1 17-339-cv Amusement Indus., Inc. v. Stern UNITED STATES COURT OF APPEALS FOR THE SECO ND CIRCUIT SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DA TABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL. At a stated term of the United States Cour t of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courth ouse, 40 Foley Square, in the City of New York, on the 5 th day of January, two thousand eighteen. PRESENT: REENA RAGGI, DEBRA ANN LIVINGSTON, RAYMOND J. LOHIER, JR., Circuit Judges

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---------------------------- ---------------------------- --------------- AMUSEMENT INDUSTRY, INC., a California corporation, d/b/a Westla nd Industries , PRACTICAL FINANCE CO., INC., a California corporation, Plaintiffs-Appellees , v. No. 17-339-cv MOSES STERN, a/k/a Mark Stern, Defendant-Appellant , JOSHUA SAFRIN, an indivi dual, FIRST REPUBLIC GROUP REALTY, LLC, a De laware limited liability company, EPHRAIM FRENKEL, an individual, LAND ASSOCIATES ESCROW, a Ne w York limited liability company, LAND TITLE ASSOCIATES ESCROW, AVERY EGERT, FIRST REPUBLIC GROUP CORP., LAND TITLE ASSOCIATES AGENCY, LLC, a/k/a Land Title Associates, Defendants ,2 STEPHEN FRIEDMAN, STEVEN ALEVY, BUCHANAN INGERSOLL & ROONEY P.C., BANKERS CAPITAL REALTY ADVISORS LLC, HERRICK, FEINSTEIN, LLP, ALLEN ALEVY, ALLEN P. SRAGOW, ROBERT FRIEDMAN, Third-Party Defendants.

---------------------------- ---------------------------- --------------- FOR APPELLANT: Brian K. Condon, Condon & Asso ciates, PLLC, Nanuet, New York. FOR APPELLEES: John Hofsaess, Westland Real Estate Group, Long Beach, California. Appeal from a judgment of the United St ates District Court for the Southern District of New York (Lewis A. Kaplan, Judge ; Gabriel W. Gorenstein, Magistrate Judge ). UPON DUE CONSIDERATION, IT IS HEREBY ORDERE D, ADJUDGED, AND DECREED that the amended judgment ente red on January 6, 2017, is AFFIRMED. Defendant Moses Stern appeals from an aw ard of summary judgment in favor of plaintiffs Amusement Industry, Inc. d/b/a We stland Industries and Practical Finance Co., Inc. (collectively, “Amusement”) on their stat e-law claims of fraud, conversion, unjust enrichment, and conspiracy arising from a real estate transaction in which Stern obtained $13 million from Amusement in connection with the purchase of a portfolio of retail shopping centers. We review an award of summary judgment de novo , construing the evidence in the light most fa vorable to the non-moving pa rty and drawing all reasonable inferences and resolving all ambi guities in that party’s favor. See Townsend v. Benjamin Enters., Inc. , 679 F.3d 41, 47 (2d Cir. 2012). We “may affirm on any basis for which there is sufficient suppor t in the record.” Bruh v. Bessemer Venture Partners III L.P. ,3 464 F.3d 202, 205 (2d Cir. 2006 ). In applying these princi ples here, we assume the parties’ familiarity with the fa cts and procedural history of this case, which we reference only as necessary to explain our decision to affirm. Stern challenges the district court’s draw ing of adverse infere nces from deposition invocations of the Fifth Amendment privilege by Stern and third-pa rty defendant Stephen Friedman. Stern failed to ra ise this argument as to his own invocation in objecting to Magistrate Judge Gorenstein’s Augus t 11, 2016 report and recommendation. See Cephas v. Nash , 328 F.3d 98, 107 (2d Cir. 20 03) (stating general rule th at failure to object to purported error in magistrate judge’s report waives further judicial review of point). Even were we to excuse such waiver, see id. , however, Stern’s invocation challenges do

not warrant vacatur. While adverse inferences cannot be draw n against a non-moving party at summary judgment based on an invocation of the Fifth Amendment privilege, see In re 650 Fifth Ave. & Related Props. , 830 F.3d 66, 93 n.25 (2d Cir. 2 016), “invocation of the Fifth Amendment is not a substitute for relevant evidence” and does not free a litigant “from adducing proof in support of a burden which would ot herwise have been his,” United States v. Certain Real Prop. & Premises Known as 4003-4005 5th Ave., Brooklyn, N.Y. , 55 F.3d 78, 83 (2d Cir. 1995) (i nternal quotation marks omitted). Thus, this court has affirmed an award of summary judgment despite the distri ct court’s assumption that adverse inferences could be drawn from de position invocations of the Fifth Amendment because “the lack of testimony from those witnesses meant that there was no record4 evidence to dispute the overwhelming evid ence” proffered by the moving party. In re 650 Fifth Ave. & Related Props ., 830 F.3d at 93 n.25. Th at is this case. Our independent review of the record re veals that, for substa ntially the reasons stated by the magistrate judge in his re port and recommendation and adopted by the district court, Amusement proffered sufficient evidence to establish the elements of its claims, with Stern adducing no admissible ev idence creating any triable issue of fact. See Amusement Indus., Inc. v. Stern , No. 07 Civ. 11586 (LAK) (GWG), 2016 WL 4249965,
at *8

– 15 (S.D.N.Y. Aug. 11, 2016), adopted by 2016 WL 6820744 (S .D.N.Y. Nov. 10, 2016). We further note that the district court concluded that evidence showing Amusement’s reliance on Stern’s misrepresenta tions “alone [was] sufficient” to support its summary judgment award, that such ev idence was merely “buttressed by Stern’s invocation of the Fifth Amendment,” and th at Friedman’s invocation of the Fifth Amendment was no more than “icing on the cake.” Amusement Indus., Inc. v. Stern , No. 07 Civ. 11586 (LAK) (GWG), 2016 WL 6820744, at *2 (S .D.N.Y. Nov. 10, 2016). Thus, to the extent Stern argues the distri ct court granted summary judgment “solely based upon” adverse inferences drawn from the Fifth Amendment invocations, Appellant’s Br. at 17, he mischaracter izes the district court’s decision. In urging otherwise, Stern points to a 2009 bankruptcy decision denying Amusement a preliminary injunction preventi ng First Republic Gr oup Realty, LLC from utilizing disputed funds. See Amusement Indus., Inc. v. Citigroup Global Mkts. Realty Corp. (In re First Repub lic Grp. Realty, LLC) , 421 B.R. 659 (Bankr. S.D.N.Y. 2009). He argues that the decision “paint[s ] a much different picture” of the facts in this case,5 Appellant’s Br. at 4, and, in particular, sh eds light on the relationships among the various parties involved in the real es tate transaction. The argument fails because Stern offers no explanation as to how the bankruptcy court’ s preliminary factual findings, made years earlier and on a different record, here raise genuine issues of material fact. He does not argue, nor could he, that the requirements of issue preclusion are met as to any disputed issue. See Proctor v. LeClaire , 715 F.3d 402, 414 (2d Cir. 201 3). Nor does Stern dispute that he subsequently pleaded guilty to ha ving committed perjury in the bankruptcy proceedings. Insofar as Stern relies on the bankruptcy court decision to argue that Amusement’s witnesses are generally not credible, such conc lusory attacks are insufficient to defeat summary judgment. See Island Software & Computer Serv., Inc. v. Microsoft Corp. , 413 F.3d 257, 261 (2d Cir. 2005) (recognizing that “[b]road, conclusory attacks on the credibility of a witness will not, by themselv es, present questions of material fact”). 1 Stern further argues that plaintiffs cannot prove his “intent to defraud
Amusement ,” Appellant’s Br. at 18 (emphasis in original), by rely ing on statements “made to third-parties” and “not direc tly to” plaintiffs, Reply Br. at 9 (citing Pasternack v. Lab. Corp. of Am. Holdings , 27 N.Y.3d 817, 37 N.Y.S.3d 750 (2016)). While Pasternack holds that the reliance element of a fra ud claim cannot be proved by reference

1 The same conclusion obtains with regard to Stern’s contention that the other opinion he submitted to the district court—an unpub lished 2007 California state court decision affirming a judgment against Amusement aris ing out of an unrel ated real estate transaction, see Amusement Indus., Inc. v. Antin , No. B181465, 2007 WL 1241548 (Cal. Ct. App. Apr. 30, 2007)

— shows “[t]his is clearly not the first time” Amusement has “engaged in such a scheme,” Appellant’s Br. at 12

– 13.6 to a defendant’s misreprese ntation to a third party, see 27 N.Y.3d at 828

– 29, 37 N.Y.S.3d at 750, the New York Court of Appeals there explicitly distin guished cases in which “the third party acted as a conduit to relay the false statement to plaintiff, who then relied on the misrepresentation to his detriment,” id. (stating that indirect communication can establish fraud claim, so long as statement wa s made with intent that it be communicated to plaintiff and that plaintiff rely on it). To the extent plaintiffs’ claim is premised on indirect communications, they assert, w ith record support, that Stern made misrepresentations with intent that they be conv eyed to and relied on by Amusement. Accordingly, Pasternack affords Stern no relief fro m the challenged judgment. Stern nevertheless argues that Amusemen t cannot show reasonable reliance because its principal, Allen Alevy, testified at his deposition that he understood Friedman to be Amusement’s attorney, thereby prec luding reasonable belief that Friedman was making representations on behalf of Stern. But Alevy also te stified that he understood Friedman to be acting as Stern’s attorney. Indeed, record eviden ce establishes that Friedman served as Stern’s “general coun[se]l in this transaction” and that Stern held him out as such. App’x 500. Accordingly, the cited Alevy testimony ra ises no genuine issue of material fact as to the reasona bleness of Amusement’s reliance. Finally, Stern’s assertion that plainti ffs have already re covered $26 million from other parties for the injuries at issue is ba sed only on a confiden tial settlement to which Stern lacks access. Because Stern adduces no evidence to support this assertion, it cannot raise a question of fact to defeat summary judgment. See Davis v. New York , 316 F.3d 93, 100 (2d Cir. 2002) (recognizing that “re liance upon conclusory statements or mere7 allegations is not sufficient to defeat a summ ary judgment motion”). Nor does Stern cite any authority supporting his proposition that su ch a recovery creates a genuine dispute of material fact as to causation. 2 In sum, the record demonstrates that Amusement is entitled to summary judgment on its fraud, unjust enrichment, conversion, and conspiracy cl aims. We have considered Stern’s remaining arguments and conclude that they are without merit. Accordingly, the award of summary judgment in favor of plaintiffs is AFFIRMED.
FOR THE COURT: CATHERINE O’HAGA N WOLFE, Clerk of Court

2 Stern also summarily asserts that plaintiffs are not entitled to summary judgment on the conversion claim because “[a]s [Bankruptcy] Judge Glenn found, Am usement ratified the transaction, and proceeded as if it owned the malls” and, thus, “Amusement cannot now claim that Stern is exerci sing unauthorized dominion or control over its property.” Appellant’s Br. at 20. We have determined that findings of the bankruptcy court do not here establish triable issues of fact, and Ster n points to no record ev idence in support of this contention.