560 F. App'x 52
2d Cir.2014Background
- Appellants Universal Trading & Investment Co., Inc. and Foundation Honesty International sued Credit Suisse entities and several employees, alleging they helped two corrupt Ukrainian officials hide assets owed to appellants under a default judgment.
- The complaint asserted nine causes of action alleging that Credit Suisse knowingly laundered officials’ funds and held assets traceable to those officials.
- The district court dismissed all defendants except Credit Suisse AG for lack of personal jurisdiction (Fed. R. Civ. P. 12(b)(2)) and dismissed the remaining claims for failure to state a claim (Fed. R. Civ. P. 12(b)(6)).
- Appellants relied in part on two 1997 transfers from Credit Suisse accounts to New York accounts as the basis for jurisdiction; they also sought jurisdictional discovery and leave to amend.
- The Second Circuit reviewed de novo and affirmed, holding appellants failed to plead relatedness for specific jurisdiction, failed to allege continuous/systematic contacts for general jurisdiction, and that several claims were time-barred or otherwise insufficiently alleged.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over CS Guernsey and CS Trust | Two 1997 transfers to NY accounts and other ties establish jurisdiction; requested discovery to show more contacts | Transfers unrelated in time to appellants’ claims; minimal NY ties (correspondent accounts) insufficient; no continuous/persistent NY business | No jurisdiction: transfers predated plaintiffs’ claim and lack required relatedness; correspondent accounts insufficient for general jurisdiction; discovery denied |
| Statute of limitations for tort-based counts (Counts 2,3,5–8) | Recent conduct by defendants (2012) defeats limitations argument | Alleged actionable conduct by Credit Suisse occurred in late 1990s; complaint filed over a decade later | Time-barred: complaint does not allege actionable post-1990s conduct, so claims are untimely |
| Turnover/possession claim for assets (Count 1) | Seeks turnover of assets allegedly held by Credit Suisse for the officials | Only specific allegations of account holdings date to the 1990s; no current possession pleaded | Dismissed: complaint fails to allege that Credit Suisse currently holds the funds sought |
| Leave to amend / jurisdictional discovery | Requested expedited jurisdictional discovery and leave to amend to cure defects | Arguments insufficiently specific; amendment would be futile because no plausible jurisdictional or substantive facts identified | Denied: request was conditional and insufficient; amendment would be futile |
Key Cases Cited
- Grand River Enters. Six Nations, Ltd. v. Pryor, 425 F.3d 158 (2d Cir.) (standard of review for personal jurisdiction dismissal)
- Licci v. Lebanese Canadian Bank, SAL, 20 N.Y.3d 327 (N.Y. 2012) (relatedness requirement for jurisdiction based on transfers)
- In re Terrorist Attacks on September 11, 2001, 714 F.3d 659 (2d Cir.) (correspondent bank accounts insufficient for general jurisdiction)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct.) (pleading standard — plausibility)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Sup. Ct.) (pleading standard for plausible claim)
- Volkswagenwerk Aktiengesellschaft v. Beech Aircraft Corp., 751 F.2d 117 (2d Cir.) (parent-subsidiary relationship insufficient for jurisdiction absent disregard of separate corporate existence)