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Note: The New York Supreme Court, New York County, denied Cargill Financial Services International's application for an attachment of funds in the New York correspondent accounts of Bank Finance & Credit Ltd., a Ukrainian bank, and held vacated a temporary restraining order preventing movement of the funds. On appeal, the Supreme Court of New York, Appellate Division, First Department, Mazzarelli, Andrias, Moskowitz, Renwick, and Richter, JJ., affirmed in a per curiam opinion. The appellate opinion stated:

"While plaintiff's evidence established a basis for quasi in rem jurisdiction, in that defendant, a Ukranian bank, utilized its New York correspondent accounts to receive funds and make interest payments pursuant to the terms of the parties' loan agreements and associated letters of credit (see generally Banco Ambrosiano v Artoc Bank & Trust, 62 NY2d 65, 464 N.E.2d 432, 476 N.Y.S.2d 64 [1984]), plaintiff failed in its burden to show the extent, if any, that defendant had an attachable ownership interest in the subject correspondent accounts (see e.g. Sigmoil Resources v Pan Ocean Oil Corp. (Nigeria), 234 AD2d 103, 650 N.Y.S.2d 726 [1996], lv dismissed 89 NY2d 1030, 680 N.E.2d 619, 658 N.Y.S.2d 245 [1997]). As such, the court properly exercised its discretion to deny plaintiff's attachment application (see J.V.W. Inv. Ltd. v Kelleher, 41 AD3d 233, 837 N.Y.S.2d 650 [2007])."

Comment:

The LC was a so-called Structured LC in which the issuer was also the applicant. [JEB/gdb]

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