Michael J. Frevola

HOLLAND & KNIGHT LLP

195 Broadway

New York, New York 10007-3189

(212)513-3200

ATTORNEYS FOR PLAINTIFF

WILHELMSEN PREMIER MARINE FUELS AS

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

WILHELMSEN PREMIER MARINE FUELS AS,

Plaintiff,

-againstUBS PROVEDORES PTY LTD. a/k/a

USS-UBS INTERNATIONAL and

RAECORP INTERNATIONAL PTY LTD.,

Defendants,

07 Civ. 5798 (CM)

REPLY MEMORANDUM IN FURTHER SUPPORT OF PLAINTIFF'S AMENDED

MOTION TO VACATE THE COURT'S ORDER OF DISMISSAL

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 1 of 8
PRELIMINARY STATEMENT

In their opposition to Wilhelmsen's Amended Motion to Vacate the Court's Order of

Dismissal, Defendants continue to maintain that they have not acted improperly. Yet they refuse

to reveal full versions of documents that they contractually agreed to provide in the parties'

Settlement Agreement regarding a central issue in this dispute; namely, for what reason was

UBS paid $3.5 million in December 2007? Defendants steadfast refusal to provide these

documents or to reveal any information about UBS's purported "surge claim" strongly suggests

that Defendants have something to hide. And Defendants' recently-filed opposition papers help

to fill in the picture.

REPLY TO DEFENDANTS' STATEMENT OF FACTS

A page 4 of their brief, Defendants quote the "Government Claims" portion of the

Settlement Agreement for the Court and state that "[t]o date, the U.S. Government has not paid

UBS any amounts in relation to the Government Claims."

What Defendants do not tell the Court, and what only became apparent in Defendants'

most recent submission, is that Defendants misrepresented the nature of their claims under

Invoice 10039 in negotiating the Settlement Agreement. In the portion of the Settlement

Agreement quoted by Defendants, it states that the $3,180,853.58 invoiced for the "Government

Claims" were "amounts invoiced pursuant to invoice number 10039 and concerning bunkerings

reflected in Exhibit 1 [of the Settlement Agreement], which claim presently is under review by

the U.S. government." (emphasis added).

Comparing Exhibit 1 of the Settlement Agreement (which contains twelve separate

bunkerings of various vessels) with Invoice 10039 - an unredacted copy of which was produced

for the first time as Exhibit A to the Hennessy Supplemental Declaration dated June 17, 2008 -

shows that not a single vessel listed in Exhibit 1 is claimed by UBS on Invoice 10039. Simply

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 2 of 8
put, under the Settlement Agreement UBS told Wilhelmsen that it was claiming for the

Wilhelmsen bunkerings under Invoice 10039, and now Wilhelmsen has discovered 9 months

later that Invoice 10039 had nothing to do with the Wilhelmsen bunkering claims.

The question that this begs is - if the Wilhelmsen bunkerings were not claimed under

Invoice 10039, under what invoice were they claimed? Based on Defendants' refusal to reveal

documents that they contractual undertook to produce (those relating to the Government Claims),

and their refusal to release any documents regarding the purported "surge claim," the strong

suggestion is that Wilhelmsen's bunkering claims were paid by the government in December

2007 when it paid the purported "surge claim."

Furthermore, numbered paragraph 6 of the Settlement Agreement requires UBS to use its

"best endeavors" to recover from the government on the Government Claims, which UBS

represented were the Wilhelmsen bunkering claims. If Invoice 10039 does not refer to the

Wilhelmsen bunkerings, and if the "surge claim" does not relate to the Wilhelmsen bunkerings.,

then where is UBS's claim for those bunkerings that it promised to use its "best endeavors" to

pursue?

Despite the fact that Defendants have been removed from the government contract, and

despite the fact it would be quite easy to produce the proof necessary to dispel Wilhelmsen's

claims if they were not valid, Defendants answer none of these questions. Rather, they choose to

use procedural defenses and a self-serving UBS declaration to oppose Wilhelmsen's motion.

And they submit documents to the Court for in camera review despite the law being well-settled

that such behavior is not permitted. Wilhelmsen respectfully submits that the Court should not

countenance Defendants' behavior, but rather should vacate its order of dismissal.

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 3 of 8
POINT I

VACATING THE DISMISSAL ORDER IS WARRANTED

Defendants argue at page 6 of their brief that Wilhelmsen has a heavy burden in seeking

to vacate the dismissal order because the "agreed upon settlement" of the dispute. But how could

there be a legitimate "agreed upon settlement" where Defendants misrepresented a major element

of consideration - that they had a claim pending before the U.S. government for the 12

Wilhelmsen bunkerings, on which Wilhelmsen would first be paid $2.1 million if such claim

prevailed? From what Defendants have produced, unless the "surge claim" was the claim for

Wilhelrnsen's bunkers, there does not appear to have been any claim filed with the government

by UBS for the purpose of recovering payments required to be made to Wilhelmsen. This is a

grave misrepresentation of consideration in the Settlement Agreement. If Wilhelrnsen's position

turns out to be correct, Wilhelmsen should have the right to rescind the Settlement Agreement or

sue for breach of an executory accord on grounds that Defendants misrepresented material facts

in the Settlement Agreement and provided illusory consideration.

While Wilhelmsen referred to Rule 60(b)(6) in its initial brief, it was unaware at that time

that Defendants had misrepresented the nature of Invoice 10039 in the Settlement Agreement.

This misrepresentation only came to light on a little more than a week ago, when UBS - for the

first time - provided an unredacted copy of Invoice 10039 as Exhibit A to the Hennessy

Supplemental Declaration. That invoice makes clear that UBS misrepresented in the Settlement

Agreement the nature of its claims to the government made under Invoice 10039. This evidence

either should be treated as newly discovered evidence under Rule 60(b)(2) or fraud,

misrepresentation, or other misconduct of an adverse party under Rule 60(b)(3).

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 4 of 8
A. Newly Discovered Evidence

Under Rule 60(b)(2), newly admitted evidence may be admitted in the following

circumstances:

Specifically, in [seeking vacatur on Rule 60(b)(2) grounds], the movant must

demonstrate: (1) that the newly discovered evidence was of facts that existed at

the time of the prior dispositive proceeding, (2) that the movant was justifiably

ignorant of the facts despite due diligence, (3) that the evidence is admissible and

of such importance that it probably would have changed the outcome, and (4) that

the evidence is not merely cumulative or impeaching.

Commer v. McEntee, No. 00 Civ. 7913 (RWS), 2005 WL 1250214, at *2 (S.D.N.Y. May 27,

2005). In Commer, the plaintiff was provided an affidavit from one of the defendants admitting

the claimed wrongful acts after the court had granted summary judgment in defendants' favor.

The plaintiff introduced the affidavit in connection with a Rule 60(b)(2) motion, and the court,

finding all the elements were met, granted the motion to vacate the summary judgment.

Here, at the time that Defendants moved for dismissal in January 2008 on grounds that

they were entitled to such relief, they claimed that they had provided Wilehelmsen with its

bargained for consideration and that this case should be dismissed. As it so happens, on June 17,

2008, a representative of defendant UBS has presented a document which shows that UBS had

misrepresented the consideration offered, which entitles Wilhelmsen to rescind the Settlement

Agreement or claim for breach of an executory accord. This satisfies element (1).

Next, Wilhelmsen unquestionably was ignorant of the facts because Defendants delayed

in producing them and them produced them in redacted form. No amount of due diligence could

overcome UBS's obstinate refusal to comply with its obligation to produce the documents, and

when Wilhelmsen argued against dismissal on this grounds, it was rejected. Hence, element (2)

is satisfied.

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 5 of 8
The fact that Defendants convinced Wilhelmsen to settle a $2,1 million claim based on a

misrepresentation as to what consideration it was receiving in return is extremely important. As

discussed above, it appears that Defendants may never have filed claims based on Wilhelmsen's

bunkering claims, but convinced Wilhelmsen to compromise a $2.1 million claim based on its

misrepresentations, then tried to cover its tracks by seeking to dismiss this case summarily and

producing redacted documents to hide any wrongdoing. The misrepresentation of this element of

consideration, even if innocent, constitutes a ground to rescind the contract based on a failure of

consideration. This certainly would change whether Defendants could dismiss this lawsuit

because they had satisfied all of their obligations. Thus, element (3) is satisfied.

It is clear that the evidence regarding the Settlement Agreement is not cumulative or

impeaching. No previous indication of this misrepresentation was disclosed, and Defendants

attempted to hide their tracks through producing redacted documents. The evidence serves to

support a rescission or breach of executory accord defense and/or claim. Accordingly, element

(4) is satisfied.

Because all of the elements of the "newly discovered evidence" prong of Rule 60(b) are

satisfied, Wilhelmsen is entitled to an order vacating the dismissal entered by this Court against

Wilhelmsen in this proceeding.

B. Fraud, Misrepresentation or Other Misconduct By the Other Party

Under Rule 60(b)(3), reopening of the underlying matter is most often granted where the

fraud, misrepresentation, or other misconduct by the opposing party is not capable of being

discovered by the due diligence of a party seeking to vacate the judgment until after the

judgment. See, e.g., In re Lawrence, 293 F.3d 615, 625-26 (2d Cir. 2002) (vacating judgment

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 6 of 8
and remanding for Rule 60(b)(3) consideration where sale of stock in bankruptcy court to

corporate insiders raised suggestion of fraud or misconduct where stock subsequently quadrupled

in value several weeks later after company's release of new invention); see also Fluoro Elec.

Corp. v. BranfordAssocs., 489 F.2d 320, 324 (2d Cir. 1973) (affirming district court's vacatur of

judgment against incorrect defendant and sanctioning proper defendant for frivolous appeal

where defendant had obligation of advising court of factual error rather than allowing it to

proceed under mistaken assumption).

Here, Defendants approached this Court to dismiss this case in January after they already

had been advised by Wilhelmsen that the Initial Payment had not been completed. Nevertheless,

even after Defendants' counsel acknowledged having received Wilhelmsen's position - albeit

claiming to have received it several hours after it was sent - Defendants never corrected their

application to this Court for dismissal. The very next business day, this Court dismissed this

case based on Defendants' misrepresentations and/or failure to correct their application. Under

Fluoro Electric Corp., this in and of itself is grounds to vacate the dismissal order.

Even more serious is UBS's redaction of its documents and refusal to provide the

information that it was contractually obliged to provide, which prevented Wilhelmsen from

discovering UBS's fraud, misrepresentation or misconduct until after this Court had issued its

dismissal order. The first notice that Wilhelmsen had of the defect in consideration promised

under the Settlement Agreement was several days ago. As in Lawrence, this affirmative

concealment of the facts behind redacted documents - which documents were redacted by

Defendants ~ justifies the vacatur of the dismissal order based on Defendants' fraud,

misrepresentation or misconduct pursuant to Rule 60(b)(3).

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 7 of 8
Because the "fraud, misrepresentation, or other misconduct by the opposition" prong of

Rule 60(b) is satisfied, Wilhelmsen is entitled to an order vacating the dismissal entered by this

Court against Wilhelmsen in this proceeding.

CONCLUSION

Wilhelmsen, for the reasons set forth above, respectfully renews its request that the Court

vacate its order of dismissal so that Wilhelmsen can proceed against Defendants.

Dated: New York, New York

June 26, 2008

HOLLAND & KNIGHT LLP

Michael J. Frevola^

195 Broadway

New York, New York 10007-3189

Tel: (212)513-3200

Fax: (212)385-9010

Attorneys for Plaintiff

Wilhelmsen Premier Marine Fuels AS

#5434845 vl

Case 1:07-cv-05798-CM-HBP Document 48 Filed 06/27/2008 Page 8 of 8