Phoenix Light SF Limited et al v. U.S. Bank National Association et al

Filing 436

OPINION & ORDER re: 423 MOTION to Alter Judgment re: 422 Clerk's Judgment . filed by Silver Elms CDO plc, Phoenix Light SF DAC, Kleros Preferred Funding V Plc, Silver Elms CDO II Limited, Blue Heron Funding VI Ltd ., C-Bass CBO XVII Ltd., C-Bass CBO XIV Ltd., Blue Heron Funding VII Ltd. For the foregoing reasons, Plaintiffs' motion for reconsideration and to amend the judgment is DENIED. The Clerk of Court is respectfully directed to terminate the open motion at Document 423. (As further set forth in this Order.) (Signed by Judge Vernon S. Broderick on 8/12/2020) (cf)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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:
PHOENIX LIGHT SF LIMITED, et al.,
:
:
Plaintiffs,
:
:
-v:
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U.S. BANK NATIONAL ASSOCIATION,
:
:
Defendant. :
:
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Appearances:
David H. Wollmuth
Lyndon M. Tretter
Steven S. Fitzgerald
Roselind F. Hallinan
Wollmuth Maher & Deutsch LLP
New York, NY
Counsel for Plaintiffs
Louis A. Chaiten
Jones Day
Cleveland, OH
David F. Adler
Michael T. Marcucci
Jones Day
Boston, MA
Samuel L. Walling
Jones Day
Minneapolis, MN
Albert J. Rota
Jones Day
Dallas, TX
Counsel for Defendant U.S. Bank National Association

8/12/2020

14-CV-10116 (VSB)
OPINION & ORDER

VERNON S. BRODERICK, United States District Judge:
Before me is Plaintiffs Phoenix Light SF Limited, Blue Heron Funding VI Ltd., Blue
Heron Funding VII Ltd., Kleros Preferred Funding V PLC, Silver Elms CDO PLC, Silver Elms
CDO II Limited, C-BASS CBO XIV Ltd., and C-BASS CBO XVII Ltd.’s (together “Plaintiffs”)
motion pursuant to Federal Rule of Civil Procedure 59(e) and Local Civil Rule 6.3, (Doc. 423),
seeking reconsideration of my March 18, 2020 Opinion & Order granting Defendant U.S. Bank’s
(“Defendant”) motion for summary judgment, (Doc. 421), and alteration of the Clerk’s
judgment. For the reasons that follow, Plaintiffs’ motion is DENIED.
Procedural History1
On April 15, 2020, Plaintiffs filed the instant motion for reconsideration and to alter the
judgment, supported by a memorandum of law. (Docs. 423, 424.) Defendant filed a
memorandum of law in opposition on May 14, 2020, (Doc. 430), and Plaintiffs filed their reply
memorandum of law on June 1, 2020, (Doc. 432). In addition to these submissions, I consider
the summary judgment record that was considered by me in connection with the Summary
Judgment Opinion & Order, as well as Judge Forrest’s two motion to dismiss opinions and the
parties’ submissions in connection with those opinions.
Legal Standard
Generally, a party seeking reconsideration must show either “‘an intervening change of
controlling law, the availability of new evidence, or the need to correct a clear error or prevent

1

I assume the parties’ familiarity with the background of this action, which is more fully set forth in Judge
Katherine B. Forrest’s two motion to dismiss opinions, see Phoenix Light SF Ltd. v. U.S. Bank Nat’l Ass’n, No. 14CV-10116 KBF, 2015 WL 2359358, at *1 (S.D.N.Y. May 18, 2015) (“Phoenix Light I”); Phoenix Light SF Ltd., et
al. v. U.S. Bank Nat’l Ass’n, No. 14-cv-10116 (KBF), 2016 WL 1169515 (S.D.N.Y. Mar. 22, 2016) (“Phoenix Light
II”), and my March 18, 2020 Opinion & Order granting Defendant U.S. Bank’s motion for summary judgment, see
Phoenix Light SF Ltd. v. U.S. Bank Nat’l Ass’n, No. 14-CV-10116 (VSB), 2020 WL 1285783 (S.D.N.Y. Mar. 18,
2020) (“Summary Judgment Opinion & Order”).

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manifest injustice.’” In re Beacon Assocs. Litig., 818 F. Supp. 2d 697, 701–02 (S.D.N.Y. 2011)
(quoting Catskill Dev., L.L.C. v. Park Place Entm’t Corp., 154 F. Supp. 2d 696, 701 (S.D.N.Y.
2001) (quoting Doe v. NYC Dep’t of Soc. Servs., 709 F.2d 782, 789 (2d Cir. 1983))). “It is wellsettled that Rule 59 is not a vehicle for relitigating old issues, presenting the case under new
theories, securing a rehearing on the merits, or otherwise taking a ‘second bite at the apple’. . . .”
Analytical Surveys, Inc. v. Tonga Partners, L.P., 684 F.3d 36, 52 (2d Cir. 2012), as amended
(July 13, 2012) (quoting Sequa Corp. v. GBJ Corp., 156 F.3d 136, 144 (2d Cir. 1998); Polsby v.
St. Martin’s Press, Inc., No. 97 Civ. 690(MBM), 2000 WL 98057, at *1 (S.D.N.Y. Jan. 18,
2000) (“[A] party may not advance new facts, issues or arguments not previously presented to
the Court.” (citation omitted)). “Rather, ‘the standard for granting [a Rule 59 motion for
reconsideration] is strict, and reconsideration will generally be denied unless the moving party
can point to controlling decisions or data that the court overlooked.’” Analytical Surveys, Inc.,
684 F.3d at 52 (quoting Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995)). Where
the motion “merely offers substantially the same arguments . . . offered on the original motion or
attempts to advance new facts, the motion for reconsideration must be denied.” Silverman v.
Miranda, 2017 WL 1434411, at *1 (S.D.N.Y. Apr. 10, 2017). The decision of whether to grant
or deny a motion for reconsideration is “within ‘the sound discretion of the district court.’”
Premium Sports Inc. v. Connell, No. 10 Civ. 3753(KBF), 2012 WL 2878085, at *1 (S.D.N.Y.
July 11, 2012) (quoting Aczel v. Labonia, 584 F.3d 52, 61 (2d Cir. 2009)).
“Under Rule 59(e), a district court may ‘alter or amend judgment to correct a clear error
of law or prevent manifest injustice.’” Corsair Special Situations Fund, L.P. v. Nat’l Res., 595
F. App’x 40, 44 (2d Cir. 2014) (summary order) (quoting ING Global v. United Parcel Serv.
Oasis Supply Corp., 757 F.3d 92, 96 (2d Cir. 2014) (internal quotation marks omitted)). “The

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‘manifest injustice’ standard is, by definition, ‘deferential to district courts and provide[s] relief
only in the proverbial “rare case.”’” Id. (quoting United States v. Rigas, 583 F.3d 108, 123 (2d
Cir. 2009)). However, as the Second Circuit has observed, “a judgment in a civil case does not
constitute ‘manifest injustice’ where the movant’s arguments for relief ‘were available to the
[party] [] and [the party] proffer[s] no reason for [its] failure to raise the arguments.’” Id.
(quoting In re Johns–Manville Corp., 759 F.3d 206, 219 (2d Cir. 2014) (internal quotation marks
omitted)).
Discussion
Plaintiffs state that judgment was entered against them based upon “one thinly briefed
issue: how champerty supposedly deprived the Court of Article III jurisdiction back in 2015
when Plaintiffs’ indenture trustees assigned their rights to bring claims against U.S. Bank and
other RMBS trustees.” (Doc. 424, at 1.) Throughout Plaintiffs’ motion for reconsideration,
however, Plaintiffs mischaracterize the record, fail to identify any controlling decisions or data
that were overlooked in the Summary Judgment Opinion & Order, and resort to new arguments
not originally presented or suggested in their summary judgment briefing without justification.
A. Plaintiffs’ Litigation Strategy
Plaintiffs’ litigation strategy throughout this case is critical to my analysis of the instant
motion for reconsideration. As outlined by Judge Forrest in Phoenix Light I, Plaintiffs’ CDO
Indentures “indicate[d] that plaintiffs [were] contractually barred from directly asserting claims
as to the [RMBS] certificates at issue in this action, and that such claims belong[ed] to the
indenture trustees.” Phoenix Light I, 2015 WL 2359358, at *2. Judge Forrest made this
observation after concluding that the Granting Clauses in the CDO Indentures constituted a “full
assignment” of Plaintiffs’ rights, title, and interest in the RMBS Certificates. Id. (citing Banque

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Arabe et Internationale D’Investissement v. Maryland Nat. Bank, 57 F.3d 146, 152 (2d Cir.
1995) (under New York law, a contract granting all “rights, title and interest” to another results
in a “transfer” of claims), and Aaron Ferer & Sons Ltd. v. Chase Manhattan Bank, Nat. Ass’n,
731 F.2d 112, 125 (2d Cir. 1984) (“An unequivocal and complete assignment extinguishes the
assignor’s rights . . . and leaves the assignor without standing to sue.” (citation omitted)). In an
attempt to cure this standing defect, Plaintiffs obtained formal assignments from the CDO
Indenture Trustees and filed a Second Amended Complaint.
When faced with a subsequent motion to dismiss brought in part on champerty grounds,
although Plaintiffs had obtained formal assignments and argued that such assignments were
sufficient to satisfy the Court’s standing inquiry, Plaintiffs maintained that the assignments were
not necessary, “respectfully submit[ting] . . . that the Granting Clauses to the [CDO I]ndentures
merely create[ed] a security interest,” but did not deprive Plaintiffs of their rights in the RMBS
certificates. (Doc. 87, at 19.) Judge Forrest squarely rejected this argument, stating that “[s]uch
assignments were necessary” for Plaintiffs to pursue a third party beneficiary breach of contract
claim, because—through the CDO Indentures—Plaintiffs had “‘[g]rant[ed] to the Indenture
Trustee[s]’” all their rights “in the underlying [RMBS] certificates.” Phoenix Light II, 2016 WL
1169515, at *7. Foreshadowing for Plaintiffs the importance of developing an adequate factual
record during discovery to support their argument of their standing to bring a third party
beneficiary breach of contract claim, and the significance of presenting adequate legal arguments
to address Defendant’s champerty defense, Judge Forrest stated at the outset of Phoenix Light II
that “[t]he bulk of the briefing, and the most difficult question for the Court . . . , is, as it had
been in the first round of motion practice, standing.” Phoenix Light II, 2016 WL 1169515, at *1.
Judge Forrest then denied the motion to dismiss on champerty grounds without prejudice, noting

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that she could not resolve the “factually-based” affirmative defense on a motion to dismiss, and
indicating that whether Plaintiffs “had a preexisting proprietary interest” in the RMBS
certificates would be a dispositive issue on summary judgment. Id. (quoting Tr. for the
Certificate Holders of Merrill Lynch Mortg. Inv’rs, Inc. v. Love Funding Corp., 13 N.Y.3d 190,
202 (2009) (answering certified question from Second Circuit)).
On summary judgment, however, Plaintiffs continued to press their already twicerejected argument that the CDO Indenture’s Granting Clauses did not effect a full assignment of
their rights in the RMBS certificates, and relied solely on that strategy to oppose Defendant’s
champerty defense. More specifically, Plaintiffs argued that despite the Granting Clauses, they
continued to “hold securities, including RMBS,” (Pl. Mem. 4),2 and that “while the Plaintiffs
pledged their assets (i.e., the RMBS) to their respective indenture trustees as collateral for their
obligations under their own securities, the ownership of the RMBS remained with Plaintiffs.”
(Pl. Mem. 4.) On this basis, and only on this basis, Plaintiffs argued that they “ha[d] property
interests in the RMBS certificates at issue,” (Pl. Mem. 6), and that they “entered into the
assignments to protect their pre-existing interests in the certificates,” (id. at 7), such that the
assignments were not champertous, (id. at 6–7). During Oral Argument, Plaintiffs continued to
press this argument as the basis for standing:
I think that the problem that we’re having, the disconnect, the two trains passing in
the night, is the misunderstanding of what the grant was. The grant was of a security
interest, in other words, you have a CDO, an issuer, and it issues notes to various
people, and those notes need to be secured by something, and they’re secured by
collateral, and the collateral happens to be the RMBS certificates. But the note
issuer, the one who is getting the debt or getting the money, still owns it, it’s
pledging it. It’s a pledge, as this document says, it’s a grant in trust to an indenture
trustee—which is not a real trust, it’s not an express trust—. . . but the ownership,
the fee remains at all times—even if not the possession—the ownership interest,
2
“Pls. Mem.” refers to Plaintiffs’ Memorandum of Law in Opposition to Bank of America, N.A.’s Motion for
Summary Judgment. (Doc. 320.)

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the propriety interest for our purposes, remains with the issuer at all times from the
very beginning of the day that it issues notes.
(Oral Arg. Tr. 10:6-21.)3 This argument was not only addressed and defeated by Judge Forrest’s
two motion to dismiss opinions rejecting Plaintiffs’ reading of the CDO Indentures—which I
adopted as law of the case—the argument was also incorrect in light of the multiple analogous
cases—which I will not recite again here—holding that the language in the Granting Clauses
effected a complete transfer of Plaintiffs’ rights. (See Summary Judgment Opinion & Order 31–
32.)4 It was based upon this background set forth in the record described above that I stated the
following:
Given the conclusion that the CDO Indentures effected a full transfer of Plaintiffs’
right and title to the RMBS certificates at issue, and my adoption of that conclusion
here, it follows that Plaintiffs conveyed any preexisting proprietary interest in the
RMBS certificates to the CDO Indenture Trustees upon executing the CDO
Indentures. Thus, the reassignments back to Plaintiffs of the CDO Indenture
Trustees’ rights to sue on the RMBS certificates do not fall under the preexisting
proprietary interest exception to the champerty doctrine articulated in Love Funding
Corporation, 13 N.Y.3d at 195. To the extent Plaintiffs could identify other
preexisting proprietary interests in the RMBS certificates, they have not done so
here.
(Id. 34–35.)5

3

“Oral Arg. Tr.” refers to the transcript of Oral Argument held on October 26, 2018. (Doc. 380.)

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The fact that Plaintiffs continued to press an already twice-rejected strategy underscores a central theme of
standing jurisprudence, which involves a “judicial effort to ensure, in every case or controversy, ‘that concrete
adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination.’”
Sprint Commc’ns Co., L.P. v. APCC Servs., Inc., 554 U.S. 269, 288 (2008) (quoting Baker v. Carr, 369 U.S. 186,
204 (1962) and citing Massachusetts v. EPA, 549 U.S. 497, 517 (2007) (“At bottom, the gist of the question of
standing is whether petitioners have such a personal stake in the outcome of the controversy as to assure that
concrete adverseness” (internal quotation marks omitted)). Plaintiffs failed to bring forth that concrete adverseness,
which in the end was fatal to their claims.

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Also crucial to my Summary Judgment Opinion & Order was the fact that Plaintiffs’ summary judgment
opposition papers and Local Civil Rule 56.1 statement identified no genuine factual dispute regarding Plaintiffs’
purpose in obtaining the assignments from the CDO Indenture Trustees. Indeed, as summarized in the Summary
Judgment Opinion & Order, Plaintiffs did not offer any properly supported factual assertions to meet Defendant’s
assertions on this score. Instead, Plaintiffs continued to point to the Granting Clauses in the CDO Indentures,
relying exclusively on the legal argument that they owned the relevant RMBS certificates in an attempt to satisfy the
Love Funding exception to New York’s champerty rule.

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B. Plaintiffs’ New Summary Judgment Arguments
Given the above history, I find unavailing Plaintiffs’ contention that they “did not have
reason to address many of the [standing] issues” raised in my Summary Judgment Opinion &
Order. (Doc. 424, at 5.) In their motion for reconsideration, however, Plaintiffs press myriad
new arguments as to why the Love Funding exception applies in this case, none of which I can
consider. In the Second Circuit, a party that fails to raise an argument in its opposition papers on
a motion for summary judgment has waived that argument. See Triodetic Inc. v. Statue of
Liberty IV, LLC, 582 Fed. Appx. 39, 40 (2d Cir. 2014) (summary order) (“[P]laintiff never raised
these arguments in its opposition to defendants’ motion for summary judgment. Accordingly,
these arguments were waived.”); Aiello v. Stamford Hosp., 487 Fed. Appx. 677, 678 (2d Cir.
2012) (summary order) (“The premise of our adversarial system is that courts do not sit as selfdirected boards of legal inquiry and research, but essentially as arbiters of legal questions
presented and argument by the parties before them.” (quoting Coalition on W. Valley Nuclear
Wastes v. Chu, 592 F.3d 306, 314 (2d Cir. 2009) (quotation marks omitted)); Palmieri v. Lynch,
392 F.3d 73, 87 (2d Cir. 2004) (“[The plaintiff] failed to . . . raise this argument in his opposition
to summary judgment. Thus, this argument has been waived.”). Similarly, in the event that “a
party fails . . . to properly address another party’s assertion of fact as required by Rule 56(c), the
court may,” among other things, “consider the fact undisputed for purposes of the motion” or
“grant summary judgment if the motion and supporting materials—including the facts
considered undisputed—show that the movant is entitled to it.” Fed. R. Civ. P. 56(e)(2), (3); see
also Local Rule 56.1(d) (“Each statement by the movant or opponent pursuant to Rule 56.1(a)
and (b), including each statement controverting any statement of material fact, must be followed
by citation to evidence which would be admissible, set forth as required by Fed. R. Civ. P.

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56(c).”); Fed. R. Civ. P. 56(c)(1)(a) (“A party asserting that a fact cannot be or is genuinely
disputed must support the assertion by . . . citing to particular parts of materials in the record,
including depositions, documents, electronically stored information, affidavits or declarations,
stipulations (including those made for purposes of the motion only), admissions, interrogatory
answers, or other materials.”). Furthermore, Rule 56 “does not impose an obligation on
a district court to perform an independent review of the record to find proof of a factual dispute.”
Amnesty Am. v. Town of W. Hartford, 288 F.3d 467, 470–71 (2d Cir. 2002). Instead, that was
Plaintiffs’ task on summary judgment, especially in this context where “[t]he party invoking
federal jurisdiction bears the burden” to establish standing, Lujan v. Def. of Wildlife, 504 U.S.
555, 561 (1992), and where Plaintiffs’ lack of standing was forecast to be a dispositive issue on
summary judgment after two motion to dismiss opinions addressing the potential pitfalls in
Plaintiffs’ standing argument. (See also Summary Judgment Opinion & Order 22 (“Although
“[a]t the pleading stage, general factual allegations of injury resulting from the defendant’s
conduct may suffice, . . . [i]n response to a summary judgment motion . . . the plaintiff can no
longer rest on such mere allegations, but must set forth by affidavit or other evidence specific
facts . . . ” Lujan, 504 U.S. at 561 (internal quotations and citations omitted).”).) Tellingly,
Plaintiffs’ motion for reconsideration does not even attempt to identify where in their summary
judgment papers the arguments they are now urging me to consider were originally presented,
and my review of those papers confirms that Plaintiffs rested entirely on their interpretation of
the CDO Indentures’ Granting Clauses when making their standing argument. Plaintiffs’ new
legal theories and factual propositions are thus improper on a motion for reconsideration.
Nor do Plaintiffs’ arguments demonstrate manifest injustice, as Plaintiffs provide no real
justification for their failure to raise these arguments—which were no doubt available earlier—in

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their summary judgment briefing. Instead, Plaintiffs state only that they “did not have reason to
address,” (Doc. 424, at 5), these issues in light of the “thinly briefed” nature of Defendant’s
opening brief, (id. at 1). Again, however, the history of this case together with the litigation
strategy Plaintiffs elected in response undermines any notion that Plaintiffs were justified in
failing to raise these arguments.
C. Plaintiffs’ Attempt to Demonstrate Clear Error
Plaintiffs make various arguments in an attempt to demonstrate clear error, each of which
I find meritless. However, for the sake of further clarifying the Summary Judgment Opinion &
Order, I will address two of Plaintiffs’ arguments.
Plaintiffs argue that I conflated Article III standing and prudential standing, stating that
[c]onstitutional standing is jurisdictional; it is not dependent on what type of cause
of action (contract or tort) the plaintiff may (or may not) be able to state as a matter
of Fed. R. Civ. P. 12(b)(6) so long as the plaintiff has some legally protectable
interest that may potentially be redressed if he, she or it also meets the requirements
of prudential standing.
(Doc. 424, at 11.) However, Article III standing jurisprudence is more nuanced than Plaintiffs
represent. In fact, “[s]tanding is not dispensed in gross[;] [r]ather, a plaintiff must demonstrate
standing for each claim he seeks to press and for each form of relief that is sought.” Davis v.
Fed. Election Comm’n, 554 U.S. 724, 734 (2008) (internal quotation marks and citations
omitted); Keepers, Inc. v. City of Milford, 807 F.3d 24, 42 (2d Cir. 2015); (see also Summary
Judgment Opinion & Order 22). In this case, Plaintiffs asserted breach of contract claims—the
contracts being the pooling and servicing agreements (“PSAs”) that governed Defendant’s
duties—but because Plaintiffs were not parties to the PSAs, Plaintiffs’ claims were premised on
their status as third party beneficiaries to the PSAs by virtue of their alleged direct ownership of
the RMBS certificates. (Third Amended Complaint, Doc. 209 ¶¶ 10–17 (Plaintiff bring these

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claims “in [their] own right as [ ] CDO Issuer[s] that hold[ ] Certificates that were issued by
certain of the Covered Trusts . . . .”).) Because Plaintiffs asserted only breach of contract claims
premised on the direct ownership of the RMBS certificates, to “have legal title to, or a
proprietary interest in, the [contract] claim[s] [at issue],” Cortlandt St. Recovery Corp., 790 F.3d
at 420 (quoting W.R. Huff Asset Mgmt. Co., LLC, 549 F.3d at 108), Plaintiffs would indeed need
to directly own the RMBS certificates; such direct ownership being the only means by which
Plaintiffs could be considered third party beneficiaries to the PSAs. Because the inevitable result
of the Granting Clauses in the CDO Indentures was an absence of such ownership, Plaintiffs
simply had no contract rights to vindicate, and therefore lacked Article III standing to bring
breach of contract claims in the absence of a valid assignment. See Cortlandt St. Recovery
Corp., 790 F.3d at 422 (“[A]bsent a complete assignment of the only claims on which the lawsuit
was based, there was no valid lawsuit pending before the district court in which to permit an
amended complaint.”).6
Plaintiffs seek to escape this conclusion with the following argument:
The plaintiff in Cortlandt Street Recovery claimed that it was an assignee for
collection with Article III standing pursuant to Sprint Commc’ns Co., L.P. v. APCC
Services, Inc, 554 U.S. 269 (2008). See Cortlandt St. Recovery, 790 F.3d at 41718. It did not claim “direct injury,” as Plaintiffs do here. Id. The Second Circuit
held that because of a defect in language in the assignment for collection, the
plaintiff there received only a power of attorney to sue, not a chose in action in
which it acquired a proprietary interest; therefore, it could not allege injury-in-fact.
Id. at 418. Although cited numerous times in the [Summary Judgment Opinion &]
Order, Cortlandt Street Recovery is irrelevant to the constitutional standing of the
CDO Issuers.
(Doc. 424, at 11 n.6.) Not so. Plaintiffs’ error in reading the Summary Judgment Opinion &

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In Part III(A)(1) and at footnote 20 of the Summary Judgment Opinion & Order, I describe in more detail why—
given the fact that Plaintiffs’ only claims are breach of contract claims—Second Circuit precedent has relied on both
Article III standing and prudential standing doctrines in this context. Plaintiffs’ argument that I conflated these
principles is of no moment, however, because the Summary Judgment Opinion & Order concluded that Plaintiffs
lacked both constitutional and prudential standing to bring this breach of contract action.

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Order lies in their Sisyphean attempt to continue arguing that they directly owned the RMBS
certificates despite executing the CDO Indentures, which would establish a “direct injury.” But
again, the lack of such ownership left Plaintiffs with no contract rights to pursue such that a valid
assignment was necessary to establish Article III standing per Cortlandt Street Recovery and
Sprint.
Plaintiffs’ next error is their assertion that I “concluded, erroneously, that the pre-existing
proprietary interest that brings a plaintiff within the exception to champerty announced in Love
Funding is identical to the injury-in-fact that is required to establish Article III standing.” (Doc.
424, at 9.) I made no such conclusion. Instead, the Summary Judgment Opinion & Order
assessed Plaintiffs’ only attempt to identify a pre-existing proprietary interest—their alleged
continued ownership of the RMBS certificates—and concluded that because Plaintiffs’ argument
was invalid, Plaintiff failed to identify any pre-existing proprietary interest sufficient to uphold
the assignments under Love Funding. (See Summary Judgment Opinion & Order 34–35.)
Accordingly, because the assignments that gave rise to Plaintiffs’ standing were void under New
York champerty law the two inquiries collapsed, but only by Plaintiffs’ design. In fact, it was
Plaintiffs that initially intertwined the pre-existing proprietary interest exception to champerty
and Article III’s injury-in-fact requirement by citing only their interpretation of the CDO
Indentures’ Granting Clauses to satisfy both tests.

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Conclusion
For the foregoing reasons, Plaintiffs’ motion for reconsideration and to amend the
judgment is DENIED. The Clerk of Court is respectfully directed to terminate the open motion
at Document 423.
SO ORDERED.
Dated: August 12, 2020
New York, New York
______________________
Vernon S. Broderick
United States District Judge

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