IBERDROLA ENERGY PROJECTS v. 50 (2026)

Judgment, Supreme Court, New York County, entered May 7, 2025, dismissing, with prejudice, plaintiff's second amended complaint, and bringing up for review an order, same court (Jennifer G. Schecter, J.), entered February 26, 2025, which granted defendants' motion to dismiss plaintiff's second amended complaint, with prejudice, unanimously affirmed, with costs.

Plaintiff failed to plead the element of detrimental reliance in support of its causes of action for fraud.  Plaintiff alleges that defendants' misrepresentations and omissions caused it to incur additional labor, costs and expenses as part of its obligations under the Engineering, Procurement, and Construction contract (EPC).  Notably, however, none of the allegations supporting plaintiff's fraud claims rely on any misrepresentations or failures to disclose by defendants that are collateral to the contract (see Iberdrola Energy Projects v Oaktree Capital Mgt. L.P., 231 AD3d 33, 45 [1st Dept 2024] ).  Thus, plaintiff's fraud claims fail because the conduct into which plaintiff was allegedly induced consisted of pre-existing obligations under the EPC (see Megaris Furs v. Gimbel Bros., 172 A.D.2d 209, 212 [1st Dept 1991] ).

Plaintiff's renewed challenge to the enforceability of the work-pending-dispute clause is barred by the doctrine of law of the case, as we decided this issue on the prior appeal (see Iberdrola Energy Projects, 231 AD3d at 36–37;  Matter of Child A. [Parent M.], 228 AD3d 858, 860 [2d Dept 2024] ).

To the extent plaintiff contends that its renewed argument is based on newly discovered facts, it is still without merit.  Any breach by defendants did not cause the dispute resolution procedures to “fail of their purpose” (cf.  Granite Computer Leasing Corp. v Travelers Indem.  Co., 894 F.2d 547, 552 [2d Cir1990] ), particularly where, as here, plaintiff was able to use those procedures to advance to an arbitration in which it was awarded approximately $230 million.

We decline to revisit our prior ruling on the enforceability of the nonrecourse provision.  The exculpatory clause in One River Run Acquisition, LLC v Milde (239 AD3d 519, 520–521 [1st Dept 2025] ) was narrower than the nonrecourse provision in the EPC. Accordingly, there is no conflict between our prior order in this case and One River Run.