USA – NEW YORK Trends and Developments Contributed by: Alex Loomis and Gregg Badichek, Quinn Emanuel Urquhart & Sullivan, LLP
ognition” grounds apply to the underlying foreign judgment. For instance, under Article 53, courts can - not recognise judgments rendered by courts that are systemically unfair or by a court that lacked personal jurisdiction over the judgment debtor. By contrast, courts have discretion to deny recognition if the foreign court procedures failed to comply with due process, service was inadequate, the claim was against public policy, and so forth. As written, these nonrecognition grounds may seem capacious, but recent New York cases illustrate that, in fact, New York has a strong bias in favour of recognition that is hon - oured in both state and federal courts. In Trejos Hermanos Sucesores S.A. v Verizon Commc’ns Inc., No. 1:21-CV-08928 (JLR), 2024 WL 149551 (S.D.N.Y. Jan. 12, 2024), for exam - ple, the court recognised a USD50 million Costa Rican judgment and summarily rejected numer - ous challenges that Verizon had raised because they had been litigated in Costa Rica. When a foreign court hears the same argument and rejects it as a matter of law, the court concluded, that same ground cannot be raised in the United States as a nonrecognition ground. Similarly, Tianzhu Coal Co. v Ju, 83 Misc. 3d 1270(A), 2024 WL 3869799 (Nassau Sup. Ct. Aug. 12, 2024), ruled that a defendant could not argue that a Chinese judgment was fraudulently procured unless he proved that the alleged fraud deprived him of the opportunity to present his case. Liu v Guan, 225 A.D.3d 749 (2d Dep’t 2024), in turn, illustrated how difficult it is to prove that a foreign country’s judicial system is systemi - cally unfair. The defendant argued against rec - ognition of a Chinese judgment arising out of a
breached loan agreement by contending, based on US State Department Human Rights Reports, that Chinese courts are systemically unfair. The court rejected that argument out of hand, finding that such human rights reports are not sufficient proof that courts are systemically unfair in com - mercial cases. Other cases made clear that CPLR Article 53’s grounds for nonrecognition of foreign judgments are exclusive, and declined to dismiss for lack of jurisdiction. In Williams v Fed. Gov’t of Nigeria, No. 23-CV-7356, 2024 WL 3759649 (S.D.N.Y. Aug. 12, 2024), for example, the court ruled that a foreign country judgment recognition act cannot, as a matter of law, be dismissed based on forum non conveniens. This takes away a powerful argument that judgment debtors often make to resist recognition and enforcement in New York of foreign judgments that lack any US nexus. More significant, however, is Cargill Fin. Servs. Int’l, Inc. v Barshchovskiy, No. 24-CV-5751 (LJL), 2025 WL 522108 (S.D.N.Y. Feb. 18, 2025). Cargill ruled that, so long as the judgment debtor has no colourable defences to recognition, a federal court can recognise a foreign country judgment even if it lacks personal jurisdiction over the judgment debtor. Cargill relied on New York state cases that had developed this line of precedent over the last few decades. But this appears to be the first time a New York federal court has embraced this doctrine. It presents numerous opportunities for judgment creditors to domesticate fully litigated judgments from well-respected foreign jurisdic - tions, like the UK and France, to obtain post- judgment discovery which then can be used for enforcement efforts around the world.
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