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Barclays Bank Mexico, S.A. v. URBI

Supreme Court of New York, New York County

July 15, 2013

BARCLAYS BANK MÉ XICO, S.A.Institución De Banca Mú ltiple Grupo Financiero Barclays Mé xico, Plaintiff,
v.
URBI, Desarrollos Urbanos, S.A.B. de C.V., Defendant. No. 651226/2013.

Editorial Note:

This decision has been referenced in a table in the New York Supplement.

McGuireWoods LLP, for plaintiff.

King & Spalding LLP, for defendant.

SHIRLEY WERNER KORNREICH, J.

Defendant Urbi Desarrollos Urbanos, S.A.B. de C.V. (Urbi) moves to dismiss the Complaint for lack of personal jurisdiction. Defendant's motion is denied for the reasons that follow.

Factual Background & Procedural History

Plaintiff Barclays Bank Mé xico, S.A., Institución de Banca Mú ltiple, Grupo Financiero Barclays Mé xico (Barclays) is a Mexican financial institution. Urbi is a Mexican housing development company. Between December 2010 and February 2013, Barclays and Urbi entered into several derivatives transactions. Since the instant motion only deals with jurisdictional issues, not the merits, the court will not discuss the details of the subject transactions or provide background on how they operate beyond that which is necessary for the purposes of this decision.

On December 14, 2010, the parties executed the standard agreement that governs derivatives transactions: the 1992 ISDA Master Agreement (the Master Agreement), which, pursuant to usual custom and practice, includes and incorporates a Schedule (the Schedule) and Credit Support Annex (the Annex). Pursuant to Section 1(c) of the Master Agreement, the Master Agreement, the Schedule, the Annex, and any subsequent Confirmations (discussed below) collectively constitute " a single agreement" that governs all relevant transactions between the parties. Further, Section 13 of the Master Agreement, as amended by Part 5(i) of the Schedule, provides:

Governing Law. This Agreement will be governed by and construed in accordance with the law specified in the Schedule.

Jurisdiction. With respect to any suit, action or proceedings relating to this Agreement (" Proceedings" ), each party irrevocably:

Submits to the jurisdiction of the English courts if this Agreement is expressed to be governed by English law, or to the exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this agreement is expressed to be governed by the laws of the State of New York and each party hereby irrevocably waives any rights to any other jurisdictions to which it may be entitled on account of place of residence or domicile.

The Schedule provides that New York law governs the parties' agreement.

On February 9 and October 5, 2012, Barclays sent Urbi written confirmations (the Confirmations) of trades that Urbi requested to be executed pursuant to the Master Agreement. The Confirmations stated that each supplements, forms a part of, and is subject to the [Master Agreement]. All provisions of the [Master Agreement] shall govern this Confirmation except as expressly modified below. In the event of any inconsistency between the provisions of the [Master Agreement] and this Confirmation, this Confirmation will prevail for the purposes of the Transactions [defined as the trades specified in each of the Confirmations].

The Confirmations then list all of the pertinent details of the trades, including the trade date, the option style, and the strike rate. The Confirmations contain the following designation: " Governing Law: English." As a result of this designation, defendant contends that this ...


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