, constitute[d] sufficient corroboration
of the testimony that Ferdinand was attempting to launder and
fraudulently convey Roxas's gold.” Roxas,
969 P.2d at 1256. The court further found that there was
sufficient evidence to support the jury's finding that
Mr. Marcos had converted some of the Yamashita Treasure and
had battered and falsely imprisoned Roxas. Id. at
1256-60. It therefore upheld the damage award as to the
battery and false imprisonment claims, as well as the damages
flowing from the theft of the golden Buddha statue and the
seventeen gold bars and coin collection taken from
Roxas's home. Id. at 1266-75.
the court reversed the portion of the verdict awarding Roxas
$22 billion for “one storage area” of gold
bullion. Roxas, 969 P.2d at 1275. The court found
that the testimony regarding the quantity of gold in the
storage area was “extremely vague.” Id.
at 1260 (“For example, Jonsson testified that the room
he had seen was ‘[m]aybe 40 feet by 20,
something like that' … and that he
‘believed' that the ceiling was twelve feet tall,
‘[m]aybe more. I don't
remember.'” (emphases in original)). Because
the testimony was so imprecise, it “afforded the jury
no legitimate basis for determining damages.”
Id. The vacillations in the testimony concerning
volume admitted a “margin of error comprising thousands
of tons.” Id. Accordingly, the court
overturned the $22 billion award for the gold bullion. Roxas
was left with a judgment of $6 million in damages for battery
and false imprisonment, and $1, 405, 000 for the theft of the
golden Buddha statue and the seventeen gold bars and coin
collection taken from Roxas's house (the “Roxas
Class Plaintiffs' Hawaii Judgment
was not the only victim of the Marcos regime that brought
suit following Mr. Marcos's removal from power. Shortly
after Mr. Marcos fled to Hawaii, human rights victims and
their families brought actions against Mr. Marcos seeking
damages for torture, summary execution, and disappearance.
See Hilao v. Estate of Marcos, 103 F.3d 762, 763
(9th Cir. 1996). In 1991, these actions were consolidated and
certified as a class action in the U.S. District Court for
the District of Hawaii comprising approximately 10, 000
individuals. Id. The court entered a preliminary
injunction prohibiting the Marcos Estate and its agents from
disposing of any of the Estate assets. Id. The class
obtained a verdict of liability against Marcos's Estate
and an award of nearly $2 billion in damages, which made the
preliminary injunction permanent. Id.
2011, the Class obtained a second judgment - which they seek
to enforce in the instant action - in the amount of $353,
600, 000. See In re Estate of Marcos Human Rights
Litig., 496 F. App'x 759, 760 (9th Cir. 2012)
(memorandum opinion). That judgment was entered after the
court granted Class Plaintiffs' motion for entry of final
judgment for civil contempt, stemming from violations of a
February 19, 1995 Order enjoining the Marcos heirs from
transferring or otherwise disposing of Estate assets. See
id.; see also Hilao, 103 F.3d at 763-64. Both
the 1995 and 2011 judgments have been transferred to and
registered in the Southern District of New York.
February 11, 2014, the DANY filed an interpleader complaint.
(Dkt. #2). In that complaint, the DANY identified various
parties that had already asserted or were expected to assert
claims to the Interpleader Property, including: the Republic,
Class Plaintiffs, Bautista and her sisters, Imelda Marcos,
and an unnamed artist and museum in the Philippines. Of those
parties, only the Republic, Class Plaintiffs, and Bautista
remain in this action. On July 11, 2016, Roxas filed a motion
to intervene (Dkt. #237), which the Court granted on August
12, 2016 (Dkt. #262).
April 22, 2015, Class Plaintiffs filed a Rule 12(b)(6) motion
to dismiss the Republic's cross-claims and affirmative
defenses. (Dkt. #76-79). The Court held oral argument on
November 24, 2015, and again on December 28, 2015.
(See Dkt. #131, 134). The Court denied the motion on
January 20, 2016. (Dkt. #137). In doing so, the Court noted
that, “[p]erhaps the most perplexing issue presented by
the [m]otion arises from the choice-of-law analysis
implicated by the parties' arguments.” Dist.
Atty. of N.Y. Cty. v. Rep. of the Philippines
(hereinafter, “Philippines I”), No. 14
Civ. 890 (KPF), 2016 WL 9022580, at *3 (S.D.N.Y. Jan. 20,
2016). The Court observed that “neither party has
proffered expert testimony to aid the Court in identifying,
interpreting, or contextualizing the foreign law or laws that
apply.” Id. at *4. The Court further noted
that it “cannot resolve the ownership arguments raised
… because the parties have not provided a sufficient
basis for selecting the law that determines the ownership of
the property at issue.” Id. Nor could the
Court conclude as a matter of law that “the
Republic's claims [we]re barred by the applicable
statutes of limitations in the face of the Republic's
fact-intensive invocation of equitable estoppel.”
Id. at *5.
pending before the Court are the following seven motions:
• Class Plaintiffs' motion for partial summary
judgment against the Republic: Class Plaintiffs filed their
opening papers on June 1, 2016 (Dkt. #193-196), the Republic
filed its opposition brief on July 1, 2016 (Dkt. #225), and
Class Plaintiffs filed their reply on July 18, 2016 (Dkt.
• Class Plaintiffs' motion for summary judgment
against Roxas: Class Plaintiffs filed their opening papers on
July 24, 2017 (Dkt. #369-372), Roxas filed an opposition
brief on August 25, 2017 (Dkt. #401), and Class Plaintiffs
filed their reply on September 11, 2017 (Dkt. #417);
• Bautista's motion for summary judgment against
Class Plaintiffs and the Republic: Bautista filed her opening
papers on June 1, 2016 (Dkt. #201-202, 208-209), Class
Plaintiffs filed an opposition brief on June 30, 2016 (Dkt.
#214), and an amended opposition brief on December 8, 2016
(Dkt. #313),  the Republic filed an opposition brief on
July 1, 2016 (Dkt. #225), and Bautista filed a reply on July
18, 2016 (Dkt. #241);
• Bautista's motion for summary judgment against
Roxas: Bautista filed her opening papers on July 24, 2017
(Dkt. #377, 388-390), and Roxas filed his opposition brief on
August 25, 2017 (Dkt. #401);
• Roxas's motion for summary judgment against Class
Plaintiffs and Bautista: Roxas filed his opening papers on
July 28, 2017 (Dkt. #383-386), Class Plaintiffs filed an
opposition brief on August 25, 2017 (Dkt. #398), which
Bautista joined by letter dated August 25, 2017 (Dkt. #407),
and Roxas filed a reply on September 11, 2017 (Dkt. #419);
• The Republic's motion to dismiss or, in the
alternative, to stay the case: the Republic filed its opening
brief on July 24, 2017 (Dkt. #374), and then refiled the
brief on August 29, 2017, and again on September 11, 2017
(Dkt. #411, 415), Class Plaintiffs filed an opposition on
August 25, 2017 (Dkt. #396), and a supplementary letter brief
on January 23, 2018 (Dkt. #426), Roxas filed an opposition
brief on August 29, 2017 (Dkt. #413), and the Republic filed
its reply on September 18, 2017 (Dkt. #422);
• S&P's motion to impose attorneys' liens:
S&P filed its opening papers on June 9, 2017 (Dkt.
#357-359), and no opposition papers were filed.
Court notes that, before the Republic filed the motion to
dismiss mentioned above, it had moved for partial summary
judgment against Class Plaintiffs. (See Dkt.
#197-200, 242). After the Republic caused various delays by
failing to make witnesses available for depositions
(see Dkt. #332), and by failing to address four
issues in a letter to the Court dated May 24, 2017 (Dkt.
#341), that were critically important to the Court's
adjudication of the Republic's claims (see Dkt.
#343), the Court sanctioned the Republic by, inter
alia, striking the Republic's pending motion
(see id.). Accordingly, the Court will not consider
that motion here, nor will the Court consider any of the
associated documents or evidence cited therein.
Summary Judgment Standard
56(a) provides that a “court shall grant summary
judgment if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see also Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986); Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 247-48 (1986). A genuine dispute exists where
“the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.”
Fireman's Fund Ins. Co. v. Great Am. Ins. Co. of
N.Y., 822 F.3d 620, 631 n.12 (2d Cir. 2016) (internal
quotation marks and citation omitted). A fact is
“material” if it “might affect the outcome
of the suit under the governing law[.]”
Anderson, 477 U.S. at 248.
the moving party “bears the initial burden of
demonstrating ‘the absence of a genuine issue of
material fact, '” ICC Chem. Corp. v. Nordic
Tankers Trading a/s, 186 F.Supp.3d 296, 301 (S.D.N.Y.
2016) (quoting Catrett, 477 U.S. at 323), the party
opposing summary judgment “must do more than simply
show that there is some metaphysical doubt as to the material
facts, ” Matsushita Elec. Indus. Co. v. Zenith
Radio Corp., 475 U.S. 574, 586 (1986); see also
Brown v. Henderson, 257 F.3d 246, 252 (2d Cir. 2001).
Rather, the non-moving party “must set forth specific
facts showing that there is a genuine issue for trial.”
Parks Real Estate Purchasing Grp. v. St. Paul Fire &
Marine Ins. Co., 472 F.3d 33, 41 (2d Cir. 2006) (quoting
ruling on a summary judgment motion, the district court must
construe the facts in the light most favorable to the
non-moving party and must resolve all ambiguities and draw
all reasonable inferences against the movant.”
Dallas Aerospace, Inc. v. CIS Air Corp., 352 F.3d
775, 780 (2d Cir. 2003). In considering “what may
reasonably be inferred” from witness testimony,
however, the court should not accord the non-moving party the
benefit of “unreasonable inferences, or inferences at
war with undisputed facts.” Berk v. St.
Vincent's Hosp. & Med. Ctr., 380 F.Supp.2d 334,
342 (S.D.N.Y. 2005) (quoting Cty. of Suffolk v. Long
Island Lighting Co., 907 F.2d 1295, 1318 (2d Cir.
1990)). Moreover, “[t]hough [the Court] must accept as
true the allegations of the party defending against the
summary judgment motion, … conclusory statements,
conjecture, or speculation by the party resisting the motion
will not defeat summary judgment.” Kulak v. City of
N.Y., 88 F.3d 63, 71 (2d Cir. 1996) (internal citation
omitted) (citing Matsushita, 475 U.S. at 587;
Wyler v. United States, 725 F.2d 156, 160 (2d Cir.
1983)); accord Hicks v. Baines, 593 F.3d 159, 166
(2d Cir. 2010).
are “a handy tool to protect a stakeholder from
multiple liability and the vexation of defending multiple
claims to the same fund.” Washington Elec. Co-Op,
Inc. v. Paterson, Walke & Pratt, P.C., 985 F.2d 677,
679 (2d Cir. 1993) (citations omitted). An interpleader is
triggered by “a real and reasonable fear of double
liability or … conflicting claims.” Id.
(internal quotation marks and citation omitted). “As a
remedial joinder device, interpleader is to be liberally
construed.” Weininger v. Castro, 462 F.Supp.2d
457, 500 (S.D.N.Y. 2006).
are two forms of interpleader: rule interpleader, under
Federal Rule of Civil Procedure 22; and statutory
interpleader, under 28 U.S.C. § 1335. Both serve the
same function of joining two or more adverse claimants to a
single proceeding in order, in turn, to promote efficiency
and to protect the stakeholder from multiple lawsuits.
Bradley v. Kochenash, 44 F.3d 166, 168 (2d Cir.
1995). Differences between the two concern personal and
subject matter jurisdiction, service of process, and venue.
See 4 J. Moore et al., Moore's Federal
Practice § 22.04 (3d ed. 2017). The most
important distinction involves the requirements for subject
matter jurisdiction. For rule interpleader, subject matter
jurisdiction must be based on Article III of the Constitution
and the jurisdictional statutes. In other words, “a
traditional basis for subject matter jurisdiction must
exist.” 6247 Atlas Corp. v. Marine Ins. Co., Ltd.,
No. 2A/C, 155 F.R.D. 454, 465 (S.D.N.Y. 1994). Statutory
interpleader, by contrast, requires only minimal diversity -
“that is, diversity of citizenship between two or more
claimants, without regard to the circumstance that other
rival claimants may be co-citizens.” State Farm
Fire & Cas. Co. v. Tashire, 386 U.S. 523, 530
the DANY filed the interpleader action under § 1335(a),
according to which district courts “have original
jurisdiction of any civil action of interpleader …
[involving] money or property of the value of $500 or more
… [and where t]wo or more adverse claimants [are] of
diverse citizenship[.]” This interpleader involves
parties that are citizens of the State of New York and of the
Republic of the Philippines, and the amount in controversy
far exceeds $500. (See generally Compl.). The Court
may therefore exercise subject matter jurisdiction.
actions typically proceed in two stages. In the first stage,
the Court determines “that the requirements of §
1335 are met and reliev[es] the plaintiff stakeholder from
liability[.]” N.Y. Life Ins. Co. v. Conn. Dev.
Auth., 700 F.2d 91, 95 (2d Cir. 1983). In the instant
matter, the Court has already determined that interpleader
was proper and ordered the deposit of the Interpleader
Property into the Court. (See Dkt. #72). The second
stage of the interpleader process requires the Court to
adjudicate the parties' adverse claims on the merits.
See Truck-A-Tune, Inc. v. Re, 856 F.Supp. 77, 79 (D.
Conn. 1993), aff'd, 23 F.3d 60 (2d Cir. 1994).
Equitable Nature of Interpleader Remedy
actions are often characterized as equitable in nature. The
Second Circuit has observed that “[i]nterpleader is an
equitable proceeding, ” Truck-A-Tune, Inc., 23
F.3d at 63, and district courts have long held similarly,
see, e.g., William Penn Life Ins. Co. v.
Viscuso, 569 F.Supp.2d 355, 362 (S.D.N.Y. 2008)
(“Although sanctioned by statute, interpleader is
fundamentally an equitable remedy.”); Citigroup
Glob. Mkts., Inc. v. KLCC Invs., LLC, No. 06 Civ. 5466
(LBS), 2007 WL 102128, at *7 (S.D.N.Y. Jan. 11, 2007)
(“[I]nterpleader is an equitable remedy that should be
applied liberally[.]”); Irving Tr. Co. v.
Nationwide Leisure Corp., 93 F.R.D. 102, 110 (S.D.N.Y.
1981) (“Interpleader is an equitable device[.]”).
References to interpleaders as an equitable remedy appear
with such frequency - but with such little exposition - that
claimants would be forgiven for wondering what role, if any,
the remedy's equitable nature plays in a court's
adjudication of the merits.
Court therefore pauses to provide some explanation of the
contours of interpleaders' equitable nature. The Court is
compelled to do so here, in part because some of the
claimants evince a rather expansive - and, in this
Court's view, impermissibly broad - understanding of
interpleaders' equitable nature. For example, in
Roxas's opposition to Class Plaintiffs' motion for
summary judgment, Roxas suggests that this Court may consider
equitable principles even where they might conflict with
traditional legal principles and that the Court may exercise
its broad discretion to fashion a remedy that achieves equity
but derogates well-established legal principles.
(See Roxas SJ Opp. Class Plaintiffs 14 (“In
sum, in weighing the equities among the parties, the Court
should favor [Roxas].”)).
Court does not understand its discretion to be quite so
broad, nor the equitable principles that apply to
interpleader actions to be quite so far-reaching. To be sure,
interpleader is an equitable remedy. But the Court is still
required to apply legal principles in adjudicating the merits
of the parties' claims. The U.S. Supreme Court has
advised that “[c]ourts of equity can no more disregard
statutory and constitutional requirements and provisions than
can courts of law.” Armstrong v. Exceptional Child
Ctr., Inc., 135 S.Ct. 1378, 1385 (2015) (quoting
I.N.S. v. Pangilinan, 486 U.S. 875, 883 (1988)). In
the interpleader context, courts in this Circuit have held -
properly so - that legal, rather than equitable, principles
govern the adjudication of the merits. See, e.g.,
XL Specialty Ins. Co. v. Lakian, 243 F.Supp.3d 434,
448 (S.D.N.Y. 2017) (“[Party's] appeal to the
Court's equitable powers does not justify deviating from
the clear legal principles in this case.”).
review of the context in which courts discuss the equitable
nature of interpleaders is revealing: Courts most often do so
in deciding whether to allow an interpleader to go forward at
all; they rarely do so in adjudicating the merits of the
parties' competing claims. See, e.g.,
Truck-A-Tune, 23 F.3d at 63; Great Wall De
Venezuela C.A. v. Interaudi Bank, 117 F.Supp.3d 474,
483-84 (S.D.N.Y. 2015); Viscuso, 569 F.Supp.2d at
362. The equitable nature of the remedy, in other words,
applies principally at step 1 (determining whether
interpleader is proper), not at step 2 (deciding the merits).
To the extent that a court has greater discretion in the
interpleader context than it does in other contexts, that
discretion finds its currency in a court's decision to
permit a plaintiff to consolidate multiple adverse claims
into a single action in order to “protect [the
plaintiff] from vexatious and multiple litigation.”
State Farm Fire & Cas. Co., 386 U.S. at 534. It
does not provide courts with latitude to eschew clear legal
principles in favor of an amorphous sense of equity.
Lakian, 243 F.Supp.3d at 448.
that, the Court turns to the choice of law issue, which this
Court previously addressed, but was unable to decide, at the
motion to dismiss stage because the parties “ha[d] not
provided the Court with sufficient information[.]”
Philippines I, 2016 WL 9022580, at *3.
Choice of Law
Court addresses the threshold issue of which law should apply
to the parties' claims. At the motion to dismiss stage,
this issue was raised, with Class Plaintiffs and the Republic
advancing competing views of the applicable law. Then, the
Republic argued that Philippine Law R.A. 1379 applies to -
and is dispositive of - the question of ownership of the
Interpleader Property. (See Dkt. #89 at 9-10). Class
Plaintiffs, for their part, argued that Philippine law did
not apply, and that the action instead was governed by New
York law. (See Dkt. #99 at 3-7). Class Plaintiffs
suggested, in the alternative, that the law of Switzerland or
Liechtenstein might apply to some subset of questions
regarding the funds that the Trinidad Foundation had
deposited in a Swiss bank account, but that, in any event,
Philippine law could not apply. (Id. at 3 n.3).
denying the motion to dismiss, this Court wrote at some
length on the choice of law issue, which it characterized as
“[p]erhaps the most perplexing issue
presented[.]” Philippines I, 2016 WL 9022580,
at *3. It observed that two statutory schemes arguably were
relevant to determining the controlling law: (i) the
interpleader statute, 28 U.S.C. § 1335; and (ii) the
Foreign Sovereign Immunities Act (the “FSIA”), 28
U.S.C. §§ 1602-1611. The Court found that, under
either statute, New York choice of law principles apply. As
the Court explained, “[w]hen a federal interpleader
action ‘is based on [ ] diversity of citizenship
… courts apply the [choice of law rules] of the forum
state[.]'” Id. (alterations in original)
(quoting KLCC Invs., LLC, 2015 WL 5853916, at *6).
And, “in FSIA cases, we use the forum state's
choice of law rules to resolve all issues, except
jurisdictional ones.” Id. (quoting Karaha
Bodas Co., ...