226 A.D.3d 60
N.Y. App. Div.2024Background
- This case arises out of the 2016 cyber-theft of $81 million from Bangladesh Bank's account at the Federal Reserve Bank of New York, which was then laundered through Rizal Commercial Banking Corp. (RCBC) accounts in the Philippines.
- The alleged scheme involved North Korean hackers, RCBC employees, and other Philippine nationals creating fictitious bank accounts and moving funds through New York and Philadelphia correspondent accounts held by RCBC.
- Litigation was initiated by Bangladesh Bank against RCBC and several individuals and entities in New York Supreme Court, after federal litigation was dismissed on procedural grounds.
- Defendants moved to dismiss on several grounds, including lack of personal jurisdiction, forum non conveniens, and failure to state a claim.
- The lower court denied most dismissal motions but dismissed some claims against certain defendants; the Appellate Division further modified this, dismissing claims against some individuals for lack of jurisdiction and dismissing conversion-related causes of action.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Forum non conveniens (should NY hear case?) | NY is proper due to theft’s connection to NY Fed | Philippines is proper; key events/actors not in NY | Court had discretion; NY is appropriate forum |
| Personal jurisdiction over RCBC & Tans | Sufficient minimum contacts via NY correspondent accts | Not sufficient; did not transact business in NY | Jurisdiction exists over RCBC & Tans |
| Personal jurisdiction over individual defendants (Reyes, Pineda, Capina, Agarrado) | Conspiracy/long-arm jurisdiction applies | No control, benefit, or sufficient connection to NY | No personal jurisdiction; claims dismissed against them |
| Sufficiency of conversion claim | Funds traceable, conversion is viable | Funds commingled/not identifiable, conversion fails | Conversion claims dismissed; funds not specifically identifiable |
Key Cases Cited
- OrthoTec, LLC v. Healthpoint Capital, LLC, 84 AD3d 702 (significance of plaintiff’s choice of forum under NY law)
- Islamic Republic of Iran v. Pahlavi, 62 NY2d 474 (factors for forum non conveniens in NY)
- Kreutter v. McFadden Oil Corp., 71 NY2d 460 (agency and purposeful availment in NY jurisdiction)
- Deutsche Bank Sec., Inc. v. Montana Bd. of Invs., 7 NY3d 65 (test for transacting business under CPLR 302(a)(1))
- Licci v. Lebanese Canadian Bank, SAL, 20 NY3d 327 (jurisdiction via NY correspondent bank accounts)
- Thys v. Fortis Sec. LLC, 74 AD3d 546 (identifiability of funds needed for a conversion claim)