Cedarwoods CRE CDO II, Ltd. v Galante Holdings, Inc.

Cedarwoods CRE CDO II, Ltd. v Galante Holdings, Inc. 2012 NY Slip Op 04946 Decided on June 19, 2012 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on June 19, 2012
Sweeny, J.P., Catterson, Acosta, Freedman, Román, JJ.
7988 653624/11

[*1]Cedarwoods CRE CDO II, Ltd., et al., Plaintiffs-Appellants,

v

Galante Holdings, Inc., et al., Defendants-Respondents, Hotspur Resorts Nevada, Ltd., et al., Defendants.




Allen & Overy LLP, New York (Jacob S. Pultman of counsel),
for appellants.
Squire Sanders (US) LLP, New York (Alan Heblack of
counsel), for Galante Holdings, Inc., respondent.
McKenna Long & Aldridge LLP, New York (Charles E.
Dorkey III of counsel), for Trimont Real Estate Advisors, respondent.
Polsinelli Shughart, New York (Daniel J. Flanigan of counsel),
for KeyCorp Real Estate Capital Markets, Inc., respondent.

Order, Supreme Court, New York County (Melvin L. Schweitzer, J.), entered on or about January 4, 2012, which denied plaintiffs' motion for a preliminary injunction and dissolved a temporary restraining order issued on December 28, 2011, unanimously affirmed, with costs. The stay granted by this Court by order entered February 14, 2012 is continued for 45 days from the date of service of the order on this appeal with notice of entry.

The court properly denied plaintiffs' motion seeking to enjoin defendants from taking any action to transfer the mortgage loan, which was part of a securitization trust, to defendant Galante Holdings, Inc. The court properly found that plaintiffs failed to comply with the pooling and servicing agreement's "no-action" clause. That clause provides that no certificate holder has the right to bring any suit unless the holders of certificates representing interests of at least 25% of "each affected [c]lass" shall have first given notice to a trustee requesting that the suit be brought and the trustee shall not bring the suit within a 60-day period. Plaintiffs only hold an interest in two of the affected classes constituting far less than the required 25%. Furthermore, they did not obtain the consent of any other classes before commencing this action.

Moreover, even if plaintiffs could show that they were not required to comply with the "no action" clause before commencing this action, they failed to demonstrate that they were otherwise likely to succeed on the merits of their claims, that they would suffer irreparable injury in the absence of an injunction and that a balance of the equities tips in their favor (see generally [*2]Nobu Next Door, LLC v Fine Arts Hous., Inc., 4 NY3d 839 [2005]; see also CPLR 6301).

We have considered plaintiffs' remaining arguments and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: JUNE 19, 2012

DEPUTY CLERK