Citigroup Glob. Mkts., Inc. v. KLCC Invs., LLC, D and D Trust
706 F. App'x 38
| 2d Cir. | 2017Background
- Interpleader action filed in 2006 by Citigroup Global Markets, holder of an account containing pledged securities twice pledged by Solomon Dwek.
- District court Sept. 28, 2015 granted summary judgment for KLCC Investments and Cayre; dismissed D&D's cross-claims and all Citigroup counterclaims; discharged Citigroup and denied attorneys' fees without prejudice.
- District court Jan. 24, 2017 awarded Citigroup $246,125.15 in fees and costs against D&D, holding KLCC priority over D&D to the securities account.
- D&D appeals both the summary judgment and the fee/costs award.
- Appellate review: de novo for summary judgment; abuse of discretion for fee award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether KLCC had priority over D&D to the securities account | D&D contends no priority or disputed holdings. | KLCC argues it has legal priority over D&D to the account. | KLCC entitled to summary judgment; priority established. |
| Whether the district court abused its discretion in awarding Citigroup fees and costs against D&D | D&D asserts the fee award was improper or excessive. | Citigroup argues the award was proper against the losing claimant. | District court's award affirmed; proper against D&D. |
Key Cases Cited
- Globe Indem. Co. v. Puget Sound Co., 154 F.2d 249 (2d Cir. 1946) (interpleader costs generally bore by losing claimant; exception for special circumstances)
- In re Bank of N.Y. Derivative Litig., 320 F.3d 291 (2d Cir. 2003) (summary judgment standard; de novo review)
- Septembertide Publ'g, B.V. v. Stein & Day, Inc., 884 F.2d 675 (2d Cir. 1989) (costs and attorneys' fees may be taxed against a party when warranted; abuse of discretion standard)
- Alibrandi v. Fin. Outsourcing Servs., Inc., 333 F.3d 82 (2d Cir. 2003) (summary judgment standard; facts viewed in light most favorable to non-moving party)