District Court Finds Personal Jurisdiction Over Netherlands Corporation In Futures Market Manipulation Suit

The World in U.S. Courts: Winter 2014 - Personal Jurisdiction
December.20.2013

In re Term Commodities Cotton Futures Lit., U.S. District Court, Southern District of New York, December 20, 2013

This proposed class action lawsuit was brought by speculators who lost money in the cotton futures market in 2011. They allege that the injury was caused by defendant Louis Dreyfus Commodities B.V.’s, which allegedly manipulated the price of cotton futures by "unreasonably and uneconomically" demanding delivery of physical cotton.

Dreyfus is a Netherlands corporation, and it moved to dismiss the complaint for lack of personal jurisdiction. The court found that Dreyfus operates through subsidiaries in the United States, and that it "originates approximately 20% of United States cotton production." Given the substantial volume of U.S. commerce handled by Dreyfus, the court found that Dreyfus could reasonably foresee being held responsible for claimed violations of law in U.S. courts. The court further found that it was reasonable to exercise jurisdiction because Dreyfus was a large multinational corporation doing business on an international scale and could bear the burden of facing suit in the U.S.

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