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Posted: October 10, 2017

Plaintiff Fails to Provide Evidence Showing Jurisdiction Over Foreign Shipping Company

On September 26, 2017, Justice Scarpulla of the New York County Commercial Division issued a decision in Sonic Finance Inc. v. Prima Bulkship Partnership Ltd., 2017 NY Slip Op. 32033(U), dismissing parties because of the plaintiff’s failure to provide evidence showing that the court had personal jurisdiction over the defendants, explaining:

Here, plaintiffs do not submit any affidavits in opposition to the Moving Defendants showing of lack of long-arm jurisdiction, relying solely on their complaint, which was alleged on information and belief and which fails to identify the source of that information and-belief. Plaintiffs do not allege that the Agreements at issue were negotiated or executed in New York, and there is no allegation that there were meetings here between these Moving Defendants, defendants Prima and Star, and the plaintiffs, involving the Agreements to buy SUNRAY and MOONRA Y.

In fact, the Moving Defendants had no agreements with plaintiffs. The complaint only references a web address, http://halimazmin.com/about-us/business-activities, which indicates that HMB owns and operates vessels that conduct substantial business throughout the East Coast of the United States; according to plaintiffs, this presumably includes New York ports. The website indicates that HMB’s address is in Malaysia, and that its vessels are Malaysian flagged. It also refers to HMB’s unrelated joint venture with nonparty Kawasaki Kisen Kaisha, Ltd., which, according to plaintiffs’ opposition brief, allegedly owns and operates approximately 350 vessels with regular trading destinations in the state of New York. Even if these speculative allegations about some potential New York activity, which do not directly involve HMB, could qualify as a transaction of business, plaintiffs fail to make any connection between this alleged shipping activity, and the claims in the complaint, to warrant the exercise of jurisdiction over these defendants. Plaintiffs’ claims involve the purchase of the two vessels, the SUNRAY and the MOONRA Y, by Prima and Star, and the arbitration of Prima’s and Star’s breach of their obligation to pay for the vessels. HMB’s involvement, with a completely unrelated party, in the business of shipping vessels that may potentially use New York ports is wholly incidental to those claims. Plaintiffs’ internet reference fails to make even a sufficient start to entitle plaintiffs to jurisdictional discovery to oppose defendants’ motion to dismiss. Plaintiffs have not alleged facts which would support jurisdiction under CPLR 301 or 302(a)(1), and, therefore, have failed to show how further discovery might lead to evidence that personal jurisdiction over the Moving Defendants exists here.

(Internal quotations and citations omitted).

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