N.Y. Uniform Commercial Code Law § 8-404: Wrongful Registration

Section 8--404. Wrongful Registration.

(a) Except as otherwise provided in Section 8--406, an issuer is

liable for wrongful registration of transfer if the issuer has

registered a transfer of a security to a person not entitled to it, and

the transfer was registered:

(1) pursuant to an ineffective indorsement or instruction;

(2) after a demand that the issuer not register transfer became

effective under Section 8--403(a) and the issuer did not

comply with Section 8--403(b);

(3) after the issuer had been served with an injunction,

restraining order, or other legal process enjoining it from

registering the transfer, issued by a court of competent

jurisdiction, and the issuer had a reasonable opportunity to

act on the injunction, restraining order, or other legal

process; or

(4) by an issuer acting in collusion with the wrongdoer.

(b) An issuer that is liable for wrongful registration of transfer

under subsection (a) on demand shall provide the person entitled to the

security with a like certificated or uncertificated security, and any

payments or distributions that the person did not receive as a result of

the wrongful registration. If an overissue would result, the issuer's

liability to provide the person with a like security is governed by

Section 8--210.

(c) Except as otherwise provided in subsection (a) or in a law

relating to the collection of taxes, an issuer is not liable to an owner

or other person suffering loss as a result of the registration of a

transfer of a security if registration was made pursuant to an effective

indorsement or instruction.