Strauss et al v. Credit Lyonnais, S.A.
ORDER denying (366) Motion to Dismiss in case 1:06-cv-00702-DLI-MDG; denying (255) Motion to Dismiss in case 1:07-cv-00914-DLI-MDG --- For the reasons set forth in the ATTACHED WRITTEN OPINION AND ORDER, Defendant's motion to dismiss this action or, in the alternative for summary judgment, is denied in its entirety. These cases are referred to the magistrate judge for further pretrial proceedings. SO ORDERED by Judge Dora Lizette Irizarry on 3/31/2016. (Irizarry, Dora)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
MOSES STRAUSS, et al.,
CRÉDIT LYONNAIS, S.A.,
BERNICE WOLF, et al.,
CRÉDIT LYONNAIS, S.A.,
DORA L. IRIZARRY, U.S. District Judge:
OPINION AND ORDER
06-cv-702 (DLI) (MDG)
07-cv-914 (DLI) (MDG)
This is a consolidated action pursuant to the civil liability provision of the Antiterrorism
Act of 1992 (“ATA”), 18 U.S.C. § 2333(a) (“§ 2333(a)”). Plaintiffs, over 200 individuals and
estates of people who are deceased (collectively, “Plaintiffs”), seek to recover damages from
Defendant Crédit Lyonnais, S.A. (“Defendant”) in connection with 19 attacks in Israel and
Palestine allegedly perpetrated by Hamas. (See generally Fourth Am. Compl., (“Strauss FAC”),
Strauss Dkt. Entry No. 358; Compl. (“Wolf Compl.”), Wolf Dkt. Entry No. 1).1 Specifically,
Plaintiffs allege that Defendant is civilly liable pursuant to the ATA’s treble damages provision
Citations to the “Strauss Dkt.” are to docket 06-cv-702. Citations to the “Wolf Dkt.” are to 07-cv-914. Where the
same document has been filed on both dockets, the Court cites to the Strauss Docket only, as it is the lead case.
for: (1) aiding and abetting the murder, attempted murder, and serious physical injury of
American nationals outside the United States in violation of 18 U.S.C. § 2332; (2) knowingly
providing material support or resources to a Foreign Terrorist Organization (“FTO”) in violation
of 18 U.S.C. § 2339B; and (3) willfully and unlawfully collecting and transmitting funds with the
knowledge that such funds would be used for terrorist purposes in violation of 18 U.S.C. §
2339C. (Strauss FAC ¶¶ 672-90; Wolf Compl. ¶¶ 407-25.) Defendant moves for dismissal of
this action for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of
Civil Procedure, or in the alternative, for summary judgment pursuant to Rule 56. (See Def.’s
Mem. of Law in Supp. of Mot. to Dismiss (“Def.’s Mem.”), Strauss Dkt. Entry No. 369.)
Plaintiffs oppose. (See Pls.’ Mem. of Law in Opp’n to Mot. to Dismiss (“Pls.’ Opp’n”), Strauss
Dkt. Entry No. 371.) For the reasons set forth below, Defendant’s motion is denied in its
Plaintiffs’ claims arise from 19 terrorist attacks that occurred in Israel and Palestine
between approximately 2001 and 2004, which allegedly were perpetrated by Hamas.3 See
Strauss v. Crédit Lyonnais, S.A. (“Strauss II”), 925 F. Supp. 2d 414, 418 (E.D.N.Y. 2013).
The Court assumes familiarity with the facts underlying this action, which are summarized more fully in the
Court’s February 28, 2013 Opinion and Order on the parties’ cross-motions for summary judgment. See Strauss v.
Crédit Lyonnais, S.A. (“Strauss II”), 925 F. Supp. 2d 414 (E.D.N.Y. 2013). The facts recounted herein are drawn
from the statement of facts set forth in that Opinion and Order, affidavits submitted in connection with the motions
for summary judgment that were the subject of that Order, the pleadings, and certain materials submitted by the
parties in connection with the instant motion. See Baron Philippe de Rothschild, S.A. v. Paramount Distillers, Inc.,
923 F. Supp. 433, 436 (S.D.N.Y. 1996) (“Matters outside the pleadings, however, may also be considered in
resolving a motion to dismiss for lack of personal jurisdiction pursuant to Fed. R. Civ. P. 12(b)(2) without
converting it into one for summary judgment.”) (citing Visual Sciences, Inc. v. Integrated Comms., Inc., 660 F.2d
56, 58 (2d Cir. 1981)).
Hamas is an acronym for “Harakat al-Muqawama al-Islamiyya,” also known as the “Islamic Resistance
Movement.” (Strauss FAC. ¶ 1 n.1.)
Plaintiffs comprise over 200 United States nationals who were injured in those attacks, the
estates of persons killed in those attacks, and/or family members of persons killed or injured in
those attacks. Id.
Defendant is a financial institution incorporated and headquartered in France. Id. At the
time of the events giving rise to this action, Defendant conducted business in New York through
the Crédit Lyonnais Americas New York Branch (Defendant’s “New York Branch”).4 (See
Decl. of Joseph Virgilio (“Virgilio Decl.”) ¶ 2, Ex. 3 to the Decl. of Emily P. Eckstut in Supp. of
Def’s. Mot. for Summary Judgment, Strauss Dkt. Entry No. 316-1.) According to Defendant,
the New York Branch served as the “intermediary bank for U.S. Dollar denominated transfers
that were requested by customers of Crédit Lyonnais in France.” (Id.) Plaintiffs allege that
Defendant also maintains an office in Miami, Florida, and is registered with State banking
authorities there. (Strauss FAC ¶ 579; Wolf Compl. ¶ 316.)
Among other customers, Defendant maintained bank accounts in France for the Comite
de Bienfaisance et de Secours aux Palestiniens (“Committee for Palestinian Welfare and Relief”)
(“CBSP”), a non-profit organization registered in France and self-described as providing
humanitarian aid to various charitable organizations in the West Bank, Gaza, and surrounding
areas. See Strauss II, 925 F. Supp. 2d at 418-19. During the time CBSP had accounts with
Defendant, it transferred money to certain charitable organizations (each a “Charity,” and
collectively the “Charities”) that Plaintiffs contend actually were front organizations for Hamas.
See Id. at 419. Plaintiffs allege that Defendant aided Hamas by maintaining CBSP’s accounts
and sending money to the Charities on CBSP’s behalf, despite knowing that CBSP supported
Plaintiffs contend that the New York Branch was a “legally inseparable” corporate branch maintained by
Defendant, rather than a subsidiary with an independent corporate existence. (See Pl.s’ Opp’n at 12 n.26.)
Nevertheless, the Court uses the term “New York Branch” as a matter of convenience only.
Hamas. See Id. at 424-25. While the vast majority of transfers Defendant made to the Charities
on behalf of CBSP never went through the United States, the parties agree that Defendant
executed five such transfers through its New York Branch (the “New York Transfers”), each in
response to a specific request by CBSP to send funds in U.S. Dollars. (See Ex. A to the Oct. 16,
2015 Friedman Ltr., Strauss Dkt. Entry No. 393.) The relevant electronic transfer records reflect
that each New York Transfer was initiated by Defendant in Paris and routed through its New
York Branch, then was directed for the benefit of the respective Charity to a correspondent
account maintained by that Charity’s bank either at a New York branch of Arab Bank, PLC, or in
one instance, Citibank N.A. (See Exs. A-D to the Feb. 7, 2014 Osen Ltr., Strauss Dkt. Entry No.
362; Ex. B to the Oct. 16, 2015 Osen Ltr., Strauss Dkt. Entry No. 392; Ex. A to the Oct. 16, 2015
After initially commencing an action against Defendant in the United States District
Court for the District of New Jersey, Plaintiffs refiled the Strauss case in this Court in February
2006. The initial complaint, and every amended complaint thereafter, alleged that Defendant is
subject both to general personal jurisdiction (“general jurisdiction”) and specific personal
jurisdiction (“specific jurisdiction”) in the United States. (See Strauss FAC ¶ 4; see also Wolf
Compl. ¶ 4.) Following its voluntary acceptance of service of process in February 2006, (Strauss
Dkt. Entry No. 3), Defendant moved for dismissal of the Strauss action pursuant to Rule
12(b)(6), declining to contest personal jurisdiction at that time. (See Mot. to Dismiss, Strauss
Dkt. Entry No. 10.) The late Honorable Charles P. Sifton, then presiding, denied the motion to
dismiss with respect to Plaintiffs’ claims that Defendant provided material support to an FTO
and knowingly transmitted funds that financed terrorism, but dismissed Plaintiffs’ aiding and
abetting claim, with leave to amend. Strauss v. Crédit Lyonnais, S.A. (“Strauss I”), 2006 WL
2862704 (E.D.N.Y. Oct. 5, 2006). Defendant similarly accepted service in the Wolf action and
thereafter filed a motion to dismiss, which the parties resolved by stipulation without any
objection by Defendant as to personal jurisdiction. (See Wolf Dkt. Entry Nos. 6, 13, and 31.)
Extensive merits discovery between the parties ensued. On October 7, 2011, the Court
formally consolidated the Strauss and Wolf actions. Thereafter, Defendant moved for summary
judgment dismissing the consolidated action, but again declined to raise a defense of lack of
personal jurisdiction. (See Strauss Dkt. Entry No. 293.) By Opinion and Order dated February
28, 2013, the Court granted summary judgment in favor of Defendant with respect to one attack
for which certain Plaintiffs sought recovery, but denied Defendant’s motion with respect to
Plaintiffs’ claims concerning more than a dozen other attacks. See Strauss II, 925 F. Supp. 2d at
On February 6, 2014, Defendant notified the Court that, in light of the Supreme Court’s
decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), it intended to assert a personal
jurisdiction defense for the first time in these proceedings. (See Feb. 6, 2014 Friedman Ltr.,
Strauss Dkt. Entry No. 361.) Decided in January 2014, Daimler addressed the extent to which a
forum State may exercise general jurisdiction over a foreign corporation. Revisiting its past
personal jurisdiction jurisprudence, the Supreme Court clarified that a corporation is subject to
general jurisdiction in a forum State only where its contacts are “so continuous and systematic,”
judged against the corporation’s nationwide and worldwide activities, that it is “essentially at
home” in that State. Daimler, 134 S. Ct. at 761 & n.20 (quoting Goodyear Dunlop Tires
Operations, S.A. v. Brown, 131 S. Ct. 2846, 2851 (2011)) (internal quotation marks omitted).
Aside from the “exceptional case,” the Supreme Court explained, a corporation is at home and
subject to general jurisdiction only in a State that represents its formal place of incorporation or
principal place of business. See Id. & nn.19-20. The Supreme Court emphasized that the
“exceptional case” exists only in rare and compelling circumstances like those in Perkins v.
Benguet Consol. Mining Co., 342 U.S. 437 (1952), where a foreign corporation maintained a
surrogate headquarters in Ohio during a period of wartime occupation in its native Philippines.
See Id. at 755-56 & nn.8, 19.
Citing the “new rule” on general jurisdiction purportedly announced in Daimler, (see
Feb. 6, 2014 Friedman Ltr.), Defendant filed the instant motion to dismiss this action pursuant to
Rule 12(b)(2) of the Federal Rules of Civil Procedure. In the alternative, Defendant contends
that it is entitled to summary judgment dismissing Plaintiffs’ claims because, at most, it is
subject to personal jurisdiction in New York only with respect to the five New York Transfers it
executed through its New York Branch. (See Def.’s Mem. at 15-25.) Renewing arguments from
its prior summary judgment motion, Defendant contends that no reasonable juror could find that
it possessed the requisite scienter to establish liability under the ATA when making those five
transfers, nor could a reasonable juror find that its activities as of the date of those transfers
proximately caused Plaintiffs’ injuries.
Plaintiffs oppose the instant motion, arguing as a threshold matter that Defendant waived
a personal jurisdiction defense by failing to raise one in its prior motions to dismiss the Strauss
and Wolf actions, then actively litigating this case for several years. (See Pl.s’ Opp’n at 4-11.)
Plaintiffs further argue that Daimler is distinguishable from this case, and therefore, the Court
may exercise general jurisdiction over Defendant even if it finds that Defendant did not waive its
personal jurisdiction defense. (See Id. at 12 n.27.) Finally, Plaintiffs contend that the Court may
exercise specific jurisdiction over Defendant based on its contacts with New York and the
broader United States, including most significantly the New York Transfers. (See Id. at 12-25.)
On October 8, 2015, oral argument was held on Defendant’s motion. (See Tr. of Oct. 8,
2015 Oral Argument (“Tr.”)). Following argument, at the Court’s request, the parties provided
additional information concerning the extent of the transfers Defendant made to the Charities on
behalf of CBSP, and the portion or percentage of those transfers that went through New York or
the broader United States. (See Strauss Dkt. Entry Nos. 391-97.) This decision followed.
Taken together, Rules 12(g)(2) and 12(h)(1) of the Federal Rules of Civil Procedure
provide that a party that moves to dismiss an action, but omits an available personal jurisdiction
defense, forfeits that defense. Even a party that complies with those rules may forfeit the right to
contest personal jurisdiction if it unduly delays in asserting that right, or acts inconsistently with
it. See, e.g., Insur. Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694,
702-04 (1982); Hamilton v. Atlas Turner, Inc., 197 F.3d 58, 61-62 (2d Cir. 1999). However, an
exception exists where a defendant seeks to assert a personal jurisdiction defense that previously
was not available, as it is well recognized that “a party cannot be deemed to have waived
objections or defenses which were not known to be available at the time they could first have
been made.” Holzsager v. Valley Hosp., 646 F.2d 792, 796 (2d Cir. 1981).
Here, Plaintiffs argue that Defendant waived its personal jurisdiction defense by omitting
that defense from its prior motions to dismiss the Strauss and Wolf actions, then actively
litigating this case over the course of several years. (See Pl.s’ Opp’n at 4-11.) However,
Plaintiffs’ argument is foreclosed by Gucci America, Inc. v. Weixing Li (“Gucci II”), 768 F.3d
122 (2d Cir. 2014). In Gucci II, non-party Bank of China appealed from an order of the district
court compelling it to comply with an asset freeze injunction and certain disclosures. For
purposes of that order, the district court assumed that Bank of China was subject to general
jurisdiction in New York because it maintained branch locations there. See Gucci Am. Inc., v.
Weixing Li (“Gucci I”), 2011 WL 6156936, at *4 n.6 (S.D.N.Y. Aug. 23, 2011), vacated 768
F.3d 122. While the appeal was pending, the Supreme Court decided Daimler, prompting Bank
of China to assert an objection that it was not subject to general jurisdiction in New York. That
objection ordinarily would have been waived because it was not raised in the district court.
However, the Second Circuit declined to find waiver, explaining that Bank of China’s personal
jurisdiction objection was not available until Daimler cast doubt upon, if not outright abrogated,
controlling precedent in this Circuit holding that a foreign bank with a branch in New York was
subject to general jurisdiction here. See Id. at 135-36 (citing Wiwa v. Royal Dutch Petroleum
Co., 226 F.3d 88, 93-95 (2d Cir. 2000)) (emphasis in original).
The same conclusion is compelled in this case. Under controlling precedent in this
Circuit prior to Daimler, Defendant was subject to general jurisdiction in New York because it
had a New York Branch through which it routinely conducted business. Gucci II expressly
acknowledged that, in the wake of Daimler, contact of such a nature with a forum State, absent
more, is insufficient to sustain general jurisdiction over a foreign corporation. See Gucci II, 768
F.3d at 134-35. Accordingly, just as the Daimler ruling permitted Bank of China to raise its
personal jurisdiction objection in Gucci II, it similarly permits Defendant to assert its personal
jurisdiction defense at this juncture. It follows that Defendant did not waive that defense, having
asserted it promptly after Daimler first made it available.
Other courts in this Circuit, relying on the Second Circuit’s application of Daimler in
Gucci II, have held similarly. See, e.g., In re LIBOR-Based Fin. Instruments Antitrust Litig.,
2015 WL 4634541, at *30-31 (S.D.N.Y. Aug. 4, 2015); 7 West 57th St. Realty Co., LLC v.
Citigroup, Inc., 2015 WL 1514539, at *5-7 (S.D.N.Y. Mar. 3l, 2015). Plaintiffs do not provide
any valid reason why this Court should depart from those decisions, or ignore the clear guidance
of Gucci II. At best, Plaintiffs argue that the question of waiver in this case is governed by Rule
12(h)(1) of the Federal Rules of Civil Procedure, which applies only to the parties to an action
and, thus, was inapplicable to Bank of China as a non-party in Gucci.
(See Sept. 23, 2014
Glatter Ltr., Strauss Dkt. Entry No. 378.) That argument is without merit. As relevant here,
waiver under Rule 12(h)(1) expressly is limited to the “circumstances described in Rule
12(g)(2).” Subject to limited exception, Rule 12(g)(2) prohibits a party from raising a defense by
way of a second motion to dismiss if that defense “was available to the party but omitted from its
earlier motion.” Fed. R. Civ. P. 12(g)(2) (emphasis added). In this respect, Rule 12(h)(1)
comports with the well settled principle that a party cannot be deemed to have waived defenses
not known to be available to it. See Holzsager, 646 F.2d at 796. Given the Court’s prior
determination that a personal jurisdiction defense was not available to Defendant prior to
Daimler, consideration of Rule 12(h)(1) does not alter the Court’s conclusion that Defendant did
not waive that defense.
Plaintiffs’ remaining arguments are similarly unavailing. Plaintiffs contend that, if the
Supreme Court narrowed the law on general jurisdiction, it did so three years before Daimler in
Goodyear, 131 S. Ct. 2846, in which case Defendant waived its personal jurisdiction defense by
waiting too long to assert it. (See Pl.s’ Opp’n at 10-11.) Plaintiffs’ argument finds limited
support outside this Circuit. See, e.g., Am. Fidelity Assur. Co. v. Bank of N.Y. Mellon, 2014 WL
4471606 (W.D. Okla. Sept. 10, 2014), aff’d 2016 WL 231474 (10th Cir. 2016); Gilmore v.
Palestinian Interim Self-Government Auth., 8 F.Supp. 3d 9 (D.D.C. June 23, 2014). However,
the Court is not aware of any authority in this Circuit holding that Goodyear, rather than
Daimler, narrowed the law on general jurisdiction. To the contrary, the issue was briefed in
Gucci II and the Second Circuit ultimately held that Daimler effected the relevant change in the
law.5 See Gucci II, 768 F.3d at 135-36; see also 7 West 57th St., 2015 WL 1514539, at *6-7
(rejecting argument that Goodyear altered the law on general jurisdiction, as “Gucci America
unequivocally holds . . . that Daimler effected a change in the law.”)
The Second Circuit recently reaffirmed that holding in Brown v. Lockheed Martin Corp.,
2016 WL 641392, at *6-7 (2d Cir. Feb. 18, 2016). There, the Second Circuit explained that
“Goodyear seemed to have left open the possibility that contacts of substance, deliberately
undertaken and of some duration, could place a corporation ‘at home’ in many locations.” Id. at
*7. However, Daimler all but eliminated that possibility, “considerably alter[ing] the analytic
landscape for general jurisdiction” by more narrowly holding that, aside from the truly
exceptional case, a corporation is at home and subject to general jurisdiction only in its place of
incorporation or principal place of business. Id.; see also Daimler, 134 S. Ct. at 760 (“Goodyear
did not hold that a corporation may be subject to general jurisdiction only in a forum where it is
incorporated or has its principal place of business”) (emphasis in original). As Defendant relies
on that newly articulated principle of law for its personal jurisdiction defense, it reasonably could
not have raised that defense prior to Daimler.
Plaintiffs also erroneously contend that Defendant actually contested personal jurisdiction
in this case as early as 2006, or at least could have, despite now asserting that its personal
jurisdiction defense only became available after Daimler. (Pl.s’ Opp’n at 9.) Plaintiffs base their
argument on representations by Defendant that it does not conduct business in the United States,
See, e.g., Letter Brief of Bank of China et al., Gucci Am., Inc. v. Bank of China, 2014 WL 1873367, at *3 (2d Cir.
Apr. 8, 2014).
which Defendant made in: (1) a November 2006 submission to the magistrate judge; and (2)
Defendant’s December 2006 answer to the first amended complaint. (See Ex. A to the Oct. 16,
2015 Osen Ltr., Strauss Dkt. Entry No. 391.) Upon review, the Court finds that neither filing
reasonably can be construed as asserting an objection as to personal jurisdiction.
In particular, in its 2006 submission to the magistrate judge, Defendant emphasized its
lack of business activity in the United States only in the context of arguing that it would be
unduly burdensome to disclose business records maintained in France. (See Def.’s Opp’n to
Pl.s’ Discovery Motion, Strauss Dkt. Entry No. 61, at 22-23.) Although the magistrate judge’s
order on the discovery motions at issue noted, in a footnote, that Defendant had waived a
personal jurisdiction defense by not raising one in its answer, see Strauss v. Crédit Lyonnais,
S.A., 242 F.R.D. 199, 203 n.5 (E.D.N.Y. 2007), the Court declines to treat that ruling as the law
of the case in light of the intervening change in the law effected by Daimler. See Johnson v.
Holder, 564 F.3d 95, 99 (2d Cir. 2009) (“We may depart from the law of the case for cogent or
compelling reasons including an intervening change in law . . .”) (internal quotation marks and
Plaintiffs’ argument that Defendant could have asserted a personal jurisdiction defense
earlier in this case fares no better. The crux of Plaintiffs’ argument is that, if Defendant really
conducted no business whatsoever in the United States, as it represented in 2006, then Defendant
had a valid basis to contest personal jurisdiction even under pre-Daimler precedent.
Nevertheless, as discussed, any argument by Defendant prior to Daimler that it was not subject
to personal jurisdiction in New York would have been futile because Defendant had a branch in
New York during the timeframe relevant to the Court’s jurisdictional inquiry. See Gucci II, 768
F.3d at 135-36; see also Porina v. Marward Shipping Co., Ltd., 521 F.3d 122, 128 (2d Cir. 2008)
(“In general jurisdiction cases, we examine a defendant’s contacts with the forum state over a
period that is reasonable under the circumstances—up to an including the date the suit was
filed.”) The Court declines to find that Defendant, in failing to raise a futile argument, waived its
personal jurisdiction defense.
Finally, Plaintiffs argue in passing that, even if an objection as to general jurisdiction was
unavailable to Defendant prior to Daimler, Defendant still could have challenged the existence of
specific jurisdiction earlier in this case. However, any challenge to that effect would have been
purely academic because, regardless of the outcome, Defendant still would have been subject to
general jurisdiction in New York under existing law at the time. To the extent Defendant failed
to contest specific jurisdiction at an earlier time, the Court is satisfied it was for that reason.
Accordingly, the Court concludes that Defendant did not waive its personal jurisdiction defense.
Once personal jurisdiction has been challenged, “the plaintiff bears the burden of
establishing that the court has jurisdiction over the defendant.” Bank Brussels Lambert v.
Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999). On a motion to dismiss for
lack of personal jurisdiction, the plaintiff need only make a prima facie showing that jurisdiction
exists to satisfy that burden. See Dorchester Fin. Secs., Inc. v. Banco BRJ, S.A., 722 F.3d 81, 84
(2d Cir. 2013). Where, as here, discovery regarding a defendant’s forum contacts has been
conducted but no evidentiary hearing has been held, the “plaintiff[’s] prima facie showing,
necessary to defeat a jurisdiction testing motion, must include an averment of facts that, if
credited by [the ultimate trier of fact], would suffice to establish jurisdiction over the
defendant.”6 Chloé v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158, 163 (2d Cir. 2010)
(quoting Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 567 (2d Cir. 1996))
(alterations in original). The Court must “construe the pleadings and affidavits in the light most
favorable to plaintiffs, resolving all doubts in their favor.” Porina, 521 F.3d at 126. However,
the Court is not to “draw argumentative inferences in the plaintiff’s favor,” Robinson v. Overseas
Military Sales Corp., 21 F.3d 502, 507 (2d Cir. 1994) (internal quotation marks and citation
omitted), or “accept as true a legal conclusion couched as a factual allegation.” Jazini v. Nissan
Motor Co., Ltd., 148 F.3d 181, 185 (2d Cir. 1998) (quoting Papasan v. Allain, 478 U.S. 265, 286
To make a prima facie showing that personal jurisdiction exists, a plaintiff must
demonstrate: “(1) proper service of process upon the defendant; (2) a statutory basis for personal
jurisdiction over the defendant; and (3) that [the court’s] exercise of jurisdiction over the
defendant is in accordance with constitutional due process principles.” Stroud v. Tyson Foods,
Inc., 91 F. Supp. 3d 381, 385 (E.D.N.Y. 2015) (citing Licci ex rel. Licci v. Lebanese Canadian
Bank, SAL (“Licci I”), 673 F.3d 50, 59-60 (2d Cir. 2012)). Here, because Defendant does not
dispute that it properly was served with process, the Court’s analysis primarily is a two-part
inquiry to determine whether there is a statutory basis for jurisdiction, and if so, whether due
process is satisfied.
In conducting this analysis, the Court distinguishes between general and specific
jurisdiction. General or “all-purpose” jurisdiction is “based on the defendant’s general business
contacts with the forum state and permits a court to exercise its power in a case where the subject
No jurisdictional discovery has been ordered in this matter. However, in the course of merits discovery, Plaintiffs
sought and obtained extensive disclosure concerning the relevant jurisdictional facts. As such, at oral argument in
connection with the instant motion, the parties agreed that further discovery directed to the jurisdictional facts would
be unnecessary. (See Tr. at 40:18-21; 41:22-42:8.)
matter of the suit is unrelated to those contacts.”
Metro. Life, 84 F.3d at 568 (quoting
Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16 & nn.8-9 (1984)). In
contrast, specific or “case-linked” jurisdiction depends “on the relationship among the defendant,
the forum, and the litigation,” Walden v. Fiore, 134 S. Ct. 1115, 1121 (2014), and is said to exist
where “a State exercises personal jurisdiction over a defendant in a suit arising out of or related
to the defendant’s contacts with the forum.”
Metro. Life, 84 F.3d at 567-68 (quoting
Helicopteros, 466 U.S. at 414-16 & nn.8-9).
A court may exercise general jurisdiction over a foreign corporation to hear any and all
claims against it when the corporation’s affiliations with the forum State are so continuous and
systematic as to render it essentially at home there. Goodyear, 131 S. Ct. at 2851 (citing Int’l
Shoe Co. v. Washington, 326 U.S. 310, 317 (1945)). Here, it is undisputed that New York is
neither Defendant’s principal place of business nor its place of incorporation. (See Strauss FAC
¶¶ 577-78; Wolf Compl. ¶¶ 314-15). Therefore, Defendant is not at home in New York under
either of the two paradigm bases for general jurisdiction discussed in Daimler. See Daimler, 134
S. Ct. at 760. It follows that exercising general jurisdiction over Defendant would not comport
with the principles of due process articulated in Daimler unless this is an exceptional case, akin
to Perkins, 342 U.S. 437, where Defendant’s contacts with New York are so substantial and of
such a nature as to render it essentially at home there. See Daimler, 134 S. Ct. at 761 n.19.
The Court has little difficulty concluding that the facts here do not present an exceptional
case. Defendant’s alleged contacts with New York are nowhere near as substantial as those in
Perkins, where the defendant corporation maintained a surrogate headquarters in Ohio, the forum
State. Id. By contrast, Defendant in this case merely had a New York Branch, which it used just
for that discrete element of its worldwide operations that required clearing U.S. Dollar transfers.
See Brown, 2016 WL 641392, at *8 (for purposes of a general jurisdiction analysis, a
corporation’s in-forum conduct must be assessed “in the context of the company’s overall
activity” throughout the United States and the world) (citing Daimler, 134 S. Ct. at 762 n.20)
(emphasis omitted). In fact, such contacts with New York are even more attenuated than those
maintained by Bank of China in Gucci II, which the Second Circuit deemed insufficient to
permit the exercise of general jurisdiction. See Gucci II, 768 F.3d at 135.
Moreover, Defendant’s New York contacts fall far short of the contacts maintained with
Connecticut by Lockheed Martin (“Lockheed”), the corporate defendant that was the subject of
the Second Circuit’s recent decision in Brown. For example, Lockheed continuously maintained
a physical presence in Connecticut for over 30 years, ran operations out of as many as four
leased locations in the State, employed up to 70 workers there, and derived about $160 million in
revenue from its Connecticut-based work during the relevant timeframe.7 Brown, 2016 WL
641392, at *6-7. Nevertheless, the Second Circuit held that those facts still did not rise to an
exceptional case that would support general jurisdiction over Lockheed in a forum where it
neither was headquartered nor incorporated. Id. at *7-9. In reaching its decision, the Second
Circuit emphasized that a corporation’s “mere contacts” with such a forum, “no matter how
systematic and continuous, are extraordinarily unlikely to add up to an exceptional case.” Id. at
*8 (internal quotation marks omitted).
Lockheed also was formally registered to do business in Connecticut. Notably, the Second Circuit declined to
interpret the Connecticut business registration statute as requiring foreign corporations to consent to general
jurisdiction as a condition of registration. Brown, 2016 WL 641392, at *9-18. The Second Circuit further observed
that, even if the statute required such consent, it is questionable whether such consent validly could confer general
jurisdiction over a foreign corporation after Daimler. Id. at *18. Here, although Defendant’s New York Branch was
registered in New York under § 200 of the Banking Law, the Court declines to find that Defendant consented to
general jurisdiction in New York by virtue of such registration. See 7 West 57th St., 2015 WL 1514539, at *11
(“The plain language of this provision limits any consent to personal jurisdiction by registered banks to specific
personal jurisdiction.”) (emphasis in original).
Given the fact that neither Gucci II nor Brown amounted to an exceptional case, the
instant case clearly is not exceptional either. Accordingly, in light of Daimler, there is no basis
for the Court to exercise general jurisdiction over Defendant in New York.
nevertheless attempt to distinguish Daimler on the ground that it involved a foreign corporation
with a subsidiary in the forum State, whereas in this case the New York Branch purportedly was
a legally inseparable branch office of Defendant. (See Pl.s’ Opp’n at 12 n.27.) However, that
distinction hardly renders Daimler inapposite. As a central principle, Daimler held that it would
be “unacceptably grasping” to permit general jurisdiction over a corporation in every State where
it engages in continuous and systematic business. Daimler, 134 S. Ct. at 761. There is no basis
to suggest that such reasoning, though articulated in the context of a case involving subsidiaries,
would not also apply in cases involving a foreign bank with a branch in New York. See Gliklad
v. Bank Hapoalim B.M., No. 155195/2014, 2014 N.Y. Slip Op. 32117(U), at *3 (Sup. Ct. N.Y.
Cnty. Aug. 4, 2014). In fact, the Second Circuit drew no such distinction when applying
Daimler to the facts in Brown, which involved Lockheed’s maintenance of offices and a facility
in Connecticut. See Brown, 2016 WL 641392, at *6-7. Accordingly, Daimler is controlling here
and clearly precludes the Court from exercising general jurisdiction over Defendant in this
Specific Jurisdiction Under Rule 4(k)(1)(A)
Rule 4(k)(1)(A) of the Federal Rules of Civil Procedure permits a federal court to
“exercise personal jurisdiction to the extent of the applicable [State] statutes.” Peterson v.
Islamic Republic of Iran, 2013 WL 1155576, at *11 (S.D.N.Y. Mar. 13, 2013), aff’d 758 F.3d
185 (2d Cir. 2014) (citing Fed. R. Civ. P. 4(k)(1)(A)). Under this rule, a federal court may look
to the long-arm statute of the State in which it sits to establish a statutory basis for the exercise of
personal jurisdiction over a defendant. Here, Plaintiffs invoke several provisions of New York’s
long-arm statute, alleging that Defendant is subject to specific jurisdiction under New York Civil
Practice Law and Rules (“C.P.L.R.”) §§ 302(a)(1), (a)(2), and (a)(3). (See Pl.s’ Opp’n at 22-25.)
Because the Court concludes that C.P.L.R. § 302(a)(1) (“§ 302(a)(1)”) permits the exercise of
jurisdiction over Defendant, it does not consider whether jurisdiction also exists under §§
302(a)(2) and (3).
CPLR § 302(a)(1)
Pursuant to § 302(a)(1), a court may exercise personal jurisdiction over a non-domiciliary
that “transacts any business within the state.” N.Y. C.P.L.R. § 302(a)(1). This provision confers
jurisdiction over a defendant if two requirements are met. First, the defendant must have
transacted business in New York. Known as the “purposeful availment” prong of § 302(a)(1),
this requirement calls for a showing that the defendant “purposefully avail[ed] itself of the
privilege of conducting activities within New York . . . thereby invoking the benefits and
protections of its laws.” Id. at 61 (internal quotation marks and citations omitted). The second
requirement, known as the “nexus” prong of § 302(a)(1), holds that there must be an “articulable
nexus” or “substantial relationship” between the plaintiff’s claim and the defendant’s transaction
in New York. See Best Van Lines, Inc. v. Walker, 490 F.3d 239, 246 (2d Cir. 2007) (quoting
Henderson v. INS, 157 F.3d 106, 123 (2d Cir. 1998)).
In Licci v. Lebanese Canadian Bank, SAL (“Licci II”), 20 N.Y.3d 327 (2012), the New
York Court of Appeals (“Court of Appeals”) answered questions certified from the Second
Circuit concerning the reach of § 302(a)(1) in the context of an action, like the instant one,
alleging that a foreign bank violated the ATA by knowingly transferring funds that supported an
FTO. Notably, the defendant bank in question “did not operate branches or offices, or maintain
employees, in the United States.” Id. at 332. Nevertheless, the Court of Appeals held that the
bank transacted business in New York by executing dozens of wire transfers through a
correspondent bank account in New York on behalf of an entity that allegedly served as the
financial arm of an FTO. As the Court of Appeals explained: “[A] foreign bank’s repeated use
of a correspondent account in New York on behalf of a client—in effect, a course of dealing—
show[s] purposeful availment of New York’s dependable and transparent banking system, the
dollar as a stable and fungible currency, and the predictable jurisdictional and commercial law of
New York and the United States.” Id. at 339 (internal quotations marks and citation omitted).
The Court of Appeals further explained that the nexus prong of § 302(a)(1) does not
demand a causal connection between the defendant’s New York transaction the plaintiff’s claim,
but instead requires only a “relatedness . . . such that the latter is not completely unmoored from
the former.” Id. at 339. This “relatively permissive” nexus is satisfied where “at least one
element [of the plaintiff’s claim] arises from the [defendant’s] New York contacts.” Id. at 339,
341. The Court of Appeals held that this requisite nexus was established in Licci II because the
defendant bank, in utilizing a correspondent account in New York allegedly to send money to a
terrorist organization, purportedly violated the very statutes under which the plaintiffs sued. Id.
at 340. Furthermore, the bank did not direct those funds through New York “once or twice by
mistake,” but deliberately and repeatedly used a New York account allegedly to support the same
terrorist organization accused of perpetrating the attacks in which the plaintiffs were injured. Id.
Turning to the instant action, Defendant’s relevant New York conduct is even more
substantial and sustained than that of the foreign bank in the Licci cases (collectively, “Licci”).
Whereas the bank in Licci maintained only a correspondent account as its sole point of contact in
New York, Defendant had a New York Branch that was staffed with employees and licensed to
operate under New York banking laws. Defendant routinely conducted business in New York
through that branch, utilizing it as the exclusive clearing channel for U.S. Dollar transfers
requested by its customers. (See Virgilio Decl. ¶ 2; see also Tr. 20:22-21:6). In doing so,
Defendant necessarily availed itself of the benefits and protections accorded to such transactions
when carried out using New York’s dependable banking system, under the auspices of New
York banking and commercial laws. See Licci II, 20 N.Y.3d at 339-40. These facts satisfy the
purposeful availment prong of § 302(a)(1).
With respect to the nexus prong of § 302(a)(1), the relevant facts further demonstrate a
close relatedness between Plaintiffs’ claims in this action and Defendant’s New York conduct.
Most significantly, in executing the New York Transfers, Defendant allegedly used New York’s
banking system to effect the very financial support of Hamas that is the basis for Plaintiffs’
claims. While those five transfers represent only a subset of the total transfers Defendant made
to the Charities on behalf of CBSP, they integrally constitute part of Defendant’s alleged support
of Hamas and its terrorist activities, including the 19 attacks in which Plaintiffs were injured. As
such, the New York Transfers unquestionably are among the financial services underlying
Plaintiffs’ claims. (See Strauss FAC ¶¶ 676-90; Wolf Compl. ¶¶ 407-25.)
That nexus would be too attenuated if, contrary to the facts alleged here, Defendant
routed transfers through New York just “once or twice by mistake,” or executed the New York
Transfers at a time far removed from the attacks that caused Plaintiffs’ injuries. Licci II, 20
N.Y.3d at 340. However, five separate times, Defendant deliberately routed a transfer through
its New York Branch in response to a specific request by CBSP to transmit funds in U.S. Dollars
to a given Charity. Furthermore, the first New York Transfer occurred in 1997, while the
remaining four transfers all were performed in June and July of 2001. (See Ex. A to the Oct. 16,
2015 Friedman Ltr.) As such, those transfers not only overlapped with the attacks in 2001
through 2004 that caused Plaintiffs’ injuries, but also occurred at a time when Defendant
allegedly knew that funds it transferred on behalf of CBSP were being used to support a terrorist
organization. (See, e.g., Strauss Compl. ¶ 678; Wolf Compl. ¶ 419); see also Strauss II, 925 F.
Supp. 2d at 429-430 (noting that “Defendant admittedly had concerns about CBSP’s accounts
since at least 1997,” and further finding that “there is considerable documentary and testimonial
evidence showing Defendant’s knowledge of CBSP’s possible terrorist affiliations from at least
2001 through 2003, which is contemporaneous to the attacks at issue.”)
Defendant nevertheless argues that the nexus required by § 302(a)(1) is foreclosed
because Plaintiffs have not proven with respect to any New York Transfer that the beneficiary
Charity actually received and took possession of the underlying funds. (See Def.’s Mem. at 1011.) However, it is not Plaintiffs’ burden to adduce any such proof at this stage. Rather,
Plaintiffs need only plead facts that, if credited, would establish jurisdiction over Defendant. See
Metro. Life, 84 F.3d at 567. Plaintiffs have done so, having relied not only on an averment of
facts but also on actual transfer records showing that each New York Transfer was directed to a
beneficiary Charity, was routed by Defendant through its New York Branch, and reached a
correspondent account in New York maintained by the respective Charity’s bank. (See Ex. B. to
the Oct. 16, 2015 Osen Ltr.)
Defendant further argues that, even if each New York Transfer reached its intended
beneficiary, those transfers do not support jurisdiction because they are de minimis in
comparison to the many other transfers Defendant made to the Charities at CBSP’s behest. The
parties generally agree that, in addition to the five New York Transfers, Defendant executed at
least 280 other transfers to the Charities on behalf of CBSP that never went through New York
or the United States. (See Oct. 20, 2015 Osen Ltr., Strauss Dkt. Entry No. 395.) Furthermore,
whereas the New York Transfers represented just $205,000 in transferred funds, the other
relevant transfers routed elsewhere in the world totaled approximately $3 million. (See Oct. 16,
2015 Osen Ltr.) Accordingly, whether measured by number or monetary value, the vast majority
of the transfers underlying Plaintiffs’ claims were routed from CBSP’s accounts in Paris to
various bank accounts abroad, without any contact with New York or the United States.
While relevant to the Court’s jurisdictional analysis, these facts do not foreclose
jurisdiction under § 302(a)(1). As a “single act statute,” even “one transaction in New York is
sufficient to invoke jurisdiction [under § 302(a)(1)] . . . so long as the defendant’s activities here
were purposeful and there is a substantial relationship between the transaction and the claim
asserted.” Deutsche Bank Secs., Inc., v. Montana Bd. of Invs., 7 N.Y.3d 65, 71 (2006) (internal
quotation marks and citation omitted); see also Chloé, 616 F.3d at 170; Kreutter v. McFadden
Oil Corp., 71 N.Y.2d 460, 467 (1988). In number, the New York Transfers accounted for
approximately 1.8% of the total transfers Defendant made to the Charities on behalf of CBSP.
(See Oct. 21, 2015 Friedman Ltr., Strauss Dkt. Entry No. 396). Defendant notes that a similar
percentage of New York activity was deemed de minimis in DH Services, LLC v. Positive
Impact, Inc., 2014 WL 496875, at *9-10 (S.D.N.Y. Feb. 5, 2014), where the court found that it
could not exercise jurisdiction over an out-of-state organization that received approximately 1%
of its annual funding from New York sources.8
However, the court further explained that the grants and donations composing that 1% of
The Court notes that Defendant makes an apples-to-oranges comparison. In DH Services, 1% represented the
proportional value of funds received from New York sources, whereas in this case 1.8% represents the proportional
number of transfers executed through New York. Expressed in terms of value, and based on the figures generally
agreed upon by the parties, the New York Transfers may have represented as much as 6.8% of the total funds
Defendant transferred to the Charities on behalf of CBSP.
funding had no demonstrated connection to the trademark claims that were the subject of the
action. Id. at *9. The court sharply contrasted Chloé, 616 F.3d at 166, where the Second Circuit
held that a defendant who shipped a single counterfeit handbag into New York was subject to
jurisdiction under § 302(a)(1) because that “was the conduct underlying the lawsuit.” DH
Services, 2014 WL 496875, at *9 (emphasis in original).
Here, although the New York
Transfers represent a minority of the total transfers Defendant made to the Charities on behalf of
CBSP, they are an integral facet of the conduct that is the basis for all of Plaintiffs’ claims.
Thus, similar to the facts in Chloé, the New York Transfers are the conduct underlying this
lawsuit. As such, they establish the articulable nexus required by § 302(a)(1).
Furthermore, the nexus between Plaintiffs’ claims and Defendant’s New York conduct is
premised on more than just the New York Transfers. As an element of their claims, “Plaintiffs
must show that Defendant knew or was deliberately indifferent to the fact that CBSP was
financially supporting terrorist organizations.” Strauss II, 925 F. Supp. 2d at 428. According to
Plaintiffs, what Defendant knew about CBSP’s potential involvement in financing terrorism was
informed, at least in part, by Defendant’s communications and other interactions with the New
York Branch. In particular, consistent with its general practice, Defendant’s New York Branch
filtered all transfer requests made by CBSP through a system designed to detect terrorism
financing based on notices from the United States Treasury Office of Foreign Asset Control
(“OFAC”). (See Virgilio Decl. ¶ 3.) In October 2001, the New York Branch blocked a transfer
from CBSP’s main account in Paris to the “El Wafa Charitable Society-Gaza” (the “El Wafa
Transfer”), as that organization’s name was similar to the name of an organization designated by
OFAC as an Al Qaeda fundraiser. (See Id. ¶¶ 2-4.) Ultimately, those two organizations were
determined to be distinct. As such, the New York Branch’s blocking of the El Wafa Transfer, by
itself, provides limited insight into what Defendant potentially knew about CBSP’s involvement
in financing terrorism. See Strauss II, 925 F. Supp. 2d at 430 n.10.
Nevertheless, Plaintiffs allege that the blocking of the El Wafa Transfer precipitated
communications between Defendant and its New York Branch regarding CBSP’s banking
activities. (See Ex. A to the Oct. 22, 2015 Osen Ltr., Strauss Dkt. Entry No. 397) (attaching list
Those communications, in turn, allegedly renewed suspicions at
Defendant’s home office in Paris regarding CBSP, and led to discussions among bank officials
there regarding stricter scrutiny of CBSP’s accounts. (See Pl.s’ Opp’n at 13 & n.29.) Defendant
nonetheless contends that those communications, potentially implicating what Defendant knew
about CBSP’s ties to terrorism, are not relevant to the Court’s jurisdictional analysis under §
302(a)(1) because they do not give rise to Plaintiffs’ claims. (See Def.’s Reply Mem. in Supp. of
Mot. to Dismiss (“Def.’s Reply”) at 3, Strauss Dkt. Entry No. 372.)
However, Defendant too narrowly construes the nexus requirement of § 302(a)(1). The
defendant in Chloé similarly misconstrued that requirement, arguing that counterfeit bags it
shipped into New York bearing marks not registered to the plaintiff were irrelevant to a
jurisdictional analysis, as the plaintiff’s trademark claims necessarily did not arise from those
particular shipments. The Second Circuit rejected that argument on appeal, explaining that those
shipments were relevant to an analysis under § 302(a)(1) because they evidenced a “larger
business plan purposefully directed at New York.” Chloé, 616 F.3d at 166-67. With the benefit
of that broader context, the shipment of a single bag into New York bearing the plaintiff’s marks
was not the “one-off transaction” it otherwise appeared to be. Id. Here, the blocking of the El
Wafa Transfer and the ensuing communications between the New York Branch and bank
officials at Defendant’s home office in Paris similarly evidence a broader operation
fundamentally intertwined with New York. Standing alone, that relationship perhaps would not
be enough to establish the nexus required by § 302(a)(1). However, those interactions give
deeper context to the New York Transfers, demonstrating that Plaintiffs’ claims are tied to New
York by more than just those five transactions.
In any event, jurisdiction under § 302(a)(1) is not determined by the quantity of a
defendant’s contacts with New York, but by the quality of those contacts when viewed in the
totality of the circumstances. Fischbarg v. Doucet, 9 N.Y.3d 375, 380 (2007); Farkas v. Farkas,
36 A.D.3d 852, 853 (2d Dep’t 2007). Here, Defendant had a New York Branch through which it
continuously and systematically conducted business in New York, utilizing that branch to
execute U.S. Dollar transfers requested by its customers. Whatever efficiency and cost savings
Defendant gained as a result allowed Defendant to retain relationships with customers that had a
need to deal in U.S. currency, a contingent that from time to time included CBSP. Most
importantly, Defendant executed the five New York Transfers through the New York Branch,
repeatedly and deliberately using New York’s banking system to effect the alleged financial
support of Hamas that is the basis for Plaintiffs’ claims. Given the quality of those contacts and
their close connection to New York, the Court concludes that § 302(a)(1) permits the exercise of
jurisdiction over Defendant.
Scope Of Jurisdiction Under § 302(a)(1)
A plaintiff must establish personal jurisdiction with respect to each claim asserted. See
Sunward Elecs., Inc. v. McDonald, 362 F.3d 17, 24 (2d Cir. 2004). Invoking this principle,
Defendant argues that each Plaintiff in this action asserts a claim under the ATA separately and
individually, and that jurisdiction must be established uniquely for each one of these claims.
(See Def.’s Reply at 5.) Plaintiffs argue otherwise, essentially contending that they assert a
“claim” under the ATA, and that a single New York contact that would support the exercise of
specific jurisdiction is sufficient to confer jurisdiction over that entire claim. (See, e.g., Tr. 55:110.)
Because Plaintiffs allege injuries in connection with 19 different attacks, each associated
with a distinct class of Plaintiffs, the Court disagrees that all of their claims can be aggregated
into a single, unitary claim under the ATA for purposes of establishing specific jurisdiction.
Even so, the Court concludes that Defendant is subject to jurisdiction under § 302(a)(1) with
respect to claims made in connection with all 19 attacks. To explain why, it is useful to consider
the result if Plaintiffs had pursued their claims in 19 separate actions, each premised upon a
single attack. As previously noted, the first New York Transfer was in 1997 and the remaining
four transfers all occurred in June and July of 2001, while the 19 attacks at issue in this action all
took place between March 2001 and September 2004. (See Ex. A to the Oct. 16, 2015 Friedman
Ltr.) Given the timing of those transfers and the substantial amount underlying them, Plaintiffs
in all 19 actions legitimately could rely upon the New York Transfers as among the financial
services and material support allegedly provided by Defendant in violation of the ATA.
That conceivably would not be the case if, for instance, one of the attacks for which
Plaintiffs sought recovery occurred in 1992, five years before the first New York Transfer.
Under such circumstances, the nexus between claims arising from the 1992 attack and a series of
transfers that did not even begin to occur until five years later theoretically would be too
attenuated to support jurisdiction under § 302(a)(1). See, e.g., Standard Chartered Bank v.
Ahmad Hamad Al Gosaibi & Bros. Co., No. 653506/2011, 2013 N.Y. Slip. Op. 32312(U), at *35 (Sup. Ct. N.Y. Cnty. Sept. 24, 2013) (nexus required under § 302(a)(1) not satisfied where
2009 default could not have arisen from business the defendant transacted in New York in 2010
and thereafter). However, those are not the facts here. Even assuming that Plaintiffs had
pursued their claims in 19 separate actions, the New York Transfers would embody purportedly
unlawful conduct relevant to establishing Defendant’s liability in each action.9 As such, the
claims in each action could be said to arise, at least in part, from the New York Transfers, in
which case § 302(a)(1) would confer jurisdiction over Defendant in each action. See Licci II, 20
N.Y.3d at 341.
Nevertheless, Defendant contends that the scope of jurisdiction the Court may exercise in
this action, where Plaintiffs assert their claims collectively, is narrower and does not permit
adjudication of all of Plaintiffs’ claims. Defendant’s position rests on the assumption that, if the
Court were to adjudicate all of those claims, it necessarily would be exercising specific
jurisdiction not only with respect to the New York Transfers, but also with respect to numerous
other transfers that never touched New York or the United States. (See Def.’s Mem. at 8-10)
(“This Court cannot treat [Defendant’s] discrete wire transfers that touched New York as
providing a basis for asserting personal jurisdiction over [Defendant] in New York with respect
to transfers that never touched the United States.”)
According to Defendant, exercising
jurisdiction over the latter category of transfers is impermissible in a “specific jurisdiction
universe” because those transfers, which were not routed through the New York Branch, have no
connection to Defendant’s New York conduct.
Defendant’s argument is fundamentally flawed, however, as it erroneously assumes that
Defendant notes that one of the attacks at issue occurred on March 28, 2001, at which point the only New York
Transfer that had been executed was a 1997 transfer in the amount of $5,000. (See Def.’s Mem. at 23.) According
to Defendant, the four remaining New York transfers necessarily could not have proximately caused that attack
because they were performed after it occurred, in June and July of 2001. That argument presents a question of
causation not appropriately resolved here, but the Court notes that the Honorable Brian M. Cogan, of this Court,
recently rejected the very same argument in denying the defendant’s post-trial motions in Linde v. Arab Bank, PLC,
97 F. Supp. 3d 287, 329 (E.D.N.Y. 2015). As Judge Cogan explained: “Defendant's emphasis on the fact that these
payments were made after the attacks occurred misses the point; the jury was entitled to find that the prospect that
the families of dead Hamas terrorists would be financially rewarded was a substantial factor in increasing Hamas'
ability to carry out attacks such as these.” Id.
the Court’s adjudicatory power over Defendant is defined according to which individual
transfers satisfy the jurisdictional requirements of § 302(a)(1), rather than which claims satisfy
those requirements. In fact, the two are distinct. Plaintiffs’ claims are that Defendant violated
the ATA, causing injury, by providing material support to an FTO and knowingly financing
terrorism. See 18 U.S.C. §§ 2339B and 2339C. Those claims do not necessarily correspond
one-to-one with particular transfers, but instead rest upon the millions of dollars Defendant
allegedly transferred to Hamas front organizations in close temporal proximity to the 19 attacks
in which Plaintiffs were injured. Because the New York Transfers were part of that allegedly
unlawful conduct, the Court may exercise jurisdiction with respect to claims made in connection
with all 19 attacks.
This is true notwithstanding the fact that those claims also may arise from other transfers
Defendant did not route through New York, including ones performed after the last of the New
York Transfers was executed in July 2001.10 There is no requirement under § 302(a)(1) that a
plaintiff’s claim must arise exclusively from New York conduct. To the contrary, as long as
there is a relatedness between a plaintiff’s claim and the defendant’s New York transaction, §
302(a)(1) confers jurisdiction even if some, or all, of the acts constituting the breach sued upon
occurred outside New York. See Hoffritz for Cutlery, Inc. v. Amajac Ltd., 763 F.2d 55, 59 (2d
Cir. 1985) (applying § 302(a)(1) and rejecting the district court’s “finding of no jurisdiction over
defendants merely on the basis that the acts alleged in the complaint did not take place in New
For this reason, the Court rejects Defendant’s argument that Plaintiffs should be required to prove their claims
based on the state of affairs, and what Defendant knew, as of the date of the last New York Transfer. (See Def.’s
Mem. at 10-11.) That argument is premised on the fallacy that the Court only may exercise jurisdiction over the
individual New York Transfers, which uniquely give rise to specific claims that are not premised on any other
transfers. That is not the case, however, as all of Plaintiffs’ claims arise more broadly from the many transfers
Defendant made to the Charities during the relevant timeframe, of which the New York Transfers were a part.
Moreover, the Court unequivocally rejects Defendant’s unsupported contention that personal jurisdiction limits the
evidence Plaintiffs may use to prove their claims, confining it just to what existed at the time of the last New York
York.”); Hedlund v. Products from Sweden, Inc., 698 F. Supp. 1087, 1091-93 (S.D.N.Y.1988)
(finding defendant subject to jurisdiction in New York under § 302(a)(1) with respect to a claim
of tortious interference that arose from conduct in Sweden). Thus, even if Defendant’s conduct
outside New York substantially gave rise to Plaintiffs’ claims, and outweighs Defendant’s
relevant New York conduct, Plaintiffs’ claims still are within the permissible scope of
jurisdiction under § 302(a)(1) because they are all “sufficiently related to the business transacted
[in New York] that it would not be unfair . . . to subject [Defendant] to suit in New York.”
Hoffritz, 763 F.2d at 59.
The Court is not persuaded that a different result is compelled by Fontanetta v. American
Board of Internal Medicine, 421 F.2d 355 (2d Cir. 1970), a case Defendant heavily relies upon
even though it was decided 45 years ago without the benefit of clear precedent from the New
York courts regarding how § 302(a)(1) should be applied.
See Hoffritz, 763 F.2d at 61.
Fontanetta involved a physician who sought certification as an internist from the American
Board of Internal Medicine, which required passing both an oral and written exam.
Fontanetta, 421 F.2d at 356. The physician passed the written exam in New York in 1963, but
twice failed the oral exam—once in Philadelphia, Pennsylvania in 1965, and once in St. Louis,
Missouri in 1967. Id. After he failed the oral exam for a second time, the physician brought suit
in New York to compel the Board to disclose the reasons why he had failed the two oral exams,
and to issue the requested certification. Id. Applying § 302(a)(1), the Second Circuit held that
the physician’s claim, which concerned only the oral exam, was not sufficiently related to the
written exam to sustain jurisdiction in New York. Id. at 357-58. As the Second Circuit later
explained in Hoffritz: “We held [in Fontanetta] that the substantive differences between the two
kinds of examination, together with the separation both in time and geographic location of the
oral examination from the written examination, rendered unrealistic a view of the two as one
unit.” Hoffritz, 763 F.2d at 61.
Here, while the transfers at issue vary in time and location to a degree, substantively they
constitute a single course of conduct by Defendant that purportedly entailed violations of the
same statute in the same manner with respect to all of Plaintiffs’ claims. Moreover, whereas in
Fontanetta the plaintiff’s claim did not relate to the written examination, the Court already has
determined the all of Plaintiffs’ claims in this action relate to the New York Transfers. See Id. at
61-62 (similarly distinguishing Fontanetta and holding that jurisdiction existed under § 302(a)(1)
with respect to a claim “sufficiently connected to defendants’ transaction of business in New
York.”) As such, the Court’s finding that it may exercise jurisdiction with respect to all of
Plaintiffs’ claims is not inconsistent with Fontanetta.
Defendant’s reliance on State v. Samaritan Asset Management Services, Inc., 22 Misc.3d
669 (Sup. Ct. N.Y. Cnty. 2008), similarly is unavailing. There, the New York Attorney General
brought a securities fraud action against the defendants under the State’s Martin Act, N.Y. Gen.
Bus. Law § 352 et. seq. The court dismissed the action in part, holding that it could exercise
personal jurisdiction with respect to trades the defendants executed through New York brokers,
but not with respect to trades executed through a trust company located in Phoenix, Arizona. Id.
at 676-77. However, that holding substantially was a consequence of the territorial limitations of
the Martin Act, which applies exclusively to acts “within and from” New York. See Id. at 674,
676-77. No such limitation binds the Court here. To the contrary, the ATA expressly is directed
at terrorist activities that “occur primarily outside the territorial jurisdiction of the United States.”
18 U.S.C. § 2331(1). Indeed, the very purpose of the ATA was to “provide a new civil cause of
action in Federal law for international terrorism that provides extraterritorial jurisdiction over
terrorist acts abroad against United States nationals.” In re September 11 Litig., 751 F.3d 86, 93
(2d Cir. 2014) (quoting H.R. 2222, 102d Cong. (1992)) (internal quotation marks omitted).
While these are concepts of territorial jurisdiction, not personal jurisdiction, they distinguish
Samaritan and render it inapposite here.
Jurisdiction Under Rule 4(k)(1)(C)
Plaintiffs argue that Rule 4(k)(1)(C) of the Federal Rules of Civil Procedure provides an
additional statutory basis for the Court to exercise personal jurisdiction over Defendant. The
Court agrees. Under Rule 4(k)(1)(C), personal jurisdiction may be established through proper
service of process upon a defendant pursuant to a federal statute that contains its own service
provision. See Fed. R. Civ. P. 4(k)(1)(C) (“Serving a summons or filing a waiver of service
establishes personal jurisdiction over a defendant . . . when authorized by a federal statute.”); see
also 4B Wright & Miller et al., Federal Practice & Procedure § 1125 (4th ed.) As relevant here,
the ATA expressly authorizes nationwide service of process, thereby establishing personal
jurisdiction over a defendant properly served under the statute.11
Here, Defendant does not dispute that it properly was served with process at its agency
in Miami, Florida in connection with the original filing of this action in the District of New
Jersey. (See Ex. A to the Declaration of Aaron Schlanger, dated May 1, 2014 (“Schlanger
Decl.”), Strauss Dkt. Entry No. 370.) Furthermore, when the Strauss action was refiled in this
Court, Defendant expressly agreed to accept service of the Summons and Complaint by
See 18 U.S.C. § 2334 (providing for nationwide service of process “where[ever] the defendant resides, is found,
or has an agent”); Licci I, 673 F.3d at 59 n.8 (2d Cir. 2012) (acknowledging the ATA’s nationwide service of
process provision as a possible basis for personal jurisdiction); Stansell v. BGP, Inc., 2011 WL 1296881, at *3
(M.D. Fla. Mar. 31, 2011); Sokolow v. Palestine Liberation Org., 2011 WL 1345086, at *2 (S.D.N.Y. Mar. 30,
2011); Wultz v. Islamic Republic of Iran (“Wultz I”), 755 F. Supp. 2d 1, 31-32 (D.D.C. 2010); In re Terrorist
Attacks on Sept. 11, 2001, 349 F. Supp. 2d 765, 806-07 (S.D.N.Y. 2005); see also IUE AFL-CIO Pension Fund v.
Hermann, 9 F.3d 1049, 1056 (2d Cir. 1993) (federal statute authorizing nationwide service of process may be used
to establish personal jurisdiction).
stipulation of the parties dated February 17, 2006.12
(See Ex. B to the Schlanger Decl.)
Defendant voluntarily accepted service in the Wolf action as well. (See Stipulation and Order
dated April 5, 2007, Wolf Dkt. Entry No. 6.) As such, Rule 4(k)(1)(C) provides an additional
basis for this Court to exercise personal jurisdiction over Defendant, to the extent permitted by
See In re Terrorist Attacks, 349 F. Supp. 2d at 806 (exercise of personal
jurisdiction pursuant to Rule 4(k)(1)(C) still requires demonstration that defendant has sufficient
“minimum contacts” to satisfy traditional due process inquiry); see also Wultz I, 755 F. Supp. 2d
at 32 (“Nationwide service of process does not dispense with the requirement that an exercise of
personal jurisdiction comport with the Due Process Clause.”)
Constitutional Due Process
Having concluded that there is a statutory basis to exercise personal jurisdiction over
Defendant, the Court must consider whether exercising such jurisdiction would comport with the
due process protections provided by the United States Constitution. As articulated by the
Supreme Court in International Shoe, the touchstone due process principle requires that the
defendant “have certain minimum contacts [with the forum state] such that maintenance of the
suit does not offend traditional notions of fair play and substantial justice.” Licci ex rel. Licci v.
Lebanese Canadian Bank, SAL (“Licci III”), 732 F.3d 161, 169 (2d Cir. 2013) (quoting Int’l
Shoe, 326 U.S. at 316) (alterations in original). Assuming the threshold showing of “minimum
contacts” is satisfied, the Court also must consider whether its exercise of jurisdiction would be
At the time Defendant accepted service, the provision presently embodied by Rule 4(k)(1)(C) of the Federal
Rules of Civil Procedure was in effect as Rule 4(k)(1)(D), which subsequently was renumbered pursuant to the 2007
Amendment to the Federal Rules.
In Wultz v. Republic of Iran (“Wultz II”), 762 F. Supp. 2d 18, 25-29 (D.D.C. 2011), the district court held that the
ATA’s nationwide service of process provision cannot be invoked to establish personal jurisdiction unless the first
clause of that provision, concerning proper venue under the statute, also is satisfied. Here, Defendant has waived
any argument that venue is improper by failing to raise that issue. In any event, given that the ATA provides for
venue in any district where any plaintiff resides or where the defendant is served, the Court would find that venue is
proper in this district even if Defendant had asserted a challenge. See 18 U.S.C. § 2334(a).
reasonable under the circumstances. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-77
(1985); see also Licci III, 732 F.3d at 173-74.
Notably, after the Court of Appeals determined in Licci II that the defendant bank was
subject to jurisdiction in New York under § 302(a)(1), the Second Circuit in Licci III considered
whether exercising such jurisdiction would comport with due process. In concluding that due
process was satisfied, the Second Circuit observed that it would be “rare” and “unusual” for a
court to determine that the exercise of personal jurisdiction over a defendant was permitted by §
302(a)(1), but prohibited under principles of due process. Licci III, 732 F.3d at 170. In fact, the
Second Circuit noted that it was aware of no such decisions within this Circuit. Id. Therefore,
given the Court’s prior determination that § 302(a)(1) permits the exercise of jurisdiction over
Defendant, it would be unusual, and even unprecedented, for the Court to find that due process is
not satisfied here.
Where, as here, a court’s specific jurisdiction is invoked, “minimum contacts” sufficient
to satisfy due process exist if “the defendant purposefully availed itself of the privilege of doing
business in the forum and could foresee being haled into court there.” Licci III, 732 F.3d at 170
(quoting Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 305 F.3d 120, 127 (2d Cir.
2002)) Courts typically conduct this inquiry under two separate prongs: (1) the “purposeful
availment” prong, “whereby the court determines whether the entity deliberately directed its
conduct at the forum”; and (2) the “relatedness” prong, “whereby the court determines whether
the controversy at issue arose out of or related to the entity’s in-forum conduct.” Gucci Am., Inc.
v. Weixing Li (“Gucci III”), 2015 WL 5707135, at *7 (S.D.N.Y. Sept. 29, 2015) (citing Chew v.
Dietrich, 143 F.3d 24, 27-29 (2d Cir. 1998)).
Because this action arises under the ATA, a nationwide service of process statute, the
appropriate “minimum contacts” inquiry is whether Defendant has sufficient contacts with the
United States as a whole.14 Nevertheless, aside from an office Defendant purportedly maintains
in Miami, Florida, essentially all of the contacts relevant to the Court’s due process inquiry
involve Defendant’s conduct in New York.
Moreover, having already determined that
Defendant’s New York conduct satisfies the purposeful availment prong of § 302(a)(1), the
Court has little difficulty concluding that it similarly demonstrates purposeful availment
sufficient to establish “minimum contacts” with the United States. See Licci III, 732 F.3d at 170.
There is nothing remotely “random, isolated, or fortuitous” about that conduct that would call
into question whether it was purposefully directed at the United States. Id. at 171 (quoting
Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 774 (1984)). Defendant had a New York
Branch and systematically utilized that branch as its exclusive clearing channel for U.S. Dollar
transfers requested by its customers. Defendant’s officers in Paris also regularly communicated
with the New York Branch, including with regard to CBSP on several occasions. (See Ex. A to
the Oct. 22, 2015 Osen Ltr.) (attaching list of communications).
Most notably, Defendant deliberately used New York’s banking system to execute the
five New York Transfers. Given that similar recurring transfers routed through a New York
correspondent account were sufficient to establish purposeful availment in Licci III, the New
York Transfers demonstrate such availment a fortiori because they were executed through
Defendant’s own branch in New York.
As such, there is no question that Defendant
See LIBOR, 2015 WL 4634541, at *18; Wultz II, 762 F. Supp. 2d at 25; In re Terrorist Attacks, 349 F. Supp. 2d at
806 (Where jurisdiction is asserted under the ATA’s service provision, the “relevant inquiry under such
circumstances is whether the defendant has minimum contacts with the United States as a whole [to satisfy Fifth
Amendment due process requirements], rather than . . . with the particular state in which the federal court sits.”)
(quoting Estates of Ungar ex rel. Strachman v. Palestinian Auth., 153 F. Supp. 2d 76, 87 (D.R.I. 2001)) (alterations
in original). But see Gucci II, 768 F.3d at 142 n.21 (noting that the Second Circuit has not yet decided whether the
“national contacts” approach is proper for determining personal jurisdiction in cases arising under federal statutes
that authorize nationwide service.)
purposefully availed itself of the “privilege of conducting business in [New York],” thereby
subjecting itself to suit in the United States with respect to any and all claims substantially
related to such conduct. Licci III, 732 F.3d at 171 (quoting Bank Brussels Lambert, 305 F.3d at
127); see also Gucci III, 2015 WL 5707135, at *8.
Turning to the question of relatedness, the Second Circuit held in Licci III that the
defendant bank’s use of an in-forum correspondent account to execute the very wire transfers
that were the basis for the plaintiffs’ claims satisfied “minimum contacts.” As the Second
[W]e by no means suggest that a foreign defendant’s ‘mere maintenance’ of a
correspondent account in the United States is sufficient to support the
constitutional exercise of personal jurisdiction over the account-holder in
connection with any controversy. In this case, the correspondent account at issue
is alleged to have been used as an instrument to achieve the very wrong alleged.
We conclude that in connection with this particular jurisdictional controversy—a
lawsuit seeking redress for the allegedly unlawful provision of banking services
of which the wire transfers are a part—allegations of [the defendant’s] repeated,
intentional execution of U.S.-dollar-denominated wire transfers on behalf of
Shahid, in order to further Hizballah's terrorist goals, are sufficient [to sustain
Licci III, 732 F.3d at 171. The same conclusion is compelled here, where the New York
Transfers are among the allegedly unlawful financial services Defendant provided to CBSP for
which Plaintiffs seek redress in this action.
Defendant attempts to distinguish Licci III on the ground that all of the wire transfers at
issue in that case were routed through New York, whereas in this case only a fraction of the
transfers at issue contacted New York. However, in Licci III, the Second Circuit did not hold, or
even suggest, that due process was satisfied because the transfers at issue were routed exclusively
through New York. That fact was not even made explicit in the Second Circuit’s opinion.
Rather, per the Second Circuit’s express holding, “minimum contacts” were established by the
defendant bank’s repeated and deliberate use of a New York correspondent account to effect the
financial services underlying the plaintiffs’ claims. See Id. at 171-73; Wultz I, 755 F. Supp. 2d at
34 (suggesting that a single wire transfer knowingly performed in the U.S. for the benefit of a
terrorist organization could support a finding of specific jurisdiction in the ATA context); see
also Burger King, 471 U.S. at 475 n.18 (“So long as it creates a substantial connection with the
forum, even a single act can support jurisdiction.”) (internal quotation marks and citation
omitted). The facts alleged here demonstrate the same repeated and deliberate conduct by
The Court acknowledges that Licci III involved dozens of wire transfers through New
York totaling millions of dollars, whereas in this case there were only five New York Transfers
totaling $205,000. Nevertheless, if not for the New York Transfers, $205,000 would not have
been provided to the Charities and thereupon purportedly delivered into the hands of Hamas
during the same timeframe that Hamas allegedly carried out the attacks in which Plaintiffs were
injured. Contra 7 West 57th St., 2015 WL 1514539, at *10 (“minimum contacts” not satisfied in
LIBOR fixing case because defendant bank’s conduct in New York had no alleged connection
with plaintiff’s injury and did not even occur during the relevant timeframe). Furthermore,
Plaintiffs allege facts to support a finding that Defendant executed the New York Transfers at a
time when it knew, or at least suspected, that it was supporting a terrorist organization by
sending money from CBSP to the Charities. See Strauss, 925 F. Supp. 2d at 429-30; cf. Wultz I,
755 F. Supp. 2d at 34 (“Where a bank has knowledge that it is funding terrorists . . . contacts
created by such funding can support such a finding [of specific jurisdiction].”) (citing In re
Terrorist Attacks on Sept. 11, 2001, 718 F. Supp. 2d 456, 488-90 (S.D.N.Y. 2010)). Under Licci
III, these factual assertions are sufficient to satisfy the “minimum contacts” component of the
due process inquiry.
For the reasons discussed by the Court when analyzing the scope of jurisdiction under §
302(a)(1), supra, the Court further concludes that Defendant’s New York conduct established
“minimum contacts” as to which all of Plaintiffs’ claims substantially relate. As such, the Court
finds that it may exercise jurisdiction over Defendant with respect to all of those claims without
offending due process. See Walden, 134 S. Ct. at 1121 (“minimum contacts” satisfied if “the
defendant’s suit-related conduct . . . create[s] a substantial connection with the forum State.”).
Furthermore, as acknowledged by the Second Circuit, there is authority for the “general
proposition that use of a forum’s banking system as part of an allegedly wrongful course of
conduct may expose the user to suits seeking redress in that forum when that use is an integral
part of the wrongful conduct.” Licci III, 732 F.3d at 172 n.7. Here, Defendant is a sophisticated
financial institution that had a New York Branch and routinely conducted business in the United
States through that branch. As such, it reasonably can be presumed that Defendant was “fully
aware of U.S. law concerning financial institutions, including provisions of the ATA
criminalizing material support to terrorist organizations.” Wultz I, 755 F. Supp. 2d at 34.
Assuming the truth of Plaintiffs’ allegations, Defendant reasonably could have foreseen that
repeatedly availing itself of New York to execute the New York Transfers would subject it to
jurisdiction in the United States with respect to the overall course of conduct of which those
transfers were a part.
Nevertheless, Defendant asserts the same fallacy as it did with respect to § 302(a)(1),
arguing that due process prohibits the Court from exercising “jurisdiction” over transfers that
never went through New York or the United States. Defendant contends that this principle is
exemplified in a decision recently reached by the Honorable Naomi R. Buchwald, United States
District Judge for the Southern District of New York, in a multidistrict litigation concerning
alleged manipulation of the London Interbank Offer Rate (“LIBOR”). (See Oct. 16, 2015
Friedman Ltr.; see also Tr. 44:12-25.) In basic terms, LIBOR is a set of interest-rate benchmarks
calculated on the basis of quotes from a panel of leading banks, each of which reports on a daily
basis the rate at which it could borrow funds under certain stated conditions. See LIBOR, 2015
WL 4634541, at *2-3. The plaintiffs in the multidistrict litigation allege, inter alia, that the panel
banks knowingly and persistently submitted falsely high or low quotes to manipulate LIBOR in a
manner designed to fraudulently improve their respective positions in the market. As a threshold
ruling, Judge Buchwald indicated that specific jurisdiction would not exist in New York with
respect to any claim alleging fraud based upon a false LIBOR quote that neither was determined
nor submitted in New York, nor otherwise requested by a trader located in New York. See Id. at
Whatever basis in the facts and law that ruling had in LIBOR, no such basis can be found
here. In that case, each purportedly false LIBOR submission at issue was alleged to have caused
a distinct and identifiable harm that directly gave rise to a specific plaintiff’s claim.
transfers at issue here are not comparable.
Without rehashing the Court’s entire analysis
concerning the scope of jurisdiction under § 302(a)(1), supra, Plaintiffs’ claims are that
Defendant provided material support to an FTO and knowingly financed terrorism. Those claims
rest upon the many transfers Defendant made to the Charities on behalf of CBSP in close
temporal proximity to the 19 attacks in which Plaintiffs were injured. Due process does not
require that the Court secure a basis for jurisdiction over all of those transfers in order to
adjudicate Plaintiffs’ claims. Rather, as discussed, Plaintiffs must show that there is a substantial
relationship between claims made in connection with all 19 attacks and Defendant’s relevant
New York conduct. See Walden, 134 S. Ct. at 1121. Based on its prior determination that
Plaintiffs adequately have done so, prima facie, the Court may exercise jurisdiction with respect
to all of their claims without offending due process.
At the second stage of the due process analysis, the party challenging jurisdiction bears a
heavy burden to make “a compelling case that the presence of some other considerations would
render jurisdiction unreasonable.” Bank Brussels Lambert, 305 F.3d at 129 (quoting Metro. Life
Ins. Co., 84 F.3d at 568). Where a defendant has purposefully directed its suit-related conduct at
the forum State, as is the case here, “dismissals resulting from the application of the
reasonableness test should be few and far between.” Metro. Life, 84 F.3d at 575 (citing Burger
King, 471 U.S. at 477).
Among the factors typically considered by a court assessing the
reasonableness of exercising jurisdiction are: (1) “the burden that the exercise of jurisdiction will
impose on the [entity]”; (2) “the interests of the forum state in adjudicating the case”; (3) “the
plaintiff’s interest in obtaining convenient and effective relief”; (4) “the interstate judicial
system’s interest in obtaining the most efficient resolution of the controversy”; and (5) “the
shared interest of the states in furthering substantive social policies.” Gucci III, 2015 WL
5707135, at *9 (citing Bank Brussels Lambert, 305 F.3d at 129) (alterations in original). In
addition, “[w]hen the entity that may be subject to personal jurisdiction is a foreign one, courts
consider the international judicial system’s interest in efficiency and the shared interests of the
nations in advancing substantive policies.” Id. (citing Asahi Metal Indus. Co. v. Superior Ct. of
Cal., Solano Cnty. 480 U.S. 102, 115 (1987)) (emphasis in original).
Here, in challenging jurisdiction, Defendant does not directly address the individual
reasonableness factors. Having considered those factors anyway, the Court concludes that they
support the exercise of jurisdiction over Defendant. To begin with, Defendant has been litigating
this action in this Court for the better part of ten years. Extensive discovery already has taken
place, with the parties capably surmounting any obstacles presented by the fact that many of the
pertinent witnesses and documents are located abroad. As such, Defendant cannot seriously
contend that continuing to litigate this case in New York presents an unreasonable burden. See
Licci III, 732 F.3d at 174 (observing that any such burden is eased by “the conveniences of
modern communication and transportation”). Indeed, up until Daimler was decided, Defendant
presumably had every expectation of litigating this matter to a resolution in New York.
Furthermore, the claims in this action are predicated on the overall course of conduct by
which Defendant allegedly provided financial support to a terrorist organization. To the extent
Defendant’s use of New York’s banking system was integral to that conduct, the Court also may
take into account “the United States’ and New York’s interest in monitoring banks and banking
activity to ensure that its system is not used as an instrument in support of terrorism.” Id.
Finally, although not a controlling factor, it is appropriate to consider the federal policy
underlying Congress’ enactment of the ATA. Cf. 4 Wright & Miller, Federal Practice and
Procedure § 1068.1 (4th ed.) (“[W]hen Congress has undertaken to enact a nationwide service
statute applicable to a certain class of disputes, that statute should be afforded substantial weight
as a legislative articulation of federal social policy.”) As demonstrated by the legislative history
and express language of the ATA, a clear statutory objective is “to give American nationals
broad remedies in a procedurally privileged U.S. forum.” Goldberg v. UBS AG, 660 F. Supp. 2d
410, 422 (E.D.N.Y. 2009).
Defendant is entitled.
That policy by no means overrides the due process to which
However, having already determined that Defendant established
“minimum contacts” with the United States as a whole, the Court is further persuaded by that
policy and the other reasonableness factors that exercising jurisdiction over Defendant is
consistent with due process. Accordingly, Defendant’s motion to dismiss for lack of personal
jurisdiction is denied.15
Pendent Personal Jurisdiction
Plaintiffs invoke the doctrine of pendent personal jurisdiction as an alternative basis for
finding that Defendant is subject to jurisdiction with respect to all of Plaintiffs’ claims. (See Pl.s’
Opp’n at 19 n.9.) In general, that doctrine permits a court to exercise personal jurisdiction with
respect to a claim for which it otherwise lacks jurisdiction, if that claim arises from the same
common nucleus of fact as another claim for which the court properly has jurisdiction over the
defendant. See 4 Wright & Miller, Federal Practice and Procedure § 1069.7 (4th ed.) However,
within the Second Circuit, the doctrine of pendent personal jurisdiction primarily has been
embraced to permit the adjudication of pendent state law claims that derive from the same
common nucleus of fact as a federal claim for which the court has jurisdiction over the
defendant. See, e.g., IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049, 1059 (2d Cir.
1993); see also Hargarve v. Oki Nursery, Inc., 646 F.2d 716, 719-21 (2d Cir. 1980) (court that
properly had jurisdiction over defendant on state law claim permitted to exercise pendent
jurisdiction as to related state law claims). Notably, those are not the circumstances here, where
all of Plaintiffs’ claims are brought under a single federal statute. In any event, having already
determined that it may exercise jurisdiction with respect to all of Plaintiffs’ claims under
traditional personal jurisdiction principles, the Court need not decide whether it also would be
In Gucci II, the Second Circuit directed the district court to consider, upon remand, whether the exercise of
jurisdiction over Bank of China would comport with principles of international comity. See Gucci II, 768 F.3d at
138-39. However, in that case, there was an alleged conflict of law between Chinese banking laws and an assetfreeze injunction issued by the district court. Id. Here, Defendant does not address the issue of comity, nor is there
any suggestion that merely continuing to exercise jurisdiction over Defendant, albeit on a theory of specific
jurisdiction rather than general, would conflict with any foreign laws or otherwise infringe on the sovereign interests
of a foreign state.
appropriate to exercise pendent personal jurisdiction. Therefore, the Court declines to do so.
Defendant’s Motion for Summary Judgment
Defendant alternatively moves for summary judgment on the basis that the Court can
exercise jurisdiction only with respect to the New York Transfers, and Plaintiffs cannot prove
Defendant’s liability in a case confined just to those five transfers. (See Def.’s Mem. at 15-25.)
In other words, Plaintiffs purportedly cannot prevail on their claims because they cannot prove
that as of July 31, 2001—the date of the last New York Transfer—Defendant acted with the
requisite scienter and proximately caused Plaintiffs’ injuries. However, the Court already has
rejected Defendant’s arguments seeking to limit the scope of jurisdiction in this manner,
including the fallacy that the Court must secure jurisdiction over individual transfers rather than
jurisdiction over Defendant itself. Accordingly, Defendant’s motion for summary judgment is
For the foregoing reasons, Defendant’s motion to dismiss this action, or in the alternative
for summary judgment, is denied in its entirety.
Dated: Brooklyn, New York
March 31, 2016
DORA L. IRIZARRY
United States District Judge
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