Opinion
00 Civ. 1522 (DAB)(FM).
November 22, 2000.
REPORT AND RECOMMENDATION TO THE HONORABLE DEBORAH A. BATTS
I. Introduction
In this contract action, plaintiff Jordan Barness ("Barness") seeks to recover a finder's fee from defendant Madison Securities, Inc. ("Madison"), an investment banking firm, for his role in introducing Madison to Churchill Environmental Industrial Equity Partners, L.P. ("CEIEP"), which subsequently made a $12,000,000 equity investment in a Madison client. Madison has moved to dismiss the complaint, pursuant to Fed.R.Civ.P. 12(b)(2), for lack of personal jurisdiction. For the reasons set forth below, I recommend that this motion be denied.
II. Background
A. Jurisdictional Facts
Viewed in the light most favorable to the Plaintiff, the relevant facts are as follows:
Barness is a citizen and resident of New York and an attorney admitted to practice law here. (Compl. ¶ 1). Madison is an investment banking firm incorporated in Delaware with its principal place of business in Chicago, Illinois. (Id. ¶ 2; Gleaves Aff. ¶ 2). William Gleaves ("Gleaves") is a Senior Vice President of Investments for Madison, (Compl. ¶ 6; Gleaves Aff. ¶ 1).
In December 1998, Asche Transportation Services, Inc. ("Asche"), a Delaware corporation with its principal place of business in Illinois, retained Madison to act as the selling agent for a private placement of Asche common stock. (Gleaves Aff. ¶ 3). At or about the same time, Barness telephoned Gleaves in his Chicago, Illinois office and learned that Gleaves was seeking investors for Asche. (Gleaves Aff. ¶¶ 6-7; Barness Aff. ¶¶ 2-3). During the course of this conversation, Barness suggested Perry Scheer ("Scheer"), a New York investment banker, as a potential source of funds. (Barness Aff. ¶ 3).
Shortly after the December conversation, Gleaves telephoned Barness in his New York office to inform him that the deal with Scheer was "not going to work out." (Id. ¶ 4). As an alternative, Barness suggested that Gleaves contact John Quirk ("Quirk"), the principal of Churchill Capital, Inc. ("Churchill"), in New York. (Id.; Quirk Aff. ¶ 1). Churchill is the managing general partner of CEIEP, a limited partnership with its principal place of business in New York City. (Compl. ¶ 11; Quirk Aff. ¶ 3).
In or around January 1999, after receiving his name and telephone number from Barness, Gleaves called Quirk to determine whether Churchill or CEIEP were interested in making an equity investment in Asche. (Quirk Aff. ¶ 4). Over the ensuing months, Quirk engaged in a series of conversations with Gleaves and executives of Asche to negotiate the terms of a deal between CEIEP and Asche. (Quirk Aff. ¶ 5; Gleaves Aff. ¶ 5). Contract negotiations also took place on or about March 12, 1999, during a meeting at Quirk's office in New York City that Gleaves attended. (Quirk Aff. ¶ 6).
Although his affidavit does not indicate where Quirk was at the time of this call, his office is located in New York. (Quirk Aff. ¶¶ 1-2).
On or about March 18, 1999, Barness and Quirk initiated a telephone conference call with Gleaves. (Compl. ¶¶ 16, 18). During their conversation, Barness expressed dismay because Gleaves evidently had failed to tell Quirk that Barness was the person who had made the introduction of Madison to CEIEP. (Barness Aff. ¶ 7). In response, Gleaves acknowledged that Barness had introduced Quirk and CEIEP to Madison, and he offered to send a letter confirming that fact. (Id.). Shortly after that call, Gleaves sent a letter to Barness in New York thanking him for introducing Madison to CEIEP.
A copy of the letter sent by Madison to Barness, dated March 18, 1999, is annexed to the complaint as Exhibit A.
In or around July or August 1999, Gleaves met with Barness at Barness's office in New York City. (Compl. ¶ 19; Gleaves Aff. ¶ 9). At that meeting, Gleaves informed Barness that Asche and Churchill intended to sign a letter of intent shortly. (Compl. ¶ 19). Barness alleges that Gleaves also confirmed during this meeting that Madison would pay Barness the "customary" finder's fee for his services. (Id.).
According to Gleaves, this meeting lasted only "15 to 20 minutes." (Gleaves Aff. ¶ 9). Gleaves also denies that he agreed to pay Barness a finder's fee during the meeting. (Id.).
In late September 1999, CEIEP purchased approximately 2.6 million shares of Asche common stock for $12 million as part of a transaction which was closed at the New York City offices of the Rogers Wells law firm. (Compl. ¶ 20; Quirk Aff. ¶ 7; see Williams Aff. Ex. D (Asche Definitive Proxy Statement, dated Aug. 18, 1999)). For its services in connection with this transaction, Madison received a finder's fee of approximately $1 million. (Compl. ¶ 21). Barness contends that he, in turn, is entitled to a fee of "no less than $250,000," in keeping with "industry custom and practice." (Id. ¶ 22).
The complaint is silent as to Madison's presence at the closing, but Gleaves has represented that "[n]either I nor anyone else from Madison attended or participated in the closing for the investment by [CEIEP] in [Asche], which occurred on or about September 28, 1999." (Gleaves Reply Aff. ¶ 2).
B. Complaint
The complaint contains four separate claims. In his first cause of action, Barness contends that Madison breached its binding agreement to pay him a finder's fee "upon consummation of the equity investment by CEIEP in Asche." (Id. ¶¶ 24-29). Barness's second cause of action alleges that the failure to pay him the requested fee constitutes a breach of Madison's implied covenant of good faith and fair dealing under its oral agreement with him. (Id. ¶¶ 30-36). In his third cause of action, Barness contends that, because the CEIEP investment in Asche would not have occurred without his efforts, Madison's refusal to make payment to him constitutes "[u]njust [e]nrichment." (Id. ¶¶ 37-39). Finally, in his fourth cause of action, Barness alleges that "[e]quity requires that [Barness] be compensated for the reasonable value of his efforts, as determined by industry custom and practice." (Id. ¶¶ 40-43).
C. Madison's Motion
Madison has moved to dismiss the complaint, pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure, for lack of personal jurisdiction. Madison contends that there is no basis for personal jurisdiction under applicable New York law because Barness has failed to show that Madison "transacted" business in New York and that his claims arise out of that transaction of business in New York.
There has been no evidentiary hearing in this case. Accordingly, this Report and Recommendation is based solely upon the papers submitted by the parties.
III. Discussion
A. Legal Standard
A defendant seeking dismissal of a complaint pursuant to Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction bears the burden of showing that the court has jurisdiction over the defendant. Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566 (2d Cir. 1996); Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 507 (2d Cir. 1994); Kahn Lucas Lancaster, Inc. v. Lark Int'l Ltd., 956 F. Supp. 1131, 1134 (S.D.N Y 1997) (Cote, J.). The showing required varies depending upon the procedural posture of the case. Prior to discovery, the plaintiff need only make a prima facie showing of facts which, if proved, would be sufficient to establish personal jurisdiction over the defendant, and any pleadings and affidavits considered by the Court must be interpreted in the light most favorable to the plaintiff. See PDK Labs, Inc. v. Friedlander, 103 F.3d 1105, 1108 (2d Cir. 1997); A.I. Trade Fin., Inc. v. Petra Bank, 989 F.2d 76, 79-80 (2d Cir. 1993); First Wall Street Capital Corp. v. International Prop. Corp., No. 97 Civ. 0702, 1998 WL 338105, at *3 (S.D.N.Y. June 24, 1998) (Koeltl, J.). On the other hand, if an evidentiary hearing is held after jurisdictional discovery has been taken, a plaintiff must demonstrate the existence of personal jurisdiction over the defendant by a preponderance of the evidence. Metropolitan Life, 84 F.3d at 566; Volkswagenwerk Aktiengesellschaft v. Beech Aircraft Corp., 751 F.2d 117, 120 (2d Cir. 1984). Under either alternative, in assessing whether there is a basis for personal jurisdiction, courts must be "mindful that personal jurisdiction inquiries are 'necessarily fact sensitive because each case is dependent upon its own particular circumstances.'" PDK Labs, 103 F.3d at 1108 (quoting Landoil Res. Corp. v. Alexander Alexander Servs. Inc., 918 F.2d 1039, 1043 (2d Cir. 1991)).
B. Applicable Law
The complaint indicates that subject matter jurisdiction in this case is predicated on diversity of citizenship. (See Compl. ¶ 3). In a diversity action, the Court must first apply the "long-arm" jurisdiction statute of the forum state to determine whether it has personal jurisdiction over a non-resident defendant. See Agency Rent A Car Sys., Inc. v. Grand Rent A Car Corp., 98 F.3d 25, 29 (2d Cir. 1996); Savin v. Ranier, 898 F.2d 304, 306 (2d Cir. 1990); Arrowsmith v. United Press Int'l, 320 F.2d 219, 223 (2d Cir. 1963); PaineWebber Inc. v. WHV, Inc., No. 95 Civ. 0052, 1995 WL 296398, at *2 (S.D.N.Y. May 16, 1995) (McKenna, J.). Here, the relevant New York statute is Section 302(a)(1) of the New York Civil Practice Law and Rules ("CPLR"). Second, even if the defendant's activities are found to meet the statutory requirements, the Court must determine whether the exercise of jurisdiction comports with the requirements of due process. Metropolitan Life, 84 F.3d at 567.
In this case, Madison has not raised any constitutional concern that its contacts with New York State are so attenuated as to offend the "minimum contacts" test of International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945). Consequently, the only issue to be addressed is whether the statutory requirements for long-arm jurisdiction have been met. See Kahn Lucas, 956 F. Supp. at 1134.
CPLR § 302(a)(1) provides, in pertinent part, that:
As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any non-domiciliary . . . who in person or through an agent:
1. transacts any business within the state. . . .
For this court to exercise jurisdiction over a non-domiciliary under CPLR § 302(a)(1), two conditions must therefore be met: (1) the non-domiciliary defendant must transact business within New York; and (2) the cause of action must arise out of that business activity. See CutCo Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986); PaineWebber, 1995 WL 296398, at *2 (citing United States Theatre Corp. v. Gunwyn/Lansburgh Ltd., 825 F. Supp. 594, 595 (S.D.N Y 1993) (Conboy, J.)).
1. Transacting Business
To meet the "transacting business" element of CPLR § 302(a)(1), a plaintiff must show that the defendant "purposely avail[ed] itself of the privilege of conducting activities within [New York], thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958), quoted in PaineWebber, 1995 WL 296398, at *2; McKee Elec. Co. v. Rauland-Borg Corp., 20 N.Y.2d 377, 382, 229 N.E.2d 604, 607, 283 N.Y.S.2d 34, 37-38 (1967). To determine the existence of purposeful activity, a Court must look to "the totality of the circumstances and may not ground jurisdiction upon 'random,' 'fortuitous,' or 'attenuated' contacts." Packer v. TDI Sys., 959 F. Supp. 192, 197 (S.D.N Y 1997) (Leisure, J.) (citing CutC o Indus., 806 F.2d at 365, and Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 2183-84, 85 L.Ed.2d 528 (1985)).
The Second Circuit has enumerated various factors to consider in a contract action to determine whether a non-domiciliary has transacted business in New York. Included among those factors are "whether the contract was negotiated or executed in New York, and whether, after executing a contract with a New York business, the defendant has visited New York for the purpose of meeting with parties to the contract regarding the relationship." Agency Rent A Car, 98 F.3d at 29 (citations omitted). Although a single meeting in New York may be sufficient to justify the exercise of jurisdiction, First Wall Street Capital, 1998 WL 338105, at *4, it must be essential to the formation or continuation of the parties' business relationship, Cantor Fitzgerald, L.P. v. Peaslee, 88 F.3d 152, 156 (2d Cir. 1996); First Wall Street Capital, 1998 WL 338105, at *4; Kahn Lucas, 956 F. Supp. at 1136.
In this case, the complaint and affidavits submitted by Barness set forth facts which, if established at trial, would plainly support the conclusion that Madison transacted business in New York within the meaning of CPLR § 302(a)(1). Specifically, Barness contends that Gleaves made at least one telephone call to him in New York seeking sources of capital for Asche. Thereafter, Gleaves had frequent telephone conversations with Quirk in New York to negotiate the terms of the stock purchase transaction. (See Quirk Aff. ¶ 5). Gleaves also traveled to New York in early May 1999 to discuss CEIEP's proposed investment in Asche with Quirk. (See id. ¶ 6).
In the course of one of his trips to New York City in connection with the Asche deal, Gleaves also met with at Barness at his office. During that meeting, Gleaves allegedly advised Barness that a letter of intent between Asche and Churchill was going to be signed shortly, and he confirmed that Barness would receive a finder's fee from Madison for his services. (Compl. ¶ 19).
Finally, the Asche stock purchase transaction was closed in New York City during September 1999. Although Gleaves has averred that no representative of Madison was present at the closing, it appears undisputed that Madison received a $1 million fee in connection with that transaction.
In its motion papers, Madison focuses on the paucity of evidence to support Barness's claim for a finder's fee, contending that any negotiations regarding that fee lack a sufficient New York nexus to constitute the transaction of business here. For example, Madison characterizes Gleaves' visit to Barness's office during the summer of 1999 as a mere "courtesy call" which is insufficient to confer this Court with jurisdiction over Madison. (Def.'s Mem. of Law at 7). Madison also correctly notes that Barness has failed to aver either that he and Gleaves agreed on a sum that Madison would pay to him as a fee or a formula pursuant to which that fee could be calculated. (Id. at 3 n. 2). Thus, at a later stage of this lawsuit, Madison may well be entitled to summary judgment on the basis that there never was a binding agreement here. See Hutner v. Greene, 734 F.2d 896, 900 (2d Cir. 1984) ("Under New York law, . . . custom and usage evidence must establish that the omitted term is 'fixed and invariable' in the industry in question."); Cleveland Wrecking Co. v. Hercules Constr. Corp., 23 F. Supp.2d 287, 292-94 (E.D.N.Y. 1998) ("Because it is axiomatic that price is an essential ingredient of every contract for the rendering of services, the agreement must be definite as to compensation.").
However, in assessing whether Madison transacted business in New York, the Court is not required to restrict its focus to the alleged contractual arrangement between Madison and Barness. Rather, it is appropriate to examine all of the surrounding events to determine whether Madison has purposefully availed itself of the privilege of conducting business in this jurisdiction. See, e.g., Gunwyn/Lansburgh, Ltd., 825 F. Supp. at 596 ("Whether or not the contacts are of the appropriate nature must be determined by an analysis of the totality of the circumstances."). Considered against this broader landscape, it is clear that Madison has transacted business here.
On similar facts, Judge Koeltl found that this Court had jurisdiction over a corporate defendant sued by a broker for failure to pay a fee. In First Wall Street, as here, the plaintiff contended that the defendants had agreed to pay it a fee for its assistance in securing financing for a particular real estate project, and the defendants argued that they lacked sufficient purposeful contacts with this District. In support of their argument, the defendants sought to distinguish between their earlier negotiations in New York regarding other projects and those relating to the subject project. Rejecting this attempt to bifurcate the evidence, Judge Koeltl noted that the New York Court of Appeals has held that "proof of one transaction in New York is sufficient to invoke jurisdiction [under § 302(a)(1)] even though the defendant never enter[ed] New York, so long as the defendant's activities [here] were purposeful and there is a substantial relationship between the transactions and the claim asserted." Kreutter v. McFadden Oil Corp., 71 N.Y.2d 460, 527 N.Y.S.2d 195, 198-99, 522 N.E.2d 40 (1988), quoted in PDK Labs, Inc., 103 F.3d at 1109; First Wall Street, 1998 WL 338105, at *4.
Madison suggests, however, that this case is "analogous," (see Def.'s Mem. of Law at 9), to MCANY, Inc. v. Carpionato Corp., No. 89 Civ. 4528, 1989 WL 120191 (S.D.N Y Oct. 3, 1989) (Keenan, J.). There, a New York corporation sought to recover a commission for its role in securing a loan from a Wisconsin insurance company for a construction project in Rhode Island which was being undertaken by a Rhode Island corporation. Relying on two "incidental" meetings in New York, "several telephone calls and letters between Rhode Island and New York," and the defendant's "maintenance of a single booth at a New York hotel convention," the plaintiff argued that this Court had jurisdiction over the defendant pursuant to CPLR § 302(a)(1). Id. at *2. Judge Keenan rejected this contention, however, noting that the plaintiff had not shown that the defendant's incidental activities in New York "significantly advance[d] the making of a corporate contract of importance." Id. (quoting Zetlin/Oxhandler, Inc. v. Ridgely/Philadelphia Ltd. Partnership, No. 85 Civ. 5895 [sic], 1987 WL 18655, at *3 (S.D.N.Y. Oct. 16, 1987) (Keenan, J.), and ECC Corp. v. Slater Elec., Inc., 336 F. Supp. 148, 152 (E.D.N.Y. 1971)). By comparison, in this case, had it not been for the meetings in, and Gleaves' telephone calls to, New York, it is likely that CEIEP never would have had occasion to make an investment in Asche. (See Compl. ¶ 15). Moreover, as Barness correctly observes, Gleaves' brief meeting in New York with Barness furthered the CEIEP/Asche deal because it helped ensure that Barness would not withdraw his support. Finally, the closing that generated Madison's million-dollar fee took place in New York. It follows, therefore, that Gleaves' activities in New York did "significantly advance" a contract of importance to Madison.
The parties evidently agree that CEIEP and Asche only learned of one another in the context of this deal. (See Pl.'s Mem. of Law at 7; see also Gleaves Aff. ¶ 6).
In its motion papers, Madison also cites Premier Lending Serv., Inc. v. J.L.J. Assoc., 924 F. Supp. 13, 17 (S.D.N.Y. 1996), a case in which the principal of a New Jersey shopping center telephoned a New York mortgage broker to seek assistance in securing a mortgage. The principal of the New Jersey borrower also visited the mortgage broker in New York after the brokerage agreement was signed. After conducting an evidentiary hearing, Judge Parker found that the meeting in New York was not held to negotiate the brokerage agreement, but, rather, simply to check on the broker's slow progress in securing financing. Id. at 15. Based upon that finding, Judge Parker concluded that the New York meeting had only "slight relevance for jurisdictional purposes" and that the remaining contacts did not "rise to the level of purposeful availment of New York laws" in a transaction which ultimately led to the New Jersey borrower obtaining a mortgage from a New Jersey bank. Thus, Premier Lending arose under facts which are substantially different than those in this case, in which the financing was provided by a company doing business in New York, following negotiations in New York, pursuant to a closing which occurred in New York.
To be sure, courts often do find that a defendant has not sufficiently projected itself into New York for purposes of CPLR § 302(a)(1) jurisdiction when the "center of gravity" of the transaction lies elsewhere. See, e.g., Fischbach Corp. v. United Power Ass'n, Inc., No. 93 Civ. 5373, 1995 WL 505582 (S.D.N.Y. Aug. 24, 1995) (Wood, J.); National Tel. Directory Consultants, Inc. v. Bellsouth Adver. Publ'g Corp., 25 F. Supp.2d 192, 197 (S.D.N Y 1998) (Parker, J.) ("telephone, fax and mail between an out-of-state defendant and a New York plaintiff will not confer jurisdiction unless the defendant used the communications as a means of 'projecting' themselves into the local commerce"); but cf. Parke-Bernet Galleries, Inc. v. Franklyn, 26 N.Y.2d 13, 308 N.Y.S.2d 337, 256 N.E.2d 506 (1970) (upholding jurisdiction over defendant who had participated in live auction in New York by means of open telephone line); CT Chemical, Inc. v. Horizon Int'l, Inc., 106 F.R.D. 518, 520-21 (S.D.N.Y. 1985) (Sweet, J.) (exercising jurisdiction over a defendant that injected itself into the New York market by negotiating a sales contract by mail and telephone with a New York-based seller).
"Center of gravity" is a term borrowed from choice-of-law jurisprudence. A court following this approach looks to the law of the state which has "the most significant relationship to the transaction and the parties." Zurich Ins. Co. v. Shearson Lehman Hutton, Inc., 84 N.Y.2d 309, 618 N.Y.S.2d 609, 642 N.E.2d 1065 (1994) (quoting Restatement (Second) of Conflict of Laws, § 188(1)).
In this case, even if Madison and its personnel failed to attend the closing of the CEIEP/Asche transaction, (see Gleaves Reply Aff. ¶ 2), it is undisputed that Gleaves telephoned Barness in New York in an effort to locate financial support for Asche. More importantly, the firm that ultimately made the desired capital infusion was a company with offices in New York City, and many of the negotiations with CEIEP regarding its eventual stock purchase took place, either by telephone or in person, in New York. (See, e.g., Quirk Aff. ¶¶ 4-6). The transaction, which generated Madison's $1 million fee, also was closed in New York City. In addition, as Barness notes, prior to the closing, and in an apparent attempt to ensure that it went off without a hitch, Gleaves sent a letter to Barness in New York to confirm his role in putting CEIEP and Asche together, and he also visited Barness here. (Compl. ¶¶ 18-19; Barness Aff. ¶ 9; O'Shea Aff. Ex. C).
In sum, viewing the parties' submissions in the light most favorable to the plaintiff, as the Court must at this juncture, Barness plainly has set forth sufficient facts for a finder of fact to conclude that Madison purposefully availed itself of the privilege of conducting activities in this jurisdiction in connection with the stock purchase transaction. Moreover, the center of gravity of Madison's efforts to secure financing for Asche is plainly New York State. Barness therefore has made the required prima facie showing with regard to Madison's transaction of business in this State, the first of the two conditions that must be met for this Court to assert personal jurisdiction over a non-domiciliary defendant under CPLR § 302(a)(1).
2. Cause of Action "Arising From" Transaction of Business
To bring suit in this District, Barness must also make a prima facie showing that his claims arise out of Madison's transaction of business here. Under New York law, a cause of action arises out of the transaction of business when there is an "articulable nexus" or "substantial relationship" between the plaintiff's claims and the activities that constitute the transaction of business. See, e.g., Kreutter, 71 N.Y.2d at 467 ("substantial relationship"); McGowan v. Smith, 52 N.Y.2d 268, 272, 437 N.Y.S.2d 643, 645, 419 N.E.2d 321 (1981) ("articulable nexus"); Holness v. Maritime Overseas Corp., 251 A.D.2d 220, 224, 676 N.Y.S.2d 540, 544 (1st Dep't 1998) ("articulable nexus"); Chamberlain v. Jiminy Peak, 155 A.D.2d 768, 769, 547 N.Y.S.2d 706, 707 (3d Dep't 1989) ("CPLR 302(a)(1) requires an articulable nexus, a substantial relationship, between the New York activity, business or transaction and the asserted claim and injury."); see also Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 60 (2d Cir. 1985) (finding that cause of action arises out of transaction of business when there is a "substantial nexus" between the two).
The requirement that the cause of action be one "arising from" the transaction of business in New York State does not mean that there must be a complete identity between the subject matter of the suit and the acts giving rise to long arm jurisdiction. For example, in Kronisch v. United States, 150 F.3d 112 (2d Cir. 1998), the plaintiff's executrix brought suit in this District against a former overseer of the Central Intelligence Agency's study of the effects of various drugs on human behavior, seeking to recover damages for the CIA's surreptitious administration of LSD to the plaintiff in France some thirty years earlier. The CIA official had made approximately six trips to New York in or around 1952 to retain a consultant for the LSD research program, to confer with an expert, and, ironically, possibly even to administer LSD to himself and others at a New York hotel. Noting that the drugging of the plaintiff in Paris apparently resulted from the activities of a consultant originally retained by the overseer in New York, the Second Circuit held it was "sufficiently related to [the defendant's] work in New York to satisfy plaintiff's prima facie showing of long-arm jurisdiction over [the defendant] under [CPLR] § 302(a)(1)." Id. at 131.
In this case, there is a substantially stronger nexus between the defendant's transaction of business in New York in connection with the Asche financing agreement and the alleged agreement between Madison and Barness which gives rise to Barness's claim. Indeed, as noted earlier, had it not been for CEIEP's decision to purchase 2.3 million shares of Asche stock in New York, there would have been no basis for Barness to recover a finder's fee. Similarly, had Madison not reached out to Barness to seek the names of additional potential investors, the CEIEP/Asche deal would likely never have occurred. There consequently is an articulable nexus between Madison's New York activities and Barness's cause of action sufficient to permit Barness to proceed in this forum.
IV. Conclusion
For the foregoing reasons, Defendant Madison's motion to dismiss for lack of personal jurisdiction should be denied.
IV. Notice of Procedure for Filing of Objections
The parties shall have ten days from the service of this Report and Recommendation to file written objections pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a) and (e). Any such objections shall be filed with the Clerk of the Court, with courtesy copies delivered to the chambers of the Honorable Deborah A. Batts and the undersigned, at the United States Courthouse, 500 Pearl Street, New York, New York 10007, and to any opposing parties. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(e), 72(b). Any requests for an extension of time for filing objections must be directed to Judge Batts. The failure to file timely objections will result in a waiver of those objections for purposes of appeal. See Thomas v. Arn, 474 U.S. 140, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985); Fed.R.Civ.P. 6(a), 6(e), 72(b).