KRISHANTHI et al v. RAJARATNAM et al
Filing
186
OPINION. Signed by Judge Jose L. Linares on 9/19/14. (jd, )
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
KARUNAMUNIGE CHAMILA
KRISHANTHI, et al.,
Civil Action No. 09-5395 (JLL)
Plaintiffs,
OPINION
v.
RAJAKUMARA RAJARATNAM,
JESUTHASAN RAJARATNAM, and TAMIL
REHABILITATION ORGANIZATION,
Defendants.
LINARES, District Judge.
This matter comes before the Court by way of Defendant Tamil Rehabilitation
Organization (“Defendant” or “TRO”)’s motion to dismiss Plaintiffs’ Amended Complaint
pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. [CM/ECF No. 174.] The Court
has considered the submissions made in support of and in opposition to the instant motion. No
oral argument was heard pursuant to Federal Rule of Civil Procedure 78. For the reasons that
follow, Defendants’ motion to dismiss is granted. Plaintiffs’ Amended Complaint is dismissed
without prejudice as to Defendant TRO.
I.
BACKGROUND
In an Opinion dated April 28, 2014, this Court set forth in detail the factual and procedural
history of this case. (Docket #161.) As the Court writes only for the parties, it will set forth only
those facts it deems relevant to deciding TRO’s motion to dismiss.
The Liberation Tigers of Tamil Elam (the “LTTE”) was founded in Sri Lanka in 1976. The
United States government has designated the LTTE as a foreign terrorist organization since 1997.
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Their goal is to establish a mono-ethnic Tamil State in northern Sri Lanka. According to the
Federal Bureau of Investigation, the LTTE has murdered over 4,000 people since 2006. The LTTE
is particularly known for its use of suicide bombings. The Plaintiffs in this case are victims of
bombing attacks perpetrated by the LTTE in Sri Lanka in November 2007, February 2008, and
April 2008.
TRO is a Sri Lankan based non-governmental organization that generates funds for the
LTTE. TRO’s main United States branch is located in Cumberland, Maryland. Plaintiffs state that
TRO also maintains an office in Princeton Junction, New Jersey. On November 15, 2007, the
United States Treasury Department (“USTD”) designated TRO as a “charitable organization that
acts as a front to facilitate fundraising and procurement for the LTTE.” This designation prohibits
United States individuals from engaging in activities with TRO. The USTD further specified that
TRO-USA is the largest contributor to TRO’s Sri Lankan branch. Additionally, the USTD
expressly stated that TRO is “the preferred conduit of funds from the United States to the LTTE
in Sri Lanka,” and that TRO facilitated the “purchase of munitions, communication devices, and
other technology for the LTTE” in the United States. Further, the United States Department of
State indicated that “as late as 2007, [TRO-USA] was responsible for the largest percentage of
overseas donations to the LTTE of any TRO office.”
Plaintiffs allege that TRO funds have been used to pay the salaries of LTTE members and
to pay pension benefits to the families of LTTE members who have been killed. Plaintiffs also
claim that TRO knowingly gave money to the LTTE for the purpose of assisting the LTTE in
carrying out the terrorist attacks that killed or injured Plaintiffs and their families. TRO held events
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in New Jersey which commemorated LTTE fighters and raised money that was subsequently sent
to the LTTE.
Plaintiffs filed an Amended Complaint against TRO on June 13, 2014, alleging i) aiding
and abetting crimes against humanity, ii) aiding and abetting acts of terrorism, iii) reckless
disregard, iv) negligence, v) wrongful death, vi) survival action, and vii) negligent/intentional
inflection of emotional distress (Docket #163.) Defendant TRO filed a Motion to Dismiss on
August 1, 2014, arguing that the Complaint should be dismissed for lack of personal and subject
matter jurisdiction. (Docket #174.)
II.
LEGAL STANDARD
The Federal Rules of Civil Procedure states that a defendant may move to dismiss a
complaint for “lack of personal jurisdiction.” Fed. R. Civ. P. 12(b)(2). Once a defendant moves to
dismiss a complaint for lack of personal jurisdiction, “the plaintiff bears the burden of establishing
with reasonable particularity sufficient contacts between the defendant and the forum state.”
Provident Nat’l. Bank v. Cal. Fed. Sav. & Loan Ass’n, 819 F.2d 434, 437 (3d Cir. 1987); see also
Mellon Bank (East) PSFS, Nat’l Assn. v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992) (“[T]he
plaintiff [must] come forward with sufficient facts to establish that jurisdiction is proper.”).
Pursuant to 28 U.S.C. § 1332, a federal district court may exercise jurisdiction over a nonresident defendant to the extent permitted by the law of the state in which it sits. See O’Connor v.
Sandy Lane Hotel Co., Ltd., 496 F.3d 312, 316 (3d Cir. 2007); Provident Nat’l Bank v. Cal. Fed.
Sav. & Loan Ass'n, 819 F.2d 434, 436 (3d Cir. 1987); Fed. R. Civ. P. 4(k). New Jersey’s long-arm
statute allows a court to exercise personal jurisdiction over non-resident defendants to the full
extent allowed under the due process requirements of the United States Constitution. See N.J.Ct.
R. 4:4–4; Eaton Corp. v. Maslym Holding Co., 929 F.Supp. 792, 796 (D.N.J. 1996). Accordingly,
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a party’s amenability to suit in New Jersey “must be judged by Fourteenth Amendment standards.”
DeJames v. Magnificence Carriers, Inc., 654 F.2d 280, 284 (3d Cir. 1981).
To comply with the due process clause of the Fourteenth Amendment, a court must employ
a two-part analysis. Vetrotex Certainteed Corp. v. Consolidated Fiber Glass Products Co., 75 F.3d
147, 150 (3d Cir.1995). First, a court may not exercise personal jurisdiction over a non-resident
defendant unless the defendant has certain ‘minimum contacts’ with the forum. World–Wide
Volkswagen Corp.v. Woodson, 444 U.S. 286, 291 (1980). To find ‘minimum contacts,’ a court
must determine that the defendant has purposefully directed its activities towards the forum.
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985). Thus, there must be “some act by
which the defendant purposefully avails itself of the privilege of conducting activities within the
forum State, thus invoking the benefits and protections of its laws.” Hanson v. Denckla, 357 U.S.
235, 253 (1958). Second, if ‘minimum contacts’ are shown, “jurisdiction may be exercised where
the court determines, in its discretion, that to do so would comport with ‘traditional notions of fair
play and substantial justice’” Vetrotex, 75 F.3d at 150–51 (citing Int’l Shoe v. Washington, 326
U.S. 310, 326 (1945)).
Minimum contacts may give rise to two types of personal jurisdiction: general jurisdiction
and specific jurisdiction. To establish general jurisdiction, a plaintiff must demonstrate that a
defendant “engaged in ‘continuous and systemic’ contacts with the forum state.” Mellon Bank
(East) PSFS, N.A. v. DiVeronica Bros., Inc., 983 F.2d 551, 554 (3d Cir. 1992). Specific jurisdiction
is appropriate where “(1) the defendant purposefully directed its activities at residents of the forum;
(2) the claim arises out of or relates to the defendant's activities with the forum; and (3) assertion
of personal jurisdiction is reasonable and fair.” Synthes (U.S.A.) v. G.M. Dos Reis Jr. Ind. Com de
Equip. Medico, 563 F.3d 1285, 1291 (Fed. Cir. 2009). “The first two factors correspond with the
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‘minimum contacts’ prong of the Supreme Court’s International Shoe analysis, and the third factor
corresponds with the ‘fair play and substantial justice’ prong of the analysis.” Inamed Corp. v.
Kuzmak, 249 F.3d 1356, 1360 (Fed. Cir. 2001).
III.
DISCUSSION
In response to Defendant’s motion to dismiss,1 Plaintiffs claim that this Court has personal
jurisdiction over TRO under two theories: “(1) personal service within New Jersey on [TRO] under
the laws of New Jersey comporting with due process; and (2) specific personal jurisdiction based
on TRO’s contacts with New Jersey that are sufficiently related to Plaintiff’s injuries at the hands
of the [LTTE] terrorist organization.”
A. Personal Service on TRO’s Director
Plaintiffs argue that “N.J. Court Rule 4:4-4(a)(6) permits in personam jurisdiction in this
case over TRO.” (Pl. Br. 8.) They claim that, according to this section of the rule, “personal
jurisdiction can be obtained over a non-New Jersey defendant corporation” by personally serving
an officer of that corporation. (Id.) This Court disagrees.
Paragraph (a) of R. 4:4-4 is inapplicable to this case because it deals with “personal service
on individuals and entities who have a territorial presence in this State, that is, those who are
subject to the State’s exercise of in personam jurisdiction on the fundamental predicate of their
being here.” Citibank, N.A. v. Estate of Simpson, 676 A.2d 172, 176 (App. Div. 1996). However,
personal service on someone who is authorized to receive service on behalf of a foreign corporation
is insufficient to establish the necessary territorial presence that would subject that corporation to
this State’s in personam jurisdiction. See Nehemiah v. Athletics Cong. of U.S.A., 765 F.2d 42, 47
(3d Cir. 1985) (“Since it is undisputed that mere service on a corporate agent cannot establish
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TRO also argues that Plaintiffs’ Amended Complaint should be dismissed for lack of subject matter jurisdiction.
This Court will not address this argument because it is unnecessary to decide this matter.
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personal jurisdiction without a minimum contacts inquiry, we can find no cogent reason not to
apply the same principle to an unincorporated association.”); Estate of Simpson, 676 A.2d at 177.
As such, TRO is not physically present in New Jersey for the purpose of R. 4:4-4.
The applicable section of this rule to the matter at hand is R. 4:4-4(b). Paragraph (b) refers
to the appropriate service of “individuals and entities who are not present in the state but who, as
a matter of due process of law, are subject to the exercise of its long-arm jurisdiction.” Estate of
Simpson, 676 A.2d at 176. Service under R. 4:4-4(b), like service under paragraph (a),2 does not
grant personal jurisdiction. Instead, “[c]onstitutional principles determine whether that service is
effective for obtaining jurisdiction.” Id. at 176-77. Service of a non-resident defendant is effective
under the constitutional principle of due process of law when that defendant has ‘minimum
contacts’ with the forum. Woodson, 444 U.S. at 291. A plaintiff can show that a defendant has
‘minimum contacts’ with the forum if they allege sufficient facts to establish either general or
specific jurisdiction. See Burger King, 471 U.S. at 474. Thus, personal service alone is insufficient
to establish personal jurisdiction. See, e.g., Nehemiah, 765 F.2d at 47; Estate of Simpson, 676 A.2d
at 177. As such, Plaintiffs’ first theory for establishing personal jurisdiction is inapplicable to this
case.
B. Specific Jurisdiction
The analysis for determining whether a court has specific jurisdiction over a defendant has
three parts. First, a court must establish whether the defendant “‘purposefully directed [its]
activities’ at the forum.” O’Connor, 496 F.3d at 317 (quoting Burger King, 471 U.S. at 472). The
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Rule 4:4-4 “does not undertake to define jurisdictional limits. It is rather a mechanical rule that merely prescribes
the method of acquiring jurisdiction when constitutional principles of due process of law—not the rule—permit
assertion of jurisdiction.” Estate of Simpson, 676 A.2d at 176. An assertion of jurisdiction over a defendant that is
physically present in New Jersey under paragraph (a) is permitted under the principle of due process because of that
party’s physical presence in the state. Id. Thus, the minimum contacts analysis is unnecessary under R. 4:4-4(a).
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court must then decide whether “the litigation . . . “arise[s] out of or relate[s] to” at least one of
those activities. Id. (quoting Helicopteros, 466 U.S. at 414; Grimes v. Vitalink Commc’ns Corp.,
17 F.3d 1553, 1559 (3d Cir. 1994)). “[I]f the prior two requirements are met, a court may consider
whether the exercise of jurisdiction otherwise “comport[s] with ‘fair play and substantial justice.’”
Burger King, 471 U.S. at 476 (quoting Int’l Shoe, 326 U.S. at 320). Though Plaintiffs have shown
that TRO ‘purposefully directed’ its activities at New Jersey,3 satisfying the first prong, they have
failed to allege new facts that show that their injuries ‘arise out of or relate’ to those activities.
As this Court stated in its prior opinion, the Third Circuit has held that the inquiry of
whether an injury ‘arises out of or relates’ to a defendant’s actions begins with a “but for” causation
test, which is satisfied “when the plaintiff's claim would not have arisen in the absence of the
defendant’s contacts.” O’Connor, 496 F.3d at 319; See also Med. Transcription Billing Corp. v.
Bronx-Lebanon Hosp. Ctr., No. 12-1028, 2012 WL 2369425, at *3 (D.N.J. June 20, 2012) (“In
O’Connor, the [Third Circuit] fully addressed [the relatedness requirement] for the first time.
There, the court held that but-for causation was a necessary requirement for establishing
relatedness between a defendant’s purposeful contacts and each specific cause of action.”); Stinnett
v. Atl. City Showboat, Inc., No. 07-4743, 2008 WL 1924125, at *6 n. 3 (E.D. Pa. Apr. 28, 2008)
(stating that “district courts are advised to ensure the existence of ‘some minimal link between
contacts and claims’ by beginning their analysis ‘with but-for causation’”). This Court previously
held that Plaintiffs failed to show any facts that establish that the LTTE’s bombings would not
have occurred but for TRO’s New Jersey-specific activities. In doing so, this Court specifically
noted that “[w]hile Plaintiffs’ allegations indicate that TRO raised money in New Jersey with the
3
This Court has previously held that Plaintiffs have shown that TRO ‘purposefully directed’ its activities at New
Jersey. (Docket #161.)
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intent that the money would eventually reach the LTTE, Plaintiffs have not shown that any of the
money raised by TRO in New Jersey was used to facilitate the relevant bombings.” (Docket #161.)
Plaintiffs have failed to allege any additional facts that would allow the Court to draw the
reasonable inference that the money raised by TRO in New Jersey was used to injure Plaintiffs.
Instead, they now argue that the “relatedness requirement set forth in O’Connor does not require
Plaintiffs to establish in this stage that the money raised in New Jersey was used to pay for the
bombs that were used in the respective attacks carried out by the LTTE.” (Pl. Br. 15.) Though this
Court rejected this very argument in its April 28, 2014 decision, (Docket #161), Plaintiffs did not
raise this issue on a motion for reconsideration. This Court’s prior holding is now law of the case.
It is improper for Plaintiffs to attempt to collaterally challenge this Court’s prior rulings through a
response brief.
Furthermore, Plaintiffs fail to point to authority binding on this Court that supports their
interpretation of O’Connor. Instead, Plaintiffs seem to substitute O’Connor’s but-for causation test
with the reasoning that they will ultimately succeed on the merits. (See Pl. Br. 13) (“[T]hough
proximate cause is not the standard to determine personal jurisdiction, Plaintiffs will prove at trial
that TRO’s conduct proximately caused Plaintiffs’ injuries. . . . the standard [in terrorist financing
cases] is whether it was reasonably foreseeable that when TRO provided funding to the LTTE . . .
the LTTE would cause injuries to the class of people including plaintiffs here.” (Pl. Br. 13.) This
is not the proper standard for establishing specific jurisdiction.
Because Plaintiffs have not alleged any additional facts to establish that LTTE’s bombings
would not have occurred but for TRO’s New Jersey-specific activities, Plaintiffs’ Amended
Complaint is dismissed without prejudice as to Defendant TRO. To the extent the pleading
deficiencies discussed herein can be cured by way of amendment, the Court will grant Plaintiffs
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with one final opportunity to do so. Plaintiffs may file a Second Amended Complaint on or before
October 31, 2014.
IV.
CONCLUSION
Based on the reasons set forth above, Defendant TRO’s motion to dismiss [CM/ECF No.
174] is granted. Plaintiffs’ Amended Complaint is dismissed without prejudice as to TRO. This
Court will grant Plaintiffs one final opportunity to file a Second Amended Complaint that cures
the pleading deficiencies discussed herein. Plaintiffs’ failure to do so on or before October 31,
2014 will result in dismissal of Plaintiffs’ claims as to Defendant TRO with prejudice.
An appropriate Order accompanies this Opinion.
__/s Jose L. Linares______
Jose L. Linares
United States District Judge
Dated: September _19_, 2014
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