part of the issue with 'reliance' etc is the fact that it is so intertwined with everyone's thoughts regarding fraud. The Domino's Pizza case (cited by Engeron) probably says it best. After saying 'reliance' and 'scienter' and 'materiality' are not 'elements,' the court said: "That said, evidence regarding falsity, materiality, reliance and causation plainly is relevant to determining whether the Attorney General has established that the challenged conduct has the capacity or tendency to deceive, or creates an atmosphere conducive to fraud.****In determining whether certain conduct was deceptive, surely it is relevant whether members of the target audience - several of whom were called as witnesses at trial by the Attorney General - were actually deceived. Similarly, if the evidence showed that the alleged false statements had no real-world impact (that is, no reliance or causation), that would speak to the question of whether the challenged conduct was unlawfully deceptive or fraudulent. Indeed, the Attorney General in her Verified Petition herself emphasized both reliance and causation in describing her claim under Executive Law 63[12]"
You can look throughout the entire complaint AND ruling and see that 'reliance' is clearly almost 'relevant' enough that it practically becomes an 'element,' even when it is not a 'required element.' Indeed, the entire premise of the damages hinges on a reliance aspect.
as to 'intent' or 'knowingly' using false statements, etc. - Engeron says it is not required. Summary judgment opinion: "good faith or lack of fraudulent intent is not in issue.** (holding liability under Executive Law 63( 12) does not require demonstrating an intent to defraud. Ruling: "plaintiff need only prove that defendants used false statements in business."
Engeron also claims that 'value' is objective, meaning there is one and only one 'value.'
According to the ruling, the banks always essentially ignore the SFCs and take a huge haircut: "Williams corroborated the testimony of Nicholas Haigh that Deutsche Bank would apply a standard 50% haircut to the values of assets supplied by a client on an SFC, testifying that "it is it is after we have made what I would say are generally our standard adjustments that we apply to really any given high-net-worth individual or ultra-high-net-worth individual's provided financial statements." THe banks also testified they valued property considering 'bad market conditions.'
so the STANDARD in almost every transaction is for at least one of the two parties to be using 'false statements,' which according to Engeron is the only standard at all - no 'intent,' no 'reliance,' no 'knowledge of falsity,' If market value is OBJECTIVE, then one of the two parties used a false statement. And since Engeron wanted to talk about 'real world versus fantasy,' then the same would apply when banks 'apply bad market conditions during good market conditions' to get FMV. Maybe the banks are using low values to require higher interest rates? But if Engeron is to be believed in his ruling that "New York means business in combating business fraud," then, yes, every similar transaction should be subject to the same law. It matters not whether any of the parties 'intended' or 'knowingly' used false statements.
There is so much wrong with his rulings - the appellate court may be just as corrupt/biased as Engeron, but even it may find this too far. It certainly should. The beginning of is bad rulings is the fact that he should have never been making them in the first place. He was so clearly biased that it destroyed any semblance of what justice is intended to be. Every ruling flowed from that bias, and was tainted by it, including admission/exclusion of experts/testimony/evidence and interpretations of law.
