of corporate takeover bids from the information within the documents
and, without disclosing his knowledge, purchased stock in the target
companies. Id. He sold the shares immediately after the takeover attempts
were made public. Id. The petitioner was indicted and convicted on 17
counts for violations of § 10(b) and Rule 10b-5, and the judgment was
affirmed. Id. at 225, 100 S.Ct. 1108. The Court reversed, holding that
"[w]hen an allegation of fraud is based upon nondisclossure, there can be
no fraud absent a duty to speak." Id. at 235, 100 S.Ct. 1108. The Court
further held that "a duty to disclose under § 10(b) does not arise
from the mere possession of nonpublic market information." Id. A duty to
disclose arises when one party has information "that the other [party] is
entitled to know because of a fiduciary or other similar relation of
trust and confidence between them." Id. at 228, 100 S.Ct. 1108.
In O'Hagan, the United States Supreme Court held that a person who
trades in securities for personal profit, using confidential information
misappropriated in breach of a fiduciary duty to the source of the
information, may be held liable for violating § 10(b) and Rule
10b-5. O'Hagan, 521 U.S. 642, 652, 117 S.Ct. 2199, 138 L.Ed.2d 724.
Initially, the Court notes that O'Hagan is dissimilar from the present
case because (1) O'Hagan is a criminal case, and (2) James O'Hagan was
not trading debt securities, but purchasing call options for common
stock. Id. at 647, 648, 117 S.Ct. 2199. The facts underlying the Court's
decision demonstrate that while Mr. O'Hagan was not a corporate insider
in a traditional sense, he violated § 10(b) and Rule 10b-5 by
misappropriating confidential information for securities trading purposes
in breach of a duty. O'Hagan, 521 U.S. at 659, 117 S.Ct. 2199 (emphasis
added). Mr. O'Hagan was a partner in the law firm of Dorsey & Whitney in
Minneapolis, Minnesota. Id. at 647, 117 S.Ct. 2199. In July 1988, a
company based in London, Grand Metropolitan PLC ("Grand Met"), retained
Dorsey & Whitney as local counsel to represent Grand Met regarding a
potential tender offer for the common stock of the Pillsbury Company. Id.
Both Grand Met and Dorsey & Whitney sought to protect the confidentiality
of Grand Met's tender offer plans. Id. Mr. O'Hagan did not work on the
Grand Met representation. Id. Dorsey & Whitney withdrew from representing
Grand Met on September 8, 1988, and on October 4, 1988, Grand Met
publicly announced its tender offer for Pillsbury stock. Id. However, on
August 18, 1988, O'Hagan began purchasing call options for Pillsbury
stock and some 5,000 shares of Pillsbury common stock. Id. When Grand Met
announced its tender offer in October, Mr. O'Hagan sold his options and
common stock, profiting approximately $4.3 million. Id. At trial, Mr.
O'Hagan was convicted on all 57 counts against him, but the Eighth
Circuit Court of Appeals reversed the convictions holding that liability
under § 10(b) and Rule 10b-5 is inconsistent with the
misappropriation theory. Id. at 649, 666, 117 S.Ct. 2199.
In reversing the Eight Circuit's decision, the Supreme Court explained
both the "traditional" or "classical theory" of insider trading liability
and the "misappropriation theory," raised by Plaintiffs here. Under the
traditional theory, "§ 10(b) and Rule 10b-5 are violated when a
corporate insider trades in the securities of his corporation on the
basis of material, nonpublic information." O'Hagan, 521 U.S. at 651-52,
117 S.Ct. 2199. Trading on such information qualifies as a "deceptive
device" under § 10(b) because "a relationship of trust and confidence
[exists] between the shareholders of a corporation and those insiders who
have obtained confidential information by reason of their position with
the corporation." Id. at 652, 117 S.Ct. 2199 (quoting Chiarella, 445
U.S. at 228, 100 S.Ct. 1108) (internal quotes omitted). The Court has
recognized that the relationship between shareholders and insiders "gives
rise to a duty to disclose [or to abstain from trading] because of the
of preventing a corporate insider from . . . taking unfair advantage of
. . . uninformed stockholders." Id. (quoting Chiarella, 445 U.S. at
228-29, 100 S.Ct. 1108) (internal quotes omitted).
In the present case, the Court declines to extend the Court's decision
in O'Hagan to a civil case involving a transaction for high yield debt
securities. Case law clearly establishes that a corporation does not have
a fiduciary relationship with its debt security holders, as with its
shareholders. See Lorenz, supra. Accordingly, the Court finds that
Jackson does not owe a duty to Plaintiffs in connection with the Sale.
Plaintiffs further argue that Jackson violated § 10(b) because,
under the misappropriation theory, an insider that misappropriates
information from its principal and trades on it for its own benefit,
violates § 10(b) regardless of whether the insider has any fiduciary
duty to the person to whom it trades. (See Pl.Br. in Opp'n to Jackson
Br. at 12.) The misappropriation theory holds that "a person commits
fraud in connection with a securities transaction, and thereby violates
§ 10(b) and Rule 10b-5, when he misappropriates confidential
information for securities trading purposes, in breach of a duty owed to
the source of the information." O'Hagan, 521 U.S. at 652 (emphasis
added). The Court further explained that:
The two theories are complimentary, each addressing
efforts to capitalize on nonpublic information through
the purchase or sale of securities. The classical
theory targets a corporate insider's breach of a duty
to shareholders with whom the insider transacts; the
misappropriation theory outlaws trading on the basis
of nonpublic information by a corporate "outsider" in
breach of a duty owed not to a trading party, but to
the source of the information. The misappropriation
theory is thus designed to protect the integrity of
the securities markets against abuses by "outsiders"
to a corporation who have access to confidential
information that will affect the corporation's
security price when revealed, but who owe no fiduciary
or other duty to that corporation's shareholders.
O'Hagan, 521 U.S. at 652-53, 117 S.Ct. 2199 (quotations omitted).
Plaintiffs' argument misconstrues the O'Hagan decision. Plaintiffs
suggest that, in purchasing the Debt Securities, Jackson violated §
10(b) and Rule 10b-5, even though Jackson did not owe a fiduciary duty to
the South Street Funds. The O'Hagan Court established that a person
commits fraud in connection with a securities transaction, in violation
of § 10(b) and Rule 10b-5, "when he misappropriates confidential
information for securities trading purposes, in breach of a duty owed to
the source of the information." 521 U.S. at 652, 117 S.Ct. 2199 (emphasis
added). Mr. O'Hagan was an "outsider" of Grand Met, but through his
affiliation with Dorsey & Whitney, which represented Grand Met, he
obtained inside information. Thus, Mr. O'Hagan owed a duty to the sources
of information—his law firm Dorsey & Whitney and its client, Grand
Met. In contrast, Jackson did not owe a fiduciary duty to Plaintiffs.
Jackson's source of information regarding the value of Bucyrus and the
Debt Securities was Bucyrus itself. Jackson's conduct could not
constitute a breach of a duty to Bucyrus because Bucyrus was aware of the
information that Jackson did not disclose to the South Street Funds. See
O'Hagan, 521 U.S. at 655, 117 S.Ct. 2199 ("the deception essential to the
misappropriation theory involves feigning fidelity to the source of
information. . . ."). Therefore, the Court finds that Jackson's conduct
did not violate § 10(b) and Rule 10b-5.
Simply put, Jackson did not violate § 10(b) and Rule 10b-5 because
the Sale involved debt securities, and a corporation does not owe a duty
with respect to debt securities. Alternatively, Jackson did not owe a
duty to Plaintiffs under the misappropriation
theory because Plaintiffs were not the source of the information
regarding Bucyrus and there was no fiduciary relationship.
2. Common Law Fraud Claim
Jackson argues that Plaintiffs' claim for common law fraud should be
dismissed because Plaintiffs failed to allege any facts showing that
Jackson had a duty to disclose material facts to Plaintiffs. Where a
claim for fraud is based on silence or concealment, "New Jersey courts
will not imply a duty to disclose, . . . ." Lightning Lube, Inc. v. Witco
Corp., 4 F.3d 1153, 1185 (3d Cir. 1993). The question of whether a duty
to disclose exists, constituting a fraudulent concealment, is a matter of
law. See United Jersey Bank v. Kensey, 306 N.J. Super. 540, 551,
704 A.2d 38 (1997). Three categories of relationships give rise to a duty
(1) fiduciary relationships, such as principal and
agent, client and attorney, or beneficiary and
trustee; (2) relationships where one party expressly
reposits trust in another party, or else from the
circumstances, such necessarily is implied; and (3)
relationships involving transactions so intrinsically
fiduciary that a degree of trust and confidence is
required to protect the parties.
Lightning Lube, 4 F.3d at 1185; see also Kensey, 306 N.J.Super. at 551,
704 A.2d 38.
Plaintiffs' relationship with Jackson does not fall into any of these
categories. The Sale was an arms length transaction between parties
experienced in the volatile debt securities market. The Court finds that
Plaintiffs have failed to plead facts that would establish Jackson's
"duty to speak," i.e.; Jackson's duty to disclose information concerning
Bucyrus to Plaintiffs prior to the Sale. Accordingly, Plaintiffs common
law claims of fraud will be dismissed.
Jackson argues, alternatively, that should the Court grant Jackson's
motion to dismiss the insider trading claims, Plaintiffs state common law
fraud claims should be dismissed pursuant to FED.R.Civ.P. 12(b)(1) for
lack of subject matter jurisdiction. In view of the Court's ruling
regarding "duty to speak," this argument need not be addressed.
3. Adequacy as a Representative in a Derivative Action
Alternatively, Jackson argues that Mr. Salovaara cannot adequately and
fairly represent the Plaintiffs derivatively for five reasons and the
complaint must be dismissed. First, Mr. Salovaara currently seeks
indemnification from the South Street Funds for at least seven actions in
which he is engaged. (Jackson Br. at 17.) Second, Mr. Salovaara is
engaged, both as a plaintiff and as a defendant, in actions involving the
very entities that he purports to represent here derivatively. (Id.)
Third, Mr. Salovaara has testified in a related action that he personally
had knowledge, at the time of the Sale, of much of the information that
Jackson failed to disclose. (Id.) Fourth, Mr. Salovaara "engineered a
sham transaction in order to manufacture evidence in support of his
claims in this action and in [the Hindes action]." (Id.) Fifth, there are
unique defenses that can be asserted against Mr. Salovaara individually.
(Id. at 18.)
Federal Rule of Civil Procedure 23.1 provides that: "[t]he derivative
action may not be maintained if it appears that the plaintiff does not
fairly and adequately represent the interests of the shareholders or
members similarly situated in enforcing the right of the corporation or
association." In Vanderbilt v. Geo—Energy Ltd., 725 F.2d 204, 207,
the Third Circuit Court of Appeals has held that, in order to adequately
represent a class as a derivative counsel, the plaintiff must have
competent counsel and the plaintiff must not have interests antagonistic
to those of the class. Here, it is undisputed that Mr. Salovaara is
represented by competent counsel.
Thus, the Court's inquiry focuses on whether Mr. Salovaara's interests
are antagonistic to the South Street Funds's interests.
Jackson cites twelve actions in seven venues, involving the South
Street Funds, in which Mr. Salovaara is a party. All of the litigation
stems from either Mr. Salovaara and South Street Funds's involvement
related to Bucyrus' chapter 11 bankruptcy case or the "winding down" of
the South Street Funds. (Jackson Br. at 6.) As noted supra at 596, Mr.
Salovaara commenced the Hindes action, Civil Action No. 96-3203 (AKH), in
the Southern District of New York. The Hindeses and Mr. Eckert were
partial officers of the SSP LPs and controlled the South Street Funds.
(See supra at 596.) Mr. Salovaara brought the following actions against
Mr. Eckert, and other nominal defendants relating to disputes regarding
the South Street Funds:
(1) Salovaara v. Eckert, MRS-C-29-94 (N.J.Super.Ct.,
Morris Cty.) (See Starkey Aff.Ex. 4.)
(2) Salovaara v. Eckert, MRS-C-126-96 (N.J.Super.Ct.,
Morris Cty.) (See Starkey Aff.Ex. 5.)
(3) Salovaara v. Eckert et al., 94— 3430 (KMW)
(S.D.N.Y.) (See Starkey Aff.Ex. 6.)
(4) Salovaara v. Eckert, et al., MRS-L-539-99
(N.J.Super.Ct., Morris Cty.) (See Starkey Aff.Ex.
Mr. Salovaara also commenced actions against third parties seeking
damages on behalf of himself and the South Street Funds including an
action in New York state Court against Milbank, Tweed, Hadley & McCloy, a
law firm from New York, New York and third-party complaints against
Milbank, Tweed, Hadley & McCloy in the Eastern District of Wisconsin.
(See Jackson Br. at 7.) In addition, on or about August 10, 1998, the
South Street Funds commenced an action against Mr. Salovaara in Delaware
Chancery Court, South Street Corporate Recovery Fund I, L.P., et al. v.
Salovaara, C.A. No. 16579, 1999 WL 504778 (Del.Ch. July 9, 1999), seeking
a declaratory judgment that Mr. Salovaara is not entitled to
indemnification for certain costs and fees related to litigation. (See
Jackson Br. at 7; Starkey Aff.Ex. 8.) Mr. Salovaara has compiled legal
fees and expenses in excess of $2.1 million. (See Jackson Br. at 8.)
Mr. Salovaara has initiated separate lawsuits against the controlling
officers of the South Street Funds, Mr. Eckert and the Hindeses, and the
South Street Funds themselves, and all of the litigation stems, directly
or indirectly, from the Bucyrus bankruptcy or the Sale of the Debt
Securities. Moreover, the South Street Funds have initiated a lawsuit
against Mr. Salovaara. As a result, the Court finds that Mr. Salovaara's
interests are antagonistic to Mr. Eckert, the Hindeses, and to the South
Street Funds collectively—the very parties he seeks to represent.
Because of the antagonistic interests between Mr. Salovaara and the
derivative Plaintiffs, the Court finds, on alternative grounds, that this
derivative action may not be maintained and must be dismissed.
C. Lazard's Motion to Dismiss
1. Motion to Dismiss under a Forum Selection Clause
The next question before the Court is whether the South Street Funds
are contractually obligated under the Indemnification Agreement to
resolve any disputes with Lazard involving the Sale in either the United
States District Court for the Southern District of New York or the state
courts of New York City and County. Lazard moves to dismiss pursuant to
FED. R.Civ.P. 12(b)(6), arguing that it is the proper basis for motions
to dismiss based upon forum selection clauses under Third Circuit
jurisprudence. (Lazard Br. at 6 (citing National Micrographics Sys. v.
Canon U.S.A., Inc., 825 F. Supp. 671, 679 (D.N.J. 1993))).
Section 1404(a) of 28 U.S.C. states: "For the convenience of the
parties and witnesses, in the interest of justice, a district court may
transfer any civil action to any other district or division where it
might have been brought." Section 1406(a) states in pertinent part: "The
district court of a district in which is filed a case laying venue in the
wrong division or district shall dismiss, or if it be in the interest of
justice, transfer such case to any district or division in which it could
have been brought."
"When a forum selection clause requires an action to be brought in
state or federal courts of a particular state, and the action is pending
in federal court . . ., the courts differ as to what is the proper motion
to enforce the clause." 17 Moore's Federal Practice, §
111.04[a][i] (Matthew Bender 3d ed.) (emphasis in original) (Supreme
Court seemed to endorse the use of § 1404(a), see Stewart Org., Inc.
v. Ricoh Corp., 487 U.S. 22, 108 S.Ct. 2239, 101 L.Ed.2d 22 (1988);
however, three years later the Court cast doubt on whether § 1404(a)
is the proper motion, see Carnival Cruise Lines v. Shute, 499 U.S. 585,
111 S.Ct. 1522, 113 L.Ed.2d 622 (1991)).
The Third Circuit Court of Appeals addressed a similar issue in Jumara
v. State Farm Ins. Co., 55 F.3d 873, 877-79 (3d Cir. 1995). Jumara
involved an underinsured motorist case that was filed in the Eastern
District of Pennsylvania. Jumara, 55 F.3d at 875. The plaintiffs sought
an order appointing arbitrators and compelling arbitration by their
carrier, the defendant. The plaintiffs' insurance contracts, which
incorporated the Pennsylvania Uniform Arbitration Act, contemplated
arbitration related-proceedings in either the Court of Common Pleas of
Luzerne County, Pennsylvania or the Middle District of Pennsylvania. Id.
The district court denied the plaintiffs' motion to compel arbitration,
reasoning that the insurance contracts, in light of the Pennsylvania law
that they incorporated, contained a forum selection clause relegating the
plaintiffs' suit to the Court of Common Pleas of Luzerne County. Id. In
effect, the district court disposed of the case under § 1406(a) for
improper venue. Id. The Third Circuit Court of Appeals held that because
venue was proper in the Eastern District of Pennsylvania, "[t]he district
court should instead have invoked 28 U.S.C. § 1404(a), which involves
a multi-factor balancing test in which a contractual forum selection
clause carries substantial although not dispositive weight." Id.
The District of New Jersey followed Jumara in Reynolds Publishers,
Inc. v. Graphics Financial Group, Ltd., 938 F. Supp. 256, 260-61 (1996).
In Reynolds, the defendants requested dismissal on the ground that a
forum selection clause was valid and enforceable. Reynolds, 938 F. Supp.
at 260. Because the court had personal jurisdiction over the defendants,
it held that "the proper analysis involve[d] the § 1404(a) balancing
test." Id. at 261.
In the present case, it is uncontested that the Court has jurisdiction
in this District, where Mr. Salovaara resides and Plaintiffs and
Defendants transacted business related to the Sale. See 28 U.S.C.
1391(c). Because jurisdiction in this District is proper, this case
should not be disposed of pursuant to § 1406(a). Therefore, the Court
will consider Lazard's motion to dismiss according to the § 1404(a)
In ruling on § 1404(a) motions, courts consider a variety of
factors, beginning with those enumerated in § 1404(a): convenience of
the parties, convenience of witnesses, and the interests of justice.
Additionally, courts have considered "all relevant factors to determine
whether on balance the litigation would more conveniently proceed and the
interests of justice be better served by transfer to a different forum."
Jumara, 55 F.3d at 879 (quoting 15 C. WRIGHT, A. MILLER & E. COOPER
§ 3847). As stated by the Reynolds Court:
Those factors include private interests—
plaintiff s forum preference as manifested
in the original choice . . .; the defendant's
preference . . .; whether the claim arose elsewhere .
. .; the convenience of the parties as indicated by
their relative physical and financial condition . .
.; the convenience of the witnesses—but only to
the extent that witnesses may actually unavailable for
trial in one of the fora . . .; and the location of
books and records (similarly limited to the extent
that the files count not be produced in the
alternative forum). The factors also include public
interests—the enforceability of the judgment
practical considerations that could make the trial
easy, expeditious, or inexpensive . . .; the relative
administrative difficulty in the two fora resulting
from court congestion . . .; the local interests in
deciding local controversies at home . . .; the public
policies of the fora . . .; and the familiarity of the
trial judge with the applicable state law in diversity
Reynolds, 938 F. Supp. at 261 (citations and quotations omitted). Within
the framework set forth above, "the forum selection clause is treated as
a manifestation of the parties' preferences as to a convenient forum."
Jumara, 55 F.3d at 880. The court noted that "while courts normally defer
to a plaintiffs choice of forum, such deference is inappropriate where
the plaintiff has already freely contractually chosen an appropriate
forum." Id. Where a forum selection clause is valid, "which requires that
there was no `fraud, influence, or overweening bargaining power,' the
plaintiffs bear the burden of demonstrating why they should not be bound
by their contractual choice of forum." Jumara, 55 F.3d at 880 (citations
omitted) (citing Bremen v. Zapata Off—Shore Co., 407 U.S. 1,
12-13, 92 S.Ct. 1907, 32 L.Ed.2d 513 (1972)).
2. The Indemnification Agreement
Plaintiffs argue that the language of the Indemnification Agreement is
limited to disputes arising from indemnification claims. The first
sentence of the Indemnification Agreement provides: "In connection with
our role as your agent in the proposed sale of the Bucyrus—Erie
Co. Secured Notes, you and we are entering into this letter agreement."
(See Harasymiak Aff.Ex. A, the Indemnification Agreement) (emphasis
added). Based on the language referenced above, the Court is satisfied
that the present litigation is related to the Indemnification Agreement.
Such an interpretation of the agreement appears to be consistent with the
intention of the parties. The timing of events provides further evidence
that Lazard entered into the agreement to protect itself from this,
readily apparent, web of litigation. As Lazard was negotiating the terms
of the Sale with Jackson, Mr. Salovaara attempted to enjoin the
transaction. On February 28, 1996, approximately one week before the
settlement date of the March 4, 1996 Sale, Lazard and the South Street
Funds entered into the Indemnification Agreement.
Plaintiffs' argument—that the language of the Indemnification
Agreement is limited to disputes arising from indemnification
claims—ignores the language of the agreement. The agreement
specifically states: "It is understood and agreed that in the event that
[Lazard] or any of our members, employees, agents, affiliates or
controlling persons, if any [of such "Indemnified Persons"] become
involved in any capacity in any action, claim, proceeding or
investigation . . . related to, arising out of or in connection with
[Lazard's] services. . . . " (Id.) (emphasis added). The present
litigation is clearly related to Lazard's services in negotiating the
Sale of the Debt Securities to Jackson. Moreover, the Indemnification
Agreement provides that "[t]his agreement and any claim related directly
or indirectly to this agreement (including any claim concerning advice
provided pursuant to this agreement) shall be governed and construed in
accordance with the laws of the state of New York. . . . No such claim
shall be commenced, prosecuted or continued
in any forum other than the courts of the state of New York. . . ." (Id.)
(emphasis added). Accordingly, the Court finds that the forum selection
clause applies to the present litigation.
3. Interests of Justice
Plaintiffs have not alleged fraud, influence, or overweening bargaining
power in the formation of the forum selection clause in the
Indemnification Agreement. Therefore, the Plaintiffs bear the burden of
demonstrating why they should not be bound by their choice of forum in
the Indemnification Agreement. Considering the convenience of the parties
and witnesses, the Court finds that the state and federal courts of New
York are no less convenient than this Court. The Court places great
weight on Lazard's preference for the state and federal courts of New
York, particularly because the South Street Funds agreed to accede to
Lazard's preference by entering into the Indemnification Agreement.
The Court will dismiss Plaintiffs' complaint, pursuant to FED.R.CIV.P.
12(b)(6) for failure to state a claim rather than FED.R.CIV.P. 12(b)(3)
for improper venue, based on the following considerations. First, on
October 23, 1997, the Court granted Jackson's motion to transfer, sending
this case to the Southern District of New York for consolidation with the
Hindes action. See supra, at 596. However, on June 3, 1998, the Honorable
Kimba Wood transferred this case back to this District holding that it
should not be consolidated with the New York action. See supra, at 596.
(Lazard had not been joined at that time). Second, Lazard was joined as a
Defendant recently, on March 1, 1999. Because Lazard was joined
recently, dismissal at this time should not unduly prejudice Plaintiffs.
Third, Lazard clearly intended to avoid entanglement in the Salovaara web
of litigation and took reasonable measures to avoid that result by
entering into the Indemnification Agreement with the South Street Funds.
The Court seeks to enforce the intent of parties by dismissing this
action, so that it may be re-filed in a forum specified in the forum
selection clause. This result will prevent this case from being bounced
from this District to another forum and back. In a state or federal court
in New York, this case may be litigated on its own merits and not get
lost in the national "litigation fallout" from the Salovaara—Eckert
"divorce." In the interests of justice, therefore, the Court will grant
Lazard's motion to dismiss the complaint pursuant to FED.R.CIV.P.
Plaintiffs argue that the Court is not authorized, by Rule 12(b)(6), to
dismiss the complaint under the forum selection clause. The Court's
authority is referenced in National Micrographics Systems v. Canon
U.S.A., 825 F. Supp. 671, 679 (D.N.J. 1993) (citing Lambert v. Kysar,
983 F.2d 1110, 1112 n. 1 (1st Cir. 1993) (holding that motions for
dismissal based upon forum selection clauses are founded upon Rule
12(b)(6), not 12(b)(3))). In National Micrographics, as in Jumara and
Reynolds, the court transferred the case to the court specified in the
forum selection clause. Nevertheless, the authority to dismiss the case
pursuant to Rule 12(b)(6) is clearly recognized.
For the foregoing reasons, Jackson's motion to dismiss the complaint is
granted because Plaintiffs claims for violations of sections 10(b) of the
Exchange Act and Rule 10b-5 of the General Rules and Regulations under
the Act and Plaintiffs' common law fraud claims against Jackson failed to
identify a duty to disclose material information concerning the Sale of
the Debt Securities that was owed to Plaintiffs. Alternatively, the Court
finds that Jackson's motion to dismiss the complaint is granted because
Plaintiff Mr. Salovaara is not an adequate representative to derivatively
represent the South Street Funds.
Further, Lazard's motion to dismiss the complaint under the forum
in the Indemnification Agreement, requiring this case to be litigated in
the state or federal courts of New York, is granted pursuant to
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