Newly Limited General Personal Jurisdiction Standard Leads to Dismissal for Austrian Banks in Land Purchase Dispute

The World in U.S. Courts: Spring 2014 - Personal Jurisdiction

St. Michael Enterprises v. Serbia Ministry of Privatization, U.S. District Court, Eastern District of New York, February 25, 2014

In a dispute over the purchase of Serbian property from the Serbian government, Plaintiff St. Michael Enterprises claimed that the Serbian Ministry of Privatization and several Austrian companies committed fraud and breach of contract by interfering with Plaintiff’s agreement to purchase the property. Defendant Austrian banks moved to dismiss the claims for lack of personal jurisdiction. St. Michael claimed general personal jurisdiction over the banks, stemming from the sustained conduct of their subsidiary and affiliated U.S. banks doing business in New York. Specifically, St. Michael alleged that the subsidiary and affiliated U.S. banks executed transactions totaling billions of dollars and "regularly litigated in the New York courts." However, given the U.S. Supreme Court’s limitation of general personal jurisdiction in Daimler AG v. Bauman, the U.S. District Court in Brooklyn, New York, rejected jurisdiction over the banks because neither their place of incorporation nor principal place of business are located in the U.S. Even if all conduct of the subsidiary and affiliated banks were attributed to the banks, the court held the banks still could not be considered "at home" in New York. No basis for specific personal jurisdiction was alleged.

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