United States District Court, Southern District of New York
April 14, 2003
JOSEPH GIAR, PLAINTIFF,
CENTEA, A DIVISION OF KBC BANK, NV, DEFENDANT
The opinion of the court was delivered by: Louis L. Stanton, United States District Judge
Opinion and Order
This is a pre-answer motion to dismiss the complaint against defendant Centea NV, a savings bank organized under the laws of Belgium, for lack of personal jurisdiction and insufficient service of process. Plaintiff has failed to make even a prima facie showing of personal jurisdiction in his complaint and submissions on this motion. See Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir. 1985) ("In the absence of an evidentiary hearing on the jurisdictional allegations, or a trial on the merits, all pleadings and affidavits are construed in the light most favorable to plaintiff, and where doubts exist, they are resolved in the plaintiff's favor.").
The complaint asserts that Centea is "a division of KBC Bank NV," and thereafter refers to both as one entity, "`Centea/KBC' or `Defendant.'" (Compl. ¶ 3.) KBC Bank NV, Centea's corporate parent, is a Belgium corporation headquartered in Belgium, authorized to do business in New York and maintaining an office in New York, New York.*fn1 The complaint charges that "Centea/KBC" made libelous and slanderous accusatory statements to Belgian criminal justice authorities, which plaintiff asserts led to his false arrest and imprisonment in Athens, Greece. All the events described in the complaint occurred in Europe, and there is no claim that any act or injury occurred in New York.*fn2
Plaintiff does not dispute that Centea itself does no business in the United States and operates only in Belgium (see Van Bree Repl. Decl. ¶ 4). Rather, he contends that his service on KBC Bank in New York confers personal jurisdiction over Centea because of either (1) Centea's activities as an agent for KBC Bank, or (2) the assertion that Centea is a mere department of KBC Bank.*fn3
By itself, "the presence of a local corporation does not create jurisdiction over a related, but independently managed, foreign corporation." Volkswagenwerk Aktiengesellschaft v. Beech Aircraft. Corp., 751 F.2d 117, 121 (2d Cir. 1984).
Nothing in the pleadings or the record on this motion establishes or supports an inference that KBC Bank performed any services or functions, or acted as agent in any capacity, for Centea in New York. Compare Frummer v. Hilton Hotels Int'l, Inc., 19 N.Y.2d 533, 537, remittitur amended, 20 N.Y.2d 737, cert. denied, 88 S.Ct. 241 (1967) (finding jurisdiction over parent corporation because agent "does all the business which [the parent corporation] could do were it here by its own officials"). Nor is there any basis for an inference that Centea was either a general agent or, in taking its alleged actions in Europe was acting as an agent, for KBC Bank in New York.
Nor do the complaint and affidavits support the suggestion that Centea is a mere department of KBC Bank. See Jazini v. Nissan Motor Co., 148 F.3d 181, 185 (2d Cir. 1998) (conclusory statements that subsidiary was mere department of parent insufficient to confer jurisdiction). The facts proffered by plaintiff, e.g., that Centea was 99.6% owned by KBC Bank, that it shared some directors with KBC Bank, that its chairman was forced to retire, and that the reduction in number of Centea agencies accorded with the KBC Bank and Insurance Holding Company NV's policy, do not warrant treating KBC and Centea as a single entity for jurisdictional purposes. These facts show no more than the normal business influence of a corporate parent; they fall far short of the "pervasive control over the subsidiary that the `mere department' standard requires." Jazini, 148 F.3d at 185.
Furthermore, plaintiff does not controvert the evidence that Centea is a public limited company organized and existing under the laws of Belgium (Curran Aff. ¶ 2) and has "its own structure, offices and conducts business with its own personnel, lawyers, etc.," or that "Centea is fully responsible without interference from KBC, for example, for granting loans and other aspects of its business." (Van Bree Decl. ¶¶ 6-10.)
Service of process on KBC Bank, does not constitute effective service on Centea, since KBC Bank is a distinct corporate entity that is not authorized to accept service on behalf of Centea (Van Bree Decl. ¶ 11)*fn4. "It is hornbook law that service of process on a subsidiary does not constitute service on a parent corporation, nor does service on a parent constitute service on a subsidiary. Except in exceptional circumstances not present here, the law respects separate corporate identities even where one corporation may wholly own another, or where they may share the same principals." In re Matter of Crespo, 123 Misc.2d 862, 865 (N.Y. Sup.Ct. 1984).
Having failed to make even a prima facie showing of jurisdiction, plaintiff is not entitled to jurisdictional discovery. See Jazini v. Nissan Motor Co., 148 F.3d 181, 186 (2d Cir. 1998) (since plaintiff "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").
Accordingly, the complaint is dismissed for lack of personal jurisdiction, pursuant to Fed.R.Civ.P. 12(b)(2), and for insufficient service of process, pursuant to Fed.R.Civ.P. 12(b)(5).