Tymoshenko et al v. Firtash et al

Filing 79

OPINION & ORDER: The Court GRANTS Defendant RUE's motion to dismiss Plaintiffs' claims for lack of personal jurisdiction. [Dkt. No. 56]. Plaintiffs' claims are dismissed without prejudice. (Signed by Judge Kimba M. Wood on 3/26/2013) (ft)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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:
YULIA TYMOSHENKO, and JOHN DOES 1
:
through 50, on behalf of themselves and all of
:
those similarly situated,
:
:
Plaintiffs,
:
:
-against:
:
DMYTRO FIRTASH, et al.,
:
:
Defendants.
:
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11-CV-2794 (KMW)
OPINION & ORDER

WOOD, U.S.D.J.:
Former Ukrainian Prime Minister Yulia Tymoshenko and John Does 1 through 50
(collectively, “Plaintiffs”) bring this action for alleged violations of Plaintiffs’ human rights.
Plaintiffs’ Amended Complaint (“AC”) alleges that Defendants—a group of American and
foreign individuals and corporations—violated the Alien Torts Statute (“ATS”), 28 U.S.C. §
1350, the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 19611968, and various state laws. Plaintiffs seek damages and a declaration that the Ukrainian
practice of detaining Plaintiffs for prolonged periods violates international law.
Defendant RosUkrEnergo AG (“RUE”) has moved to dismiss the AC, claiming that this
Court lacks personal jurisdiction over RUE. [Dkt. No. 56]. For the following reasons, the Court
GRANTS RUE’s motion to dismiss.

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I.

RELEVANT BACKGROUND
The AC alleges the following. RUE is a company registered and headquartered in

Switzerland. RUE is owned by one company and two individuals (a Russian gas company owns
50% of RUE; Defendant Dmytro Firtash owns 45% of RUE through his holding company,
Defendant Centragas Holding AG [“Centragas]; and Firtash’s associate, Ivan Fursin owns 5% of
RUE through Centragas). (AC ¶ 83). According to the AC, Firtash, “although not a majority
shareholder, effectively controls RUE’s operations.” (AC ¶ 31). Plaintiffs also allege that RUE
has “possible connections with organized crime,” (AC ¶ 83), and has used “corrupt business
dealings and illegal kickbacks” to secure a position as an intermediary in the Ukrainian natural
gas trade, (AC ¶ 86). As part of its intermediary role, RUE was paid from two New York bank
accounts belonging to Naftogaz, a state-owned Ukrainian natural gas monopoly. (AC ¶ 32).
Plaintiffs’ allegations against RUE arise from RUE’s alleged role in a conspiracy, headed
by Firtash, to punish Tymoshenko and her political allies for their actions during her tenure as
Prime Minister of Ukraine. In 2009, Tymoshenko renegotiated Ukraine’s natural gas contracts
with Russia, eliminating RUE as an intermediary (which resulted in a significant financial loss
for RUE). (AC ¶ 141). Firtash stated publicly that the renegotiated gas contracts were “criminal
and the ‘most stupid contract[s] in Ukraine’s history.’” (AC ¶ 143).
Following a political campaign financed by Firtash, (AC ¶ 147),Viktor Yanukovich was
elected President of the Ukraine in February 2010. (AC ¶ 153). With this change in leadership,
many of Firtash’s and RUE’s allies returned to power. (AC ¶¶ 147-48). Firtash used his
connections to void the gas contracts negotiated during Tymoshenko’s administration; to restore
RUE’s role as an intermediary in the Ukrainian gas trade; and to obtain a $3.5 billion arbitration
award in RUE’s favor, payable by the Ukrainian government. (AC ¶¶ 154-55).

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Plaintiffs allege that RUE, in order to put its funds “outside the jurisdiction of Ukrainian
courts,” invested a “sizable portion” of the aforementioned arbitral award, and its profits, in a
group of shell companies within the United States. (AC ¶ 95). The shell companies were
affiliated with Firtash and were allegedly used “to launder money in the United States and
abroad under the guise of investing in legitimate business ventures.” (AC ¶ 100). These
companies allegedly engaged in several transactions in the United States, including real estate
investments, to launder Defendants’ money. (See AC ¶¶ 95-134) Although Plaintiffs’ brief
states that RUE engaged in these transactions, the AC does not state any fact that would suggest
that RUE controlled, directed, or had knowledge of the U.S. shell companies’ actions. (See Pls.’
Mem. in Opp’n 10-12 [Dkt. No. 70]).
As retribution for eliminating RUE from the Ukrainian natural gas trade, the Yanukovich
government—allegedly incentivized by illegal kickbacks from Firtash and RUE, (AC ¶ 93)—has
filed criminal charges against Tymoshenko and other former government officials. (AC ¶¶ 15960). Tymoshenko has been subjected to a politically-motivated “show trial,” (AC ¶ 78), and has
been incarcerated since August 2011. (AC ¶¶ 193-96).
Plaintiffs seek compensatory, punitive, and treble damages, as well as a declaration that
“the state practice of arbitrarily detaining Plaintiffs for prolonged periods is a violation of
international law.” (AC ¶ 93). RUE now moves to dismiss the AC pursuant to Rule 12(b)(2) for
lack of personal jurisdiction.1 [Dkt. No. 57].
II.

LEGAL STANDARD
On a Rule 12(b)(2) motion, the plaintiff bears the burden of establishing that the court has

personal jurisdiction over the defendant. Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d
1

RUE makes other arguments to support dismissal. (See Def. RUE’s Mem. in Supp. 14-24 [Dkt. No.
57]). However, because the Court’s resolution of personal jurisdiction is dispositive, it does not address
these arguments.

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560, 566 (2d Cir. 1996). “Prior to discovery, a plaintiff challenged by a jurisdiction testing
motion may defeat the motion by pleading in good faith ... legally sufficient allegations of
jurisdiction, i.e., by making a prima facie showing of jurisdiction.” Jazini v. Nissan Motor Co.,
148 F.3d 181, 184 (2d Cir. 1998) (internal quotation marks and citations omitted). A prima facie
showing “must include an averment of facts that, if credited by the ultimate trier of fact, would
suffice to establish jurisdiction over the defendant.” Chloé v. Queen Bee of Beverly Hills, LLC,
616 F.3d 158, 163 (2d Cir. 2010). District courts have “considerable procedural leeway” in
deciding whether or not a plaintiff has made a prima facie showing of jurisdiction, Marine
Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir. 1981), but must construe all allegations
“in the light most favorable to the plaintiff” and resolve all doubts in the plaintiff’s favor,
“notwithstanding a controverting presentation by the moving party.” A.I. Trade Fin., Inc. v.
Petra Bank, 989 F.2d 76, 79-80 (2d Cir. 1993).
III.

PERSONAL JURISDICTION PURSUANT TO RULE 4(K)(2)2
Federal Rule of Civil Procedure 4(k)(2) permits a federal court to exercise personal

jurisdiction over a defendant for claims arising under federal law “if: (A) the defendant is not
subject to jurisdiction in any state’s courts of general jurisdiction; and (B) exercising jurisdiction
is consistent with the United States Constitution and laws.” Fed. R. Civ. P. 4(k)(2). “Rule
4(k)(2) is designed to fill a gap in the enforcement of federal law for courts to exercise personal
jurisdiction over defendants having sufficient contacts with the United States to justify the
application of United States law, but having insufficient contact with any single state to support
jurisdiction under state long-arm legislation.” Daventree Ltd. v. Republic of Azer., 349 F. Supp.
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In the AC, Plaintiffs asserted that the Court has personal jurisdiction over “all parties” “by virtue of their
residence in New York, their business and/or tortious activities in this state, or by operation of Fed. R.
Civ. P. 4(k)(1-2).” (AC ¶ 45). In their briefing, however, Plaintiffs assert jurisdiction over RUE only
under Rule 4(k)(2). (See Pls.’ Mem. of Law in Opp’n 7-13 [Dkt. No. 70]). Consequently, the Court will
only consider whether jurisdiction exists pursuant to Rule 4(k)(2).

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2d 736, 760 (S.D.N.Y. 2004) (Stein, J.) (quoting Fed. R. Civ. P. 4(k)(2), advisory comm. note
(1993)). Thus, to establish personal jurisdiction pursuant to Rule 4(k)(2), a plaintiff must show
that (1) the plaintiff’s cause of action arises under federal law; (2) the defendant is not subject to
the jurisdiction of any state; and (3) the exercise of personal jurisdiction over the defendant is
consistent with the United States Constitution and laws. Porina v. Marward Shipping Co., Ltd.,
521 F.3d 122, 127 (2d Cir. 2008).
The first two elements are not in dispute; Plaintiffs’ claims arise out of federal law, and
both parties concede that RUE is not subject to personal jurisdiction in New York or any other
state. (Pls.’ Mem. of Law in Opp’n 8; Def.’s Mem. in Supp. 2). The third element requires the
Court’s exercise of personal jurisdiction to comport with Fifth Amendment due process.
Dardana Ltd. v. Yuganskneftegaz, 317 F.3d 202, 207 (2d Cir. 2003). “Due process permits a
court to exercise personal jurisdiction over a non-resident where the maintenance of the suit
would not ‘offend traditional notions of fair play and substantial justice.’” Porina, 521 F.3d at
127 (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). The requirements of due
process are met if: (1) the defendant “has sufficient minimum contacts to justify the exercise of
personal jurisdiction,” id., and (2) exercising jurisdiction “is reasonable under the circumstances
of the particular case.” Metro. Life, 84 F.3d at 568. These elements interact: “the weaker the
plaintiff’s showing on minimum contacts, the less a defendant need show in terms of
unreasonableness to defeat jurisdiction.” Id. (quoting Ticketmaster-New York, Inc. v. Alioto, 26
F.3d 201, 210 (1st Cir. 1994)). The Court finds that RUE does not have sufficient contacts with
the United States to justify the exercise of personal jurisdiction, and that, in any event, the
exercise of such jurisdiction would be unreasonable.

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A. Minimum Contacts
There are two methods for establishing constitutionally sufficient minimum contacts.
First, specific jurisdiction over a non-resident defendant exists “‘in a suit arising out of or related
to the defendant’s contacts with the forum.’” Porina, 521 F.3d at 127 (quoting Helicopteros
Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984)). Second, where the suit is not
related to the defendant’s contacts with the forum, general jurisdiction over a non-resident exists
where the defendant’s “general business contacts with [the forum] were sufficiently ‘continuous
and systematic’ to justify subjecting it to suit within the jurisdiction.” Metro. Life, 84 F.3d at
565. Plaintiffs do not argue that their claims arise out of RUE’s contacts with the United States.
(See Pls.’ Mem. in Opp’n 9). Consequently, Plaintiffs “must satisfy the ‘more stringent
minimum contacts test’ for general jurisdiction cases, by showing that [RUE] had ‘continuous
and systematic general business contacts’ with the United States.” Porina, 521 F.3d at 128
(quoting Helicopteros, 466 U.S. at 416). As a “minimum prerequisite to the assertion of
jurisdiction,” constitutional minimum contacts also require “some act by which the defendant
purposefully avails itself of the privilege of conducting activities within the forum.” Id. (quoting
Hanson v. Denckla, 357 U.S. 235, 253 (1958)).
RUE claims, and Plaintiffs do not contest, that it has “no offices, employees, bank
accounts or property in . . . the United States[,] nor does it solicit or do business here.” (RUE
Mem. in Supp. 2-3). Plaintiffs allege only two contacts between RUE and the United States.
First, Plaintiffs claim that Naftogaz used its New York bank accounts to pay RUE some of the
proceeds from its natural gas contracts in Ukraine. (AC ¶ 32). Second, Plaintiffs allege that
Firtash, who allegedly controls RUE, invested some of RUE’s profits in a host of “shell
companies” based in the United States. (AC ¶ 96). These shell companies then “laundered”

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those funds by investing the money in a series of real estate transactions in the United States,
although the real estate projects were never completed. (AC ¶¶ 96, 113-35).
Examining these contacts together in the light most favorable to Plaintiffs, the Court
cannot conclude that RUE “purposefully availed” itself of the privilege of conducting business in
the United States. Indeed, the AC does not even allege that RUE invested in U.S. shell
companies; rather, it alleges that Firtash invested RUE’s profits, presumably on its behalf. (AC
¶ 96). Assuming this contact can be attributed to RUE, simply receiving money from a foreign
entity’s United States account and investing in independent United States-based companies is not
enough for the Court to assert personal jurisdiction over RUE. See Transatlantic
Shiffahrtskontor GmBh v. Shanghai Foreign Trade Corp., 996 F. Supp. 326, 335 (S.D.N.Y.
1998) (Cedarbaum, J.) (“The mere agreement to pay funds to a bank account in New York does
not establish constitutionally sufficient minimum contacts with New York.”); Helicopteros, 466
U.S. at 416 (holding that the fact that foreign defendant accepted payment from a Texas bank “is
of negligible significance for purposes of determining whether [Defendant] had sufficient
contacts in Texas”). Although the companies in which RUE purportedly invested may have
engaged in more extensive activities within the United States, the AC fails to allege that RUE
controlled, directed, or even knew about these acts. Moreover, even if RUE were more involved
in these corporations’ investment decisions, that would not, in and of itself, suffice to show that
RUE has “the requisite continuous and systematic contact” with the United States. In re
Terrorist Attacks, 718 F. Supp. 2d 456, 471 (S.D.N.Y. 2010) (Daniels, J.); cf. Jazini, 148 F.3d at
148 (noting that presence of corporate subsidiary can establish parent’s presence only if it is an
“agent” or a “mere department of” the foreign parent). Absent more than the threadbare

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connections pled in the AC, Plaintiffs cannot meet the “stringent” test for minimum contacts
general jurisdiction demands. Metro. Life, 84 F.3d at 568.
Alternatively, Plaintiffs argue that the Court should examine the conduct of RUE’s coconspirators in order to establish personal jurisdiction over RUE. (Pls.’ Mem. in Opp’n 10).
“Whether the forum contacts of an in-state actor may be attributed to an out-of-state coconspirator for due process purposes or whether the latter must independently satisfy the
‘minimum contacts’ requirement is open to question.” Simon v. Philip Morris, Inc., 86 F. Supp.
2d 95, 127 (E.D.N.Y. 2000) (collecting cases). In this Circuit, decisions that have attributed the
contacts of a defendant’s co-conspirators have done so by applying New York state’s long-arm
statute under Rule 4(k)(1), not under Rule 4(k)(2). E.g. Daventree, 349 F. Supp. 2d at 765;
Simon, 86 F. Supp. 2d at 127.3 However, although “[w]hether a plaintiff can establish personal
jurisdiction over a defendant pursuant to Rule 4(k)(2) through the imputation of contacts of that
defendant's putative co-conspirators with the United States has not been [decisively] addressed,”
Daventree, 349 F. Supp. 2d at 765, the use of this conspiracy theory has been widely criticized
by courts and scholars. See, e.g., Davis v. A.& J. Elec., 792 F.2d 74, 76 (7th Cir. 1986) (holding
that there is no “independent federal ‘civil co-conspirator’ theory of personal jurisdiction.”); Ann
Althouse, The Use of Conspiracy Theory to Establish in Personam Jurisdiction: A Due Process
Analysis, 52 Fordham L. Rev. 234 (1983).

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Further, “[t]he analysis of those New York courts that have addressed the constitutionality of conspiracy
jurisdiction has centered on the defendant’s awareness of the commission of [co-conspirator’s] acts pursuant to” a
conspiracy committed within the forum state. Simon, 86 F. Supp. 2d at 127; see also Andre Emmerich Gallery, Inc.
v. Segre, No. 96 Civ. 889, 1997 WL 672009, at *6 (S.D.N.Y Oct. 29, 1997) (Haight, J.) (holding that defendant’s
knowledge that a forged artwork would be sold to a New York art dealer, thus affecting the New York art market,
created enough of a forum connection to satisfy due process). Even if the Court were to apply the New York longarm statute’ attribution theory to Rule 4(k)(2), the Court finds that Plaintiffs have failed to demonstrate either that
the conspiracy took place in the United States or that RUE was aware of any overt acts committed in furtherance of
a conspiracy in the United States.

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In light of these considerations, the Court declines to consider the contacts of RUE’s coconspirators to establish personal jurisdiction over RUE and instead focuses on RUE’s individual
contacts—which, as discussed above, are insufficient to confer personal jurisdiction.
B. Reasonableness
Even if RUE’s contacts with the United States were constitutionally sufficient, the Court
nonetheless finds that the exercise of personal jurisdiction over RUE would be unreasonable. A
defendant’s contacts must be considered in light of other factors to determine whether the
assertion of personal jurisdiction would be “reasonable.” The exercise of personal jurisdiction
must comport with “fair play and substantial justice.” Burger King Corp. v. Rudzewicz, 471 U.S.
462, 476 (1985). “[T]he reasonableness prong of the due process inquiry evokes a sliding scale:
the weaker the plaintiff’s showing on minimum contacts, the less a defendant need to show in
terms of unreasonableness to defeat jurisdiction.” Metro. Life, 84 F.3d at 569 (quoting
Ticketmaster, 26 F.3d at 210). In this analysis, the defendant bears the burden of demonstrating
“that the assertion of jurisdiction in the forum will make litigation so gravely difficult and
inconvenient that [he] unfairly is at a severe disadvantage in comparison to his opponent.” SEC
v. Softpoint, Inc., No. 95 Civ. 2951, 2001 WL 43611, at *5 (S.D.N.Y. Jan. 18, 2001) (Lynch, J.)
(quoting Burger King, 471 U.S. at 478) (internal quotation marks omitted).
The reasonableness inquiry is an equitable balancing test that directs the Court to
consider five factors: (1) “the burden that the exercise of jurisdiction will impose on the
defendant;” (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

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states in furthering social substantive policies.” Metro. Life, 84 F.3d at 568 (citing Asahi Metal
Indus. Co., Ltd. v. Superior Court of Cal., Solano Cnty., 480 U.S. 102, 113-14 (1987)).
Although the defendant bears a heavy burden to show that the exercise of jurisdiction
would be unreasonable, see SEC v. Morton, No. 10 Civ. 1720, 2011 WL 1344259, at *12
(S.D.N.Y. Mar. 31, 2011) (Dolinger, Mag.), courts have routinely found jurisdiction to be
unreasonable where neither party has ties to the forum, see, e.g., Asahi, 480 U.S. at 106; Tamam
v. Fransabank Sal, 677 F. Supp. 2d 720, 733 (S.D.N.Y. 2010) (Keenan, J.). Given that neither
party in the instant case has a connection to the United States, nor have Plaintiffs alleged
anything more than minimal contact between RUE and the United States, the Court finds that
asserting jurisdiction over RUE would “offend traditional notions of fair play and substantial
justice.” Int’l Shoe, 326 U.S. at 316.
First, exercising jurisdiction would impose a substantial burden on RUE—a Swiss
corporation that does no business in the United States—by forcing RUE to defend a suit in New
York. See Kernan v. Kurz-Hastings, Inc., 175 F.3d 236, 244 (2d Cir. 1999) (holding that a
Japanese corporation would face a substantial burden on if forced to defend a suit in New York);
see also Asahi, 480 U.S. at 114 (noting that courts must give “significant weight” to the “unique
burdens placed upon one who must defend oneself in a foreign legal system”); Mega Tech Int’l
v. Al-Saghyir Establishment, No. 96 Civ. 8711, 1999 WL 269896, at *6 (noting that despite the
“conveniences of modern communication and transportation,” it would still be both costly and
cumbersome for Saudi Arabian defendant to litigate in New York). Nor have Plaintiffs, all of
whom reside in Ukraine, alleged that this forum is any more convenient to them. See Tamam,
677 F. Supp. 2d at 733.

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The Court finds the second factor to be the most important consideration here, because
the United States has a very limited interest in adjudicating this case. Both RUE and Plaintiffs
are foreign residents, and all of the conduct underlying Plaintiffs’ claims occurred abroad. In
cases where the plaintiff is not a resident of a particular forum, “the forum’s legitimate interests
in the dispute have considerably diminished.” In re S. African Apartheid Litig., 643 F. Supp. 2d
423, 431 (S.D.N.Y. 2009) (Scheindlin, J.) (internal quotation marks omitted). Although the
United States does have an interest in stopping human rights abuses, this interest is minimal
where, as here, both parties are foreign nationals litigating a dispute that took place entirely in
the Ukraine. See Tamam, 677 F. Supp. 2d at 733; Int’l Hous. Ltd. v. Rafidain Bank Iraq, 712 F.
Supp. 1112, 1119 (S.D.N.Y. 1989) (Ward, J.). This lack of interest weighs against the exercise
of jurisdiction.
To the extent that Plaintiffs’ claims involve violations of Ukrainian law, federal courts
are ill-equipped to assess such a claim. See Porina v. Marward Shipping Co., No. 05 Civ. 5621,
2006 WL 2465819, at *24 (S.D.N.Y. 2006) (Patterson, J.), aff’d, 521 F.3d 122 (2d. Cir 2008).
Plaintiffs may also have difficulty obtaining effective relief from this forum. Although the Court
would have jurisdiction to enforce any judgment entered against a foreign plaintiff, RUE has no
known assets in the United States, and enforcing any monetary judgment could require further
litigation. See, e.g., Eitzen Bulk A/S v. Bank of India, 827 F. Supp. 2d 234 (S.D.N.Y. 2011)
(Hellerstein, J.). This factor therefore strongly weighs against a finding of jurisdiction.
Fourth, in evaluating the interstate judicial system’s interest in obtaining the most
efficient resolution, the Court considers the location of likely witnesses and evidence. Metro.
Life, 84 F.3d at 574. Most of the relevant evidence and witnesses in this case are located in

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Ukraine, and are beyond the Court’s subpoena power. Metro. Life, 84 F.3d at 574-75. This
factor thus also strongly weighs against the exercise of jurisdiction.
Finally, the Court finds that the interest in promoting substantive social policies weighs
somewhat in Plaintiffs’ favor. As Plaintiffs have argued, the United States does have a policy
interest in protecting human rights. However, when considering reasonableness, courts must
consider the procedural and substantive policies of other nations in deciding whether to assert
jurisdiction, and take “great care and reserve” when extending the U.S. concept of personal
jurisdiction into the international field. Asahi, 480 U.S. at 107. In this case, it would be
unreasonable for the Court to intrude on matters that are wholly located in Ukraine.
In light of these factors, the Court finds the exercise of jurisdiction over RUE to be
unreasonable.
IV.

JURISDICTIONAL DISCOVERY
Plaintiffs also request the opportunity to conduct jurisdictional discovery. (Pls.’ Mem. in

Opp’n 13). However, RUE argues that Plaintiffs’ request should be denied because Plaintiffs
have failed to allege facts to support a prima facie showing of jurisdiction. (Def.’s Mem. in
Supp. 5-6).
At the jurisdictional stage, “district courts enjoy broad discretion in deciding whether to
order discovery.” In re Terrorist Attacks on September 11, 2001, 349 F. Supp. 2d 765, 811
(S.D.N.Y 2005) (Casey, J.), aff’d, 538 F.3d 71 (2d Cir. 2008). The failure to make out a prima
facie case does not always bar jurisdictional discovery. Ehrenfeld v. Mahfouz, 489 F.3d 542, 550
n.6 (2d Cir. 2007). Rather, the court should grant plaintiffs such discovery if “facts may exist” to
support jurisdiction. Marine Midland, 664 F.2d at 904. But if the plaintiff offers only
“speculations or hopes ... that further connections to [the forum] will come to light in discovery,”

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the court should dismiss the complaint. Rosenberg v. PK Graphics, No. 03 Civ. 6655, 2004 WL
1057621, at *1 (S.D.N.Y. May 10, 2004) (Buchwald, J.).
Here, Plaintiffs have offered no rationale as to why jurisdictional discovery is likely to
elicit information connecting RUE to the United States. (Pls.’ Mem. in Opp’n 14). Furthermore,
although a prima facie showing of personal jurisdiction is not a prerequisite for obtaining
jurisdictional discovery, its absence renders discovery less likely to yield useful information.
Jazini, 148 F.3d at 186. Finally, the fact that RUE is a foreign corporation also disfavors
jurisdictional discovery . See id. at 185-86 (noting that allowing jurisdictional discovery over
foreign corporate defendant would be a practice that district courts have “not hitherto engaged”);
Daventree, 349 F. Supp. 2d at 761.
V.

LEAVE TO REPLEAD
Plaintiffs argue that that the Court should grant Plaintiffs the opportunity to replead.

Defendants argue that since “the problems with the Plaintiffs’ claims are substantive …
repleading would be futile.” (RUE Reply Mem. 8 [Dkt. No. 73]).
The question of whether to allow Plaintiffs to replead is a matter of this Court’s “sound
discretion.” McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 200 (2d Cir. 2007). Leave to
amend a complaint “shall be freely given when justice so requires.” Fed. R. Civ. P. 15(a); see
also Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991) (“It is the usual
practice upon granting a motion to dismiss to allow leave to replead.”). Leave to replead should
be denied, however, if it would be futile. McCarthy, 482 F.3d at 200.
The Court finds that repleading may not be futile in this case. Plaintiffs have amended
their complaint only once, and that was before RUE made its motion to dismiss. Plaintiffs

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should be granted leave to assert facts, if they exist, that would show that RUE has contacts with
the United States such that it would be reasonable to subject it to jurisdiction here.
VI.

CONCLUSION
For the foregoing reasons, the Court GRANTS Defendant RUE’s motion to dismiss

Plaintiffs’ claims for lack of personal jurisdiction. [Dkt. No. 56]. Plaintiffs’ claims are
dismissed without prejudice.

SO ORDERED.
Dated: New York, New York
March 26, 2013

/s/____________________________
Kimba M. Wood
United States District Judge

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