Judge Denise Cote
Bayerische Landesbank sought leave to file a second amended complaint adding Aladdin Capital Holdings LLC ("ACH") as a defendant in the underlying gross negligence action. Defendant Aladdin Capital Management LLC ("ACM") opposed the motion. Bayerische had filed suit against ACM due to its investment losses as a result of its decision to participate in a collateralized debt obligation know as Aladdin Synthetic CDO II (the "CDO"). Bayerische claimed that ACH held itself out as, and acted as ACM and as a result ACH owed the same duty of care to Bayerische that ACM owed. Although Bayerische was aware that ACH served as ACM’s parent and sole member at the time of filing its original complaint, it only discovered that ACH employees had significant involvement in the structuring, operating, and managing the CDO upon receipt of ACM’s responses. The court reasoned that since the record now indicated that ACM and ACH knew that ACH employees helped make decisions, ACH could not escape suit on Bayerische’s claims solely because Bayerische was ignorant of crucial facts about its role in the direct management of the CDO. It held the requirements for relation back of the amendment were met and granted the motion to amend.
