Opinion
No. 03 Civ. 2936 (MBM).
November 29, 2004
HARRY H. WISE, III, ESQ., New York, NY, Attorney for Plaintiff.
RICHARD A. CIRILLO, ESQ., KAREN R. KOWALSKI, ESQ., King Spaulding LLP, New York, NY, Attorneys for Defendant Kuwait Finance House.
OPINION AND ORDER
This action arises from the failure of defendant Manakh al Khaleej General Trading and Contracting Co. ("Manakh") to pay for $2.5 million worth of software that plaintiff Neewra, Inc. ("Neewra") sent to Manakh in Kuwait. In an opinion and order dated July 12, 2004, ("the Opinion") I dismissed for lack of personal jurisdiction Neewra's claims against defendant Kuwait Finance House ("KFH"), the bank that was responsible for collecting the $2.5 million payment from Manakh in Kuwait. See Neewra, Inc. v. Manakh Al Khaleej Gen. Trading and Contracting Co., 03 Civ. 2936 (MBM), 2004 WL 1620874 (S.D.N.Y. Jul. 20, 2004). Neewra now moves pursuant to Local Rule 6.3 for reconsideration of that decision, and asks also that it be allowed to conduct jurisdictional discovery and serve an amended complaint. In the alternative, Neewra requests entry of judgment as to its claims against KFH pursuant to Fed.R.Civ.P. 54(b). For the reasons stated below, all of Neewra's motions are denied. Further, in view of statements in its current submissions, Neewra must supplement its papers to explain why its claims against defendants Manakh and Emirates Airlines should not be dismissed.
Despite Neewra's insistence on using the docket number 03 Civ. 3936 (MBK) in its papers, the correct docket number for this case is 03 Civ. 2936 (MBM).
I.
The facts relevant to this motion are stated fully in the Opinion, familiarity with which is assumed, and are restated or augmented here only to the extent necessary.Neewra, a New York-based corporation, agreed to supply Manakh, a Kuwaiti company, with 1,000 units of software in exchange for $2.5 million. (Affidavit of Arween Sahni ("Sahni Aff.") ¶¶ 1-3) Before Manakh agreed to the purchase, Neewra sent a sample unit of software from New York to Manakh in Kuwait in exchange for a $2,500 payment. (Id. ¶ 4) Neewra enlisted ABN Amro, a New York bank, to arrange two international collections — one of the $2,500 sample payment and one of the $2.5 million payment — by KFH, Manakh's bank in Kuwait. (Id. ¶¶ 5, 7; id., Exs. A, B) For each collection, ABN Amro delivered the shipping documents for the relevant shipment to KFH in Kuwait, and KFH was responsible for releasing the shipping documents to Manakh only if Manakh made the required payment. (Declaration of Harry H. Wise III ("Wise Decl."), Exs. C, F) The $2,500 payment for the sample went as planned, and KFH sent the payment to ABN Amro through its own correspondent bank account in New York. (Id., Exs. A, C, D, E; Sahni Aff. ¶ 9) However, KFH allegedly released the second set of shipping documents to Manakh without requiring Manakh to make a $2.5 million payment, and Manakh was therefore able to obtain the valuable software shipment without paying Neewra anything. (Sahni Aff. ¶¶ 9-10; Compl. ¶ 14) In 2003, a man named Sabrawal Chandra Kumar was convicted in Kuwaiti criminal court of assorted crimes as a result of his participation in this incident, and the Kuwaiti court suggested that an unknown KFH employee had helped Kumar obtain the shipment documents without making payment. (See Notice of Motion for Reconsideration or Reargument ("Notice of Mot."), Ex. B).
KFH's contacts with New York are limited. It is not incorporated or licensed to do business in New York, it has not qualified itself with the New York Secretary of State to do business in New York, it has no office or employees in New York, it does not advertise or maintain telephone listings in New York, and it does not own property in New York. (Declaration of Anwar Al-Fuzaie ("Al-Fuzaie Decl.") ¶ 3) KFH does maintain a correspondent account with Citibank, N.A., in New York, which it used to send the $2,500 payment to ABN Amro. (See Wise Decl., Exs. A, D, E) KFH's website also states that KFH has investments in the United States and refers to KFH's successful investments in "the American market." (Id., Ex. B, at 2).
After KFH filed a Rule 12(b)(2) motion to dismiss Neewra's claims against it, the court issued the Opinion, which concluded that Neewra had not made out a prima facie case of jurisdiction under either prong of N.Y.C.P.L.R. § 302(a)(1) or under § 302(a)(3). The court then denied Neewra's request for discovery on the extent to which KFH was doing business in New York within the meaning of N.Y.C.P.L.R. § 301 and granted KFH's motion to dismiss for lack of personal jurisdiction.
II.
Neewra brings this motion for reconsideration pursuant to Local Rule 6.3, which provides in relevant part: "There shall be served with the notice of motion a memorandum setting forth concisely the matters or controlling decisions which counsel believes the court has overlooked." Accordingly, to be entitled to reargument under Local Rule 6.3, "a party must demonstrate that the Court overlooked controlling decisions or factual matters that were put before it on the underlying motion." Eisemann v. Greene, 204 F.3d 393, 395 n. 2 (2d Cir. 2000) (internal quotation marks omitted).
Local Rule 6.3 is narrowly construed and strictly applied to avoid repetitive arguments on issues that have already been considered fully. See, e.g., Dietrich v. Bauer, 198 F.R.D. 397, 399 (S.D.N.Y. 2001). In deciding a Local Rule 6.3 motion, the court must not allow a party to use the motion as a substitute for appealing from a final judgment. See Parrish v. Sollecito, 253 F. Supp. 2d 713, 715 (S.D.N.Y. 2003);Shamis v. Ambassador Factors Corp., 187 F.R.D. 148, 151 (S.D.N.Y. 1999). A party may not advance new facts, issues, or arguments that were not previously presented to the court. See Primavera Familienstifung v. Askin, 137 F. Supp. 2d 438, 442 (S.D.N.Y. 2001); Morse/Diesel, Inc. v. Fidelity and Deposit Co. of Md., 768 F. Supp. 115, 116 (S.D.N.Y. 1991).
Neewra has advanced a plethora of arguments in favor of reconsideration here. Some of these are not properly part of a Local Rule 6.3 motion. Thus, the court will not weigh Neewra's arguments for reconsideration that are based on the recently-obtained judgment of the Kuwaiti criminal court because that judgment was not previously before the court. In addition, Neewra makes several new arguments in support of its assorted positions, but these arguments also will not be considered because they were not previously advanced. Finally, to the extent that Neewra has repackaged old arguments in new trappings without identifying overlooked decisions or facts which support them, the court has considered these arguments fully in the Opinion and will not address them again.
III.
Neewra argues first that this court should reconsider its conclusion that KFH is not subject to jurisdiction in New York under the first prong of N.Y.C.P.L.R. § 302(a), which allows New York courts to exercise jurisdiction over a non-domiciliary who transacts business within the state. According to Neewra, this court overlooked both an allegedly controlling decision by the New York Court of Appeals, Indosuez International Finance, B.V. v. National Reserve Bank, 98 N.Y.2d 238, 746 N.Y.S.2d 631 (2002), and relevant facts in reaching its decision. Because neither Indosuez nor the facts Neewra identifies would affect the determinations reached in the Opinion, the court will not reconsider its conclusion that Neewra did not transact business in New York within the meaning of N.Y.C.P.L.R. § 302(a)(1).
A. Indosuez is Inapposite
Neewra asks the court to reconsider the Opinion in light ofIndosuez for two reasons. First, Neewra believes thatIndosuez supports the conclusion that KFH's potential but unrealized use of its New York bank account to transfer the $2.5 million payment is sufficient, without more, to constitute the transaction of business in New York within the meaning of N.Y.C.P.L.R. § 302(a)(1). (Plaintiff's Memorandum of Law in Support of a Motion for Reconsideration and Reargument ("Pl. Memo.") at 5-6) Second, Neewra claims that Indosuez suggests that the use of KFH's New York bank account for the $2,500 collection provides sufficient justification for the exercise of jurisdiction over KFH with respect to the $2.5 million collection. (Id. at 7) Because Indosuez is inapposite for a cornucopia of reasons, the most relevant of which are described below, the court did not cite Indosuez in the Opinion and that case does not necessitate a change in the Opinion.
Neewra argues that Indosuez supports the conclusion that KFH transacted business in New York under N.Y.C.P.L.R. § 302(a)(1) by virtue of the fact that KFH would have used its New York bank account to facilitate the $2.5 million collection if the collection had been completed. However, to the extent thatIndosuez discusses the jurisdictional relevance of a New York bank account maintained by a defendant, that discussion appears in the Court of Appeals' analysis of the constitutionality of exercising personal jurisdiction as a matter of due process, not in an analysis of N.Y.C.P.L.R. § 302(a)(1). See 98 N.Y.2d at 246-47, 746 N.Y.S.2d at 636. Furthermore, the principal basis that supported the Indosuez Court's finding of jurisdiction was entirely prosaic and not present here: consent. For these reasons, among others, Indosuez had no bearing on the Opinion's analysis of N.Y.C.P.L.R. § 302(a)(1) and thus was not cited.
In Indosuez, the Court of Appeals affirmed the exercise of jurisdiction over the defendant, a Russian bank ("NRB") that had agreed to 14 nondeliverable forward currency transactions with plaintiff Indosuez International Finance B.V. ("Indosuez"), a Netherlands corporation, and then refused to send required payments to Indosuez's New York bank account. 98 N.Y.2d at 242-43, 746 N.Y.S.2d at 633-34. After noting that NRB disputed personal jurisdiction, the Court made the following statement:
NRB, however, maintained a New York bank account for payment of the option payments and the nonoption payments (see CPLR 302[a][1]).98 N.Y.2d at 246, 746 N.Y.S.2d at 636. Without explaining the significance of this statement, or its reference to N.Y.C.P.L.R. § 302(a)(1), the Court then observed that "NRB also has the requisite minimum contacts with New York to support the constitutional exercise of jurisdiction" and proceeded to explain in detail why NRB's contacts with New York were sufficient to satisfy the requirements of due process. Id. At the conclusion of this discussion, the Court then stated, "Not only is NRB subject to this state's jurisdiction because it has the requisite minimum contacts to support jurisdiction, it is also subject to jurisdiction based on the language in the confirmations," which the Court interpreted as making an express New York forum selection. 98 N.Y.2d at 247, 746 N.Y.S.2d at 636.
It is plain that this discussion relates to due process requirements, rather than the transaction of business under N.Y.C.P.L.R. § 302(a)(1), because the three cases the Court cites in this discussion all analyze the constitutionality of an exercise of personal jurisdiction. See Indosuez, 98 N.Y.2d at 246-47, 746 N.Y.S.2d at 636 (citing LaMarca v. Pak-Mor Mfg. Co., 95 N.Y.2d 210, 216, 713 N.Y.S.2d 304, 308 (2000); Banco Ambrosiano v. Artoc Bank Trust, 62 N.Y.2d 65, 71-73, 476 N.Y.S.2d 64, 66-68 (1984); and Parex Bank v. Russian Savs. Bank, 116 F. Supp. 2d 415, 422 (S.D.N.Y. 2000)).
Although Neewra asks this court to find that the jurisdictional holding in Indosuez has some relevance to the question of whether KFH transacted business within the meaning of N.Y.C.P.L.R. § 302(a)(1), Indosuez supports no such conclusion. In Indosuez, the Court of Appeals affirmed the exercise of jurisdiction on two bases: (1) NRB's contacts with New York, which primarily involved the actual and contemplated use of New York correspondent bank accounts in the transactions, were sufficient to support the exercise of jurisdiction under the due process clause; and (2) NRB had expressly submitted to New York jurisdiction because of forum selection clauses in its confirmations. See 98 N.Y.2d at 246-48, 746 N.Y.S.2d at 636-37.Indosuez's brief, unexplained reference to N.Y.C.P.L.R. § 302(a)(1) cannot fairly be read to constitute a holding that NRB transacted business in New York by maintaining a New York bank account. Indeed, when it described its first jurisdictional holding, the Court explained that it had found NRB to have "the requisite minimum contacts to support jurisdiction" — the relevant due process inquiry — but did not state also that the cause of action arose from NRB's transaction of business in New York, which is the relevant inquiry under the first prong of N.Y.C.P.L.R. § 302(a)(1). 98 N.Y.2d at 247, 746 N.Y.S.2d at 636. Because the Indosuez Court thus never stated or held that NRB's contacts with New York were sufficient to constitute the transaction of business in New York for the purposes of N.Y. C.P.L.R. § 302(a)(1), Indosuez contains no overlooked law on the question of whether KFH transacted business in New York within the meaning of N.Y.C.P.L.R. § 302(a)(1), and I decline to alter the result in the Opinion on that basis.
Neewra's other argument based on Indosuez — that it "shows that the sample transaction can support jurisdiction over the related sale contract" (Pl. Memo. at 7) — also lacks merit. Neewra does not explain how Indosuez supports this conclusion, apart from stating — without including a page citation — that "the Court of Appeals made it clear that it would look at prior transactions involving the same parties to support jurisdiction over a later, related one." (Id.) To the extent Neewra is relying on the Indosuez Court's suggestion that a "course of dealing" between parties has some jurisdictional relevance, see 98 N.Y.2d at 247, 746 N.Y.S.2d at 636, Neewra's reliance is misplaced because there was no course of dealing in this case — KFH completed only one collection for Neewra and Manakh, which is not sufficient to establish a course of dealing. Neewra also may be alluding to the Court's conclusion that the 14 nondeliverable forward currency exchange transactions between the two parties were part of one global agreement, but that conclusion was entirely unremarkable in that case because each transaction was evidenced by a confirmation that provided that it was part of a global agreement. See 98 N.Y.2d at 242, 247, 746 N.Y.S.2d at 633, 636-37. Neewra alleges no such agreement here, and apart from making the two oblique statements cited above, it does not explain how Indosuez has any relevance to this court's conclusion that the failed $2.5 million collection was a separate transaction from the $2,500 collection for the purposes of jurisdiction. Accordingly, there is no reason to change the Opinion on this basis.
B. No Facts Support Finding One Transaction
Neewra argues also that this court overlooked relevant facts when it concluded that KFH's successful collection of $2,500 and its failed collection of $2.5 million were separate transactions for the purposes of N.Y.C.P.L.R. § 302(a)(1). (Pl. Memo. at 7-9) Specifically, Neewra claims that the court's decision should be reconsidered because it overlooked (1) the Kuwaiti court judgment, and (2) Manakh and Neewra's belief that the two collections were one transaction. As discussed in Part II,supra, the Kuwaiti court judgment will not be considered for the purposes of Neewra's Local Rule 6.3 motion. As for Neewra and Manakh's perception of the two collections as one transaction, which Neewra describes as the "objective reality" (see id. at 8), this perception cannot control when the only facts alleged in the record show that ABN Amro made separate requests to KFH to perform each collection, neither of which mentioned the other. (See Wise Decl., Exs. C, F) The true "objective reality" here is that KFH entered into two separate agreements to perform two different banking services that had no apparent connection. That these two collections were requested in furtherance of a single business transaction between other parties, both of whom viewed the two collections as one transaction, does not mean that KFH engaged in a single transaction of business when it attempted to perform the two collections.
Neewra claims that, in light of its belief that the two collections were one transaction, the court should not have concluded that the two collections were separate transactions based on the facts described above, without more. (Pl. Memo. at 8) However, Neewra actually bore the burden of making a prima facie showing of jurisdiction by pleading legally sufficient allegations of jurisdiction. See Whitaker v. Am. Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2001). Neewra and Manakh's alleged belief that the two collections were one transaction does not make them so and does not constitute a legally sufficient allegation of jurisdiction. Because Neewra identifies no other overlooked facts which support the exercise of jurisdiction under the first prong of N.Y.C.P.L.R. § 302(a)(1), the court will not change that part of the Opinion.
Neewra asks in the alternative that it be permitted to conduct jurisdictional discovery on the question of whether KFH knew that the two collections were connected to the same business transaction. (Pl. Memo. at 9) However, Neewra has alleged no facts which suggest such a connection. Instead, Neewra's counsel suggests only that the Kuwait criminal court judgment shows that "at least one employee of KFH likely knew very well that the two collections were related, because he was conspiring with Manakh to defraud Neewra." (Id. at 8) Despite the cloud of modifiers in which counsel envelops the Kuwaiti court finding, all that appears from this finding is what appeared in Neewra's initial papers: although it is theoretically possible that someone at the bank knew these collections were connected, Neewra has alleged no facts to support such a connection, or, in Neewra's parlance, absolutely no facts at all, whatsoever. Accordingly, because Neewra's allegations do not establish a prima facie case of jurisdiction under the first prong of N.Y.C.P.L.R. § 302(a)(1), Neewra's request for further discovery about a possible connection between the two collections is denied. See Jazini v. Nissan Motor Co., Ltd., 148 F.3d 181, 186 (2d Cir. 1998).
IV.
Neewra also asks this court to reconsider its conclusion that KFH is not subject to jurisdiction in New York under the second prong of N.Y.C.P.L.R. § 302(a)(1), which allows a court to exercise jurisdiction over a non-domiciliary who "contracts anywhere to supply goods or services in the state." N.Y.C.P.L.R. § 302(a)(1). Neewra claims that, in reaching this holding, the court overlooked Banco Ambrosiano, S.P.A. v.Artoc Bank Trust Ltd., 62 N.Y.2d 65, 476 N.Y.S.2d 64 (1984), in which the New York Court of Appeals concluded that defendant Artoc had entered into "a contract made or to be performed within this state" within the meaning of § 200-b of the Banking Law when it received three loans at its New York bank account and promised to repay them to Banco Ambrosiano's New York bank account. 62 N.Y.2d at 74, 476 N.Y.S.2d at 68. The court did not cite Banco Ambrosiano in its Opinion for good reason. First, the plaintiff in Banco Ambrosiano conceded the lack of in personam jurisdiction, and accordingly the Banco Ambrosiano Court analyzed only propriety of exercising quasi-in-rem jurisdiction, not the applicability of N.Y.C.P.L.R. § 302(a)(1). 62 N.Y.2d at 70, 476 N.Y.S.2d at 66. Because Banco Ambrosiano thus did not address the question of whether Artoc's activities in New York constituted a contract for goods or services under N.Y.C.P.L.R. § 302(a)(1), that decision is not controlling here. Second, theBanco Ambrosiano Court concluded only that Artoc had entered into "a contract made or to be performed within this state"; it did not conclude that Artoc's agreement to repay the loan constituted a contract to supply goods or services, which is the relevant inquiry under N.Y.C.P.L.R. § 302(a)(1). Because Banco Ambrosiano thus has no bearing on the question of whether KFH contracted to supply goods or services in New York under N.Y.C.P.L.R. § 302(a)(1), it provides no basis to change the Opinion.
In its original brief, Neewra cited cases which held that a financial guaranty payable in New York was a contract for services under the second prong of N.Y.C.P.L.R. § 302(a)(1), and it asked this court to apply the reasoning of these cases to KFH's role in the collection, which it claimed was "no different from a guaranty situation." (Plaintiff's Memorandum of Law in Opposition to the Motion to Dismiss ("Pl. Memo. in Oppos. to Mot.") at 10) The court discussed and rejected this argument,see Neewra, 2004 WL 1620874, at *5-*6, and Neewra now attempts to clarify its earlier argument because it believes that it "did not succeed in conveying to the Court what its argument is on this point." (Pl. Memo. at 9) Although Neewra has rephrased its contentions, its basic argument is the same one which was already rejected in the Opinion. For the reasons discussed in Part II, supra, this repetitive argument should not and will not be reconsidered on Neewra's Local Rule 6.3 motion.
V.
Neewra next asks the court to reconsider its refusal to allow discovery on the question of whether KFH was doing business in New York within the meaning of N.Y.C.P.L.R. § 301. Several of the arguments that Neewra now advances in its Local Rule 6.3 motion have not previously been raised. Most notably, Neewra argues for the first time that Al-Fuzaie's declaration should have been disregarded as unreliable because several statements in the declaration allegedly conflict with facts in the record. (Pl. Memo. at 12-14) Neewra also implies, without actually so alleging, that KFH may have been doing business in New York if it maintained an affiliated entity in New York or if its New York bank account was significant to its business. (Id. at 14) Because none of these arguments were previously raised, they will not be considered now, on Neewra's Local Rule 6.3 motion.Neewra suggests also that the court overlooked relevant law in denying Neewra's request for jurisdictional discovery. However, Neewra's contention that jurisdictional discovery "should be allowed where the request is not clearly frivolous" is not consistent with the law of this circuit. (Id. at 10) In this circuit, if a plaintiff does not allege specific facts that sufficiently establish a prima facie case of jurisdiction, that plaintiff is not entitled to discovery on that issue. See Jazini, 148 F.3d at 185-86 (2d Cir. 1998). Although Neewra has speculated, on the basis of the vague statements on KFH's website, that discovery might reveal some now unidentified facts which would establish that KFH is doing business in New York, it has not alleged any facts that establish a prima facie case of jurisdiction under N.Y.C.P.L.R. § 301. (See Pl. Memo. in Oppos. to Mot. at 13; Pl. Memo. at 10-15) Because Neewra has failed to establish a prima facie case of jurisdiction over KFH under N.Y.C.P.L.R. § 301, the court will not reconsider its decision to deny Neewra jurisdictional discovery. See Janzini, 148 F.3d at 186 ("Since the Jazinis did not establish a prima facie case that the district court had jurisdiction over Nissan Japan, the district court did not err in denying discovery on that issue.").
VI.
In addition to its reconsideration requests, Neewra asks that it be given leave to serve an amended complaint that presents a new claim against KFH: conspiracy to defraud. Neewra argues that the court would have jurisdiction over this new claim because the acts of Manakh may be attributed to its alleged coconspirator, KFH, for the purpose of obtaining personal jurisdiction over KFH. (Pl. Memo. at 15) According to Neewra, KFH could thus be subject to jurisdiction in New York under N.Y.C.P.L.R. § 302(a)(3) because its co-conspirator Manakh caused injury in New York when Neewra sent the software shipment from New York to Kuwait in reliance on Manakh's fraudulent misrepresentations. (Id. at 15-16)
Even assuming arguendo that Neewra could otherwise state a claim against KFH for conspiracy to commit fraud and that such a claim could support the exercise of jurisdiction, this proposed claim would still ultimately fail because the facts Neewra has alleged reveal that KFH was the intended victim of a conspiracy to defraud, not a co-conspirator. Although, as Neewra points out, the Kuwaiti criminal court judgment suggests that an unidentified errant KFH employee may have been involved in the conspiracy, the same judgment also referred to "a criminal agreement for the purpose of binding Kuwait Financial House to pay [$2.5 million] in consideration of losing the collection documents" and stated that Kumar had "falsified the documents he has pertinent to the company in order to seize the money of Kuwait Financial House." (Notice of Mot., Ex. B, at 6, 8) Because the Kuwaiti court judgment, which Neewra presents as the basis for its request to amend, shows that the goal of the conspiracy was to defraud KFH, KFH could not possibly have been a co-conspirator in the plot to defraud itself, and thus "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief."Ricciuti v. N.Y.C. Transit Authority, 941 F.2d 119, 123 (2d Cir. 1991) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). Indeed, as might be expected, Neewra has identified no facts which would or could be alleged to support the inference that KFH is a co-conspirator, rather than a targeted victim of the conspiracy. Because Neewra's proposed claim based on conspiracy to defraud could not withstand a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the amendment would be futile and Neewra's request for leave to amend therefore is denied. See Oneida Indian Nation of N.Y. v. City of Sherill, N.Y., 337 F.3d 139, 168 (2d Cir. 2003).
Not surprisingly, however, Neewra implicitly disavows the Kuwaiti court judgment when it undermines Neewra's argument. Thus, Neewra dismisses as "dubious" and "unsupported" KFH's claim that it was the intended victim of the conspiracy, although the Kuwaiti court judgment makes multiple references to a scheme to defraud KFH. (Plaintiff's Reply Mem. of Law in Support of motion for Reconsideration and Reargument, at 4).
VII.
Finally, Neewra asks in the alternative that the court enter final judgment against it pursuant to Fed.R.Civ.P. 54(b) to enable Neewra to appeal. (Pl. Memo. at 16-17) According to Neewra, "[a]pplication of this rule is particularly apt in this case" because "[i]t makes little sense to continue the action against the one remaining defendant, Emirates Airlines, which is alleged only to have been tricked by the criminality of Manakh and employees of KFH, with KFH now out of the case on jurisdictional grounds." (Id.) Two things are remarkable about Neewra's statement: (1) it presumes that Manakh is no longer a defendant in this action, and (2) it concedes that Neewra's claims against Emirates Airlines has no merit. Based on these two concessions, the court will consider dismissing Neewra's claims against Manakh and Emirates Airlines, but not before giving Neewra notice and an opportunity to brief these questions.
The first issue to address is Neewra's assumption that Manakh, a named defendant in this action, is no longer a party in the case. Although Neewra claimed in its initial papers that Manakh had "defaulted" (see Pl. Memo. in Oppos. to Mot. at 1), there is nothing in the court docket to show that Neewra ever sought a default judgment. Indeed, although Neewra mailed a summons and complaint to Manakh in Kuwait, nothing in the docket indicates that Neewra has succeeded in effecting service. Accordingly, Neewra must show the court either that it has effected service on Manakh or that its time to effect service should be extended for good cause, and if Neewra fails to make either showing, its claims against Manakh will be dismissed without prejudice. See Fed.R.Civ.P. 4(m).
The more startling issue is Neewra's concession that it cannot prevail on its claims against defendant Emirates Airlines. Based on this judicial admission, it appears that Emirates Airlines may be entitled to summary judgment as to all claims against it. This court has the power to enter summary judgment sua sponte, but only if Neewra is on notice that it must come forward with all of the evidence in support of its claims against Emirates Airlines.Pugh v. Good, 345 F.3d 121, 124 (2d Cir. 2003). The Second Circuit has explained:
Before granting summary judgment sua sponte, the district court must assure itself that following the procedures set out in Rule 56 would not alter the outcome. Discovery must either have been completed, or it must be clear that further discovery would be of no benefit. The record must, therefore, reflect the losing party's inability to enhance the evidence supporting its position and the winning party's entitlement to judgment.First Fin. Ins. Co. v. Allstate Interior Demolition Corp., 193 F.3d 109, 115 (2d Cir. 1999) (quoting Ramsey v. Coughlin, 94 F.3d 71, 74 (2d Cir. 1996)). In light of Neewra's admission that any pursuit of claims against Emirates Airlines would be fruitless, it appears likely that further discovery would be of no benefit. However, the court will not enter summary judgmentsua sponte without providing Neewra notice and an opportunity to come forward with evidence showing that there is a genuine material issue for trial with respect to its claims against Emirates Airlines or that further discovery would be of some benefit. Accordingly, Neewra should present to the court evidence showing why the court should not enter summary judgment sua sponte in favor of Emirates Airlines as to all claims.
The final question is whether to grant Neewra's request for the entry of judgment pursuant to Fed.R.Civ.P. 54(b). Because a district court should exercise sparingly its power to enter a final judgment before the entire case is concluded, "[t]he power which this Rule confers upon the trial judge should be used only in the infrequent harsh case." O'Bert ex rel. Estate of O'Bert v. Vargo, 331 F.3d 29, 41 (2d Cir. 2003) (quoting Cullen v.Margiotta, 618 F.2d 226, 228 (1980) (per curiam)). In other words, "certification should be granted only if there exists some danger of hardship or injustice through delay which would be alleviated by immediate appeal." Id. (internal quotation marks omitted). Because Neewra has identified no hardship or injustice that would result from its inability to appeal immediately the court's jurisdictional decisions, its request for entry of judgment pursuant to Rule 54(b) is denied.
* * *
For the reasons stated above, the court denies Neewra's Local Rule 6.3 motion, request for jurisdictional discovery, request for leave to amend its complaint is denied, and request for the entry of judgment pursuant to Fed.R.Civ.P. 54(b). Neewra is directed to supplement its papers by December 15, 2004, to address the issues relating to Manakh and Emirates Airlines that are discussed in Part VII, supra.SO ORDERED.