Shlomo Leibovitich, et al v. Bank of Tokyo-Mitsubishi UFJ,, et al

Filing

Filed opinion of the court by Judge Posner. AFFIRMED. Richard A. Posner, Circuit Judge; Frank H. Easterbrook, Circuit Judge and Daniel A. Manion, Circuit Judge. [6829570-1] [6829570] [16-2504]

Case: 16-2504

Document: 36

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In the

United States Court of Appeals
For the Seventh Circuit
____________________
No. 16-2504
SHLOMO LEIBOVITCH, et al.,
Plaintiffs-Appellants,
v.
ISLAMIC REPUBLIC OF IRAN, et al.,
Defendants,
and
BANK OF TOKYO-MITSUBISHI UFJ, LTD. and BNP PARIBAS,
Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 08 C 1939 — Ruben Castillo, Chief Judge.

____________________
ARGUED FEBRUARY 23, 2017 — DECIDED MARCH 29, 2017
____________________
Before POSNER, EASTERBROOK, and MANION, Circuit Judges.
POSNER, Circuit Judge. In 2003, a 7-year-old Israeli girl was
killed, her 3-year-old sister (an American citizen) perma-

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nently disabled, and six Israeli members of the children’s
family (two other siblings of the Israeli girl plus her parents
and grandparents) were injured emotionally, when the
minivan they all were riding in on a highway in Jerusalem
was shot up by members of Palestine Islamic Jihad, a terrorist group supported by the government of Iran.
The surviving family members, plus the estate of the
child who was killed, filed a damages suit against the Islamic Republic of Iran and its Ministry of Information and Security (we’ll simplify by pretending that the only defendant is
Iran) in the federal district court in Chicago, under both the
Antiterrorism Act, 18 U.S.C. § 2333, and the Foreign Sovereign Immunities Act, 28 U.S.C. § 1605A. After protracted
proceedings that included an appeal to this court, see Leibovitch v. Islamic Republic of Iran, 697 F.3d 561 (7th Cir. 2012),
the district court entered a default judgment of $67 million
against the Iranian defendants.
But how to collect? The plaintiffs began their search with
two large foreign banks that had held Iranian assets in the
past. Although both the Japanese bank, Bank of TokyoMitsubishi UFJ, Limited, and the French bank, BNP Paribas,
have branches in Chicago, neither branch holds any Iranian
government assets or has any information regarding such
assets held by other branches of their parent banks, or by the
parent banks themselves in their home offices (Tokyo and
Paris, respectively). In an effort to obtain that information,
the plaintiffs issued both federal subpoenas and Illinois citations (the equivalent of subpoenas) in the federal district
court in Chicago, seeking an order directing the parent
banks to reveal Iranian assets held in any of the far-flung,
worldwide branches of the two banks. See Fed. R. Civ. P. 45.

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The Japanese bank has branches in more than 40 countries
and the French bank has branches in 75 countries, and it is
possible that branches in some of those countries, or perhaps
the home offices of the two parent banks, hold Iranian assets
that the plaintiffs might be able to seize by means of their
default judgment.
The banks agreed to provide the information sought by
the plaintiffs’ citations and subpoenas, but only with respect
to their 17 branches in the United States—and it turns out
that there are no Iranian assets in any of those branches. The
total number of branches of the two banks worldwide exceeds 7,500, and plaintiffs insist that they are entitled, by virtue of their subpoenas and citations, to compel the parent
banks to search all their branches for Iranian government assets—assets that once located the plaintiffs might be able to
execute their default judgment against. The banks asked the
district court to quash the subpoenas, arguing that the federal court does not have personal jurisdiction over them to
force them to comply.
At the oral argument of the appeal, the plaintiff’s counsel
argued that personal jurisdiction is irrelevant for enforcing
subpoenas under Rule 45. That can’t be right, for a court that
issues subpoenas is enforcing something rather than begging,
and so far as we know no court has bought the argument.
See, e.g., Gucci America, Inc. v. Weixing Li, 768 F.3d 122, 134,
136–37 (2d Cir. 2014); 9A Charles A. Wright et al., Federal
Practice & Procedure § 2454, pp. 398–99 (3d ed. 2008). So to be
entitled to use the federal district court in Chicago to obtain
from the parent banks the worldwide information that the
plaintiffs seek, they had to be able to prove that the court has
personal jurisdiction over the banks, that is, jurisdiction over

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the “persons” (the two banks) against which relief is
sought—hence jurisdiction to subpoena them.
It’s not as if the foreign banks are incorporated or headquartered in the United States. If they were, they would be
within the court’s personal jurisdiction, and the district court
could force them to comply with any discovery request that
didn’t present an undue burden. But “a court may assert jurisdiction over a foreign corporation ‘to hear any and all
claims against [it]’ only when the corporation’s affiliations
with the State in which suit is brought are so constant and
pervasive ‘as to render [it] essentially at home in the forum
State.’” Daimler AG v. Bauman, 134 S. Ct. 746, 751 (2014). That
is hardly the situation with regard to the two foreign banks.
It is true that a district court can have what is called
“specific” jurisdiction over a corporation if the corporation’s
activities within the jurisdiction of the court are closely related to the lawsuit or, as in this case, to subpoenas (or statecourt citations, which needn’t be discussed separately) issued within that jurisdiction. See, e.g., Walden v. Fiore, 134 S.
Ct. 1115, 1121–23 (2014); World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 291–92 (1980); Application to Enforce
Administrative Subpoenas of S.E.C. v. Knowles, 87 F.3d 413, 417
(10th Cir. 1996). But the subpoenas issued in this case are not
tailored to the banks’ presence or activities in the United
States. If the subpoenas sought only to discover whether,
and if so what, Iranian government assets were in either or
both of the two Chicago branch banks, the district court
would have jurisdiction to enforce the subpoenas (and citations) because the branches are in the court’s district. But we
now know that the Chicago branches neither are holding
Iranian government assets nor know which if any of their

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sister branches elsewhere (either in or outside the United
States), or the parent banks’ home offices, are holding any
such assets. That being so, there can be no personal jurisdiction over the parents. As there’s no indication that any U.S.
branch of either bank is holding Iranian assets, if the plaintiffs are determined to execute their default judgment
against Iranian government assets they’ll have to look
abroad.
We’re puzzled that none of the plaintiffs who brought
the suit against Iran that resulted in the default judgment are
residents of Illinois. Why they are suing here rather than in
the districts in which they live or work is unexplained. What
is worse than merely unexplained is that they’ve presented
no evidence to suggest that the two Chicago branch banks
are either holding Iranian government assets or have any
knowledge of where those assets might be held. In short,
what are they doing here?
The briefs filed in this case sum to 140 pages and include
numerous issues that we haven’t touched on—having no
need to do so. It should be apparent from what we’ve said so
far that the plaintiffs have no legal right to the information
that they have demanded from the respondent Tokyo and
Paris banks.
AFFIRMED