In regard to Werner and Winkler Backereitechnik, Plaintiff argues that they are successor corporations to Winkler GmbH as Werner is a 100% shareholder of Winkler Backereitechnik, who bought many other assets of Winkler GmbH, and who also owns 100% of Bakery Engineering.

The starting place for analyzing the summary judgment motions is the CPLR itself, which provides in pertinent part that:

CPLR 3212 (b)'s summary judgment provision means that "the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact" necessitating a trial. Alvarez v. Prospect Hosp., 68 NY2d 320, 324 (1986). Proof offered by a moving party must be in admissible form. See Zuckerman v. City of New York, 49 NY2d 557, 562 (1980); Dix v. Pines Hotel, Inc., 188 AD2d 1007 (4th Dept 1992). Failure of the moving party to make the statutorily required prima facie case mandates denial of the motion, regardless of the sufficiency of the opposing papers. See Winegrad v. New York Univ. Med. Ctr., 64 NY2d 851, 853 (1985).

Once a prima facie showing has been made, then "the burden shifts to the party opposing the motion for summary judgment to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action." Alvarez, 68 NY2d at 324. "Bald conclusory assertions, even if believable, are not enough [to defeat summary judgment]." S. J. Capelin Assoc., Inc. v. Globe Mfg. Corp., 34 NY2d 338, 342 (1974). See also State Farm Fire & Cas. Co. v. Ricci, 96 AD3d 1571, 1574 (4th Dept 2012) (reversing denial of summary judgment motion as the opposing party's speculation was insufficient to overcome the same).

In assessing a summary judgment motion, "the focus of the court's concern is issue finding, not issue determination, and the affidavits should be scrutinized carefully in the light most favorable to the party opposing the motion." Robinson v. Strong Mem. Hosp., 98 [*5]AD2d 976 (4th Dept 1983). See also Branham v. Loews Orpheum Cinemas, Inc., 8 NY3d 931, 932 (2007). Moreover, summary judgment is a drastic measure as it deprives a party of his or her day in court and will normally have res judicata effects. See Ugarriza v. Schmieder, 46 NY2d 471, 474 (1979); Harrigan v. Super Products Corp., 237 AD2d 882, 883 (4th Dept 1997).

The remaining portion of each Defendant's motion will next be analyzed under the above standard.

Bakery Engineering is not currently entitled to summary judgment on Plaintiff's claims sounding in successor liability. See e.g. Refermat v. A.C. & S., Inc., 15 AD3d 928 (4th Dept 2005) (affirming the denial of summary judgment to the defendant, a purchasing company, on the issue of successor liability). As in Refermat, the present case reveals issues of fact as to whether Bakery Engineering is liable for the torts of its predecessor Winkler USA.^[FN17] See also Nationwide Mut. Fire Ins. Co. v. Long Is. A.C., Inc., 78 AD3d 801, 802 (2d Dept 2010).

A.Choice of Law.

As a threshold legal matter, and to properly apply the summary judgment standard, this Court must first determine the proper law against which to assess the facts. This Court disagrees with Bakery Engineering that German insolvency law governs this matter thereby relieving it of any successor liability.

Bakery Engineering is correct that the first step in a choice of law analysis is "to determine whether there is an actual conflict between the laws of the jurisdictions involved." Matter of Allstate Ins. Co. (Stolarz), 81 NY2d 219, 223 (1993). See also Bodea v. Trans Nat Express, Inc., 286 AD2d 5, 8 (4th Dept 2001). Here, this Court concludes that the relevant jurisdictions are the country of Germany and New York State, rather than Germany and New Jersey.

Before comparing German and New York law on successor liability, this Court pauses to address Plaintiff's invocation of New Jersey law based upon the ASA's choice of law provision. This Court declines to adopt Plaintiff's invocation of New Jersey law as the controlling legal rule as to whether Bakery Engineering owed Plaintiff a duty of care. The ASA provides that:

The above language is appropriate for a contract dispute situation, as contended by Defendants, but not a tort liability scenario. See generally Hodom v. Stearns, 32 AD2d 234, 236 (4th Dept 1969); J.A.O. Acquisition Corp. v. Stavitsky, 192 Misc 2d 7, 11 (NY Co Sup Ct 2001), aff'd, 293 AD2d 323 (1st Dept 2002). It is not reasonable to allow a contract to define the legal principles and standard of care owed to a non-party such as the present Plaintiff. Plaintiff seems to even acknowledge this, and abandon New Jersey law, by invoking New York's successor liability standards in his proposed Amended Complaint. Nevertheless, and even though it does not define Bakery Engineering's standard of care, the ASA remains relevant to the later successor liability factual question.

Going back to the first step of comparing German law and New York law, this Court concludes that there is a conflict between German insolvency law and New York's law governing the responsibilities, or lack thereof, of an asset purchaser. As explained by Bakery Engineering's multiple expert sources, German insolvency law insulates an asset purchaser from any liability, unless the buyer expressly assumes that obligation. At first blush, New York's law is consistent with this principle of German law because the general rule in New York is "that a corporation which acquires the assets of another is not liable for the torts of its predecessor." Schumacher v. Richards Shear Co., Inc., 59 NY2d 239, 244 (1983). However, and unlike German law which contains only one narrow exception to this general principle, New York law contains a wider range of exceptions, each of which will be discussed in more detail hereinafter. See Grant-Howard Assoc. v. Gen. Housewares Corp., 63 NY2d 291, 296-297 (1984); Meadows v. Amsted Indus., Inc., 305 AD2d 1053, 1054 (4th Dept 2003). Accordingly, New York law provides a greater level of protection for victims of corporate malfeasance and thus has a cognizable interest in affording recourse for that class of people. See generally Doe v. Roe, 190 AD2d 463, 469 (4th Dept 1993) (strong public policy concerns weighed heavily in favor of applying New York's substantive law). This extra protection should not be negated, especially for a New York plaintiff regarding an incident that occurred in New York. See e.g. In re Qimonda AG, 462 BR 165, 185 (Bankr ED Va 2011) (refusing to apply German insolvency law because it would be manifestly contrary to U.S. public policy), aff'd sub nom., Jaffe v. Samsung Electronics Co., Ltd., 737 F3d 14 (4th Cir 2013) [Bakery Engineering Memo., pp. 5-6].

Furthermore, Bakery Engineering's advocacy for German insolvency law based upon United States federal bankruptcy law is unavailing. Contrary to Bakery Engineering's contention [Bakery Engineering Memo., pp. 8-10], applying New York substantive law will not conflict with federal bankruptcy law.^[FN18] The Fourth Department expressly rejected the "assertion that state successor liability was preempted by the proceedings in bankruptcy." Sweatland v. Park Corp., 181 AD2d 243, 247 (4th Dept 1992) (citing Wensing by Wensing [*6]v. Paris Indus. - New York, 158 AD2d 164, 167 (3d Dept 1990) (acknowledging that, even approved bankruptcy court asset purchase agreement, "cannot affect the rights of a stranger to their contract" in a products liability case)). Consequently, Sweatland and Wensing allow a successor liability analysis even after a federal bankruptcy case was initiated, and therefore those cases provide additional legal authority to disregard Germany's insolvency law.

The next step in the choice of law process for a tort case like this is to apply the "interest analysis" test which defers to the laws of the "jurisdiction having the greatest interest in resolving the particular issue." Cooney v. Osgood Mach., Inc., 81 NY2d 66, 72 (1993). See also Mashreqbank PSC v. Ahmed Hamad A1 Gosaibi & Bros. Co., ____ NY3d ____, 2014 NY Slip Op 02381 (04-08-14); Dorsey v. Yantambwe, 276 AD2d 108, 110 (4th Dept 2000). When assessing what jurisdiction's standard of care to impose, "the law of the jurisdiction where the tort occurred will generally apply because that jurisdiction has the greatest interest in regulating behavior within its borders." Cooney, 81 NY2d at 72 (emphasis added). See also Padula v. Lilarn Properties Corp., 84 NY2d 519, 522 (1994); Burnett v. Columbus McKinnon Corp., 69 AD3d 58, 61 (4th Dept 2009). Also significant are the parties' domiciles. See Bodea, 286 AD2d at 9.

In the case at bar, the "interest analysis" test favors applying New York law, as opposed to German insolvency law, to define the scope of Bakery Engineering's standard of care, i.e., liability. Due to the fact that the subject incident took place here in New York, New York has "the greatest interest." Cooney, 81 NY2d at 72; Burnett, 69 AD3d at 61. Even Bakery Engineering's own case-law recognizes the long-standing importance the locale of an incident is in deciding a choice of law question in a tort case. See Elmaliach v. Bank of China Ltd., 110 AD3d 192, 202 (1st Dept 2013) [Bakery Engineering's Memo., p. 6]. See also Poplar v. Bourjois, Inc., 298 NY 62, 66 (1948); Babcock v. Jackson, 12 NY2d 473, 477 (1963). Also, Plaintiff is a New York resident, even though Defendants are not. Together, these two significant factors warrant the application of New York law on successor liability over German insolvency law. See e.g. Thomas v. Hanmer, 109 AD2d 80, 85 (4th Dept 1985) (ruling that New York law should govern the action instead of the foreign law of the Canadian Province of Quebec).

Lastly, Bakery Engineering's main case of Schultz v. Boy Scouts of Am., Inc., 65 NY2d 189 (1985), which applied another state's law to a New York lawsuit, does not compel a different result [Bakery Engineering's Memo., p. 6]. For starters, Schultz is legally distinguishable as it involved a choice of law analysis for a loss-distribution rule, i.e., damages, rather than one regulating conduct, i.e., standard of care. Id. at 195. As a result of this critical distinction, the Court of Appeals rightfully de-emphasized the place of the wrong as well as the parties' domiciles, and instead applied the three-prong test of Neumeier v. Kuehner, 31 NY2d 121 (1972). Unlike Schultz, the legal question in the instant case is whether Defendants owed Plaintiff a standard of care; therefore, the location of the incident remains of utmost importance. See Cooney, 81 NY2d at 72; Bodea, 286 AD2d at 9. Besides the foregoing, Bakery Engineering's further citation to Schultz to shift the burden to Plaintiff to negate the application of German insolvency law is misguided. Schultz's "heavy burden" language was limited to the public policy doctrine exception to the choice of law rule. See Schultz, 65 NY2d at 202. Plaintiff has not invoked that exception, and it is further inapplicable as it comes into play only when the foreign jurisdiction's law [*7]is deemed to be the controlling authority. Id. That is not the case here as this Court has declined to apply German law; thus, Plaintiff carries no burden.

In all, this Court elects to apply New York law to decipher Defendants' standard of care. See Thomas, 109 AD2d at 80.

B.New York's Successor Liability Rule Exceptions.

Under New York law, Bakery Engineering must at this stage continue to litigate its potential successor liability under some of the asset purchaser exceptions. See e.g. Kaur v. Am. Tr. Ins. Co., 19 NY3d 827, 828 (2012) (decreeing that triable issues of fact existed concerning the defendant's successor liability); Meadows, 305 AD2d at 1054 (affirming the denial of summary judgment on the successor liability issue).

As briefly referenced above, there are four exceptions allowing a purchasing corporation to be liable for the torts of its predecessor. See Grant-Howard Assoc., 63 NY2d at 296-297; Meadows, 305 AD2d at 1054. As the Court of Appeals ruled:

For "a successor corporation to establish that it is entitled to summary judgment on the ground that it is not liable, it must demonstrate that none of the four . . . exceptions" apply. Nationwide Mut. Fire Ins. Co., 78 AD3d at 802 (citing Meadows, 305 AD2d at 1054). The Fourth Department classifies the successor liability issue as one that "should be determined at trial rather than by summary disposition." Atkisson v. Manitoba Corp., 192 AD2d 1077 (4th Dept 1993) (modifying order by denying the defendant's summary judgment motion). With the foregoing in mind, the successor liability exceptions as to Bakery Engineering will be hereinafter discussed.

Bakery Engineering proved as a matter of law that it did not in any fashion assume Winkler USA's future product liability obligations. See generally Zuckerman, 49 NY2d at 562; Dix, 188 AD2d at 1007. See e.g. Sweatland, 181 AD2d at 245 (concluding that the purchase agreement did not confer successor liability as there was no implicit or express assumption of liability).

Under the plain wording of the ASA (see W.W.W. Assoc., Inc. v. Giancontieri, 77 NY2d 157, 162 (1990); Kula v. State Farm Fire and Cas. Co., 212 AD2d 16, 19 (4th Dept 1995)), Bakery Engineering unequivocally denounced any assumption of liability for obligations of "any kind or nature, whether actual, contingent or accrued, known or unknown" [DiPalma Atty. Aff., Ex. F, p. 36]. See generally Greenfield v. Philles Records, Inc., 98 NY2d 562, 569 (2002). See e.g. Goldman v. Packaging Indus., Inc., 144 AD2d 533, 535 (2d Dept 1988) (ruling that the corporate defendant expressly disclaimed the assumption of any liability of its predecessor). This clear documentary proof constitutes [*8]a prima facie showing of entitlement to judgment. See e.g. Morales v. City of New York, 18 Misc 3d 686, 689 (Kings Co Sup Ct 2007) (declining to apply the first exception based upon the subject Asset Purchase Agreement's exclusionary language).

In his motion opposition, Plaintiff failed to raise a material issue of fact as to this exception. See generally Alvarez, 68 NY2d at 324. Plaintiff's classification of the ASA's wording as a "blanket assumption of liability" is inaccurate [Kerrigan Atty. Aff., p. 39]. Plaintiff focuses on the language in Section 2, A, (a) (I) that Bakery Engineering was assuming "[a]ll liabilities and/or obligations under or arising in the ordinary course of business prior to and after the Closing Date" [DiPalma Atty. Aff., Ex. F, p. 34 {emphasis for language highlighted by Plaintiff}]. However, Plaintiff omits and ignores the remaining wording that the post-closing liabilities were limited to those "known to the Buyer" as listed in Schedule F [Id.]. Plaintiff's 2006 accident was neither known to Bakery Engineering or indicated in Schedule F, nor could it have been given the timing of the same. This narrowly tailored assumption does not have the "blanket" implication Plaintiff concocts.

Based upon the foregoing irrefutable record evidence, the first exception has no application to this case. See e.g. City of New York v. Charles Pfizer & Co., Inc., 260 AD2d 174, 175 (1st Dept 1999) (finding that the subject contract did not manifest either an express or implied assumption of liability).

The second exception, often referred to as a de facto merger, may ultimately provide Plaintiff with an avenue of relief to hold Bakery Engineering liable. See e.g. Sweatland, 181 AD2d at 245-246 (affirming the denial of the defendant's summary judgment motion because there was an issue of fact as to a de facto merger for a pre-accident asset purchase agreement).

The objective of the de facto merger exception is to provide tort claimants with "protection against attempts by ongoing businesses to avoid liability through transfer of their operations to another legal entity." Id. at 246. Additionally, this second exception implements the conception that a company who essentially purchases the goodwill of another company "should carry the predecessor's liabilities as a concomitant to the benefits it derives from the good will purchased" thereby ensuring that "a source remains to pay for the victim's injuries." Grant-Howard Assoc., 63 NY2d at 296-297. See also Holmberg v. Attractions Land, Inc., 230 AD2d 362, 365 (3d Dept 1997).

Given the preceding objectives, "courts have flexibility in determining whether a transaction constitutes a de facto merger." Sweatland, 181 AD2d at 246 (emphasis added). See also AT & S Transp., LLC v. Odyssey Logistics & Tech. Corp., 22 AD3d 750, 752 (2d Dept 2005). Thus, and in assessing the de facto merger exception, courts consider the following factors:

"However, [n]ot all of these factors are needed to demonstrate a merger; rather, [*9]these factors are only indicators that tend to show a de facto merger.'" Id. at 246 (the de facto merger analysis must be made on a case-by-case basis) (internal citation omitted).

When the de facto merger factors are applied to the present matter against Bakery Engineering, material issues of fact exist which prevent a summary judgment resolution. See e.g. Hoover v. New Holland N. Am., Inc., 71 AD3d 1593 (4th Dept 2010) (affirming the denial of summary judgment motion as it was disputed whether the subject transaction constituted a de facto merger).

For starters, the parties hotly contest Winkler USA's status at the time the ASA was executed. On the one hand, Bakery Engineering alleges that Winkler USA was already dissolved and it assets reverted back to Winkler GmbH; therefore, Bakery Engineering cannot possibly be a successor thereto. On the other hand, Plaintiff raised an issue of fact by proof that Winkler USA continued to exist and did not formally dissolve until 2005. See Fitzgerald v. Fahnestock & Co., Inc., 286 AD2d 573, 575 (1st Dept 2001) ("[s]o long as the acquired corporation is shorn of its assets and has become, in essence, a shell, legal dissolution is not necessary before a finding of a de facto merger will be made"). These juxtaposed factual allegations should be reserved for a jury's consideration. See generally S. J. Capelin Assoc., Inc., 34 NY2d at 341; Craft v. Maier, 167 AD2d 933 (4th Dept 1990). Moreover, and consistent with Plaintiff's position, the ASA designates Winkler USA as the "Seller," not Winkler GmbH [DiPalma Atty. Aff., Ex. F, p. 32]. Also per the ASA, Bakery Engineering was tasked with formally dissolving Winkler USA. Therefore, and upon the motion papers, Winkler USA's exact status at the time of the ASA is unsettled and must be further litigated.

In addition, the intermixing of various facets of Winkler GmbH and Winkler USA with Bakery Engineering trigger the de facto merger exception. See e.g. City of New York v. Aaer Sprayed Insulations, Inc., 281 AD2d 228, 229 (1st Dept 2001) (affirming the denial of summary judgment to the defendant on the de facto merger exception due to the cessation of the predecessor's operations which the defendant continued "at the same physical location, and with the same assets, general business operation, and many of the same personnel").

Even though Winkler USA's owner may not be the same as Bakery Engineering's, Bakery Engineering was formed mainly to purchase what appears to be the entirety of Winkler USA from Grub. See Societe Anonyme Dauphitex v. Schoenfelder Corp., 2007 WL 3253592, at *5 (SDNY 2007) (the de facto merger exception can apply when "it was the intent of [the successor] to absorb and continue the operation of [the predecessor]"). Of further particular significance is Winkler USA's President's continued leadership role as Bakery Engineering's President.^[FN19] Contrary to Bakery Engineering's contention, this one potential missing ownership factor is not fatal as all of the other factors are present. See [*10]Sweatland, 181 AD2d at 246. Cf. In re New York City Asbestos Litig., 15 AD3d 254, 256 (1st Dept 2005) (rejecting de facto merger exception because, besides uncommon ownership, another factor was also missing); Buja v. KCI Konecranes Intern. Plc., 12 Misc 3d 859, 865 (Monroe Co Sup Ct 2006) (same) [Bakery Engineering Memo., p. 13].

Bakery Engineering does not affirmatively disprove the other factors [Bakery Engineering Memo., pp. 13-14]. See Nationwide Mut. Fire Ins. Co., 78 AD3d at 802. As already discussed, Winkler USA's exact status is debatable; however, no party disagrees that Winkler USA was no longer engaged in active business operations. Under the ASA, Bakery Engineering took control over all of the necessary items to continue Winkler USA's work, namely inventory, including essential customer lists, customer contracts, accounts receivable, and balance sheet assets. Of importance is Bakery Engineering's purchase of the Winkler USA name, logos, and trademarks and thus the accompanying goodwill. See Grant-Howard Assoc., 63 NY2d at 296-97; Holmberg, 230 AD2d at 365. After the ASA, Bakery Engineering engaged in the exact same work as Winkler USA; to wit, producing and service bakery equipment. In fact, Wegmans remained on as a customer. So effortless was the transformation that the companies' customers did not even notice any change. In fact, and according to Gutierrez, the customer's perception was that Winkler USA and Bakery Engineering were the same company because the same people remained on as the point of contact.

Also, Bakery Engineering assumed the lease for Winkler USA's office space and warehouse and, for a period of time, operated out of the exact same location. Further, there was continuity of management and personnel between Winkler USA and Bakery Engineering. The ASA required Bakery Engineering to "assume all employees of Winkler [USA]" [DiPalma Atty. Aff., Ex. F, p. 34]. Bakery Engineering implemented this requirement retaining at least one supervisor who still worked with the company and several technicians, albeit not permanently. Most importantly, Bakery Engineering ensured continuity of management by retaining Domenicucci in the key role of President.

In total, this Court finds that there is sufficient overlap between the companies to allow a jury to decide whether there was a de facto merger resulting in Bakery Engineering's successor liability. See Hoover, 71 AD3d at 1593; Sweatland, 181 AD2d at 245-246.

The third exception may also apply to Bakery Engineering. See e.g. Meadows, 305 AD2d at 1054 (ruling that one corporate defendant was not a "mere continuation, but finding issues of fact as to whether another corporate defendant qualified as the same).

The "mere continuation" exception "refers to corporate reorganization, however, where only one corporation survives the transaction; the predecessor corporation must be extinguished." Schumacher, 59 NY2d at 245.

As previously indicated, Plaintiff raised issues of fact as to Winkler USA's pre and post ASA corporate existence which militate against adjudicating as a matter of law the "mere continuation" exception. See e.g. Burgos v. Pulse Combustion, Inc., 227 AD2d 295 (1st Dept 1996) (the trial-level court correctly found issues of fact bearing upon the defendant's possible "mere continuation" successor liability).

A final determination of the "mere continuation" exception as to Winkler USA must await a trial. Id.

The last exception is wholly without merit on the present record. See e.g. State Farm Fire & Cas. Co. v. Main Bros. Oil Co., 101 AD3d 1575, 1577 (3d Dept 2012) (because no evidence of fraud existed, the fourth exception did not apply).

Bakery Engineering set forth a prima facie case that the ASA was not entered into fraudulently to escape any obligations of either Winkler GmbH or Winkler USA. See generally Zuckerman, 49 NY2d at 562; Dix, 188 AD2d at 1007. The most compelling proof negating a fraudulent conveyance is the undisputed fact that the ASA was negotiated and overseen by a neutral bankruptcy trustee.

In his response, Plaintiff was unable to rebut Bakery Engineering's motion proof. See generally Alvarez, 68 NY2d at 324. Plaintiff provides no admissible proof besides mere speculation that the ASA was fraudulent. Such conjecture is insufficient to raise a triable issue of material fact deserving of trial consideration. See generally S. J. Capelin Assoc., Inc., 34 NY2d at 342; State Farm Fire & Cas. Co., 96 AD3d at 1574. In fact, and contrary to his motion position, Plaintiff's proposed Amended Complaint does not invoke the fraud exception [Kerrigan Atty. Aff., Ex. # 9, p. 33, ¶ 76].

Accordingly, Bakery Engineering cannot face successor liability under the fraud exception.

In conclusion of Bakery Engineering's motion, New York law applies and, under the same, there are genuine issues of fact as to its successor liability as a de facto merger, as well as a "mere continuation" of Winkler USA. See e.g. Drexler v. Highlift, Inc., 277 AD2d 196, 197 (2d Dept 2000) (reversing grant of summary judgment because one or more of the successor liability exceptions might apply).

Werner and Winkler Backereitechnik are not yet entitled to summary judgment relief. See Hoover, 71 AD3d at 1593; Sweatland, 181 AD2d at 245-246.

Having already resolved the choice of law issue, and outlined in great detail the legal principles of successor liability, each exception is analyzed hereinafter as to Werner and Winkler Backereitechnik in regard to Winkler GmbH.^[FN20]

1.Assumption of Liability.

As a preliminary matter, the record is unassailable that the May 2001 sale of some Winkler GmbH assets was to Winkler Backereitechnik only, not Werner [Ruff Atty. Aff., Ex. L, Ex. B, p. 2]. Consequently, Werner has no successor liability exposure as to Winkler GmbH under this exception.

Nevertheless, and even imputing contractual participation to Werner (see generally Computersearch Corp. v. ECL Indus., Inc., 142 AD2d 961 (4th Dept 1988) (parent corporation can be held liable for the contractual obligation of a subsidiary if it exercised complete domination and control over the same)), Werner and Winkler Backereitechnik proved that they did not in any manner assume Winkler GmbH's future liabilities. See generally Zuckerman, 49 NY2d at 562; Dix, 188 AD2d at 1007. See also Sweatland, 181 [*11]AD2d at 245. The Sales Agreement contains two separate provisions which disclaim any liability of Winkler GmbH [Ruff Atty. Aff., Ex. L, Ex. B, p. 10, § 7; p. 11, § 8]. See Goldman, 144 AD2d at 535; Morales, 18 Misc 3d at 689. Plaintiff failed to contest this clear contractual defense. See generally Alvarez, 68 NY2d at 324.

In light of the above, the first exception cannot be utilized against either Werner or Winkler Backereitechnik. See City of New York, 260 AD2d at 175.

Again applying the Fourth Department's directive that a de facto merger exception analysis involves a question of fact (see Atkisson, 192 AD2d at 1077), this second exception has potential implications against both Werner and Winkler Backereitechnik. See e.g. Hoover, 71 AD3d at 1593; Sweatland, 181 AD2d at 245-246.

Werner and Winkler Backereitechnik did not make out a prima facie case of their entitlement to judgment as a matter of law. See generally Winegrad, 64 NY2d at 853. See Nationwide Mut. Fire Ins. Co., 78 AD3d at 802. Their moving papers themselves raised issues of fact over the de facto merger factors. For example, the Sales Agreement provided by Werner and Winkler Backereitechnik specifically states that the conveyance was Winkler GmbH's "entire program," which included the subject Admiral Line, and a large quantity of other important assets [Ruff Atty. Aff., Ex. L, Ex. B, pp. 4-6, § 3]. Also, the Sales Agreement references the scope of the sale as ensuring a "smooth takeover" [Ruff Atty. Aff., Ex, L, Ex. B, p. 6, § 3, ¶ 3; see also p. 9, § 6]. In all, the Sales Agreement reflects a sale of a substantial portion of Winkler GmbH's assets, or at the very least, suggests a question of fact concerning the same.

Werner and Winkler Backereitechnik try to preemptively counter the above by referring to the prior sale to Wachtel, which was limited to a baking oven program. However, the Wachtel contract is not provided, and without the same, the Court cannot make a determinative quantitative analysis of the relative apportionments of the sales. This uncertainty is further compounded by the lack of the cited Appendices to the Winkler Backereitechnik Sales Agreement. In fact, it appears that the parties are unsure of what, if anything, of Winkler GmbH remained after the third sale to Winkler Backereitechnik. Werner and Winkler Backereitechnik have not presented sufficient proof that the May 2001 Sales Agreement did not encompass substantially all of Winkler's GmbH's assets. See Nationwide Mut. Fire Ins. Co., 78 AD3d at 802.

Moreover, Werner's and Winkler Backereitechnik's own papers reflect further de facto merger factors. Like Bakery Engineering, Winkler Backereitechnik was created about the same time as the Sales Agreement thereby calling into question the purpose of its formation. See Societe Anonyme Dauphitex, 2007 WL 3253592 at *5. Katterman's testified that Winkler GmbH employees were retained, and consistent with the Sales Agreement, various Winkler GmbH locations were utilized. Additionally, and very importantly, Katterman admitted that Winkler Backereitechnik followed in Winkler GmbH's footsteps and initially manufactured bakery equipment before a few years later transitioning to the sale of pre-fabricated spare parts. This is consistent with the Sale Agreement's objective of ensuring a "smooth takeover" of Winkler GmbH's operations [Ruff Atty. Aff., Ex, L, Ex. B, p. 6, § 3, ¶ 3].

Taking all of the preceding as a whole, and on the record presented by Werner and Winkler Backereitechnik, this Court is unable to adjudicate as a matter of law that the de [*12]facto merger exception cannot be applied to them. See City of New York, 281 AD2d at 229.^[FN21]

In the alternative, Plaintiff raised a triable issue of material fact. See generally Alvarez, 68 NY2d at 324. In particular, Plaintiff's opposition highlighted the incestuous nature of the relationships between Werner and Winkler Backereitechnik and Bakery Engineering, namely that both Winkler Backereitechnik and Bakery Engineering are either directly or indirectly owned by Werner [DiPalma Atty. Aff., Ex. F, p. 7, ¶ 10; Ruff Atty. Aff., ¶ 14; Ex. H, p. 11, ¶ 15]. As explained by Katterman, Werner - a holding company - is owned by a single shareholder, Mr. Horstmann. Given the seemingly closely held nature of Werner, and its ownership of the co-defendants, Plaintiff seeks to impose liability directly on Werner, in addition to Winkler Backereitechnik. In other words, Plaintiff is attempting to pierce the corporate veil. See generally Youngs v. Kissing Bridge Ski Corp., 216 AD2d 967 (4th Dept 1995). Further discovery, which this Court is permitting, may clarify the exact dynamics between Werner and Winkler Backereitechnik. See CPLR 3212 (f); Gmerek v. Scrivner, Inc., 221 AD2d 991 (4th Dept 1995) (reversing the grant of summary judgment to the corporate defendants on issue of parent/subsidiary liability and directing further discovery on the same).

This third exception is not a viable option for Plaintiff. See e.g. Sweatland, 181 AD2d at 245 (finding that the "mere continuation" exception was not applicable).

As previously indicated, the "mere continuation" exception mandates that the predecessor corporation be extinguished. See Schumacher, 59 NY2d at 245. Continuation of the predecessor in bankruptcy protection negates the "mere continuation" exception because the predecessor is not considered extinguished. See Sweatland, 181 AD2d at 245.

In the case at hand, it is yet unsettled what remained of Winkler GmbH after the third sale to Winkler Backereitechnik, especially because Winkler GmbH survived the 2001 Sales Agreement and remained in bankruptcy protection likely winding up its affairs until May of 2008. Consequently, neither Werner and Winkler Backereitechnik are a "mere continuation" of Winkler GmbH. See Hoover, 71 AD3d at 1594; Sweatland, 181 AD2d at 245.

As with the earlier ASA, the Sales Agreement with Winkler Backereitechnik bears [*13]no fraudulent hallmarks. See State Farm Fire & Cas. Co., 101 AD3d at 1577. Plaintiff does not even include this last exception in his proposed Amended Complaint [Kerrigan Atty. Aff., Ex. # 9, p. 34, ¶ 78]. Because this final exception is neither alleged, nor supported by any proof, it cannot be a basis for successor liability against Werner and Winkler Backereitechnik.

In sum, and as with Bakery Engineering, Werner and Winkler Backereitechnik must for now defend against Plaintiff's claims, and the cross-claims, at a trial. See Drexler, 277 AD2d at 197.

Based upon all of the foregoing, it is the Decision of this Court that the remaining portions of both sets of summary judgment motions are DENIED WITHOUT PREJUDICE. The denial is without prejudice due to the fact that the Note of Issue is going to be stricken and the parties will be engaging in further discovery given the impending submission of an Amended Complaint.

Plaintiff is directed to submit to the Court, on notice to all opposing counsels, a proposed Order encompassing the entirety of this Court's summary judgment rulings, along with new proposed Scheduling Order dates.