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disregarding anti-jurisdictional facts that the defendant asserted in a memorandum of law, where the defendant did not include a supporting affidavit based on personal knowledge
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Case No.: 01-12974 (SMB), A. P. No. 03-3577
March 30, 2004
Denise L. Savage, Esq., JennyAnn Carles, Esq., SAVAGE ASSOCIATES, P.C., White Plains, NY, Of Counsel for Plaintiff
Joseph H. Smolinsky, Esq., Francisco Vazquez, Esq., Jeffrey I. Wasserman, Esq., CHADBOURNE PARKE LLP, NY, Of Counsel for Defendant
MEMORANDUM DECISION GRANTING MOTION TO DISMISS COMPLAINT WITH LEAVE TO AMEND AND DENYING MOTION FOR REARGUMENT AND REQUEST FOR SANCTIONS
The defendant Banda 26, S.A. ("Banda"), moves to dismiss the complaint pursuant to FED. R. CIV. p. 12(b)(2) based on lack of personal jurisdiction and pursuant to FED. R. CIV. p. 12(b)(4) based on the insufficiency of process. In addition, the plaintiff has moved for reconsideration of the decision refusing to consider her surreply, and Banda has moved for sanctions in response to the latter motion.
For the reasons discussed below, the motion to dismiss based on insufficiency of process is denied without prejudice, the motion to dismiss for lack of personal jurisdiction is granted without prejudice, and the reconsideration and sanction motions are denied.
BACKGROUND
A. The Complaint
The plaintiff was appointed under the debtor, Teligent's confirmed plan to prosecute the chapter 5 causes of action for the benefit of the unsecured creditors. She commenced this adversary proceeding against Banda on or about May 15, 2003, to recover alleged fraudulent conveyances in the sum of $4,756,812.46.
It appears that Banda is organized under the laws of Spain, and does not maintain a place of business either in New York or in the United States. In any event, the allegations relevant to personal jurisdiction over Banda were few. The Complaint merely stated that in November 1999, Banda entered into a joint venture agreement with Blescare — '98, a foreign subsidiary and insider of Teligent, and Blescare owned 40% of Banda. (Complaint 11 7, 8, 15.)
B. Banda's Motion to Dismiss
Banda filed a motion to dismiss the complaint for lack of personal jurisdiction and insufficiency of process. In the main, Banda argued that the complaint failed to allege any facts showing a basis for this Court's exercise of personal jurisdiction over it. (Motion to Dismiss Adversary Proceeding [etc.], dated Sept. 29, 2003, at ¶¶ 3, 12.) Banda also went outside the four corners of the complaint, and supplied additional information in its moving memorandum. According to its brief, Banda is a limited liability company organized under the laws of Spain, (Id., ¶¶ 2, 10), and maintains its principal offices in Madrid. (Id.) It does not have any assets or business operations in the United States, (Id. ¶¶ 2, 9), or purposely direct its activities at residents in the United States. (Id.) As a result, it is not doing business in New York pursuant to N.Y.C.P.L.R. 301 (McKinney 2001), (id., ¶¶ 8-9), or transacting business in New York within the meaning of N.Y.C.P.L.R. 302. (Id., ¶¶ 11-14.) In addition, the exercise of jurisdiction would offend notions of fair play and substantial justice. (Id., ¶¶ 15.)
Lastly, Banda argued that process was insufficient. According to its memorandum, the plaintiff mailed the summons and complaint to Banda in Spain. The plaintiff could not, Banda contended, use first class mail, and instead, had to effectuate service pursuant to FED. R. CIV. P. 4(f). It failed to do so, and its service was, therefore, insufficient. (Id., ¶¶ 15-16.)
C. The Plaintiff's Response
The plaintiff opposed the motion, and took issue with Banda's contention that it lacked contacts with New York or the United States. Like Banda, she did not submit an affidavit, but instead, amplified the record by attaching documents to her objection. According to the plaintiff, Banda "maintained active and continuous contact with the United States since its creation, including but not limited to the solicitation and acquisition of business, funding and expertise from Teligent and, upon information and belief, other American companies." (Plaintiff's Objection and Supporting Brief to Defendant's Motion to Dismiss [etc.], dated Oct. 30, 2003, ("Ob — lection"), at 5.)
The Objection suggested the following connections between Teligent and Banda: Teligent participated in meetings of Banda shareholders and communicated with Banda, Teligent guaranteed performance bonds for the benefit of Banda and funded Banda's operations through loans and/or capital contributions, Teligent agreed to provide technical assistance to Banda and Banda agreed to provide long-term employment contracts to Teligent employees, Teligent paid Banda's taxes and license fees for Banda, and Banda allowed Teligent to use certain installation rights belonging to Banda. (See Objection at 3-4.) Each allegation referred to a document attached to the memorandum.
As a consequence, the plaintiff argued, Banda was doing business in the United States within the meaning of N.Y.C.P.L.R. 301, (id. at 7-8), and was subject to long-arm jurisdiction in New York pursuant to N.Y.C.P.L.R. 302(a)(1). (Id. at 9-11.) Furthermore, the exercise of personal jurisdiction over Banda did not violate due process and was fair and reasonable. (Id. at 15.) In addition, the plaintiff maintained that "the very nature of this Adversary Proceeding may confer jurisdiction over this Defendant." (Id. at 15.)
Lastly, the plaintiff disputed the notion that the service of process was insufficient. (Id. at 15-17.) She acknowledged that Banda had to be served in accordance with the Hague Convention. She predicted that this could take between three and nine months, and stated that she had initiated the process. Furthermore, although Banda did not raise the issue, the plaintiff observed that the 120 day time limit within which the summons and complaint must be served did not apply to service in a foreign country. See FED. R. CIV. P. 4(m).
The plaintiff annexed an affidavit of Gary Crowe, a specialist in the service of civil process in foreign countries. (Objection, Ex. F.)
The plaintiff concluded her opposition with a plea for alternative relief. If the Court decided that the plaintiff had failed to establish aprima facie case for personal jurisdiction over Banda, the plaintiff sought leave to take discovery. (Id. at 18.)
The issue of discovery had come up once before. At an October 9, 2003 initial conference, Banda suggested that the plaintiff would need to take discovery. (Transcript of hearing, held Oct. 9, 2003, at 22.) The plaintiff confirmed that the motions to dismiss based on lack of personal jurisdiction over international defendants, such as Banda, "may be a little more complex." (Id. at 23.) The Court advised the Estate Representative to attempt to obtain whatever discovery she could prior to the November 25th return date set for Banda's motion. To the extent that the she was unable to obtain discovery, she could raise the issue at that time. (Id. at 23.)
On the return date of the motion, the plaintiff indicated that she needed and should be entitled to take discovery. (Transcript of hearing, held Nov. 25, 2003 ("Tr. 11/25/03"), at 88.) Banda objected on the ground that she had failed to make a prima facie showing of personal jurisdiction, a prerequisite to any discovery. (Id. at 90-91.) The plaintiff's right to discovery is addressed in the text below.
Banda filed a reply that responded to the opposition and largely reiterated the position that the plaintiff had failed to demonstrate aprima facie case for personal jurisdiction. In addition, Banda again emphasized that the plaintiff had failed to serve process in accordance with the Hague Convention.
D. The Plaintiff's Surreply
One day before the hearing on Banda's motion, the plaintiff served and filed an unauthorized surreply that raised a new jurisdictional theory. The plaintiff argued that Banda was the alter ego of its indirect corporate parent, Jazztel p.l.c. ("Jazztel"), an entity allegedly subject to this Court's jurisdiction. Alternatively, Jazztel and Banda acted as each other's agents. The Court ruled that it would not consider the unauthorized surreply. (Tr. 11/25/03, at 88.)
The plaintiff served the surreply by first class mail. (See ECF Doc. # 23)(Certificate of Service, dated Nov. 24, 2003.) Plaintiff had to know that the first class mailing would not reach Banda's counsel prior to the hearing.
According to the surreply, Jazztel owns 100% of Jazz Telecom, S.A., a Spanish entity ("Jazztel Spain"). Jazztel Spain presently owns 91% of Banda, but at the time of the transfer, owned a smaller percentage.
Despite the ruling, the Court heard some oral argument regarding the Jazztel entities. Jazztel Spain had increased its equity interest in Banda after the alleged fraudulent transfers and before the plaintiff commenced this adversary proceeding. The Court asked the parties to file supplemental briefs on a narrow issue: what was the relevant point in time — the transfer or the start of the litigation — in analyzing whether an alter ego/agency relationship existed between Banda and Jazztel for the purpose of establishing personal jurisdiction. In light of the decision on the pending motion, it is unnecessary to consider the issue at this time.
DISCUSSION
A. Insufficient Process
Banda challenged the defects in the service of the summons and complaint through a motion to dismiss under FED. R CIV. p. 12(b)(4). FED. R CIV. P. 12(b)(4) authorizes the Court to dismiss the complaint based upon insufficient process, while FED. R CIV. P. 12(b)(5) permits dismissal based upon the insufficiency of the service of process. The former addresses irregularities in the "form" of the process; the latter deals with "irregularities" in the "method" of service. 2 JAMES WM. MOORE, MOORE'S FEDERAL PRACTICE § 12.33[1], at 12-51 (3rd ed. 2003). Nevertheless, court's frequently treat these two subparagraphs, as "more or less interchangeable," Id., and the plaintiff ignored Rule 12(b)(4), and treated the motion as having been made under Rule 12(b)(5). (Objection, at 16.) Accordingly, I will too.
Banda did not identify any defects in the form of the summons and complaint.
The parties agree that FED. R. CIV. p. 4(f), made applicable by FED. R. BANKR. p. 7004, governs the service of process on Banda. Rule 4(f) states in pertinent part:
Unless otherwise provided by federal law, service upon an individual . . . may be effected in a place not within any judicial district of the United States: (1) by any internationally agreed means reasonably calculated to give notice, such as those means authorized by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents. . . .
Spain is a signatory to the Hague Convention, but it is unnecessary to address the requirements for service under the Hague Convention; whatever they are, the plaintiff failed to show that she met them. After she obtained a new summons on October 20, 2003, she sent the summons and complaint to Alan H. Crowe Associates, Inc., d/b/a Crowe Foreign Services, for service in Spain in accordance the Hague Convention. (Objection, Ex. F, ¶ 6.) According to Crowe's affidavit, which was dated October 29, 2003, he expected to complete the translation of the documents into Spanish by November 10, 2003, and then forward the documents to the Central Authority in Madrid for service on Banda. The docket sheet in this adversary proceeding does not reflect that any service has ever been made.
Nevertheless, it does not follow that the adversary proceeding should be dismissed on this ground. Although a plaintiff must ordinarily serve the summons and complaint within 120 days of the filing of the complaint, the 120 day limitation does not apply to service in a foreign country under FED. R. CIV. p. 4(f). This does not mean that the plaintiff enjoys an unlimited amount of time to effectuate service. A court may still dismiss a case involving the failure to serve a foreign defendant within a reasonable time under the "flexible due diligence" standard. Official Committee of Unsecured Creditors of Southold Dev. Corp. v. Mittemyer (In re Southold Dev. Corp.), 148 B.R. 726, 730 (E.D.N.Y. 1992). Where, however, the delay is relatively brief, the defendant must demonstrate hardship or prejudice from the delay. Id.
FED. R. CIV. P. 4(m) provides:
If service of the summons and complaint is not made upon a defendant within 120 days after the filing of the complaint, the court, upon motion or on its own initiative after notice to the plaintiff, shall dismiss the action without prejudice as to that defendant or direct that service be effected within a specified time; provided that if the plaintiff shows good cause for the failure, the court shall extend the time for service for an appropriate period. This subdivision does not apply to service in a foreign country pursuant to subdivision (f) or (j)(1)
Here, the evidence implies that the plaintiff failed to exercise due diligence in serving the summons and complaint. The first summons, issued on May 28, 2003, was never forwarded for service. On October 20, 2003, she obtained a second summons, and initiated steps to serve Banda in Spain under the Hague Convention. Despite the unexplained delay, Banda did not argue that it was prejudiced by the delay. Consequently, the complaint should not be dismissed for insufficient service at this point. This conclusion is without prejudice to Banda's right to renew its motion if the plaintiff fails to effect service within a reasonable time.
The plaintiff apparently sent the summons and complaint to Banda in Spain at an earlier date by ordinary mail. The mailing did not satisfy the Hague Convention, and the plaintiff did not explain why she waited five months — and after Banda's motion was filed — to serve Banda under the Hague Convention.
B. Lack of Personal Jurisdiction
1. Introduction
On a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of proving that the court has jurisdiction over the defendant. In re Magnetic Audiotape Antitrust Litigation, 334 F.3d 204, 206 (2d Cir. 2003); Whitaker v. American Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2001). The nature of the burden depends, in the first instance, on the status of the action. InBall v. Metallurgie Hoboken — Overpelt, S.A., 902 F.2d 194 (2d Cir.),cert. denied, 498 U.S. 854 (1990), the Second Circuit explained:
Prior to discovery, a plaintiff challenged by a jurisdiction testing motion may defeat the motion by pleading in good faith, see Fed.R.Civ.P. 11, legally sufficient allegations of jurisdiction. At that preliminary stage, the plaintiff's prima facie showing may be established solely by allegations. After discovery, the plaintiff's prima facie showing, necessary to defeat a jurisdiction testing motion, must include an averment of facts that, if credited by the trier, would suffice to establish jurisdiction over the defendant.
Id. at 197 (citations omitted).
Here, Banda moved to dismiss under Rule 12(b)(2) before discovery, challenging the legal sufficiency of the plaintiff's jurisdictional allegations which we take as true. Banda also attempted to inject evidence beyond the four corners of the complaint, including a recitation of "anti-jurisdictional" facts in its memorandum of law. Banda did not, however, submit a supporting affidavit based on personal knowledge, or move for summary judgment. Its inclusion of unsupported factual information in its brief was improper, and will not be considered. Accordingly, the plaintiff may defeat Banda's motion by demonstrating that her complaint pleads legally sufficient allegations that establish aprima facie case. 2. The Plaintiff's Jurisdictional Theories
The plaintiff can also establish her prima facie case through the use of affidavits and supporting materials. See, e.g., Whitaker v. American Telecasting. Inc., 261 F.2d at 208; In re Ski Train Fire in Kaprun Austria on Nov. 11, 2000, 230 F. Supp.2d 403, 406 (S.D.N.Y. 2002). The plaintiff did not submit any affidavits, but instead, attached several documents to her opposition brief. She argued that the documents showed a close connection or business relationship between Banda and Teligent. The documents are considered in the succeeding text.
The plaintiff's opposition relied on two Jurisdictional theories under the N.Y.C.P.L.R. — doing business and transacting business, also known as "long arm" jurisdiction. The traditional indicia of doing business under the N.Y.C.P.L.R. include "(1) whether the company has an office in the state; (2) whether it has any bank accounts or other property in the state; (3) whether it has a phone listing in the state; (4) whether it does public relations work there; and (5) whether it has individuals permanently located in the state to promote its interests." In re Ski Train Fire in Kaprun Austria, 230 F. Supp.2d at 407. "Casual or occasional activity does not constitute doing business; rather, CPLR § 301 requires a showing of 'continuous, permanent, and substantial activity in New York.'" Id. (quoting Landoil Res. Corp. v. Alexander Alexander, Inc., 918 F.2d 1039, 1043 (2d Cir. 1990)).
The N.Y.C.P.L.R. is concerned with the defendant's contacts with New York. The focus in this decision is on Banda's contacts with the United States, not just New York.
A defendant may also be subject to personal jurisdiction if he "transacts any business within the state or contracts to supply goods or services in the state," and the plaintiff's cause of action arises from the act that confers jurisdiction. N.Y.C.P.L.R. 302(a)(1). To establish "long-arm" jurisdiction, the plaintiff must show "some articulable nexus between the business transacted and the cause of action." McGowan v. Smith, 52 N.Y.2d 268, 272 (1981). "No single event or contact connecting the defendant to the forum state need be demonstrated; rather, the totality of all defendant's contacts with the forum state must indicate that the exercise of jurisdiction would be proper." Cutco Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986). The inquiry centers on the defendant's activities, and does not consider the plaintiff's. In re Commodore Int'l, Ltd., 242 B.R. 243, 253 (Bankr. S.D.N.Y. 1999), aff'd, No. 00 Civ. 1679 (SAS), 2000 WL 977681 (S.D.N.Y. July 17, 2000).
The plaintiff's separate "nature of the action" theory is merely a variation of the traditional theories of general and specific jurisdiction. This is evident from the only decision that she cited, A W Publishers. Inc. v. Bison Books Ltd. (In re A W Publishers. Inc.). 39 B.R. 666 (S.D.N.Y. 1984). There, the debtor, an American book buyer, sued to avoid and recover pre-petition and post-petition transfers made under its settlement agreement with a British book seller. Normally, the Court observed, "settlement efforts may not be relied on to create a basis for jurisdiction." Id. The case before it was an exception, however, because the settlement was the "central part of the means by which appellant obtained the unlawful preferential and post-petition payments challenged in this case." Id. The defendant "purposely availed" itself of the privilege of conducting business in New York and/or the United States by collecting the settlement payments in Connecticut, using a subsidiary and an American bank, and hiring a New York lawyer to enforce a confession of judgment in New York if the debtor defaulted. Id.
Here, the plaintiff did not plead or offer evidence that Teligent or Banda entered into a settlement agreement, or that the fraudulent transfers she sued to recover were the product of such an agreement. To the contrary, ¶ 10 in the complaint alleged that Teligent did not have a contractual obligation to make the payments. Moreover, reliance on a settlement agreement would defeat her cause of action. The payment of an antecedent debt is a complete defense to a constructive fraudulent transfer claim. Pereira v. Dow Chemical Co. (In re Trace Int'l Holdings Inc.). 301 B.R. 801, 805 (Bankr. S.D.N.Y. 2003).
Finally, the plaintiff's surreply raised a new "alter ego" theory of personal jurisdiction based on Banda's relationship to its indirect parent, Jazztel, and its direct parent, Jazztel Spain. I declined to entertain the theory, and mention it here only for the sake of completeness. Where a claim of personal jurisdiction over a foreign corporation is based on the activities of an affiliate, the presence of the affiliate alone does not establish the foreign subsidiary's presence in the state. Jazini v. Nissan Motor Company, Ltd., 148 F.3d 181, 184 (2d Cir. 1998); Delagi v. Volkswagenwerk AG of Wolfsburg, Germany, 29 N.Y.2d 426, 432 (1972). "For New York courts to have personal jurisdiction in that situation, the foreign subsidiary must either be an "agent" or a "mere department" of the foreign parent." Jazini v. Nissan Motor Company, 148 F.3d at 184.
It appears that the plaintiff used "alter ego" as a synonym for "mere department" or agency.
To prove that a subsidiary is a "mere department" of its parent, the plaintiff must show that the parent must exercises such "complete control" over the activities of the subsidiary that it is "in fact, merely a department of the parent." Delagi v. Volkswagenwerk, 29 N.Y.2d at 432. Courts generally consider four factors: (1) "common ownership" which is "essential"; (2), "financial dependency of the subsidiary on the parent corporation"; (3), "the degree to which the parent corporation interferes in the selection and assignment of the subsidiary's executive personnel and fails to observe corporate formalities, — " and (4), "the degree of control over the marketing and operational policies of the subsidiary exercised by the parent." Volkswagenwerk Aktiengensellschaft v. Beech Aircraft Corp., 751 F.2d 117, 120-22 (2d Cir. 1984). Under the agency theory, "a foreign corporation is doing business in New York . . . when its representative provides services beyond 'mere solicitation' and these services are sufficiently important to the foreign corporation that if it did not have a representative to perform them, the corporation's own officials would undertake to perform substantially similar services."Gelfand v. Tanner Motor Tours, Ltd., 385 F.2d 116, 121 (1967), cert. denied, 390 U.S. 996 (1968); accord, Jazini v. Nissan Motor Company, 148 F.3d at 184.
With these standards in mind, we turn to the consideration of whether the plaintiff established a prima facie case of personal jurisdiction over Banda.
3. The Plaintiff's Prima Facie Case
It would be an understatement to describe the plaintiff's jurisdictional allegations as legally insufficient. They were limited to the following: Blescare — '98, a foreign non-debtor subsidiary of Teligent, owns 40% of Banda. As pleaded, the plaintiff's entire jurisdictional theory rested on the fact Teligent's foreign affiliate, which itself did not appear to have any meaningful contact with the United States, owned a piece of Banda. This "relationship," without more, is insufficient to establish personal jurisdiction under the plaintiff's theories.
Furthermore, the documents attached to the plaintiff's opposition did not cure the pleading defects. They tended to confirm that Banda did business in Spain, and to the extent that it did business with Teligent, that business was centered in Spain. In short, the documents did not support the plaintiff's argument that Banda is or ever was present in New York or the United States on a regular or continuous basis.
They also failed to show that Banda is subject to "long-arm" jurisdiction. The documents did not reflect the transaction of business in New York or the United States. At most, they showed business transactions, centered in Spain, with entities located in the United States. Furthermore, the plaintiff did not identify the basis of the alleged fraudulent payments. Hence, she did not show that her claims arose out of a transaction of business or contract that might form the basis of "long-arm" jurisdiction.
My conclusions also apply to the analogous theories of general and specific jurisdiction under federal common law. "General jurisdiction" is based on a "defendant's general business contacts with the forum state and permits a court to exercise its power in a case where the subject matter of the suit is unrelated to those contacts. Because general jurisdiction is not related to the events giving rise to the suit, courts impose a more stringent minimum contacts test, requiring the plaintiff to demonstrate the defendant's 'continuous and systematic general business contacts.'" Metropolitan Life Insurance Co. v. Robertson — Ceco Corp., 84 F.3d 560, 568 (2d Cir. 1996) quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (1984). This test is similar to New York's doing business test under N.Y.C.P.L.R. 301.
To establish the minimum contacts necessary to justify "specific jurisdiction," the plaintiff first must show that its claim arises out of or relates to defendant's contacts with the forum state. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984). The plaintiff must also show that the defendant "purposefully availed" himself of the privilege of doing business in the forum state and that the defendant could foresee being "haled into court" there. See World — Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980); Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985). This requirement forecloses the possibility that a defendant will be hauled into a forum as a result of random, fortuitous or attenuated contacts, Burger King, 471 U.S. at 475, and parallels "long-arm" jurisdiction under New York law.
Finally, while I have declined to consider the plaintiff's belated alter ego/agency argument, I note that the documents attached to the surreply fail to show the degree of domination, control or conduct that are required under these theories.
C. Plaintiff's Request For Jurisdictional Discovery
Having concluded that the plaintiff failed to make a prima facie showing of personal jurisdiction, I turn to her alternative request for discovery. "Discovery need not be granted to allow [a] plaintiff to engage in an unfounded fishing expedition for jurisdictional facts."Gear, Inc. v. L.A. Gear California, Inc., 637 F. Supp. 1323, 1328 (S.D.N.Y. 1986). As a rule, a plaintiff is not entitled to jurisdictional discovery to enable her to bolster an inadequate pleading if the defendant merely challenges the legal sufficiency of the jurisdictional allegations in the complaint, and does not place the factual basis for personal jurisdiction in issue. See In re Magnetic Audiotape, 334 F.3d at 208.
This concern is even greater where the defendant is a multinational foreign corporation. If sparse jurisdictional allegations, like those in this case, could force a foreign defendant to submit to discovery, the federal courts would be required "to conduct substantial jurisdictional discovery over foreign corporations — a practice in which they have not hitherto engaged." Jazzini v. Nissan Motor Co., 148 F.3d at 185-86.
Here, the plaintiff failed to demonstrate that she should be entitled discovery because she failed to allege a prima facie case of personal jurisdiction. Accordingly, her alternative request to conduct jurisdictional discovery is denied, and Banda's motion to dismiss for a lack of personal jurisdiction under FED. R. CIV. p. 12(b)(2), is granted.
In light of this ruling, the Court need not address Banda's separate contention that it cannot be forced to provide discovery because it has not been served with process. See Application of Royal Bank of Canada, 33 F.R.D. 296 (S.D.N.Y. 1963).
The dismissal, however, is without prejudice. The plaintiff will be afforded another opportunity to plead legally sufficient, non-conclusory allegations, see Jazini v. Nissan Motor Co., 148 F.3d at 185, establishing a prima facie case of personal jurisdiction over Banda, provided that she files an amended complaint within thirty days of this opinion. It may be that the plaintiff can cull sufficient jurisdictional facts from the documents she attached to her submissions to plead a prima facie case. Although this may prove difficult without discovery, the Second Circuit answered this dilemma in Jazini:
[W]ithout discovery it may be extremely difficult for plaintiffs in the Jazinis' situation to make a 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. . . . The rules governing establishment of jurisdiction over such a foreign corporation are clear and settled, and it would be inappropriate . . . to deviate from them or to create an exception to them because of the problems plaintiffs may have in meeting their somewhat strict standards."
Jazini v. Nissan Motor Co., 148 F.3d at 186.
D. Reconsideration and Sanctions
The remaining issues require only brief comment. Following the November 25th hearing, the plaintiff moved for reconsideration of the Court's refusal to consider the surreply. She maintained that after declining to consider the surreply, the Court heard extensive argument on the issues raised in the surreply, and even requested additional briefing related to some of those issues. In response, Banda charged that the motion for reconsideration was procedurally improper and frivolous. Banda sought costs and attorneys' fees pursuant to FED. R. BANKR. p. 9011, 28 U.S.C. § 1927, and the inherent powers of the Court.
The motion for reconsideration is denied as moot. The complaint is being dismissed without prejudice. The plaintiff will have another opportunity to allege a prima facie case of personal jurisdiction, and if appropriate, incorporate any facts that the materials in the surreply support.
The request for sanctions is also denied. The motion for reconsideration was prompted, in part, by the confusion created by the Court. Although I declined to considered the surreply, the plaintiff correctly noted that I heard argument on some of the matters raised in the surreply, and requested additional briefing on a narrow point. Under the circumstances, the reconsideration motion was neither frivolous nor procedurally improper.
CONCLUSION
The motion to dismiss based on the failure to serve process is denied with out prejudice, the motion to dismiss for lack of personal jurisdiction pursuant to FED. R. CIV. p. 12(b)(2) is granted without prejudice to filing an amended complaint provided that the plaintiff files her amended complaint within thirty days of the date of this opinion. The motion for reconsideration and the request for sanctions are denied. Settle order on notice.