Anwar et al v. Fairfield Greenwich Limited et al
Filing
769
ANSWER to Complaint. Document filed by Standard Chartered Bank International (Americas) Limited.(Nelles, Sharon)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
PASHA ANWAR, et al.,
Plaintiffs,
Master File No. 09-CV-118 (VM)
v.
FAIRFIELD GREENWICH LIMITED, et al.,
Defendants.
This Document Relates To: Carlos Carrillo v. Standard
Chartered Bank International (Americas) Ltd., et al.,
No. 10-CV-6187.
Standard Chartered Bank International (Americas) Limited’s
Answer and Defenses to the Complaint
Defendant Standard Chartered Bank International (Americas) Limited (“SCBI”) (referred
to herein as “Defendant”), through its undersigned counsel, hereby responds as follows to the
complaint (the “Complaint”), based on present knowledge. Defendant reserves the right to
supplement and amend this Answer and to add additional defenses of which it becomes aware
through discovery or other investigation.
I.
ANSWER
Nature of Proceeding
1.
Defendant denies the allegations of paragraph 1, except admits to the public knowledge
that Bernard Madoff perpetrated a massive Ponzi scheme. Defendant respectfully refers the
Court to Madoff’s plea allocution in the case captioned United States v. Madoff, No. 09-CR-
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00213 (S.D.N.Y. March 12, 2009) for a complete and accurate description of Bernard Madoff’s
role in the Ponzi scheme.
2.
Defendant denies the allegations of paragraph 2, except admits that: (i) plaintiff invested
$350,000 in Fairfield Sentry Ltd. (“Sentry”) through his account with Defendant, which was
formerly named American Express Bank International (Americas) Ltd. (“AEBI”); and
(ii) substantially all of the assets of Sentry were invested with Bernard L. Madoff Investment
Securities (“BLMIS”).
3.
Defendant denies the allegations of paragraph 3, except admits that Sentry had a history
of stable and steady returns.
4.
Defendant denies the allegations of paragraph 4.
5.
Defendant denies the allegations of paragraph 5.
6.
Defendant denies the allegations of paragraph 6.
7.
Defendant denies the allegations of paragraph 7.
8.
Defendant denies the allegations of paragraph 8.
9.
Defendant denies the allegations of paragraph 9.
10.
Defendant denies the allegations of paragraph 10.
11.
Defendant admits that plaintiff purports to characterize the allegations in Picard v.
Fairfield Sentry Limited, et al., No. 09-1239 (Bankr. S.D.N.Y.), an action brought by the trustee
of BLMIS and lacks knowledge or information sufficient to form a belief as to the truth of the
remaining allegations of paragraph 11 and therefore denies them.
Jurisdiction, Venue and Parties
12.
Defendant admits that plaintiff purports to seek damages but denies that plaintiff suffered
damages as a result of any conduct by Defendant.
13.
Defendant denies the allegations of paragraph 13.
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14.
Defendant admits the allegations of paragraph 14.
15.
Defendant admits the allegations of paragraph 15.
16.
Defendant admits that: (i) on or about February 2008, AEBI was acquired by Standard
Chartered PLC; and (ii) AEBI was renamed SCBI.
17.
Defendant denies the allegations of paragraph 17, except admits that: (i) Antonio Garcia-
Adanez was a relationship manager employed by Defendant; (ii) Garcia-Adanez serviced
plaintiff’s account with Defendant.
18.
Defendant admits that plaintiff purports to characterize the contents of the General Pledge
Agreement and respectfully refers the Court to that agreement for a complete and accurate
description of its contents. Paragraph 18 of the complaint does not identify any of the other
“various agreements” plaintiff refers to and Defendant therefore lacks knowledge or information
sufficient to form a belief as to the truth of the remaining allegations of paragraph 18 and
therefore denies them.
19.
Defendant admits that plaintiff purports to characterize the contents of the Master
Demand Note and respectfully refers the Court to that note for a complete and accurate
description of its contents.
20.
Defendant denies the allegations of paragraph 20, except admits that: (i) plaintiff’s
account was opened at the Miami office of Defendant; (ii) the Miami office of Defendant is
located at 1111 Brickell Avenue, Miami, Florida 33131; (iii) plaintiff invested in Sentry through
Defendant’s Miami office; and (iv) plaintiff’s account was serviced through the Miami office of
Defendant.
21.
Defendant denies the allegations of paragraph 21, except admits that: (i) plaintiff
purports to base jurisdiction in this action on Fla. Stat. § 48.193; and (ii) Defendant conducts
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business through an office in Miami, Florida. Defendant also admits that plaintiff purports to
characterize the contents of the General Pledge Agreement and the Master Note and respectfully
refers the Court to those documents for a complete and accurate description of their contents.
22.
Defendant denies the allegations of paragraph 22, except admits that: (i) plaintiff
purports to base venue in this action on Fla. Stat. §§ 47.011 and 47.051; and (ii) Defendant has
an office in Miami, Florida. Defendant also admits that plaintiff purports to characterize the
contents of the General Pledge Agreement and the Master Demand Note and respectfully refers
the Court to those documents for a complete and accurate description of their contents.
Factual Allegations
23.
Defendant admits the allegations of paragraph 23.
24.
Defendant denies the allegations of paragraph 24 and avers that plaintiff’s accounts at
AEBI were assigned Account Numbers ****3810 and ****6475.
25.
Defendant denies the allegations of paragraph 25.
26.
Defendant denies that plaintiff’s securities investment accounts were transferred to
StanChart Securities International, Inc. in November 2008 and lacks knowledge or information
sufficient to form a belief as to the truth of the remaining allegations of paragraph 26 and
therefore denies them.
27.
Defendant denies the allegations of paragraph 27, except admits that: (i) Antonio Garcia-
Adanez was a relationship manager employed by Defendant; (ii) Garcia-Adanez serviced
plaintiff’s account with Defendant; and (iii) plaintiff’s account was serviced through Defendant’s
Miami office.
28.
Defendant denies the allegations of paragraph 28.
29.
Defendant denies the allegations of paragraph 29.
30.
Defendant denies the allegations of paragraph 30.
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31.
Defendant denies the allegations of paragraph 31, except admits that Sentry had a history
of stable and steady returns.
32.
Defendant denies the allegations of paragraph 32, except admits that plaintiff authorized
and approved the purchase of shares in Sentry.
33.
Defendant admits that plaintiff invested $350,000 in Sentry on or about September 26,
2008, and respectfully refers the Court to plaintiff’s account statements and purchase
confirmation for a complete and accurate description of their contents.
34.
Defendant denies the allegations of paragraph 34.
35.
Defendant denies the allegations of paragraph 35.
36.
Defendant denies the allegations of paragraph 36, except admits that SCBI charged
certain account fees associated with investments in Sentry.
37.
Defendant denies the allegations of paragraph 37.
38.
Defendant denies the allegations of paragraph 38.
39.
Defendant denies the allegations of paragraph 39.
40.
Defendant lacks knowledge or information sufficient to form a belief as to the truth of the
allegations of paragraph 40 and therefore denies them.
41.
Defendant denies the allegations of paragraph 41.
42.
Defendant denies the allegations of paragraph 42.
43.
Defendant denies the allegations of paragraph 43, except admits that plaintiff invested
$350,000 in Sentry through his account at SCBI.
44.
Defendant denies the allegations of paragraph 44.
45.
Defendant denies the allegations of paragraph 45, except admits that Sentry invested
substantially all of its assets in BLMIS.
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46.
Defendant denies the allegations of paragraph 46, except admits that Fairfield provided
copies of its Private Placement Memoranda (“PPMs”) to Defendant and that Sentry’s investment
strategies were disclosed in its PPMs.
47.
Defendant admits that plaintiff purports to characterize the contents of a PPM and
respectfully refers the Court to that PPM for a complete and accurate description of its contents.
48.
Defendant denies the allegations of paragraph 48, except admits that Sentry invested
substantially all of its assets in BLMIS.
49.
Defendant admits the allegations of paragraph 49.
50.
Defendant denies the allegations of paragraph 50.
51.
Defendant denies the allegations of paragraph 51.
52.
Defendant admits the allegations of paragraph 52.
53.
Defendant admits that plaintiff purports to characterize the contents of a criminal
complaint filed by the U.S. Attorney’s Office for the Southern District of New York and the
complaint filed by the SEC in SEC v. Bernard L. Madoff, No. 08-CV-10791 (S.D.N.Y. Dec. 11,
2008), and Defendant respectfully refers the Court to those complaints for a complete and
accurate description of their contents.
54.
Defendant admits that Madoff pleaded guilty to securities and wire fraud on March 12,
2009, and that plaintiff purports to characterize the contents of a plea allocution by Bernard L.
Madoff. Defendant respectfully refers the Court to that plea allocution for a complete and
accurate description of its contents.
55.
Defendant denies the allegations of paragraph 55, except admits that Bernard L. Madoff
and BLMIS perpetrated a fraud and concealed it from Defendant and lacks knowledge or
information sufficient to form a belief as to the truth of the remaining allegations of paragraph 55
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and therefore denies them. Defendant respectfully refers the Court to Madoff’s Plea Allocution
in the case captioned United States v. Madoff, No. 09-CR-00213 (S.D.N.Y. Mar. 12, 2009) for a
description of Madoff’s role in the Ponzi scheme and his admissions regarding the role.
56.
Defendant denies the allegations of paragraph 56.
57.
Defendant denies the allegations of paragraph 57, except admits that BLMIS functioned
as an investment manager and custodian of securities.
58.
Defendant denies the allegations of paragraph 58.
59.
Defendant denies the allegations of paragraph 59.
60.
Defendant denies the allegations of paragraph 60, except admits that plaintiff purports to
characterize the contents of complaints in civil actions, including Anwar v. Fairfield Greenwich
Limited, No. 09-CV-118 (S.D.N.Y.), and Tradewaves Ltd., et al. v. Standard Chartered
International (USA) Ltd., et al., No. 09-CV-9423 (S.D.N.Y.). Defendant respectfully refers the
Court to the complaints in those actions for a complete and accurate description of their contents.
61.
Defendant denies the allegations of paragraph 61.
62.
Defendant denies the allegations of paragraph 62.
Count One
Violations of Section 517.301, et seq., of the Florida Statutes
(As Against All Defendants)
63.
Defendant incorporates its responses to paragraphs 1 through 62 as if fully set forth
herein.
64.
The allegations of paragraph 64 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
65.
The allegations of paragraph 65 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
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66.
The allegations of paragraph 66 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
67.
The allegations of paragraph 67 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
68.
The allegations of paragraph 68 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
69.
The allegations of paragraph 69 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
70.
The allegations of paragraph 70 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
71.
The allegations of paragraph 71 relate to plaintiff’s claim for a violation of Fla. Stat.
§ 517.301, which was dismissed by the Court; therefore, no response is required.
Count Two
Breach of Fiduciary Duty
(As Against All Defendants)
72.
Defendant incorporates its responses to paragraphs 1 through 71 as if fully set forth
herein.
73.
To the extent that the allegations of paragraph 73 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 73.
74.
To the extent that the allegations of paragraph 74 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 74.
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75.
To the extent that the allegations of paragraph 75 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 75.
76.
To the extent that the allegations of paragraph 76 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 76.
77.
To the extent that the allegations of paragraph 77 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 77.
78.
To the extent that the allegations of paragraph 78 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 78.
79.
To the extent that the allegations of paragraph 79 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 79.
80.
To the extent that the allegations of paragraph 80 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required; the allegations of paragraph 80 also contain a legal conclusion to which no response is
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required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 80.
81.
To the extent that the allegations of paragraph 81 relate to plaintiff’s claim for breach of
fiduciary duty based on a failure to monitor, which was dismissed by the Court, no response is
required. To the extent that a response is deemed required, Defendant denies the allegations of
paragraph 81.
Count Three
Negligence
(As Against All Defendants)
82.
Defendant incorporates its responses to paragraphs 1 through 81 as if fully set forth
herein.
83.
The allegations of paragraph 83 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
84.
The allegations of paragraph 84 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
85.
The allegations of paragraph 85 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
86.
The allegations of paragraph 86 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
87.
The allegations of paragraph 87 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
88.
The allegations of paragraph 88 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
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89.
The allegations of paragraph 89 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
90.
The allegations of paragraph 90 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
91.
The allegations of paragraph 91 relate to plaintiff’s claim for negligence, which was
dismissed by the Court; therefore, no response is required.
Count Four
Negligent Misrepresentation
(As Against All Defendants)
92.
Defendant incorporates its responses to paragraphs 1 through 91 as if fully set forth
herein.
93.
The allegations of paragraph 93 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
94.
The allegations of paragraph 94 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
95.
The allegations of paragraph 95 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
96.
The allegations of paragraph 96 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
97.
The allegations of paragraph 97 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
98.
The allegations of paragraph 98 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
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99.
The allegations of paragraph 99 relate to plaintiff’s claim for negligent misrepresentation,
which was dismissed by the Court; therefore, no response is required.
Count Five
Unjust Enrichment and Constructive Trust
(As Against All Defendants)
100.
Defendant incorporates its responses to paragraphs 1 through 99 as if fully set forth
herein.
101.
The allegations of paragraph 101 relate to plaintiff’s claim for unjust enrichment and
constructive trust, which was dismissed by the Court; therefore, no response is required.
102.
The allegations of paragraph 102 relate to plaintiff’s claim for unjust enrichment and
constructive trust, which was dismissed by the Court; therefore, no response is required.
103.
The allegations of paragraph 103 relate to plaintiff’s claim for unjust enrichment and
constructive trust, which was dismissed by the Court; therefore, no response is required.
104.
The allegations of paragraph 104 relate to plaintiff’s claim for unjust enrichment and
constructive trust, which was dismissed by the Court; therefore, no response is required.
105.
The allegations of paragraph 105 relate to plaintiff’s claim for unjust enrichment and
constructive trust, which was dismissed by the Court; therefore, no response is required.
Denial of Prayer for Relief
Defendant denies that plaintiff is entitled to any of the relief prayed for on page 26 of the
Complaint.
Jury Trial Demand
Plaintiff’s demand for a trial by jury is subject to his account agreements with Defendant.
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II.
DEFENSES
First Defense
Plaintiff fails to state a claim upon which relief can be granted.
Second Defense
Any damages allegedly suffered by plaintiff were caused by the intervening act(s) or
omission(s) of persons or entities other than Defendant, and said act(s) or omission(s) superseded
any act or omission by Defendant for which it might be considered liable.
Third Defense
Plaintiff’s claims are barred, in whole or in part, because Defendant’s alleged conduct
was not the cause of plaintiff’s injuries.
Fourth Defense
The claims asserted in the Complaint are barred by the equitable doctrines of laches,
waiver, estoppel, unclean hands, and other equitable defenses that may appear upon further
discovery and investigation.
Fifth Defense
Plaintiff’s claims are barred, in whole or in part, because plaintiff knowingly and
voluntarily assumed the risks inherent in the investments at issue.
Sixth Defense
Plaintiff’s claims are barred, in whole or in part, by the economic loss doctrine.
Seventh Defense
Plaintiff’s claims are barred, in whole or in part, because they are preempted by the
Securities Litigation Uniform Standards Act, 15 U.S.C. § 78bb(f)(1).
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Eighth Defense
Plaintiff did not justifiably or reasonably rely on any alleged representations, acts or
omissions by Defendant.
Ninth Defense
Plaintiff’s claims are barred, in whole or in part, because Defendant, or any person or
entity acting or purporting to act on its behalf, acted in good faith and with due care and
diligence.
Tenth Defense
Plaintiff’s claims are barred, in whole or in part, by virtue of his account agreements with
Defendant.
Eleventh Defense
Plaintiff’s claims are barred, in whole or in part, by virtue of disclosures in the applicable
Subscription Agreements and the PPM.
Twelfth Defense
Defendant was entitled to and did, reasonably and in good faith, rely on the acts and
representations of other third parties with respect to the transactions and events that are the
subject of plaintiff’s claims.
Thirteenth Defense
Any damages recoverable by plaintiff from Defendant are limited to the percentage of
fault attributable to Defendant, and thus would not include the percentage of fault attributable to
plaintiff or third parties, including but not limited to the defendants named in the Second
Consolidated Amended Complaint in Anwar v. Fairfield Greenwich Limited, No. 09-CV-0118.
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Fourteenth Defense
Any recovery by plaintiff against Defendant is to be offset, in whole or in part, by any
and all other recoveries by plaintiff with respect to his investments in Sentry.
Fifteenth Defense
Defendant is entitled to recover contribution from others for any liability it incurs to
plaintiff.
Sixteenth Defense
Any recovery by plaintiff against Defendant is to be offset by any and all debts, liabilities
or obligations owed by plaintiff to Defendant.
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WHEREFORE, Defendant respectfully demands judgment dismissing this action with
prejudice together with its costs and disbursements.
Respectfully submitted,
By: /s/ Diane L. McGimsey
Sharon L. Nelles
Bradley P. Smith
Patrick B. Berarducci
SULLIVAN & CROMWELL LLP
125 Broad Street
New York, New York 10004
Telephone: (212) 558-4000
Facsimile: (212) 558-3588
Diane L. McGimsey
SULLIVAN & CROMWELL LLP
1888 Century Park East
Los Angeles, California 90067
Telephone: (310) 712-6600
Facsimile: (310) 712-8800
Attorneys for Defendant
Standard Chartered Bank
International (Americas) Ltd.
December 27, 2011
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