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Igor Desyatnikov v. Credit Suisse Group

March 26, 2012


The opinion of the court was delivered by: Dora L. Irizarry, United States District Judge:


Plaintiff Igor Desyatnikov filed the instant action against defendants Credit Suisse Group, Inc. ("Credit Suisse") and Clariden Leu Bank, n/k/a, Clariden Leu ("Clariden Leu"), asserting violations of federal securities laws as well as claims under New York law, arising out of the purchase of a foreign security. (See Complaint, Doc. Entry No. 1.) Credit Suisse moves to dismiss the complaint, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, and 28 U.S.C. § 1367(c)(3). (See Memorandum of Law in Support of Credit Suisse Motion to Dismiss ("Credit Suisse Mem."), Doc. Entry No. 11.) Clariden Leu moves to dismiss, pursuant to Rules 12(b)(2), 12(b)(3), and 12(b)(6) of the Federal Rules of Civil Procedure, as well as the doctrine of forum non conveniens, and 28 U.S.C. § 1367(c)(3). (See Memorandum of Law in Support of Clariden Leu Motion to Dismiss ("Clariden Leu Mem."), Doc. Entry No. 15.) Plaintiff opposes both motions. (See Plaintiff's Combined Memorandum of Law in Opposition to Defendants' Motions to Dismiss ("Pl. Opp."), Doc. Entry No. 22.) For the reasons set forth below, defendants' motions to dismiss are granted.


Plaintiff is a dual citizen of the United States and Russia. In 2006, plaintiff opened an investment account with Clariden Leu's Singapore branch office. Clariden Leu is an investment bank incorporated in Switzerland. Its parent company is Credit Suisse, a company which also is incorporated in Switzerland. Plaintiff alleges that his agent at Clariden Leu purchased a security that he had specifically prohibited the agent from purchasing, without his prior knowledge or consent. Plaintiff alleges various violations of federal securities law and New York state law arising out of this transaction.


I. Legal Standards

Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." The pleading standard under Rule 8 does not require "detailed factual allegations," Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007), "but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). A complaint does not "suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Id. (quoting Twombly, 550 U.S. at 557). A plaintiff's obligation to provide the "grounds" of his "entitle[ment] to relief" requires more than labels and conclusions, and a formulaic recitation of a cause of action's elements will not do. Twombly, 550 U.S. at 555.

On a Rule 12(b)(6) motion, the court must accept as true all factual statements alleged in the complaint and draw all reasonable inferences in favor of the nonmoving party. Taylor v. Vt. Dep't of Educ., 313 F. 3d 768, 776 (2d Cir. 2002). The court may only consider the pleading itself, documents that are referenced in the complaint, documents that the plaintiff relied on in bringing suit and that are either in the plaintiff's possession or that the plaintiff knew of when bringing suit, and matters of which judicial notice may be taken. See Chambers v. Time Warner, Inc., 282 F. 3d 147, 153 (2d Cir. 2002); Int'l Audiotext Network, Inc. v. Am. Tel. & Tel. Co., 62 F. 3d 69, 72 (2d Cir. 1995).

II. Credit Suisse's Motion to Dismiss

"It is well settled that where the complaint names a defendant in the caption but contains no allegations in the complaint indicating how the defendant violated the law or injured the plaintiff, a motion to dismiss the complaint in regard to that defendant should be granted." Jackson v. Cnty. of Nassau, 2009 WL 393640, at *3 (E.D.N.Y. Feb. 13, 2009) (dismissing claims against two defendants as the complaint did not contain any allegations of wrong doing by those defendants) (internal citations and quotations omitted). Moreover, a parent corporation is not liable for the acts of its subsidiary. See, e.g., United States v. Bestfoods, 524 U.S. 51, 61 (1998) ("It is a general principle of corporate law deeply ingrained in our economic and legal systems that a parent corporation . . . is not liable for the acts of its subsidiaries."). To circumvent this principle and hold a corporate parent liable, the plaintiff must pierce the corporate veil by setting forth allegations showing "actual domination by the corporate parent over the corporate subsidiary, rather than mere ownership." In re Natural Gas Commodity Litig., 337 F. Supp. 2d 498, 515 (S.D.N.Y. 2004) (citing De Jesus v. Sears, Roebuck & Co., Inc., 87 F.3d 65, 69-70 (2d Cir. 1996)).

The allegations against Credit Suisse are insufficient as a matter of law. The complaint does not contain allegations of wrong doing attributed to Credit Suisse; rather, the complaint focuses on Clariden Leu and its agent. The only link that the complaint asserts is that Credit Suisse is the parent company to Clariden Leu, which is insufficient to hold Credit Suisse liable.

Contrary to plaintiff's contention, it is not premature to dismiss Credit Suisse at this stage of the litigation. Permitting plaintiff discovery on the relationship between Credit Suisse and Clariden Leu would be permitting a "fishing expedition," which this Court declines to allow. Accordingly, the Court grants Credit Suisse's motion to dismiss for failure to state a claim with prejudice. As set forth below, amendment of the complaint against Credit Suisse would be futile, and, thus, the Court declines to allow plaintiff to amend the complaint in that regard.

III. Clariden Leu's Motion to Dismiss

"A court is obligated to dismiss an action against a defendant over which it has no personal jurisdiction upon motion by that defendant." TAGC Mgt., LLC v. Lehman, 2011 WL 3796350, at *3 (S.D.N.Y. Aug. 24, 2011) (internal quotations omitted). "A plaintiff opposing a motion to dismiss a complaint for lack of personal jurisdiction pursuant to Rule 12(b)(2) bears the burden of establishing that the court has jurisdiction over the defendant." Id. (internal quotations omitted). When, as here, "a court relies on pleadings and affidavits, rather than conducting a full-blown evidentiary hearing, the plaintiff need only make a prima facie showing that the court possesses personal jurisdiction over the defendant." DiStefano v. Carozzi N. Am., Inc., 286 F. 3d 81, 84 (2d Cir. 2001). "Although a plaintiff's allegations are ordinarily accepted as true at the pleadings stage, on a motion to dismiss for lack of jurisdiction, where [a] 'defendant rebuts [a] plaintiff['s] unsupported allegations with direct, highly specific, testimonial evidence regarding a fact essential to jurisdiction-and plaintiff[] ...

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