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Anthracite Capital, Inc. v. Maguire Partners—555 West 5th Mezzanine, LLC
Citation: 165 F. App'x 875Docket: No. 05-3163-CV
Court: Court of Appeals for the Second Circuit; December 19, 2005; Federal Appellate Court
Anthracite appealed a final order from the U.S. District Court for the Southern District of New York, which granted summary judgment to the defendants on Anthracite’s breach of contract claims, denied Anthracite’s motion for summary judgment, and excluded expert testimony. The court's review of the summary judgment is de novo, assessing the absence of genuine issues of material fact. The case revolves around a Mezzanine Loan Agreement dated December 20, 2000, in which loan amounts were secured through membership interests in two entities, Partners 555 and Partners 808, that owned the Gas Company Tower and a parking garage. Anthracite purchased a securitized tranche of this loan and claimed that a change in ownership of the corporate entities constituted a “sale” triggering the defendants' obligation to pay a Supplemental Exit Fee. The Loan Agreement specifies that the fee is due only upon sales where the total value reaches at least $425 million. The district court ruled that no “sale” occurred as defined in the Loan Agreement, asserting that the term means “the transfer of property or title for money or other consideration.” Consequently, the court found that the defendants were not obligated to pay the Supplemental Exit Fee, a conclusion that was upheld by the appellate court. The “Supplemental Exit Fee Purchase Price” is defined as the gross purchase price for the Property, encompassing all forms of consideration payable to the Companies or Borrowers, including cash, non-cash proceeds, and financing that can be reasonably attributed to the Property. The consideration necessary for a sale must consist of the purchase price payable to MP-555, MP-808, Partners 555, or Partners 808. The district court determined that Anthracite failed to provide adequate evidence to dispute that the title transfer of the Tower and Garage occurred without any payment or consideration as required by Section 2.6(k). In contrast, defendants presented undisputed evidence confirming this lack of payment. Anthracite argued that a change in ownership of the corporate entities owning the Property constituted a sale triggering the Supplemental Exit Fee. However, the district court clarified that the Loan Agreement specifies the fee is due upon the sale of the Property itself, not merely the sale of interests in it. Consequently, as the defendants were not liable for the Supplemental Exit Fee, Anthracite's other claims were deemed meritless. The district court also dismissed Anthracite's motion to exclude expert testimony as moot. The judgment of the district court is affirmed.