Anwar et al v. Fairfield Greenwich Limited et al

Filing 1308

ENDORSED LETTER addressed to Judge Victor Marrero from Sharon L. Nelles dated 8/21/2014 re: For the foregoing reasons, Barbachano's request to amend her complaint separate and apart from repleading a uniform negligence count in coordination with all other plaintiffs should be denied. ENDORSEMENT: The Clerk of Court is directed to enter into the public record of this action the letter above submitted to the Court by Standard Chartered Bank defendants. (Signed by Judge Victor Marrero on 8/22/2014) (tn)

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By Facsimile
Honorable Victor Marrero.
United States District Judge,
Daniel Patrick Moynihan United States Courthouse,
500 Pearl Street,
New York. New York 10007.
Re:

Anwar, et al. v. Fairfield Greenwich Lrd.. er al., No. 09-CV-118
(S.D.N.Y.)- Standard Chartered Cases

Dear Judge Marrero:
We write on behalf of the Standard Chartered Defendants ("SCB"). On August
13, at the conclusion of the teleconference regarding Teresa Barbachano's request for leave to
file a Second Amended Complaint. the Court directed the parties to submit letters regarding
Barbachano's contencion that she has made "suitability'' allegations that render her complaint
"unique" among the Standard Chartered Cases. The Court long ago rejected this contention. and
it in any evem provides no basis for Barbachano to amend her complaint. The Court should thus
deny Barbachano's request on the following grounds: (i) the proposed negligence claim is
improper because Barbachano did not comply with the Court's prior instruction to coordinate
with the Standard Chartered Plaintiffs' Steering Committee regarding the filing of a uniform
negligence claim; and (ii) Barbachano's other proposed amendments are beyond the scope of
that permitted by the Court's prior Orders.
As Barbachano concedes in her August 18 letter (Dkt. No. 1307), this Court held
nearly two years ago that "an inspection of the Barbachano complaint shows that what the
plaintiff stylizes as an allegation of 'failure to render suitable investment advice' is actually
indistinguishable from an allegation of negligent failure to conduct due diligence." Anwar v.
Fairfield Greenwich Ltd., 891 F. Supp. 2d 548. 552 (S.D.N.Y. 2012). In other words.
Barbachano is not unique.
Barbachano nonetheless asserts chac the Court could not possibly have meant what
it said because (i) the above language appears in the portion of the opinion discussing Florida' .s
"economic loss rule"; (ii) the Coun's prior published opinion in the Standard Chartered Cases
had not addressed "portfolio suitability claims"; (iii) the Court's October 24, 2012 opinion which reaffirmed the dismissal of three of Barbachano'.s claims - did not discuss suitability;
(iv) suitability supposedly is not a "generic" concept; and (v) Barbachano "alleges a fiduciary
relation.ship" with SCB. These arguments fail for three reasons:

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S&C LLP 125 27FL

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Honorable Y ictor Marrero

Fir.'it, none of these arguments alters the fact that this Court "inspect[ edl"
Barbachano's allegations and in September 2012 found them to be .. indistinguishable" from the
allegations made by plaintiff$ in the other Standard Chartered Cases. 891 F. Supp. 2d at 552. It
is not relevant to any analysis that the economic loss rule has. been altered or that Barbachano's
1
fiduciary duty claim remain11 alive.
Second, if Barbachano believed that the Court erred in holding that her allegations
are indistinguishable from those of other plaintiffs, she should have moved for reconsideration
within fourteen days of the Court's decision, as required by Local Civil Rule 6.3. She did not.
A"> such, the Court's determination that Barbachano' s allegations are not unique "now stands a.-:;
the law of the case" and there is not "any recognized procedural means by which to rescind it or
take it back." Anwarv. Fairfield Greenwich Ltd., No. 09-CV-118. 2013 WI.. 2247271, at *2
(S.D.N.Y. May 10, 2013). The limited ha.4'is upon which Barbachano and other plaintiffs
obtained leave to replead a negligence claim was the Florida Supreme Court's decision in Tiara
Condominium Ass 'n, Inc. v. Marsh & McLennan Cos., Inc., 110 So. 3d 399 (Fla. 2013). which
altered application of the economic loss rule under Florida law. Tiara Condo did not abrogate or
alter the Court's prior construction of Barbachano's allegations.

Third, Barbachano'!) "generic" assertion that SCB failed Lo properly diversify her
portfolio cannot survive the Court's prior holding that SCB owed plaintiffs no duty to diversify
their portfolios. Anwar. 891 F. Supp. 2d at 557. Barbachano's allegat1ons concerning a
"fiduciary relationship" are beside the point and, in any event. indistinguishable from the
allegations advanced by other plaintiffs whose duty-to-diversify claims were rejected by this
Court. Compare Barbachano Am. Compl. 9fil 13-14 with, e.g., No. 11 Civ. 7650, Comp!. <ffil 22,
35-36, 44.
For the foregoing reasons. Barbachano's request to amend her complaint separate
and apart from repleading a uniform negligence count in coordination with all other plaintiffs
should be denied.
Respectfully submitted,

~t.
Sharon L. Nelles
cc:

H. Eugene Lindsey, Counsel for Plaintiff Teresa Barbachano (by e-mail)
Standard Chartered Plaintiffs' Steering Committee (by e-mail)

I

In her Augu~t 18 letter, Barbachano argues that Rule 9(b) does not apply m her gm~.~ negligence or
fiduciary duty claims and also a.~ks the Court to remand her case to the Southern District nf F1orida.. These two
point~ are beyond the scope of the submissions that the Court requested. Tn .~hnrt, this Court has already applied
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Rule 9(b) to all ofBarbachano'~ claims that are based on alleged negligent misrepresentation$. Anwar. 891 F. Supp.
2d at 552. There also is no basis for rbe Court to remand rhe Barbachano case at rhis time. (See Secnnd Amended
Scheduling Order Regarding Standard Chartered Cases. ~~&r.-~~---~-------------------;..

SO ORDERED•

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