D istri ct Ju d g e Je d S
. R ak o ff o f th e U n it ed S tat es D istrict C o u rtfo r th e S o u thern * D i s tr i ctof N ew Y or k, s i t t i ng bydes i gnat i on. 09-0993 -cv Boc cardi Capi ta l Sy stems v. D.E . Sh aw Lami nar Portfol ios

UNI TED S TATES CO URT O F AP PEALS F O R T H E S E C O N D C IR C U IT S UM M ARY OR DER R U LI N GS BY S U M M A R Y O R D ER D O NO T H A V E PREC EDEN TI A L EFFECT . CI T AT I ON TO S UM M ARY O R D E R S F IL E D A F T E R JA N U A R Y 1, 20 0 7 , I S P E R M ITT E D A N D I S G O V E R N E D B Y T H IS C O U R T ’S LO C A L RU LE 32 . 1 AN D FEDER A L RU LE O F AP PELLA TE PRO C EDU R E 32 . 1. I N A B R I EF O R O TH ER P A P E R I N WHI C H A L I T I G A N T C I T E S A S UM M ARY OR D E R , I N E A C H P A R A G R A P H I N WHI C H A C I T A T I ON A P P E A R S , A T L E A S T ON E C I T A T I ON M U S T E I T HE R B E T O T HE F E D E R A L AP P E N D I X OR BE ACCO M PA NI E D BY T HE NOT AT I ON: ( S UM M ARY ORDE R) . A PA RT Y CI T I NG A S UM M ARY O R D E R M U S T S E R V E A C O P Y O F T H A T S U M M A R Y O R D E R T O G E T H E R W IT H T H E P A P E R IN W H I C H TH E S U M M A R Y O R D ER I S C I TED O N AN Y PAR TY N O T REPR ESENTED BY CO U N SEL U N L E S S T H E S U M M A R Y O R D E R IS A V A IL A B L E IN A N E L E C T R O N IC D A T A B A S E W H IC H IS PU BL I CL Y ACC E S S I BL E W I T HO UT P AYM E NT OF F E E ( S UCH AS THE DAT ABAS E AVAI L ABL E AT H TTP: // W W W . C A 2. U SCO U R TS. GO V / ) . I F NO CO PY I S SERV ED BY REA SO N O F TH E AV A I LAB I LI TY OF TH E O R D ER ON S UCH A DAT ABAS E , T HE CI T AT I ON M US T I NCL UDE RE FE RE NCE T O THAT DAT ABAS E AND T HE DOCKET NUM BE R OF T HE CA S E I N W HI CH THE ORDE R W AS E NT E RE D. A t a s tate d ter m o f

th e U n ited S tate s C o u rt o f A p p e a ls f

o r th e S e c o n d C irc u it, h e ld atthe D ani el Patr i ck M oyni han U ni t ed St at es C our thous e, 500 Pear l St r eet , i n the C i t yof N ew Y or k, on t he 9 dayof D ece m ber , tw o thous and ni ne. th PRES ENT: J O H N M . W A L K E R , J R .,

R E E N A R A G G I,

C i r cui tJudges , J ED S. RA K O FF,

D is tr i ct Judge
. *

--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- B O C C A R D I C A P IT A L S Y S T E M S , IN C ., P lai nt i f f

-Appel lant , v. N o. 09- 0993- cv D .E . S H A W L A M IN A R P O R T F O L IO S , L .L .C ., D ef endant

-Appel l ee .

--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---2

A P P E A R IN G F O R A P P E L L A N T : R U S S E L L I. G L A Z E R (K a th le e n E . H o ltz , on the br i ef ) , T r oy goul d PC , L os A ngel es , C al i forni a. A P P E A R I N G F O R A P P E L L E E : M I CH AEL R I PS (J ohn D
. L o v i , La r a E. R o m a n s ic , J u s tin B . P e rr i, on the br i ef ) , St ept oe & J ohns on L L P, N ew Y or k, N ew Y or k. A p p ea l from the U n it ed S tat es D istri ct C o u rt fo r the S o u thern D istri ct of N ew Y o rk (G e o rg e B . D a n ie ls , Judge ). UP ON DUE CO NS I DE RA T I ON, I T I S HE RE BY OR DE RE D, ADJ UDGE D, AND D E C R E E D thatthe j udgm entent er ed on February9, 2009, i s AF F I RMED
. B o c c a rd i C a p ital S y ste m s, In c . (“B o c c a rd i”) a p p e a ls th e d ism iss a l o f th is d iv e rsity act i on as s ert i ng comm on- l aw cl ai m s agai ns tD. E. Sh a w Lami narPor t fol i os , L
. L
. C
. ( “Shaw ”) bas ed o n th e f

a i l u r e o f th e p a r t i e s ’ c o n t e mpl a t e d j o i n tt a k e o v e ro f Ri v i e r a H ol di ng C orpor at i on ( “R i vi er a”) , a hot el and ca s i no oper at or . W e r evi ew a R ul e 12( b) ( 6) di s m i s s al de novo, “co n stru[i ng] [the] compl ai ntl i ber al l y , acc ept i ng al l fac tual al l egat i ons i n t he compl ai ntas true, and dr aw i ng al l r easo n ab le in fer ence s i n the pl ai nt i ff’ s favor
. ” H ol m es
v . G ru b m a n , 5 6 8 F .3 d 3 2 9 , 3 3 5 (2 d C ir. 2 0 0 9 ) (in ter n a l q u o tatio n m a rk s o m itt e d ). T o a v o id di s m i s s al , the compl ai nt m us t “s t at e a cl ai m t o r el i ef that i s pl aus i bl e on i t s fac e. ” A s hcr oft
v . I q b a l , 1 2 9 S
. Ct
. 1 9 3 7 , 1 9 4 9 ( 2 0 0 9 ) ( i n t e rn a l q u o t a t i o n ma r k s o mi t t e d )
. W e a s s ume fami l i ar i tyw i th the fa ct s and the rec o rd of pr i orpr ocee di ngs , w hi ch w e r efe r ence onl yas
n e c e s s a ryt o e x p l a i n o u rd e c i s i o n t o a f f i r m. 1. B r eac h of C ontr act B o c c a rd i co n ten d s th a t th e d is trict c o u rt e rre d in ru lin g th a t itf a iled to p lea d f

a c ts3

s uff i c i e n tt o s t a t e a c l a i m f o rSh a w’ s b r e a c h o f

a “ Con f i d e n t i a l i tya n d Us e Re s tr i c t i on A g re e m e n t” ( th e “ A g re e m e n t”) . B o c c a rd i as se rts th a t, pu rsu a n t to th e A g re e m e n t, i t pr ovi ded S h aw w i th confi dent i al i nform at i on, i ncl udi ng i t s bus i nes s pl an foracqui r i ng contr ol of R i vi er a, i n excha nge forw hi ch S haw pr om i s ed not t o di vul ge t he i nform at i on or
us e i t otherthan i n connec t i on w i th the pl anned j oi ntt akeove r . T he compl ai ntal l eges t hat Shaw br eac hed the A gr eementbypur chas i ng bl ocks of R i vi er a s t ock and l at erm aki ng a publ i c bi d for the com panyw hi l e r efus i ng t o perm i tB occa r di t o exer ci s e purpor t ed opt i ons t o p urchase a po rt i on of it s st ake o r t o v ote i t s shar es. B o cc ard i’ s claim fo r b rea ch o f co n tr ac t w as p rop erly d ism issed
. A s the d istri ct co u rt
o b served, the compl ai nti t s el f as s ert s thatShaw pur chas ed R i vi er a s t ock w i th B occa r di ’s “as s i s t ance and advi ce, ” and “i n as s oci at i on w i th” B occa r di
. A m . C om pl
. ¶ 24. B o cc ardi does notdi s put e thati t acqui es ced i n the pur chas e; r ather , i t cont ends that i t di d s o bas ed “on
c o n d iti o n s th a t n e v e r m a ter ializ e d ,” A p p e llan t’s B r. at 2 7 , an a p p a r e n t r e f e re n c e to its expec t at i on of a f

ur theragr eementr egard i ng opt i ons . B uts uch an a gr eementnever
m at er i al i zed, and Shaw i s not bound by B occa r di ’ s m er e expec t at i on thatitw o u ld. See J os eph M art i n, J r . D el i cat es s en, I nc. v. Schum ache r , 52 N
. Y
. 2d 105, 109, 417 N
. E
. 2d 541, 5 4 3 (19 8 1 ) (no ti n g that “a g ree m en t t o ag ree ” is u n en fo rce ab le). N o r do es th e c o m p lai n t al lege fa cts ind icati n g that S h aw reli ed o n B o cc ard i’ s
c o n f i d e n t i a l i n f

o r ma t i o n i n ma k i n g i t s s u b s e q u e n t p u b l i c b i d f o rRi v i e r a . Bo c c a r d i c l a i ms to h a v e a d v ise d S h a w th a t s u c h a b id w o u ld c a u se th e sh a re p ric e to in c re a se , b u t ev e n if4

S h a w re lied u p o n th is u n e x tra o rd in a ryp re d ictio n , n o f a c tf in d e r c o u ld c o n c lu d e th a t it
c o n stitu ted c o n f

id e n tial in f

o rm a tio n w ith in th e m e a n in g o f th e A g re e m e n t, w h ich e x p re ss ly
e x c lu d e d f

ro m th a t d e f

in itio n “ in f

o rm a tio n . . . g e n e ra lly a v a ila b le to th e p u b lic .” C f. B uhl er
v. M i chael P
. M al on eyC on sul t i ng , Inc. , 29 9 A
. D
. 2d 19 0, 19 1, 74 9 N
. Y
. S
. 2d 86 7, 86 8 (1st D e p ’t 2 0 0 2 ) (h o ld in g th a t co n tac t li st b a se d o n , inte r a lia, “ in f o rm a tio n th a t w a s p u b licly
av ail ab le” d id n o t qu ali fyas trad e se cre t)
. B e c a u se w e c o n c lu d e th a t B o c c a rd i f a ils to sta te a c laim f

o r b re a c h o f

th e A g re e m e n t,
w e nee d notaddr es s i t s cont ent i on thati ti s now ent i t l ed t o a sh are of Shaw ’ s pr ofi t s fr om the ac qui r ed s t ock. See A ppel l ant ’ s B r . at 32 ( cl ai m i ng that Shaw “w as not at l i berty t o keep fori t s el f the pr opertyi tobt ai ned byus i ng the i nform at i on”). W e not e, how ever , thatt he A gr eementr equi r ed Shaw t o us e B occa r di ’ s i nform at i on onl y t o advanc e the pl anned j oi nt t akeove rand t o r eturn ordes tr oythe i nform at i on i f i tdeci ded nott o parti ci pat e. T he A g re e m e n t d id n o t re q u ire S h a w to d iv e st itse lf o f p ro p e rtyin th a t ev e n t. O urconcl us i on thatB occa r di has fai l ed s uffi ci ent l yt o al l ege a br each o f cont r act compel s a s i m i l ar concl us i on r es pect i ng i t s cl ai m , gr ounded i n the s ame f actual pr edi cat e, for br eac h of the i m pl i ed dutyof good fa i th and fa i rdeal i ng. See N at i onal M kt
. Shar e, I nc. v. St er l i ng N at ’ l B ank, 392 F. 3d 520, 525 ( 2d C i r . 2004) ( “I n N ew Y or k, br eac h of the i m pl i ed dutyof good fa i th and fai r deal i ng i s m er el y a br eac h of the under l y i ng contr act . ” ( i nt ernal quot at i on m arks om i t t ed) ) ; s ee a l s o M urphyv. A m . H om e Pr ods
. C orp. , 58 N
. Y
. 2d 293, 304, 4 4 8 N
. E
. 2 d 8 6 , 9 1 (19 8 3 ).5

2
. B re a c h o f

F id u c iar yD u ty W e al s o agr ee w i th the di s tr i ctcourtthatB occa r di fai l ed ade quat el yt o pl ead the
e x iste n c e o f

a f id u c iar yre latio n sh ip b e tw e e n itse lf a n d S h a w . “A f

id u c iar yre latio n sh ip exi s t s underN ew Y or k l aw w hen one [per s on] i s under a dut y t o act for or t o gi ve advi ce f or th e b e n e f

it o f a n o th e r u p o n m a tters w ith in th e sc o p e o f th e re latio n .” F lick in g e r v . H a ro ld C
. B row n & C o . , 9 4 7 F
. 2 d 5 9 5 , 5 9 9 (2d C ir
. 1 9 9 1 ) (i n terna l q u o ta tio n m a rk s o m itted). H ow ever , “[w ] hen part i es deal at arm [’ ] s l ength i n a comm er ci al tr ans act i on, no r el at i on of confi dence or trus t s uffi ci ent t o fi nd the exi s t ence of a fi duci ary r el at i ons hi p w i l l ar i s e abs ent extr aor di naryci r cumst ance s . ” I n r e M i d- I s l and H os p. , I nc. , 276 F. 3d 123, 130 ( 2d C i r . 2002) ( i nt ernal quot at i on m arks om i t t ed)
. N o s uch ci r cumst ance s ar e pl eade d her e. T he compl a i n ta l l e g e s thatShaw ow ed B occa r di a fi duci arydutybeca us e Shaw agr eed t o actas i t s “underw r i t er , i nves t m entbankerand fi nanci er . ” A m . C om pl
. ¶ 42. A s the di s tr i ct c o u r tcorr ect l yobs erved, how ever , the compl ai nt ’ s fac tual al l egat i ons , i f pr oved,
w oul d notes t abl i s h that S h aw agr eed t o actas B occa r di ’ s “fi nanci er ”; r ather , B occa r di expec t ed t o fi nance i t s ow n p art i ci pat i on. See i d. ¶¶ 19- 21. N orw oul d Shaw ’ s r ece i ptof confi dent i al i nform at i on, w i thoutm or e, tr ans form i ti nt o B occa r di ’ s fi duci ary . T he ca s es B occardi ci t es in supp ortof thi s content i on are di st i ng uis hab l e. S ee, e. g. , JPM organ C hase Ba n k , N. A. v . I DW Gr o u p , L L C, No
. 0 8 Ci v . 9 1 1 6 , 2 0 0 9 WL 3 2 1 2 2 2 , a t* 1 0 , 1 2 ( S
. D. N. Y. F e b . 9 , 2 0 0 9 ) (h o ld in g d u ty e x iste d w h e re a lleg e d f id u c iar yre c e iv e d “ a g re a t d e a l o f h ig h ly
con fi den t i al and sensi t i ve inform at i on , ” cult i vated rel at i on shi ps w i th p ri ncipal ’s em ploy ees,6

and ac t ed as pr i nci pal ’ s advi ser “in a posi t i on of extr aor di narytrus t ” ( i nt ernal quot at i on
m arks om i t t ed) )
. T her e i s no al l egat i on thatShaw agr eed t o “ac t for ort o gi ve advi ce f ort he b en ef ito f” B o cc ard i. F li ck in g e r v . H a ro ld C
. B row n & C o . , 9 4 7 F
. 2 d at 59 9
. R athe r, Bo c c a r d i c l a i ms th a tth e p a r t i e s “ wo r k [ e d ] t o g e th e rt o a c q u i r e c o n tr o l o f Ri v i e r a . ” Am. C o m p l. ¶ 28
. F inally , B o cc ard i h as no t su ff ici en tl y all eg ed the e x ist en ce o f a joint ve n ture i n l i ghtof i t s fai l ur e t o pl ead f act s s ugges t i ng i t w oul d have sha r ed i n any l os s r es ul t i ng fr om S h aw ’s i n v estm en t i n R iviera. Se e B row n v . C ara , 4 2 0 F
. 3 d 1 4 8 , 1 5 9 -60 (2d C ir
. 2 0 0 5 ). 3. C ons truct i ve Trus tand U nj us tE nr i chment B occa r di ’ s quas i
- contr actual cl aim s , s eeki ng i m pos i t i on of a c ons truct i ve trus tand recoveryun der a theo ryof u njustenri chm ent, are pr ecl ud ed bythe ex i st ence o f an e xp res s
w r i t t e n a g r e e me n tg o v e r n i n g th e s u b j e c tma t t e ra ti s s u e , i
. e . , Boc c a r d i ’ s c o n f i dent i al inf o rm ati o n . S ee In re F ir st C e n t. F in
. C o rp., 3 7 7 F
. 3 d 2 0 9 , 2 1 3 (2d C ir
. 2 0 0 4 ) (“[W ]e concl ude thatthi s pr i nci pl e – that the exi s t ence of a w r i t t en agr eementpr ecl udes a fi ndi ng of unj us tenr i chment– al so appl i es t o cons truct i ve trus tcl ai m s . . . . ”) ; C i tyof Y onker s v. O t i s E l evatorC o. , 84 4 F
. 2d 42 , 48 (2d C i r. 19 88 ) ( “O ur di sposi t i on of the con tractcl ai m al so d ispo ses o f th e q u asi-co n tr ac tual ca u se o f a ctio n , b ec au se su ch reli ef is un av ail ab le w h ere
a n e x p r e s s c o n tr a c tc o v e r s th e s u b j e c t ma t t e r . ” ) ; Cl a r k
- F i t z p a tr i c k , I n c . v . Lo n g I s l a n d R. R. C o . , 7 0 N
. Y
. 2 d 3 8 2 , 3 8 8 , 5 1 6 N
. E
. 2 d 1 9 0 , 1 9 3 (19 8 7 ). 4. L eave T o A m end Fi nal l y , B occa r di cont ends tha tthe di s tr i ctcourts houl d have a ffor ded i ta s econd7

oppor tuni tyt o amend i t s compl ai nt . O r di nar i l y , w e r evi ew a d en ial of l eave t o amend for abus e of di s cr et i on. See Pat ane v. C l ark, 508 F. 3d 106, 113 n. 6 ( 2d C i r . 2007)
. I n thi s cas e, B o c c a rd i n e v e r re q u e ste d lea v e . N o r h a s it sh o w n th a t am e n d m e n t w o u ld h a v e p e rm itt e d it to su rviv e d ism issal. T h e a d d it ion al fa cts i t p ro ff ers, i f p rov ed , m igh t dem o n str ate injury fol l ow i ng Shaw ’ s conduct , butnotthatShaw br eac hed t he A gr eement . T he al l egat i on t hat Shaw advi s ed B occa r di not t o s eek other fi nanci ng i s contr adi ct ed by the compl ai nt . A nd t he b a re p ro m ise th a t S h a w w o u ld “ a c t to p ro tec t [ its] i n ter e sts ” w o u ld b e in su f f icie n t, ev e n if pr oven, t o demonstr at e the “e xtr aor di naryci r cumst an ce s” requi r ed forthe cr eat i on of a fi duci aryr el at i ons hip. In r e M i d- I s l and H os p. , I nc. , 276 F. 3d at130 ( i nt ernal quot at i on
m arks om i t t ed)
. T hus , the di s tr i ctcourtdi d n o t e rrbydi s m i s s i ng the compl ai ntw i thout gr ant i ng l eave t o amend. See P ani v. E m pi r e B l ue C r os s B l ue Shi el d, 152 F. 3d 67, 76 ( 2d C ir
. 1 9 9 8 ). W e have c ons i der ed B occa r di ’ s r emai ni ng ar gum ent s on appea l , and w e conc l ude that th e ya r e wi th o u tme r i t . Ac c o r d i n g l y , th e j u d g me n to f th e d i s tr i c tc o u r ti s AF F I RMED
. FOR TH E CO UR T: C A T H E R IN E O ’H A G A N W O L F E , C lerk o f C o u rt

B y :

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