Opposition — Blue Flame Medical LLC v. Chain Bridge Bank, N.A., et al.

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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
(Alexandria Division)
BLUE FLAME MEDICAL LLC,

Plaintiff,
v.
CHAIN BRIDGE BANK, N.A.,
JOHN J. BROUGH, and
DAVID M. EVINGER,

Defendants.

Civil Action No. 1:20-cv-00658 (LMB/IDD)

CHAIN BRIDGE BANK, N.A.,

Third-Party Plaintiff,
v.
JPMORGAN CHASE BANK, N.A.,

Third-Party Defendant.

JPMORGAN CHASE BANK, N.A.’S MEMORANDUM IN OPPOSITION TO
CHAIN BRIDGE BANK, N.A.’S MOTION FOR SUMMARY JUDGMENT

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TABLE OF CONTENTS

TABLE OF AUTHORITIES .......................................................................................................... ii
INTRODUCTION ...........................................................................................................................1
RESPONSE TO CHAIN BRIDGE’S STATEMENT OF UNDISPUTED FACTS ........................3
ARGUMENT .................................................................................................................................10
I.
CHAIN BRIDGE’S INDEMNIFICATION CLAIM FAILS ..............................................................10
A.
Indemnification Under U.C.C. § 4A-211(f) Is Inapplicable Because
Chain Bridge Requested And Directed The Cancellation .....................................10
1.
Chain Bridge’s legal argument is incorrect ...............................................11
2.
The facts do not support Chain Bridge’s indemnification claim ...............13
B.
The Parties’ Agreement Did Not Include Any Obligation By JPMC
To Indemnify Chain Bridge ...................................................................................16
C.
Chain Bridge Cannot Establish Causation .............................................................18
II.
CHAIN BRIDGE’S UNJUST-ENRICHMENT CLAIM FAILS, AND ITS NEWLY ASSERTED
PAYMENT-BY-MISTAKE CLAIM IS IMPROPER AND MERITLESS ..........................................20
III.
JPMC’S AFFIRMATIVE DEFENSE OF EQUITABLE ESTOPPEL PRECLUDES SUMMARY
JUDGMENT FOR CHAIN BRIDGE ..........................................................................................22
CONCLUSION ..............................................................................................................................24
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TABLE OF AUTHORITIES

Page(s)
CASES
Aetna Casualty & Surety Co. v. Maryland Casualty Co.,
18 Va. Cir. 162 (Va. Cir. Ct. 1989)....................................................................................21
Anderson v. Fluor Intercontinental, Inc.,
2021 WL 837335 (E.D. Va. Jan. 4, 2021) .........................................................................20
Banca Commercial Italiana v. Northern Trust Int’l Banking Corp.,
160 F.3d 90 (2d Cir. 1998).................................................................................................13
Branch Banking & Tr. v. Witmeyer,
2011 WL 3297682 (E.D. Va. Jan. 6, 2011) .......................................................................24
Dataflow, Inc. v. Peerless Insurance Co.,
2014 WL 148685 (N.D.N.Y. Jan. 13, 2014) ......................................................................17
Hair Club for Men, LLC v. Ehson,
2016 WL 3636851 (E.D. Va. May 6, 2016) ......................................................................21
Hamed v. Saul,
432 F. Supp. 3d 610 (E.D. Va. 2020) ................................................................................23
Harris v. Reston Hospital Center, LLC,
523 F. App’x 938 (4th Cir. 2013) ......................................................................................21
Horton v. United States,
622 F.2d 80 (4th Cir. 1980) ...............................................................................................12
Integrated Direct Marketing, LLC v. May,
129 F. Supp. 3d 336 (E.D. Va. 2015), aff’d, 690 F. App’x 822 (4th Cir. 2017)................21
Liberty Mutual v. Williams Int’l Indus., Inc.,
780 F. Supp. 359 (E.D. Va. 1991) .....................................................................................22
Newcom Holdings Pty., Ltd. v. Imbros Corp.,
369 F. Supp. 2d 700 (E.D. Va. 2005) ................................................................................23
Newton v. Newton,
118 S.E.2d 656 (Va. 1961).................................................................................................22
Orbit Corp. v. FedEx Ground Package Systems, Inc.,
2016 WL 6609184 (E.D. Va. Nov. 8, 2016) ......................................................................21
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United States v. Ndutime Youth & Family Services,
2020 WL 5507217 (E.D. Va. Sept. 11, 2020)....................................................................21
United States v. Seckinger,
397 U.S. 203 (1970) ...........................................................................................................12
Veolia Es Special Services, Inc. v. Techsol Chemical Co.,
2008 WL 11380183 (S.D. W.Va. Oct. 14, 2008) ..............................................................23
White v. Johns-Manville Corp.,
662 F.2d 243 (4th Cir. 1981) .......................................................................................11, 12
STATUTES
U.C.C.
§ 1-201 .........................................................................................................................17, 18
§ 4A-105 ............................................................................................................................12
§ 4A-106 ............................................................................................................................12
§ 4A-210 ......................................................................................................................12, 13
§ 4A-211 .................................................................................................................... passim
OTHER AUTHORITIES
42 C.J.S. Indemnity § 2 ..................................................................................................................11
49 C.J.S. Judgments § 304 .......................................................................................................22, 23

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INTRODUCTION
Indemnification under U.C.C. § 4A-211(f) is not meant to protect a party from its self-
interested decision-making.  Accordingly, the statute only provides for indemnification where
the sending bank seeks to reverse a wire and the receiving bank in turn agrees—not when the
receiving bank (in this case, Chain Bridge) seeks and obtains a cancellation from the sending
bank for its own self-interested reasons, which is what happened here.  That straightforward
conclusion accords with the purpose of indemnification, which is premised on the principle that a
party should be responsible for the consequences of its actions.  Chain Bridge wants to avoid the
consequences of its actions, however, and so it asks the Court to adopt a contrary rule.  But
Chain Bridge is wrong on the law and presents an incomplete version of the facts.  Its motion for
summary judgment should be denied.
As JPMC detailed in its motion for summary judgment, Chain Bridge—in possession of
the $456 million wired for the benefit of its client—explicitly requested and directed the wire’s
return.  It did so because of its own serious concerns about its client, its capital requirements, and
its obligations under the Bank Secrecy Act.  The record is clear that, from the moment Chain
Bridge learned about the wire, the bank had no intention of ever allowing the funds to go to Blue
Flame.  Chain Bridge immediately placed the funds on hold and ceased all communication with
its client so that it could choreograph the return of the wire uninterrupted.  Chain Bridge then
pressed for the wire’s return:  first with California and then with JPMC—expressly requesting
that JPMC reverse the wire, just as Chain Bridge’s policy required.
Chain Bridge cannot dispute these facts, so it simply avoids them and omits them from its
statement of facts.  And, while avoiding mention of its own acts, Chain Bridge’s central refrain is
that its motivations are irrelevant.  According to Chain Bridge, that is because § 4A-211 does not
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contemplate a wire’s cancellation by the receiving bank; only a sending bank, Chain Bridge says,
can cancel a wire.  That argument is irrelevant and wrong.
The question here is about indemnification, not cancellation:  specifically, whether Chain
Bridge satisfies the elements of § 4A-211(f).  And under § 4A-211(f), indemnification only
applies “if the receiving bank … agrees to cancellation … of the order by the sender.”  Where
the situation is the reverse—a cancellation requested and directed by a receiving bank, not the
sender—§ 4A-211(f) does not apply.  Whether and how a receiving bank or a sending bank can
cancel a wire, effectively or ineffectively, is beside the point.  But in any event, Article 4A
recognizes that receiving banks, just like senders, can effect cancellations.
Chain Bridge’s indemnification claim fails for several additional, independent reasons.
Chain Bridge agrees with JPMC, on the law, that an “agreement” between banks can override an
indemnification obligation under § 4A-211(f).  But it then says, on the facts, that there “was no
agreement.”  The record shows otherwise.  As reflected by the parties’ discussions and course of
conduct, there was an agreement between Chain Bridge and JPMC to return the wire, and it did
not include any indemnification obligation.  An internal Chain Bridge phone call—nowhere
mentioned in Chain Bridge’s brief—underscores the point.  In response to an employee’s
suggestion that Chain Bridge obtain an indemnity letter from JPMC, Chain Bridge’s President
and CEO waved the concern away:  “Just return [the wire] to the same place it came from,” and
“[d]on’t worry about [the indemnity letter]. … [T]his is what we have to do.”  The call confirms
Chain Bridge’s contemporaneous understanding that JPMC had not expressly or impliedly
promised any indemnification, and that Chain Bridge would return the wire nonetheless.  That
understanding was correct, and it controls here.
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Chain Bridge also agrees with JPMC, on the law, that causation is a required element for
indemnification, meaning that any “loss and expenses” for which Chain Bridge seeks
indemnification must have been caused by JPMC’s conduct.  But it ignores the undisputed facts
that make clear that Chain Bridge had no intention of ever allowing the funds to make their way
to Blue Flame.  Indeed, Chain Bridge’s policy required that it return the wire, and Chain Bridge
closed Blue Flame’s accounts and severed all ties with its client on the same day it returned the
wire.  Chain Bridge cannot now credibly say that it would have paid Blue Flame; indeed, Chain
Bridge told California the opposite—that it “would be happy to return the wire.”
Chain Bridge’s unjust-enrichment claim fails for the elemental reason that Chain Bridge
did not confer any benefit on JPMC.  Instead of defending the claim it asserted, Chain Bridge
seeks to amend its complaint through its brief.  That tack is impermissible, and the newly
asserted payment-by-mistake claim is in any event meritless for multiple reasons, including that
JPMC returned all the funds to California.
Finally, Chain Bridge’s motion should be denied because it failed to address, let alone
refute, JPMC’s affirmative defense of equitable estoppel, which bars Chain Bridge’s recovery.
The parties are before the Court on cross motions for summary judgment.  For the
reasons set forth in JPMC’s opening brief, JPMC is entitled to judgment on Chain Bridge’s third-
party claims.  In the event the Court disagrees, then the correct result is to proceed to trial.  At
very best for Chain Bridge, there are substantial questions about its conduct—including whether
it independently caused Blue Flame’s damages (if any) on its statutory claims—that preclude
summary judgment in Chain Bridge’s favor.
RESPONSE TO CHAIN BRIDGE’S STATEMENT OF UNDISPUTED FACTS
As the Court is aware, the parties simultaneously moved for summary judgment.  See
JPMC Mem. in Support of Mot. for Summ. J. (JPMC MSJ) (Dkt. 113); Chain Bridge Mem. in
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Supp. of Mot. for Summ J. (CB MSJ) (Dkt. 123).  As JPMC set forth in its accompanying
Statement of Undisputed Facts (JPMC SUF) (Dkt. 113 at 3-12), incorporated by reference here,
the record shows that Chain Bridge sought and obtained the wire’s cancellation for its own
reasons.  Thus, Chain Bridge expressly requested the wire’s reversal, and directed that reversal
through its own decisive, affirmative steps.  JPMC SUF ¶¶ 1-47.  Moreover, Chain Bridge did so
without any understanding or expectation that it would be indemnified by JPMC.  Id. ¶¶ 48-52.
Indeed, the parties agreed otherwise through their communications and course of conduct, and,
on an internal Chain Bridge phone call, the bank’s highest two executive officers disclaimed the
need for JPMC to indemnify Chain Bridge.  Id.  Chain Bridge then severed its relationship with
Blue Flame on the very day the wire was reversed, ceasing communication with Blue Flame and
closing all of its accounts.  Id. ¶¶ 53-59.
Chain Bridge’s Statement of Undisputed Facts casts no doubt on any of that.  Chain
Bridge nonetheless paints an incomplete picture through significant omissions—including
omitting any reference to the internal Chain Bridge phone call about indemnification—and
introduces various inaccuracies.  Thus, under Local Civil Rule 56(B), JPMC responds to the
specific paragraphs in Chain Bridge’s Statement as follows:
1-6.
Undisputed.
7.
Disputed:  This statement is incomplete because it omits the facts showing that
Chain Bridge developed and acted on its own concerns about the wire before any interactions
with JPMC.  Before speaking a word to JPMC, Chain Bridge employees up to the highest level
of the bank—including the President (David Evinger), Chief Executive Officer (John Brough),
Chairman of the Board of Directors (Peter Fitzgerald), and Chief Financial Officer (Joanna
Williamson):
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 were involved in how to deal with the wire (see Dkt. 113-5, CBB00000761 at
761; Dkt 113-6, CBB00002797; see also JPMC SUF ¶ 3);
 expressed concerns that the wire was a “scam” (see Dkt. 113-5, CBB00000761 at
761; Dkt. 113-7, CBB00002798 at 8:23-8:49; Dkt. 113-10, Evinger Dep. 205:21-
206:8; Dkt. 113-9, Grice BSA/AML Rep. ¶ 75; see also JPMC SUF ¶ 7);
 exchanged warnings that the wire would have a negative effect on Chain Bridge’s
capital requirements (see Dkt. 113-7, CBB00002798 at 3:07-3:12; Dkt 113-6,
CBB00002797 at 2:26-2:30; Dkt. 113-5, CBB00000761 at 761; Dkt. 113-3,
CBB00000661 at 670; see also JPMC SUF ¶ 4);
 communicated a need to get the funds off of the bank’s books (see Dkt. 113-7,
CBB00002798 at 3:07-3:12; Dkt. 113-3, CBB00000661 at 662, 667; see also
JPMC SUF ¶ 4);
 stated disbelief that Blue Flame had a right to the funds (see Dkt. 113-5,
CBB00000761 at 761; Dkt. 113-7, CBB00002798 at 8:23-8:49; Dkt. 113-9, Grice
BSA/AML Rep. ¶ 75; see also JPMC SUF ¶ 7);
 engaged the bank’s internal Bank Secrecy Act (BSA) team (see Dkt. 113-8,
Brough Dep. 207:6-9; Dkt. 113-7, CBB00002798 at 11:51-11:54; see also JPMC
SUF ¶¶ 5-6); and
 took the extraordinary step of directly contacting JPMC’s customer, California—
three times—to inquire about the wire (see Dkt. 113-19, CBB00004323 at 4333-
4335; Dkt. 113-20, CBB First Interrogatory Responses at 3; Dkt. 113-21,
DGS6548 at 6549; Dkt. 113-22, Gonzales Dep. 97:22-98:22; Dkt. 113-23, Baxter
Rep. ¶¶ 42, 74; see also JPMC SUF ¶¶ 17-20).
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It is therefore incomplete to state only that Chain Bridge “had placed a hold on the wired funds”
(CB SUF ¶ 7) by the time of the first conversation between the banks.
This statement is also incomplete because it omits facts concerning the representations
Chain Bridge made to JPMC about the status of the wire on the parties’ first call, at 12:30 p.m.
ET.  Specifically, Chain Bridge represented to JPMC that it was “holding the funds,” which
made clear to JPMC that the funds had not been credited to Blue Flame’s account.  See Ex. 1 to
Second Loretta Decl., Coffey Dep. 69:3-5 (describing 12:30 p.m. ET call with Evinger during
which Evinger said that Chain Bridge was “holding the funds, which [was] terminology that
would mean [the funds] never hit the beneficiary’s account”);1 Ex. 2, Korpal Dep. 63:3-9 (Chain
Bridge “confirmed that the transaction had not been credited to Blue Flame Medical’s account”).
But Chain Bridge stated internally that it had “credited the customer’s account.”  Dkt. 113-24,
CBB00002789 at 2:23-2:27.  JPMC in turn relied on Chain Bridge’s representation in
determining whether to accommodate Chain Bridge’s request to return the wire.  See Ex. 2,
Korpal Dep. 39:13-17, 40:6-9 (testifying that, where funds have been credited to a beneficiary,
the beneficiary must authorize the reversal of funds, and that JPMC understood that Blue Flame
“had not authorized the return of funds to JPM[C].”).
8.
Disputed:  This statement is incomplete because it describes only one side of the
12:44 p.m. ET call, omitting what Chain Bridge said to JPMC.  On that call, Chain Bridge told
JPMC that the Blue Flame account was brand new, that it was opened by a lobbyist, and that the
size of the wire was unusual for this client—none of which JPMC knew before.  See Dkt. 113-
26, CBB00002541 at 0:39-3:22; see also JPMC SUF ¶ 27.  JPMC would not have known that

1
Exhibits to the Second Loretta Declaration, filed contemporaneously with this brief, are
cited here as “Ex. ___.”  Exhibits to the First Loretta Declaration (Dkt. 113-1) are cited here by
docket number.
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significant information but for Chain Bridge sharing it.  It is also incomplete to present only the
fact that JPMC was conducting an investigation without acknowledging Chain Bridge’s
investigation and the affirmative steps Chain Bridge took to ensure that the funds remained
inaccessible to Blue Flame.  See supra pp.4-6; see also JPMC SUF ¶¶ 2-7, 17-20.
9.
Disputed:  This statement is incomplete because it omits material events that
transpired between the 12:44 p.m. ET phone call and the 1:34 p.m. ET phone call, and it
obscures the initiation of the 1:34 p.m. ET call.2
Concerning the omitted events, Chain Bridge does not reference three communications it
had with California—all of which took place before the 1:34 p.m. ET call between the banks.  In
a voicemail to Evinger at 12:51 p.m. ET, and in a subsequent phone call at 12:55 p.m. ET with
Brough and Evinger, Fee Chang of the California Department of General Services confirmed to
Chain Bridge the legitimacy and amount of the wire.  See Dkt. 113-28, CBB00000707 at 0:19-
0:26; Dkt. 113-29, CBB00002543 at 0:01-0:04; Dkt. 113-10, Evinger Dep. 247:19-248:1; see
also JPMC SUF ¶ 30.  On the 12:55 p.m. ET call with Chang, Chain Bridge requested to be put
in contact with the California State Treasurer’s Office (STO).  See Dkt. 113-29, CBB00002543
at 0:42-0:47; see also JPMC SUF ¶ 31.
Per Chain Bridge’s request, at 1:19 p.m. ET, Mark Hariri and Natalie Gonzales of the
STO called Chain Bridge and spoke with Brough and Evinger about the wire.  See Stip. of
Uncontested Facts (Dkt. 96) ¶ 23; see also JPMC SUF ¶ 32.  On that 1:19 p.m. ET call, Hariri
and Gonzales confirmed that Blue Flame was the intended beneficiary of the wire.  See Dkt. 113-
10, Evinger Dep. 252:10-19; see also JPMC SUF ¶ 33.  Also on that 1:19 p.m. ET call, Evinger

2
Chain Bridge asserts that this phone call took place at 1:35 p.m. ET.  The parties’
Stipulation of Uncontested Facts, however, states that the call took place at 1:34 p.m. ET.  See
Stip. of Uncontested Facts ¶ 24.
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shared information about Blue Flame with the STO, including that the account had been opened
the day before the wire and that the client who opened the account was a political lobbyist.  See
Dkt. 113-22, Gonzales Dep. 49:21-50:6; Dkt. 113-30, CBB00004453 at 4466; see also JPMC
SUF ¶ 34.  Finally, also on that 1:19 p.m. ET call, Chain Bridge offered to return the funds—
stating to California that it “would be happy to return the wire.”  Dkt. 113-30, CBB00004453 at
4466; see also Dkt. 113-10, Evinger Dep. 255:18-20; JPMC SUF ¶ 35.  According to Evinger,
California responded that “they did not want [Chain Bridge] to return the money at that stage.”
Dkt. 113-10, Evinger Dep. 255:20-21; see also JPMC SUF ¶ 35.
As for the 1:34 p.m. ET call between the banks, Chain Bridge obscures the initiation of
that communication by stating that “Korpal spoke again with Brough and Evinger”—in fact, it
was Brough and Evinger who called Korpal to ask if there was “any way for JPMorgan to issue a
recall.”  Dkt. 113-31, CBB00002544 at 0:04-0:09; Stip. of Uncontested Facts ¶ 24; see also
JPMC SUF ¶¶ 36-37.
10.
Disputed:  This statement is incomplete because it omits context for reversal-
related communications within JPMC as well as between JPMC and Chain Bridge.  As Korpal
and Coffey explained at their depositions, Korpal, as a supervisor at JPMC, made the decision to
agree to Chain Bridge’s reversal request and Coffey, as a subordinate, simply executed Korpal’s
instruction.  See Dkt. 113-25, Coffey Dep. 125:14-21 (testifying that Korpal did not explain why
JPMC would be recalling the funds and that “the only information [Coffey] had was a
direction”); Ex. 1, Coffey Dep. 126:12-14 (“I was not privy to any of the conversations that
drove the decision for the funds to be returned.”).  Chain Bridge’s statement, by only quoting
Coffey’s comments on the phone call with Chain Bridge, omits the material fact expressed in
Korpal’s testimony:  “There was not a need for JP Morgan Chase to call the funds back …
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[because they] were being held by Chain Bridge Bank.”  Ex. 2, Korpal Dep. 256:9-15; see also
id. 257:21-22.  Korpal testified that, had Chain Bridge not requested the recall, JPMC “would not
have issued the recall request” because Chain Bridge “said they were holding the funds.”  Dkt.
113-14, Korpal Dep. 284:22-285:1.

11.
Undisputed.
12.
Disputed:  This statement is incomplete to the extent it purports to describe the
“meaning” of JPMC’s reversal message’s text.  As Coffey testified, the message looked to be
“one of the templates” that JPMC uses, as opposed to a “freeform message.”  Ex. 1, Coffey Dep.
142:16-21.
13.
Disputed:  This statement is incomplete in saying that “California’s State
Treasurer’s Office also called Chain Bridge to follow up on the recall” because that fails to
capture the full context of relevant communications.  Between 2:04 p.m. ET and 2:34 p.m. ET,
the STO called Chain Bridge twice—once connecting with Evinger and once leaving a
voicemail—and Chain Bridge called the STO once (in response to the voicemail).  See Dkt. 113-
19, CBB00004323 at 4333-4335; Dkt. 113-20, CBB First Interrogatory Responses at 5.
14.
Disputed:  The statement that Chain Bridge “honored” JPMorgan’s reversal
request is inaccurate.  The request for reversal was made by Chain Bridge, not JPMC, during the
1:34 p.m. ET call when Evinger asked Korpal if there was “any way for JPMorgan to issue a
recall for the wire.”  Dkt. 113-31, CBB00002544 at 0:04-0:09; see also Stip. of Uncontested
Facts ¶ 24; JPMC SUF ¶ 37.  JPMC in turn agreed to Chain Bridge’s reversal request when
JPMC sent the 2:05 p.m. ET Fedwire reversal message, in compliance with Chain Bridge’s
instructions.  See Dkt. 113-32, CBB00002545 at 0:06-0:18, 0:18-0:27 (1:37 p.m. ET call on
which JPMC asked, “What are you looking for from us?” and Chain Bridge responded that it
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would “like official communication from JPMorgan to us to recall the funds,” specifically a
message sent “over the Fedline platform”).
15.
Disputed:  This statement is incomplete because it omits California’s recognition
of the distinct role that Chain Bridge played in returning the wire.  For example, California State
Treasurer Fiona Ma recognized publicly that the “two banks involved in the wire transfer
contacted her office because they had suspicions.”  Ex. 3, Rosenhall, CA lawmakers told half-
billion dollar Blue Flame mask deal thwarted by suspicious bankers, CalMatters (May 11, 2020;
updated Sept. 17, 2020); id. (crediting one bank, Chain Bridge, with providing California the
information that “the recipient was a Washington, D.C.[] lobbyist who had only opened a bank
account the day before”); see also id. (attributing to Mark Ghilarudcci, director of the Governor’s
Office of Emergency Services, the comment that “banks involved in the large wire transfer
called state officials and alerted them that the transaction seemed suspicious”).
ARGUMENT
I.
CHAIN BRIDGE’S INDEMNIFICATION CLAIM FAILS
As JPMC explained in its summary judgment motion (at 13-26), Chain Bridge’s
indemnification claim fails for three independent reasons.  Far from helping its cause, Chain
Bridge’s motion underscores each problem JPMC identified.
A.
Indemnification Under U.C.C. § 4A-211(f) Is Inapplicable Because Chain
Bridge Requested And Directed The Cancellation
Under § 4A-211(f), indemnification applies only where there is first a “cancellation … by
the sender,” and then, “the receiving bank … agrees to” that “cancellation.”  Thus, as JPMC has
explained (JPMC MSJ 14-16), indemnification only applies where the cancellation is instigated
by the sender:  an affirmative request “by the sender” to which the “receiving bank” then
“agrees.”  U.C.C. § 4A-211(f).  That interpretation accords with the purpose of indemnification,
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and the one case Chain Bridge cited to counter this proposition is inapposite (see infra p.13).
With its roots in equity, indemnification ensures that the responsible party—the party whose
actual fault caused the injury—bears the burden of any resulting loss.  See, e.g., White v. Johns-
Manville Corp., 662 F.2d 243, 249-250 (4th Cir. 1981); 42 C.J.S. Indemnity § 2.
There is no § 4A-211(f) indemnification claim if the receiving bank requests or otherwise
directs the cancellation.  That is the case here.  As a mountain of record evidence reveals, Chain
Bridge requested and directed the cancellation.
1.
Chain Bridge’s legal argument is incorrect
Chain Bridge’s principal response (CB MSJ 13-23) is a legal argument by which the bank
seeks to avoid virtually everything that happened on March 25 and 26, 2020.  According to
Chain Bridge, it does not matter that its President expressly requested that JPMC “issue a recall
for the wire” (id. 17 (quoting Dkt. 130-63)).  Nor does it matter that Chain Bridge “had reasons
of its own” (id. 18) for doing so.  Indeed, by Chain Bridge’s telling, none of its actions or reasons
for the reversal matters.  The only facts that matter begin after Chain Bridge’s President and
CEO called JPMC because, to Chain Bridge, the sole thing that matters is that JPMC sent the
requested reversal message over Fedwire and Chain Bridge sent the funds back.
Chain Bridge’s formalistic argument—that it could not have effected the cancellation
because Article 4A precludes receiving banks from doing so—is irrelevant and wrong.  The
question here is about the statutory elements of indemnification under § 4A-211(f), not whether
and how a receiving bank can cancel a wire.  Under the statute, indemnification only applies if
the sender cancels a payment order and “the receiving bank” then “agrees.”  U.C.C. § 4A-211(f).
If the situation is the reverse—i.e., the receiving bank requests or directs a cancellation—then
indemnification does not apply.
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In any event, Article 4A recognizes that receiving banks, just like senders, can effect
cancellations.  For example, § 4A-210, the immediately preceding provision, provides for the
“rejection” of a payment order “by the receiving bank.”  A rejection is just another form of
cancellation, both of which result in the reversal of the wire.  See U.C.C. §§ 4A-210, 211.
Article 4A elsewhere identifies the “functions of [a] receiving bank” as “receipt, processing, and
transmittal of payment orders, cancellations and amendments,” U.C.C. § 4A-105 cmt. 2
(emphasis added), and also speaks to a receiving bank’s “processing of payment orders and
communications cancelling or amending payment orders,” id. § 106 (emphasis added).  Thus,
whether termed a “cancellation,” “rejection,” or something else, a receiving bank clearly can
seek and obtain a wire’s reversal under Article 4A—as Chain Bridge did here.
Chain Bridge insists (CB MSJ 19) that JPMC’s interpretation of § 4A-211(f) would
“preclude indemnification in every case governed by Section 4A-211(f)” because a receiving
bank will “presumably ha[ve] good reasons” for acting.  But “good reasons” and “[b]eliev[ing]
cancellation to be appropriate” (CB MSJ 19) are a far cry from a bank seeking and obtaining a
cancellation, as here, for its own self-interest.  JPMC’s rule would only bar indemnification in
that latter circumstance, which follows from the text of § 4A-211(f) and is consistent with
fundamental principles of indemnification.  As JPMC has explained (JPMC MSJ 15-16),
indemnification is meant to allow an indemnitee whose liability is merely “technical, passive or
secondary” to “shift[]” “the burden for the entire loss … to the indemnitor whose actual fault
caused the injury.”  White, 662 F.2d at 249-250.  By contrast, where, as here, an aspiring
indemnitee “active[ly]” caused the injury, “an essential predicate to [the indemnitee’s] right to
indemnification is necessarily missing.”  Id. at 250; see also, e.g., United States v. Seckinger, 397
U.S. 203, 210-211 (1970); Horton v. United States, 622 F.2d 80, 82 (4th Cir. 1980).
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The principal case on which Chain Bridge relies, Banca Commercial Italiana v. Northern
Trust International Banking Corp., 160 F.3d 90 (2d Cir. 1998), provides it no help.  Chain
Bridge repeatedly emphasizes Banca’s use of the phrase “‘absolute liability’” (CB MSJ 2, 5, 20,
22 (quoting 160 F.3d at 94)), but that liability only attaches if the statutory predicates are met.
There was no question in Banca about which party sought the cancellation—the sender.  Banca’s
statement is therefore unremarkable and irrelevant.  It simply reflects the operation of the statute
when its predicate condition is met (and there is no agreement to the contrary)—“the sender
cancels a payment order.”  160 F.3d at 94.  Similarly, Banca’s mention of a “‘depart[ure] from
the common law’” (CB MSJ 5, 20 (quoting 160 F.3d at 94) (alteration in original)) refers to the
point that indemnification under § 4A-211(f) does not turn on a “showing of wrongfulness on the
part of the sender,” 160 F.3d at 94 (emphasis added).  That too is unremarkable and irrelevant.
Banca says nothing about the applicability of indemnification under § 4A-211(f) to cases like
this one—where the receiving bank requests and directs the reversal of the funds.  Nor does
Banca suggest that § 4A-211(f) was meant to depart from common law to entitle an indemnitee
who actively caused an injury to nonetheless obtain indemnification.
2.
The facts do not support Chain Bridge’s indemnification claim
Chain Bridge relies on JPMC’s reversal message as the sole factual support for its
argument that JPMC canceled the wire.  See, e.g., CB MSJ 13-14.  But as JPMC has explained
(JPMC MSJ 17), that message does not constitute a cancellation by JPMC and could not alter the
legal significance of Chain Bridge’s original cancellation request.  It is undisputed that Chain
Bridge asked JPMC “to issue a recall for the wire.”  JPMC SUF ¶ 37 (quoting Dkt. 113-31,
CBB00002544 at 0:04-0:09); CB SUF ¶ 9 (quoting Dkt. 130-63).  That oral request constitutes a
cancellation request under Article 4A.  See U.C.C. § 4A-211(a); see also id. § 4A-210(a).
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JPMC’s responsive reversal message was therefore an “accommodation,” id. § 4A-211(f) cmt. 5,
to Chain Bridge’s request.
It bears emphasis that Chain Bridge specifically sought the reversal message in the first
place—even specifying the form in which it desired the reversal to take place, asking JPMC to
“send it over the Fedline platform.”  Dkt. 113-32, CBB000002545 at 0:18-0:27; see also JPMC
SUF ¶ 43.  As the record reflects, there was good reason for requesting that formality.  Reversal
messages operate “to reverse the accounting entries effected to accounts at the Federal Reserve.”
Ex. 4, Baxter Rep. ¶ 46.  Thus, JPMC’s reversal message “not only tied the reversal to the
original Wire Transfer,” an “important” “housekeeping and accounting matter,” but also
eliminated the potential for human error in returning the funds to California.  Id.  Chain Bridge’s
CEO admitted as much, testifying that the requested reversal message was the “neater and tidier”
form of returning the funds to California.  Ex. 5, Brough Dep. 296:18-20.
Finally, in all events, Chain Bridge’s indemnification claim fails because its actions and
motivations to return the wire make clear that Chain Bridge directed the cancellation at every
material turn.  As JPMC previously detailed (JPMC MSJ 18-21):

The day before receiving the wire, top Chain Bridge executives called the wire a
“scam” (Dkt. 113-5, CBB00000761 at 761; Dkt. 113-7, CBB00002798 at 8:23-8:49;
Dkt. 113-10, Evinger Dep. 205:21-206:8; Dkt. 113-9, Grice BSA/AML Rep. ¶ 75;
see also JPMC SUF ¶ 7) and engaged the bank’s BSA team (Dkt. 113-7,
CBB00002798 at 11:51-11:54; see also JPMC SUF ¶ 6) because they were
suspicious of Blue Flame.  See also JPMC SUF ¶¶ 1-5.

Upon receipt of the wire and before ever speaking to JPMC, Chain Bridge
immediately placed the funds on hold (Dkt. 113-17, CBB00000728 at 728; see also
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JPMC SUF ¶¶ 15-16), and then repeatedly called California to raise concerns about
Blue Flame and the legitimacy of the transaction (Dkt. 113-19, CBB00004323 at
4333-4335; see also JPMC SUF ¶¶ 17-20).

Chain Bridge then raised the reversal of the funds transfer—twice:  first with
California, saying that it would be “happy to return the wire” (Dkt. 113-30,
CBB00004453 at 4466; see also JPMC SUF ¶ 35)—and then, after California said it
“did not want [Chain Bridge] to return the money at that stage” (Dkt. 113-10,
Evinger Dep. 255:20-21; see also JPMC SUF ¶ 35), with JPMC (Dkt. 113-31,
CBB00002544 at 0:04-0:09; see also JPMC SUF ¶ 37).

Chain Bridge worried that a wire that “massive” could pose “problems on [its]
capital ratios” (Dkt. 113-3, CBB00000661 at 670; see also JPMC SUF ¶ 2) and so
Chain Bridge had to get the wire off its books quickly (Dkt. 113-7, CBB00002798 at
3:07-3:12; Dkt. 113-6, CBB00002797 at 2:26-2:30; Dkt. 113-5, CBB00000761 at
761; Dkt. 113-3, CBB00000661 at 662, 667; see also JPMC SUF ¶ 4).

Chain Bridge worried the wire would run afoul of its obligations under the BSA and
AML rules and regulations.  Dkt. 113-8, Brough Dep. 72:16-22, 200:4-6, 207:6-9;
see also JPMC SUF ¶ 5.

Finally, and critically, Chain Bridge’s own wire transfer policy for incoming wires
required it to return the wire to California.  Dkt. 113-11, CBB00004294 at 4298;
Dkt. 113-8, Brough Dep. 199:8-21; see also JPMC SUF ¶¶ 8-9.
Against these undisputed facts, the most Chain Bridge can do is point to JPMC’s formal
administrative claim against California.  In the procedural-history section of its brief (CB MSJ
11-12), Chain Bridge trumpets the claim as though it might provide some support for its theory.
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But then Chain Bridge ignores the point in its argument, but for a cursory reference in a footnote
(CB MSJ 18 n.5).  For good reason—it is a red herring.  There is no question that California did
not want to go forward with a transaction with Blue Flame.  But the indemnification issue here
concerns the interactions and relationship between JPMC and Chain Bridge—not California.
And on this evidentiary record, the facts show that JPMC was comfortable with Chain Bridge
holding the funds (as it was and planned to continue doing), and that JPMC would not have sent
a reversal message were it not for Chain Bridge’s express request.  Dkt. 113-14, Korpal Dep.
23:6-9; see also JPMC SUF ¶ 45.
In sum, the undisputed facts show that Chain Bridge took independent and unilateral
actions to ensure that the wire was reversed and that such actions were motivated by powerful
incentives—all of which reaffirm that Chain Bridge was acting with the deliberate intent of
reversing the wire.  Chain Bridge’s claim for indemnification therefore must fail.3
B.
The Parties’ Agreement Did Not Include Any Obligation By JPMC To
Indemnify Chain Bridge
Even if § 4A-211(f) was applicable (it is not), Chain Bridge agrees that an “agreement”
between the parties would override any indemnification obligation.  Chain Bridge asserts that no
such agreement exists (CB MSJ 15-16, 21), but the record shows otherwise.  As JPMC has
explained (JPMC MSJ 21-24), the bankers’ communications and course of conduct show that
JPMC and Chain Bridge reached an agreement that did not include any express or implied
promise to indemnify.

3
Even if the record reflected a joint decision by Chain Bridge and JPMC to reverse the
wire (it does not), indemnification still would not apply.  See JPMC MSJ 21 n.4.  Chain Bridge’s
suggestion (CB MSJ 20) that “every cancelled wire after acceptance by the beneficiary’s bank
requires a ‘joint’ decision” ignores the statutory text and purpose of indemnification.  A mutual
decision reached evenly by two banks is plainly different from what the statute requires for
indemnification—a cancellation instigated by the sending bank.
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As relevant here, an “agreement” is a defined term under the U.C.C. meaning “the
bargain of the parties in fact,” as “distinguished from ‘contract.’”  U.C.C. § 1-201(b)(3).  Such an
agreement can be found in the parties’ “language or inferred from other circumstances, including
course of performance, course of dealing, or usage of trade.”  Id.; see JPMC MSJ 21.  Chain
Bridge’s actions and substantive concerns about the wire made clear to JPMC that it wanted to
return the funds for its own reasons, and that indemnity, never raised by Chain Bridge, was not
part of the bargain.  So when Chain Bridge called JPMC to request a reversal, JPMC agreed to
do just that—as it was evident that indemnification was not needed or appropriate to effectuate
the reversal.
An internal Chain Bridge call—which Chain Bridge never mentions—further confirms
the terms of the parties’ agreement.  Consistent with the parties’ understanding, Chain Bridge’s
President and CEO disclaimed the need for JPMC to indemnify Chain Bridge.  When an
employee asked if Chain Bridge “[was] getting an indemnity letter from Chase,” the President
and CEO unequivocally stated:  “Just return [the wire] to the same place it came from.”  Dkt.
113-24, CBB00002789 at 1:18-1:25, 1:37-1:42; see also JPMC SUF ¶¶ 51-52.  This
contemporaneous phone call alone supports a reasonable inference that the parties’ agreement
did not include an indemnity obligation.  See, e.g., Dataflow, Inc. v. Peerless Ins. Co., 2014 WL
148685, at *4 (N.D.N.Y. Jan. 13, 2014) (“[A party’s] internal communications evincing its
interpretation of … [an] agreement are relevant to … [the] interpretation” of that agreement.).
Ignoring that call, Chain Bridge argues (CB MSJ 15, 21) that the agreement was not
express—i.e., that the parties never executed a writing, or never expressly mentioned the word
“indemnity” in their discussions.  But that does not matter.  Article 4A specifically uses the term
“agreement,” and the U.C.C. provides that the parties’ communications and course of dealings
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can amount to an “agreement” between them—it need not be express, but rather can be
“inferred.”  U.C.C. § 1-201(b)(3).
Chain Bridge’s reliance (CB MSJ 15) on the absence of the words “‘No Indemnity’” in
JPMC’s reversal message fails for similar reasons.  As JPMC explained (JPMC MSJ 17 n.3), this
text operates only as a potential disclaimer; it does not impose any liability.  And it is only one
way, but not the only way, to avoid liability that would otherwise exist.  Chain Bridge agrees; it
goes only so far as to claim this text would be “customary” (CB MSJ 15), but not required to
avoid liability.  Moreover, Chain Bridge’s own conduct reaffirms the irrelevance of the “No
Indemnity” language here.  The Court need only look at the internal Chain Bridge call during
which Chain Bridge’s highest executives—before even knowing whether the Fedwire reversal
message would state “No Indemnity”—disclaimed the need for indemnification by JPMC, and
instead gave their employees a clear and unequivocal instruction to return the wire.
C.
Chain Bridge Cannot Establish Causation
Chain Bridge agrees (CB MSJ 21-22) that to obtain indemnification it must prove that
JPMC’s conduct was the cause of Blue Flame’s damages—if any—on its statutory claims.4  But
Chain Bridge then ignores the facts in the record that show that it intended to return the wire
regardless of JPMC’s actions, fatally undermining its causation argument.  See JPMC MSJ 25-
26.
For example, Chain Bridge contacted California and proposed returning the funds—
saying it would be “happy to return the wire”—before ever even discussing the matter with
JPMC.  Dkt. 113-30, CBB00004453 at 4466; see also Dkt. 113-10, Evinger Dep. 255:18-20;
JPMC SUF ¶¶ 35-39.  Moreover, Chain Bridge’s wire transfer policy required the return of

4
Chain Bridge cannot recover for Blue Flame’s non-statutory claims, i.e., the two tortious
interference claims and the defamation claim.
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funds (see Dkt. 113-11, CBB00004294 at 4298; Dkt. 113-5, CBB00000761 at 761; see also
JPMC SUF ¶¶ 7-8), and Chain Bridge’s CEO testified that the bank would not make an
exception to its own internal policies for a $456 million wire (see Dkt. 113-8, Brough Dep.
199:8-21; see also JPMC SUF ¶ 9).  Attempting to downplay the policy, Chain Bridge insists the
“record is clear” that it required “an official cancellation message from JPMorgan prior to
returning any funds.”  CB MSJ 22 n.6.  That claim lacks any evidentiary support—Chain Bridge
cites nothing for it—and is certainly not a permissible inference at this summary judgment stage.
The policy does not mention Fedwire reversal messages, much less make the applicability of the
policy contingent upon Chain Bridge obtaining any such messages.
Moreover, the record is replete with evidence showing that Chain Bridge intended to
return the wire because it was concerned that making the funds available to Blue Flame would
run afoul of the BSA.  See Dkt. 113-8, Brough Dep. 72:16-22, 200:4-6, 207:6-9; Dkt. 113-7,
CBB00002798 at 11:51-11:54; see also Dkt. 113-9, Grice BSA/AML Rep. ¶¶ 57, 75, 105; JPMC
SUF ¶¶ 5-6.  Finally, Chain Bridge closed Blue Flame’s accounts and severed all ties with its
client on the same day it returned the wire.  See Stip. of Uncontested Facts ¶¶ 31, 33; Dkt. 113-
36, CBB00000748; Dkt 113-37, CBB00000594; see also JPMC SUF ¶¶ 53-59.
Chain Bridge cannot establish causation even if there were doubt about Chain Bridge’s
intent to return the wire regardless of any actions by JPMC (and there is none).  Chain Bridge
assumes (CB MSJ 21-22) that the causation element turns on whether Chain Bridge would have
returned the wire in the absence of the Fedwire reversal message.  But that is wrong.  If Blue
Flame suffered damages, it did so because it was deprived of the funds that it allegedly needed to
secure personal protective equipment.  Thus, Chain Bridge’s admission that it placed a hold on
the wire immediately upon arrival, and that it was “almost sure [it] would have held the funds”
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had it “not received the request to return the wire” (Dkt. 113-8, Brough Dep. 223:4-6; see also
JPMC SUF ¶ 46) shows that Blue Flame’s damages would have followed even in the absence of
JPMC’s purported cancellation.  That Chain Bridge supposedly might not have held the funds “in
perpetuity” (CB MSJ 21) is of no help to Chain Bridge.  Regardless of JPMC’s actions, the
record is clear that Blue Flame would have been unable to wire out the funds on March 26, as it
claims it intended.  Ex. 6, CBB00001385.  Thus, the “loss and expenses” for which Chain Bridge
seeks indemnification are not “a result of the cancellation.”  U.C.C. § 4A-211(f).
Assuming indemnification applies (it does not), Chain Bridge is only entitled to recover
for any “loss and expenses” caused by JPMC’s conduct—not any “loss and expenses” that would
have resulted for independent reasons.  The record here supports JPMC, not Chain Bridge.  But
at minimum, Chain Bridge has failed to carry its burden on this element, precluding summary
judgment in its favor.
II.
CHAIN BRIDGE’S UNJUST-ENRICHMENT CLAIM FAILS, AND ITS NEWLY ASSERTED
PAYMENT-BY-MISTAKE CLAIM IS IMPROPER AND MERITLESS
Chain Bridge’s unjust-enrichment claim fails because the bank cannot establish any of
the three required elements.  See JPMC MSJ 26-28.  Chain Bridge does not even attempt to
argue otherwise, instead choosing to ignore these elements altogether.  Sensibly so.  First, Chain
Bridge conferred no benefit on JPMC.  The funds at issue were California’s, not JPMC’s, and
JPMC returned them in in full.  See Dkt. 113-43, JPMC-00000170 at 0174; JPMC SUF ¶ 62;
Anderson v. Fluor Intercontinental, Inc., 2021 WL 837335, at *15 (E.D. Va. Jan. 4, 2021)
(granting summary judgment because defendant “lack[ed] any entitlement” to the financial
benefit allegedly conferred).  Second, the record is devoid of evidence that JPMC understood
Chain Bridge to be conferring a benefit upon it.  See Integrated Direct Mktg., LLC v. May, 129 F.
Supp. 3d 336, 374 (E.D. Va. 2015) (Brinkema, J.) (granting summary judgment where plaintiff
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had “not provided sufficient evidence from which a reasonable jury could find that [defendants]
knowingly used any trade secret or confidential … information to benefit themselves”), aff’d,
690 F. App’x 822 (4th Cir. 2017).  Third, since Chain Bridge sought the cancellation and JPMC
did not retain any benefit, there is no inequity to rectify.5
Recognizing its unjust-enrichment claim is dead on arrival, Chain Bridge seeks to assert a
new claim, payment by mistake, for the first time.  See United States v. Ndutime Youth & Family
Servs., 2020 WL 5507217, at *18 (E.D. Va. Sept. 11, 2020) (treating payment by mistake and
unjust enrichment as separate claims, with distinct legal standards).  But Chain Bridge cannot
“constructively amend [its] complaint” via summary judgment briefing.  Harris v. Reston Hosp.
Ctr., LLC, 523 F. App’x 938, 946 (4th Cir. 2013); see also, e.g., Orbit Corp. v. FedEx Ground
Package Sys., Inc., 2016 WL 6609184, at *19 (E.D. Va. Nov. 8, 2016).  Thus, the Court should
not entertain Chain Bridge’s newly concocted claim.
The payment-by-mistake claim also fails for multiple reasons.  Chain Bridge’s purported
mistake—that Blue Flame “had a right to payment of the wire transfer” and that “cancellation
was unlawful” (CB MSJ 23-24)—is, if anything, a mistake of law, not of fact.  So Chain
Bridge’s claim sinks at the start.  See Aetna Cas. & Sur. Co. v. Maryland Cas. Co., 18 Va. Cir.
162, 163 (Va. Cir. Ct. 1989) (“If a mistake in law, there can be no recovery” on a payment-by-
mistake claim.); see also Newton v. Newton, 118 S.E.2d 656, 659 (Va. 1961).  Moreover, the
claim is barred by the doctrine of changed circumstances, whereby such a claim fails if a party

5
Chain Bridge passingly refers to JPMC’s “accept[ance of] its happy customer’s effusive
praise” (CB MSJ 24).  Even if such praise could constitute a benefit, let alone one that JPMC
could disgorge—and neither is the case—it is irrelevant to Chain Bridge’s claim because it came
from California, not Chain Bridge.  See Hair Club for Men, LLC v. Ehson, 2016 WL 3636851, at
*7 (E.D. Va. May 6, 2016) (denying preliminary injunction for unjust enrichment where plaintiff
failed to assert it directly conferred benefit on defendant).
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(1) receives the funds at issue through no fault of its own; (2) changes its position before
knowledge of any mistake; and (3) no longer has recourse to the payment.  See Liberty Mut. v.
Williams Int’l Indus., Inc., 780 F. Supp. 359, 363 (E.D. Va. 1991).  That is the case here:  As
discussed, Chain Bridge, not JPMC, directed the wire’s reversal and was motivated to do so for
reasons independent from JPMC.  JPMC then promptly returned the funds to California—
retaining nothing—and it did so long before receiving notice of the purported mistake, asserted
for the first time over a year later in Chain Bridge’s summary judgment brief.
III.
JPMC’S AFFIRMATIVE DEFENSE OF EQUITABLE ESTOPPEL PRECLUDES SUMMARY
JUDGMENT FOR CHAIN BRIDGE
There is a final, independent reason to deny Chain Bridge’s motion:  Chain Bridge failed
to address, let alone refute, JPMC’s affirmative defense of equitable estoppel, which would bar
Chain Bridge’s recovery.
In its answer, JPMC asserted the affirmative defense of equitable estoppel.  Dkt. 64 at 7-8
(Sixth Defense).  In response to interrogatories requesting that JPMC elaborate the legal and
factual basis for its defense against Chain Bridge’s indemnification claim, JPMC again identified
equitable estoppel as a specific reason why it is not liable to Chain Bridge.  See Burke Decl., Ex.
97 (Dkt. 131-32) at 10.  Moreover, specifying the basis for this defense, JPMC explained that
Chain Bridge led JPMC to believe that indemnification was inapplicable, and that, unlike JPMC,
Chain Bridge benefited from the wire’s reversal.  Id.
Chain Bridge repeatedly invokes JPMC’s interrogatory responses in its opening brief (CB
MSJ 16, 18, 20, 21, 22), but it nowhere—not once—addresses this defense.  “[A] claimant’s
right to summary judgment,” however, “depends upon the nonviability of [an affirmative]
defense in addition to the viability of the claimant’s claim.”  49 C.J.S. Judgments § 304.  “Thus,
to be entitled to summary judgment, a plaintiff must conclusively refute a defendant’s well-pled
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affirmative defenses.”  Id.; see, e.g., Veolia Es Special Servs., Inc. v. Techsol Chem. Co., 2008
WL 11380183, at *4 (S.D. W.Va. Oct. 14, 2008) (summary judgment movant “must convince
the Court” that non-movant’s “affirmative defense [is] inapplicable”).  Chain Bridge has
defaulted entirely on its burden at this summary judgment stage.  See, e.g., Hamed v. Saul, 432 F.
Supp. 3d 610, 613 (E.D. Va. 2020) (rejecting argument raised in reply to motion for summary
judgment as “procedurally waived”; “[t]he Fourth Circuit has made clear that ordinarily it is
improper to consider arguments raised for the first time in a reply brief”).
As the Court has explained, “[e]quitable estoppel protects parties who rely in good faith
upon the statements or actions, or even inaction, of another party by prohibiting the other party
from benefitting by changing its position to contradict its earlier position or otherwise injure the
relying party.”  Newcom Holdings Pty., Ltd. v. Imbros Corp., 369 F. Supp. 2d 700, 714 (E.D. Va.
2005) (Brinkema, J.).  Thus, the elements of equitable estoppel are “(1) a representation,
(2) reliance, (3) a change in position and (4) some detriment accruing to the relying party.”  Id.
For the reasons already explained to Chain Bridge, which Chain Bridge in turn ignored, the facts
support equitable estoppel here.  Through clear statements and actions, Chain Bridge led JPMC
to believe that it wanted the wire reversed for its own reasons—period.  Indemnification was not
part of the equation.  JPMC in turn relied on those statements and actions in agreeing to Chain
Bridge’s request, to JPMC’s detriment and Chain Bridge’s multiple benefits.6  Equity should not
now permit Chain Bridge to recover from JPMC for doing the very thing that Chain Bridge

6
Moreover, there is a material question whether Chain Bridge’s representations to JPMC,
as part of the parties’ discussion concerning the return of the wire, were accurate.  As explained
(supra p.6), Chain Bridge made clear to JPMC that it had not credited Blue Flame’s account, but
Chain Bridge stated internally that it “had credited the customer’s account” (Dkt. 113-24,
CBB00002789 at 2:23-2:27).  And that representation was material:  JPMC relied on it when
agreeing to Chain Bridge’s reversal request and issuing the corresponding Fedwire message.  See
Ex. 2, Korpal Dep. 39:13-17, 40:6-9.
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asked it to do.  Accordingly, Chain Bridge’s motion should be denied.  See, e.g., Branch Banking
& Tr. v. Witmeyer, 2011 WL 3297682, at *7 (E.D. Va. Jan. 6, 2011) (holding at summary
judgment on U.C.C. claims that the “evidence could sustain the affirmative defense of equitable
estoppel”).
CONCLUSION
The Court should deny Chain Bridge’s motion for summary judgment and, for the
reasons stated in JPMC’s summary judgment motion, the Court should grant summary judgment
to JPMC on all claims in Chain Bridge’s third-party complaint.

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Dated:  May 20, 2021
Respectfully submitted,
WILMER CUTLER PICKERING HALE
AND DORR LLP
/s/ Meredith K. Loretta

Meredith K. Loretta (92369)
Albinas J. Prizgintas (pro hac vice)
Whitney Russell (pro hac vice)
1875 Pennsylvania Avenue N.W.
Washington, DC  20006
Tel.: (202) 663-6981
Fax: (202) 663-6363
meredith.loretta@wilmerhale.com

Alan E. Schoenfeld (pro hac vice)
Marissa W. Medine (pro hac vice)
7 World Trade Center
250 Greenwich Street
New York, NY  10007
Tel.: (212) 230-8800
Fax: (212) 230-8888
alan.schoenfeld@wilmerhale.com

Felicia Ellsworth (pro hac vice)
60 State Street
Boston, MA  02109
Tel.: (617) 526-6000
Fax: (617) 526-5000
felicia.ellsworth@wilmerhale.com

Margarita M. Botero (pro hac vice)
1225 17th Street, Suite 2600
Denver, CO  80202
Tel.: (720) 274-3135
Fax: (720) 274-3133
margarita.botero@wilmerhale.com

Attorneys for Third-Party Defendant
JPMorgan Chase Bank, N.A.

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CERTIFICATE OF SERVICE

I certify that on this 20th day of May, 2021, I electronically filed the foregoing using the
Court’s CM/ECF system, which will then send a notification of such filing to all counsel of
record.
/s/ Meredith K. Loretta

Meredith K. Loretta
1875 Pennsylvania Avenue N.W.
Washington, DC  20006
Tel.: (202) 663-6981
Fax: (202) 663-6363
meredith.loretta@wilmerhale.com

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