Court Opinion

ID: 4163857
Source: CourtListenerOpinion
Date Created: 2017-04-27 14:12:50.020377+00
Date Added: 2024-06-11T14:37:57.193741
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
               APPROVAL OF THE APPELLATE DIVISION

                                     SUPERIOR COURT OF NEW JERSEY
                                     APPELLATE DIVISION
                                     DOCKET NO. A-0963-12T1

FAIRFAX FINANCIAL HOLDINGS
LIMITED and CRUM & FORSTER
HOLDINGS CORP.,                          APPROVED FOR PUBLICATION

          Plaintiffs-Appellants/              April 27, 2017
          Cross-Respondents,               APPELLATE DIVISION

    v.

S.A.C. CAPITAL MANAGEMENT, L.L.C.,
S.A.C. CAPITAL ADVISORS, L.L.C.,
S.A.C. CAPITAL ASSOCIATES, L.L.C.,
SIGMA CAPITAL MANAGEMENT, L.L.C.,
STEVEN A. COHEN, ROCKER PARTNERS,
L.P., COPPER RIVER PARTNERS, L.P.,
DAVID ROCKER, THIRD POINT L.L.C.,
DANIEL S. LOEB, JEFFREY PERRY,
INSTITUTIONAL CREDIT PARTNERS, L.L.C.,
WILLIAM GAHAN,1 JAMES S. CHANOS, and
KYNIKOS ASSOCIATES, L.P.,

          Defendants-Respondents,

    and

EXIS CAPITAL MANAGEMENT, INC.,
EXIS CAPITAL, L.L.C., EXIS
DIFFERENTIAL PARTNERS, L.P., EXIS
INTEGRATED PARTNERS, L.P., ADAM D.
SENDER, ANDREW HELLER, and MORGAN
KEEGAN & COMPANY, INC.,

          Defendants-Respondents/
          Cross-Appellants,

1 Defendants Institutional Credit Partners, L.L.C. and William
Gahan entered into a stipulation of dismissal with plaintiffs
prior to oral argument.
     and

SPYRO CONTOGOURIS, MAX BERNSTEIN,
MI4 INVESTORS, L.L.C., MI4
RECONNAISSANCE, L.L.C., MI4
LIMITED PARTNERSHIP, JOHN D. GWYNN,2
and CHRISTOPHER BRETT LAWLESS,

          Defendants.
______________________________________________

           Argued October 17, 2016 – Decided April 27, 2017

           Before Judges Fisher, Ostrer and Leone.

           On appeal from the Superior Court of New
           Jersey, Law Division, Morris County, Docket
           No. L-2032-06.

           Michael J. Bowe (Kasowitz, Benson, Torres &
           Friedman, L.L.P.) of the New York bar,
           admitted pro hac vice, argued the cause for
           appellants/cross-respondents   (Nagel   Rice,
           L.L.P.   and  Kasowitz,   Benson,  Torres   &
           Friedman, L.L.P., attorneys; Bruce H. Nagel,
           Jay J. Rice, Marc E. Kasowitz of the New
           York bar, admitted pro hac vice, Daniel R.
           Benson of the New York bar, admitted pro hac
           vice, and Mr. Bowe, of counsel and on the
           briefs).

2 Defendant John Gwynn passed away in 2009. He had filed a
counterclaim, which alleged defamation, and the absence of a
disposition of that claim generated inquiries about finality
from this court soon after the appeal was filed. We were advised
that a representative of Gwynn's estate had been substituted in
his place pursuant to Rule 4:34-1, but that the estate had not
appeared in response to the claims asserted against him or to
prosecute his counterclaim. A remand to the trial court resulted
in the filing of a stipulation of dismissal with prejudice of
Gwynn's counterclaim. Gwynn's estate has neither appeared nor
taken any part in this appeal.

                                 2                         A-0963-12T1
Benjamin   P.  McCallen    (Willkie   Farr   &
Gallagher, L.L.P.) of the New York bar,
admitted pro hac vice, argued the cause for
respondents   S.A.C.    Capital    Management,
L.L.C., S.A.C. Capital Advisors, L.L.C.,
S.A.C. Capital Associates, L.L.C., Sigma
Capital Management, L.L.C. and Steven A.
Cohen (Parker Ibrahim & Berg, L.L.C. and Mr.
McCallen, attorneys; Joseph T. Boccassini,
Martin B. Klotz of the New York bar,
admitted pro hac vice, and Scott S. Rose of
the New York bar, admitted pro hac vice, on
the brief).

Mark S. Werbner (Sayles Werbner, P.C.) of
the Texas bar, admitted pro hac vice, argued
the cause for respondents/cross-appellants
Exis Capital Management, Inc., Exis Capital,
L.L.C., Exis Differential Partners, L.P.,
Exis Integrated Partners, L.P., Adam D.
Sender and Andrew Heller (Walder Hayden &
Brogan, P.A., and Mr. Werbner, attorneys;
Richard A. Sayles of the Texas bar, admitted
pro hac vice, Mr. Werbner, Mark D. Strachan
of the Texas bar, admitted pro hac vice, and
Mark Torian, of the Texas bar, admitted pro
hac vice, of counsel; Rebekah R. Conroy and
Joseph A. Hayden, Jr., on the brief).

Gavin J. Rooney argued the cause for
respondents Copper River Partners, L.P.,
Rocker Partners, L.P. and David Rocker
(Lowenstein Sandler, L.L.P., attorneys; Mr.
Rooney, on the brief).

Tibor L. Nagy, Jr., argued the cause for
respondents Third Point L.L.C., Daniel S.
Loeb and Jeffrey Perry (Tompkins, McGuire,
Wachenfeld & Barry, L.L.P. and Matthew S.
Dontzin (Dontzin Nagy & Fleissig, L.L.P.) of
the New York bar, admitted pro hac vice,
attorneys;   Mr.  Dontzin,   Mr.  Nagy,  and
William McGuire, on the brief).

Thomas F. Campion argued the cause for
respondent/cross-appellant Morgan Keegan &

                      3                          A-0963-12T1
            Company, Inc. (Greenberg, Traurig, L.L.P.,
            Drinker Biddle & Reath, L.L.P., and Bruce W.
            Collins   (Carrington,   Coleman,   Sloman   &
            Blumenthal,   L.L.P.)   of   the  Texas   bar,
            admitted pro hac vice, attorneys; Philip R.
            Sellinger,   Roger   B.   Kaplan,  Aaron   Van
            Nostrand, Mr. Collins, Diane M. Sumoski of
            the Texas bar, admitted pro hac vice, Todd
            A. Murray of the Texas bar, admitted pro hac
            vice and Bryan A. Erman, of the Texas bar,
            admitted pro hac vice, on the briefs).

            Stewart D. Aaron (Arnold & Porter, L.L.P.)
            of the New York bar, admitted pro hac vice,
            argued the cause for respondents Kynikos
            Associates,   L.P.   and  James   S.   Chanos
            (Gibbons, P.C., and Mr. Aaron, attorneys;
            Mr. Aaron, Susan L. Shin of the New York
            bar, admitted pro hac vice, Joel D. Rohlf of
            the New York bar, admitted pro hac vice, and
            Marco J. Martemucci of the New York bar,
            admitted pro hac vice, of counsel; Brian J.
            McMahon and Joshua R. Elias, on the brief).

      The opinion of the court was delivered by

FISHER, P.J.A.D.

      In   describing   the   adjudication   of    ostensibly     difficult

cases, Justice Holmes observed that "when you walk up to the

lion and lay hold the hide comes off and the same old donkey of

a question of law is underneath."3 This case's leonine demeanor

is   well-deserved.     Discovery   generated     millions   of   pages   of

documents, the parties conducted more than 150 depositions, the

3 Letter of December 11, 1909 appearing in 1 Holmes-Pollock
Letters: The Correspondence of Mr. Justice Holmes and Sir
Frederick Pollock 1874-1932, at 156 (Mark DeWolfe Howe ed.,
1941).

                                     4                             A-0963-12T1
joint    appendix    consists   of     nearly   200,000    pages,   and       the

parties' excellent written submissions — succinct though they

are – total nearly 600 pages.4 Nevertheless, as predicted by

Holmes, after grappling with this lion's fearsome hide, we have

found not unfamiliar issues lurking beneath. The sheer size of

this case and the number of issues, however, has frustrated the

normal desire to succinctly describe the implements of decision

and,    in   the   final   analysis,   overwhelmed   our    preference        for

brevity. Consequently, we take the unusual step of presenting,

for the reader's ease, the following table of contents for this

overlength opinion:

                             TABLE OF CONTENTS

I. INTRODUCTION………………………………………………………………………………………………………              8

II. PLAINTIFFS' STORY ……………………………………………………………………………………              9

       A. The Plot Alleged ……………………………………………………………………………            10

       B. The Suit At Hand ……………………………………………………………………………            21

III. A BRIEF HISTORY OF THE PROCEEDINGS ……………………………………              22

IV. THE ISSUES POSED ………………………………………………………………………………………              25

       A. The Viability of the
            Racketeering Claims ………………………………………………………………            26

             1. Plaintiffs' Arguments …………………………………………………           26

4 So numerous were the filings in the trial court that the clerk
was required to assign a second docket number because the
court's database was unable to accommodate more than 999 filings
within a single docket number.

                                       5                                A-0963-12T1
    2. The Judge's Decision ……………………………………………………    29

    3. Our Holding ……………………………………………………………………………    34

         (a) Some General Principles ……………………………    35

         (b) Ginsberg's Impact ……………………………………………    36

         (c) New Jersey's
         Racketeering Laws ………………………………………………………    40

         (d) New York's
         Racketeering Laws ………………………………………………………    46

         (e) The Choice ………………………………………………………………    48

              (i) Legislative Directive   …………………   50

                   a. Is There an Express
                        Directive? …………………………………    50

                   b. Is There an Implied
                        Directive? …………………………………    52

              (ii) Application of the
              Second Restatement ………………………………………    56

                   a. Section 6 …………………………………………    56

                   b. Section 145 ……………………………………    61

                   c. Specific Tort
                        Principles …………………………………    64

              (iii) Conclusion ……………………………………………    72

B. The Maintainability of the
     Common Law Claims ……………………………………………………………………   73

    1. The Statute of Limitations
         Applicable to Plaintiffs'
         Disparagement Claim ………………………………………………     73

    2. Dismissal of Plaintiffs'
         Disparagement and Tortious

                          6                          A-0963-12T1
         Interference With Prospective
         Economic Advantage Claims Based
         on the Absence of
         Special Damages ……………………………………………………………    82

         (a) Choice of Law ………………………………………………………    82

         (b) Common Law Requirements ……………………………    83

              (i) Disparagement …………………………………………    83

              (ii) Tortious Interference
                   With Prospective
                   Economic Advantage …………………………    85

         (c) Damages Asserted ………………………………………………    86

    3. Summary ………………………………………………………………………………………    88

C. The Personal Jurisdiction Rulings ………………………………   89

    1. General Jurisdiction   …………………………………………………   91

         (a) Kynikos ………………………………………………………………………    91

         (b) Third Point ……………………………………………………………    92

    2. Specific Jurisdiction …………………………………………………    95

    3. Conspiracy-Based Jurisdiction ……………………………    96

    4. Summary ………………………………………………………………………………………    112

D. The Summary Judgments In Favor of
  the SAC Defendants and the
  Rocker Defendants ……………………………………………………………………………   113

    1. The SAC Defendants …………………………………………………………    113

         (a) The Parties' Arguments ………………………………    113

         (b) The Trial Judge's Ruling …………………………    115

         (c) Our Holding ……………………………………………………………    117

    2. The Rocker Defendants …………………………………………………    123

                          7                          A-0963-12T1
                (a) The Parties' Arguments ………………………………     123

                (b) The Trial Judge's Ruling …………………………     125

                (c) Our Holding ……………………………………………………………     128

      E. Lost Profits and the Elson Reports ……………………………     129

          1. General Principles …………………………………………………………      132

          2. The Judge's Disposition of
               the In Limine Motion
               Regarding Elson's
               Expert Testimony …………………………………………………………      133

          3. Our Ruling ………………………………………………………………………………      136

V. THE CROSS-APPEALS ………………………………………………………………………………………      141

      A. Standing …………………………………………………………………………………………………     141

      B. First Amendment Grounds …………………………………………………………     145

          1. The Parties' Arguments ………………………………………………      145

          2. The Trial Judge's Decision ……………………………………      147

          3. Our Holding ……………………………………………………………………………      149

V. CONCLUSION …………………………………………………………………………………………………………      155

APPENDIX ………………………………………………………………………………………………………………………      A-1

                                  I

                            INTRODUCTION

      In this complex litigation, which was summarily dismissed

in many stages over the course of six years, the Canadian and

New   Jersey   plaintiffs   asserted,   among   other   things,   that

defendants – most of whom were located in New York – engaged in

                                  8                          A-0963-12T1
a   racketeering     enterprise       that    caused   plaintiffs      billions   of

dollars in damages. That claim required a careful consideration

of choice-of-law principles because New Jersey recognizes that a

plaintiff may maintain a private civil RICO cause of action and

New York doesn't. We agree the trial court correctly chose and

applied New York law in dismissing the RICO claim. We reject,

however, the trial court's determination that plaintiffs' common

law causes of action were governed by a New York statute of

limitations and hold instead that our own statute of limitations

applies; any past uncertainty about that evaporated with the

illumination provided by our Supreme Court's recent decision in

McCarrell v. Hoffmann-La Roche, Inc., 227 N.J. 569 (2017). We

also conclude that New York substantive law applies and limits –

but   does   not    eliminate     –    plaintiffs'     common    law    causes    of

action. Consequently, we affirm in part, reverse in part, and

remand for further proceedings.

                                         II

                              PLAINTIFFS' STORY

      Because      our   Brill5   standard      governed   the   trial     court's

disposition of the many issues presented, as it also guides our

review, Townsend v. Pierre, 221 N.J. 36, 59 (2015), we examine

5 Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540
(1995).

                                         9                                 A-0963-12T1
the disposition of plaintiffs' claims by assuming the truth of

their allegations and by giving plaintiffs the benefit of all

reasonable   inferences.   Consequently,   our   description   of    the

occurrences that triggered this suit are based on plaintiffs'

allegations and should not be construed as our acceptance of

their truth; in short, we only assume their truth. "I cannot

tell how the truth may be; I say the tale as 't was said to me."

Sir Walter Scott, The Lay of the Last Minstrel, canto II, st. 22

(1805).

                       A. The Plot Alleged

    We are told plaintiff Fairfax Financial Holdings Limited

(Fairfax) is a Canadian insurance holding company located in

Toronto, and Crum & Forster Holdings Corp. (C&F) is a New Jersey

corporation headquartered in Morristown. In 1998, Fairfax sought

to rescue C&F from failure by purchasing it for hundreds of

millions of dollars. C&F's turnaround, however, took longer and

proved more difficult than Fairfax originally anticipated. Chief

among its difficulties was what plaintiffs have claimed is a

"racketeering scheme" designed to "kill" them both.

    Plaintiffs assert they were the victims of a "bear raid,"

by which short-sellers borrow securities, sell them, and then

drive the price of that stock down through lies and other forms

of market manipulation. See, e.g., Robert G. DeLaMater, Target

                                 10                            A-0963-12T1
Defensive Tactics As Manipulative Under Section 14(e), 84 Colum.

L. Rev. 228, 244 n.114 (1984). The short-seller then repurchases

the shares at the lower price – or not at all if the prey

becomes bankrupt and its shares are rendered worthless – and

profits from the difference between the higher price at which it

sold the borrowed shares and the lower price it pays for the

shares it returns to the lender. Because short-selling has its

risks – the short-seller must pay interest and post collateral

on the borrowed shares that may prove costly – a "short squeeze"6

quickly causes an increase in the losses suffered.

      Plaintiffs     claim     the    short-sellers       here   were    shorted   so

heavily that the way to a profit and the avoidance of massive

losses    required      that   they   cause     Fairfax    to    fail.   Plaintiffs

quote the statements of various defendants that they intended to

"kill    this   company,"      "crush    this     company,"      "drive    a   stake

through that pig Fairfax's heart," and "tak[e] this baby down

for     the   count."    Plaintiffs      also    quote     various       defendants'

statements that the alleged plan involved "get[ting] them where

they eat, like the credit [analysts] and [stock] holders" and

"stop [their] being able to write biz"; in short, they claim the

short-sellers were intent on inflicting "death by a thousand

6 The profitability of a short position fluctuates with changes
in the values of the borrowed shares. A sudden increase in the
cost of borrowing shares is known as a "short squeeze."

                                         11                                 A-0963-12T1
knives"     by        getting       Fairfax's        subsidiaries     "downgraded"           and

having    C&F     go     into       "runoff,"    causing       a   loss    of    rating      and

rendering the company "pretty much worthless."

       Plaintiffs claim that, so motivated, defendants engaged in

a RICO enterprise. See Boyle v. United States, 556 U.S. 938,

948, 129 S. Ct. 2237, 2245, 173 L. Ed. 2d 1265, 1277 (2009)

(defining        such        an     enterprise       as   "a   continuing         unit    that

functions        with     a       common   purpose"       that     "need        not   have     a

hierarchical          structure       or   a   'chain     of   command'").        Plaintiffs

allege    that         all        defendants     were     associated       in     this    RICO

enterprise, and they described in detail the involvement of the

dramatis personae, which we summarize in the following brief

way:

                      defendant Morgan Keegan & Company,
                       Inc., a registered broker-dealer that
                       provides investment services to hedge
                       funds and others; defendant John Gwynn
                       was a Morgan Keegan analyst. According
                       to plaintiffs, Morgan Keegan dissemin-
                       ated more than sixty materially false
                       and misleading research reports on
                       Fairfax and C&F that were authored by
                       Gwynn, and Morgan Keegan and Gwynn also
                       uttered numerous disparaging communica-
                       tions;

                      defendant S.A.C. Capital Management,
                       L.L.C.,    S.A.C.   Capital   Advisors,
                       L.L.C.,   S.A.C.   Capital  Associates,
                       L.L.C., and Sigma Capital Management,
                       L.L.C., are alleged to be hedge funds
                       controlled by defendant Steven A. Cohen
                       (collectively "the SAC defendants");

                                                12                                    A-0963-12T1
                according   to   plaintiffs,   the   SAC
                defendants   engaged   defendant   Spyro
                Contogouris on a similar past bear raid
                of a different company and, according
                to plaintiffs, similarly engaged him to
                do the same with plaintiffs. The SAC
                defendants were the largest investors
                in the Exis defendants7 and non-party
                Bridger Capital Management, which both
                possessed an economic interest in the
                alleged scheme.

               Contogouris was, according to plain-
                tiffs, an enterprise operative who
                posed   as   an   independent   research
                analyst and disseminated disinforma-
                tion,   instigated    a   Securities   &
                Exchange Commission investigation, and
                generated negative news stories about
                plaintiffs8 via the so-called "MI4"
                reports.9

               The Exis defendants were alleged to be
                hedge funds that secured a substantial
                short position in Fairfax. They and
                their   chief   executive   and   chief
                operating officers, defendants Adam D.
                Sender and Andrew Heller, respectively,
                were alleged to have maintained the
                closest relationship with Contogouris;
                they allegedly provided him with office

7 Namely, Exis Capital Management, Inc., Exis Capital, L.L.C.,
Exis Differential Partners, L.P., and Exis Integrated Partners,
L.P.

8 Adding to the drama, plaintiffs allege Contogouris acted
through the use of aliases, such as "Monsieur Skaramanga," a
James Bond villain.

9 The names of these reports refer to defendants MI4 Limited
Partnership, MI4 Reconnaissance L.L.C., and MI4 Investors,
L.L.C. (the MI4 defendants), all entities controlled by
Contogouris.

                                13                         A-0963-12T1
    space, assistants and a most       sub-
    stantial compensation package.

   defendants Rocker Partners, L.P., and
    Copper   River    Partners,  L.P.,   are
    alleged to be hedge funds based in
    Millburn primarily owned and managed by
    defendant David Rocker (collectively,
    the Rocker defendants); according to
    plaintiffs,    the    Rocker  defendants
    worked closely with defendant Kynikos
    Associates, L.P., Morgan Keegan and
    other members of the alleged enterprise
    in shorting Fairfax at the scheme's
    inception.

   defendant Institutional Credit Part-
    ners, L.L.C. (ICP) is a financial firm
    alleged to have paid and worked closely
    with Contogouris, and to have traded in
    advance of negative events allegedly
    generated by Contogouris. According to
    plaintiffs, ICP directly disseminated
    false claims about them; ICP employees
    are alleged to have worn surgical
    gloves to avoid leaving fingerprints on
    materials they transmitted, and William
    Gahan, an ICP credit analyst, obtained
    the bail bond that secured Conto-
    gouris's release after he was arrested
    by the Federal Bureau of Investigation
    on an unrelated fraud charge months
    after this suit was filed.

   defendant Kynikos Associates, L.P. – a
    limited partnership organized in 1985
    in Delaware with its principal place of
    business in New York – is an investment
    advisor and management company special-
    izing in short-selling; it has managed
    over   $1  billion   for  its  clients.
    Plaintiffs alleged that Kynikos and its
    founder and president, James S. Chanos,
    participated in the enterprise in that
    they worked closely with other defen-
    dants, including Contogouris.

                    14                         A-0963-12T1
                 defendant Christopher Brett Lawless, a
                  New   Jersey    resident,   worked  as   a
                  research analyst for Fitch Ratings in
                  New York City and for the Center for
                  Financial Research and Analysis in
                  Maryland.    Lawless   allegedly   tutored
                  Contogouris to enable him to pose as a
                  research     analyst     and    thereafter
                  continued to collaborate with Morgan
                  Keegan, Contogouris and those paying
                  Contogouris.

                 defendants Third Point, L.L.C., is an
                  investment   management   firm   created
                  under   the   laws   of   Delaware   and
                  headquartered in New York. During the
                  times in question, Third Point provided
                  management services to several invest-
                  ment funds that traded in Fairfax
                  securities. Defendant Daniel S. Loeb is
                  the founder and managing member of
                  Third Point, and defendant Jeffrey
                  Perry was a senior analyst.

    According      to    plaintiffs,       in   2002,     the   SAC   defendants,

Kynikos, the Rocker defendants, and others, were collaborating

and either aggressively shorting or preparing to short Fairfax.

Plaintiffs   claim      that   C&F   had    begun    to    favorably      turn   its

position around at that time, so defendants' enterprise sought a

"negative    catalyst"       to   drive     down    C&F's       price,    and     the

enterprise   began      to     "educate[]       rating    agencies       and    other

research analysts about their negative views."

    On December 18, 2002, the day after deciding to cover their

position, the SAC defendants learned that Gwynn of Morgan Keegan

was about to issue a report that Fairfax and its subsidiaries

                                       15                                  A-0963-12T1
were    under-reserved    by    billions     of   dollars    and   effectively

insolvent. Gwynn tipped off Kynikos and faxed an outline of the

issues.   Upon   receiving      this   tip,    the   SAC    defendants   began

communicating directly with Gwynn, and Kynikos and Third Point

thereafter traded in advance of the report based on the tipped

information.10

       Morgan Keegan published its report on January 17, 2003.

Plaintiffs    allege     that   Morgan      Keegan   falsely   claimed     that

Fairfax had overstated its equity by more than $5 billion and

that Morgan Keegan's alleged false claim devastated Fairfax's

stock price, which fell thirteen percent in one day and further

in the days that followed. Two weeks later, Morgan Keegan issued

a second report acknowledging it "possibly" double-counted $2

billion in purported subsidiary liabilities, including at C&F.

As a result, the stock price recovered somewhat but remained

down.

10 Plaintiffs claim that Kynikos re-shorted over $5 million in
shares just before the first report. And, after not shorting for
four months, Third Point sold short $1,500,000 in shares the day
before publication. The SAC defendants did not cover its short
positions by year-end as originally planned but completed their
cover after the report was issued and the stock price dropped
sharply.   Plaintiffs assert that many of the trades involving
these and other parties or accounts controlled by the enterprise
members violated insider-trading laws and support their RICO
claim.

                                       16                             A-0963-12T1
      According to plaintiffs, enterprise members traded heavily

on   Morgan      Keegan's    tips    concerning        its     initial    report.    In

exchange, Morgan Keegan benefited from these tips by way of

commissions through referred trades, and with the expectation of

greater future benefits. According to plaintiffs, Morgan Keegan

understood their big payoff – what a Morgan analyist referred to

as "our 7-8 digit trade!!" – would come when Fairfax's "stock

goes to zero." Consequently, for the next four years, Morgan

Keegan published more than sixty research reports that portrayed

plaintiffs    and    their    affiliates        as    "an    insolvent,     Enron-like

fraud[]";     this      disinformation      was,      according      to   plaintiffs,

orchestrated,       and   Morgan     Keegan     was    urged    to   make    sure   its

reports were "really negative." Morgan Keegan communicated in

other ways that Fairfax and its executives were "crook[s]" and

"felons"    who    manipulated       financial       information     to   "mak[e]    it

look like they have a profit." Plaintiffs claim Morgan Keegan

knew of the falsity of its disseminated statements.

      Plaintiffs allege that, despite the inflicted harm, their

turnaround was progressing, causing defendants' enterprise to

either    quit    its     position    at   a    loss    or     increase     the   short

position and intensify their efforts. Information amassed in the

joint appendix evokes scenes from Oliver Stone's 1987 film, Wall

Street.     One hedge fund manager – defendant Adam Sender, who was

                                           17                                 A-0963-12T1
affiliated with the Exis defendants – explained to Contogouris

that he "want[ed] [Prem Watsa's11] head in a box," and another

viewed the dissemination of negative reports as the equivalent

of needing to "keep . . . this gun loaded with bullets" and

"eventually this pig will roll over and die." Meanwhile, to add

content to the negative reports, Morgan Keegan allegedly fed

Contogouris with the false claims that: Fairfax was disguising

billions       in    debt   as     reinsurance;         Fairfax     was     turning      its

investment          subsidiaries        –    with     the   use     of    "[s]moke       and

[m]irrors" – into "an illegal enterprise"; and that Watsa was

"transferring         his   personal          holdings      into    asset     protection

schemes that he thinks will be safe from regulators."

       Over     the     course     of       nearly    two    years,      Contogouris        –

allegedly      at     the   direction        and     with   the    support    of    Morgan

Keegan, Lawless, the Exis defendants, Third Point and Kynikos –

disseminated false claims to the FBI, federal prosecutors, the

SEC,     the    media,      ratings         agencies,       research      analysts       and

investors, that Fairfax was engaged in an Enron-like fraud.12 In

June 2005, the SAC defendants re-shorted Fairfax – a month after

11   Watsa is Fairfax's chairman and chief executive officer.

12   Contogouris   anonymously   created   a    website   called
Premwatsa.com, which compared Fairfax to the disgraced Enron and
Watsa to Enron's CEO, Kenneth Lay. Much has been written about
the Enron debacle. See, e.g., Kurt Eichenwald, Conspiracy of
Fools: A True Story (2005).

                                              18                                   A-0963-12T1
Contogouris's approach to the FBI that resulted in the service

of   SEC   subpoenas   on   Fairfax   in     September   2005.       Three    weeks

earlier, the investors of Exis, of which SAC was the largest,

were tipped off that "subpoenas from the regulators . . . should

be announced in the next three weeks." The Exis defendants and

the SAC defendants increased their short positions in advance of

the subpoenas.

      Plaintiffs    further   allege,      and   refer   to    the    voluminous

record in support, that Contogouris provided false and negative

information    to   various   media    and    targeted    as    part    of    this

campaign: investors, institutions and research analysts; rating

agencies13; Fairfax executives and staff14; and even to Watsa's

parish pastor.15 Contogouris allegedly made harassing telephone

calls to Watsa's home and office at night to "rattle his cage."

Plaintiffs    assert   that    Contogouris       kept    Morgan      Keegan     and

Lawless advised of his activities, and Morgan Keegan reported

these activities to other enterprise members.

13 Contogouris sent his FraudFacts report to Standard & Poor's
and A.M. Best.

14 Plaintiffs allege that Contogouris sent, through the use of
aliases, threatening emails to Watsa's staff in an effort to
find "a way in" via a staff member willing to be a mole.

15 Contogouris allegedly sent information to Watsa's parish
pastor, warning that Watsa, who handled the church's investment
fund, might defraud the church.

                                      19                                 A-0963-12T1
      According     to   plaintiffs,         the    enterprise       members   learned

during the Summer of 2006 that the FBI and federal prosecutors

intended to expand their investigation into Fairfax in light of

Contogouris' disseminations, and they also learned that The New

York Post was about to publish a series of negative stories.

Contogouris    used      code     in   communicating          this   information       to

enterprise members, referring to the FBI as the "meteorologist,"

The   New   York   Post       reporter       as   the   "Postman,"      and    what    he

expected to imminently occur as the "Hurricane," which was due

in August. Sender encouraged others to short the stock and the

SAC defendants, which allegedly were in contact with Sender and

Contogouris "all the time" during this period, increased their

short position in June 2006. To fuel the flames, rumors were

allegedly    spread      on    June    22    and    23,   2006,      that   Watsa     had

transferred his assets into his wife's name and that he fled the

country as the Royal Canadian Mounted Police raided Fairfax's

offices.

      The day after these rumors started, the Exis defendants

rewarded    Morgan       Keegan       with    substantial       trading       business.

Fairfax's   stock     price     plummeted         for   two   days    before    Fairfax

issued a statement debunking the rumors.

                                             20                                A-0963-12T1
                            B. The Suit At Hand

     Plaintiffs commenced this lawsuit on July 26, 2006. Their

complaint was filed just before what they allege were to be the

final   steps   in   the    enterprise's      scheme    but   not    before    they

allegedly    suffered      significant       monetary     damages.    Plaintiffs

claim Fairfax suffered damages to its assets and equity, as well

as those of its subsidiaries, in the billions of dollars.16

     Particularly relevant in light of the issues on appeal,

plaintiffs   claim    C&F    incurred    a    loss   of   nearly     $1   billion,

including: (1) approximately $200,000,000 in capital costs and

interest incurred in and paid from New Jersey in the form of

having to raise capital not otherwise needed; (2) lost profits

estimated at $545,000,000; and (3) increased costs and expenses

in the form of higher directors and officers (D&O) insurance

premiums with far less coverage, and greater legal, accounting,

16 The parties even dispute the purpose of this suit. Morgan
Keegan contends that Fairfax has been a "troubled company for
years," and launched, as part of a "public relations campaign,"
this   "sensational"   RICO  suit,   claiming   $6  billion   in
compensatory damages, which, if trebled as permitted by New
Jersey law, would result in "a headline-grabbing $18 billion,"
caused by "a veritable cabal of short sellers and research
analysts bent on destroying the company" for their own profit.
The matter having come before us by way of summary rulings in
favor of all defendants, we place no reliance on Morgan Keegan's
argument about the motivation of this suit and assume, without
deciding, the bona fides of plaintiffs' claims.

                                        21                                A-0963-12T1
and administrative costs to deal with the enterprise's alleged

wrongful actions.

                                       III

                              A BRIEF HISTORY
                             OF THE PROCEEDINGS

     As mentioned, plaintiffs commenced this action in 2006. A

second amended complaint was filed in 2007 and a third in 2008.

Plaintiffs     alleged     defendants'       manipulations      violated      New

Jersey's    RICO   statute    and    gave    rise   to   several    common    law

claims,     specifically     commercial       or    product    disparagement,

tortious     interference     with     prospective       economic    advantage,

tortious interference with contractual relationships, and civil

conspiracy.

     On July 11, 2008, the Rocker defendants moved for summary

judgment,     asserting     that     insufficient    evidence       existed    to

establish that it participated in the alleged conspiracy. The

judge then presiding over the matter17 granted, on September 25,

2008, the Rocker defendants' application, but did so without

prejudice.

17Numerous judges presided over this leviathan of a case during
its long life in the trial court. To avoid confusion, we make no
attempt to distinguish which of the able judges ruled on which
motion. Regardless of the outcome of the many issues raised, we
commend all these judges for their efforts.

                                       22                               A-0963-12T1
      On May 5, 2011, the SAC defendants sought summary judgment

on   grounds    substantially         similar        to    those     that      the    Rocker

defendants     had    successfully      advanced,          namely,      that      there     was

insufficient     evidence        to    demonstrate           the       SAC     defendants'

participation        in   the   alleged    scheme          against         plaintiffs.       On

September 12, 2011, the court granted the SAC defendants' motion

for summary judgment.

      Meanwhile, Kynikos moved for summary judgment, claiming our

courts could not assert personal jurisdiction over it. Third

Point and ICP also moved for summary judgment on the same or

similar grounds. Kynikos and Third Point also sought a choice-

of-law     determination,       arguing        New        York   law       both      governed

plaintiffs'     conspiracy       claims    and        required         a     dismissal      of

plaintiffs' RICO claims. And, in the same period of time, the

Rocker defendants sought a determination that the September 25,

2008 grant of summary judgment "without prejudice" be converted

to a dismissal "with prejudice."

      On    December      23,   2011,     the        court       granted       the    Rocker

defendants' application to convert its prior determination to

summary judgment with prejudice and dismissed the third amended

complaint    against      Kynikos,     Third     Point       and    ICP      for     lack    of

personal jurisdiction.

      Many more motions followed.

                                          23                                         A-0963-12T1
     On    April     13,    2012,    Morgan    Keegan,      Lawless,    the   Exis

defendants and the MI4 defendants filed a consolidated motion

for summary judgment with respect to all the common law claims

plaintiffs had asserted against them.18 And, on April 20, 2012,

plaintiffs cross-moved for reconsideration of the court's prior

dismissal of the Rocker defendants with prejudice.

     On May 11, 2012, the trial court granted partial summary

judgment in favor of Lawless. Finding New York law governed

plaintiffs' racketeering allegations, the trial court dismissed

plaintiffs' RICO claims. And plaintiffs' reconsideration motion

of the with-prejudice dismissal of the claims against the Rocker

defendants was denied.

     In June 2012, the trial court heard and summarily dismissed

plaintiffs'       claim    of   tortious     interference     with     prospective

economic advantage but sustained plaintiffs' remaining common

law claims.

     Also in June 2012, Morgan Keegan moved for partial summary

judgment, seeking dismissal of plaintiffs' disparagement claim

based on its alleged untimeliness; the motion was denied in

August    2012.    Later    that    month,    the   judge   denied     plaintiffs'

request to reconsider its ruling that New York law controlled

18Namely, tortious interference with contractual relationships,
tortious interference with prospective economic advantage, and
civil conspiracy.

                                        24                                A-0963-12T1
plaintiffs' racketeering and conspiracy claims. The judge also

granted Morgan Keegan's application for reconsideration of the

denial of summary judgment on the tortious-interference-with-

contract claim but rejected Morgan Keegan's assertion that a

one-year        statute    of       limitations         applied      to        plaintiffs'

disparagement claim.

    On         September   5,       2012,     plaintiffs         stipulated       to     the

dismissal of Lawless without prejudice. On September 11, 2012,

in accordance with a partial settlement agreement, the judge

signed     a    consent    order,       which      dismissed      without        prejudice

plaintiffs' claims against Contogouris and the MI4 defendants.

And, on September 12, 2012, the judge entered final judgment

dismissing the entirety of the remainder of plaintiffs' third

amended    complaint,      finding      "a    complete      absence       of    proof"    of

proximately-caused damages.

    Plaintiffs        filed     a    notice       of   appeal.    Cross-appeals        were

also asserted.

                                             IV

                                    THE ISSUES POSED

    In appealing the summary dismissal of its causes of action,

plaintiffs argue the trial court erred: (a) in dismissing their

RICO claims by applying New York rather than New Jersey law; (b)

in dismissing certain of their common law claims by applying New

                                             25                                   A-0963-12T1
York's statute of limitations rather than New Jersey's; (c) in

dismissing the claims against Kynikos, Third Point and the ICP

defendants19 for lack of personal jurisdiction; (d) in granting

summary judgment in favor of both the SAC defendants and the

Rocker defendants; and (e) in excluding the expert opinion of

Craig Elson on damages that plaintiffs intended to elicit at

trial, thereby shutting the door on any trial at all.

                         A. The Viability of
                       The Racketeering Claims

     In reviewing the disposition based on the trial court's

application   of   choice-of-law   principles,     we   describe    (1)   the

parties'   arguments   and   (2)   the   judge's    decision,      and    then

express (3) our agreement with the trial court's disposition of

the RICO claim.

                       1. Plaintiffs' Arguments

     Plaintiffs claim the trial court erred by dismissing their

RICO claims through application of New York law. Indeed, they

argue that choice-of-law questions do not even arise when a

matter falls within the intended scope of a New Jersey statute;

that is, they claim our Legislature intended to provide a remedy

19As noted earlier, plaintiffs and the ICP defendants resolved
their differences shortly before oral argument took place in
this court.

                                   26                               A-0963-12T1
for every New Jersey domiciliary harmed by a RICO violation,

which   the     law       defines    as    harm    arising    from       conduct       of    a

prohibited         kind    that     satisfies     the    enactment's          territorial

predicates,        with    no    distinction      between    criminal         and   private

prosecutions. And they argue there was sufficient conduct by

defendants      that       either    occurred     within     or    had    a    sufficient

effect in New Jersey to satisfy the statute, even apart from the

conspiracy, which by itself – in their view – involved enough

activity   within          New    Jersey   to     satisfy    the     Criminal        Code's

definition of such an offense.

    Plaintiffs argue further that the court had no basis for

"inventing" or "importing" common law principles to impose the

territorial limitations on jurisdiction over traditional torts,

noting that the limitations were not included in either the RICO

statute    or       in     the    Criminal      Code's     general       territoriality

statute.      On     the    contrary,      they    claim     the     Legislature          has

specified that the RICO provisions for civil remedies must be

liberally construed to affect that enactment's remedial purpose

and that all remedies be cumulative to one another and to other

remedies at law.

    In addition, plaintiffs argue that the trial judge erred by

failing to recognize there was no policy conflict between New

Jersey and New York law because both states' enactments "provide

                                             27                                     A-0963-12T1
civil remedies to deter and compensate for" the same proscribed

conduct.      And they argue New Jersey's allowance of private civil

remedies does not constitute a different approach toward the

shared       goal    of     deterring    racketeering,        "only      a     different

judgment about how best to use each state's judicial system to

do    so."    Although       both    states     seek   to    vindicate         the     same

policies, plaintiffs argue New Jersey's broader remedies made it

the better vehicle for achieving that goal, and thus the correct

law to apply.

      Plaintiffs contend further that, even if New Jersey and New

York law generated a true conflict, section 6 of the Restatement

(Second) of Conflict of Laws (1971) (Am. Law Inst., amended

1988),20 provided an independent basis for applying New Jersey

law   to     the    RICO     claims.    They     assert     section      6     warranted

application of New Jersey law due to this State's interest in

protecting      C&F,       which    sustained   injuries      at   its       New     Jersey

headquarters,        and     because     New    Jersey      had    an    interest         in

protecting         other    in-state     businesses,        such   as        the     rating

agencies and business news organizations that the enterprise is

20Our many references to the Restatement (Second) of Conflict of
Laws shall hereafter in the text be "Second Restatement" and in
citations be "Restatement (Second)," with reference to a
specific section or comment. To avoid confusion, we will provide
greater specificity when referring to the Restatements dealing
with torts and contracts that are cited as well.

                                          28                                       A-0963-12T1
alleged to have deliberately misled in order to promote their

scheme.   Plaintiffs    contend      they    reasonably     expected    the

protection of New Jersey law to the extent of their business

affecting this State, whereas defendants had no expectation that

their misconduct would be any less violative of New York law

than it would of New Jersey law.       In addition, they contend that

failing to apply New Jersey's RICO statute as intended would

inject an unanticipated and unneeded balancing test between New

Jersey law and out-of-state law.

     Finally,   plaintiffs   argue    that   the   Second   Restatement's

section 145 standards favored application of New Jersey law due

to the predominance of this case's contacts with New Jersey.

They call New Jersey the situs of "the injury" because C&F had

its domicile and principal place of business here, and they note

that several enterprise members were New Jersey residents or

engaged in enterprise activity within the State.

                       2. The Judge's Decision

     In May 2012, the trial judge determined that New York's

local law – that is, the law that applied within New York before

any consideration of choice-of-law principles21 – applied to the

21 The judge's definition of "the local law" accords with the
Second Restatement, which describes "the local law" as the law
that would apply if all parties and relevant events were within
                                                    (continued)

                                  29                              A-0963-12T1
RICO claims and, accordingly, compelled the entry of summary

judgment in defendants' favor. He first found an actual conflict

existed – because New Jersey recognizes a private civil RICO

action and New York doesn't – and observed that a statutory

mandate for New Jersey jurisdiction over private civil claims

would have precluded a choice-of-law analysis here, but then

found no such mandate existed. The judge explained that RICO's

own territoriality provision was expressly limited to criminal

cases, and that the Legislature did not intend civil RICO claims

to have the same jurisdictional reach or to be exempt from the

"accepted, traditional common law principles of jurisdiction"

for civil claims, which included application of choice-of-law

principles.

    The trial judge recognized that the first step in a choice-

of-law analysis was to determine whether any state was presumed

to satisfy the Second Restatement's most fundamental touchstone

of being the state with "the most significant relationship" to

the matter and found that, though choice-of-law principles might

deem C&F's loss of customers to have been an injury sustained in

(continued)
one state, without application of that state's choice-of-law
rules.   Restatement (Second), supra, § 145 cmt. h and § 4. In
this context, a reference to "state law" without qualification
means the entire body of a state's law, including its choice-of-
law rules. Ibid.

                               30                       A-0963-12T1
New Jersey, it was "improper" to presume New Jersey jurisdiction

on that basis, because C&F was "a minor player in this matter,"

there   was   a   "complex     interrelationship     between      [the]

plaintiffs," and the RICO allegations here were broader and more

complex than a particular injury to one subsidiary.

     According to the trial judge, the "most direct consequence"

of the alleged RICO enterprise was to decrease the market prices

of plaintiffs' securities, a claim for which Fairfax was the

"lead" plaintiff. All the other alleged injuries caused by the

enterprise, namely, the increase in "capital costs," the costs

of responding to the SEC investigation, and the increased legal

and accounting costs, "were a consequence of that deflation."

The "most direct" injury and its derivatives arose from the

alleged enterprise activity that involved the financial markets

and financial news media and, as the judge observed, "[t]he

financial markets, the news media and the parties are clearly

based predominantly in New York." Accordingly, the New Jersey

connections to the RICO claims – namely, the domiciles of C&F,

A.M. Best,22 and Lawless – did not suffice to give New Jersey the

"most significant relationships" to a RICO enterprise as broad

22 A.M. Best is   a major    rating   company   headquartered in     New
Jersey.

                                 31                            A-0963-12T1
and complex as alleged. Consequently, the trial judge found that

New York's local law presumptively applied.

      As for the other section 145 factors, the judge found that

the   "vast      majority"      of    the     alleged      misconduct      manifestly

occurred   in     New   York    and   only       a   fraction    was     committed      by

Lawless, the one defendant located in New Jersey. The judge

determined that all other enterprise members were domiciled or

incorporated elsewhere and conducted their activities elsewhere,

and, also, that the enterprise members did not have a prior

relationship, much less one centered in New Jersey. Furthermore,

Fairfax    and    its   other    main       United      States   operating       Odyssey

subsidiaries,23       were   domiciled       or      incorporated      elsewhere       and

operated outside New Jersey. Accordingly, even if the decrease

in the price of C&F securities was deemed a direct injury to

C&F, as opposed to a derivative injury largely arising from its

exposure   to     Fairfax's     troubles,        "the    place   where     the    injury

occurred,"       as   defined    by     section       145(2)(a)     of    the     Second

Restatement, was nonetheless in New York's financial markets,

and the enterprise members had "minimal contact with New Jersey"

in causing it.

23 What we refer to as Odyssey consists of: Odyssey Re Holding
Corp., which was incorporated in Delaware and had principal
executive offices in New York; wholly-owned Odyssey Re Group;
and Odyssey America Reinsurance Corp., which had its principal
offices in Connecticut.

                                            32                                   A-0963-12T1
      The trial judge then turned to the general choice-of-law

principles set out in section 6 of the Second Restatement. For

comity's sake, he explained that, although New York and New

Jersey     had    competing    interests         about   whether      private     actors

should     be    able   to   enforce    a     RICO   statute,        the   two   states'

enactments were nonetheless similar and shared the "fundamental

policies" of preventing racketeering and other organized crime.

The   two   states'      policies      were      therefore     not    in   fundamental

conflict, so interstate comity required New Jersey to respect

New York's deliberate decision about how to serve that policy

that included a decision to withhold a private RICO cause of

action. The judge found that was also true from the perspective

of "[t]hose involved in the financial markets based in New York"

because they "should be able to depend on New York law" as the

law governing "their conduct."

      As    for   the   interests      of     the    parties    and    the   interests

underlying the field of tort law, the judge observed that the

parties knew New York law precluded exposure to private RICO

claims regardless of their conduct. And, because New York had

the "most significant relationship" to the matter, defendants

had "no reasonable expectation" that such exposure could arise

due to the application of another state's local law. The judge

reasoned the result should not change just because the conduct,

                                            33                                   A-0963-12T1
which was focused on "the New York financial industry," also had

tangential     connections         outside       that       state,      such        as    the

communications       with   A.M.      Best,     the       one   major    rating      agency

located in New Jersey.

      The trial judge also observed that the only factor favoring

application of New Jersey law instead of New York law was the

greater involvement in this litigation of New Jersey's courts.

He noted, however, that this factor did not outweigh the need to

serve   the    choice-of-law           "values,"          which    were      "certainty,

predictability and uniformity of results" in their application.

Consequently, the judge ruled that the "qualitative balance" of

all   the   section     145    and      section       6    factors      of    the    Second

Restatement compelled application of New York local law, which,

upon application, compelled dismissal of the RICO claims.

                                  3. Our Holding

      For the reasons that follow, we conclude that New York law,

which   does   not    permit      a    private    civil         racketeering        action,

applies in this case and, as held by the trial court, requires

the dismissal of plaintiffs' RICO claim.

      We first consider (a) some general principles, as well as

(b)   the   impact     of   the       Supreme    Court's        recent       decision      in

Ginsberg v. Quest Diagnostics, Inc., 227 N.J. 7, 18 (2016), on

the issues raised. Then, because an early but pivotal step in

                                          34                                        A-0963-12T1
resolving a choice-of-law problem requires a determination that

a true conflict exists, we examine (c) New Jersey's racketeering

laws, and their intent and purposes, and we thereafter similarly

analyze (d) New York's racketeering laws. We then conclude this

part of the opinion with a description of (e) the choice of law

required in these circumstances.

                         (a) Some General Principles

       In    considering       the   propriety        of     the   choice-of-law

determinations in question, we observe, first, that the trial

judge's interpretation of the RICO statutes is not entitled to

deference. ADS Assocs. Grp., Inc. v. Oritani Sav. Bank, 219 N.J.
496,   511     (2014).    Choice-of-law     determinations         present   legal

questions,     which     are   subjected    to   de   novo    review.    Bondi    v.

Citigroup, Inc., 423 N.J. Super. 377, 418 (App. Div. 2011),

certif. denied, 210 N.J. 478 (2012); Arias v. Figueroa, 395 N.J.

Super.      623,   627   (App.   Div.),    certif.     denied,     193 N.J. 223

(2007). And choice-of-law decisions are made not only issue-by-

issue, Cornett v. Johnson & Johnson, 211 N.J. 362, 374 (2012),

but also, at times, party-by-party, Ginsberg, supra, 227 N.J. at

18.

       When New Jersey is the forum state, its choice-of-law rules

control. McCarrell, supra, 227 N.J. at 588; Erny v. Estate of

Merola, 171 N.J. 86, 94 (2002). For tort claims, our Supreme

                                       35                                 A-0963-12T1
Court has expressly embraced the Second Restatement for choice-

of-law determinations. P.V. ex rel. T.V. v. Camp Jaycee, 197
N.J. 132, 139-43 (2008).

     New   Jersey    courts    have    also   recognized   that   a     parent

corporation may have standing to participate in litigation over

wrongs sustained by its subsidiary if the parent itself has a

sufficient financial interest in the outcome. See, e.g., Bondi,

supra, 423 N.J. Super. at 436-39. See also Section V(A), infra.

Bondi   did    not   declare   a      categorical   rule   that   the     same

jurisdiction's local law always applies to both the parent and

the subsidiary with regard to a particular claim, and, at the

time the trial judge ruled, neither Bondi nor any other reported

New Jersey opinion had suggested a general reason not to adopt

such a rule.

                         (b) Ginsberg's Impact

     Recently, our Supreme Court recognized that, in multi-party

actions, choice-of-law principles may call for the application

of a different state's laws from party-to-party or claim-to-

claim. Ginsberg, supra, 227 N.J. at 18.24 But plaintiffs have

24 To be precise, Ginsberg specifically held that "in the
majority of cases, a defendant-by-defendant analysis furthers
the [Second] Restatement principles and provides the most
equitable method of resolving choice-of-law questions." 227 N.J.
at 18 (emphasis added). But, in explaining this aspect of its
                                                     (continued)

                                       36                             A-0963-12T1
never   sought       separate       choice-of-law        analyses.        In      fact,

plaintiffs have blurred the distinctions between them and their

subsidiaries,        perhaps       for      strategic        reasons,25        thereby

frustrating       any         attempt      at     rendering        an     informed,

individualized,      choice-of-law         analysis     from    each    plaintiff's

standpoint.

     That   is,   we     recognize       that    in   many   instances      in    which

multiple    claims      are    asserted    by    multiple      plaintiffs      against

multiple defendants, a court may be asked to make individualized

choice-of-law     determinations          that   "exponentially"        increase      in

difficulty with every increase in the number of parties and

claims. See Georgine v. Amchem Products, Inc., 83 F.3d 610, 627

(3d Cir. 1996). We do not think, however, that where two or more

related corporate plaintiffs file a single action based on the

(continued)
holding, the Court observed that Second Restatement principles
"focus[] on the state's relationship to the parties," and
recognized   that,  in  referring   to  "parties,"   the  Second
Restatement was not limited and included plaintiffs, defendants,
and "any third party defendants." Ibid. (emphasis added).
Consequently, we do not view Ginsberg's particular holding,
which required in some instances a "defendant-by-defendant
analysis," as applying only in that circumstance. Instead, the
same principles may at times warrant plaintiff-by-plaintiff
analyses as well.

25 For example, if it had pursued its claims separately from
C&F's, Fairfax would have had no plausible argument for applying
New Jersey substantive law to a dispute between a Canadian
corporation based in Toronto and various New York-based
defendants.

                                          37                                   A-0963-12T1
same operative set of facts, and assert causes of action and

demands for damages allegedly caused to their corporate family –

as if that family constituted a single entity – that a court

must   nevertheless    disentangle      all    the      possibilities     in

identifying   the   correct   state    law    to   be   applied   to    each

plaintiff's claim or claims. Ginsberg does not require that a

court make such determinations when the court is deprived of the

parties' assistance. In short, since plaintiffs do not seek a

separate resolution of each choice-of-law problem from each of

their standpoints, we will not pursue that possibility further.

We would add that to the extent multiple plaintiffs would have a

court treat them differently for choice-of-law purposes, they

must come forward and make that argument26 and, moreover, be

26 We do not interpret our rules as requiring a plaintiff or
plaintiffs to affirmatively plead the application of another
jurisdiction's laws; indeed, we have shown particular liberality
in allowing defendants to assert another jurisdiction's laws in
moving for summary judgment even when not having first asserted
that other jurisdiction's law as an affirmative defense. See
Rowe v. Hoffman-La Roche Inc., 383 N.J. Super. 442, 450-51 (App.
Div. 2006), rev’d on other grounds, 189 N.J. 615 (2007); Erny v.
Russo, 333 N.J. Super. 88, 96 (App. Div. 2000), rev’d on other
grounds, 171 N.J. 86 (2002). But that liberality is stretched
beyond breaking if we were to allow a party to advocate on
appeal, for the first time, an entirely different approach to
already difficult choice-of-law questions. As we said in our
decision in Ginsberg, which the Supreme Court affirmed, "choice-
of-law determination[s] ideally should be made as early in a
case as possible." Ginsberg v. Quest Diagnostics, Inc., 441 N.J.
Super. 198, 223 (App. Div. 2015); see also Bailey v. Wyeth,
Inc., 422 N.J. Super. 343, 350 (Law Div. 2008), aff’d on other
                                                     (continued)

                                  38                              A-0963-12T1
willing     to    be   treated   separately   for    all   other    purposes     as

well.27

       In   the   final   analysis,    Ginsberg     not    only    held   that   an

individualized assessment is "not feasible in every matter," 227
N.J. at 20, but also that, in each case, a court must ascertain

"the      most     equitable     method     of      resolving      choice-of-law

questions," Id. at 18.           A sudden alteration in course – sought

by no one here, even now on appeal – that might arguably be

(continued)
grounds, 433 N.J. Super. 360 (App. Div. 2011), certif. denied,
211 N.J. 274 (2012). And it is well-established in the federal
courts that choice-of-law issues may be waived when not asserted
by the parties, Williams v. BASF Catalysts LLC, 765 F.3d 306,
316-17 (3d Cir. 2014), a concept that we hold should be applied
here as well. Having said all that, we do not mean to suggest
that plaintiffs have sought a sudden change in course; to the
contrary, even after both our decision and the Supreme Court's
decision in Ginsberg, plaintiffs have continued to pursue their
rights as if they were the same juridical creature and have not
sought an individualized choice-of-law assessment from each
plaintiff's standpoint. Consequently, we hold that in light of
the arguments plaintiffs have posed, and in consideration of
their suggestions as to how we are to exit this choice-of-law
labyrinth, we should not now pursue a wholly different path that
plaintiffs – even in the wake of Ginsberg – have never urged as
the proper or required course.

27 When multiple plaintiffs seek individualized choice-of-law
determinations, we would think concerns about standing, such as
those raised here, would warrant a less liberal approach than
suggested by Bondi, supra, 423 N.J. Super. at 436-39, which we
discussed above and again later in this opinion. In short, a
court should not be expected to choose the law appropriate for
each plaintiff as to each claim, only to have, for example,
plaintiff X lay claim to a right to pursue an award of damages
based on injuries sustained by plaintiff Y.

                                       39                                 A-0963-12T1
permitted by Ginsberg, does not serve our chief, overarching

goal of seeking an equitable method for resolving the parties'

choice-of-law disputes.

                             (c) New Jersey's
                             Racketeering Laws

      In enacting anti-racketeering legislation, N.J.S.A. 2C:41-1

to   -6.2,28   the   Legislature     utilized     federal   statutes   as    its

model. Accordingly, federal case law provides a useful guide in

understanding our own RICO law. Cagno, supra, 211 N.J. at 508.

In this regard, it is noteworthy that the federal and New Jersey

enactments expressly afford a private civil cause of action, see

18 U.S.C.A. § 1964(c); N.J.S.A. 2C:41-4(c), whereas New York's

similar law, which we discuss in Section IV(A)(3)(d), infra,

does not. The New Jersey and federal enactments allow "[a]ny

person," who is injured "in his business or property by reason

of a violation" of the statute, to "sue therefore" and recover

treble   damages,     plus   costs    of   suit    including   a   reasonable

attorney's fee. 18 U.S.C.A. § 1964(c); N.J.S.A. 2C:41-4(c).

      All remedies permitted by our RICO law are "cumulative with

each other and other remedies at law," N.J.S.A. 2C:41-6.1, and

28Better known as our RICO law. State v. Cagno, 211 N.J. 488,
508 (2012), cert. denied, ___ U.S. ___, 133 S. Ct. 877, 184 L.
Ed. 2d 687 (2013); State v. Ball, 268 N.J. Super. 72, 98 (App.
Div. 1993), aff'd, 141 N.J. 142 (1995), cert. denied, 516 U.S.
1075, 116 S. Ct. 779, 133 L. Ed. 2d 731 (1996).

                                      40                               A-0963-12T1
the   Legislature         has    instructed       that    our     RICO     law   must      be

"liberally        construed       to    effect       [its]      remedial       purposes,"

N.J.S.A. 2C:41-6.

      The    required       "racketeering         activity,"       also       known   as    a

predicate    act,     must       itself   be     a   criminal      offense.      N.J.S.A.

2C:41-1(a)(1), (2); Ball, supra, 141 N.J. at 162; Karo Mktg.

Corp. v. Playdrome Am., 331 N.J. Super. 430, 438 (App. Div.),

certif. denied, 165 N.J. 603 (2000). In fact, the predicate act

may not only be one of the crimes the Legislature has identified

but   also   an    "equivalent         crime"    under    the     law    of    "any   other

jurisdiction," N.J.S.A. 2C:41-1(a).

      A "pattern of racketeering activity" requires two predicate

acts,   N.J.S.A.      2C:41-1(d)(1),        that      have      "either    the    same     or

similar purposes, results, participants or victims or methods of

commission     or     are       otherwise      interrelated        by     distinguishing

characteristics and are not isolated incidents," N.J.S.A. 2C:41-

1(d)(2). Participation in a conspiracy to commit prohibited RICO

activity is also prohibited activity. N.J.S.A. 2C:41-2(d). The

designation of conspiracy as racketeering activity under federal

law means that the conspiracy itself may be one of the required

predicate acts. State v. Bisaccia, 319 N.J. Super. 1, 20-21

(App. Div. 1999). In a private civil RICO action, the predicate

act   must   be     the    proximate      cause      of   the    plaintiff's      injury.

                                            41                                    A-0963-12T1
Interchange State Bank v. Veglia, 286 N.J. Super. 164, 178 (App.

Div. 1995) (citing Holmes v. Sec. Inv'r Prot. Corp., 503 U.S.
258, 265, 112 S. Ct. 1311, 1316-18, 117 L. Ed. 2d 532, 543

(1992)), certif. denied, 144 N.J. 377 (1996).

    The prohibited RICO activity relevant here is participation

in an "enterprise" which engages in "a pattern of racketeering

activity." N.J.S.A. 2C:41-2(c). The Legislature did not intend

"to punish mere repeated offenses," so the term "pattern" also

requires "relatedness," which means "some temporal connection or

continuity over time," but nonetheless encompasses "short-term

criminal activity" of the proscribed kind as well as "long-term

criminal    activity."        Ball,   supra,    141    N.J.       at     167-69.

"Enterprise"     is   broadly    defined   to   include       all      kinds   of

entities,   as   well    as    "any   individual"     and   any     "group     of

individuals" who are "associated in fact although not a legal

entity." N.J.S.A. 2C:41-1(c). The enterprise may be "licit" or

"illicit." Ibid.

    The enterprise is a statutory element "distinct from the

incidents constituting the pattern of activity." Ball, supra,

141 N.J. at 162. Because it is distinct, the enterprise must

have an "organization" but the organization need not have "a

structure with a particular configuration." Ibid.; accord Cagno,

supra, 211 N.J. at 494. "[A]n informal organization functioning

                                      42                                A-0963-12T1
as a continuing unit" is sufficient to facilitate "those kinds

of   interactions   that   become    necessary   when   a   group,    to

accomplish its goal, divides among its members the tasks that

are necessary to achieve a common purpose." Ball, supra, 141

N.J. at 161-62.

     Although evidence establishing the enterprise must "focus"

on "how the participants associated with each other" and on the

extent and nature of the planning, id. at 162-63, it "need not

be distinct or different from the proof that establishes the

pattern of racketeering activity," id. at 162, and a defendant

only needs to possess "some minimal knowledge" of "'the general

nature of the enterprise . . . beyond his individual role.'" Id.

at 176 (quoting United States v. Eufrasio, 935 F.2d 553, 577 (3d

Cir. 1991)). In this regard, our Supreme Court has declined to

endorse a definition of enterprise. Id. at 177. An enterprise

may be as little as "the sum of the racketeering acts," with

neither a "definable structure" nor any "purpose . . . greater

than the predicate acts," as we held in Ball, supra, 268 N.J.

Super. at 143-44.

     For an enterprise's pattern of racketeering to constitute a

RICO violation, it must "affect trade or commerce," N.J.S.A.

2C:41-2, which is defined as including "all economic activity

involving or relating to any commodity or service," N.J.S.A.

                                    43                         A-0963-12T1
2C:41-1(h).      That   definition        of     "trade      or    commerce"       does   not

specify that the trade or commerce occur within this State,

N.J.S.A.       2C:41-1(h),         but     the     Legislature             declared       the

enactment's      purpose    to     be    the    protection         of     "the   legitimate

trade    or    commerce     of    this    State"       and    "the       general    health,

welfare and prosperity of the State and its inhabitants" from

"the     infiltration"       of     the    prohibited             kinds     of    activity.

N.J.S.A. 2C:41-1.1(c).

       We     have   held   that    those       declarations,            along    with    the

Legislature's finding of harm to "this State's economy" from

racketeering, N.J.S.A. 2C:41-1.1(b), require that a plaintiff

show the prohibited conduct has affected the trade or commerce

of this State." State v. Casilla, 362 N.J. Super. 554, 563-64

(App. Div.) (quoting N.J.S.A. 2C:41-1.1(c); emphasis omitted),

certif. denied, 178 N.J. 251 (2003). We have also observed that

the Legislature would have had no reason to address the effects

of racketeering in other states, many of which have their own

RICO statutes, or in interstate commerce, as to which federal

legislation applies. Id. at 564-65.

       In a criminal prosecution, in addition to subject matter

and     personal     jurisdiction,        a      New   Jersey           court    must     have

"territoriality," meaning territorial jurisdiction pursuant to

N.J.S.A. 2C:1-3. State v. Denofa, 187 N.J. 24, 36 (2006). That

                                           44                                       A-0963-12T1
statute recognizes various ways in which an offense may have "a

direct nexus to New Jersey" that would justify its prosecution

as a criminal offense here. State v. Sumulikoski, 221 N.J. 93,

102 (2015).

      The   plainest     examples        of     territoriality         are    when          the

"result" of the offense "occurs within this State," or when the

"conduct    which   is   an    element        of    the     offense"    occurs           here.

N.J.S.A. 2C:1-3(a)(1). Conduct committed outside the State has a

nexus to New Jersey if New Jersey law would view such acts as

"constitut[ing] an attempt to commit a crime within the State,"

N.J.S.A.    2C:1-3(a)(2),      meaning        an    attempt      to   cause       a    result

within the State that would be an offense if caused by in-state

conduct. See State v. Bragg, 295 N.J. Super. 459, 464-65 (App.

Div. 1996). Outside conduct is also sufficient if New Jersey law

would deem it "a conspiracy to commit an offense within the

State," as long as there is also an "overt act in furtherance

of"   the   conspiracy       that   is    committed         here.     N.J.S.A.           2C:1-

3(a)(3). Conversely, our courts have jurisdiction over conduct

occurring    within    the    State      that      causes    a   result      in       another

state, or is part of an attempt or conspiracy to do so, as long

as that conduct would be an offense under both New Jersey law

and the other state's law. N.J.S.A. 2C:1-3(a)(4).

                                          45                                          A-0963-12T1
                                     (d) New York's
                                    Racketeering Laws

    Turning to New York's Organized Crime Control Act (OCCA),

1986 N.Y. Laws, c. 516, § 2; N.Y. Penal Law §§ 460.00 to 460.80

(Consol. 2014), we first observe that a violation is called the

crime    of    "enterprise          corruption,"            N.Y.     Penal    Law        § 460.20.

Unlike     New      Jersey's        law,    OCCA       is     not    modeled        on    federal

statutes.      It    "is      far    more    restrictive             than"    federal        RICO,

because New York "calculatedly narrowed the definition of the

requisite pattern of criminal activity" to avoid conflating an

ordinary      "criminal       offense       or    criminal         transaction"          with   the

ongoing "pattern" that characterizes organized crime.                                     Simpson

Elec. Corp. v. Leucadia, Inc., 515 N.Y.S.2d 794, 799 (App. Div.

1987),   aff’d,       530 N.E.2d 860       (N.Y.    1988);        N.Y.    Penal      Law

§ 460.10.

    OCCA       allows       designated           county       and    state     officials         to

prosecute      charges        of    enterprise         corruption.           N.Y.    Penal      Law

§ 460.50. Although the New York Legislature's findings declare

OCCA's   purposes        to    include       "making          both    criminal       and     civil

remedies available," N.Y. Penal Law § 460.00, the only penalties

it provides, beyond incarceration, are criminal forfeiture and

fines allocated primarily to victim restitution. N.Y. Penal Law

§ 460.30.        Those     penalties        may       only     be    imposed        on    persons

convicted of enterprise corruption. Ibid.

                                                 46                                       A-0963-12T1
      Unlike our Legislature's approach, the New York Legislature

rejected a policy of either liberal or strict construction in

order    to     preserve            a    role    for      "discretion."        N.Y.       Penal       Law

§ 460.00. Even when "the letter of the law" defining an OCCA

violation       is    satisfied,            "the     question         whether       to    prosecute"

under     OCCA       "is       essentially           one       of    fairness."          Ibid.    Such

"fairness"         was     preserved            by   leaving         the   decision        to    label

alleged criminal conduct as "enterprise corruption" to "those

institutions of government which have traditionally exercised

that function: the grand jury, the public prosecutor, and an

independent judiciary." Ibid. OCCA accordingly does not provide

for a private civil cause of action, see, e.g., Simpson, supra,

515 N.Y.S.2d at 807 (Spatt, J., dissenting), as the parties

concede.

      OCCA      liability               requires     the       personal     commission           of   "a

pattern       of     criminal            activity"         comprising         two    felonies:         a

conspiracy to engage in a "criminal enterprise" and a knowing

participation            in    the       activity         or    finances      of    the     criminal

enterprise, or of any other enterprise. N.Y. Penal Law § 460.20.

OCCA also specifies that the pattern of criminal activity may

not     serve      as         the       "criminal         enterprise."        N.Y.       Penal        Law

§ 460.10(1). Instead, the criminal enterprise must consist of "a

group    of     persons         sharing         a    common         purpose    of    engaging         in

                                                     47                                     A-0963-12T1
criminal      conduct,       associated      in     an     ascertainable          structure

distinct      from     a    pattern     of   criminal       activity,          and     with    a

continuity of existence, structure and criminal purpose beyond

the   scope     of    individual      criminal      incidents."          Ibid.       In   Ball,

supra, 141 N.J. at 159, our Supreme Court observed that OCCA was

unique among the federal and other state RICO enactments because

it explicitly required an ascertainable structure, separate from

the    underlying          crimes     that        constituted           the    pattern        of

racketeering activity.

       Unlike       New    Jersey   law,     OCCA     does       not     specify      that     a

violation must affect trade or commerce, or indeed, that any

particular      effect      must    have     occurred       or     be    deemed      to   have

occurred within New York's borders.

       Consequently, in light of the vastly different approaches

engaged by New Jersey and New York to combat racketeering, there

is    no    doubt    that    a   true    conflict         exists       for    choice-of-law

purposes.

                                    (e) The Choice

       In examining the trial court's choice, we start with our

Supreme       Court's        observation          that,     "[a]lthough           we      have

traditionally denominated our conflicts approach as a flexible

'governmental interest' analysis, we have continuously resorted

to    the    [Second       Restatement]      in     resolving       conflict         disputes

                                             48                                       A-0963-12T1
arising    out    of    tort."      P.V.,       supra,      197     N.J.    at    135-36.    The

Second Restatement's approach focuses on the state with "the

'most significant relationship'" to the parties and issues. Id.

at 136.

      "Probably        the    most       important         function        of    choice-of-law

rules" is to foster comity by promoting "harmonious relations"

and   facilitating       "commercial            intercourse"          between       and    among

states. Restatement (Second), supra, § 6 cmt. d. The first step

is to establish that "an actual conflict exists" between the

laws of the involved states. P.V., supra, 197 N.J. at 143. A

conflict arises, like here, when one state provides a cause of

action but the other does not, especially when that provision or

denial    reflects       an    intent       to       regulate       conduct       rather    than

allocate     losses.         Id.    at    143-44,          148-51     (observing      that     a

conflict     existed         between      New        Jersey    law,     which      maintained

statutory        immunity          from     tort        liability           for    charitable

corporations,          and     Pennsylvania             law,        which        "definitively

abrogated its charitable immunity laws").

      A conflict, however, does not always lead to a choice-of-

law analysis. The analysis is preempted when our Legislature has

determined       that        New     Jersey          public       policy        requires     the

application      of    our    substantive            law    whenever       our    courts    have

jurisdiction over the kind of claim at issue, regardless of the

                                                49                                    A-0963-12T1
interest of another state. See id. at 140 (citing Restatement

(Second), supra, § 6(1)).

                              (i) Legislative Directive

       Because       a    choice-of-law      analysis      may   be      precluded    or

preempted by law, our first task, in light of the arguments

posed, requires that we ascertain whether there is a legislative

direction regarding the application of substantive law. For the

reasons that follow, we conclude that our Legislature has not

made    such     a       declaration   for        cases   like   this,     either    (a)

expressly, or (b) by implication.

                                   a. Is There an
                                 Express Directive?

       Plaintiffs are mistaken in arguing that our Legislature has

expressly required the application of our RICO laws to out-of-

state conduct. In this respect, plaintiffs rely on provisions in

our Criminal Code that express its territorial parameters. The

Code recognizes its application to conduct occurring "outside

the State" so long as it "constitute[s] an attempt to commit a

crime within the State," N.J.S.A. 2C:1-3(a)(2), or to "conduct

occurring outside the State" so long as it "is sufficient under

the law of this State to constitute a conspiracy to commit an

offense within the State and an overt act in furtherance of such

conspiracy occurs within the State," N.J.S.A. 2C:1-3(a)(3).

                                             50                               A-0963-12T1
      Because the criminal racketeering laws are also included

within the Criminal Code, plaintiffs argue that the territorial

reach     applicable       to    a      criminal         prosecution         under      those

racketeering laws also applies to a private RICO action brought

under     those    same     laws       and     principles.         We     disagree.        The

territorial       parameters      delineated         in    N.J.S.A.       2C:1-3(a),        by

their very terms, apply to criminal prosecutions, not private

civil causes of action that may be based on provisions of the

Criminal Code. N.J.S.A. 2C:1-3(a) unmistakably states that its

six territorial rules apply to "a person [who] may be convicted

under the law of this State of an offense . . . for which he is

legally accountable" (emphasis added).

      Consequently, despite plaintiffs' forceful argument, this

provision        does     not    contain           the     "preemptive         legislative

expression,"       State    Farm       Mut.    Auto.       Ins.    Co.    v.    Estate      of

Simmons,    84 N.J. 28,    39    (1980),          necessary      to    support      the

imposition of our substantive law to conduct occurring outside

the     State.    Because       such    an     extensive          reach      would    likely

constitute "an impermissible intrusion into the affairs of other

states," O'Connor v. Busch Gardens, 255 N.J. Super. 545, 549-50

(App. Div. 1992), we reject the contention that N.J.S.A. 2C:1-

3(a) constitutes a legislative directive as to the reach of New

Jersey substantive law in a private RICO cause of action.

                                              51                                     A-0963-12T1
                                   b. Is There an
                                 Implied Directive?

         We   also    reject     any   contention        that   such       a    legislative

directive may be found by implication here.

         The preeminent expression of New Jersey public policy is

the Legislature's enactments. State Farm, supra, 84 N.J. at 39.

If   a    statute     declares     that    a    substantive         rule   applies       in   a

situation that would otherwise pose a choice-of-law question,

"New Jersey courts would follow that directive even when the law

of other jurisdictions dictated a contrary result." Ibid. That

understanding conforms with the Second Restatement's instruction

that, "subject to constitutional restrictions," a court "will

follow a statutory directive of its own state on choice of law."

Restatement          (Second),     supra,       § 6(1).       Examples         include    the

Uniform Commercial Code provisions that direct courts to choose

the law "of a particular state" or of the state that the parties

specified. Id. at § 6 cmt. a.

         But,   because    statutes       are       usually   not    so    "explicit,"        a

court may determine whether the issue presented "falls within

the intended range of application of a particular statute." Id.

at § 6 cmt. b & cmt. c. The Legislature's intended "range of

application" should be enforced "when these intentions can be

ascertained and can constitutionally be given effect," even if

                                               52                                  A-0963-12T1
another state's substantive law "would be applicable under usual

choice-of-law      principles."        Id.    at    §    6     cmt.   b.    Thus,    if    the

forum's legislature "intended that the statute should be applied

to the out-of-state facts involved, the court should so apply

it[.]" Ibid. "On the other hand, if the legislature intended

that the statute should be applied only to acts taking place

within the state, the statute should not be given a wider range

of application." Ibid.

       The absence of such a declaration in an enactment implies

the Legislature intended application only to conduct or results

that    occur    within    the    State,      and       that    it    did   not     have   an

interest in facilitating or preventing developments occurring

elsewhere. Van Slyke v. Worthington, 265 N.J. Super. 603, 613-14

(Law    Div.    1992).    The    Second      Restatement         similarly     recognizes

that laws are commonly "formulated solely with the intrastate

situation in mind," with no suggestion they are "intended to

have extraterritorial application." Restatement (Second), supra,

§ 6 cmt. e. That would explain the absence in P.V., supra, 197

N.J. at 148-49, of a suggestion that the Charitable Immunity Act

could     be    understood        as    containing             such    a     declaration,

notwithstanding the "importance" of that enactment's remedial

                                             53                                     A-0963-12T1
policy and the Legislature's mandate to construe the enactment

liberally.29

     The higher standards for criminal liability in New York's

OCCA, when compared to those in New Jersey's RICO statutes,

meant that a defendant would be exposed to liability under New

Jersey's local law for conduct that would not be illegal under

New York's law.     The New York     Legislature made    its enactment

narrower   than   federal   RICO,   instead   of   broader   as   did   our

Legislature. See Ball, supra, 268 N.J. Super. at 107. New York

29Plaintiffs emphasize two decisions from other jurisdictions in
support of their position. We do not find they suggest a
contrary view than that which we have reached. In Marshall v.
Fenstermacher, 388 F. Supp. 2d 536, 547 (E.D. Pa. 2005), the
court was required to apply "the conflicts regime of the forum
state," Pennsylvania. The plaintiff had asserted common law
torts under both Pennsylvania and New Jersey law but asserted
RICO claims only under New Jersey and federal law, id. at 546,
presumably because Pennsylvania's statute, like New York's, did
not afford a private civil cause of action. See 18 Pa. Cons.
Stat. § 911. The court simply stated that it would consider the
New Jersey RICO claims under the New Jersey statute, with no
mention of choice-of-law doctrine and without citation to New
Jersey's RICO or general territoriality statutes. Marshall,
supra, 388 F. Supp. 2d at 562 n.29. In the other case urged by
plaintiffs, Houston v. Whittier, 216 P.3d 1272, 1278-80 (Idaho
2009), it was explained that Idaho courts were not automatically
compelled to let a plaintiff assert Oregon causes of action
simply because they were statutory. Instead, the court had to
find the absence of a conflict with "the public policy of the
forum," and allowed the maintenance of the causes of action only
after finding that Oregon statutes were "virtually identical" to
Idaho's. Id. at 1279-80. Thus, plaintiffs are mistaken in
suggesting that Houston presents an instance in which the
existence of a statutory cause of action precluded a court from
conducting a choice-of-law analysis.

                                    54                            A-0963-12T1
also    precluded      private    litigants        from     pursuing    cases    that

prosecutors with limited resources might decline, as opposed to

New Jersey's decision to encourage private litigants with the

prospect of treble damages and counsel fee awards. Cf. Lindsey

v. Allstate Ins. Co., 34 F. Supp. 2d 636, 646 (W.D. Tenn. 1999)

(observing that Congress included a private cause of action in

federal     RICO       "[t]o     facilitate        the     enforcement     of     its

provisions"); Metro Int'l, Inc. v. Alco Standard Corp., 657 F.

Supp.     627,   634     (M.D.    Pa.    1986)      (recognizing       that,    "[t]o

facilitate and strengthen enforcement," Congress created RICO

with a private right of action for treble damages).

       As in P.V., supra, 197 N.J. at 148-49, the difference in

approaches reflected a difference in policy and not a reflection

of mere variations in the procedural rules to be followed in

establishing       a    liability       that     both     states   recognized      in

principle for the alleged conduct, as was the case in both State

Farm, supra, 84 N.J. at 42-43, and Cornett, supra, 211 N.J. at

377-78. We, thus, recognize that it is immaterial whether the

New York Legislature's motivation was to protect individuals or

the preeminence of its financial marketplace by limiting the

vehicles that private litigants could use to inhibit incidental

activity. It only matters that New York and New Jersey reached

"conflicting       resolutions     of    a     particular    policy    issue."    See

                                          55                               A-0963-12T1
Boyes v. Greenwich Boat Works, Inc., 27 F. Supp. 2d 543, 548

(D.N.J.   1998).    In    other   words,    New   York   did   not    intend,   by

enacting OCCA, to regulate all the conduct New Jersey intended

to reach in enacting its RICO laws; consequently, we reject

plaintiffs' characterization of the New Jersey private right of

action as simply a stronger remedy to advance an out-of-state

policy that is otherwise the same as the in-state policy.

                             (ii) Application of
                           The Second Restatement

    Having found no legislative directive that would govern the

choice-of-law problem, we turn to the Second Restatement and

examine its: (a) section 6 factors; (b) section 145 principles;

and (c) specific tort principles.

                                  a. Section 6

    In the absence of an explicit statutory directive or a

directive    that        can   "be   ascertained         by    a     process    of

interpretation and construction," Restatement (Second), supra,

§ 6 cmt. b, there is a nonexclusive list of seven factors to be

considered in choosing the applicable law:

            (a) the needs of the interstate and inter-
            national systems,

            (b)    the relevant policies of the forum,

            (c) the    relevant   policies    of   other
            interested states and the relative interests

                                       56                                A-0963-12T1
            of those states in the determination of the
            particular issue,

            (d) the       protection         of    justified     expecta-
            tions,

            (e) the    basic  policies                   underlying     the
            particular field of law,

            (f) certainty, predictability and uniform-
            ity of result, and

            (g) ease in the determination and applica-
            tion of the law to be applied.

            [Id. at § 6(2).]

    The     factor      that       deserves       the    greatest     emphasis     in     a

particular case is that which furthers the most relevant policy

interest, such as "protecting the justified expectations of the

parties" or "favoring uniformity of result." Id. at § 6 cmt. c.

"Generally speaking, it would be unfair and improper to hold a

person   liable       under    a    local    law    of    one   state    when    he     had

justifiably molded his conduct to conform to the requirements of

another state," as opposed to acting "without giving thought to

the legal consequences of [his] conduct or to the law that may

be applied." Id. at § 6 cmt. g. When "the purposes sought to be

achieved    by    a    local       statute    or    common      law   rule     would     be

furthered   by    its    application         to    out-of-state       facts,    however,

this is a weighty reason why such application should be made."

Id. at § 6 cmt. e.

                                             57                                 A-0963-12T1
       The    proper      choice       often     "represents         an    accommodation         of

conflicting values" that requires the forum court to name the

"general      principle"          that    deserves          the    most    weight    and       then

analyze the circumstances of the case in that regard. Id. at § 6

cmt. c. Without a statutory mandate to apply its own local law,

a court "must decide for itself whether the purposes sought to

[be] achieved by a local statute or rule should be furthered at

the expense of" other relevant factors. Id. at § 6 cmt. e. Those

include "the relevant policies of all other interested states"

and    their       "relative         interest"        in    regulating      the     underlying

conduct that gave rise to the litigation, or in providing a

remedy       for     a     particular          plaintiff          against     a     particular

defendant.         Id.    at     § 6   cmt. f.        "[W]here      the    policies       of    the

interested         states      are     largely    the       same    but    where    there       are

nevertheless minor differences between their relevant local law

rules," there is "good reason for the court to apply the local

law of that state which will best achieve the basic policy, or

policies, underlying the particular field of law involved." Id.

at § 6 cmt. h.

       In applying section 6 of the Second Restatement in P.V.,

supra,      197    N.J.     at    152-53,      the     Court       noted    that    interstate

comity additionally counsels that the forum state should defer

to    the    other       state's       local     law       if:    (1) applying      the    forum

                                                 58                                   A-0963-12T1
state's local law would "substantially impair" the other state's

ability "to regulate the conduct of those who chose to operate

within its borders," and (2) applying the other state's local

law would not inhibit the forum's ability to regulate conduct

that occurs within its own borders. For example, the plaintiff

in P.V. was a New Jersey resident pursuing a tort claim against

a   Pennsylvania       charity        for     conduct     that      occurred      in

Pennsylvania. Id. at 135. The Court found both of the conditions

that it noted for affording comity: (1) applying New Jersey's

broad charitable immunity to the activity in Pennsylvania would

"substantially impair[]" Pennsylvania's "ability to regulate the

conduct of those who chose to operate within its borders," and

(2) applying Pennsylvania law would not prevent New Jersey from

applying its law of charitable immunity to activities within New

Jersey. Id. at 153.

     The parallel of this case to P.V. rests on the fact that

the alleged RICO activity predominantly occurred in New York

rather   than   New   Jersey,    and    was    primarily     aimed    at   harming

plaintiffs      indirectly      by     damaging     their        reputation       by

influencing     the   mostly    New    York-based       financial    markets     and

financial news media. In those circumstances, the application of

New York law would not set a precedent that inhibits New Jersey

from providing a civil cause of action for in-state activities

                                        59                                 A-0963-12T1
that qualify as racketeering under New Jersey's statute; New

Jersey    could   still   protect    its    domiciliaries    and    New    Jersey

commerce from harm that is felt mostly within its borders.

    In contrast, applying New Jersey's civil cause of action

would nullify New York's policy of protecting analogous activity

from being prosecuted as "racketeering" by private litigants,

who lack the institutional constraints of prosecutors and grand

juries. These distinctions in the two neighboring state's laws

created    differing   expectations        about   what   conduct   each     would

allow or prohibit.

    This case is, thus, distinguishable from those in which

courts declined to dismiss claims recognized under New Jersey

local law, even though out-of-state plaintiffs might have been

unable to pursue such causes of action under their own state's

local law.        In those matters, the plaintiffs were allowed to

pursue their claims on the ground that their home states had no

reason to deny them the fortuity of a remedy for what both

states    recognized   as   "the    same    evil,"   even   if   they     did   not

recognize it to the same degree. See Boyes, supra, 27 F. Supp.
2d at 547-48 (recognizing that Pennsylvania had no interest in

denying its residents the greater damages available under New

Jersey consumer fraud statutes for claims against a New Jersey

seller); Smith v. Alza Corp., 400 N.J. Super. 529, 542-51 (App.

                                      60                                  A-0963-12T1
Div. 2008) (recognizing that Alabama had no interest in denying

its residents the procedural and substantive advantages afforded

under     New   Jersey's    product    liability     and       consumer      fraud

statutes, but not Alabama's, for claims against a New Jersey

manufacturer); Almog v. Isr. Travel Advisory Serv., Inc., 298
N.J. Super. 145, 159 (App. Div. 1997) (recognizing Israel had no

interest in denying its citizens the substantive advantages of

New Jersey defamation law in New Jersey residents' claims for

defamation published in New Jersey), appeal dismissed, 152 N.J.
361, cert. denied, 525 U.S. 817, 119 S. Ct. 55, 142 L. Ed. 2d 42

(1998).

    That,       however,   is   not   what's     before    us.    As   we     have

observed, New Jersey and New York local law do not just differ

in the degree to which they deal with an otherwise common policy

of allowing a private civil RICO cause of action. They share no

such interest, as demonstrated by the fact that New Jersey law

permits, and New York law categorically disallows, such private

claims.    Thus,   we   conclude   that    the   section   6     factors     favor

choosing New York as the state providing the applicable law.

                                b. Section 145

    In addition, when a cause of action sounds in tort, the

general choice-of-law rule is to ascertain the state with "the

most significant relationship to the occurrence and the parties

                                      61                                  A-0963-12T1
under     the    principles     stated        in   [section] 6."    Restatement

(Second), supra, § 145(1). That determination is to be made for

each "issue in tort," ibid., meaning each element needed to

establish the tort or a defense to it. Id. at § 145 cmt. d. In

making that determination, certain contacts are "to be taken

into account," including:

            (a) the place where the injury occurred,

            (b) the place where the conduct causing the
            injury occurred,

            (c) the domicil, residence, nationality,
            place of incorporation and place of business
            of the parties, and

            (d) the place where the relationship,                  if
            any, between the parties is centered.

            [Id. at § 145(2).]

Accord P.V., supra, 197 N.J. at 141. Plaintiffs and defendants

have not asserted or alleged a prior relationship that preceded

the alleged events in this dispute.

    The contacts analysis is "not merely quantitative." Id. at

147. Its purpose is to assess the contacts in terms of the

guiding    touchstones     of   the    Second      Restatement's    section       6,

which, "[r]educed to their essence," are: "(1) the interests of

interstate      comity;   (2) the     interests     of   the   parties;   (3) the

interests underlying the field of tort law; (4) the interests of

judicial administration; and (5) the competing interests of the

                                         62                               A-0963-12T1
states." Ibid. (citations omitted).                   The "relative importance"

of the matter's contacts with a state may vary according to "the

nature of the tort involved." Restatement (Second), supra, § 145

cmt. f. Furthermore, for each tort issue, the contacts "are to

be evaluated according to their relative importance with respect

to the particular issue." Id. at § 145 & cmt. d.

       If the primary purpose of the local "tort rule" is to deter

or punish misconduct, then the most important contact will be

the conduct's location. Id. at § 145 cmt. c. "[T]he same is true

when the conduct was required or privileged by the local law of

the state where it took place," id. at § 145 cmt. e, so "[a]

rule   [of     tort]     which    exempts      the    actor    from     liability    for

harmful conduct is entitled to the same consideration in the

choice-of-law process as is a rule which imposes liability," id.

at   § 145     cmt. c.    In     that   way,    the   tort     policies    behind    New

Jersey's local law and New York's local law on private civil

causes    of     action     for     racketeering       are     entitled     to     equal

consideration, even if the purpose of New York's "tort rule" was

to   prevent     private       civil    liability     for     certain    conduct    that

would create such liability in New Jersey. In short, were we to

apply section 145's general rule for torts, we would choose New

York as providing the applicable law because it has the most

significant relationship under section 6.

                                           63                                 A-0963-12T1
                        c. Specific Tort Principles

    In addition to section 145's general factors for torts, the

Second   Restatement     also    provides   more      specific   choice-of-law

rules for particular torts. P.V., supra, 197 N.J. at 141. There

are rules for personal injuries, injuries to tangible things,

injuries    resulting    from    a   plaintiff's      reliance    on    fraud   or

misrepresentations, and injuries resulting from defamation or

injurious    falsehood.       Restatement   (Second),        supra,    §§ 146-51.

Only injurious falsehood is germane to plaintiffs' RICO claim.

    For Second Restatement purposes, an "injurious falsehood"

is any false statement that causes pecuniary loss. Id. at § 151

cmt. a; see also Restatement (Second) of Torts § 623A (1976)

(declaring that an injurious falsehood creates liability for one

who publishes it with knowledge or reckless disregard of its

falsity and with intent "to result in harm to interests of the

other having a pecuniary value"). An injurious falsehood "need

not cast any reflection upon the plaintiff's personal reputation

in order to be actionable." Restatement (Second), supra, § 151

cmt. a. It is enough that the false statement "disparage[s] the

plaintiff's    title     to   his    property,   or    its    quality    or     the

character or conduct of the plaintiff's business." Ibid. This

description encompasses defendants' alleged RICO scheme.

                                       64                                A-0963-12T1
      The Second Restatement does not have another tort rule that

might cover plaintiffs' RICO claims. Plaintiffs' alleged RICO

injuries are not a form of defamation, nor do they constitute a

form of "personal injury" for choice-of-law purposes, because

"personal     injury"    is     limited     to     "physical     harm       or    mental

disturbance,"     which        means   that        "injuries     to     a        person's

reputation . . . are not 'personal injuries' in the sense here

used." Id. at § 146 cmt. b. Plaintiffs' RICO injuries are not

"Injuries to Tangible Things" as used in section 147 of the

Second Restatement. Plaintiffs' alleged injuries do not arise

from "Fraud and Misrepresentation" for choice-of-law purposes

because plaintiffs do not allege that they "suffered pecuniary

harm on account of [their own] reliance on the defendant[s']

false    representations."       Id.   at      §   148(1).    Rather,       plaintiffs

allege reliance by others. Plaintiffs do not assert a defamation

claim,    but    the     rules     for      "Defamation"        and     "Multistate

Defamation" in sections 149 and 150 of the Second Restatement

are   incorporated      into    section        151,   which    covers       "Injurious

Falsehood." Thus, the only rules for specific torts relevant to

plaintiffs'     RICO    claim    are   sections       149    through    151       of   the

Second Restatement.

                                          65                                     A-0963-12T1
      For defamation,30 "the local law of the state where the

publication occurs determines the rights and liabilities of the

parties, except as stated in [section] 150, unless, with respect

to the particular issue, some other state has a more significant

relationship under the principles stated in [section] 6 to the

occurrence       and   the    parties."        Id.   at    § 149.     That    same   rule

governs the choice of law analysis for injurious falsehood. Id.

at   § 151   &    cmt. b.      Here,     the    state      where     the    publications

primarily    occurred        was   the    state      with      the   most    significant

relationship – New York.

      Next, we must consider whether section 150 calls for a

different    result.         For   multistate        defamation,       an     "aggregate

communication" is "any one edition of a book or newspaper, or

any one broadcast over radio or television, exhibition of a

motion   picture,"       or    a   similar       act      of   publication,      id.    at

§ 150(1), meaning "a single aggregate communication to a large

number of persons at one time." Id. at § 150 cmt. c. Multiple

publications of a defamatory statement to numerous individuals

30To be clear, plaintiffs did not assert a defamation claim nor
complained in this appeal that their allegations should have
been interpreted as if they had sought damages based on a claim
of defamation. Nevertheless, their disparagement claims may –
for these purposes – be viewed similarly due to their
theoretical kinship. Cf. Dairy Stores, Inc. v. Sentinel Pub.
Co., 104 N.J. 125, 133 (1986) (recognizing that the torts of
product disparagement and defamation "sometimes overlap").

                                           66                                   A-0963-12T1
are    not    necessarily          "aggregate            communications"            subject       to

section      150,    as    they     can       be    separate     acts        that    require      an

individual      choice-of-law            analysis        that    may    lead      to   differing

results. Id. at § 149 cmt. a. Although plaintiffs have alleged

multiple publications of certain defamatory statements, which

might not qualify as section 150 multistate defamations, they

primarily allege aggregate communications published in a manner

intended to influence all persons and entities who follow or

participate         in    the    financial         marketplace         and    financial         news

media.

      The     "single       publication            rule"      applies        to     section      150

aggregate communications, so the matter may be determined as if

plaintiff has only one cause of action, regardless of the number

of    jurisdictions         in     which       the      aggregate       communication            was

published. Id. at § 150 cmt. c; Restatement (Second) of Torts,

supra, § 577A cmts. e & f.

      In addition, we must consider that, in this context, a

corporation is a legal person and therefore without domicile in

the   choice-of-law             sense.    Restatement           (Second),         supra,      § 150

cmt. f; see also id. at § 11 cmt. 1. Thus, when a corporation

claims       multistate          defamation,            the     state        with      the      most

significant      relationship            to    the      matter   "will        usually      be    the

state where the corporation . . . had its principal place of

                                                   67                                    A-0963-12T1
business" as long as that state was one in which the multistate

defamation was published. Id. at § 150(3). This is because it is

assumed that a corporation sustains its greatest injury from

defamation there. Id. at § 150 cmt. f. Another state, however,

may have the "most significant relationship with respect to the

particular   issue     if    it    is   the    state      where   the   defamatory

communication   caused       plaintiff        the    greatest     injury   to     its

reputation." Ibid.      That can occur if "the matter claimed to be

defamatory   related    to    an    activity        of   the   plaintiff   that   is

principally located in this state," id. at § 150 cmt. f(b), or

"the plaintiff suffered greater special damages in this state

than in the state of its principal place of business," id. at §

150 cmt. f(c), or "the place of principal circulation of the

matter claimed to be defamatory was in this state," id. at § 150

cmt. f(d).

    As alleged by plaintiffs, defendants' RICO scheme targeted

plaintiffs' use of the New York financial markets for securities

offerings and for third-party trading of their securities, which

was an "activity" of plaintiffs that was "principally located

in" New York. Ibid. As a result, New York was the state where

defendants' false communications caused plaintiffs "the greatest

injury to [their] reputation" because the main injury from the

alleged RICO scheme was the decrease in offering and market

                                        68                                 A-0963-12T1
share   prices    due     to    the   reputational         harm    that     plaintiffs

suffered    in    the     markets     where        plaintiffs       conducted      such

"activity."      That   is     bolstered        because,    although       defendants'

publications      were       multistate,          "the     place     of     principal

circulation of the matter claimed to be defamatory was in" New

York.   Ibid.     Thus,      New   York     is     the     state    with    the    most

significant relationship under section 150 as well as sections 6

and 145.

    That      conclusion        remains         undisturbed       when     considering

"special damages." If the injury was the loss of particular

customers   or    of    market     share    in    particular       locations,     those

would also be important contacts in determining which state's

law to apply. See Pony Comput., Inc. v. Equus Comput. Sys. of

Miss., Inc., 162 F.3d 991, 996 (8th Cir. 1998); Jelec USA, Inc.

v. Safety Controls, Inc., 498 F. Supp. 2d 945, 952-53 (S.D. Tex.

2007). As we discuss elsewhere, plaintiffs' cognizable special

damages are the alleged loss of 180 customers throughout the

country. There was no evidence that any loss of customers or

market share occurred to a greater degree in New Jersey than in

New York or elsewhere.

    We also are presented with no ground upon which to conclude

that defamation or disparagement of a parent company generally

amounts to defamation or disparagement of a subsidiary, or vice

                                           69                                 A-0963-12T1
versa. The issue of entity separation for corporate parents and

subsidiaries raises additional questions concerning the locus of

the injury. For example, in a case that concerned the looting of

a corporation rather than its defamation, we favored application

of Delaware's equitable principles to pierce the corporate veil,

and    gave   the    parent    standing     to    protect      financial    interests

against the adverse party, because the parent's interests were

not as distinct from its subsidiary's contractual rights as the

doctrine      of    "entity    separateness"       generally      presumes.      Bondi,

supra,   423       N.J.    Super.   at   437-39.       Although    such   recognition

implies that the subsidiary's injury is also an injury to the

parent, we intended no implication that the locus of the injury

necessarily moved from where the subsidiary as a separate entity

would have felt it to where the parent as a separate entity

would feel it.

       Plaintiffs have alleged and argued that C&F's finances were

inextricably intertwined with Fairfax's. And they have argued

that    the   market       viewed   Fairfax      and    its    subsidiaries      as    so

inseparable         that     some    defendants         bought     shares     of      the

subsidiaries and affiliates as proxies for Fairfax shares, which

had    become      too    costly    to   borrow    due    to     demand   from     those

shorting        Fairfax.      Plaintiffs         have     further     argued       that

defendants' defamation of C&F served the main goal of destroying

                                           70                                 A-0963-12T1
the entirety of Fairfax itself, and defendants rarely bothered

to distinguish among its subsidiaries. According to plaintiffs,

the RICO enterprise operated by spreading false information in

the    financial      markets        and    the        financial      news       media,      and     by

encouraging      federal       law     enforcement             and   securities          officials

outside New Jersey to investigate Fairfax's use of reinsurance.

The goal was to damage Fairfax's reputation in order to reduce

the     market     share       price,           and     the    proceeds           of    securities

offerings, of all Fairfax entities.

       In   responding,           defendants            mostly       view    Fairfax          as    an

integrated company whose general financial instability reached

every    branch       of    the    Fairfax            family    tree.31      And        defendants'

criticisms       of   C&F     served        more       as     criticism      of        the   Fairfax

edifice     than      criticisms           of     C&F       individually.          Indeed,         some

defendants expressly articulated an intent for their criticisms

of a subsidiary, or their short positions in a subsidiary, to

harm    plaintiff          Fairfax    Financial             Holdings.       In     addition,         we

observe     that      the      parent           corporation          of     the        financially-

intertwined Fairfax entities was located in Toronto, and all

share-trading occurred on the New York Stock Exchange or the

Toronto Stock Exchange.

31 We have appended to this opinion a graph setting forth the
relationship of the various Fairfax entities.

                                                  71                                         A-0963-12T1
    In    summary,    the    weight    of    the    conduct     in    this      alleged

enterprise of multistate disparagement was in New York, not New

Jersey.   The   financial     markets       and    financial     news    media    were

predominantly located in New York, making New York central to

defendants'     publications.    New     York      is    "the   state     where    the

[harmful]     communication[s]        caused       the     greatest      injury     to

[plaintiffs'] reputation." Restatement (Second), supra, § 150

cmt. f. For all these reasons, New York has "a more significant

relationship to the occurrences and the parties." Ibid.

                              (iii) Conclusion

    For     these    reasons,    we     conclude         that   the     trial    judge

correctly   gave     C&F's   direct    alleged      losses      little    weight    in

balancing the state contacts and interests for the RICO claims.

We, thus, affirm the determination that New York law applied and

that, in applying New York law, plaintiffs' racketeering claim

could not stand.

                                        72                                   A-0963-12T1
                                           B

                            THE MAINTAINABILITY OF
                            THE COMMON LAW CLAIMS

     Plaintiffs contend the trial judge erroneously dismissed

two of their common law claims.32 They first argue the trial

judge    mistakenly       applied    New    York's    statute      of     limitations

rather    than    New     Jersey's       more   generous       time-bar    to      their

disparagement      claim,33       and,     second,    they      argue     the      judge

erroneously      excluded    evidence      of   damages    on    their     claims       of

disparagement       and     tortious       interference         with      prospective

economic advantage.

                          (1) Statute of Limitations
                          Applicable to Plaintiffs'
                              Disparagement Claim

     Plaintiffs argue the trial judge erred in ascertaining the

appropriate      statute     of   limitations        to   be    applied     to     their

disparagement claim. They argued in the trial court that New

32 Plaintiffs do not address in their appeal the trial court's
disposition of their tortious interference with contractual
relations claim.

33Morgan Keegan has not only responded to plaintiffs' arguments
about the applicable time-bar, but has also cross-appealed and
argues, among other things, that the trial judge erred in
applying New York's three-year statute of limitations instead of
New York's one-year limitation period.

                                           73                                   A-0963-12T1
Jersey's six-year statute of limitations34 applied, Morgan Keegan

argued   for    application     of     New       York's    one-year    statute       of

limitations,35 and the trial judge found controlling the three-

year New York statute of limitations.36

      After    this   appeal   was    argued       the    Supreme   Court   decided

McCarrell v. Hoffmann-LaRoche, Inc., supra, 227 N.J. at 574-75,37

which illuminates our way by holding that section 142 of the

Second Restatement "is now the operative choice-of-law rule for

resolving     statute-of-limitations            conflicts    because   it   .    .   .

channel[s] judicial discretion and lead[s] to more predictable

and   uniform     results      that    are        consistent    with    the      just

expectations of the parties." The Court described its holding as

"a    natural     progression         in        [its]     conversion    from      the

governmental-interest       test      to    the    Second    Restatement      [which

34N.J.S.A. 2A:14-1 (declaring that "[e]very action at law for .
. . any tortious injury to real or personal property . . . shall
be commenced within 6 years next after the cause of any such
action shall have accrued").

35N.Y. C.P.L.R. § 215(3) (declaring that "an action to recover
damages for," among other things, "libel, slander, [and] false
words causing special damages" "shall be commenced within one
year").

36N.Y. C.P.L.R. § 214(4) (declaring that "an action to recover
damages for an injury to property" "must be commenced within
three years").

37We invited and recently received and considered the parties'
supplemental briefs on McCarrell's impact on the issues in this
case.

                                           74                               A-0963-12T1
began] in P.V.[, supra,] 197 N.J. 132," and which adopted the

methodology         described    earlier     in    this   opinion     for      resolving

conflicts concerning substantive tort law. McCarrell, supra, 227

N.J. at 574-75. McCarrell's approach has certainly simplified

the disposition of most conflicts concerning a choice between

two or more states' statutes of limitations.

    The       process     starts    with     an    understanding      that      when   an

action       is   commenced     here,     "New    Jersey's    choice-of-law         rules

[apply]      in   deciding      whether    this    State's     or   another     state's

statute      of   limitations      governs       the   matter."     Id.   at    583.   In

defining      New    Jersey     choice-of-law      rules,     the   McCarrell       Court

instructed that the first matter of interest is whether there is

a "true conflict." Id. at 584. "When application of the forum

state's or another state's statute of limitations results in the

same outcome, no conflict exists, and the law of the forum state

governs." Ibid. (citing Rowe v. Hoffmann-La Roche, Inc., 189
N.J. 615, 621 (2007)). A true conflict occurs "when a complaint

is timely filed within one state's statute of limitations but is

filed outside another state's." Ibid. (citing Schmelze v. ALZA

Corp., 561 F. Supp. 2d 1046, 1048 (D. Minn. 2008)).

    We can perceive a circumstance – perhaps applicable here –

where    a    complaint    is    filed     within      time   regardless       of   which

competing state's statute of limitations is applied, but the

                                            75                                  A-0963-12T1
scope   of    the    claim      is   limited       or   enhanced      depending     on   the

statute of limitations applied. For example, a plaintiff may sue

on a series of defamatory statements occurring over the course

of two years. If one state has a one-year statute of limitations

and   the    other    has       a    two-year      statute     of     limitations,        the

plaintiff's     suit       –    if    filed      within     one     year    of    the    last

defamatory statement – would be timely filed pursuant to either

state's statute of limitations. But, if the one-year statute of

limitations is found applicable, the allegations or resulting

damages      would    be       limited      by     that     choice     of   law    because

allegations     of    defamatory           statements       made     more   than    a    year

before the suit's commencement would not be cognizable. That

particular     problem         was   not    likely        contemplated      in    McCarrell

because the facts didn't warrant its consideration; that product

liability action was either timely if our statute of limitations

applied or entirely barred if Alabama's applied.

      In any event, other than referring to a "true conflict" as

one which makes a difference as to the timeliness of the suit,

the Court also emphasized that the test is whether the choice of

"statute of limitations is outcome determinative." Id. at 584

(emphasis added). In the example we have provided, the outcome

would be impacted if a suit would be timely under either statute

of limitations because, if the shorter limitations period was

                                              76                                   A-0963-12T1
applied, only the defamatory statements asserted within one year

of the filing would be actionable. In ascertaining the existence

of a true conflict, we assume the McCarrell Court intended the

broader view suggested by its "outcome determinative" language.

Indeed, later in the opinion, the Court again emphasized that

whether the conflict is "outcome determinative" is the question,

and, in that regard, the Court quoted with approval a federal

judge who stated, in a different way, that there is no conflict

if "'there is no divergence between the potentially applicable

laws.'" Id. at 591 n.9 (quoting Spence-Parker v. Del. River &

Bay Auth., 656 F. Supp. 2d 488, 497 (D.N.J. 2009)). Because some

or   most    of    defendants'    allegedly      disparaging       statements    from

2002 to 2006 would cease to be actionable if a shorter New York

statute – either New York's one-year or its three-year statute

of   limitations      –   were   to    be   applied    to   this    2006    complaint

rather      than    New     Jersey's    six-year      statute      of    limitations,

N.J.S.A. 2A:14-1, we conclude that the choice-of-law decision

here is "outcome determinative" and requires a resolution.

       There being a true conflict, McCarrell instructs, 227 N.J.

at 592-93, that we must apply the Second Restatement's section

142,     which     states     that,    "barring    exceptional          circumstances

[that] make such a result unreasonable":

             (1) The forum will apply its own statute of
             limitations barring the claim.

                                            77                               A-0963-12T1
         (2) The forum will apply its own statute of
         limitations permitting the claim unless:

               (a) maintenance of the claim would
               serve no substantial interest of
               the forum; and

               (b) the claim would be barred
               under the statute of limitations
               of   a   state    having   a more
               significant relationship to the
               parties and the occurrence.

Because application of N.J.S.A. 2A:14-1 permits the maintenance

of the claim, subsection (1) of section 142 has no application.

We, thus, gaze toward section 142's subsection (2). And, as the

Court held, under section 142(2)(a), "the statute of limitations

of the forum state generally applies whenever that state has a

substantial   interest   in   the    maintenance   of   the   claim."

McCarrell, supra, 227 N.J. at 593. If that is so, then "the

inquiry ends." Ibid. It is "[o]nly when the forum state has 'no

substantial interest' in the maintenance of the claim [that] a

court [would] consider [s]ection 142(2)(b) – whether 'the claim

would be barred under the statute of limitations of a state

having a more significant relationship to the parties and the

occurrence.'" Ibid.

    In this case, section 142 is easily applied, as anticipated

by McCarrell's description of the test. Ibid. (observing that

section 142: "benefits from an ease of application; places both

                                78                            A-0963-12T1
this State's and out-of-state's citizens on an equal playing

field,       thus        promoting        principles             of      comity;      advances

predictability and uniformity in decision-making; and allows for

greater certainty in the expectations of the parties").                                  Section

142 "makes clear that when New Jersey has a substantial interest

in the litigation and is the forum state, it will generally

apply its statute of limitations." Ibid. Stated another way,

under section 142, the forum state "presumptively applies its

own statute of limitations unless . . . [it] has no significant

interest in the maintenance of the claim and the other state,

whose statute has expired, has 'a more significant relationship

to the parties and the occurrence,' . . . or . . . given 'the

exceptional        circumstances        of     the       case,'    following       the    Second

Restatement         rule        would   lead        to     an     unreasonable        result."

McCarrell, supra, 227 N.J. at 597.

       There       is    no     doubt   that    New        Jersey       has   a    substantial

interest in this litigation. One of the plaintiffs – C&F – has

its    principal         place     of   business          in    New     Jersey     and    claims

injuries to its business caused by the alleged disparagement of

it    and    its    products.       Because      New          Jersey    has   a    significant

interest, it is irrelevant under section 142 that New York has a

"more       significant          relationship            to     the     parties      and       the

occurrence."            Ibid.    Absent      "exceptional              circumstances,"         not

                                               79                                        A-0963-12T1
remotely      suggested        here,      that          this     would      "lead       to    an

unreasonable result," the test described in McCarrell requires

application of our own statute of limitations. Ibid.

      Consequently, the timeliness of plaintiffs' disparagement

cause of action – the only claim as to which plaintiffs argue

the   judge   erred     in    applying        a    shorter,       New    York     statute     of

limitations       –     is    governed            by     our     six-year        statute       of

limitations. N.J.S.A. 2A:14-1.38 See Patel v. Soriano, 369 N.J.

Super.    192,    247    (App.     Div.),         certif.       denied,     182 N.J. 141

(2004).    Although          New   Jersey          has     a     one-year        statute      of

limitations for libel and slander of a person, N.J.S.A. 2A:14-3,

plaintiffs claim commercial disparagement of their business and

products, sometimes referred to as trade libel. Patel, supra,

369 N.J. Super. at 246-47. In New Jersey, "a claim for trade

libel is subject to the general six-year statute of limitations

applicable       to   malicious         interference            claims."        Id.   at     247.

Moreover, that statute of limitations applies to disparagement

whether    "the       aspersion         reflects         only     on     the     quality      of

plaintiff's       products,        or    on       the     character        of     plaintiff's

38For these same reasons, we reject the argument Morgan Keegan
asserted in its cross-appeal that the trial judge erred in
applying New York's three-year statute of limitations, instead
of New York's one-year statute of limitations.

                                              80                                       A-0963-12T1
business   as   such."   Ibid.39   Therefore,   "the   more   restricted

statute of limitations for slander does not apply" here. Id. at

249.

       The six-year statute of limitations applies to plaintiffs'

disparagement claims, as well as their other common law causes

of action. The trial judge erred in applying a shorter statute

of limitations.

39 As the trial judge recognized, a statement that attacks an
insurance company as a fraud or a Ponzi scheme, or an assertion
that it is insolvent or bankrupt, among other similar things,
may constitute an attack on its products. Here, statements
disparaging the financial condition of plaintiffs may have a
direct link to its products; plaintiffs are in the business,
through the sale of insurance policies, of making promises to
clients to pay them money in the future in the event of certain
occurrences. Statements that question plaintiffs' ability to
make those payments strike at both the heart of their reputation
and the products they sell – a view that can be seen in the
assertions of Fairfax's chairman and chief executive officer:

           When you're in the insurance business and
           you are selling a promise to pay a claim in
           a year or two or three or four, when you
           have all of this noise . . . when there
           [are] statements made that the company is
           bankrupt, of course, you have clients who
           would not do business with you. Why would a
           client do business with a property casualty
           insurance company that's going bankrupt?

                                   81                           A-0963-12T1
                          2. Dismissal of Plaintiffs'
                   Disparagement and Tortious Interference
                  With Prospective Economic Advantage Claims
                   Based on the Absence of Special Damages

       Plaintiffs also argue the trial court erred in excluding

evidence       of     damages            allegedly     incurred       because      of     both

disparagement            and        tortious    interference          with       prospective

economic advantage. This involves not only a determination of

which       state's       substantive          law     applies      in      assessing      the

maintainability of those common law actions but also the content

of that substantive law.

                                      (a) Choice of Law

       We need not discuss at length our determination that New

York    provides         the    substantive      law     applicable         to   plaintiffs'

common      law     causes          of     action.     Although       the    choice-of-law

principles        discussed           in    Section     IV(B)(1),        supra,     required

application         of    this       State's    statute        of   limitations,        other

choice-of-law principles – already discussed in Section IV(A),

supra,      which    led       to    our   affirmance     of    the    dismissal     of    the

racketeering claim – compel the adoption of New York's common

law    in    assessing         the       sufficiency    of     plaintiffs'        claims   of

                                               82                                   A-0963-12T1
disparagement        and        tortious     interference          with     prospective

economic advantages.40

                                   (b) Common Law
                                    Requirements

       The parties' chief bone of contention concerns the types of

damages plaintiffs were required to assert and prove to sustain

their    claims   of       disparagement         and    tortious     inference        with

prospective economic advantage. We discuss these separately.

                                  (i) Disparagement

       We initially observe that, in New York, defamation claims,

which    are    akin       to    disparagement         claims,     require     "special

damages," meaning an economic loss resulting from the harm to

the    plaintiff's     reputation.         Liberman     v.    Gelstein,     605 N.E.2d
344, 347 (N.Y. 1992); Matherson v. Marchello, 473 N.Y.S.2d 998,

1000    (App.   Div.    1984).      This     requires        the   identification        of

customers who would have dealt with the plaintiff but for the

reputational harm. Squire Records, Inc. v. Vanguard Recording

Soc'y, Inc., 226 N.E.2d 542, 543 (N.Y. 1967);                             Drug Research

Corp. v. Curtis Publ'g Co., 166 N.E.2d 319, 322 (N.Y. 1960);

DiSanto v. Forsyth, 684 N.Y.S.2d 628, 629 (App. Div. 1999);

40We will not conduct an individualized choice-of-law assessment
regarding plaintiffs' common-law claims for reasons expressed
earlier. See Section IV(A)(3)(b), supra.

                                            83                                    A-0963-12T1
Waste Distillation Tech., Inc. v. Blasland & Bouck Eng'rs, P.C.,

523 N.Y.S.2d 875, 877 (App. Div. 1988).

       This principle seems to have emanated from New York state

courts' disagreements with one federal case in New York that had

allowed a substitute measure of damages for a plaintiff that

sold its product only by mail order. Charles Atlas, Ltd. v.

Time-Life Books, Inc., 570 F. Supp. 150, 156 (S.D.N.Y. 1983).

The district judge in Charles Atlas held that it was "virtually

impossible to identify those who did not order the plaintiff's

product because of the" product disparagement, and allowed the

plaintiff    "to   prove   lost   sales   by   other   means"    as   long   as

"'other    factors   [are]    satisfactorily     excluded   by    sufficient

evidence[.]'" Ibid. (quoting William L. Prosser, Handbook of the

Law of Torts § 128, at 923-24 (4th ed. 1971)).41 In rejecting

41   Dean Prosser observed:

            [T]he whole modern tendency is away from any
            such arbitrary rule. Starting with a few
            cases involving goods offered for sale at an
            auction, and extending to others in which
            there has been obvious impossibility of any
            identification of the lost customers, a more
            liberal rule has been applied, requiring the
            plaintiff to be particular only where it is
            reasonable to expect him to do so. It is
            probably still the law everywhere that he
            must either offer the names of those who
            have failed to purchase or explain why it is
            impossible for him to do so; but where he
            cannot, the matter is dealt with by analogy
                                                       (continued)

                                     84                               A-0963-12T1
Charles    Atlas,    New       York's    Appellate      Division       held    that     a

disparagement     claim       is   dependent      on   "evidence       of   particular

persons who ceased to be or refused to become customers." De

Marco-Stone Funeral Home Inc. v. WEBG Broadcasting Inc., 610
N.Y.S.2d 666,     668   (App.     Div.      1994);   see    also    Prince    v.    Fox

Television   Stations,         Inc.,    941 N.Y.S.2d 488,    488    (App.    Div.

2012).

                     (ii) Tortious Interference With
                     Prospective Economic Advantage

    To     sustain        a    claim    for      tortious      interference          with

prospective economic advantage pursuant to New York substantive

law: there must be a prospective business relationship between

the plaintiff and a third party; the defendant must know of that

relationship      and         intentionally       interfere          with     it;     the

defendant's means of interference must amount to a crime, an

independent tort, or conduct that arose solely out of malice;

and the result must be some injury to the relationship with the

third party. Posner v. Lewis, 965 N.E.2d 949, 952 n.2 (N.Y.

(continued)
          to the proof of lost profits resulting from
          breach of contract. If the possibility that
          other factors have caused the loss of the
          general business is satisfactorily excluded
          by sufficient evidence, this seems entirely
          justified   by  the   necessities  of   the
          situation.

                                           85                                  A-0963-12T1
2012); Carvel Corp. v. Noonan, 818 N.E.2d 1100, 1102-03 (N.Y.

2004); Amaranth LLC v. J.P. Morgan Chase & Co., 888 N.Y.S.2d
489, 494-96 (App. Div. 2009). The requirement to specifically

identify    the   business      lost    is    the        same    as   noted     above    with

regard to disparagement claims.

      The    business     prospect          must        be    identifiable,       and     the

plaintiff must show that it would have obtained that prospect's

business but for the interference. Learning Annex Holdings, LLC

v.   Gittelman,     850 N.Y.S.2d 422,    423       (App.     Div.    2008).   The

defendant    must    know       of    the     specific          third    party    and     the

prospective business relationship. See GS Plasticos Limitada v.

Bureau Veritas Consumer Prods. Servs., Inc., 931 N.Y.S.2d 567,

568 (App. Div.), appeal denied, 957 N.E.2d 1159 (N.Y. 2011).

                             (c) Damages Asserted

      To    maintain      its       common        law     claims,       C&F's    marketing

department    developed         a    list     of        180   specifically-identified

customers or potential customers whose business it claims C&F

would have maintained or secured but for defendants' wrongful

acts. C&F employees developed a model of the lost revenue and

profits for each such customer. For the period between 2003 and

2009, they estimated the lost revenue at $102 million and lost

profits at $19 million; the total volume of business "quoted but

not written" by C&F during that period was approximated at $14

                                             86                                    A-0963-12T1
billion,     of     which       the   revenue        lost     on    those      180      accounts

represented less than one percent.

       Jorge    Echemendia,           a   corporate         representative           of    United

States Fire Insurance Company, a wholly-owned subsidiary of C&F,

testified      at    a    deposition        that     he     and    another     C&F      employee

developed      the       list    from     C&F's      records,       which      included          the

customer call report system that was used to archive notes on

existing and potential accounts, and from communications with

brokers      and     other      producers.         C&F      recognized       in    2004        that

customers were paying greater attention to an insurer's ratings

and financial capacity, and it accordingly added those concerns

to the list of reasons that could be cited in a call report as a

cause for losing a particular customer.                            Approximately 170 of

the    180   accounts        in    the      list     were     identified          due     to     the

selection of such a reason in the call report, while the rest

were   identified         from    emails        that     attributed      the      loss      of   an

account to those reasons.

       The trial court found no proof the 180 customers relied on

defendants'          statements.            But        plaintiffs       proffered              that

defendants' scheme was designed to disparage and interfere by

lowering     C&F's       ratings      and    to      cast    doubt    on     the     financial

soundness of C&F and its parent. Plaintiffs' proofs that these

180    customers         relied    on     the     resulting        reduced        ratings        and

                                                87                                        A-0963-12T1
financial        reputation     indicated          these     customers            relied       on

defendants'       statements       indirectly,         as        defendants         allegedly

intended.    For     example,    plaintiffs         cited        a    March      2005    email,

which followed a March 2005 rating agency report. Echemendia

also asserted that "a few" of "the articles distributed by the

defendants" were named in a call report or in an email.

       The question before us is not whether these assertions of

lost    business     are     persuasive       or   even      whether        they     must      be

presented through expert opinion. The question as we understand

it, in light of the trial court's disposition and in light of

New York law, requires a determination of whether plaintiffs

asserted     a   loss   of    business       sufficient          to    withstand        summary

disposition. We find plaintiffs' allegations regarding the 180

lost     customers      were     sufficiently          specific             to     meet       the

requirements of New York law.42

                                    3. Summary

       For   these      reasons,       our    review        of       the    trial       judge's

disposition of the two common law causes of action referred to

in     plaintiffs'      appeal     –     disparagement                and   the      tortious

42 Because plaintiffs' disparagement and tortious interference
with prospective economic advantage claims survive, their claim
of a civil conspiracy may also be further maintained. Corris v.
White, 289 N.Y.S.2d 371, 374 (App. Div. 1968); see also Banco
Popular N. Am. v. Gandi, 184 N.J. 161, 177-78 (2005).

                                             88                                         A-0963-12T1
interference with prospective economic advantage – leads us to

conclude      that:   New   Jersey's   six-year      statute     of    limitations

applies to those claims; New York law imposes a requirement that

plaintiffs     allege     special   damages;   and    summary      judgment     was

erroneously      granted    because    the   claim    of   180    lost    business

prospects was sufficient to meet the requirements of New York

law.

                                        C

                      THE PERSONAL JURISDICTION RULINGS

       Plaintiffs argue that the trial judge erred in dismissing

the Kynikos and Third Point defendants for lack of personal

jurisdiction. Plaintiffs assert that those defendants ought to

be held subject to suit in New Jersey because they participated

in the overarching conspiracy to harm them. In response, these

defendants argue that our courts do not recognize conspiracy-

based jurisdiction and, alternatively, that plaintiffs have not

presented any competent evidence to show they were part of a

conspiracy. As required by Brill, supra, 142 N.J. at 540, we

assume plaintiffs' allegations regarding these defendants are

true    for    purposes     of   determining    whether     the       trial   court

properly      granted     summary   judgment    on    personal        jurisdiction

grounds.

                                       89                                 A-0963-12T1
       Before examining the relationship of these defendants to

New Jersey, we first observe that the due process clause permits

the assertion of personal jurisdiction over a nonresident in two

ways – general and specific jurisdiction. Waste Mgmt., Inc. v.

Admiral Ins. Co., 138 N.J. 106, 119 (1994), cert. denied, 513
U.S. 1183,    115 S. Ct. 1175,   130     L.    Ed.     2d   1128    (1995).     A

nonresident's          continuous      and        systematic         contacts        that

approximate       an     actual     presence           give     rise    to      general

jurisdiction.      Ibid.     Specific        or    "case-linked"        jurisdiction

"depends    on    an     'affiliatio[n]        between         the   forum    and     the

underlying controversy,' principally, activity or an occurrence

that takes place in the forum State and is therefore subject to

the State's regulation." Goodyear Dunlop Tires Operations, S.A.

v. Brown, 564 U.S. 915, 919, 131 S. Ct. 2846, 2851, 180 L. Ed.
2d 796, 803 (2011) (quoting Arthur T. von Mehren & Donald T.

Trautman, Jurisdiction to Adjudicate: A Suggested Analysis, 79

Harv. L. Rev. 1121, 1136 (1966)).

       We, thus, turn to the relationship between these two groups

of defendants – the Kynikos and Third Point defendants – and

this State, and examine whether there is jurisdiction in this

State    over    these    defendants      through       a     consideration     of    the

concepts of (1) general, (2) specific, and (3) conspiracy-based

jurisdiction.

                                          90                                    A-0963-12T1
                              1. General Jurisdiction

                                      (a) Kynikos

       Kynikos – formed in 1985 as a limited partnership organized

in Delaware with its principal place of business in New York –

is an investment advisor and management company that specializes

in    short-selling      and     has    managed     over       $1     billion         for    its

clients.    During the relevant period, Kynikos purchased services

and products from New Jersey vendors; it did not, however, have

any property, an office, a mailing address, a phone number, or a

bank    account    in    this    State.      Kynikos         was    not    registered        to

conduct    business      in    New     Jersey,    and    any       employees      who       were

residents of New Jersey reported to Kynikos's offices in New

York or London.

       Kynikos did not advertise its services in New Jersey. It

operated a password-protected website, which only its existing

or    prospective      clients       could   access.         Kynikos      had    seven      New

Jersey clients between 2002 and 2007; those relationships were

client-initiated and comprised less than one-half of one percent

of Kynikos's total investment assets. Kynikos filed partnership

tax    returns    in    New   Jersey     only     because      some       of    its   related

entities    shared       partial       ownership        of     airplanes         that       were

occasionally hangared at Teterboro Airport in Bergen County.

                                             91                                       A-0963-12T1
      Defendant James S. Chanos, Kynikos's founder and president,

was a New York resident; he did not have a New Jersey mailing

address,    phone    number     or    bank       account.      Chanos    did    not    own

property in New Jersey, and he was not obligated to file a

personal income tax return in New Jersey. Like Kynikos, Chanos

only filed partnership returns in connection with the airplanes

in Bergen County.

      In   September    2000,      defendant       Jeffrey      Perry,    formerly      of

SAC, joined Kynikos as a co-manager. After an alleged "falling

out" with Chanos, Perry left Kynikos in 2005 and joined Third

Point as a senior analyst.             He was a New York resident and had

no New Jersey mailing address, phone number or bank account.

Perry did not own property in, and did not regularly travel to,

New   Jersey.     Although    he     paid    New    Jersey      taxes    in    2005    for

earnings from an unrelated investment, he otherwise has not been

obligated to file a personal income tax return in New Jersey.

      Kynikos traded in Fairfax stock between March 2002 and June

2007, and in Odyssey stock between January 2006 and March 2007.

Kynikos never held stock in, nor traded any interest in, C&F.

                                (b) Third Point

      Third Point – a Delaware limited liability company with its

principal    office     in    New     York       and    a   satellite         office    in

California    –   was   an    employee-owned           hedge    fund    that    serviced

                                            92                                  A-0963-12T1
pooled    investments     and   institutional      investors     and   had    an

investment relationship with the Exis defendants.

      During the relevant period, Third Point provided management

services to a number of funds that traded the securities of

Fairfax   and   related    entities.    Those     funds   paid   Third    Point

management fees; the funds themselves, however, are not parties

to this suit and, in any event, had no New Jersey presence. The

brokers who executed those trades were not located in New Jersey

and no Third Point member resided in New Jersey.

      Between 2002 and 2006, New Jersey residents comprised only

four percent of the investors in Third Point's funds, and less

than two percent of the cash Third Point managed belonged to New

Jersey investors. Third Point paid New Jersey taxes on behalf of

its   investors,   but    the   Third     Point   funds   reimbursed      those

outlays; Third Point itself did not pay New Jersey taxes.

      Third Point purchased services and products from New Jersey

vendors, but those payments were minimal, representing less than

one percent of Third Point's operating budgets between 2002 and

2007. Third Point was not registered to conduct business in New

Jersey, did not own or lease property here, and did not have any

New Jersey-based offices, mailing addresses, phone numbers or

bank accounts. Third Point did not send general solicitations to

New Jersey residents unless such information was requested.

                                     93                                A-0963-12T1
    Defendant          Daniel   S.   Loeb     was   the   managing     member     and

founder of Third Point and, as noted previously, Perry was a

senior analyst. Both Loeb and Perry had their primary residences

in New York and did not travel to New Jersey on a regular basis.

Neither owned nor leased property in New Jersey or maintained a

New Jersey mailing address or phone number.

    Loeb had personal accounts with various New Jersey savings

banks, but he was not required to pay New Jersey income taxes.

Plaintiffs alleged that Loeb directed Perry to help Contogouris

develop    and        disseminate    false     information     about       Fairfax's

health.

    Third Point traded extensively in the following entities

and at the following times: (1) Fairfax, between June 2002 and

February 2007; (2) Odyssey, between November 2005 and December

2006;     (3)     Northbridge        Financial      Corporation,       a    Fairfax

subsidiary located in Canada, between June 2002 and November

2006;   and     (4)    C&F,   between   July    2006   and   April   2007.     Third

Point's trading of C&F-related interests amounted to only three

percent    of    its     overall     Fairfax-related      transactions.        Those

interests, however, consisted of bonds that were not issued by

C&F; they were instead originally issued by non-party Crum &

Forster Funding Corp., a Delaware corporation. C&F assumed those

                                         94                                 A-0963-12T1
bonds on June 30, 2003, through a transaction conducted in New

York purportedly in accordance with New York law.

    Considering the contacts of the Kynikos and Third Point

defendants, we conclude they are insufficient to give our courts

general    jurisdiction       over    them    because       the    contacts      do    not

constitute "continuous and systematic activities in the forum."

Waste Mgmt., supra, 138 N.J. at 119.

                            2. Specific Jurisdiction

    There     being     no     basis     upon       which    to         assert   general

jurisdiction over these defendants, we consider whether they had

specific contacts with persons or entities in New Jersey that

relate to the alleged enterprise or conspiracy. Although we do

not have the benefit of the trial judge's view of plaintiffs'

specific    allegations       of     communications         by     these     defendants

toward    entities     or    persons    in    New    Jersey,       we     have   closely

examined the record in light of the parties' arguments.                          We find

any such communications to be so inconsequential as to justify

rejection   of   the    argument       that   the    court        was    authorized     to

exercise specific jurisdiction over these defendants.

                                         95                                      A-0963-12T1
     As   for      Kynikos,     plaintiffs   allude      to   a   handful    of

communications it had with A.M. Best,43 CNBC,44 and "a New Jersey-

based" Dow Jones reporter, Carol Redmond.45 And, as for Third

Point, other than what has already been discussed, plaintiffs

refer to communications – a few days before plaintiffs commenced

this suit between Third Point and A.M. Best, as well as a number

of other individuals, only a few of whom may have been located

in New Jersey – that attached an article from The New York Post

concerning Fairfax.

     These   few    communications     are   far   too   inconsequential      to

warrant the assertion of jurisdiction over these defendants.

                              3. Conspiracy-Based
                                 Jurisdiction

     Plaintiffs also contend that the court was authorized to

assert jurisdiction over these defendants because of the actions

of other alleged co-conspirators.

43As for A.M. Best, the allegations seem to relate to a single
email, which appears to have little significance to the issues
at hand, since it appears to only pose questions about Fairfax
subsidiaries other than C&F.

44Plaintiffs do not claim Kynikos had direct contact with CNBC
in New Jersey. Rather, plaintiffs referred in their opposing
papers in the trial court to communications with a financial
journalist located outside New Jersey who occasionally appeared
on a show on CNBC, which broadcasts from Englewood Cliffs.

45These communications related only to Kynikos's inclusion as a
party to this lawsuit.

                                      96                              A-0963-12T1
       The trial judge determined, as he explained in his December

23,    2011    written    decision,       that     plaintiffs         had     to      show

defendants affirmatively injected themselves into New Jersey and

that   mere    allegations      of   a   conspiracy      were    insufficient            to

establish      the   requisite       minimum     contacts.       The    court         also

rejected plaintiffs' contention that Fairfax's injuries could be

attributed to C&F for the purpose of analyzing minimum contacts

and concluded that a "comment made as to a Canadian company

cannot by inference be applied to any and all subsidiaries of

Fairfax.      That   [w]ould      unknowingly     impose     jurisdiction             upon

defendants anywhere throughout the world."

       We   review   these     summary    determinations         de    novo.        Spring

Creek Holding Co. v. Shinnihon U.S.A. Co., 399 N.J. Super. 158,

180 (App. Div.), certif. denied, 196 N.J. 85 (2008); YA Global

Invs., L.P. v. Cliff, 419 N.J. Super. 1, 8 (App. Div. 2011). To

survive     these    motions,     plaintiffs     were    required       to    identify

genuine disputes of material fact that could lead a rational

factfinder to resolve the dispute in their favor. Brill, supra,

142 N.J. at 540; Turner v. Wong, 363 N.J. Super. 186, 198-99

(App. Div. 2003). Bare opposing conclusions and speculation are

insufficient. Brill, supra, 142 N.J. at 541.

       In   applying     this     standard,      we     return     to       the      legal

principles      that     govern      a   court's        exercise       of     personal

                                         97                                       A-0963-12T1
jurisdiction. To start, it is of course self-evident that a

court lacking personal jurisdiction has no authority over the

nonresident. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-

72,   105    S.   Ct.   2174,    2181,     85   L.    Ed.    2d   528,   540    (1985);

McKesson Corp. v. Hackensack Med. Imaging, 197 N.J. 262, 275

(2009).     Although    New     Jersey's    long-arm        provision    permits     our

courts to assert jurisdiction over nonresidents, the use of that

authority must comply with the due process limits imposed by the

United States Constitution. Avdel Corp. v. Mecure, 58 N.J. 264,

268   (1971);     Reliance      Nat'l    Ins.   Co.    in    Liquidation       v.   Dana

Transp., Inc., 376 N.J. Super. 537, 543 (App. Div. 2005).

      As we have already observed, those limits recognize two

types   of    personal    jurisdiction,         specific      and    general.       Waste

Mgmt., Inc., supra, 138 N.J. at 119. A nonresident's direct

contacts     with   the    forum    may     vest      the    court   with      specific

jurisdiction; suits premised on a nonresident's continuous and

systematic contacts give rise to general jurisdiction when they

approximate an actual presence in the forum. Ibid.; Lebel v.

Everglades Marina, Inc., 115 N.J. 317, 322-23 (1989).

      In assessing the sufficiency of the relationship between

the forum and the nonresident, the initial step examines two

factors: whether minimum contacts exist at all and whether those

contacts provide adequate grounds for asserting jurisdiction. If

                                           98                                  A-0963-12T1
a plaintiff demonstrates the existence of minimum contacts, the

inquiry shifts to verifying that "the maintenance of the suit

[would]     not    offend     'traditional    notions     of   fair     play    and

substantial justice.'" Int'l Shoe Co. v. Washington, 326 U.S.
310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95, 102 (1945) (quoting

Milliken v. Meyer, 311 U.S. 457, 463, 61 S. Ct. 339, 343, 85 L.

Ed. 278, 283 (1940)); accord Blakey v. Cont'l Airlines, Inc.,

164 N.J. 38, 71 (2000). Relevant factors in the "fair play"

evaluation include "the burden on [the] defendant, the interests

of   the   forum     state,     the   plaintiff's      interest   in    obtaining

relief, the interstate judicial system's interest in efficient

resolution of disputes, and the shared interest of the states in

furthering        fundamental      substantive   social     policies."         Waste

Mgmt., supra, 138 N.J. at 124-25.

      With respect to intentional torts, as alleged here, the

question is whether an intentional act was "calculated to create

an actionable event in a forum state." Blakey, supra, 164 N.J.

at 67 (quoting Waste Mgmt., supra, 138 N.J. at 126). The Court

recently reinforced in Walden v. Fiore, 571 U.S. 12, 14-15, 134
S. Ct. 1115, 1125, 188 L. Ed. 2d 12, 23 (2014), that the focus

is on whether the nonresident "directed his conduct" at the

plaintiff    whom     he    knew   had   connections    with   the     forum.   The

plaintiff "cannot be the only link between the defendant and the

                                         99                               A-0963-12T1
forum." Id. at 14, 134 S. Ct. at 1122, 188 L. Ed. 2d at 21. It

is   "the    defendant's       conduct      that       must       form   the     necessary

connection       with   the   forum   State    that       is      the    basis    for   its

jurisdiction over him." Ibid. As stated in Burger King, supra,

471 U.S. at 478, 105 S. Ct. at 2185, 85 L. Ed. 2d at 544-45,

"[i]f the question is whether an individual's contact with an

out-of-state party alone can automatically establish sufficient

minimum contacts in the other party's home forum, we believe the

answer clearly is that it cannot."

      In Walden, supra, 571 U.S. at 15, 134 S. Ct. at 1122, 188

L.   Ed.    2d    at    21,   the   Court    found,          in    searching      for   the

"necessary connection" between the nonresident's conduct and the

forum, no such link even though the defendant in Georgia might

have known that the plaintiffs could have felt the impact of his

conduct in the forum. On the other hand, in an earlier case, the

Court found a sufficient nexus when Florida defendants published

an   allegedly      libelous    article      about       a     California        plaintiff

knowing     their       publication      had       a     subscription            base     of

approximately 600,000 readers in California. Calder v. Jones,

465 U.S. 783, 785, 104 S. Ct. 1482, 1485, 79 L. Ed. 2d 804, 809-

10   (1984).      The   principles    emanating          from       these      cases,   and

others, direct that we first determine whether those defendants

seeking to justify the dismissal based on personal jurisdiction

                                         100                                      A-0963-12T1
had minimum contacts with New Jersey and, if so, whether those

contacts represented deliberate attempts by those defendants to

avail themselves of the forum. Lebel, supra, 115 N.J. at 322-24.

      With      respect    to       the   first        question     –    whether        these

defendants had minimum contact with New Jersey — plaintiffs rely

heavily    on    their    position        that      the   in-forum      contacts        of    a

co-defendant      can,    as    a    matter      of    law,   be    imputed      to     other

purported enterprise members by applying conspiracy or agency

theories of liability. Although accepted in some courts, see

Compania     Brasileira        Carbureto       De      Calicio     v.   Applied       Indus.

Materials Corp., 640 F.3d 369, 372 (D.C. Cir. 2011); Melea, Ltd.

v. Jawer Sa, 511 F.3d 1060, 1069 (10th Cir. 2007); Lolavar v. De

Santibanes, 430 F.3d 221, 229 (4th Cir. 2005); Textor v. Board

of Regents of N. Ill. Univ., 711 F.2d 1387, 1392-93 (7th Cir.

1983), even those jurisdictions recognize that the theory might,

at   times,     "subvert       the    due   process       principles          that    govern

personal     jurisdiction,"          Newsome      v.   Gallacher,       722 F.3d 1257,

1265 (10th Cir. 2013). Other courts have rejected the theory.

See Ploense v. Electrolux Home Prods., 882 N.E.2d 653, 665-67

(Ill. App. 2007); OpenRisk, LLC v. Roston, 59 N.E.3d 456 (Mass.

App. 2016); Nat'l Indus. Sand Ass'n v. Gibson, 897 S.W.2d 769,

773 (Tex. 1995). One commentator has argued that its use is

unconstitutional:

                                            101                                      A-0963-12T1
             [B]efore [a court] may properly assert
             jurisdiction, [it] must find actual or
             constructive knowledge on the part of each
             defendant that the conspiracy could lead to
             the kind of significant contact with the
             state that would support jurisdiction. It
             cannot rely on a conspiracy "theory" to hold
             every    individual   defendant    to    the
             expectation of a particular forum simply
             because one of the alleged co-conspirators
             happened to choose that state as the place
             to perform an act.

                 . . . .

             [I]nsofar as conspiracy theory becomes a
             device to bypass due process analysis, it is
             plainly unconstitutional.

             [Ann Althouse, The Use of Conspiracy Theory
             to Establish In Personam Jurisdiction: A Due
             Process Analysis, 52 Fordham L. Rev. 234,
             253-54 (1983).]

See   also   Rhett     Traband,   The    Case   Against   Applying    the     Co-

Conspiracy     Venue    Theory    in    Private   Securities     Actions,      52

Rutgers L. Rev. 227, 262 (1999) (criticizing this conspiracy

approach because of its tendency to rely on "self-serving and

often   conclusory     allegations,"      and   because   it   can   result    in

subjecting a nonresident to "expedited and broad discovery," and

the expenditure of funds "to defend in a forum with which the

defendant had no contact"); Stuart Riback, Note, The Long Arm

and Multiple Defendants: The Conspiracy Theory of In Personam

Jurisdiction, 84 Colum. L. Rev. 506, 521 (1984) (concluding that

"the conspiracy theory does not take into proper account the

                                        102                            A-0963-12T1
International Shoe requirements [and] leads to undesirable and

often unconstitutional results").

       Plaintiffs mistakenly rely on State, Department of Treasury

v. Qwest Communications International, Inc., 387 N.J. Super. 487

(App.     Div.   2006),       in    support       of    this     theory.    There,     the

plaintiff      sued    Qwest   and    its     executive        officers    for   damages

incurred when they allegedly conspired to inflate the price of

Qwest's     stock.      Id.    at    493-94.       The     plaintiff       accused     the

individual defendants, who were executive officers responsible

for approving defendant's financial statements for filing with

the     SEC,     of     intentionally         disseminating         false     financial

statements through the company's investor relations division as

an    inducement      to   invest.     Id.    at       501-02.    Those    nonresidents

disputed personal jurisdiction on the ground that they had not

known the company's investor relations division would transmit

the   disputed        information     to    New    Jersey      investors.     Ibid.      We

rejected       the      nonresidents'         "individual          protestations        of

ignorance," recognizing "that a 'conspiracy theory' of personal

jurisdiction is based on the 'time[-]honored notion that the

acts of [a] conspirator in furtherance of a conspiracy may be

attributed to the other members of the conspiracy.'" Id. at 503

(quoting Textor, supra, 711 F.2d at 1392-93).

                                            103                                  A-0963-12T1
    Even       assuming        this          language      was    an     endorsement        of

conspiracy-based              personal               jurisdiction,             Qwest         is

distinguishable. There, "[t]he crux of the cause of action [was]

the dissemination of fraudulent statements into this State that

caused harm to NJT," a division of New Jersey's Department of

Treasury.      Id.    at     499.      The    three     individual       defendants      "all

signed    filings      with       the    SEC     that      included      allegedly      false

statements that induced NJT to purchase and hold Qwest stock.

NJT received in New Jersey specific notice of those filings and

accompanying         press    releases         from     Qwest's    investor         relations

division that included statements from all three defendants."

Id. at 501. We found it reasonable to infer that the defendants

were aware of this system of dissemination to major investors

such as NJT. Id. at 502. Thus, it was a reasonable "inference

and imputation of knowledge that the investor relations division

would transmit the false statements to" NJT in New Jersey. Id.

at 504.

    Here, by contrast, the crux of this alleged conspiracy was

the dissemination of false statements to affect the financial

markets   in    New     York      in     order    to    cause     harm    to    a    Canadian

corporation.     These        defendants         did    not     make    statements       their

alleged     co-conspirators                  distributed         into      New         Jersey.

Importantly,     there       is     no    basis      for   an    inference      that     these

                                               104                                   A-0963-12T1
defendants were aware of any particular actions taken by their

alleged co-conspirators in New Jersey. See Glaros v. Perse, 628
F.2d 679,     682   (1st    Cir.         1980)     (holding   that   the    conspiracy

theory of personal jurisdiction requires that "the out-of-state

co-conspirator        was    or    should        have   been    aware"   of    the    acts

performed in the forum state in furtherance of the conspiracy);

Althouse, supra, 52 Fordham L. Rev. at 253 (observing that "a

court must find actual or constructive knowledge on the part of

each defendant that the conspiracy could lead to the kind of

significant       contact         with         the    state     that   would    support

jurisdiction").

       Absent such evidence, we reject the blanket rule urged by

plaintiffs      in    favor       of       a    defendant-by-defendant         approach.

Blakey, supra, 164 N.J. at 66; see also Lebel, supra, 115 N.J.

at     321-22     (rejecting           a       "'stream-of-commerce'         theory     of

jurisdiction" and opting to "stay with the basics"). Indeed, in

other cases involving multiple defendants, our Supreme Court has

warned that

              if a suit contains multiple defendants,
              their individual contacts to the forum state
              cannot   be  aggregated   to   find  minimum
              contacts for a single defendant. Similarly,
              jurisdiction over one defendant may not be
              based   on   the   activities    of  another
              defendant, nor on the plaintiff's connection
              to the forum state.     The requirements of
              minimum contacts analysis "must be met as to

                                               105                              A-0963-12T1
              each defendant over whom                    a     state    court
              exercises jurisdiction."

              [Waste Mgmt., supra, 138 N.J. at 127
              (quoting Rush v. Savchuk, 444 U.S. 320, 332,
              100 S. Ct. 571, 579, 62 L. Ed. 2d 516, 527
              (1980)).]

In applying this standard, we must reject plaintiffs' claims

that     courts     may    assert       personal          jurisdiction         over      these

defendants      based     solely        on    actions         that     other    defendants

allegedly     committed        within     New      Jersey      absent     evidence       these

defendants      knew      or     should      have       known       their     alleged       co-

conspirators would take action in this State.

       Plaintiffs have referred to a variety of emails and text

messages exchanged between the defendants who obtained dismissal

for    lack    of    personal        jurisdiction             and     other    defendants.

"[C]ommunications with individuals and entities located in New

Jersey     alone,"        however,        constitute           "insufficient          minimum

contacts to establish personal jurisdiction over a defendant."

Baanyan Software Servs., Inc. v. Kuncha, 433 N.J. Super. 466,

477 (App. Div. 2013). More importantly, the communications that

plaintiffs        highlight       consist          of     information-sharing               and

speculation       about    the    profitability           of     Fairfax's      securities

exchanges.     There      was    nothing        objectively           actionable      in    the

substance      of   the    communications            in       which    these    defendants

participated. Plaintiffs' claims otherwise are based entirely on

                                             106                                      A-0963-12T1
speculation and innuendo and are wholly distinct from Qwest,

supra,   387    N.J.      Super.   at    500,     where     the   "gravamen       of    the

conduct alleged [was] the communication" itself. At best, any

discussions     among      these    defendants       were       "peripheral       to    the

conspiracy     alleged"      and    do     not    form     grounds    for    exercising

personal jurisdiction. Id. at 503.

     Apart from plaintiffs' inability to show that the Kynikos

and Third Point defendants had significant contacts with New

Jersey, plaintiffs have not shown that whatever limited contacts

these defendants may have had with New Jersey were sufficiently

"purposeful" to impose jurisdiction. Plaintiffs were required to

demonstrate that the contacts of these nonresidents with New

Jersey resulted from deliberate conduct. Lebel, supra, 115 N.J.

at 322-24 (citing World-Wide Volkswagen Corp. v. Woodson, 444
U.S. 286, 297-98, 100 S. Ct. 559, 567-68, 62 L. Ed. 2d 490, 501-

02   (1980)).       The    goal     of     that    requirement        is     to     ensure

predictability       and    to    shield    parties      from     being     "haled     into

court in a foreign jurisdiction solely on the basis of random,

fortuitous,     or     attenuated        contacts     or    as    a   result      of    the

unilateral activity of some other party." Waste Mgmt., supra,

138 N.J. at 121.

     Plaintiffs claim that these defendants purposely availed

themselves     of    New   Jersey's      benefits        because,     in    their    view,

                                           107                                    A-0963-12T1
defendants knew any harm to Fairfax would have a "cascading

effect" that would extend to its subsidiaries, including the New

Jersey-based C&F. Kynikos and Third Point's respective trading

activities,        however,     belie    plaintiffs'       allegation       that    they

specifically         targeted    C&F.    In   fact,    Kynikos      never    held    any

investments in C&F. Third Point extensively traded securities

related to Fairfax and many Fairfax's subsidiaries, but trades

specific      to     C&F     amounted   to    only    three   percent        of    those

transactions.

      Further, the bonds underlying those C&F trades were issued

by Crum & Forster Funding Corp., a Delaware corporation, and

then assumed by C&F. These facts are significant when viewed

through the lens of the generally-accepted principle that the

situs of intangible interests, like stock, is usually the state

in which the entity is incorporated. State v. Garford Trucking,

Inc.,     4 N.J. 346,    351-53    (1950).   Because     the    bonds    in    this

matter were issued by out-of-state entities, they arguably never

found themselves within New Jersey's borders. Thus, Third Point

could not have "reasonably anticipate[d] being haled into court"

in New Jersey based on C&F's assumption of the bonds. World-Wide

Volkswagen, supra, 444 U.S. at 297, 100 S. Ct. at 567, 62 L. Ed.
2d   at   501.     Although     relevant,     even    if   those    bonds    could   be

deemed to have entered New Jersey, the mere presence of Third

                                          108                                 A-0963-12T1
Point's     property    in   New       Jersey,      standing       alone,    does    not

establish jurisdiction; plaintiff was required to identify other

facts to show minimum contacts. Shaffer v. Heitner, 433 U.S.
186, 209, 97 S. Ct. 2569, 2582, 53 L. Ed. 2d 683, 701 (1977);

Appaloosa    Inv.,     L.P.I.    v.    J.P.      Morgan    Sec.,    Inc.,     398    N.J.

Super. 52, 58 (App. Div. 2008). Given the number of Fairfax-

related entities in which Third Point traded, the transactions

involving C&F are not significant; that Third Point's trading of

C&F-related    interests        represented       only     three    percent     of   its

overall Fairfax holdings, and that those trades involved bonds

that at the time of purchase were issued outside the state,

defeat plaintiff's claim that Third Point set out to harm C&F.

    Focusing on C&F's lost customers does not alter the result.

There is no more evidence that those relationships were targeted

through   specific      conduct       in   New    Jersey    or     that     defendants'

conduct was geared toward causing an effect in New Jersey than

there was in Walden, where the defendant's conduct in Georgia

interfered with the plaintiffs' possession of money they brought

with them on a flight from Puerto Rico to Georgia, with                               an

intention     to   travel    on       to   either     of    their     residences      in

California and Nevada:

            [Plaintiffs'] claimed injury does not evince
            a connection between [defendant] and Nevada.
            Even if we consider the continuation of the
            seizure in Georgia to be a distinct injury,

                                           109                                 A-0963-12T1
         it is not the sort of effect that is
         tethered to Nevada in any meaningful way.
         [Plaintiffs] and only [plaintiffs] lacked
         access to their funds in Nevada not because
         anything independently occurred there, but
         because Nevada is where respondents chose to
         be at a time when they desired to use the
         funds seized by [defendant]. . . . Unlike
         the broad publication of the forum-focused
         story    in   Calder,    the    effects   of
         [defendant's] conduct on [plaintiffs] are
         not connected to the forum State in a way
         that makes those effects a proper basis for
         jurisdiction.

         [Walden, supra, 571 U.S. at 23, 134 S. Ct.
         at 1125, 188 L. Ed. 2d at 23-24.]

    Mere "random" and "attenuated contacts" with New Jersey are

insufficient.   Waste   Mgmt.,   supra,   138   N.J.   at   121;   Baanyan,

supra, 433 N.J. Super. at 475. Plaintiffs rely on the fact that

C&F was a facet of Fairfax's consolidated financial statements

in arguing that an attack on one entity was an attack on another

or all. But they also recognize that harm to C&F was a byproduct

and "cascading effect" of Fairfax's injuries. Therefore, unlike

Qwest, supra, 387 N.J. Super. at 503, where there was a direct

link between the defendants' financial misrepresentations and

the impact to the New Jersey plaintiff, the harm to C&F, and

thus to New Jersey, was largely derivative of that to Fairfax.

Plaintiffs cite to authorities which are inapposite because in

those cases the defendants knew their conduct would have a New

Jersey impact. See Blakey, supra, 164 N.J. at 46 (finding "that

                                  110                              A-0963-12T1
defendants who published defamatory electronic messages, with

knowledge that the messages would be published in New Jersey and

could influence a claimant's efforts to seek a remedy under New

Jersey's Law Against Discrimination, may properly be subject to

the   State's      jurisdiction");    Lebel,      supra,      115   N.J.   at    320

(considering that the defendant actively solicited the business

of a New Jersey plaintiff); Goldhaber v. Kohlenberg, 395 N.J.

Super.     380,    389-90   (App.   Div.    2007)      (recognizing    that      the

defendant "not only knew that plaintiffs resided in New Jersey,

he knew the municipality in which they resided and made specific

disparaging       references   to   that    municipality       in   many   of    his

postings"); cf. Matsumoto v. Matsumoto, 335 N.J. Super. 174,

180-85 (App. Div.) (holding there was no personal jurisdiction

over a foreign national who helped her son in an out-of-state

conspiracy to violate his former wife's custody rights under

their New Jersey divorce decree, even if she had retained title

to the New Jersey marital home), aff'd in part, mod. in part on

other grounds, 171 N.J. 110 (2000).

      In   many    ways,    plaintiffs     seek   to   base    jurisdiction      for

their claims against these defendants on the in-forum contacts

of plaintiff's own subsidiary, C&F. By this logic, defendants

would be subject to jurisdiction in any forum in which plaintiff

had a subsidiary. Imposing jurisdiction on such "random" and

                                      111                                  A-0963-12T1
"fortuitous"         grounds        would     undermine         the        due      process

considerations on which the minimum contacts analysis is based.

See Waste Mgmt., supra, 138 N.J. at 121; see also Kulko v.

Superior Ct. of Cal., 436 U.S. 84, 93-94, 98 S. Ct. 1690, 1698,

56   L.   Ed.   2d   132,     142   (1978).       Indeed,      such   an     exercise     of

personal      jurisdiction      is     precluded         by    well-established          due

process principles. Walden, supra, 571 U.S. at 15, 134 S. Ct. at

1122, 188 L. Ed. 2d at 21 (holding that "plaintiff cannot be the

only link between the defendant and the forum").

                                      4. Summary

      There     being    no    grounds       for    the       assertion      of    general

jurisdiction,        plaintiffs       were    required         to     demonstrate,        in

support of the exercise of specific jurisdiction or in support

of   their    conspiracy-based        theory       of    jurisdiction,        that    these

defendants "purposefully availed [them]sel[ves] of the privilege

of   engaging    in     activities      within          the   forum    state,      thereby

gaining the benefits and protections of its laws." Waste Mgmt.,

supra, 138 N.J. at 120-21. For the reasons we have discussed, we

conclude      that    these     defendants         could      not     have       reasonably

anticipated "being haled into court in a foreign jurisdiction

solely on the basis of [the] random, fortuitous, or attenunated

contacts" asserted here. Id. at 121.

                                            112                                    A-0963-12T1
    We affirm the dismissal of the                       Kynikos and Third Point

defendants on personal jurisdiction grounds.

                                              D

                           THE SUMMARY JUDGMENTS
                      IN FAVOR OF THE SAC DEFENDANTS
                        AND THE ROCKER DEFENDANTS

    Plaintiffs        also      contend       that    the     trial       court      erred       in

granting summary judgment to the SAC defendants and the Rocker

defendants.      We view these matters separately.

                                1. The SAC Defendants

                           (a) The Parties' Arguments

    In      granting       summary          judgment     in     favor          of        the    SAC

defendants, the trial court concluded that SAC had not engaged

in short-selling Fairfax equity securities and would actually

"stand     to   lose"      money       if     the     alleged        scheme         succeeded.

Plaintiffs,     however,        rely   on     evidence      that      suggests           the    SAC

defendants      worked     with    enterprise         members       to    try       to    find     a

negative    catalyst       to    drive      Fairfax's       stock     price         down,      and,

after     receiving      non-public          information        of       the    anticipated

adverse    report     by     Morgan         Keegan,    Cohen        and    Sigma          Capital

Management, L.L.C., maintained or added to their short positions

in Fairfax so they could profitably cover the stock price drop

that would result when that report became public.                                   Plaintiffs

                                             113                                          A-0963-12T1
assert the record further shows the SAC defendants continued

participation in the conspiracy in 2003 to 2006, well beyond the

initial    acts,   by     increased   investments    in    Exis.    In   general,

plaintiffs claim the trial judge erred in failing to give them

the benefit of all favorable inferences regarding these facts,

and, in that way, assumed or usurped the jury's fact-finding

role.

       The SAC defendants argue that, unlike the other defendants

that conceded trading in or communicating about Fairfax, they

denied "any significant trading in Fairfax securities or having

worked with or even communicated with the other [d]efendants

regarding    Fairfax."      They    reject    plaintiffs'    characterization

that     Contogouris       admitted    a     relationship     with       the    SAC

defendants,      noting    that    Contogouris's    testimony,      in   context,

constituted a denial that he spoke with defendant Cohen about

Fairfax.

       The SAC defendants also argue that, for the entirety of the

alleged    conspiracy,      its    economic    interests    in     Fairfax     were

"either neutral or aligned with Fairfax's," a circumstance that

would conclusively demonstrate they "had no economic interest in

seeing     the   so-called     conspiracy     succeed."     SAC    invested       in

Fairfax prior in time to when plaintiffs allege the conspiracy

began; SAC was closing that short position in early 2003, and by

                                       114                                A-0963-12T1
mid-September 2003 had "completely closed" its short position in

Fairfax.     A    long-position             purchase    in      2004     aligned      SAC's

interests with Fairfax and, therefore, contrary to the purposes

of the alleged conspiracy. SAC had no position in Fairfax in

2005,      and        considered       its         subsequent       short        positions

inconsequential.         And,    to    the    extent    SAC     invested     in    outside

entities, such as Exis and Bridger Capital Management, which

both had invested in Fairfax, the SAC defendants assert these

were    inconsequential,              and     they      denied       control       of      or

communications about them with anyone relevant to the alleged

conspiracy.       The    SAC    defendants          therefore    contend     plaintiffs

failed to meet their burden of showing that they "purposefully

and knowingly" engaged in a conspiracy, supported by permissible

inferences       in     plaintiffs'         favor    that    were      not   "inherently

implausible," and that the trial judge was correct in dismissing

the claims asserted against the SAC defendants.

                          (b) The Trial Judge's Ruling

       The trial judge agreed with the SAC defendants' view. In

September 2011,         the    judge    determined       that     although       over    200

"disputed facts" were presented, "there really appears to be

nothing    more       than    broad    speculation       based      on   circumstantial

evidence" and plaintiffs failed to suggest "any inferences based

upon    reasonable           facts    and     evidence"       that       would     suggest

                                             115                                   A-0963-12T1
otherwise. The judge, instead, believed plaintiffs had "tr[ied]

to distort the record in an attempt to create their speculative

assertions," and concluded that "the evidence on record is not

enough   to    support    a   rational    finding      that    whatever       disputed

issues   are    alleged    by     plaintiffs,    can    be    found    in     favor   of

Fairfax." The court recognized that New Jersey's RICO and civil

conspiracy laws can be viewed with leniency, allowing for some

inferences     because     activities     may    have      taken      place    "behind

closed doors," but basing a case entirely "on pure speculation

is too big of a leap to take." The trial judge added:

              Plaintiffs   have   pointed  to   no  direct
              evidence which establishes a conspiracy of
              which SAC was a part. . . . Most tellingly,
              is   SAC's   trading   reports   in  Fairfax
              securities. The fact that at no time did SAC
              trade similarly to its alleged [e]nterprise
              [m]embers    is   baffling,    and   without
              explanation by plaintiffs. It does not make
              sense that the alleged leader of the
              conspiracy would not only NOT act as its
              alleged cohorts did, but in fact, stand to
              lose money as a result of the allege[d]
              conspiracy.

    Finding      "no     direct    evidence     of   any     sort     of    conspiracy

involving SAC to take down Fairfax, and any allegation of such,"

viewing plaintiffs' allegations as "too much speculation based

on circumstantial evidence to get past summary judgment," and

concluding "[t]here is simply no evidence of motivation of [the]

                                         116                                   A-0963-12T1
SAC    [defendants]     to     participate,     much     less   coordinate       the

'conspiracy,'" the judge granted summary judgment.

                                   (c) Our Holding

       We disagree.        The judge was presented with a forty-eight

page list of the statement of items relevant to the motion. To

be sure, mere quantity will not tilt the scale, but summary

judgment is "too fragile a foundation," Grow Co. v. Chokshi, 403

N.J.   Super.    443,   470     (App.   Div.   2008)     (quoting     Petition    of

Bloomfield S.S. Co., 298 F. Supp. 1239, 1242 (S.D.N.Y. 1969),

aff’d, 422 F.2d 728 (2d Cir. 1970)), for a disposition on the

merits here. Indeed, there are assertions in the factual record

that   raise     genuine      issues    regarding    the    claim     of   the   SAC

defendants' participation in the scheme as to preclude summary

judgment regardless of the extraordinary size of the record.

       The expert opinion submitted by plaintiffs could support a

factfinder's determination that SAC took certain short positions

that     gave    it    financial       goals   aligned      with    the    alleged

conspiracy.      In a certification submitted in response to the SAC

defendants'      motion,      plaintiffs'      expert,      Stanley    Fortgang,46

opined    that   SAC    had    a   "substantial     known   short     interest    in

46Fortgang was a consultant with approximately twenty-five years
experience trading equities, bonds, and other securities for
securities firms and hedge funds.

                                         117                               A-0963-12T1
Fairfax     throughout       the    duration      of    the     conspiracy           and     a

significant financial incentive to have acted in concert with

other defendants and enterprise members in furtherance of the

conspiracy."       He    also      explained      that        the       SAC    defendants

"collaborated with other defendants and enterprise members with

respect to their trading in Fairfax in order to depress the

price of Fairfax stock, and profit from its short positions."

These     bald    assertions       were   not     enough       to       defeat      summary

judgment,    but   Fortgang        observed     that,    in    moving         for   summary

judgment, the SAC defendants

            conveniently ignore[] trading in Fairfax's
            related entities, specifically Odyssey . . .
            under the ticker symbol ORH. However, the
            ledger of ORH trades shows that [SAC] held a
            short position in ORH during April 2002,
            from June 2002 through February 23, 2004
            (excepting for 2 distinct periods totaling
            approximately 30 days) and from July 2005 to
            September 2006 (except for a 15 day period
            from late July through early August 2006).

    Fortgang explained that the "stock price of Fairfax and

Odyssey     are    directly        related      such    that        a    conspiracy        to

manipulate the price of Fairfax could certainly include trading

in ORH." He further found it "significant enough to justify its

conduct" in the alleged conspiracy that SAC held a significant

interest in outside funds including Exis and Bridger.                               SAC was

Exis's largest investor and, through Exis, indirectly possessed

short   positions       in   Fairfax.     And,     according            to    Contogouris,

                                          118                                       A-0963-12T1
Exis's    "head    analyst,"      defendant     Steven   Cohen      had       frequent

communications with him.

    Fortgang explained how this could be significant even where

SAC's    actual    trading    activity     differed    from   the    activity        of

other defendants:

            [SAC] is well known in the marketplace for
            having   a   unique  and   distinct   trading
            strategy more focused on short term gains
            than other [d]efendants. It is therefore
            reasonable to conclude that while pursuing
            its own trading strategy, [SAC] traded in
            collaboration with the enterprise despite
            the fact that their trading records are not
            identical to other enterprise members[].

    He added that the trading records showed that SAC "was

certainly involved in trading on specific days and in the same

direction as other defendants" and that the record further shows

that many of those trades occurred "at times when significant

communication occurred among the enterprise members." Fortgang

further alluded to the fact that the SAC defendants' expert

focused    only    on   whether    there      was   coordination      with       other

defendants and enterprise members "over long periods of time,"

noting that instead SAC could have chosen to "coordinate[] its

trading    at     specific    critical       time   periods."    SAC's         trading

approach        was,    nevertheless,         "consistent     with        a      stock

manipulation      scheme     designed   to    profit   from   the    artificially

depressed price of [Fairfax] and [Odyssey] stock . . . ." Even

                                        119                                   A-0963-12T1
SAC's trading expert, Denise Martin, "concedes that a possible

short   strategy       to    take    advantage    of   an    anticipated   negative

event could be . . . to cover a short position in advance of

that event after the anticipation of that event has already had

an effect on the stock price."

       These contentions are further illuminated by SAC's guilty

plea    to   a   2013       federal      indictment,    in   which   SAC   admitted

widespread solicitation and use of illegal inside information

and insider trading, for which it agreed to pay an aggregate

financial penalty of $1.8 billion and agreed to terminate the

investment advisory businesses of several named SAC entities.47

Although     this      settlement         occurred     in    November   2013,       the

stipulation      and    order       of   settlement    recites   that   the    period

during which insider trading took place was between 1999 through

at least in or about 2010, thus including the period relevant to

plaintiffs' allegations.

       Plaintiffs'      statement         of   material      facts   submitted       in

response to the SAC defendants' motion, includes numerous pages

citing to and quoting documents describing SAC's early shorting

of Fairfax in late 2002, its coordination with other alleged

47 United States v. S.A.C. Capital Advisors, L.P., 13 Cr. 541
(LTS), 13 Civ. 5182 (RJS) (S.D.N.Y. Nov. 2013), available at
https://www.justice.gov/usao-sdny/pr/sac-capital-management-
companies-plead-guilty-insider-trading-charges-manhattan-
federal?print=1.

                                            120                               A-0963-12T1
enterprise       members         regarding     Fairfax        and    the       need     for    a

"catalyst" for short sellers, and its involvement in contacting

analysts and reporters with an intent to trade ahead of negative

articles. Citing to emails and SAC trading ledgers, plaintiffs

claimed that SAC and its Bridger Capital account shorted in

advance of an expected Canadian Imperial Bank of Commerce report

by    Quentin    Broad      on     Fairfax,    and      SAC's     Sigma    account       began

covering when it appeared that Broad's report would be delayed,

but     it    then     began       "reshorting        those     covered        shares    after

learning about the imminent publication of the Gwynn report,"

covering at least 500 shares "at a drastically lower price –

near the low of the day – after Gwynn published his report."

       Plaintiffs further described various contacts between SAC

representatives         and        Morgan   Keegan,        including       a     request      in

September       2003    for    a    reminder     of    what     Gwynn     had    said    about

Fairfax's       use    of   finite     insurance.          Plaintiffs      also      cited    to

SAC's $48 million interest as of May 2004 in Exis's Walrus Fund,

Exis's       employment       of    Contogouris       in    March    2005       to    work    on

Fairfax, and the fact that Steven Cohen knew Contogouris from

his     prior    experience          with    him      on    the     Hanover       Compressor

investment as to which defendant Cohen took a short position

based    on     insider       information      from        Contogouris.         Accordingly,

plaintiffs relied on Contogouris's assertion that in the spring

                                             121                                      A-0963-12T1
of   2006,       SAC     "called     Sender     and     wanted    some     of    .    .    .

[Contogouris's]          research."       Based   on     the   information       gleaned

through Contogouris's work on behalf of the alleged enterprise,

plaintiffs were entitled to an inference that the SAC defendants

were able to reap "substantial profitable returns from massive

short positions that S.A.C.-related funds had assumed in Fairfax

. . . ."

      Plaintiffs also asserted that, although the SAC defendants

"attempt[] to narrowly interpret the relevant trading activity

in   an   effort       to    minimize     the   extent    of     its    involvement       in

trading Fairfax securities, the trading records produced by the

[SAC]     [d]efendants           show    thousands      of     trades     in    Fairfax,

including short trades that are not individually reflected in

the [Fairfax] Ledger." Additional extensive trading was seen in

Odyssey shares, and in options trades with Fairfax's stock – a

lower     cost    way       to   "synthetically       short    Fairfax."       Plaintiffs

asserted       that    although     SAC    at   times    "took     smaller      and   more

short-term positions than other defendants, it often traded on

the same days and in the same directions as those defendants,"

citing     a     March      2006   SAC    short   position       taken    in    Fairfax.

Consequently,            plaintiffs        contend       the       trading       records

"demonstrate the opposite of what they have stated" in moving

for summary judgment.

                                            122                                  A-0963-12T1
       Considering     that       the    matter     was    disposed       of   by   way    of

summary judgment, and considering that we, too, are obligated to

apply the Brill standard, see, e.g., Murray v. Plainfield Rescue

Squad, 210 N.J. 581, 584 (2012), we conclude there are genuine

factual disputes that precluded summary judgment. We agree with

plaintiffs that the trial judge overlooked or otherwise resolved

material factual disputes about SAC's trading during the period

of the alleged enterprise. To be sure, at the conclusion of a

trial,    the      factfinder       could     choose           to     reject   Fortgang's

conclusions and find plaintiffs' interpretations of the facts

less    credible     than    others      it   may       hear,       Poliseno   v.   General

Motors    Corp.,     328    N.J.    Super.        41,     59    (App.    Div.),     certif.

denied,    165 N.J. 138    (2000),     but       for     purposes      of   summary

judgment, plaintiffs were entitled to the benefit of the doubt

on those matters.

                            2. The Rocker Defendants

                           (a) The Parties' Arguments

       Plaintiffs contend that, in granting summary judgment to

the    Rocker    defendants,       the    judge     erred       because     judgment      was

granted years before discovery was completed – indeed, before

any depositions were taken – and because the judge relied on the

opinion    of    a   discovery          master,     who,        in    plaintiffs'      view,

improperly resolved disputed factual issues and incorporated his

                                           123                                      A-0963-12T1
personal view of how securities markets operate in concluding

that "Rocker's quick reaction to the negative report it received

about Fairfax is hardly out of the ordinary." That conclusion

purported to resolve disputed questions about when the Morgan

Keegan report was officially published, when Rocker traded, and

what       inferences     could        be     drawn     from     the     "speed       and

aggressiveness" of Rocker's trades at and around the time of the

report's publication.

       A   discovery     master       found   that    Rocker    began    trading      ten

minutes      after    receiving       word    about   the     report,    and    without

having seen the report. Plaintiffs contend these facts supported

an inference that the Rocker defendants had prior knowledge of

the report and the further inference that they were engaged in

the conspiracy.         Moreover, plaintiffs assert that the discovery

master relied upon an in camera review of Rocker's detailed

trading records, which plaintiffs were not permitted to see and

thus   could    not     test.    Plaintiffs        additionally    argue       that   the

trial judge erred by improperly limiting the relevant issues for

Rocker's participation in the conspiracy to just two events: (1)

paying      Contogouris,        and    (2)    trading    in    advance     of    Morgan

Keegan's initial January 2003 report.

                                             124                                A-0963-12T1
                         (b) The Trial Judge's Ruling

       To be sure, the resolution of the claims against the Rocker

defendants was unusual. In considering dispositive motions in

2007, the trial judge stated a number of times: "I still don't

know   what     the    Rocker   defendants   did."   She   asked   plaintiffs'

counsel how quickly he could depose David Rocker if the motion

to dismiss were to be denied, and counsel responded he could

perhaps address the issue with more specific pleading, which was

to be accomplished within two weeks, if needed. In clarifying

and restating what would occur next, the trial judge stated that

she    would    deny    Rocker's   motion,   without   prejudice,    and   that

plaintiffs' and Rocker's counsel should talk. The judge added:

               If you haven't been able to work it out,
               he's going to amend the complaint. Yours is
               going to be the first deposition, and you
               can re[-]move . . . and . . . incorporate
               the papers that you've already submitted,
               with just . . . a summary brief on what
               happened as far as the new pleading, and –
               I'm trying to make it as inexpensive as
               possible.

       The   Rocker     defendants   again   moved   for   dismissal   because

plaintiffs did not avail themselves of the opportunity to depose

Rocker. At the beginning of the argument, the court set forth

the procedural background for the motion, specifically regarding

the assertion by plaintiffs' counsel that plaintiffs "haven't

had a chance to take the Rocker depositions." The trial judge

                                       125                             A-0963-12T1
stated "that's not accurate[,] . . . just simply not accurate";

she explained that, on September 7, 2007, "over a year ago, I

told the plaintiffs to take Mr. Rocker's deposition."

     The trial judge recalled having been "ready to dismiss them

on their motion to dismiss a year ago," but plaintiffs were

given the time they requested to get together documents which

would show a good faith basis for Rocker's continued inclusion

as   defendants.       The   judge    recalled      having   told    plaintiffs'

counsel "to share the evidence that they had with counsel for

that particular defendant and if they didn't have a good faith

basis for having them in the suit they should be dismissed." And

she added, that she "didn't expect them to have to come in here

and make another motion." More specifically, with regard to the

Rocker defendants, the judge expressed that she "was assured

that plaintiffs had a good faith basis, that somebody had given

them the information." And she then recounted that she "said, .

. . show them what it is, get it in the complaint, . . . and

take a deposition" so that only individuals and entities that

rightly belonged in the case would remain.

     At   the   motion's       conclusion,    the    judge   ruled      that:    "The

Rocker    defendants     are    going   to    be    dismissed    from    the     suit

without prejudice to an amended complaint being filed that comes

forth    with   some    specific     conduct."     The   judge   relied     on    her

                                        126                                A-0963-12T1
conclusion     that    the   proofs    of   any   wrongdoing    by    the     Rocker

defendants in December 2002 were "too slippery and too tenuous,"

and     were   further       attenuated      by     the   Rocker      defendants'

contentions that they engaged in no trading as to Fairfax in

December 2002 and had no Fairfax position until January 17,

2003.    The   trial    judge    was   further      troubled   by     plaintiffs'

failure to provide clear evidence as to when the Morgan Keegan

report was published, even though their arguments as to the

Rocker defendants assumed an afternoon publication on January

17, 2003.

      The judge's decision also acknowledged "there may very well

be reason[s] for bringing Rocker back into the complaint," if

the discovery master's review showed some culpability. At the

time, however, the judge found "there's really nothing" that

implicated the Rocker defendants and rejected an inference of

culpability     just    because    Rocker     and    Chanos    had    a   longtime

friendship.     As     to    plaintiffs'     allegation    that      Rocker     paid

Contogouris to do the things he did to hurt Fairfax, "if that is

so, there has to be something before March of 2007 to link

them," and the judge was shown no evidence of any such link.

      In December 2011, after the conclusion of discovery, the

trial judge converted the summary judgment to a dismissal with

prejudice, explaining that plaintiffs had failed to develop any

                                       127                                  A-0963-12T1
evidence     to    support      the    claims       asserted    against   the    Rocker

defendants.

                                     (c) Our Holding

      The     manner      in    which        the    action     against    the    Rocker

defendants was disposed of is foreign to us. The problem is that

the judge's "dismissal without prejudice" put the claims against

the Rocker defendants in the unusual position of being neither

in nor out, neither fish nor fowl. For these reasons, plaintiffs

have argued that summary judgment was prematurely granted and,

with no support, contend the Rocker defendants stonewalled them

on   discovery      before      a    discovery      master     could   look   into     the

issues they raised.

      It    is    clear    to   us    that    the    trial     judge   dismissed      with

prejudice only after plaintiffs had a full and fair opportunity

to obtain further discovery from the Rocker defendants and as to

their alleged involvement. Plaintiffs also have presented very

little about what they expected to find, so it all truly does

seem more like a fishing expedition. With the vast amount of

discovery available as it came from other parties, the trial

judge   was      not   unreasonable          in    believing    plaintiffs      had    not

sufficiently       shown    there      was    a    sound   basis   for    keeping      the

Rocker defendants in the case. With the completion of discovery

                                             128                                A-0963-12T1
years    later,       there    is    nothing        to    suggest     any   substance       to

plaintiffs' claims against the Rocker defendants.

       Consequently, we conclude that the trial judge did not err

in granting summary judgment to the Rocker defendants, and we

find plaintiffs' arguments to be without sufficient merit to

warrant further discussion in this opinion. R. 2:11-3(e)(1)(E).

                                              E

                                    LOST PROFITS AND
                                    THE ELSON REPORTS

       In   September     2012,       the     last       judge   to   preside    over      the

matter       addressed          the         maintainability           of      plaintiffs'

disparagement claim. The judge found sufficient evidence for a

jury to find that defendants had intended to harm plaintiffs'

interests;       he    further        found       those     interests       consisted       of

plaintiffs' "ability to sell their insurance policies," which

involved their "actual business dealings" rather than just their

reputations. Product disparagement, however, as we have held,

required proof of "special damages," and the trial judge ruled

that only one alleged kind of loss could satisfy it, namely,

C&F's injury from "products that were not sold." He concluded

that     plaintiffs'      general       financial          losses,     such     as    losses

arising from plaintiffs' offering of securities or the market

trading     in    their       securities,      were        the   indirect     results       of

                                              129                                    A-0963-12T1
defendants' disparagement rather than the "direct and immediate"

results of more targeted misconduct, and therefore could not be

included in the disparagement claim. The judge found the same

was   true    of     plaintiffs'       increased       auditing    costs     and    D&O

insurance premiums, plaintiffs' inability to finance strategic

acquisitions, and any legal costs. As a general matter, we agree

with this conceptualization.

      These    rulings        narrowed   the    alleged     cognizable       "special

damages"      to      C&F's     lost     customers.       Plaintiffs         proffered

Echemendia's in-house report that named approximately 180 lost

customers     from     whom     C&F    would    have    earned    profits      of   $19

million. Earlier, we concluded that plaintiffs' assertions as to

the   180    alleged     lost    customers      were     sufficient     to     survive

summary judgment. See Section IV(B)(3), supra.

      But plaintiffs also offered Craig Elson's expert report on

the value of the share of the insurance market that C&F would

have secured but for defendants' alleged misconduct. The trial

judge found Elson's expert report to be a net opinion, which

failed to show the special damages required by law, leaving only

the 180 lost customers named in Echemendia's report. As to those

customers, the judge found "a complete absence of proof that any

of the brokers in question actually made the decision . . . not

to    sell    [C&F]     insurance"       products      "based     on   the     alleged

                                          130                                 A-0963-12T1
statements," i.e., a failure of proof on proximate cause, which

compelled dismissal of what remained of plaintiffs' entire case.

       We reject the judge's determination that plaintiffs could

not    continue    to     pursue   its   claim    to   the   180   alleged    lost

customers for reasons already expressed, but we agree with the

argument that Elson's theory of recovery as to a lost market

share cannot constitute damages permitted by way of plaintiffs'

New York common law claims because New York law requires proof

of the specific customers whose present or future relationship

with plaintiffs was impinged, frustrated or precluded. It is for

this reason alone that we affirm the judge's determination to

bar the testimony Elson would have provided had the case gone to

trial.

       Although not necessary for our disposition of the appeal

concerning Elson's report, we nevertheless consider and address

other concerns about that report and Elson's proposed expert

testimony. The judge, as we have noted, barred Elson's expert

testimony because he found it to be a net opinion. Plaintiffs

additionally argue the trial judge erred in failing to conduct a

hearing pursuant to N.J.R.E. 104. We agree the judge erred in

finding Elson's proposed testimony constituted a net opinion but

we    find   no   error    in   the   judge's    decision    not   to   conduct    a

N.J.R.E. 104 hearing.

                                         131                              A-0963-12T1
                               1. General Principles

    N.J.R.E. 702 provides that when "scientific, technical or

other specialized knowledge will assist the trier of fact to

understand    the       evidence   or    to    determine     a   fact   in   issue,    a

witness qualified as an expert by knowledge, skill, experience,

training or education may testify thereto in the form of an

opinion or otherwise." Although the facts upon which a qualified

expert's testimony is based need not be admissible, those facts

must be "of a type reasonably relied upon by experts in the

particular    field       in   forming    opinions      or   inferences      upon    the

subject."     N.J.R.E. 703.        Consequently,         expert     opinions         must

satisfy three requirements:

            (1) the intended testimony must concern a
            subject matter that is beyond the ken of the
            average juror;

            (2) the field testified to must be at a
            state of the art such that an expert's
            testimony could be sufficiently reliable;
            and

            (3)   the   witness  must   have   sufficient
            expertise to offer the intended testimony.

            [Landrigan v. Celotex Corp., 127 N.J. 404,
            413 (1992).]

    A corollary of these principles — the net opinion rule —

forbids     the        admission    of        an   expert's      conclusions         when

unsupported       by     factual   evidence        or   other     data.      State     v.

                                          132                                 A-0963-12T1
Townsend,     186 N.J. 473,    494       (2006).     An    expert     witness     is

required "to give the why and wherefore of [an] expert opinion,

not just a mere conclusion." Jimenez v. GNOC, Corp., 286 N.J.

Super.    533,     540    (App.       Div.),      certif.     denied,    145 N.J. 374

(1996). The "key to admission" is the validity of the expert's

"reasoning       and     methodology,"         and    in    that     regard,    a   court's

function "is to distinguish scientifically sound reasoning from

that     of   the       self-validating           expert,      who     uses    scientific

terminology        to     present       unsubstantiated             personal    beliefs."

Landrigan, supra, 127 N.J. at 414.

                            2. The Judge's Disposition
                        Of the In Limine Motion Regarding
                             Elson's Expert Testimony

       Even   in       relatively      simple      cases,     determining       whether      a

proffered expert opinion passes the "why and wherefore" test

described above often proves difficult. On appeal, a dispute

about    admissibility          –    even   considering        an    appellate      court's

reticence in intervening absent an abuse of discretion, Hisenaj

v. Kuehner, 194 N.J. 6, 16 (2008) – can prove perplexing. See,

e.g., Townsend, supra, 221 N.J. at 53-57. And it doesn't get any

better    when     a    trial       judge   has      failed   to     fully    explain     the

grounds for exclusion; such is the case here.

       The trial judge found Elson lacked the requisite expertise

because, although highly educated, he did not possess experience

                                             133                                    A-0963-12T1
in   the    insurance          industry.      The      judge        also    deemed       Elson's

methodology to be unreliable by highlighting the lack of any

objective data or evidence to demonstrate a causal link between

an insurance company's rating and its market share growth. The

trial judge, however, did little more than express this view in

a conclusory fashion.

     On     the       return    date    of   an     in     limine     motion,          the   judge

provided only the following to guide us in determining whether

he soundly exercised his discretion. First, the judge stated

that "Mr. Elson is an MBA with no experience in the insurance

business     or       anything     relating       to     the     insurance        business      at

all[,] as is clear from his report and perfectly clear from his

testimony." The judge then referred to an obligation "in cases

of this kind" for a plaintiff – whether applying New York or New

Jersey     law    –     to   prove     "actual      loss    of      business."         The   judge

followed     that       with    an     acknowledgement           that      "New    Jersey      law

allows for an alternative approach when you can't prove . . .

actual     lost       business."     But,    because,          as   the    judge       observed,

"plaintiff        was    capable       of    proving       actual       loss      of    business

involving approximately 180 producers of business, who it claims

chose not to place insurance with [C&F] subsidiaries because of

the so-called noise or negativity in the market," he apparently

concluded that plaintiffs could not take an alternative approach

                                              134                                        A-0963-12T1
when    actual     lost       business    cannot     be     proven.     And       the    judge

lastly, through citation to some brief excerpts from Elson's

deposition      testimony,        found       Elson's     methodology        –    viewed     as

being    based      on    a     "proposition        that    because     companies           are

similarly rated by rating agencies and are similar in various

respects, that, therefore, they would have grown at the same

rate" – to constitute a theory that is "counterintuitive" and

"simply . . . not supported by any standard."

       The     judge's     brief       oral    decision      provides        little       that

demonstrates to us how – in this particularly complex aspect of

the case – the expert's opinion should be barred for theoretical

reasons. The judge's opinion does not demonstrate how Elson's

opinion is "counterintuitive" or unsupported by known standards.

       The judge stated at the outset of his oral decision that he

would "expand" on his reasoning by way of "a written opinion to

follow,"     but    that      written     opinion        never     issued.       If   Elson's

testimony was not barred because of the application of New York

law,     and       if     admissibility          turned       on     the         net-opinion

determination, we would simply remand for further amplification

from the trial judge on this question. But, in light of the

considerable time, expense and energy devoted to bringing the

case    to   this       point,    we   instead      have     analyzed      the        parties'

arguments      about      the    sufficiency        of     Elson's    credentials           and

                                              135                                     A-0963-12T1
methodology. Based upon our review of the record, we conclude

his     expert    testimony       did     not    constitute      one   or    more    net

opinions, although, as we have already mentioned, the damages

claimed by way of the Elson report are not recoverable.

                                    3. Our Ruling

       Elson     provided     two       detailed    expert       reports    that    were

explored at a lengthy deposition. In essence, he compared C&F's

sales    and     growth   rates     to    comparable     competitors.       Except    in

certain       respects    not     relevant       here,    the     admissibility       of

evidence is governed by the law of the forum. See Restatement

(Second), supra, § 138.

       Elson may not have previously provided an opinion of this

nature in the insurance setting – a fact greatly relied upon by

the trial judge48 – but that is not dispositive. See Quinlan v.

Curtiss-Wright Corp., 425 N.J. Super. 335, 372 (App. Div. 2012)

(observing that it "was not necessary for . . . a well-qualified

economist quantifying plaintiff's alleged losses [to also] be an

expert on employability"); see also Hammond v. Int'l Harvester

Co.,    691 F.2d 646,   652-53       (3d    Cir.    1982)    (holding    that   an

engineer, whose only qualifications were sales experience in the

48The trial judge held: "In order to give expert testimony . . .
you have to have knowledge, experience, training, something in
the area about which you're testifying. He has nothing with
respect to insurance, nothing at all."

                                           136                                A-0963-12T1
field of automatic and agricultural equipment and teaching high

school automobile repair, could testify in a products liability

action involving tractors); Knight v. Otis Elevator Co., 596
F.2d 84, 87-88 (3d Cir. 1979) (holding that an expert could

testify      that    unguarded    elevator       buttons   constituted         a    design

defect despite the expert's lack of a specific background in

design and manufacture of elevators). Although the determination

as     to    whether    our     evidence      rules     permit    admission           of    a

particular expert's testimony lies within the sound exercise of

the trial judge's discretion, see Hisenaj, supra, 194 N.J. at

16,    we    agree     the    trial   judge      mistakenly      rested    his        order

excluding Elson's testimony on Elson's lack of expertise in the

insurance industry. Any gaps in his conclusions about the damage

caused to C&F that were dependent on the jury's understanding of

the insurance industry could be supplied by other witnesses or

evidence, as N.J.R.E. 703 clearly permits. See, e.g., Indus.

Dev. Assocs. v. Commercial Union Surplus Lines Ins. Co., 222

N.J.    Super.      281,     296-97   (App.      Div.   1988).    Consequently,            we

conclude the trial judge mistakenly exercised his discretion in

excluding Elson's testimony solely on the basis of his lack of

expertise in the insurance industry.

       The    judge     also    excluded      Elson's      testimony      on       another

premise. The judge recognized that a plaintiff may prove damages

                                           137                                     A-0963-12T1
in this context without showing an "actual loss of business"

but, because plaintiffs were able to show the loss of business

from    approximately        180    producers        of       business,       they    could    no

longer take advantage of a looser standard for damages when the

claim is a loss of prospective business. We agree, as we have

already held, that a looser standard for damages is barred by

the application of New York substantive law to this claim.

       The trial judge lastly based his determination on Elson's

methodology. He said: "[t]here is nothing in his first report or

his    reply   report       that    supports        the       proposition      that    because

companies      are    similarly      related         by       rating    agencies       and    are

similar in various respects, that, therefore, they would have

grown at the same rate." Our review of the lengthy and detailed

reports   reveals      that     Elson     compared            C&F's    actual     performance

with the actual weighted average performance of peer companies

that    were     sufficiently           similar          to     provide       a      meaningful

comparison      for     the        benefit      of        the     factfinder.          Although

significantly more complex than other cases routinely heard and

considered     by     our   courts,      we    see       nothing       more    disqualifying

about    Elson's      methodology        than       we     would       with    an     appraiser

quantifying      an    injury      to   real        estate      through       comparison       to

another similar parcel of property, or in quantifying an injury

to a restaurant by comparing it to another similar restaurant.

                                              138                                      A-0963-12T1
See, e.g., RSB Lab. Servs., Inc. v. BSI, Corp., 368 N.J. Super.
540, 551-53 (App. Div. 2004).

      Elson identified those business lines most susceptible to

the information disseminated by defendants and then ascertained

a similar group of businesses – what he referred to as a cohort

group – that compete with C&F in those areas. He then drew

conclusions based on the performances of the cohort group in

those areas and through consideration of numerous other factors,

including     historical      performance,          the    ratings      provided       by

entities    whose     opinions      are   of    a   type    relied      upon    in    the

industry, as well as underwriting strategy, appetite for risk,

and   product    pricing.      In    calculating          the   results    of      these

comparisons,    Elson       determined      the     weighted    average     of     these

cohorts in the specific markets identified and compared that to

C&F's performance in those markets to calculate damages. We find

nothing disqualifying about Elson's approach.

      For the reasons we have outlined, we draw the following

conclusions. First, Elson's expert testimony is barred by the

application     of    New    York    law.       But,   second,     if     New    Jersey

substantive     law    governed      plaintiffs'          common   law    claims,        a

different conclusion may have been warranted49 because it has not

49As a matter of New Jersey law, a plaintiff's inability to fix
"with precision" its lost-profits damages may not always
                                                    (continued)

                                          139                                   A-0963-12T1
been shown that Elson lacked the necessary qualifications or

that he provided only net opinions.50

(continued)
preclude a recovery of damages, as we have held in different
settings. See V.A.L. Floors, Inc. v. Westminster Communities,
Inc., 355 N.J. Super. 416, 424 (App. Div. 2002) (quoting Inter
Med. Supplies v. EBI Med. Sys., 181 F.3d 446, 463 (3d Cir.
1999)). That is, our courts have held at times that "mere
uncertainty as to the amount [of damages] will not preclude the
right of recovery." Tessmar v. Grosner, 23 N.J. 193, 203 (1957);
see also Am. Sanitary Sales Co. v. State, Dep't of Treas., Div.
of Purchase & Prop., 178 N.J. Super. 429, 435 (App. Div.),
certif. denied, 87 N.J. 420 (1981). These authorities do not
expressly hold that this looser standard would apply to a
tortious interference with prospective economic advantage, and
we need not determine here whether it should.

50Although not necessary for our disposition of this aspect of
the appeal, we would further observe in the interest of
completeness that we see no error in the judge's refusal to
conduct a hearing regarding the admissibility of Elson's expert
testimony. We agree that ordinarily the best practice would be
for a trial judge to permit the examination of the scope of an
expert's opinion – when its admissibility is challenged – at a
pretrial N.J.R.E. 104(a) hearing. See Kemp ex rel. Wright v.
State, 174 N.J. 412, 432 (2002). We see no error in the failure
to conduct such a hearing here because Elson was examined at
great length at his deposition about his methodology and that
deposition testimony was available to and considered by the
trial judge at the time of his ruling. We have no reason to
believe – in light of the voluminous record on appeal – that a
N.J.R.E. 104(a) hearing would have better amplified the disputes
about his expert testimony; indeed, it seems to us that in this
particular instance the efficient administration of justice
would have been disserved if such a hearing were conducted.

                               140                      A-0963-12T1
                                        V

                         THE CROSS-APPEALS

      We turn to the cross-appeals filed by Morgan Keegan and the

Exis defendants. Morgan Keegan argues that the trial judge erred

in allowing plaintiffs to seek damages allegedly incurred by

non-party subsidiaries and that the trial judge erred in denying

Morgan Keegan's motion for summary judgment on First Amendment

grounds.51 We reject both these arguments.

                              A. Standing

      Morgan Keegan argues the trial judge erred in declining to

dismiss   plaintiffs'   claims     to       the   extent    plaintiffs      sought

damages incurred by nonparty subsidiaries. Morgan Keegan asserts

that three categories of damages were sustained not by Fairfax

and C&F – the only named plaintiffs – but instead represent

damages sustained by subsidiaries. Specifically, the argument

focuses on plaintiffs' claim to: (1) $545 million in alleged

lost profits related to insurance that would have been written

by   C&F's   subsidiaries;   (2)   $805       million      in   alleged    losses

relating to the sale of stock held in the ICICI Bank and sold by

51The Exis defendants also filed a cross-appeal and have argued
that the trial judge erred in denying their motion for summary
judgment on the disparagement claim based on standing and
statute of limitations grounds. The Exis defendants rely on the
arguments thoroughly posed by Morgan Keegan on these issues.

                                    141                                   A-0963-12T1
Fairfax's subsidiary Hamblin Watsa Investment Counsel, Ltd.; and

(3) $42 million in allegedly increased D&O liability insurance

costs paid by Fairfax but reimbursed by its subsidiaries.

       As we have already ruled, New York law applies and limits

the    damages     available      on   the     disparagement      and       tortious

interference       with   prospective      economic   advantage         claims     to

profits emanating from the alleged lost 180 customers. New York

law does not permit recovery for collateral damages, such as the

losses related to the sale of the ICICI stock or the increased

cost   of    D&O   insurance.     We   consider,   therefore,     the       argument

insofar as Morgan Keegan alleges the 180 customers were lost not

by C&F but by its subsidiaries.

       In   this      regard,   Morgan    Keegan    argues     that     a     parent

corporation lacks standing to bring the claims of a subsidiary –

regardless of whether New York or New Jersey law applies 52 – and

that the trial judge erred in holding                 that material factual

issues      existed     without    identifying     them,     as    Rule       4:46-3

requires. Morgan Keegan further argues that even if, as the

trial judge stated, plaintiffs might have been entitled to other

damages properly asserted, the trial court still should have

52There is no doubt, and no party has argued otherwise, that the
law of the forum governs this question of standing. See
Restatement (Second), supra, § 125.

                                         142                                A-0963-12T1
granted partial summary judgment as to any damages sought on

behalf of subsidiaries.

      Plaintiffs respond that courts broadly construe standing

and allow a plaintiff to assert a third party's rights if the

plaintiff states a "sufficient personal stake and adverseness

[to   the    defendant]."   Jersey     Shore   Med.   Ctr.-Fitkin    Hosp.   v.

Estate of Baum, 84 N.J. 137, 144 (1980); Assocs. Commercial

Corp. v. Langston, 236 N.J. Super. 236, 242 (App. Div.), certif.

denied, 118 N.J. 225 (1989). Parent corporations have been held

to meet that standard. Bondi, supra, 423 N.J. Super. at 436-37.

      The judge explained the motion was denied in this regard

because,     in   pertinent    part,     plaintiffs    argued    that    C&F's

subsidiaries' "losses are incorporated into C&F's consolidated

financial     statements,   and   moreover,     C&F   writes   its   insurance

policies through its subsidiaries[,] [which] are wholly-owned by

plaintiffs." The judge concluded:

             [E]ven   if   defendants'  allegations  are
             assumed to be accurate, there are still
             genuine issues of material fact with regard
             to whether plaintiffs have standing to
             pursue those actions on behalf of their
             subsidiaries . . . . Defendants' motion for
             summary judgment is not granted based on
             this rationale.

The denial of the summary judgment motion was warranted, based

on the trial judge's sound reasoning and reliance on                    Bondi,

which   we     discussed    earlier.     See   Section    IV(A)(3),     supra.

                                       143                            A-0963-12T1
Briefly, the plaintiff Bondi was an administrator appointed by

the Italian government to oversee the collapse of the Italian

company    Parmalat.        The    defendant      Citigroup    (Citi)     asserted       a

counterclaim as to which Bondi claimed it lacked standing to

pursue     because    the     claims    belonged        to   Citi's   subsidiaries.

Bondi, supra, 423 N.J. Super. at 436. We rejected that argument,

finding Citi "was the operating agent for the transactions," the

subsidiaries' business on the matter at issue "appeared on Citi

consolidated financial statements, and all profits and losses

flowed through Citi books. In short, any losses incurred by even

one subsidiary was considered a loss of Citi funds." Ibid. We

held "the evidence established that the funds loaned or extended

to Parmalat all originated from Citi." Id. at 438. Citi had

standing,     therefore,          because    in   New   Jersey,    "[a]    financial

interest in the outcome of litigation is ordinarily sufficient

to confer standing." Ibid. (quoting Assocs. Commercial Corp.,

supra, 236 N.J. Super. at 242).

      We   agree     this    reasoning      requires     a    rejection    of    Morgan

Keegan's argument. We conclude, as to the alleged lost insurance

profits suffered by C&F's insurance subsidiaries, there is merit

to the trial judge's view that the effect on C&F's consolidated

financial statements gave C&F a sufficient "financial interest

in   the   outcome     of     litigation"         to   preclude   a   dismissal        on

                                            144                                 A-0963-12T1
standing grounds. We find insufficient merit in Morgan Keegan's

arguments on standing to warrant further discussion in a written

opinion. R. 2:11-3(e)(1)(E).

                          B. First Amendment Grounds

                          1. The Parties' Arguments

       Morgan Keegan also argues that the trial judge erroneously

applied First Amendment principles because "no reasonable jury

could find by clear and convincing evidence that Morgan Keegan

published any false factual assertion with actual malice – that

is, with knowledge that it was false." Morgan Keegan argues that

the actual-malice standard applies because "large corporations

active in the public arena" like Fairfax and C&F are considered

public    figures,   and     the    law    affords    greater    protection    for

speech concerning public figures. It claims that despite more

than 150 depositions and the production of more than 15,000,000

pages of documents, plaintiffs were unable to identify a single

piece of evidence to support a contention that Morgan Keegan or

its analyst, Gwynn, did not believe the statements they made

were     true.   Morgan    Keegan     additionally      argues    that   whether

advance    tipping   was     provided       about    their   reporting   is    not

probative as to whether they believed the information in the

report was false. Morgan Keegan contends there was no evidence

of an incentive to report falsely, and asserts that the fact

                                          145                            A-0963-12T1
Gwynn's reporting contained an error in calculating Fairfax's

reserve deficiency, which was promptly corrected, does not raise

a fact issue as to the malice requirement.

       In   addition,       Morgan     Keegan      contends         the   First    Amendment

provides      absolute      protection       to    "opinions         that   do     not    imply

false facts" or that are "pure opinions" for which the factual

basis    is   disclosed.       It    argues        that    because        estimates       about

insurance company reserves are not verifiable, First Amendment

analysis mandates a presumption that statements about reserves

are    protected    because      they    are       mere    opinions.        Morgan       Keegan

contends further that the trial judge misconstrued the nature of

"context" in the First Amendment analysis; it claims that rather

than    referring      to     what     was   happening          at    the   time     of     the

statement,      context       refers    only       to     how   a    reader       would    have

interpreted the statement's content in view of the information

disclosed. Based on the disclaimers in Morgan Keegan analyst

reports, and with the underlying factual basis set forth, Morgan

Keegan contends the context reinforced its position that Gwynn's

statements      were    not    actionable          –    that    they      were    inherently

subjective, completely protected "pure" opinions.

       Plaintiffs respond that the trial judge's denial of the

motion was entirely correct because genuine issues of material

fact    precluded      summary       judgment.          Plaintiffs        point    out     that

                                             146                                     A-0963-12T1
Morgan Keegan's collaboration and coordination in furtherance of

the conspiracy went well beyond the statements in its reports,

so the possibility of First Amendment protection for a limited

number of statements provides no basis for dismissing Morgan

Keegan    as   a   defendant.    Plaintiffs       further    set    out    several

statements from the reports to support their contention that

Morgan Keegan either knew or recklessly disregarded the truth.

For example, plaintiffs contend Morgan Keegan admitted violating

its own policies, and those of the New York Stock Exchange,

because "it did not 'do a single thing' to determine whether its

claims were true and/or [sic] reasonable" and its supervisory

analyst provided no meaningful oversight. The First Amendment,

they   contend,    does   not   protect    such    knowingly       or   recklessly

false and misleading statements and, therefore, the trial judge

properly denied Morgan Keegan's motion.

                     2. The Trial Judge's Decision

       Relying on Romaine v. Kallinger, 109 N.J. 282 (1988), the

trial judge held that where a statement is capable of more than

one meaning, with only one being defamatory, "the question of

whether its content is defamatory is one that must be resolved

by the trier of fact." Although the judge acknowledged that the

dispute    presented      a   difficult    question     as     to       whether     a

statement's defamatory nature must be viewed solely within the

                                     147                                   A-0963-12T1
four corners of the report, or whether it could be considered

within the broader context of the alleged conspiracy, the judge

was    satisfied       that       there       were    material            issues    of    fact       that

required the motion's denial. For example, the judge determined

that a fact issue remained whether Morgan Keegan disclosed to

hedge fund investors the information contained in Gwynn's report

prior     to    its        actual       release;          in     that      case,    even       if      the

information          was    true,       the    release         "probably         [constituted]          an

illegal insider trading act," in which case, according to the

judge, "maybe that's not protected."

       The trial judge also relied on DeAngelis v. Hill, 180 N.J.
1   (2004),      and       Ward    v.    Zelikovsky,             136 N.J. 516    (1994),        as

support for the view that courts do consider context and "do not

automatically          decide       a     case       on        the    literal      meaning        of     a

challenged       statement."            Consequently,               the   judge    observed          that

"[c]ontext to me is also not just simply words on the paper but

when    it     was    said,       how    it    was     said,         to    whom    it    was    said."

Questions of fact, according to the trial judge, remained about

whether      Gwynn     or    Lawless          correctly         represented        certain          facts

about Fairfax's financial condition, and the verifiability of

those facts. The judge recognized that "[d]efendants want to

have    their        reports      characterized                as    pure    opinion,"         but      he

                                                 148                                           A-0963-12T1
determined that "even pure opinion requires me to analyze the

context of the matter and that's most troubling."

     Ultimately,     however,      the       judge      never     applied      these

principles   to    the      parties'    assertions.       He     recognized       the

questions posed were fact-sensitive but believed the process of

determining whether the First Amendment afforded protection to

Morgan Keegan was so "daunting" as to preclude the painstaking,

statement-by-statement analysis, which the law requires, through

what the judge referred to as "38 boxes" of materials.53

                               3. Our Holding

     To be sure, our courts have held that the "summary judgment

practice is particularly well-suited for the determination of

libel [and defamation] actions" because those actions "tend to

'inhibit   comment   on     matters    of    public     concern.'"    DeAngelis,

supra, 180 N.J. at 12 (quoting Dairy Stores, supra, 104 N.J. at

157). This lion of a case, however, mocks those beliefs. Indeed,

although   the    summary    judgment       procedure    is     favored   in    such

53In his March 16, 2012 oral decision, the trial judge observed
that "everybody agrees that the statement-by-statement analysis
the [c]ourt must go through is an extremely-daunting task and I
think it's an unreasonable – let me not say that, I think it's
the kind of task – I don't want to put it that way either. I did
go through the statements, I did – I did go through the reports,
but for me to conclude that there's no[t] one element of lack of
truth in those – in that record is, I don't think that's
inappropriate – well, it's not that it's inappropriate, I can't
do that, I can't make that finding."

                                       149                                  A-0963-12T1
instances,     that     is     chiefly   so   because    putting    a     speaker   or

publisher through the discovery process could have a chilling

effect on free speech. See Armstrong v. Simon & Schuster, Inc.,

649 N.E.2d 825,    828    (N.Y.    1995).    Considering      the    amount   of

discovery already taken here, it seems a little late in the day

– maybe ten years late – to express concern for the chilling

effect of litigation and discovery.

       Moreover, the question is particularly elusive on appeal

because the judge failed to engage in the process required by

law. The statement-by-statement analysis that is required should

not occur for the first time on appeal, and we decline to make

an exception here.

       We remand on this point for the trial judge to consider

further the application of First Amendment principles to the

disparagement claims asserted against Morgan Keegan and the Exis

defendants.54 Applied to a claim of disparagement, New York law

would require a determination of whether any of the statements

in    question    were    "susceptible        of   a   defamatory    connotation,"

54These same First Amendment principles apply even if the claim
does not sound in defamation but in some other theory of
recovery. See, e.g., Hustler Magazine v. Falwell, 485 U.S. 46,
56, 108 S. Ct. 876, 882, 99 L. Ed. 2d 41, 52 (1988); Food Lion,
Inc. v. Capital Cities/ABC, Inc., 194 F.3d 505, 522 (4th Cir.
1999); Hornberger v. Am. Broad. Cos., Inc., 351 N.J. Super. 577,
628-30 (App. Div. 2002); LoBiondo v. Schwartz, 323 N.J. Super.
391, 415-17 (App. Div.), certif. denied, 162 N.J. 488 (1999).

                                          150                                A-0963-12T1
Davis    v.   Boeheim,   22 N.E.3d 999,   1003-04        (N.Y.    2014),       as

outlined in cases such as Thomas H. v. Paul B., 965 N.E.2d 939,

942 (N.Y. 2012) (for example, false statements "that tend[] to

expose a person to public contempt, hatred, ridicule, aversion

or disgrace"), and that the statements do not constitute "pure

opinion," which would not be actionable because "[e]xpressions

of   opinion,   as   opposed    to    assertions     of    fact,       are    deemed

privileged . . . no matter how offensive," Mann v. Abel, 885
N.E.2d 884, 885-86 (N.Y. 2008). Stated another way, no matter

"how[]   pernicious      an   opinion    may    seem,     we   depend        for   its

correction not on the conscience of judges and juries but on the

competition of other ideas." Steinhilber v. Alphonse, 501 N.E.2d
550, 552 (N.Y. 1986) (quoting Gertz v. Robert Welch, Inc., 418
U.S. 323, 339-40, 94 S. Ct. 2997, 3007, 41 L. Ed. 2d 789, 805

(1974)). And, "[w]hile a pure opinion cannot be the subject" of

an actionable claim, Davis, supra, 22 N.E.3d at 1004, an opinion

that "implies that it is based upon facts which justify the

opinion but are unknown to those reading or hearing it, . . . is

a 'mixed opinion' and is actionable." Steinhilber, supra, 501

N.E.2d at 552-53.

      "What   differentiates     an     actionable   mixed      opinion       from    a

privileged, pure opinion is 'the implication that the speaker

knows certain facts, unknown to [the] audience, which support

                                      151                                    A-0963-12T1
[the speaker's] opinion and are detrimental to the person' being

discussed."      Davis,      supra,       22     N.E.3d         at     1004       (quoting

Steinhilber,     supra,      501    N.E.2d       at     553).        For    guidance       in

determining      whether     a     reasonable         reader      would     consider        a

statement as connoting facts or nonactionable opinions, New York

law provides three factors: "(1) whether the specific language

in issue has a precise meaning which is readily understood; (2)

whether    the   statements      are    capable       of   being      proven      true    or

false;    and    (3)     whether       either    the       full      context       of     the

communication       in   which   the    statement       appears       or    the    broader

social    context    and   surrounding         circumstances          are   such     as   to

signal . . . readers or listeners that what is being read or

heard is likely to be opinion, not fact." Brian v. Richardson,

660 N.E.2d 1126, 1129 (N.Y. 1995). The third factor "lends both

depth and difficulty to the analysis," ibid., and requires a

consideration of "the content of the communication as a whole,

its tone and apparent purpose." Davis, supra, 22 N.E.3d at 1005.

    We would also add that Morgan Keegan's claim to summary

judgment is impacted by whether plaintiffs can show that any

false statements of fact were made with "malice," which would

require evidence of actual knowledge or reckless disregard of a

statement's falsity. Gertz, supra, 418 U.S. at 334, 94 S. Ct. at

2997, 41 L. Ed. 2d at 802. Whether a finding of actual malice

                                         152                                       A-0963-12T1
requires clear and convincing evidence or only a preponderance

of    the   evidence    depends     upon     whether   plaintiffs       are    public

figures, see Weldy v. Piedmont Airlines, 985 F.2d 57, 63-65 (2d

Cir.   1993)   (applying      New   York     law);   see   also    Masson     v.    New

Yorker Magazine, 501 U.S. 496, 610, 111 S. Ct. 2419, 2429, 115
L. Ed. 2d 447, 468 (1991) (observing that "[w]hen . . . the

plaintiff is a public figure, he cannot recover unless he proves

by clear and convincing evidence that the defendant published

the defamatory statement with actual malice"). Plaintiffs have

not been clear about their position on this point; Morgan Keegan

asserts that plaintiffs did not contest in the trial court that

they are public figures.

       The particular question of whether a business entity may be

characterized as a public figure has proved vexing. See Dairy

Stores,     supra,     104   N.J.   at     139.   Courts    have    held      that     a

corporation becomes a public figure when inviting reviews and by

advertising extensively, Bose Corp. v. Consumers Union of U.S.,

Inc., 508 F. Supp. 1249, 1273 (D. Mass. 1981), rev’d on other

grounds, 692 F.2d 189 (1st Cir. 1982), aff’d on other grounds,

466 U.S. 485, 104 S. Ct. 1949, 80 L. Ed. 2d 502 (1984), or when

the    corporation     has   "considerable        access    to    the   media"       or

"voluntar[il]y       ent[ers]     into   a     [public]    controversy,"       United

States Healthcare, Inc. v. Blue Cross of Greater Phila., 898

                                         153                                  A-0963-12T1
F.2d 914, 938 & n.29 (3d Cir. 1990). By way of example, in

Reliance Ins. Co. v. Barron's, 442 F. Supp. 1341, 1348 (S.D.N.Y.

1977), the court held that an insurance company – regulated by

state insurance law and required to file reports with the SEC –

whose "shares [we]re traded on the New York Stock Exchange,"

possessed "more than a billion dollars in assets," and "offered

to sell its stock to the public," had "voluntarily thrust[ed]

itself   into     the   public   arena,      at    least   as    to   all    issues

affecting that proposed stock sale," and was, therefore, to be

treated as a public figure "with respect to issues involving its

offering of securities to the public."55

     There remains a lack of clarity since our Supreme Court

expressed uncertainty about this thirty years ago. Dairy Stores,

supra, 104 N.J. at 139 (recognizing "that the constitutional

concepts do not comfortably fit the activities or products of a

corporation"). But we need not delve further into this area. As

noted    above,    plaintiffs    may    not       have   disputed     the    point.

Moreover, the questions whether plaintiffs are public figures

are not presently reviewable. Although we apply the same summary

judgment   standards     that    governed     the    trial      judge,   Townsend,

55 Whether a corporation possesses fame and notoriety or seeks
out attention raises questions as to whether it should be viewed
as a general-purpose public figure or a limited-purpose public
figure. See Steaks Unlimited v. Deaner, 623 F.2d 264, 273 (3d
Cir. 1980).

                                       154                                  A-0963-12T1
supra, 221 N.J. at 59, and are required to examine the same

materials that were presented to the trial judge, Lombardi v.

Masso, 207 N.J. 517, 542 (2011); Noren v. Heartland Payment

Sys., __ N.J. Super. __, __ (App. Div. 2017) (slip op. at 3), we

are not expected, in applying those principles, to canvass the

record to determine whether plaintiffs' claims may be maintained

against Morgan Keegan and the Exis defendants when the trial

judge     has   not   first    undertaken      this   task.       We    certainly

appreciate the size of the record and the burdensome nature of

the task, but our procedures require that the effort first be

exerted in the trial court.

                                      VI

                                  CONCLUSION

     For these reasons, we affirm: the May 11, 2012 order which

dismissed the RICO claims (counts one and two56); the December

23, 2011 order which dismissed in all respects as to defendants

Kynikos,    Third     Point,   Chanos,     Perry   and     Loeb    on    personal

jurisdiction grounds; the September 25, 2008 order which granted

summary    judgment    in   all   respects   in    favor    of    Copper    River

Partners, David Rocker, and Rocker Partners, L.P.; that part of

56We refer in this paragraph to the counts as they appear in the
third amended complaint.

                                     155                                 A-0963-12T1
the    September      12,    2012     order    that      precluded       Elson's      expert

testimony; and the August 14, 2012 order57 that denied Morgan

Keegan's motion for summary judgment. We reverse: the August 21,

2012 order, which determined that the disparagement claim (count

three)    and   the     tortious       inference         with    prospective      economic

advantage claim (count five) were governed by New York's three-

year    statute    of       limitations;       the    September         12,    2011     order

granting summary judgment in the SAC defendants' favor; and that

part of the September 12, 2012 order that found the allegations

concerning 180 lost customers to be inadequate.

       Affirmed    in       part,     reversed      in    part,    and    remanded       for

further proceedings, in conformity with this opinion, on the

claims    set   forth       in    counts    three,       five,    and    six,58    as    they

pertain    to   Morgan       Keegan,       S.A.C.    Capital       Management,        S.A.C.

Capital     Advisors,        S.A.C.     Capital       Associates,        Sigma     Capital

Management,       Steven         A.   Cohen,      Exis     Capital,       Exis     Capital

Management,     Exis        Differential       Partners,         and    Exis   Integrated

Partners.

       We do not retain jurisdiction.

57   This order was mistakenly dated October 12, 2012.

58 Count six alleges a civil conspiracy by all defendants.
Because there are other maintainable tort causes of action, this
civil conspiracy claim may also be maintained.

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