Morgan Stanley Wins Dismissal of Claims with Prejudice in Lawsuit Related to Italian Shipping Company’s Restructuring

On August 5, 2022, the New York Supreme Court, Commercial Division, dismissed with prejudice a lawsuit brought by Moby S.p.A., one of the world’s largest passenger shipping companies, against Cravath client Morgan Stanley and two of its employees. The lawsuit was related to Moby’s restructuring proceeding in Milan, Italy.

In its complaint, Moby asserted tortious interference claims against two of its creditors—Morgan Stanley and an Italian investor, Antonello Di Meo—for allegedly interfering with Moby’s business relations with a subset of creditors who supported Moby’s restructuring plan. Specifically, Moby claimed that Morgan Stanley and Di Meo were attempting to obtain a controlling majority of Moby’s bonds so they could thwart Moby’s restructuring plan, force it into liquidation and take control of the company.

The lawsuit was originally brought by Moby in the U.S. District Court for the Southern District of New York in September 2021, but after Cravath succeeded in opposing an emergency motion by Moby for a TRO and filed a pre‑motion letter indicating it would file a motion to dismiss, Moby voluntarily dismissed the case and refiled the next day in New York Supreme Court. After Cravath moved to dismiss in state court, Moby removed the case to the U.S. Bankruptcy Court for the Southern District of New York and attempted to transfer the case to the U.S. Bankruptcy Court for the Southern District of Florida, where Moby had filed a Chapter 15 petition seeking recognition of its foreign bankruptcy proceeding. Cravath successfully opposed the removal and transfer, and the case was remanded back to the New York Supreme Court.

Virtual oral argument was held on Friday, August 5, 2022, before Justice Jennifer G. Schecter of the New York Supreme Court, Commercial Division. During the argument, Justice Schecter squarely rejected Moby’s theory of tortious interference, concluding that “there has been no interference and there are no damages that are recoverable,” and ruled from the bench, dismissing the case in its entirety with prejudice.

The Cravath team included partners Michael A. Paskin, who argued the motion to dismiss, Paul H. Zumbro, who argued the remand and transfer issues in bankruptcy court, and Lauren M. Rosenberg, practice area attorney Alexander Gerten and associates Hannah Dwyer, Brian P. Golger, John A. Marcin and Matthew A. Robinson.

The case is Moby S.p.A. v. Morgan Stanley, et al., No. 159425/2021 (Sup. Ct. N.Y. Cnty. 2021).