2138747 Ontario, Inc., Appellant,v.Samsung C&T Corporation, et al., Respondents.BriefN.Y.April 24, 2018To be Argued by: GRANT A. HANESSIAN (Time Requested: 30 Minutes) APL # 2017-00129 New York County Clerk’s Index No. 653270/14 Court of Appeals of the State of New York 2138747 ONTARIO, INC., Plaintiff-Appellant, – against – SAMSUNG C&T CORPORATION, SAMSUNG AMERICA, INC. and SAMSUNG C&T AMERICA, INC. (f/k/a Samsung America, Inc.), Defendants-Respondents. BRIEF FOR DEFENDANTS-RESPONDENTS Of Counsel: GRANT A. HANESSIAN JACOB M. KAPLAN BAKER & MCKENZIE LLP Attorneys for Defendants-Respondents 452 Fifth Avenue New York, New York 10018 Tel.: (212) 626-4100 Fax: (212) 310-1600 Date Completed: October 5, 2017 CORPORATE DISCLOSURE STATEMENT Pursuant to Rule 500.1(f), Defendants-Respondents disclose the following. The ultimate parent entity of Defendant-Respondent Samsung C&T Corp. is Samsung Group. The subsidiaries and affiliates of Defendant-Respondent Samsung C&T Corp. are: • Seoul Lakeside Co., Ltd. • Samoo Architects & Engineers Co., Ltd. • CVnet Corporation • Myodo Metal Co., Ltd. • Samsung C&T Japan Corporation • Samsung C&T America, Inc. • Samsung Oil & Gas USA Corp. • Samsung Renewable Energy, Inc. • Samsung Green Repower, LLC • SCNT Power Norte S. de R.L. de C.V. • Samsung E&C America, Inc. • Samsung Solar Construction, Inc. • QSSC, S.A. de C.V. • Samsung C&T Oil & Gas Parallel Corp. • Parallel Petroleum LLC • SRE GRW EPC GP, Inc. • SRE GRW EPC LP • SRE SKW EPC GP, Inc. • SRE SKW EPC LP • Samsung C&T Canada Ltd. • PLL Holdings LLC • SRE GRW LP Holdings LP • SRE SKW LP Holdings LP • SRE WIND PA GP Inc. • SRE WIND PA LP • PLL E&P LLC • SRE GRS Holdings GP Inc. • SRE GRS Holdings LP • SRE K2 EPC GP Inc. • SRE K2 EPC LP • SRE KS Holdings GP Inc. • SRE KS Holdings LP • SRE Belle River LP Holdings LP • SRE Armow EPC GP Inc. • SRE Armow EPC LP • SRE Armow LP Holdings LP • SRE North Kent 1 LP Holding LP • SRE Wind GP Holdings, Inc. • SRE North Kent 2 LP Holdings LP • SRE Solar Development GP Inc. • SRE Solar Development LP • SRE Windsor Holdings GP Inc. • SRE Southgate Holdings GP Inc. • SRE Solar Construction Management GP Inc. • SRE Solar Construction Management LP • SRE Development GP Inc. • SRE Development LP • SRE BRW EPC GP Inc. • SRE BRW EPC LP • SRE NK1 EPC GP Inc. • SRE NK1 EPC LP • SRE North Kent 1 GP Holdings Inc. • SRE North Kent 2 GP Holdings Inc. • SRE Belle River GP Holdings Inc. • SRE Summerside Construction GP Inc. • SRE Summerside Construction LP • Samsung C&T Deutschland GmbH • Samsung C&T U.K. Ltd. • Samsung C&T ECUK Limited • Whessoe Engineering Limited • POSS-SLPC S.R.O. • Solluce Romania 1 B.V. • Ecosolar OOD • Ecoenergy Solar OOD • Agriplam EOOD • Fishtrade EOOD • Manageproject EOOD • Solar Park EOOD • Veselinovo Energy OOD • Samsung C&T Construction Hungary Kft. • Samsung C&T (KL) Sdn. Bhd. • Samsung C&T Malaysia Sdn. Bhd. • Samsung Chemtech VINA • S-Print • Samsung C&T (Thailand) Co., Ltd. • PT. Insam Batubara Energy • Samsung C&T India Private Ltd. • Samsung C&T Corporation India Private Ltd. • MSSC Sdn.,Bhd. • Samsung C&T Singapore Pte. Ltd. • S&G Bio Fuel Pte. Ltd. • PT Gandaerah Hendana • PT Inecda • Samsung C&T Mongolia LLC • Samsung C&T Eng.&Const. Mongolia LLC • S&Woo Construction Philippines, Inc. • Samsung (Tianjin) International Trading Co., Ltd. • Samsung Trading (Shanghai) Co., Ltd. • Samsung C&T Hongkong Limited • Guang Dong Xingpu Steel Center Co., Ltd. • Samsung C&T Taiwan Co., Ltd. • Samsung Precision Stainless Steel (Pinghu) Co., Ltd. • Samsung C&T Co., (Guangzhou) Ltd. • Samsung C&T (Shanghai) Co., Ltd. • Samsung C&T (Xi’an) Co., Ltd. • Samsung C&T Corporation Saudi Arabia • Samsung C&T Chile Copper SpA • Pampa Camarones S.A. • SCNT Power Kelar Inversiones LTDA. • Samsung C&T do Brasil Construtora LTDA • S.C. Otelinox S.A. • Samsung Corporation Rus LLC • Samsung BioLogics Co., LTd. • Cheil Fashion Retail Co., Ltd. • Natural 9 Co., Ltd. • Cheil Industries Corp., USA • Cheil Industries Italy S.R.L. • Colombo Via della Spiga S.R.L. • Samsung Fashion Trading Co., Ltd. • Samsung Welstory Inc. • Cheil Industries Inc. Vietnam Co., Ltd. • Welstory Vietnam Co., Ltd. • Samsung C&T Corporation UEM Construction JV Sdn. Bhd. • Shanghai Ever Hongjun Business Management Service Co., Ltd. • Shanghai Welstory Food Company Limited • Eight Seconds (Shanghai) Co., Ltd. • Eight Seconds (Shanghai) Trading Co., Ltd. • Meadowland Distribution, Inc. Defendant-Respondent Samsung C&T Corp. is the parent of Defendant- Respondent Samsung C&T America, Inc. (formerly known as Samsung America, Inc.). Samsung C&T America, Inc. has the following corporate subsidiaries and affiliates: • Samsung Oil & Gas USA Corp. • Samsung Green Repower, LLC • Solar Projects Solutions, LLC • Monument Power LLC • Samsung Solar Construction, Inc. • QSSC, S.A. de C.V. • S-Print • Meadowland Distribution, Inc. • Samsung Solar Energy, LLC • Samsung Solar Energy 1, LLC New York, New York October 5, 2017 Dated: Respectfully submitted, k McjCENZIE LLPB. By: Ay Grant A. Hanessian 'Jacob M. Kaplan 452 Fifth Avenue New York, New York 10018 (212) 626-4100 Attorneys for Defendants-Respondents Samsung C&T Corp., Samsung America, Inc., and Samsung C&T America, Inc. (f/k/a Samsung America, Inc.) i Table of Contents I. Introduction ...........................................................................................1 II. Questions Presented ...............................................................................5 III. Background ............................................................................................6 IV. Argument ...............................................................................................9 A. The Appellate Division correctly held that when parties choose New York’s procedural rules, such rules include CPLR 202 .......................................................................9 1. CPLR 202 applies in contracts—like the one here—calling for “enforcement” under New York law ............................................................................9 2. CPLR 202 applies in contracts where New York’s procedural rules are selected through a choice-of-forum provision ............................................. 13 B. Ministers & Missionaries Benefit Board v Snow does not overrule Court of Appeals precedent ................................. 15 C. Plaintiff-Appellant’s “disparate treatment” argument does not justify departure from Court of Appeals precedent .................................................................................. 20 D. There is no indication the parties attempted to exclude CPLR 202 from New York’s procedural rules or their contract ..................................................................................... 21 E. Even had the parties attempted to exclude CPLR 202 from New York’s procedural rules or their contract, it would have no impact in this matter ........................................ 23 V. Conclusion .......................................................................................... 24 ii Table of Authorities Page(s) Cases 151 W. Assocs. v. Pinstripes Fabric Corp., 61 NY2d 732 [1984] ................................................................................ 22 Ackerman v Price Waterhouse, 252 AD2d 179 [1st Dept 1998] ............................................................... 20 All Children’s Hosp., Inc. v Citigroup Global Mkts., Inc., Index No. 162155/2014, 2016 NY Misc LEXIS 3122, [Sup Ct, NY County, 2016], aff’d 2017 NY App Div LEXIS 4961 [1st Dept June 20, 2017] .................................................................... 14, 15 Georgia Malone & Co. v Rieder, 86 AD3d 406 [1st Dept 2011] ................................................................. 19 Global Fin. Corp. v Triarc Corp., 93 NY2d 525 [1999] .......................................................................... 14, 17 Great N. Ins. v Interior Constr. Corp., 7 NY3d 412 [2006] .................................................................................. 19 Insurance Co. of N. America v. ABB Power Generation Inc., 91 NY2d 180 [1997] ......................................................................... passim Matter of Investec (US) Inc. v Baron, 2 Misc 3d 1002(A), 2004 NY Slip Op 50081(U) [Sup Ct, NY County 2004] .............................................................................. 11, 12 IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A., 20 NY3d 310 [2012] ..................................................... 15, 18, 20, 24 John J. Kassner & Co. v City of New York, 46 NY2d 544 [1979] ........................................................................ 4, 5, 23 iii Joseph Gunnar & Co., LLC v Bridgeman, 14 Misc 3d 1238(A), 836 NYS2d 499, 2007 NY Slip Op 50419(U) [Sup Ct, Nassau County 2007] ................................................ 11 Ledwith v. Sears Roebuck & Co., 231 AD2d 17 [1st Dept 1997] ................................................................. 20 Lehman Bros. Holdings Inc. v Universal Am Mortg. Co., LLC, 12 F Supp 3d 1355 (D. Col. 2014) .......................................................... 18 Lehman Bros. Holdings Inc. v Universal Am. Mortg. Co., LLC, No. 13-cv-00090, 2014 US Dist LEXIS 92431 (D. Colo. July 8, 2014) ............................................................................................ 18 Lerner v Prince, 119 AD3d 122 [1st Dept 2014] ............................................................... 13 Ministers & Missionaries Benefit Bd. v Snow, 26 NY3d 466 [2015] ......................................................................... passim Matter of Painewebber, Inc. (Rochester), NYLJ, Oct. 7, 1993, [Sup Ct, NY County, Schoenfeld, J.] ............... 12, 21 Seymour v Victor Balata Belting Co., 174 Misc 2d 677 [Sup Ct, Monroe County 1997] ................................... 22 Smith Barney, Harris Upham & Co. v. Luckie, 91 NY2d 180 [1997] ......................................................................... passim Smith Barney, Harris Upham & Co. v. Luckie, 245 AD2d 17 [1st Dept 1997] .......................................................... passim Statutes CPLR 101 ...................................................................................................... 16 CPLR 201 ................................................................................................ 16, 23 CPLR 202 ............................................................................................... passim EPTL 3-5.1(b)(2) .............................................................................................4 iv General Obligations Law Section 5-1401..................................................... 19 General Obligations Law Section 17-103(3) ................................................ 23 Other Authorities Assembly Bill No. 7307-A, Bill Jacket, L 1984, ch 421 .............................. 19 Restatement [Second] of Conflicts of Laws Section 142(1) [1971] ....................................................................................................... 19 Restatement [Second] of Conflicts of Laws Section 187(3) [1971] ....................................................................................................... 18 1 I. Introduction Plaintiff-Appellant, 2138747 Ontario, Inc. is a shell corporation. It has no employees, conducts no business, owns no technology and has no trade secrets. Plaintiff-Appellant brought the instant claim against Defendants- Respondents Samsung C&T Corporation, Samsung America, Inc., and Samsung C&T America, Inc. (f/k/a Samsung America, Inc.) (collectively, “Samsung”) on behalf of a defunct Canadian wind and solar power company, SkyPower Corp. (“SkyPower”), via an assignment in the Canadian bankruptcy courts. This claim is meritless, and PricewaterhouseCoopers Inc. (“PwC”), SkyPower’s bankruptcy trustee, refused to bring it. Once brought by Plaintiff-Appellant, this claim was dismissed as time-barred by the trial court based on long-established precedent that when parties choose New York procedural rules to govern their disputes, such rules include CPLR 202—the New York borrowing statute. Plaintiff-Appellant appealed, arguing that the decision conflicted with two recent Court of Appeals cases. The First Department rejected this argument and affirmed the trial court in a unanimous opinion, finding no 2 conflict and noting that any policy issues raised by Plaintiff-Appellant were “best left to the state legislature to resolve.” The First Department then denied Plaintiff-Appellant’s motion for leave to appeal to this Court. This Court granted leave to appeal. Plaintiff-Appellant thus now asks this Court—as it previously and unsuccessfully asked the trial court and appellate court—to resurrect its claim by revisiting and overruling the established principle that, when parties choose New York procedural rules to govern their contract, such rules include CPLR 202—the New York borrowing statute. This request should not be entertained. This Court has explicitly held that when parties choose New York procedural rules—either by agreeing to enforce their contracts under New York law, or by choosing New York as the venue for their disputes—such procedural rules include the New York borrowing statute. Thus, in Smith Barney, Harris Upham & Co. v Luckie, where the parties had incorporated New York procedural rules by requiring “enforcement” of their contracts under New York law—the exact language used here—this Court explicitly referenced “the New York borrowing statute (CPLR 202),” and specifically instructed the Appellate Division how 3 to apply that statute in the type of securities fraud actions at issue in Luckie. See id., 85 NY2d 193, 207-08 [1995]; see also Smith Barney, Harris Upham & Co. v Luckie, 245 AD2d 17, 18 [1st Dept 1997] (holding on remand that where the parties had agreed that their contract would be governed by the procedural rules of New York, “determination of the governing limitations period under New York law requires application of New York’s borrowing statute.”). No different result has been reached where the parties incorporate New York procedural rules into their contract by a choice of forum provision. Thus, in Insurance Co. of N. America v ABB Power Generation Inc., this Court held that CPLR 202 is “part of this State’s procedural code” and “requires that a court, when presented with a cause of action accruing outside New York, should apply the limitation period of the foreign jurisdiction if it bars the claim.… It matters not that … the parties have contracted to be venued in this State.” 91 NY2d 180, 187-88 [1997] (emphasis added). The case of Ministers & Missionaries Benefit Bd. v Snow, 26 NY3d 466 [2015] (“MMBB”) does not affect—much less overrule—the holdings in these cases. It simply stands for the proposition that when parties have 4 chosen the substantive law of New York to govern their dispute, a court should not look to New York’s statutory choice-of-law provisions, like EPTL 3-5.1(b)(2), to apply the substantive law of a different state, as this would upset the parties’ expectations. Yet even if MMBB can be read to overrule, sub silencio, this Court’s decisions in Luckie and ABB Power Generation Inc., it would not change the result here. Under New York’s CPLR 201, New York’s General Obligations Law § 17-103, and related case-law, a party is only be permitted to contract around CPLR 202 to shorten the applicable statute of limitations. Agreements to extend the statute of limitations made before a cause of action accrues are unenforceable. See McKinney’s Cons Laws of NY, Book 7B, CPLR 201 (an action must be commenced “within the time specified in this article”—which article includes CPLR 202—“unless … a shorter time is prescribed by written agreement.”); McKinney’s Cons Laws of NY, Book 23A, General Obligations Law § 17-103 [2010] (providing that a promise to waive, extend or not plead the statute of limitations can be made only after accrual of a cause of action); see also John J. Kassner & Co. v City of New York, 46 NY2d 544, 551 [1979] (same). 5 Thus, because the trial court would have been required by the CPLR to apply a two-year statute of limitations in the absence of a contractual provision to the contrary, the parties could not extend that limitations period in an agreement, like the one here, made before accrual of the cause of action. See id. Because (1) precedent makes clear that CPLR 202—the New York borrowing statute—is part of the New York procedural rules, (2) MMBB does not overrule this precedent, and (3) the parties could not in any event lengthen the statute of limitations by contracting around CPLR 202, this Court should affirm the decisions below. II. Questions Presented 1. Did the Appellate Division correctly follow established precedent to hold that when parties choose New York’s procedural rules, such rules include CPLR 202? 2. Does Ministers and Missionaries Benefit Bd. v Snow overrule this established precedent? 3. If Ministers and Missionaries Benefit Bd. v Snow did overrule this established precedent, could the parties lengthen the otherwise applicable statute of limitations period by contract? 6 III. Background SkyPower was a Canadian renewable energy developer. [Record on Appeal (“R”) at 129.] When SkyPower’s majority shareholder explored strategic alternatives to sell or recapitalize SkyPower, SkyPower engaged a financial advisor to contact a large number of potential investors. [R-155- 156.] Samsung was one of these potential investors, and entered into an NDA with SkyPower on or around September 26, 2008. [R-74.] Separately, on December 12, 2008, Samsung entered into a Memorandum of Understanding with the Ontario Ministry of Energy to initiate a new renewable energy project. [R-80.] Plaintiff-Appellant now alleges that Samsung used SkyPower’s proprietary information to win this contract. [R- 80.] On August 12, 2009, SkyPower sought protection from its creditors in Canada pursuant to the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 [Can.], in the Superior Court of Justice in Ontario. [R-185.] That same day, the Ontario Court entered an order that commenced a proceeding for the corporate reorganization of SkyPower. [R-185.] 7 According to Plaintiff-Appellant, on September 26, 2009, SkyPower learned that “Samsung had made a project proposal to the Ministry of Energy, which was accepted, that was based on [SkyPower’s] confidential information.” [R-81.] PwC later became the receiver for SkyPower , and on October 23, 2013, filed an assignment into bankruptcy for SkyPower in Canada and became the bankruptcy trustee for SkyPower. [R-117.] Plaintiff-Appellant was not a creditor of SkyPower. [R-113-114.] On October 26, 2014, Plaintiff-Appellant sought and received an assignment of certain creditor claims against the SkyPower bankruptcy estate. [R-116-120.] Plaintiff-Appellant thereby became an unsecured creditor of the SkyPower estate. In its capacity as a creditor of SkyPower through this assignment, Plaintiff-Appellant wrote to PwC asking the bankruptcy trustee to commence and prosecute proceedings to enforce SkyPower’s supposed claims against Samsung. [R-105-106, 121-122.] PwC refused. [R-106, 124.] (“[h]aving considered your request, the Trustee does not intend to commence proceedings against Samsung …”) 8 Plaintiff-Appellant then petitioned the Ontario Superior Court of Justice to permit an assignment of SkyPower’s claims against Samsung, so that Plaintiff-Appellant could commence proceedings in its own name against Samsung. [R-195-199.] The Ontario Court permitted the assignment by order dated October 27, 2014. [R-200-207.] By summons with notice, filed October 27, 2014, Plaintiff-Appellant commenced this action on behalf of SkyPower, asserting SkyPower’s purported claims against Samsung. [R-208-214.] Plaintiff-Appellant later filed a complaint, on December 8, 2014, again asserting SkyPower’s purported claims against Samsung on behalf of SkyPower. [R-215-232.] Samsung moved to dismiss these claims on December 29, 2014, asserting, inter alia, that SkyPower’s claims were time-barred pursuant to the New York borrowing statute and Ontario’s Limitations Act, 2002, S.O. 2002, c. 24, Sched. B. [R-233-245.] In response, on January 13, 2015, Plaintiff-Appellant filed a First Amended Complaint, in which it asserted essentially the same claims, but now also purportedly on behalf of a New York-based entity. [R-73-74.] Samsung again moved to dismiss the SkyPower claims on statute of limitations grounds, and to dismiss the claims of the other entity for lack of 9 standing. Following oral argument, the trial court dismissed the SkyPower claims as time-barred under the Canadian two-year statute of limitations, and dismissed the other entity’s claims for lack of standing. [R-52, 62.] With respect to the SkyPower claims, the trial court held that when applying the parties’ agreement to employ New York’s procedural rules, “I have to look at all the CPLR provisions … and that … includes [CPLR] 202, the borrowing statute.” [R-54.] Finding that the economic injury occurred in Canada, that the applicable Canadian statute of limitations was two years, and that the claim accrued in 2009, the trial court held that SkyPower claims were barred under CPLR 202. [R-54-55.] In the instant appeal, Plaintiff-Appellant challenges only the dismissal of the SkyPower claims: specifically, whether CPLR 202 applies. IV. Argument A. The Appellate Division correctly held that when parties choose New York’s procedural rules, such rules include CPLR 202 1. CPLR 202 applies in contracts—like the one here— calling for “enforcement” under New York law. The leading case on whether contracts calling for “enforcement” under New York law require application of New York’s procedural rules is Smith Barney, Harris Upham & Co. v Luckie. Plaintiff-Appellant thus 10 originally claimed that Luckie was the “unimpeachable foundation” on which it had built its argument. See Pl. Sup. Ct. Brief at 6 [NYSCEF No. 19]. Plaintiff-Appellant later recognized, and conceded at oral argument, that Luckie “is a bad case for us.” [R-51.] It is easy to see why. Later in its opinion, this Court indicated that when New York’s procedural rules are invoked by the parties, such rules include CPLR 202. See Luckie, 85 NY2d at 206-207. This Court specifically instructed the Appellate Division to address the borrowing statute on remand, and explained how the New York borrowing statute must be applied for security fraud claims like the ones at issue. Id. at 207. On remand, the Appellate Division agreed that “determination of the governing limitations period under New York law requires application of New York’s borrowing statute.” Smith Barney, Harris Upham & Co. v Luckie, 245 AD2d 17, 18, 665 NYS2d 74, 75 [1st Dept 1997]. The Appellate Division went on to find that, because Respondents were Florida residents, whose claims accrued in Florida, that the shorter of the Florida or New York 11 statute of limitations must be applied pursuant to CPLR 202. See 245 AD2d at 18-19, 665 NYS2d at 75-76.1 Other New York courts have reached the same conclusion as this Court and the Appellate Division in Luckie. In Joseph Gunnar & Co., LLC v Bridgeman, 14 Misc 3d 1238(A), 836 NYS2d 499, 2007 NY Slip Op 50419(U), *2 [Sup Ct, Nassau County 2007], the court considered a Client Account Agreement that “provides for a New York choice of law, including enforcement.” Id. at *2. The court explained that in such situation, the New York borrowing statute, CPLR 202, required application of the shorter Illinois statute of limitations. See id. (but finding that the parties had left this issue to the arbitrators). Similarly, in Matter of Investec (US) Inc. v Baron, 2 Misc 3d 1002(A), 2004 NY Slip Op 50081(U), *2 [Sup Ct, NY County 2004], the court held 1 Plaintiff-Appellant attempts to characterize the Luckie matter as a lightly litigated pro se case, that did not address the issue of whether CPLR 202 applied. This is misleading. As this Court recognized in its opinion, the parties “engaged in extensive State and Federal litigation” and “argued that New York’s borrowing statute—CPLR 202—required that the shorter of either New York’s or Virginia’s Statutes of Limitation applied.” See id., 85 NY2d at 198-199. All of the multiple plaintiffs in Luckie were also plainly represented by counsel before this Court. See id. On remand, however, no briefs were filed because this Court’s decision and instructions to the Appellate Division were unambiguous; there was simply nothing left to litigate. 12 that in “[a]pplying New York law in accordance with the parties’ agreement” the court must consider CPLR 202 and incorporate the shorter Virginia statute of limitations. Id. at *2. The same result was obtained in Matter of Painewebber, Inc. (Rochester), NYLJ, Oct. 7, 1993, at 2, col 6 [Sup Ct, NY County, Schoenfeld, J.], where the client agreement mandated that the agreement “and its enforcement shall be construed and governed by the laws of the State of New York.” The court found that this language “must be read to incorporate New York procedural law into the parties’ choice-of-law agreement…” and held that “[t]he limitation period applicable … is governed by New York’s borrowing statute, CPLR 202….” Id. Indeed all lower court opinions interpreting the type of “enforcement” language used in the contract at issue in this case are in accord with Luckie, and require application of CPLR 202. When confronted by the trial court on this point, Plaintiff-Appellant conceded the issue: THE COURT: I haven’t seen in my own research when you look at the word “enforcement” that the New York courts says apply New York law and you use the word “enforcement” that you don’t use CPLR 202. … THE COURT: Do you have a case? MR. BUCHDAHL: I do not. I do not. 13 THE COURT: You have a case? MR. BUCHDAHL: I do not. THE COURT: I couldn’t find one. MR. BUCHDAHL: I don’t believe there’s such a case. [R-30-31.] There should thus be no confusion that, when the parties choose to have their contracts “enforced” in accordance with New York law, that such law includes CPLR 202. 2. CPLR 202 applies in contracts where New York’s procedural rules are selected through a choice-of- forum provision. Parties can also contract for New York’s procedural rules through a choice-of-forum provision. See, e.g., Lerner v Prince, 119 AD3d 122, 127 [1st Dept 2014] (“matters of procedure are governed by the law of the forum”). In such circumstances, the Court of Appeals has also held that CPLR 202 must be applied. In Insurance Co. of N. America v ABB Power Generation, Inc., the parties included a New York choice-of-forum clause in a contract for a multi-million-dollar power plant. See 91 NY2d at 182. In considering applicability of the borrowing statute, the Court of Appeals made clear that 14 CPLR 202 was “part of this State’s procedural code,” and must be applied when the parties had contracted to be venued in New York: [W]e conclude that CPLR 202 requires that a court, when presented with a cause of action accruing outside New York, should apply the limitation period of the foreign jurisdiction if it bars the claim. Only where the cause of action accrues in favor of a New York resident is this rule rendered inapplicable. It matters not that jurisdiction is unobtainable over a defendant in the foreign jurisdiction or that the parties have contracted to be venued in this State. There is no inconsistency in applying the statute in either of these circumstances, and the purposes of the borrowing statute are in no way undermined by the application of the rule to such cases. 91 NY2d at 187-88 (emphasis added); see also Global Fin. Corp. v Triarc Corp., 93 NY2d 525, 530 [1999] (reiterating that “a forum- selection clause … would not override CPLR 202”). Lower courts that have addressed this issue have given short shrift to arguments, like Plaintiff-Appellant’s, that the selection of a New York forum should negate application of CPLR 202. See, e.g., All Children’s Hosp., Inc. v Citigroup Global Mkts., Inc., Index No. 162155/2014, 2016 NY Misc LEXIS 3122, at *6 [Sup Ct, NY County, 2016], aff’d 2017 NY App Div LEXIS 4961 [1st Dept June 20, 2017]. There, a Florida-based hospital sued Citigroup for alleged fraud relating to a bond offering. Id. at *3. Because the contract at issue 15 had a mandatory New York forum selection clause, Plaintiff argued that the parties had “no choice but to commence this action in New York” and that as such “CPLR 202’s public policy of preventing forum shopping is not an issue in this case.” Id. at *5-6. The court rejected this argument, explaining that “regardless of the fact that New York is the contractually selected forum … CPLR 202 applies, and therefore, Florida’s shorter limitations period applies as well.” Id. at *6-7. Thus, whether New York procedural rules are invoked by the parties in their contract through “enforcement” language, or through a choice-of-forum provision, the New York courts, including this Court, have made abundantly clear that CPLR 202 is a part of those rules. B. Ministers & Missionaries Benefit Board v Snow does not overrule Court of Appeals precedent. The two cases cited by Plaintiff-Appellant, IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A., 20 NY3d 310 [2012] and Ministers & Missionaries Benefit Bd. v Snow, 26 NY3d 466 [2015] (“MMBB”), should not be read to overrule this Court’s clear precedent. As the First Department recognized, “[n]either of those cases stands for the legal proposition, or even suggests, that a New York court should disregard the borrowing statute where there is 16 a broad contractual choice-of-law provision in the parties’ agreement.” [R- 494.] Those cases instead stand simply for the proposition that when parties have designated New York’s substantive law to govern their contractual rights and duties, New York courts should not engage in a further choice of law analysis to determine which state’s substantive laws should apply. Here, however, the parties chose to be governed by New York’s procedural rules, which rules are codified in the New York Civil Practice Law and Rules, and specifically include CPLR 202. See, e.g., CPLR 101 (“The civil practice law and rules shall govern the procedure in civil proceedings in all courts of the state and before all judges ….”); see also CPLR 201 (“An action … must be commenced within the time specified in this article [which article includes CPLR 202]….”). This Court has further recognized that CPLR 202 is an integral part of this state’s statutes of limitations, rather than a separate choice of law provision. As Plaintiff-Appellant concedes, CPLR 202 was enacted because of dissatisfaction with the rigid application of choice of law rules, not as a codification thereof. [Pl. Brief at 23-24] (citing Martin v Julius Dierk Equipment Co., 43 NY2d 583, 588 [1978] and Duval v Skouras, 44 NYS2d 17 107, 110 [Sup Ct, NY County 1943]). Indeed, in referring to the borrowing statute, this Court has made clear that “there is a significant difference between a choice-of-law question … and this Statute of Limitations issue, which is governed by the particular terms of the CPLR.” Global Fin. Corp. v Triarc Corp., 93 NY2d at 528. It is thus useful in this regard to compare MMBB at 473: EPTL 3-5.1(b)(2) … is merely a codification of a long-standing common-law conflict-of-laws principle, eventually placed within the EPTL because it corresponds to that general area of law. with 1 Weinstein, Korn & Miller, New York Civil Practice: CPLR ¶ 202.01 [2d ed 2016]: The result achieved by application of CPLR 202 varies in a number of ways from the result that would be achieved if statutes of limitations were subject to the choice-of-law rules generally applied by New York courts.2 2 It is telling that, while Plaintiff-Appellant points to a handful of federal and out-of-state cases to argue that a borrowing statute is a “choice-of-law provision” that this Court should now read out of the CPLR, Plaintiff- Appellant does not identify a single decision by a New York State court contrary to this Court and the Legislature’s direction that CPLR 202 must be considered part of New York’s statutes of limitations, or to the unbroken line of decisions holding that CPLR 202 is a part of New York’s procedural law, to be applied when parties designate that law in their contracts. Moreover, in federal, out-of-state cases that actually address this issue squarely, rather than in the passing dicta of Plaintiff-Appellant’s cases, the courts have applied New York law to determine that “CPLR 202 is not itself 18 Further distinguishing the IRB-Brasil and MMBB decisions is the disparate treatment of substantive and procedural law issues provided for in the Restatement (Second) of Conflicts of Laws. The Restatement provision referred to in IRB-Brasil and MMBB—and relied upon heavily by Plaintiff- Appellant here—provides for the application of “local law” in the absence of a contrary intention of the parties only in the context of substantive law principles, not procedural ones. See Restatement [Second] of Conflicts of Laws Section 187(3) [1971]. Where the Restatement specifically addresses procedural law issues, such as statute of limitations issues, it does not say that “local law” must a choice-of-laws principle.” See Lehman Bros. Holdings Inc. v Universal Am. Mortg. Co., LLC, No. 13-cv-00090, 2014 US Dist LEXIS 92431, at *25 (D. Colo. July 8, 2014). That court went on to reject exactly the argument Plaintiff-Appellant makes here. Id. at *27-28 (“Plaintiff argues that CPLR 202 is inapplicable because the parties contracted for the application of New York’s remedial law, including its six-year statute of limitations.… However, CPLR 202 is part of New York’s remedial law, not external to it.”). A different judge in a sister case similarly concluded that “New York courts have confirmed clearly that the borrowing statute is a statute of limitation, not a choice-of-law provision. The statute is located within the article of New York’s Civil Practice Law and Rules addressing ‘Limitations of Time.’ Moreover, and despite the loose language employed by some courts, section 202 regularly is characterized by New York courts as an exception to normal choice-of-law rules.” Lehman Bros. Holdings Inc. v Universal Am Mortg. Co., LLC, 12 F Supp 3d 1355, 1360 (D. Col. 2014) (internal citations omitted and emphasis in original). 19 apply to the exclusion of a State’s borrowing statute. Instead, the Restatement explicitly defines a forum’s statute of limitations to include its borrowing statute. See Restatement [Second] of Conflicts of Laws Section 142(1) (“An action will not be maintained if it is barred by the statute of limitations of the forum, including a provision borrowing the statute of limitations of another state.”) (emphasis added).3 This Court does not depart lightly from its own precedents, particularly those involving contractual rights or statutory interpretation, both at issue here. See, e.g., Great N. Ins. v Interior Constr. Corp., 7 NY3d 412, 419-20 [2006]. This Court also does not generally overrule controlling precedent sub silencio. See Georgia Malone & Co. v Rieder, 86 AD3d 406, 410 [1st Dept 2011] (declining to find that the Court of Appeals would have 3 Plaintiff-Apellant’s reference to the legislative history of Gen. Bus. Oblg. L. §5-1401 is equally inapposite. The Executive Director of the Law Revision Commission there made clear that the purpose of the bill was to allow parties to choose the law of New York to “govern construction of the contract,” not, as Plaintiff-Appellant would have, to govern the construction of the forum’s procedures or statutes of limitations. See, e.g., Memorandum By the Executive Director of the Law Review Commission relating to Assembly Bill No. 7307-A, Bill Jacket, L 1984, ch 421 at 17-18 (“Present law generally recognizes the ability of parties to stipulate in their contracts that the law of a particular state will govern construction of the contract. Nevertheless, the parties’ ability to choose governing law is not unlimited and will not be given effect unless there is a reasonable relationship to New York. This rule is universally followed. This bill would create a major exception to this rule.”) (emphasis added). 20 overruled controlling precedent without a clear indication that it was doing so). There is thus no reason to read either IRB-Brasil or MMBB to have overruled the unbroken line of cases holding CPLR 202 to be an integral component of New York’s procedural law. C. Plaintiff-Appellant’s “disparate treatment” argument does not justify departure from Court of Appeals precedent. As an equitable justification for a position unsupported by law, Plaintiff-Appellant makes much of the “disparate treatment” that would arise from this Court’s adherence to established precedent. But this is disingenuous: CPLR 202 is designed to treat plaintiffs from different jurisdictions differently. See CPLR 202; see also Ledwith v Sears Roebuck & Co., 231 AD2d 17, 22 [1st Dept 1997] (gas lantern exploded and injured both plaintiffs; New York plaintiff’s claims were timely, Oregon plaintiff’s claims were not); Ackerman v Price Waterhouse, 252 AD2d 179, 195-96 [1st Dept 1998] (class certification properly denied because CPLR 202 requires the court to apply different statutes of limitations for different plaintiffs). Indeed, in interpreting standard client brokerage agreements that could result in the application of different limitation periods for thousands of investors, New York courts have repeatedly held that CPLR 202 is part of 21 New York’s procedural law when the parties called for “enforcement” of their contracts under New York law. See, e.g., Luckie, 85 NY2d at 207-08; Luckie, 245 AD2d at 18, 665 NYS2d at 75; Matter of Painewebber, Inc. (Rochester), NYLJ, Oct. 7, 1993, at 2, col 6 [Sup Ct, NY County, Schoenfeld, J.]. Plaintiff-Appellant’s spurious appeal to equity should therefore be rejected. D. There is no indication the parties attempted to exclude CPLR 202 from New York’s procedural rules or their contract. Although Plaintiff-Appellant frequently invokes the “parties’ expectations,” it is Plaintiff-Appellant’s unique reading of New York’s procedural rules to exclude CPLR 202 (based on its interpretation of a case decided after the NDA was executed, no less), that would upset such expectations. This Court and the Appellate Division have made clear to litigants that CPLR 202 is “part of this State’s procedural code” and must be considered where the parties agreed to a New York venue, or where their contract would be “enforced” pursuant to New York law. See, e.g., Ins. Co. of N. Am., 91 NY2d at 187; Luckie, 85 NY2d at 207-08; Luckie, 245 AD2d at 18, 665 NYS2d at 75. Because it is “presume[d] that parties govern their conduct by reference to existing law,” the only reasonable conclusion is that 22 use of the word “enforced” was intended to incorporate all of New York’s procedural law, including CPLR 202. See, e.g., Seymour v Victor Balata Belting Co., 174 Misc 2d 677, 679 [Sup Ct, Monroe County 1997]. Nor is there any indication in the contract itself that the parties intended to carve out CPLR 202. Despite Plaintiff-Appellant’s repeated insinuations to the contrary, there is not a single reference to the statute of limitations in the clause at issue, much less an agreement to include a specific six-year statute of limitations or to exclude New York’s borrowing statute. Plaintiff-Appellant instead relies entirely on the word “enforced” in the clause. As discussed above, per Court of Appeals and all other precedent existing at the time, this language unambiguously included CPLR 202. Yet to the extent this language leaves any lack of clarity about the parties’ intent, that ambiguity must be construed against Plaintiff-Appellant as the drafter of the contract (or, more precisely, as the drafter’s purported assignee, see Pl. Brief at 9). See, e.g., 151 W. Assocs. v. Pinstripes Fabric Corp., 61 NY2d 732, 734 [1984] (“It has long been the rule that ambiguities in a contractual instrument will be resolved contra proferentem, against the party who prepared or presented it.”). 23 E. Even had the parties attempted to exclude CPLR 202 from New York’s procedural rules or their contract, it would have no impact in this matter. Yet even had the parties expressly chose New York’s six-year statute of limitations, it would not have affected the result here. CPLR 201 provides that an action must be commenced “within the time specified in this article” (which article includes CPLR 202), “unless … a shorter time is prescribed by written agreement.” See CPLR 201 (emphasis added). Indeed, the Legislature was explicit in its admonition that “No court shall extend the time limited by law for the commencement of an action.” See id. General Obligations Law Section 17-103(3), similarly makes clear that parties, prior to the accrual of a cause of action, cannot extend the limitations periods dictated by the CPLR in their contracts, despite Plaintiff- Appellant’s contention that this was exactly what occurred here. See McKinney’s Cons Laws of NY, Book 23A, General Obligations Law § 17- 103(3) [2010]; see also John J. Kassner & Co. v City of New York, 46 NY2d 544, 551 [1979]. There is no dispute that, in the absence of a contractual provision to the contrary, New York courts would have subjected Plaintiff-Appellant’s claims to Ontario’s shorter two-year statute of limitations. That being the 24 case, no contractual provision could have extended that limitations period prior to the accrual of the cause of action. Thus, even if Plaintiff-Appellant were correct that the parties intended to apply a six-year statute of limitations in lieu of Ontario’s two-year statute of limitations, the parties were simply without the power to do so. Plaintiff-Appellants’ position would thus require this Court to overrule not one but two lines of its long-established precedent. This Court should decline Plaintiff-Appellant’s invitation to do so. V. Conclusion Despite Plaintiff-Appellant’s suggestions to the contrary, this is not a case where the parties expressly contracted for application of New York’s six-year statute of limitations. Like numerous other commercial entities that regularly include a New York choice of forum provision in their contracts, these parties chose to be governed by New York’s procedural rules. This Court, the New York State Legislature, and all other New York courts that have been faced with this issue, have made clear that CPLR 202 is a part of New York’s procedural rules, and must be applied when the parties have agreed to apply such rules. There is thus no conflict presented by MMBB or IRB-Brasil, which do not displace this rule or purport to alter this unbroken line of precedent, and the Appellate Division’s Order should be affirmed. Dated: New York, New York October 5, 2017 Respectfully submitted, BAKEEÿ MCKENZIE LLP‘IT, Gram A. Hanessian Ikcob M. Kaplan '452 Fifth Avenue New York, New York 10018 (212) 626-4100 Attorneys for Defendants- Respondents Samsung C&T Corp., Samsung America, Inc., and Samsung C&T America, Inc. (f/k/a Samsung America, Inc.) By: 25 NEW YORK STATE COURT OF APPEALS CERTIFICATE OF COMPLIANCE I hereby certify pursuant to 22 NYCRR § 500.l(j) that the foregoing brief was prepared on a computer using Microsoft Word. Type. A proportionally spaced typeface was used, as follows: Name of typeface: Times New Roman Point size: 14 Line spacing: Double Word Count. The total number of words in this brief, inclusive of point headings and footnotes and exclusive of pages containing the table of contents, table of citations, proof of service, certificate of compliance, corporate disclosure statement, questions presented, statement of related cases, or any authorized addendum containing statutes, rules, regulations, etc., is 5,039 words. Dated: New York, New York October 5, 2017 fflrant A. Hanessian 'Jacob M. Kaplan Baker & McKenzie LLP 452 Fifth Avenue New York, New York 10018 (212) 626-4100 26 27 Attorneys for Defendants- Respondents Samsung C&T Corp., Samsung America, Inc., and Samsung C&T America, Inc.(f/k/a Samsung America, Inc.)