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District Attorney of New York County v. Republic of Philippines

United States District Court, S.D. New York

March 29, 2018



          KATHERINE POLK FAILLA United States District Judge

         The 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”).

         Pending 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).

         The 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 attorneys' liens.


         A. Factual Background

         This interpleader action is the latest in what is now a long series of proceedings - spanning decades and pursued in numerous jurisdictions[2] - 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 pending motions.

         1. Ferdinand Marcos's Presidency, and the Presidential Commission on Good Government

         Ferdinand 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. 15).

         In 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).

         In 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).

         The 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.).

         2. Interpleader Property

         The 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 ¶ 21).

         a. The 1975 Acquisition of Monet's L'Église et La Seine à Vétheuil and Sisley's Langland Bay

         On 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, Philippines.” (Id.).

         b. The 1977 Acquisition of Monet's Le Bassin aux Nymphéas

         On 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.).

         In 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 ¶¶ 32-33).

         c. The Display and Subsequent Removal of the Paintings

         During 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).

         Bautista 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 Tower apartment.

         d. Bautista's Sale of the Water Lily Painting, and Her Subsequent Prosecution

         i. Sale of the Water Lily Painting

         On 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[ ].” (Id.).

         In a 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.” (Id.).

         Bautista 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 representative.” (Id.).

         ii. Bautista's Criminal Prosecution

         In 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.).

         On 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 conviction.

         3. Prior Judgments That Claimants Seek to Enforce in This Interpleader

         a. Roxas's Hawaii Judgment

         Roxas brought suit against Mr. and Mrs. Marcos in Hawaii state court on February 19, 1988, alleging then - as he[3] 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).

         The 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[4] 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).

         Mrs. 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.

         The 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.

         However, 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 Judgment”).

         b. Class Plaintiffs' Hawaii Judgment

         Roxas 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.

         In 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.

         B. Procedural Background

         On 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).

         On 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.

         Currently 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. #240);
• 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), [5] 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.

         The 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.


         A. Applicable Law

         1. Summary Judgment Standard

         Rule 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.

         While 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 Fed.R.Civ.P. 56(e)).

         “When 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).

         2. Interpleader Actions

         Interpleaders 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).

         There 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[1] (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 (1967).

         Here, 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.

         a. Two-Step Analysis

         Interpleader 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).

         b. Equitable Nature of Interpleader Remedy

         Interpleader 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.

         This 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].”)).

         The 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.”).

         A 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.

         With 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.

         3. Choice of Law

         The 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).

         In 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., ...

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