Chen Dongwu v New York City Regional Ctr. LLC

Holding The court granted summary judgment dismissing all remaining claims, holding that plaintiffs failed to establish justifiable reliance or injury for fraud because they received green cards and signed agreements acknowledging receipt of offering materials. Additionally, the court found that the manager’s decisions regarding fee payments and collateral sales were protected by the business judgment rule as they were made in good faith and conflicts of interest were disclosed.

The court’s words

That plaintiffs did not have the offering materials before them prior to signing and agreeing to invest, without having read the material or having asked to see them prior to signing, does not constitute justifiable reliance

2026 NY Slip Op 51697[U], at the official text

A breach of fiduciary duty claim may not be based on a conflict of interest or even self-dealing where the conflict was specifically disclosed in the partnership agreement or prospectus

2026 NY Slip Op 51697[U], at the official text

The mere fact that a fiduciary could, or does, financially benefit from a particular business decision does not, standing alone, create a disqualifying conflict of interest sufficient to strip that decision of business judgment protection

2026 NY Slip Op 51697[U], at the official text