Despite "no third-party beneficiaries" clause, non-party held to have standing in breach of contract action

Decision and Order denying motion to dismiss for lack of standing


Plaintiffs, who were not signatories to the contract of sale of a subsidiary of defendant, brought an action for breach of contract, breach of warranties and covenants and sought indemnification. Defendant moved to dismiss based on lack of standing, relying on plaintiffs' non-signatory status and on a "no third-party beneficiares" clause in the contract. The Appellate Division, First Department affirmed the denial of the motion to dismiss. The contract provided for indemnification and hold harmless of the buyers' affiliates, of which the plaintiffs were included.

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Reference Info:Decision | State, 2nd Circuit, New York | United States

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