Opinion
01 Civ. 1305 (SAS)
November 13, 2001
AMENDED OPINION AND ORDER
Ghulam Khan, appearing pro Se, brings this action against the State Bank of India, New York ("NY Branch"), the State Bank of India, Central Office ("Mumbai Branch"), and the State Bank of India, Kanpur ("Kanpur Branch"), seeking wages and reimbursements arising from his employment with various offices of the State Bank of India both in New York and in India ("Bank"). Khan also demands punitive damages for the allegedly illegal treatment of him in conjunction with a threatened foreclosure on his house in India. The N.Y. Branch now moves to dismiss Khan's Amended Complaint ("Complaint") pursuant to Federal Rule of Civil Procedure 12(b)(5) for insufficient service of process, and pursuant to Rule 12(b)(6) for failure to state a claim on which relief can be granted, and on the ground that Khan's claims are time-barred. In the alternative, the N.Y. Branch moves to strike Khan's demand for a jury trial pursuant to Rule 12(f). For the reasons stated below, the N.Y. Branch's motion to dismiss is granted and the case is closed as to all defendants.
The N.Y. Branch asserts that the Mumbai Branch and the Kanpur Branch have not been served and are therefore not defendants. See N.Y. Branch's Motion to Dismiss and Motion to Strike at 1 n. 1. However, Khan did serve both the Mumbai Branch and the Kanpur Branch via personal service on an employee of the N.Y. Branch on Park Avenue. See 6/21/01 "Summons in a Civil Case" Served on State Bank of India, Central Office, Mumbai; 6/21/01 "Summons in a Civil Case" Served on State Bank of India, Kanpur. Because this case is dismissed for lack of jurisdiction, and alternatively as time-barred and failing to state a claim, there is no need to resolve the issue of insufficient service of process.
I. FACTUAL BACKGROUND
From 1964 until May 1983, Khan held the position of Staff Officer at various branches of the Bank. See Amended Complaint ("Am. Compl.") ¶ 3. In May 1980, Khan was transferred to the State Bank of India's New York office, where he worked until his resignation on July 13, 1983. See id. 1/12/98 Letter from Khan to M.S. Verma, Chairman of the State Bank of India ("Int'l Registered A/D"), Ex. 2 to Am. Compl. Khan commenced this action on February 21, 2001, claiming that the defendants owe him "service dues" in the amount of $573,956. Am. Compl. ¶ 2. This figure represents unpaid wages, reimbursement expenses, travel expenses for himself and his family, and tuition expenses for one of his children.See 6/15/95 Signed Statement from Khan ("Itemized A/c of Dues"), Ex. 3 to Am. Compl. All of the "service dues" allegedly accrued between 1973 and 1983. Id. Khan claims the Bank owes him these dues "as per the laws of equity and justice" and also because other bank employees received similar dues upon their resignation. Am. Compl. ¶ 2.
Because the exhibits are not numbered, the Court references them in the order in which they are attached to the Complaint.
Khan further alleges that "defendants are also trying to take over [his] little house." Id. ¶ 14. In 1980, Khan borrowed money from the Kanpur branch through a government company called Lucknow Development Authority to purchase a house in India. See id. ¶ 6. Although the Complaint is not entirely clear, it appears that Khan defaulted on one or more of the repayments. Khan claims that he did not receive any default notices for ten years because both the Kanpur Branch and the N.Y. Branch acted negligently in posting the notices at "imaginary addresses." Summarization ("House Purchase Summary"), Ex. 9 to Am. Compl. Khan claims that these actions demonstrate a "clear attempt of illegal take over of [his] house." Id. The attached documentation reveals that, in 1994, Khan's son learned of the default and settled the debt with the Bank.See 1/18/95 Letter from Kanpur Branch to Khan, Ex. 10 to Am. Compl. Khan seeks one million dollars in punitive damages for the willful failure of both the Kanpur Branch and the N.Y. Branch to provide him with notice of the foreclosure. See Am. Compl. ¶ 14(b); House Purchase Summary.
II. DISCUSSION
1. Legal Standard
A. Subject-Matter Jurisdiction
Where parties bring an action in federal court that does not contain a federal claim, they must satisfy the requirements for jurisdiction based on diversity of citizenship. See U.S. Const. Art. III, § 2; see generally Wright Miller, 13 Federal Practice Procedure: Jurisdiction 2d §§ 3502, 3602 (2001). The plaintiff must demonstrate that subject matter jurisdiction exists by explicitly alleging in the pleadings the citizenship of each party. See Leveraged Leasing Admin. Corp. v. PacifiCorp Capital. Inc., 87 F.3d 44, 47 (2d Cir. 2000); Sky-Lite Co. v. Eminent Sportswear Co., 115 F. Supp.2d 394, 399 (S.D.N Y 2000). Where neither the plaintiff nor the defendant challenges jurisdiction, the Court must raise the issue sua sponte. See Ruhrgas A.G. v. Marathon Oil Co., 526 U.S. 574, 583 (1999) ("Article III generally requires a federal court to satisfy itself of its jurisdiction over the subject matter before it considers the merits of a case."); Franceskin v. Credit Suisse, 214 F.3d 253, 257 (2d Cir. 2000)
Kahn alleges diversity jurisdiction pursuant to 28 U.S.C. § 1332.See Compl. ¶ 1. There is no diversity jurisdiction, as explained below. However, if the State Bank of India is a foreign sovereign under the Foreign Sovereign Immunities Act, 28 U.S.C. § 1330, 1602-1611, there may be subject matter jurisdiction. See Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 489 (1983) (finding that the Foreign Sovereign Immunities Act conferred "arising under" jurisdiction even in case where foreign plaintiff sued foreign sovereign on state law grounds, assuming an exception to immunity was properly pleaded).
2. Analysis
Plaintiff fails to allege that he is a United States citizen, which in turn destroys diversity in this case. Khan does allege that he lives in New York. See Am. Compl. ¶ 9 ("I was transferred here in New York and live here."). However, a statement of residence is insufficient to plead citizenship, see Leveraged Leasing, 87 F.3d at 47, and this Court may not infer citizenship where it is not plead.
Khan's mention of the fact that his sons are U.S. citizens, see Am. Compl. ¶ 8, makes his failure to allege his own citizenship all the more glaring. It is of course possible that Khan is a U.S. citizen. However, it would be futile to grant him leave to amend in light of the alternate grounds for dismissal. See infra Part III.B.
As an alien suing other aliens, Khan's claims cannot be heard in federal court because this Court has no subject matter jurisdiction over the claims. On the basis of a 1988 amendment to section 1332 ("1988 Amendment"), Khan is considered to be a citizen of New York for purposes of diversity jurisdiction. See 28 U.S.C. § 1332(a) ("[A]n alien admitted to the United States for permanent residence shall be deemed a citizen of the State in which such alien is domiciled."). However, this Circuit has created an exception to this general rule, holding that the 1988 Amendment does not apply where an alien plaintiff names one or more alien defendants. See Buti v. Impresa Perosa, 935 F. Supp. 458, 461 (S.D.N.Y. 1996), aff'd, 139 F.3d 98 (2d Cir. 1998) Courts in this Circuit have concluded that Congress did not intend the 1988 amendment to abrogate the well-established principle that aliens cannot sue aliens in federal court. See ITT v. Vencap, 519 F.2d 1001, 1015 (2d Cir. 1975) ("Diversity jurisdiction under 28 U.S.C. § 1332 is defeated by the presence of aliens both as plaintiffs and as defendants."); Lloyds Bank PLC v. Norkin, 817 F. Supp. 414, 415-16 (S.D.N Y 1993) (explaining that the main reason for the 1988 Amendment was to destroy diversity where a permanent resident alien domiciled in a U.S. state sues a citizen of that state). The defendants, including the New York branch, are aliens. See Bailey v. Grand Trunk Lines, 805 F.2d 1097, 1101 (2d Cir. 1986) ("[A]n alien corporation's worldwide principal place of business and not its principal place of business within the United States, is controlling [for jurisdictional purposes]."). Therefore, this Court lacks jurisdiction over the subject matter of this suit and it is hereby dismissed.
The Third Circuit sharply disagrees. See Singh v. Daimler-Benz AG, 9 F.3d 303, 305-307 (3rd Cir. 1993) (examining the legislative history of the 1988 Amendment to conclude that a federal court has subject matter jurisdiction over a suit brought by a permanent resident alien against a nonresident alien).
The result would not change even if the N.Y. Branch were deemed a citizen under 28 U.S.C. § 1332(c). See Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267 (1806) (holding that Article III requires complete diversity, i.e. that each plaintiff be diverse from each defendant);ITT, 519 F.2d at 1015 (holding that complete diversity is lacking where aliens are present on both sides of the equation).
As noted earlier, this Court may have subject matter jurisdiction under the Foreign Sovereign Immunities Act of 1976. See note 3, supra. However, because the case must be dismissed on alternate grounds, it is unnecessary to pursue that possible basis for jurisdiction.
Khan may not attempt to cure the jurisdictional defect because his case must be dismissed on alternative grounds. The relevant statute of limitations bars his claim for service dues, wages and reimbursements, and he fails to state a cause of action with respect to the foreclosure issue.
B. Motion to Dismiss
1. Legal Standard
Dismissal of a complaint for failure to state a claim pursuant to Rule 12(b)(6) is proper only where "'it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief.'" ICOM Holding, Inc. v. MCI Worldcom, Inc., No. 00-7660, 2001 WL 46675, at *1 (2d Cir. Jan. 22, 2001) (quoting Harris v. City of New York, 186 F.3d 243, 247 (2d Cir. 1999)). "At the Rule 12(b)(6) stage, '[t]he issue is not whether a plaintiff is likely to prevail ultimately, but whether the claimant is entitled to offer evidence to support the claims. Indeed it may appear on the face of the pleading that a recovery is very remote and unlikely but that is not the test.'"Sims v. Artuz, 230 F.3d 14, 20 (2d Cir. 2000) (quoting Chance v. Armstrong, 143 F.3d 698, 701 (2d Cir. 1998) (quotation marks omitted)). The task of the court in ruling on a Rule 12(b)(6) motion is "'merely to assess the legal feasibility of the complaint, not to assay the weight of the evidence which might be offered in support thereof.'" Sims, 230 F.3d at 20 (quoting Ryder Energy Distribution Corp. v. Merrill Lynch Commodities Inc., 748 F.2d 774, 779 (2d Cir. 1984) (quotation marks omitted)).
To properly rule on a 12(b)(6) motion, the court must accept as true all material facts alleged in the complaint and draw all reasonable inferences in the nonmoving party's favor. See ICOM Holding, 2001 WL 46675, at *1. Nevertheless, "[t]o survive a motion to dismiss, [plaintiff's] claims must be 'supported by specific and detailed factual allegations' not stated 'in wholly conclusory terms.'" Friedl v. City of New York, 210 F.3d 79, 85-86 (2d Cir. 2000) (quoting Flaherty v. Coughlin, 713 F.2d 10, 13 (2d Cir. 1983)). Because "most pro se plaintiffs lack familiarity with the formalities of pleading requirements, [courts] must construe pro se complaints liberally, applying a more flexible standard to evaluate their sufficiency." Lerman v. Board of Elections in the City of New York, 232 F.3d 135, 140 (2d Cir. 2000) (citing Hughes v. Rowe, 449 U.S. 5, 9-10 (1980) and Haines v. Kerner, 404 U.S. 519, 520-21 (1972)), cert. denied sub nom. New York State Bd. of Elections v. Lerman, 69 U.S.L.W. 3594 (U.S. June 18, 2001) (No. 00-1360). Thus, dismissal is "'appropriate only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'" Friedl, 210 F.3d at 83 (quoting Harris, 186 F.3d at 250 (quotation marks omitted)). "'This rule applies with particular force where the plaintiff alleges civil rights violations or where the complaint is submitted pro se.'" Cruz v. Gomez, 202 F.3d 593, 596 (2d Cir. 2000) (quoting Chance, 143 F.3d at 701). Finally, a federal court in a diversity action must look to the law of the forum state to determine the applicable statute of limitations. See Stuart v. Am. Cyanamid Co., 158 F.3d 622, 626 (2d Cir. 1998).
2. Analysis
i. Claim for Wages, Service Dues and Reimbursements
A plaintiff suing to recover wages, benefits and wage supplements must comply with a six year statute of limitations. See N.Y. Lab. Law § 198(3) (McKinney 2000). Similarly, a claim arising from a breach of contract must be brought within six years. See N.Y. C.P.L.R. § 213(2) McKinney 2000); Swartz v. Berkshire Life Ins. Co., No. 99 Civ. 9462, 2000 WL 1448627, at *3 (S.D.N.Y. Sept. 28, 2000).
Khan filed this action on February 21, 2001. In his Complaint, Khan itemizes the "service dues" he claims the defendants owe. Am. Compl. ¶ 2. These dues represent unpaid wages and reimbursements for expenses. Id. All of Khan's claims arose between 1974 and 1983 and are thus barred by either of the applicable statutes of limitations under the most liberal interpretation of either statute.
Khan does not dispute the time frame in which these claims accrued. He appears to rely on the fact that he has made repeated demands for payment since 1983. See Plaintiff's Reply Brief ("Pl. Repl.") at 3.
ii. Claim for Punitive Damages for Failure to Give Notice
Khan has failed to state a claim on which relief can be granted where he alleges that one or more of the defendants tried to take over his house. Here, Khan's main contention is that both the N.Y. Branch and the Kanpur Branch willfully failed to notify him of foreclosure by posting default notices in locations where it knew he did not reside. See Am. Compl. ¶ 6. Khan does not allege that the N.Y. Branch or any defendant foreclosed on his house, nor does he provide specifics as to how he has been harmed by the alleged failure to give proper notice. The attached documentation reveals that in 1994 Khan's son learned of the default and settled the debt with the Bank. See 1/18/95 Letter from Kanpur Branch to Khan, Ex. 10 to the Am. Compl. A searching review of the facts Khan alleges regarding the defendants' failure to give notice, fails to reveal a theory on which plaintiff seeks punitive damages. These allegations do not state a cause of action that would entitle Khan to any relief.Because the Complaint must be dismissed on other grounds, there is no need to address Khan's demand for a jury trial.
III. CONCLUSION
For the reasons discussed above, Khan's complaint is dismissed and the Clerk of the Court is directed to close this case.