Fraud Claim Against Syndicated Lender Allowed To Proceed, Despite Express Disclaimer Of Reliance In Deal Documents

On May 10, 2010, Justice Barbara R. Kapnick permitted a fraud claim to proceed against a syndicated lender despite the fact that the plaintiffs were sophisticated parties and the loan documents contained express disclaimers of reliance. See Harbinger Capital Partners Master Fund I Ltd. v. Wachovia Capital Markets LLC, Index No. 602529/08 (Sup Ct, NY County, May 10, 2010) ("Harbinger"). The court held that it was too early in the litigation to determine whether "the true nature of the situation" might place plaintiffs within an exception to the bar on fraud claims that generally occurs where deal documents contain express contractual disclaimers.

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