Bank Leumi – Dismissal of Complaint
Representation of Bank Leumi USA in lawsuit by a trustee for bankrupt jeweler M. Fabrikant & Sons, Inc., who sought to recover approximately $12 million in payments Fabrikant had made to Bank Leumi on account of loans made to Fabrikant prior to the bankruptcy filing. Herrick, together with counsel to several co-defendant financial institutions, successfully argued that the Complaint failed to plead a plausible cause of action for fraudulent transfer or preference recovery. The Bankruptcy Court agreed and ordered the dismissal of the Third Amended Complaint; that order was appealed to the United States District Court (S.D.N.Y.), where Judge Sullivan agreed with the Bankruptcy Court. The plaintiff then sought review by the Second Circuit Court of Appeals. On October 2, 2013, the Second Circuit issued an opinion affirming the dismissal.