United States District Court, S.D. New York
December 14, 2004.
SINISA DJORDJEVIC, Plaintiff,
SWISSAIR TRANSPORT CO., LTD., Defendant.
The opinion of the court was delivered by: CHARLES HAIGHT, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Sinisa Djordjevic, appearing pro se, moves this
Court for an order removing the captioned case from the suspense
docket and restoring the case to the Court's active calendar.
Defendant Swissair Transport Co., Ltd. ("Swissair") opposes the
motion. For the reasons that follow, plaintiff's motion is
Plaintiff commenced this action in the Civil Court of the City
of New York in January 2001. Swissair removed the case to this
Court pursuant to 28 U.S.C. § 1331, the source of this Court's
original jurisdiction being that treaty commonly referred to as
the Warsaw Convention, 49 Stat. 3000, as amended. Plaintiff had
purchased a round trip ticket to be transported by Swissair in
August 2000 from JFK, New York, to Belgrade, Yugoslavia with a
stopover in Zurich, Switzerland, and return. On August 22, 2000,
while plaintiff was undergoing a security check at the Zurich
airport, plaintiff stated several times to security personnel
that he had a bomb in his luggage. Plaintiff's luggage was
searched and no bomb was found. However, Swissair decided to
refuse onward carriage to plaintiff and to ban him indefinitely
from Swissair flights, on the ground that "plaintiff posed a threat to the safe operations of Swissair
flights." Affidavit of Werner Schaub, verified June 20, 2001, at
¶ 5. Plaintiff thereafter commenced this action. His complaint
asserts a claim for breach of contract and may also be
interpreted, giving the pro se pleading the requisite liberal
reading, to assert a claim sounding in tort.
Swissair moved for judgment on the pleadings, which plaintiff
opposed. While that motion was pending decision, Swissair filed a
notice of injunction issued by the United States Bankruptcy Court
for this district. Swissair had become the subject of a
liquidation proceeding in a Swiss court under Swiss law. The
Swiss court-appointed Trustee applied to the Bankruptcy Court
pursuant to the United States Bankruptcy Code, 11 U.S.C. § 304,
which provides that "[a] case ancillary to a foreign proceeding
is commenced by the filing with the bankruptcy court of a
petition under this section by a foreign representative." §
304(a). The statute authorizes bankruptcy courts, inter alia,
to "enjoin the commencement or continuation of any action against
a debtor with respect to property involved in such foreign
proceeding . . ." § 304(b)(1)(A)(I). Swissair's § 304 petition
was signed by Karl Wuthrich, as Temporary Trustee of Swissair.
On October 18, 2001, the United States Bankruptcy Court issued
a Preliminary Injunction Order, signed by Chief United States
Bankruptcy Judge Stuart M. Bernstein, which enjoined Swissair
creditors from, inter alia, "commencing or continuing any
action or legal proceeding in the United States . . ." First
decretal paragraph at pp. 3-4.
Plaintiff applied to the Bankruptcy Court for relief from that
court's injunction in respect of his claim against Swissair.
Chief Bankruptcy Judge Bernstein denied that application in an
Order dated October 28, 2003. His Order also provided, in the
second and last decretal paragraph, "that Swissair shall allow
Applicant's claim in the amount of $943.42, and shall pay such
claim pari passu with all other general unsecured claims."*fn1 Counsel for
Trustee Wuthrich, opposing plaintiff's present application, say
that "Swissair has complied with the [Bankruptcy Court's] Order,
and Plaintiff's claim is registered in the Swiss proceeding."
Memorandum in Opposition at ¶ 6. Accordingly plaintiff will
eventually recover on his contract claim against Swissair in
accordance with whatever percentage the Swiss court awards to
unsecured creditors such as plaintiff.
Plaintiff is understandably dissatisfied with this state of
affairs. He prefers to litigate his claims in this Court, closer
to home, rather than be relegated to a Swiss court and Swiss law.
He argues, among other points, that denying an American citizen
access to an American court is contrary to the Constitution. It
is impossible not to sympathize with plaintiff. This Court must
recognize, however, that in the Bankruptcy Code, 11 U.S.C. § 304,
the Congress explicitly authorized and directed the Bankruptcy
Courts, upon the application of foreign debtors such as Swissair,
to issue injunctions of the sort that bars plaintiff, even though
a United States citizen, from proceeding on his claim in this
Court and requires him to file his claim in a foreign court. The
injunction covers all claims, sounding in both contract and tort,
and so it is of no moment that Chief Judge Bernstein's October
23, 2003 Order does not refer to plaintiff's tort claims. The
Second Circuit Court of Appeals (whose decisions are binding upon
this Court) has explained the policy considerations underlying
Section 304(a) authorizes a foreign representative in
a foreign bankruptcy proceeding to commence a case
ancillary to that proceeding in a United States
bankruptcy court to protect the administration of the
foreign proceeding. The purpose of a § 304 petition is to prevent the piecemeal distribution of
assets in the United States by means of legal
proceedings initiated in domestic courts by local
In Re Koreag, Controle et Revision S.A., 961 F.2d 341
, 348 (2d
Cir. 1992) (internal quotation marks, brackets and citations
omitted). The Court's research indicates that it has never been
suggested, let alone held by a court, that § 304 of the
Bankruptcy Code exceeds the constitutional powers of the
I have considered plaintiff's other contentions and criticisms
about the manner in which the Bankruptcy Court administered his
claim. This Court would have jurisdiction to adjudicate such
issues only on an appeal to the District Court from the orders of
the Bankruptcy Court, which plaintiff has not filed. But there
would be no purpose in his doing so, since plaintiff's
contentions, taken singly or in the aggregate, do not change the
basic reality of the case, namely, that the Bankruptcy Court
enjoined plaintiff from continuing his claim against Swissair in
this Court and relegated him to the Swiss court in accordance
with a valid act of Congress.
Accordingly plaintiff's present application to reinstate the
captioned case on this Court's active calendar will be denied.
The case will remain on the Court's suspense docket.
Plaintiff also applies for leave to amend his complaint to
assert a negligence claim against Karl Wuthrich, the Swissair
Trustee. Plaintiff charges the Trustee with "negligent
administering of the claim matter, in particular the notice of
the PIO, a plaintiff's letter, an application for relief from the
PIO and the original proof of claim." Plaintiff's motion at ¶ 12.
While leave to amend a pleading "shall be freely given when
justice so requires," Rule 15(a), Fed.R.Civ.P., leave will be
denied when the proposed amendment is futile in law. That is the
fact in the case at bar, since Wuthrich, a Swiss resident, is not
subject to the personal jurisdiction of this Court. His special appearance as Swissair's Trustee for the purpose of filing a
petition in the Bankruptcy Court does not subject Wuthrich to the
personal jurisdiction of the District Court.
Nor could the New York long-arm statute confer such
jurisdiction, since it is apparent from the motion papers that
whatever failures or imperfections of communication may have
arisen during the Bankruptcy Court proceeding, plaintiff's claim
has been agreed to by Swissair and safely lodged in the Swiss
liquidation proceeding. See Swissair's memorandum in opposition
at ¶ 10:
In sum, Plaintiff's claim is registered, and he need
take no affirmative steps, despite the return of the
proof of claim filed in the U.S. ancillary
proceeding. Moreover, the registering of the claim as
an allowed claim effectively grants the relief sought
by Plaintiff. While Swissair makes no representation
as to the timing or amount of any distribution,
Plaintiff's claim will be treated like all other
general unsecured claims.
The significance of these undisputable circumstances in the
present context is that plaintiff could not prove that Wuthrich's
conduct in New York caused him any damage; and it follows that
the long-arm statute would not operate to establish personal
jurisdiction in this Court over Wuthrich. To recapitulate: (1) plaintiff's application to restore the
captioned case to the Court's active calendar is denied; and (2)
plaintiff's application to amend his complaint in order to assert
a negligence claim against Karl Wuthrich is denied.
It is SO ORDERED.