OPINION & ORDER Reed International, Inc., is a company headquartered in Virginia that provided security, training, and logistics services in support of the United States Military in Afghanistan. Doc. 1
1, 8. It brings this breach of contract action against Afghanistan International Bank (“AIB”). In order to obtain a private security company license from the Ministry of Interior Affairs of Afghanistan (“the Ministry”), the Ministry required Reed to obtain a bank guarantee from a licensed bank in Afghanistan. Reed secured a guarantee from AIB, which is based in and operates in Afghanistan. Reed also maintained a bank account with AIB. Upon the expiration of the guarantee, Reed requested the return of its funds in the guarantee as well as in its bank account. AIB refused to do so. Reed alleges that AIB’s refusal to release the funds is a breach of the guarantee and account agreements. Both the guarantee and account agreement contain forum selection clauses designating Afghanistan as the proper forum for any disputes arising out of those contracts, however, Reed filed the instant complaint in this District. Pending before the Court are two motions: (1) AIB’s motion to dismiss the complaint for forum non conveniens, improper venue, and lack of personal jurisdiction; and (2) Reed’s motion for limited jurisdictional discovery. For the reasons discussed below, AIB’s motion to dismiss is GRANTED, and Reed’s motion for limited jurisdictional discovery is DENIED. I. BACKGROUND A. Factual background The Ministry required Reed to obtain a bank guarantee from a bank registered and licensed by Afghanistan’s central bank, Da Afghanistan Bank (“DAB”) in order to obtain a private security company license. Doc. 1 1, 18. On August 22, 2018, Reed obtained the guarantee from AIB in exchange for cash collateral in the amount of $300,000. Id. 1. AIB is the largest private bank in Afghanistan and is charted under, and operates subject to, the commercial banking laws of Afghanistan. Id. 9. By its terms the guarantee was initially set to expire on August 23, 2019. Id. 19. The guarantee was extended twice and remained valid and in effect through August 21, 2021. Id. AIB submits that in addition to signing the guarantee, Reed also issued a counter-guarantee for and on behalf of itself to AIB on September 24, 2018 from its office in Kabul, the capital of Afghanistan. See Doc. 22 11; Doc. 22-5. Reed does not mention the counter-guarantee in its briefing. Lastly, Reed maintained an ordinary bank account with AIB under an account agreement. Doc. 1 3; Doc. 22-1. Reed alleges that the account had a balance of $16,062.84 as of August 31, 2021. Doc. 1 3. The Court notes that, in mid-April 2021, United States President Joseph Biden declared that American troops would leave Afghanistan by September 11 of that year.1 On August 15, 2021, over two weeks before the official planned U.S. withdrawal date, Taliban fighters entered Kabul.2 United States troops had withdrawn completely by August 31, 2021.3 In 2021 Reed decided not to renew its license with the Ministry beyond August 21, 2021, and shut down its operations in Afghanistan that month. Doc. 1 23. Accordingly, on September 1, 2021, Reed demanded that AIB return its funds held on deposit via letter.4 Id. 6. The funds were not released to Reed. Id. By letter dated September 23, 2021, Reed again requested the return of the funds securing the guarantee. Doc. 1-4. In response, AIB replied via letter outlining the appropriate procedure Reed needed to follow for the release the funds. Doc 1-5. Specifically, Reed was instructed to submit a “No Claim Letter” from the Ministry and the “Original Guarantee” with all its subsequent amendments. Id. Reed did not follow these procedures. According to Reed, “AIB knows that it is unlikely that Reed…will travel to Afghanistan and get the originals of the [g]uarantees and a [no claim] letter back from the [Ministry].” Doc. 1 31. Reed also requested that AIB transfer the $16,062.84 from its bank account. In response, AIB informed Reed that all international transactions were currently on hold based on instruction of DAB circular no. 7618/6733. Doc. 1-5 1. Reed claims its demand was unlawfully denied. Doc. 1 6. Forum selection provisions The guarantee states that it is subject to the Uniform Rules for Demand Guarantees, ICC Publication No. 758 (“URDG 758″),5 which contain a mandatory forum selection clause that requires any dispute concerning the guarantee to be heard in Afghanistan. See Doc. 1-2 at 1. “Unless otherwise provided in the guarantee, any dispute between the guarantor and the beneficiary relating to the guarantee shall be settled exclusively by the competent court of the country of the location of the guarantor’s branch or office that issued the guarantee.” URDG 758 Art. 35(a). In the guarantee, AIB is the guarantor and the Ministry is the beneficiary. Critically, however, the counter-guarantee Reed issued to AIB is also subject to the URDG, and therefore subject to the URDG’s forum selection clause. “Where, at the request of the counter-guarantor, a demand guarantee is issued subject to the URDG, the counter-guarantee shall also be subject to the URDG, unless the counter-guarantee excludes the URDG.” See URDG 758, Art. 1(b). URDG 758 provides that any dispute between Reed (as counter-guarantor) and AIB (as the guarantor) “shall be settled exclusively by the competent court of the country of the location of the counter-guarantor’s branch or office that issued the counter-guarantee.” URDG 758, Art. 35(b). Because Reed issued the counter-guarantee from its Kabul office, Afghanistan is the designated venue. Doc. 22-5. The Parties do not dispute that they agreed to the terms of the guarantee and the account agreements. Likewise, the account agreement provided that Reed agreed to be bound by Afghan law and required the parties to submit to jurisdiction in Afghanistan should any disputes arise (“Any complaint or claim against [] [AIB] must be lodged in Afghanistan and with the Office of CEO of the Bank or as prescribed by the [DAB].”). Doc. 22-1 30(b). B. Procedural background Reed filed the instant complaint on December 13, 2021, alleging breach of contract, and in the alternative, unjust enrichment. It sought to recover a total of $316,062.84. Doc. 1 49. On April 26, 2022, AIB filed a motion to dismiss, arguing that the forum selection clauses in the guarantee and the account agreements require this Court to dismiss the complaint on the basis of forum non conveniens. Alternatively, AIB argues venue is improper in this district, and that AIB is not subject to personal jurisdiction in this Court. Doc. 23 at 6-7. Concurrently, on May 9, 2022, Reed filed a motion for jurisdictional discovery. Doc. 24. II. LEGAL STANDARDS A. Personal jurisdiction In diversity or federal question cases, personal jurisdiction is determined in accordance with the law of the forum in which the federal court sits. Whitaker v. Am. Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2001) (citing Bensusan Rest. Corp. v. King, 126 F.3d 25, 27 (2d Cir. 1997)). This determination involves a two-step analysis. Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 567 (2d Cir. 1996). In New York, courts must first determine whether personal jurisdiction is appropriate pursuant to the State’s general jurisdiction statute, Civil Practice Law and Rules (“C.P.L.R.”) §301, or its specific jurisdiction statute, C.P.L.R. §302. General jurisdiction over foreign corporations is proper when the corporation’s affiliations are so continuous and systematic that they are essentially “at home” in the forum state. Daimler AG v. Bauman, 134 S. Ct. 746, 754 (2014). “Specific jurisdiction is a significantly more limited doctrine” than general jurisdiction. Dennis v. JPMorgan Chase & Co., 343 F. Supp. 3d 122, 202 (S.D.N.Y. 2018). For a state court to exercise specific jurisdiction, the suit must arise out of the defendants’ contacts which create a substantial connection with the forum state. Id. at 202-03. The due process inquiry requires courts to evaluate the “quality and nature of the defendant’s contacts with the forum state under a totality of the circumstances test.” Licci ex rel. Licci v. Lebanese Canadian Bank, SAL, 732 F.3d 161, 170 (2d Cir. 2013) (quoting Best Van Lines, Inc. v. Walker, 490 F.3d 239, 246 (2d Cir. 2007)). Additionally, courts in New York State may exercise specific personal jurisdiction over defendants under the New York long-arm statute if (1) the defendant transacts any business within the state, and (2) the cause of action arises from that business transaction. Alibaba Grp. Holding v. Alibabacoin Found., No. 18 Civ. 2897(JPO), 2018 WL 2022626, at *4-8 (S.D.N.Y. Apr. 30, 2018) (citations omitted); see also C.P.L.R. §302(a)(1) (NY long-arm statute). “A suit will be deemed to have arisen out of a party’s activities in New York if there is an articulable nexus, or a substantial relationship, between the claim asserted and the actions that occurred in New York.” Royalty Network Inc. v. Dishant.com, LLC, 638 F. Supp. 2d 410, 422 (S.D.N.Y. 2009) (quoting Best Van Lines, 490 F.3d at 246). B. Venue “The legal standard for a motion to dismiss for improper venue is the same as a motion to dismiss for lack of personal jurisdiction.” Casville Invs., Ltd. v. Kates, 12 Civ. 6968 (RA), 2013 WL 3465816, at *3 (S.D.N.Y. July 8, 2013) (citing Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005)). “When a defendant challenges either the jurisdiction or venue of the court, the plaintiff bears the burden of showing that both are proper.” Id. (citing DiStefano v. Carozzi N. Am., Inc., 286 F.3d 81, 84 (2d Cir. 2001); Savoy Senior Hous. Corp. v. TRBC Ministries, 401 B.R. 589, 596 (S.D.N.Y. 2009)). To meet this burden, the plaintiff must plead facts sufficient for prima facie showing of jurisdiction or venue. Glasbrenner, 417 F.3d at 355 (citing CutCo Indus. v. Naughton, 806 F.2d 361, 364-65 (2d Cir. 1986)). Venue is proper in the chosen forum if: (1) at least one defendant resides in the district and all the defendants reside in the same state in which the district is located, (2) a “substantial part” of the events giving rise to the claim occurred in the district, or (3) the defendant is subject to personal jurisdiction in the district and “there is no district in which an action may otherwise be brought.” 28 U.S.C. §1391(b). C. Forum non conveniens The appropriate procedural mechanism for filing a motion to enforce a forum selection clause designating a foreign forum is a motion to dismiss for forum non conveniens. Atlantic Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas, 571 U.S. 49, 60 (2013). The forum non conveniens doctrine allows a court to dismiss an action “even if the court is a permissible venue with proper jurisdiction over the claim.” LaSala v. Bank of Cyprus Pub. Co. Ltd., 510 F. Supp. 2d 246, 254 (S.D.N.Y. 2007) (quoting Carey v. Bayerische Hypo-und Vereinsbank AG, 370 F.3d 234, 237 (2d Cir. 2004)). “A decision to grant or deny a motion to dismiss a cause of action under the doctrine of forum non conveniens lies wholly within the broad discretion of the district court.” Scottish Air Int’l, Inc. v. British Caledonian Grp., PLC, 81 F.3d 1224, 1232 (2d Cir. 1996). Ordinarily, a three-step analysis guides the exercise of this discretion. If there is a forum selection clause at issue, however, the calculus is altered because a valid forum selection clause is given “controlling weight in all but the most exceptional cases.” Atlantic, 571 U.S. at 51; see also M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972) (forum selection clauses are “prima facie valid” and should be enforced unless demonstrated to be “unreasonable” under the circumstances). In such instances, the Court must determine (1) whether the forum selection clause is valid, and (2) whether public interest factors nevertheless counsel against its enforcement. Midamines SPRL Ltd. v. KBC Bank NV, 12 Civ. 8089 (RJS), 2014 WL 1116875 at *3 (S.D.N.Y. Mar. 18, 2014). D. Jurisdictional discovery Whether to allow jurisdictional discovery is “a decision as to which a district court enjoys substantial discretion.” Keren Chasanim Corp. v. Vill. of Kiryas Joel, No. 07 Civ. 262 (SCR), 2008 WL 11518871, at *5 (S.D.N.Y. Nov. 10, 2008); see also Broidy Cap. Mgmt. LLC v. Benomar, 944 F.3d 436, 446 (2d Cir. 2019) (“[T]he district court has considerable latitude in devising the procedures it will follow to ferret out the facts pertinent to jurisdiction.” (quoting Foremost-McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d 438, 449 (D.C. Cir. 1990))). Yet, “a court…does not abuse its discretion in denying jurisdictional discovery ‘if the party seeking discovery cannot articulate a reasonable basis for the court first to assume jurisdiction.’” Beierwaltes v. L’Office Federale De La Culture De La Confederation Suisse, 999 F.3d 808, 828 (2d Cir. 2021) (quoting Arch Trading Corp. v. Republic of Ecuador, 839 F.3d 193, 206-07 (2d Cir. 2016)). While the bar for granting “jurisdictional discovery is “low,” Universal Trading & Inv. Co. v. Credit Suisse (Guernsey) Ltd., 560 F. App’x 52, 55 (2d Cir. 2014), and it is appropriately granted where a plaintiff’s allegations make a “sufficient start” toward establishing personal jurisdiction, Uebler v. Boss Media, AB, 363 F. Supp. 2d 499, 506 (E.D.N.Y. 2005), “if the plaintiff has failed to establish a prima facie case for personal jurisdiction, jurisdictional discovery is generally not granted.” RSM Prod. Corp. v. Fridman, 643 F. Supp. 2d 382, 402 (S.D.N.Y. 2009). However, if a plaintiff has identified a genuine issue of jurisdictional fact, discovery is appropriate even in the absence of a prima facie showing as to jurisdiction. Daventree Ltd. v. Republic of Azerbaijan, 349 F. Supp. 2d 736, 761 (S.D.N.Y. 2004). Nevertheless, “a court is not obligated to subject a foreign corporation to discovery where the allegations of jurisdictional facts…fail to state a basis for the exercise of jurisdiction or where a plaintiff’s proposed discovery, if granted, would not uncover facts sufficient to sustain jurisdiction,” Daventree Ltd., 349 F. Supp. 2d at 761, and “discovery need not be granted to permit a fishing expedition for jurisdictional facts,” Greer v. Carlson, No. 20 Civ. 5484, 2020 WL 6064167, at *5 (S.D.N.Y. Oct. 14, 2020) (citing RSM Prod. Corp., 643 F. Supp. 2d at 402). III. DISCUSSION AIB moves to dismiss Reed’s claims on the bases of lack of personal jurisdiction, improper venue, and forum non-conveniens. It primarily argues that Reed agreed to the forum selection clauses in the guarantee and account agreements and therefore this matter must be heard in Afghanistan. In its motion for jurisdictional discovery, Reed argues that personal jurisdiction is appropriate and requests this Court require AIB to submit to jurisdictional discovery. Accordingly, the question of personal jurisdiction guides the Court’s analysis here. A. Reed fails to establish personal jurisdiction In its complaint, Reed alleges that “personal jurisdiction exists pursuant to CPLR §302(a)(1) as AIB regularly transacts business within the state of New York.” Doc. 1 16. In its response to AIB’s motion to dismiss it also asserts, for the first time, that “AIB’s contacts with New York and this District are sufficient for this Court to exercise general jurisdiction over AIB.” Doc. 28 at 18. In New York, personal jurisdiction may be established over a defendant by general jurisdiction under C.P.L.R §301, or specific jurisdiction under New York’s long-arm statute under C.P.L.R §302(a)(1). Section 301 confers general jurisdiction where a company “has engaged in such a continuous and systematic course of doing business in New York that a finding of its presence in New York is warranted.” Sonera Holding B.V. v. Cukurova Holding A.S., 750 F.3d 221, 224 (2d Cir. 2014) (internal quotations, modifications and citation omitted). “[T]he general jurisdiction inquiry ‘is not whether a foreign corporation’s in-forum contacts can be said to be in some sense continuous and systematic,’ but rather…’whether that corporation’s affiliations with the State are so continuous and systematic as to render it essentially at home in the forum.’” Brown v. Lockheed Martin Corp., 814 F.3d 619, 627 (2d Cir. 2016) (quoting Daimler 571 U.S. 117, 119, 139 (2014)). New York’s long-arm statute permits the exercise of specific jurisdiction over a nondomiciliary if the defendant “transacts business within the state” and the “cause of action arise[s] from” that transaction. C.P.L.R §302(a)(1); see also Eades v. Kennedy, PC Law Offices, 799 F.3d 161, 168 (2d Cir. 2015) (internal quotation marks and citations omitted). A defendant transacts business within the meaning of §302(a)(1) when it purposefully “avails itself of the privilege of conducting activities [in New York], thus invoking the benefits and protections of its laws.” Fischbarg v. Doucet, 9 N.Y.3d 375, 380 (2007) (quoting McKee Elec. Co. v. Rauland-Borg Corp., 20 N.Y.2d 377, 382 (1967)). Reed rests its arguments for jurisdiction primarily on the relationships between AIB and two New York banks — Standard Chartered Bank New York and the Bank of New York Mellon (“BNY Mellon”). Additionally, it cites AIB’s internet activity, alleged marketing, and other banking services as sufficiently substantial to confer jurisdiction. Doc. 28 at 17-18. Neither these banking relationships nor AIB’s other activities tangentially related to New York are sufficient to confer jurisdiction under §§301 or 302(a)(1). 1. AIB’s banking relationships First, Reed alleges that AIB has maintained a correspondent banking relationship, including New York bank accounts, financial assets, and a demand deposit account with Standard Chartered Bank, and as a result, insists that there have been continuous and systematic contacts via these activities sufficient to confer personal jurisdiction. Doc. 28 at 6, 16-17. Secondly, Reed argues that personal jurisdiction is appropriate because of AIB’s relationship with the Bank of New York Mellon (“BNY Mellon”). Reed also alleges that AIB has a banking agreement and “assets” with Citibank. Doc. 28 at 17. a. Standard Chartered Bank and §301 jurisdiction Reed submits that AIB has admitted to holding a New York bank account with Standard Chartered Bank in a number of federal filings in a D.C. District Court case. Doc. 28-3 86; See U.S. v. Sum of $70,990,605, No. 14-5031, 2014 WL 4629117 (D.C. Cir. July 18, 2014); see also Doc. 28-4 6. Reed also provides an excerpt from AIB’s 2020 Annual Report in support of its claims that AIB held “financial assets” in Standard Chartered Bank: 14.1 Receivable from DoJ — This represents receivables from the [DoJ]…[t]he DoJ seized an amount of AFN 565.701 million (equivalent to USD 10.1 million) from the Bank’s account with Standard Chartered’s branch in New York…. the United States sought to reach the customer’s Afghan-based accounts by seizing funds from the Bank’s correspondent account in the United States. Doc. 28 at 17. However, the excerpt provided by Reed divorces the admission from important temporal context, as these assets were returned in 2013. See id., see also Doc. 31 at 12. Moreover, while AIB does in fact admit to having had a correspondent banking relationship with Standard Chartered Bank, that relationship ended by October 2019. See Second Declaration of Carasso (“Second Carasso Decl.”), Doc. 30 5; see also Carasso Opposition Declaration (“Carasso Opp. Decl.”), Doc. 32 10. Taken altogether, Reed argues that AIB has significant and lengthy ties to New York and this District and, accordingly, this Court has personal jurisdiction over AIB. Doc. 28 at 4. However, “mere contacts” with the forum, “no matter how systematic and continuous are extraordinarily unlikely” to qualify for the exercise of general jurisdiction. Brown, 814 F.3d at 629; see also In re Roman Catholic Diocese of Albany, N.Y., Inc., 745 F.3d 30, 39-41 (2d Cir. 2014) (finding that conducting a weekly mass in the forum state, even if to some degree continuous and systematic, is not “so ‘continuous and systematic’ as to render [the Diocese] essentially at home in the forum State.”). Further, to confer jurisdiction under §301, the defendant must be doing business in the purported jurisdiction at the time the action is brought. Puerto Rico Mar. Shipping Auth. v. Almogy, 510 F. Supp. 873, 878 (S.D.N.Y. 1981); see also In re Terrorist Attacks on Sept. 11, 2001, 718 F. Supp. 2d 456, 476-77 (S.D.N.Y. 2010), aff’d on other grounds, 714 F.3d 109 (2d Cir. 2013) (declining to confer general jurisdiction over the bank because its office was not in existence at the time plaintiffs brought their action). This action was brought in December 2021 and all of the connections to Standard Chartered Bank that Reed alleges took place prior to that time. Indeed, Reed’s own Exhibit 1-D contains an email dated September 26, 2019 in which AIB informs its customers that “[AIB] is closing its [U.S. dollar] account with Standard Chartered Bank, New York and [U.S. dollar] inward payments to [AIB] will not be made through [Standard Chartered Bank].” See Doc. 36-5 at 2. Thus, any account AIB may have held with Standard Chartered Bank would not confer jurisdiction under §301 for the instant claim, which arose in 2021. b. Standard Chartered Bank and §302(a)(1) jurisdiction Nor can jurisdiction be conferred under §302(a)(1) based on AIB’s correspondent banking relationship with Standard Chartered Bank, as Reed argues. Doc. 28 at 16. However, “by itself, a correspondent bank relationship, without any other indicia or evidence to explain its essence, may not form the basis for long-arm jurisdiction under [§302(a)(1)].” Daou v. BLC Bank, S.A.L., 42 F.4th 120, 129 (2d Cir. 2022) (quoting Amigo Foods Corp. v. Marine Midland Bank-New York, 39 N.Y.2d 391, 396 (1976). To confer long-arm jurisdiction, the correspondent banking account must have some relationship to the claims alleged from which the court can infer that the correspondent account played any role in the alleged injury. State of Qatar v. First Abu Dhabi Bank PJSC, 2022 WL 2158364, at *3 (N.Y. Sup. Ct. June 13, 2022). Although multiple transfers to a New York account may establish minimum contacts with the state, a plaintiff must still establish “at a minimum, a relatedness between the transaction[s] and the legal claim such that the latter is not completely unmoored from the former.” Universal Trading, 560 F. App’x at 55 (2d Cir. 2014) (quoting Licci v. Lebanese Canadian Bank, 20 N.Y.3d 327, 339 (2012)). Reed does not allege any connection between this New York correspondent banking relationship and the instant breach of contract claim. “A suit will be deemed to have arisen out of a party’s activities in New York if there is an articulable nexus, or a substantial relationship, between the claim asserted and the actions that occurred in New York.” Royalty Network Inc. v. Dishant.com, LLC, 638 F. Supp. 2d 410, 422 (S.D.N.Y. 2009) (quoting Best Van Lines, 490 F.3d 239, 246 (2007)). See Al Rushaid v. Pictet & Cie, 28 N.Y.3d 316, 328 (2016) (concluding that the non-domiciliary’s use of a correspondent bank “was precisely part of the defendant’s design” to launder profits and that this was sufficient to constitute the transaction of business in New York under §302(a)(1)); see also Licci v. Lebanese Canadian Bank, 20 N.Y.3d 327, 340 (2012) (conferring jurisdiction under §302(a)(1) where the non-domiciliary bank “deliberately used a New York account again and again to support Shahid and shared terrorist goals[]“). While Reed does offer evidence that AIB directed Reed to transfer funds through Standard Chartered Bank in New York, it fails to connect those transfers to the claim at issue. Doc. 36 at 7-8. Reed alleges that from August 2016 through September 2019, it transferred approximately $400,000.00 per month, most of which was transferred through Standard Chartered Bank in New York at the direction of AIB. See Rankin Decl., Doc. 36-1
