HDtracks.com, LLC v. 7digital Group PLC

Filing 51

OPINION AND ORDER re: 43 LETTER MOTION for Leave to File Third Amended Complaint Or In The Alternative Leave For Limited Discovery And For An Extension Of Time addressed to Judge John F. Keenan from Richard S. Busch, King & Ballow, Counsel for Plaintiff dated Decem filed by HDtracks.com, LLC. For the reasons set forth above, HDT's motions for leave to file a TAC or, alternatively, to conduct limited discovery are DENIED. 7d Limited has already filed its answer and thus t his case will proceed to discovery before Magistrate Judge Parker. The parties are directed to confer and file a joint-proposed case management order within 30 days of the date of this Opinion & Order. The Clerk of Court is directed to terminate the motion docketed at ECF No. 43. (As further set forth in this Order.) (Signed by Judge John F. Keenan on 2/6/2020) (cf)

Case 1:09-md-02013-PAC Document 57

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------- X
HDTRACKS.COM, LLC,
:
UNITED STATES DISTRICT COURT
:
SOUTHERN DISTRICT OF NEW YORK
Plaintiff,
:
-----------------------------------------------------------x
:
In re FANNIE MAE 2008 SECURITIES
:
-against:
LITIGATION
:
:
:
7DIGITAL LIMITED, a UK private :
limited company,
:
:
:
-----------------------------------------------------------x
Defendant.
:
------------------------------- X

Filed 09/30/10 Page 1 of 45
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: 02/06/2020

08 18 Civ. 5823 (JFK)
No.Civ. 7831 (PAC)
09 MD 2013 (PAC)
OPINION & ORDER
OPINION & ORDER

APPEARANCES
HONORABLE PAUL A. CROTTY, United States District Judge:
FOR PLAINTIFF HDTRACKS.COM, LLC
Richard S. Busch
BACKGROUND1
KING & BALLOW
The early years of this decade saw a boom in home financing which was fueled, among
FOR DEFENDANT 7DIGITAL LIMITED
William L. Charron
other things, by low interest rates and lax credit conditions. New lending instruments, such as
Matthew S. Barkan
subprimePRYOR CASHMAN LLP loans) and Alt-A mortgages (low-documentation loans)
mortgages (high credit risk
JOHN F. KEENAN, United States too; they took on unmanageable risks on the
kept the boom going. Borrowers played a roleDistrict Judge:
Plaintiff HDtracks.com, LLC (“HDT”) brings a motion for
assumption that the market would continue to rise and that refinancing options would always be
leave to future. third amended lacking in the system. Mortgage originators did
available in thefile aLending discipline wascomplaint (“TAC”) following the
Court’s November 19, 2019 Rather than Order (“the on their books, the
not hold these high-risk mortgage loans. Opinion &carry the rising risk MTD Order”) that
dismissed certain claims and Defendant 7digital Group PLC (“7d
originators sold their loans into the secondary mortgage market, often as securitized packages
Group”) from this action or, in MBS markets grew almost permit HDT
known as mortgage-backed securities (“MBSs”). the alternative, toexponentially.
to conduct the housing bubble burst. Ininto the demand for housing dropped abruptly
But then limited discovery 2006, whether the Court may exercise
personal jurisdiction over 7d Group. For the reasons set forth
and home prices began to fall. In light of the changing housing market, banks modified their
below, HDT’s motions are DENIED.
lending practices and became unwilling to refinance home mortgages without refinancing.

1

Unless otherwise indicated, all references cited as “(¶ _)” or to the “Complaint” are to the Amended Complaint,
dated June 22, 2009. For purposes of this Motion, all allegations in the Amended Complaint are taken as true.

1

1

I.

Background
A.

Factual Background

The Court presumes familiarity with the allegations of this
case as set forth in the MTD Order. See HDtracks.com, LLC v.
7digital Grp. PLC, No. 18 Civ. 5823 (JFK), 2019 WL 6170838
(S.D.N.Y. Nov. 19, 2019).
York online music store.

To briefly summarize, HDT is a New
Former-Defendant 7d Group and its

subsidiary, Current-Defendant 7digital Limited (“7d Limited”),
are United Kingdom music label service providers.

HDT alleges

that 7d Group and 7d Limited falsely promised to build a firstof-its-kind music streaming platform and, by failing to do so,
they caused HDT to lose its dominant market position, suffer
reputational harm, and lose millions of dollars in future
profits.

Jurisdiction is based on diversity of citizenship

pursuant to 28 U.S.C. § 1332(a).
B.

Procedural Background

On June 27, 2018, HDT initiated this action by filing a
complaint only against 7d Group for breach of contract,
fraudulent inducement, and unjust enrichment.

(ECF No. 1.)

On

August 9, 2018, HDT filed an amended complaint that added 7d
Limited as a defendant.

(ECF No. 19.)

On September 10, 2018,

HDT filed a second amended complaint (“the SAC”) to address
issues relating to subject matter jurisdiction.

(ECF No. 26.)

On November 5, 2018, 7d Group and 7d Limited moved to dismiss

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the SAC for lack of personal jurisdiction pursuant to Federal
Rule of Civil Procedure 12(b)(2), and failure to state a claim
pursuant to Rules 12(b)(6) and 9(b).

(ECF No. 33.)

On November 19, 2019, the Court issued the MTD Order which
granted in part and denied in part 7d Group and 7d Limited’s
motion to dismiss.

(ECF No. 41.)

The Court dismissed 7d Group

as a defendant for lack of personal jurisdiction, dismissed
HDT’s breach of contract and fraudulent inducement claims
because the SAC did not plausibly allege such claims, but
allowed the SAC’s breach of implied contract, declaratory
judgment, and unjust enrichment claims to move forward against
7d Limited. See HDtracks.com, 2019 WL 6170838, at *12.

The

Court ruled that HDT may seek leave to amend the SAC but ordered
it to demonstrate how it will cure the deficiencies in its
claims by filing a proposed TAC and that justice requires
granting leave to amend. See id.
the SAC on December 5, 2019.

7d Limited filed an answer to

(ECF No. 42.)

On December 11, 2019, HDT moved the Court by letter for
leave to file a TAC and identified new allegations that, it
asserts, establish 7d Group’s sufficient minimum contacts with
New York which would cure the personal jurisdiction pleading
deficiencies the Court identified in the MTD Order.
43.)

(ECF No.

In the alternative, HDT requested the Court permit limited

discovery into facts that would allow the Court to exercise

3

personal jurisdiction over 7d Group.

(Id.)

7d Limited opposed

the motion on behalf of its foreign corporate parent, 7d Group.
(ECF No. 45.)

The Court held a conference to discuss HDT’s

motion on December 18, 2019, and the parties filed additional
letters in support of their positions in early-January 2020.
(ECF Nos. 47–50.)
II.

Analysis
A.

Legal Standard

Leave to amend should be freely granted when justice so
requires. Fed. R. Civ. P. 15(a)(2); Williams v. Citigroup Inc.,
659 F.3d 208, 212 (2d Cir. 2011) (per curiam).

“This permissive

standard is consistent with [the Second Circuit’s] ‘strong
preference for resolving disputes on the merits.’” Williams, 659
F.3d 212–13.

“Nonetheless, the Court may deny leave if the

amendment (1) has been delayed unduly, (2) is sought for
dilatory purposes or is made in bad faith, (3) the opposing
party would be prejudiced, or (4) would be futile.” Lee v. Regal
Cruises, Ltd., 916 F. Supp. 300, 303 (S.D.N.Y. 1996) (citing
Foman v. Davis, 371 U.S. 178, 182 (1962)), aff’d, 116 F.3d 465
(2d Cir. 1997).

In evaluating HDT’s motion to amend, the Court

will “construe the pleadings and any supporting materials in the
light most favorable to the plaintiffs,” Licci ex rel. Licci v.
Lebanese Canadian Bank, SAL, 732 F.3d 161, 167 (2d Cir. 2013),
to determine whether the new allegations will cure the

4

deficiencies identified in the MTD Order, Wang v. King, No. 18
Civ. 8948 (JFK), 2020 WL 417690, at *3 (S.D.N.Y. Jan. 27, 2020).
To survive a motion to dismiss for lack of personal
jurisdiction, “plaintiff bears the burden of showing that the
court has jurisdiction over the defendant.

Prior to discovery,

a plaintiff may defeat a motion to dismiss based on legally
sufficient allegations of jurisdiction.” In re Magnetic
Audiotape Antitrust Litig., 334 F.3d 204, 206 (2d Cir. 2003)
(per curiam) (citations omitted).

A prima facie showing of

jurisdiction “may be made through the plaintiff’s own affidavits
and supporting materials, containing an averment of facts that,
if credited, would suffice to establish jurisdiction over the
defendant.” S.N. Eng. Telephone Co. v. Global NAPs, Inc., 624
F.3d 123, 138 (2d Cir. 2010) (internal quotation marks omitted).
“In determining whether a plaintiff has met this burden, we will
not draw argumentative inferences in the plaintiff’s favor, nor
must we accept as true a legal conclusion couched as a factual
allegation.” In re Terrorist Attacks on Sept. 11, 2001, 714 F.3d
659, 673 (2d Cir. 2013) (citation and internal quotation marks
omitted).
B.

Personal Jurisdiction

The MTD Order ruled that the totality of the circumstances
alleged by HDT formed a basis for long-arm jurisdiction over 7d
Group and 7d Limited pursuant to New York’s long-arm

5

jurisdiction statute because the SAC alleged that 7d Group and
7d Limited purposefully solicited and created a long-term and
important business relationship with HDT in New York, they
traveled to HDT’s New York office on numerous occasions and
routinely communicated with HDT in New York via telephone and
email, and the scope of the business relationship was
substantial. See HDtracks.com, 2019 WL 6170838, at *5.

Turning

to the next step in the analysis—whether the Court’s exercise of
personal jurisdiction comports with due process—the Court ruled
that personal jurisdiction over 7d Limited was appropriate, but
it was not appropriate over 7d Group because “the contacts
alleged by HDT between 7d Group, the forum and the litigation
amount to a handful of communications and transfers of funds.”
Id. at *7 (quoting SPV Osus Ltd. v. UBS AG, 882 F.3d 333, 345
(2d Cir. 2018)) (quotation marks and brackets omitted).

“This,”

the Court held, “is not enough.” Id.
The Court considered and rejected HDT’s two arguments in
favor of personal jurisdiction:

First, the Court rejected HDT’s

assertion that personal jurisdiction over 7d Group existed
because 7d Group was alleged to be the alter ego of 7d Limited.
See id. at *6.

Applying the law of 7d Group’s state of

incorporation—i.e., English law—the Court ruled that the SAC did
not allege circumstances in which an English court would pierce
the corporate veil because HDT merely asserted that 7d Group and

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7d Limited shared the same address, website, logo, and directors
and officers, and 7d Group owned and controlled a significant
portion of 7d Limited. See id.

This was not sufficient to

establish personal jurisdiction over 7d Group because “[t]he SAC
d[id] not contain any allegations that 7d Group abuse[d] 7d
Limited for the purpose of wrongdoing, or ‘that impropriety was
linked to the corporate structure.’” Id. (quoting FR 8 Singapore
Pte. Ltd. v. Albacore Mar. Inc., 794 F. Supp. 2d 449, 460
(S.D.N.Y. 2011)).
Turning to HDT’s second argument, the Court rejected its
assertion that personal jurisdiction was appropriate because “7d
Group operated in concert with 7d Limited.” Id. at *7.

This,

the Court held, did not establish sufficient contacts between 7d
Group, the forum, and the litigation because “[t]he SAC d[id]
not plausibly allege that 7d Group was a party to the business
relationship between HDT and 7d Limited that [gave] rise to 7d
Limited’s sufficient minimum contacts, especially where, as
here, the relevant document that served to implicitly bind the
parties was expressly between HDT and 7d Limited.” Id.

“Drawing

all reasonable inferences in favor of HDT,” the Court ruled,
“the overwhelming inference is that the contacts relating to the
litigation were performed solely by 7d Limited, HDT’s only
counterparty to the Term Sheet.” Id.

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Accordingly, the Court dismissed the SAC as to 7d Group for
lack of personal jurisdiction. See id.

The SAC was of course

the third complaint filed by HDT in this action and the TAC
would be the fourth.
C.

Leave to Amend

“To establish personal jurisdiction over a defendant, due
process requires a plaintiff to allege (1) that a defendant has
‘certain minimum contacts’ with the relevant forum, and (2) that
the exercise of jurisdiction is reasonable in the
circumstances.” In re Terrorist Attacks, 714 F.3d at 674.

“The

inquiry whether a forum State may assert specific jurisdiction
over a nonresident defendant focuses on the relationship among
the defendant, the forum, and the litigation.” Walden v. Fiore,
571 U.S. 277, 283–84 (2014) (internal quotation marks omitted);
see also SPV Osus, 882 F.3d at 344.

“Specific jurisdiction is

confined to adjudication of issues deriving from, or connected
with, the very controversy that establishes jurisdiction.” SPV
Osus, 882 F.3d at 344 (quotation marks and brackets omitted).
“A court must look to whether there was some act by which the
defendant purposefully availed itself of the privilege of
conducting activities within the forum State, thus invoking the
benefits and protections of its laws.” Id. (internal quotation
marks omitted).

“A defendant’s general connections with the

forum are not enough to support the exercise of specific

8

jurisdiction.” Id. (internal quotation marks and brackets
omitted).
The MTD Order directed HDT to “demonstrate . . . how it
will cure the deficiencies in its claims by filing a proposed
third amended complaint.” HDtracks.com, 2019 WL 6170838, at *12
(emphasis added).

Instead of filing a proposed TAC, however,

HDT filed a letter motion which argued that the following new
allegations it “would allege” in a TAC will establish personal
jurisdiction over 7d Group:
(1) 7d Limited is a shell company of 7d Group;
(2) HDT met with executive officers of 7d Group in New York
and always believed that it was negotiating with and dealing
with 7d Group;
(3) there were extensive communications and transfers of
funds between HDT and 7d Group; and
(4) 7d Group controlled the business relationship and
contract between the parties, and it was the real party at
issue.
7d Limited, on behalf of 7d Group, argues that HDT’s
proposed new allegations are merely versions of the same
allegations it asserted in the SAC, which the Court already
rejected as a basis for establishing personal jurisdiction over
7d Group.

The Court agrees.

First, allegation #3 was considered by the Court and
rejected as insufficient. See id. at *7 (“At bottom, the
contacts alleged by HDT between 7d Group, the forum and the
litigation amount to a handful of communications and transfers
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of funds.

This is not enough.”) (citations, internal quotation

marks, and brackets omitted).
Second, allegations #1, #2, and #4 essentially reassert
alter ego liability, which the Court rejected as a basis for
establishing personal jurisdiction because HDT does not allege
that 7d Group abused 7d Limited for the purpose of wrongdoing,
or that impropriety was linked to the corporate structure. See
id. at *6–7.

Further, even if these purportedly new allegations

were not intended to support an alter ego theory of liability,
as pleaded they still would only go to 7d Group’s alleged
liability—HDT does not explain how they establish personal
jurisdiction or show how 7d Group “purposefully availed itself
of the privilege of conducting activities within the forum
State,” SPV Osus, 882 F.3d at 344, where the relevant document
that gives rise to the controversy—i.e., the Term Sheet—was only
between HDT and 7d Limited.

The same is true of allegations

that HDT believed it was negotiating with and dealing with 7d
Group because the personal jurisdiction inquiry focuses on what
the defendant did and its sufficient minimum contacts—not what
the plaintiff believed or understood.

Finally, HDT’s

allegations that 7d Group executives met with it in New York and
engaged in extensive communications may come close to
establishing a sufficient connection between 7d Group, the
forum, and the litigation, but ultimately, these connections are

10

not enough where the Term Sheet deliberately excluded 7d Group
and declared that its terms were “non-binding” and that “[n]o
agreement or obligation will arise for either party, except as
set forth in a definitive written agreement executed by the
parties.” HDtracks.com, 2019 WL 6170838, at *2.
and executed agreement exists.

No such written

Further, both drafts of the

subsequent written agreement included identical forum-selection
clauses providing England and Wales as the relevant
jurisdiction, which gives rise to the strong inference, even
when drawn in HDT’s favor, that 7d Group did not wish to avail
itself of the privilege of conducting activities within New York
or to invoke the benefits and protections of New York law.
Third, HDT’s argument that parent corporations may be held
liable for acts by a subsidiary irrespective of any alter ego
theory of liability misses the mark because the authority HDT
cites deals with a parent company’s contractual liability for
the acts of a subsidiary—not whether personal jurisdiction is
appropriate. See, e.g., Horsehead Indus., Inc. v.
Metallgesellschaft AG, 239 A.D.2d 171, 171–72 (1st Dep’t 1997)
(“[A] parent company can be held liable as a party to its
subsidiary’s contract if the parent’s conduct manifests an
intent to be bound by the contract, which intent is inferable
from the parent’s participation in the negotiation of the
contract, or if the subsidiary is a dummy for the parent, or if

11

the subsidiary is controlled by the parent for the parent’s own
purposes.”); Warnaco Inc. v. VF Corp., 844 F. Supp. 940, 946
(S.D.N.Y. 1994) (“A parent corporation that negotiates a
contract but has a subsidiary sign it can be held liable as a
party to the contract, if the subsidiary is a dummy for the
parent corporation.”).

Here, all of HDT’s citations support an

argument that suit may be brought against 7d Group in a court of
competent jurisdiction if 7d Group assumed or was the actual
party in interest to an express contract.

Such derivative

liability, however, does not establish personal jurisdiction
over a nonresident defendant.

Indeed, quite the opposite. See

Impulse Mktg. Grp., Inc. v. Nat’l Small Bus. All., Inc., No. 05
Civ. 7776 (KMK), 2007 WL 1701813, at *6 (S.D.N.Y. June 12, 2007)
(holding plaintiff plausibly alleged that defendant had assumed
a contract with a forum-selection clause, and thus, personal
jurisdiction pursuant to the clause was appropriate; the court,
however, ordered jurisdictional discovery into plaintiff’s other
claims against defendant because “assumption of the Contract
does not give this Court personal jurisdiction over the noncontract claims”).
Further, HDT’s assertions of derivative contractual
liability may not even apply in this case.

Here, the MTD Order

ruled that the Term Sheet was not an express contract. See
HDtracks.com, 2019 WL 6170838, at *9.

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Accordingly, HDT’s claims

rely on its allegations of breach of an implied contract and
unjust enrichment, which the Court ruled were plausibly pleaded
as to 7d Limited. See id. at *12.

Under these causes of action,

7d Limited may be liable because it was the counterparty to the
Term Sheet that gives rise to the implied contract claim, and it
received the payments from HDT that give rise to the unjust
enrichment claim.

Assuming arguendo that HDT establishes that

7d Limited is a dummy subsidiary, or that 7d Group micromanaged
7d Limited, it is not clear how HDT can next establish that 7d
Group was the actual party in interest or manifested an intent
to be bound by the implied contract—to say nothing of the unjust
enrichment claim—where, once again, the Term Sheet was clearly
between HDT and 7d Limited only, and 7d Group, if in fact they
micromanaged the negotiation and performance of the Term Sheet,
clearly intended for a “non-binding” arrangement and “[n]o
agreement or obligation” for either party. Id. at *2.
Accordingly, 7d Group’s “suit-related conduct” does not appear
to create the required “substantial connection with the forum
State” necessary for personal jurisdiction. SPV Osus, 882 F.3d
at 344 (quoting Walden, 571 U.S. at 284).
Finally, the Court notes that HDT appears to misunderstand
the relevant jurisdictional inquiry.

Depending on the extent of

a defendant’s contacts with the forum, courts require “that the
in-forum conduct . . . be the proximate cause of plaintiff’s

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injuries . . . [or] the ‘but for’ cause of those injuries.” SPV
Osus, 882 F.3d at 344 (citing Chew v. Dietrich, 143 F.3d 24, 29
(2d Cir. 1998) (collecting and comparing cases)).

“In this

Circuit,” the appropriate causal standard “depends on ‘the
relationship among the defendant, the forum, and the
litigation.’” Id.

“Where the defendant has had only limited

contacts with the state it may be appropriate to say that he
will be subject to suit in that state only if the plaintiff’s
injury was proximately caused by those contacts.” Id. (quoting
Chew, 143 F.3d at 29).

Here, it is not clear that HDT has met

its burden of plausibly alleging such proximate causation where
HDT’s injury was directly caused by 7d Limited’s failure to
deliver the streaming music platform as envisioned by the Term
Sheet, and 7d Limited’s receipt of $200,000 from HDT for a
product it failed to build.

Indeed, the SAC itself specifically

alleged: “The parties contemplated and agreed that 7d Limited
would develop, build, deliver, and support the streaming service
in an adequate and timely manner sufficient to allow HDT to be
the first high-resolution and high-quality music streaming
service to market in the United States and other countries.”
(Second Amended Complaint, ECF No. 26, ¶ 4 (emphasis added).)
This assertion is the very essence of the entire litigation—and
yet it does not include 7d Group.

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Accordingly, because HDT’s proposed amendments to the SAC
would be a futile attempt to cure its pleading deficiencies,
HDT’s motion for leave to file a TAC is denied.
D.

Leave to Conduct Limited Discovery

In apparent acknowledgement of its pleading deficiencies,
HDT’s letter motion alternatively requested leave to conduct
discovery into facts that could support personal jurisdiction
over 7d Group.

Specifically, HDT identified the following

information it would seek:
(1) 7d Group’s relationship with 7d Limited;
(2) 7d Group’s contacts with and commercial activities in
the State of New York related to this case;
(3) whether 7d Group has a bank account, leases or occupies
an office, or has a license to do business in New York;
(4) identification of all past and current members of 7d
Group’s executive team; and
(5) all of 7d Group’s activities with respect to the
transaction at issue in this case.
“[I]n deciding a pretrial motion to dismiss for lack of
personal jurisdiction a district court has considerable
procedural leeway.

It may determine the motion on the basis of

affidavits alone; or it may permit discovery in aid of the
motion; or it may conduct an evidentiary hearing on the merits
of the motion.” Dorchester Fin. Sec., Inc. v. Banco BRJ, S.A.,
722 F.3d 81, 84 (2d Cir. 2013).

Although “[a] court generally

should allow a plaintiff ‘an opportunity to conduct discovery on

15

. . . jurisdictional facts, at least where the facts, for which
discovery is sought, are peculiarly within the knowledge of the
opposing party,’” Togut v. Forever 21, Inc., 285 F. Supp. 3d
643, 648 (S.D.N.Y. 2018) (ellipsis in original) (quoting
Gualandi v. Adams, 385 F.3d 236, 244 (2d Cir. 2004)), “[w]here a
plaintiff fails to establish a prima facie case that a court has
jurisdiction over a defendant, it is within a court’s discretion
whether to allow jurisdictional discovery,” id. (citing Jazini
v. Nissan Motor Co., 148 F.3d 181, 186 (2d Cir. 1998)).

“A

party seeking jurisdictional discovery . . . bears the burden of
showing necessity.” Molchatsky v. United States, 778 F. Supp. 2d
421, 438 (S.D.N.Y. 2011), aff’d, 713 F.3d 159 (2d Cir. 2013)
(per curiam).
At the December 18, 2019 conference the Court indicated
that it may allow HDT to serve interrogatories on 7d Group
relating to certain of its requests for information regarding 7d
Group’s contacts with the forum and the litigation.

Upon closer

inspection of the merits of HDT’s motion, however, the Court
finds that such discovery is not necessary or appropriate.
Accordingly, HDT’s request is denied.
“Discovery need not be granted to allow a plaintiff to
engage in an unfounded fishing expedition for jurisdictional
facts.” Togut, 285 F. Supp. 3d at 648 (quoting Vista Food Exch.,
Inc. v. Champion Foodservice, LLC, 124 F. Supp. 3d 301, 315

16

(S.D.N.Y. 2015)).

As discussed above, HDT has failed to

establish a prima facie case of personal jurisdiction over 7d
Group.

Accordingly, the Court has discretion to allow discovery

into such facts if it is necessary or if the relevant facts lie
exclusively within the defendant’s knowledge. See id.; see also
Gualandi, 385 F.3d at 244.

Here, the information HDT

anticipates in topics #1, #2, #4, and #5 above is information it
already has, was in a position to allege without discovery,
already asserted via the SAC and by affidavit, and which the
Court already considered and rejected as providing a sufficient
basis for establishing 7d Group’s sufficient minimum contacts
with New York and the litigation. See HDtracks.com, 2019 WL
6170838, at *5, *7.

“The request, in other words, is to delve

further into the alter-ego theory that the Court rejected in
[the MTD Order] and rejects again today, or into the merits
themselves.” Vista Food Exch., 124 F. Supp. 3d at 313.

Topic #3

is not permitted as a general matter because it calls for
information relevant to whether general jurisdiction exists—HDT,
however, has never attempted to make out a case for such
jurisdiction over 7d Group and, indeed, it cannot. See Johnson
v. UBS AG, No. 18-2906, 2019 WL 5802323, at *2 (2d Cir. Nov. 7,
2019) (summary order) (“Aside from the truly exceptional case, a
corporation is at home and subject to general jurisdiction only

17

in its place of incorporation or principal place of business.”)
(quotation marks omitted).
Accordingly, because HDT has failed to establish that
jurisdictional discovery is necessary, its motion for leave to
conduct such discovery is denied. Cf. Jazini, 148 F.3d at 186
(“We recognize that without discovery it may be extremely
difficult for plaintiffs . . . to make a prima facie showing of
jurisdiction over a foreign corporation that they seek to sue in
the federal courts in New York.

That, however, is the

consequence of the problems inherent in attempting to sue a
foreign corporation that has carefully structured its business
so as to separate itself from the operation of its wholly-owned
subsidiaries in the United States—as it properly may do.

The

rules governing establishment of jurisdiction over such a
foreign corporation are clear and settled, and it would be
inappropriate for us to deviate from them or to create an
exception to them because of the problems plaintiffs may have in
meeting their somewhat strict standards.”).
III.

Conclusion

For the reasons set forth above, HDT’s motions for leave to
file a TAC or, alternatively, to conduct limited discovery are
DENIED.

7d Limited has already filed its answer and thus this

case will proceed to discovery before Magistrate Judge Parker.
The parties are directed to confer and file a joint-proposed

18

case management order within 30 days of the date of this Opinion
& Order.
The Clerk of Court is directed to terminate the motion
docketed at ECF No. 43.
SO ORDERED.

Dated:

New York, New York
February
, 2020

John F. Keenan
United States District Judge

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