923 F. Supp. 2d 491
S.D.N.Y.2013Background
- Woori filed this action on May 18, 2012 asserting fraud, rescission, negligent misrepresentation, and unjust enrichment arising from a $143 million investment in seven CDOs.
- Merrill Lynch moved to dismiss the Complaint based on the statute of limitations; Woori argued that the FCIC report (Jan. 27, 2011) reset or tolled the limitations clock.
- New York’s borrowing statute (C.P.L.R. § 202) applies because Woori is a nonresident and accrual is governed by the jurisdiction where the injury occurred.
- Under the borrowing statute, accrual occurs where the injury is sustained; here, Woori’s injury was economic and occurred in Korea, where it is resident.
- Korean law provides a three-year statute of limitations; the Court applied Korean law because it is shorter than New York’s six-year period, and found Woori’s claims time-barred.
- The FCIC Report was not the definitive trigger for accrual, and discovery breadth in Korea did not delay accrual; substantial pre-May 18, 2009 information supported notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Woori’s claims accrued in Korea under the borrowing statute. | Woori claims FCIC 2011 release as accrual trigger. | Accrual should be recognized早 under NY/US standards. | Accrual occurred in Korea; not time-barred under Korean law. |
| Whether the FCIC Report marks the practical ability to sue in Korea. | FCIC 2011 report was necessary to practically file. | No requirement that FCIC report exists to sue; preexisting evidence suffices. | FCIC not the benchmark; pre-2009 evidence sufficed for notice. |
| Whether the discovery rule or inquiry notice tolled the limitations period. | Discovery breadth in Korea would delay accrual. | Notice standard met by pre-2009 evidence; FCIC not required. | No tolling; notice existed prior to May 18, 2009. |
Key Cases Cited
- Ghartey v. St. John’s Queens Hosp., 869 F.2d 160 (2d Cir. 1989) (statute of limitations under Rule 12(b)(6)—notice and accrual considerations)
- Chambers v. Time Warner, Inc., 282 F.3d 147 (2d Cir. 2002) (pleading standard; plausible claim required)
- First Nationwide Bank v. Gelt Funding Corp., 27 F.3d 763 (2d Cir. 1994) (Twombly-like plausibility standard for pleadings)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (S. Ct. 2007) (pleading standard; allegations must raise plausible entitlement to relief)
- In re Coudert Bros. LLP, 673 F.3d 180 (2d Cir. 2012) (borrowing statute and accrual issues in a complex case)
- Stuart v. Am. Cyanamid Co., 158 F.3d 622 (2d Cir. 1998) (choice-of-law and accrual considerations in borrowing-statute context)
- Antone v. Gen. Motors Corp., 64 N.Y.2d 20 (1984) (New York discovery and accrual principles for limitations periods)
- Global Fin. Corp. v. Triarc Corp., 93 N.Y.2d 525 (1999) (economic injury accrual location for limitations purposes)