United States District Court, District of Columbia
E. BOASBERG, United States District Judge.
Kaupthing ehf, an Icelandic bank, sold billions of dollars in
notes to investors throughout the world. One such investor
was Defendant Bricklayers and Trowel Trades International
Pension Fund, which owned a series of these notes until
Kaupthing bought them back under a repurchase provision. When
Kaupthing thereafter went bankrupt, it filed a suit in
Iceland to rescind the buy-back and recover the monies
expended. The Fund, a resident of the District of Columbia,
never appeared overseas to defend itself, and a default
judgment resulted. That judgment, however, did not name the
Fund as a liable party; instead, the Icelandic court ordered
another party - an account owned by the Fund - to pay
Kaupthing $422, 296.
has come to this Court to enforce the Icelandic Judgment,
suing the Account, the Fund, and the Fund's Board of
Trustees. Defendants now move to dismiss, arguing that the
Account lacks the capacity to be sued, the Icelandic Judgment
does not name the Fund or the Trustees as liable parties, and
Defendants, in any event, were not subject to personal
jurisdiction in Iceland. Agreeing with all of these
contentions, the Court will grant the Motion.
Court treats the facts set forth in the Complaint as true, as
it must at this stage, but also draws much of the background
from the Icelandic Judgment itself. Plaintiff is an Icelandic
corporation. See Am. Compl., ¶ 4. In 2007, it
initiated a multi-billion-dollar program in which it sold
certain securities - namely, the notes at issue in this case
- to investors all over the world. See ECF No. 11,
Exh. C (Icelandic Judgment) at 2-3. Although the notes at
issue originated with Plaintiff, investors purchased them
through a program run by an American clearing house.
Id. at 3-4. These notes and their indentures were
also to be construed and governed “entirely in
accordance with the law of the State of New York.”
Id. at 5. Purchase of a note entitled its owner to
receive semiannual payments from Plaintiff and to eventually
cash out at specified maturity dates. Id. at 3.
Plaintiff, however, was empowered by a repurchase provision
in the note program's prospectus to buy back outstanding
notes and reduce its liability under the program by
extinguishing them. Id. at 5.
2008, Plaintiff exercised this power under the repurchase
provision and bought back notes owned by Bricklayers and
Trowel Trades International Pension Fund - a District of
Columba resident. Id. at 6; Am. Compl., ¶ 6.
The Fund, before the buy-back, held the notes in an account
called the Bricklayers and Trowel Trades International
Pension Fund Liquidation Portfolio (Account). See
Icelandic Judgment at 7. Management of the Account was
entrusted to the Western Asset Management Company - the
Fund's agent - but the Fund maintained ultimate control
over the Account and the notes contained therein.
Id. Emails exchanged between Plaintiff and WAMC
culminated in a “single transaction” whereby
Plaintiff transferred payment to the Account, and, in return,
its outstanding liabilities under the note program were
reduced by the value of the interest purchased. Id.
went bankrupt shortly thereafter. Id. Its bankruptcy
entitled it, under Icelandic law, to rescind its buy-back of
the Fund's notes and to recover the sum paid.
Id. at 8. Plaintiff filed a lawsuit in Iceland in
June 2012 to pursue that end. Id. at 7-8; Am. Comp.,
¶ 10. The complaint named WAMC as “primary
defendant, ” the Account as “alternative
defendant, ” and the Fund as “defendant of last
resort.” See Am. Compl., ¶ 10. Only WAMC,
however, appeared in Icelandic court to defend itself.
Id., ¶ 12.
court ultimately declined to impose liability on WMAC because
it “was involved in the transaction only as an
intermediary.” Icelandic Judgment at 13, 16; Am.
Compl., ¶ 14. Next setting its sights on the Account,
the Court held that it was “a legal person capable of
having legal rights” and was thus able to “be the
defendant in a lawsuit.” Icelandic Judgment at 15. The
court also identified the Account as the party that had been
“the beneficial owner” of the “note
interest” bought back by Plaintiff. Id. The
court, accordingly, entered a default judgment ordering the
Account to pay Plaintiff $422, 296.03 plus interest.
Id. at 16; Am. Compl., ¶ 14. The Fund,
conversely, was not mentioned in the court's order.
See Icelandic Judgment at 16 (omitting Fund, as
defendant of last resort, from “ADJUDICATION”
then filed this diversity action to enforce the Icelandic
Judgment under the District of Columbia's Uniform
Foreign-Country Money Judgments Recognition Act. See
Am. Compl., ¶ 3; Yahoo! Inc. v. La Ligue Contre Le
Racisme Et L'Antisemitisme, 433 F.3d 1199, 1212 (9th
Cir. 2006) (en banc) (“In diversity cases,
enforceability of judgments of courts of other countries is
generally governed by the law of the state in which
enforcement is sought.”) (citation omitted). The
Amended Complaint names the Account, the Fund, and the
individual members of the Fund's Board of Trustees as
Defendants. Id., ¶ 7. All Defendants now move
Rule of Civil Procedure 12(b)(6) permits a court to dismiss
any count of a complaint that fails “to state a claim
upon which relief can be granted.” In evaluating the
motion, a court must likewise “treat the
complaint's factual allegations as true and must grant
plaintiff ‘the benefit of all inferences that can be
derived from the facts alleged.'” Sparrow v.
United Air Lines, Inc., 216 F.3d 1111, 1113 (D.C. Cir.
2000) (quoting Schuler v. United States, 617 F.2d
605, 608 (D.C. Cir. 1979)) (internal citation omitted). The
court need not accept as true, however, “a legal
conclusion couched as a factual allegation” or an
inference unsupported by facts set forth in the Complaint.
Trudeau v. FTC, 456 F.3d 178, 193 (D.C. Cir. 2006)
(quoting Papasan v. Allain, 478 U.S. 265, 286
pleading standard is “not meant to impose a great
burden upon a plaintiff.” Dura Pharm., Inc. v.
Broudo, 544 U.S. 336, 347 (2005). While “detailed
factual allegations” are not necessary to withstand a
dismissal motion, Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007), the Complaint still “must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). In other words, a
plaintiff must put forth “factual content that allows
the court to draw the reasonable inference that the defendant
is liable for the misconduct alleged.” Id. A
complaint may survive even if “‘recovery is very
remote and unlikely'” or the veracity of the claims
are “doubtful in fact” if the factual matter
alleged in the complaint is “enough to raise a right to
relief above the speculative level.” Twombly,
550 U.S. at 555-56 (quoting Scheuer v. Rhodes, 416
U.S. 232, 236 (1974)).
evaluating the sufficiency of a complaint under Rule
12(b)(6), a court may consider “the facts alleged in
the complaint, any documents either attached to or
incorporated in the complaint[, ] and matters of which [the
court] may take judicial notice.” Equal Emp't
Opportunity Comm'n v. St. Francis Xavier Parochial
Sch., 117 F.3d 621, 624 (D.C. Cir. 1997). The court may
thus consider those materials on a motion to dismiss without
treating the motion “as one for summary judgment under
Rule 56.” Fed.R.Civ.P. 12(d); see also Marshall v.
Honeywell Tech. Solutions, Inc., 536 F.Supp.2d 59, 65-66