13-1639-cv
Universal Trading & Investment Co., Inc. v. Credit Suisse (Guernsey) Ltd.

                                    UNITED STATES COURT OF APPEALS
                                        FOR THE SECOND CIRCUIT

                                                    SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY
FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN
CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE
EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
“SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY
PARTY NOT REPRESENTED BY COUNSEL.

        At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the
21st day of March, two thousand fourteen.

PRESENT:            BARRINGTON D. PARKER,
                    GERARD E. LYNCH,
                    CHRISTOPHER F. DRONEY,

                                                     Circuit Judges.

————————————————————————

Universal Trading & Investment Co., Inc., Foundation
Honesty International, Inc.,

                                                     Plaintiff-Appellants,

                               v.                                            Nos.   13-1639-cv

Credit Suisse (Guernsey) Ltd., Credit Suisse AG, Credit
Suisse Trust Ltd.,
                                     Defendant-Appellees,

Philip John Glanfield, Pamela Freda Kay Le Cheminant,
Julia Rosalind Church, and Does from 1 to 10.

                                                     Defendants.*

————————————————————————




           *
        The Clerk of Court is respectfully directed to amend the official caption in this case to
conform with the caption above.
FOR APPELLANT:                GEORGE LAMBERT, Esq., Law Offices of Leonard
                              Suchanek (Peter A. Joseph, Law Offices of Peter A. Joseph,
                              New York, New York, on the brief) Washington, District of
                              Columbia.

FOR APPELLEE:                 JULIE A. NORTH, Cravath, Swain, and Moore, LLP, New
                              York, New York.

       Appeal from the United States District Court for the Southern District of New York (Paul

A. Crotty, Judge).

       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the of the district court is AFFIRMED.

       Appellants Universal Trading & Investment Co., Inc. and Foundation Honesty

International, Inc., appeal from a judgment of the United States District Court for the Southern

District of New York dismissing their complaint. Appellants claimed that several entities

affiliated with Credit Suisse, as well as a number of the bank’s employees, helped a pair of rogue

Ukrainian officials to hide money rightfully due to appellants under a default judgment. The

complaint listed nine causes of action, all of which relied on the contention that Credit Suisse

knowingly laundered money for the corrupt officials. The district court dismissed the action for

lack of personal jurisdiction over all defendants except Credit Suisse AG, see Fed. R. Civ. P.

12(b)(2), and for failure to state a claim upon which relief can be granted, see Fed. R. Civ. P.

12(b)(6). On appeal, appellants argue that the district court had personal jurisdiction over the

dismissed Credit Suisse defendants, and that counts 1-3 and 5-8 of the complaint were either

adequately pled, or could have been sufficiently pled had appellants had an opportunity to amend

their complaint. We assume the parties’ familiarity with the facts, and the procedural history of

the case, to which we refer only as necessary to explain our decision.


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       We review the district court’s legal conclusions de novo on appeal. See Grand River

Enters. Six Nations, Ltd. v. Pryor, 425 F.3d 158, 165 (2d Cir. 2005) (standard of review for

dismissal for want of personal jurisdiction); Starr v. Sony BMG Music Entm’t, 592 F.3d 314, 321

(2d Cir. 2010) (standard of review for dismissal for failure to state a claim).

       1. Personal Jurisdiction

       Plaintiffs bear the burden of establishing that a court has jurisdiction over a defendant.

Bank of Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999).

“Specific personal jurisdiction exists when a forum exercises personal jurisdiction over a

defendant in a suit arising out of or related to the defendant's contacts with the forum; a court’s

general jurisdiction, on the other hand, is based on the defendant’s general business contacts with

the forum . . . and permits a court to exercise its power in a case where the subject matter of the

suit is unrelated to those contacts.” In re Terrorist Attacks on September 11, 2001, 714 F.3d 659,

673-74 (2d Cir. 2013) (quotation marks and brackets omitted).

       Nothing in appellants’ original complaint suggests, let alone supports a finding, that the

district court had either specific or general jurisdiction over Credit Suisse Guernsey (“CS

Guernsey”) or Credit Suisse Trust (“CS Trust”). Appellants’ complaint asserts jurisdiction over

the defendants based on two $460,000 transfers from Credit Suisse accounts to New York

accounts allegedly held by the Ukrainian officials. Although multiple transfers to a New York

account may establish minimum contacts with the state, a plaintiff must still establish “at a

minimum, a relatedness between the transaction[s] and the legal claim such that the latter is not

completely unmoored from the former.” Licci v. Lebanese Canadian Bank, SAL, 20 N.Y.3d 327,

339 (2012). Appellants alleged that the three Credit Suisse entities knew that the money they



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allegedly laundered through their accounts was lawfully owed to appellants. But both transfers

occurred in 1997, years before appellants filed the original suit that resulted in the default

judgment that would have put Credit Suisse on notice. Thus, it is impossible that the transfers

had any relationship, let alone a “substantial relationship,” to appellants’ current claim that the

banks knew appellants were owed money, and still helped the Ukrainian officials hide assets from

them. Id. at 333.

       Appellants’ proffered grounds for the district court’s general jurisdiction over CS

Guernsey and CS Trust are equally weak. To establish general jurisdiction, a plaintiff must set

forth facts of a “continuous and systematic course of doing business” in New York that

“warrant[s] a finding of [defendants’] presence” in the state. Laufer v. Ostrow, 55 N.Y.2d 305,

309-10 (1982) (quotation marks). Appellants stated in their complaint that CS Guernsey

maintained a bank account in New York, but that alone is not enough. We have previously held

that the “alleged use of a correspondent bank account[] . . . [is] insufficient to support the exercise

of general personal jurisdiction.” In re Terrorist Attacks on September 11, 2001, 714 F.3d 659,

680 (2d Cir. 2013). And appellants did not allege, for example, that CS Guernsey had offices in

New York, solicited business in New York, had a phone listing in New York, or had any

employees in New York. See Hoffritz for Cutlery, Inc. v. Amjac, Ltd., 763 F.2d 55, 58 (2d Cir.

1985) (listing factors to assess whether defendant conducted business in New York “with a fair

measure of permanence and continuity”). Appellants said even less about CS Trust’s connection

to New York: in their response to defendants’ motion in the district court, appellants pointed to

CS Trust’s admission that it had several American clients. But an allegation that a defendant

solicits business in the United States is not the same as one that the defendant conducts business



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in New York, and the district court correctly deemed the allegation insufficient to support specific

jurisdiction.1

        Appellants also argue that they should have been permitted to conduct jurisdictional

discovery. The standard for awarding jurisdictional discovery is low; plaintiffs need only plead

“legally sufficient allegations of jurisdiction” and may do so “through [their] own affidavits and

supporting materials[,] containing an averment of facts that, if credited . . ., would suffice to

establish jurisdiction over the defendant.” Whitaker v. Am. Telecasting, Inc., 261 F.3d 196, 208

(2d Cir. 2001) (internal quotation marks and citations omitted). The district court correctly held

that appellants failed to meet that burden, and did not err in declining to allow appellants to fish

for additional grounds of jurisdiction that they had not alleged.

        2. Failure to State a Claim

        In reviewing the district court’s grant of a motion to dismiss, we accept as true all factual

allegations in the complaint and draw all reasonable inferences in the plaintiff’s favor. Rothstein

v. UBS AG, 708 F.3d 82, 90 (2d Cir. 2013). At a minimum, a complaint must “contain sufficient

factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v.

Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted); Bell Atl. Corp. v. Twombly,

550 U.S. 544, 570 (2007).



 1
    Nor can appellants establish a basis for jurisdiction over CS Guernsey and CS Trust by
 pointing to the court’s power over Credit Suisse AG. As our Circuit has held, a parent
 company’s control over a subsidiary is generally not enough to subject the subsidiary to suit in
 New York courts, and jurisdiction is only proper “when the activities of the parent show a
 disregard for the separate corporate existence of the subsidiary.” Volkswagenwerk
 Aktiengesellschaft v. Beech Aircraft Corp.,751 F.2d 117, 120 (2d Cir. 1984). Thus, Credit
 Suisse AG’s admission of jurisdiction, including statements the company made in an unrelated
 deferred prosecution agreement with the Department of Justice, does not bear on the analysis of
 its subsidiaries’ contacts with New York state.

                                                   5
       As the district court correctly held, all of appellants’ claims fail as a matter of law. Counts

2, 3, and 5-8 are time-barred. Although the complaint lists many recent facts about the Ukrainian

officials who were the defendants in the prior action, the only alleged actions of the three Credit

Suisse entities occurred in the late 1990s. Appellants did not file their complaint until over a

decade later, well past the statute of limitations for claims sounding in tort. In addition, although

appellants now argue that conduct in 2012 by the appellees would defeat the application of the

statute of limitations, the complaint does not allege actionable conduct after the 1990s.

       Count 1 fails for a similar reliance on past events. Appellants seek turnover of assets

allegedly owned by the Ukrainian officials2 that are currently under the Credit Suisse defendants’

control. But the only specific allegation that those officials used a Credit Suisse account also date

back to the 1990s. Nowhere does the defendant proffer a basis to find that Credit Suisse still

holds any of the funds sought by the appellants.

       3. Amendment

       Finally, appellants argue that the district court erred by denying them leave to amend their

complaint. That contention is unavailing. First, it is unclear whether appellants ever timely

sought leave to amend their complaint. In their opposition to the motion to dismiss, they

requested “expedited jurisdictional discovery . . . with leave to supplement Plaintiffs’ response to

the MTD, and leave to amend.” J. App’x at 61. The request conditioned “leave to amend” on

the award of “expedited jurisdictional discovery,” implying that without further information about

the defendants, appellants had no means to cure the deficiencies in the complaint. Second, even if

2
  Technically, appellants seek assets allegedly belonging to the purported corporate parent of
United Energy Systems of Ukraine (“UESU”), and UESU proceeds allegedly held by the Credit
Suisse defendants in trusts for the benefit of the officials. For simplicity’s sake, here and
subsequently we use the terms “assets” or “funds” of the “Ukrainian officials” in this sense.

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appellants’ cursory request had been sufficient, the district court would have correctly deemed

any amendment futile as appellants did not, and still have not, pointed to a specific basis for the

exercise of jurisdiction over CS Guernsey or CS Trust, or to believe that a Credit Suisse entity

knowingly laundered money owed to appellants, or currently holds funds for the Ukrainian

officials. See Advanced Magnetics, Inc. v. Bayfront Partners, Inc., 106 F.3d 11, 18 (2d Cir.

1997). Finally, the district court correctly ruled that appellants’ Rule 59 motion failed to identify

any grounds sufficient to set aside the court’s judgment. See Ruotolo v. City of New York, 514

F.3d 184, 191 (2d Cir. 2008) (noting that a party seeking leave to amend a complaint after a case

is closed must first proffer a basis to set aside the judgment).

       We have reviewed each of appellant’s remaining arguments and find them to be without

merit. Accordingly, the judgment of the district Court is AFFIRMED.


                                       FOR THE COURT:
                                       Catherine O’Hagan Wolfe, Clerk of Court




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