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10-04285-brl Doc 127 Filed 08/17/12 Entered 08/17/12 14:29:55 Main Document Pg 90 of 133 Access’s New York office. 31 Each of the other factors of the mere department test is also satisfied as to AIA Ltd., because of its lack of independent operations as well as its domination by Access’s New York office, without which AIA Ltd. would not have survived. See Van Egeraat, 2009 WL 1209020, at *2–4; Motown Record Co., L.P. v. iMesh.com, Inc., No. 03 Civ. 7339 (PKC), 2004 WL 503720, at *5 (S.D.N.Y. Mar. 12, 2004) (“Factually, the last three elements meld together in this case because the entities do not treat themselves as separate. The blur between [the parent and subsidiary] is pervasive.”). By serving as a financially dependent “money box,” and having no employees of its own to perform any of its purported duties, which were performed by other Access employees, AIA Ltd. was in fact a mere department of Access’s New York office. 6. AML Is Further Subject to Jurisdiction Because of Its Agency and Mere Department Relationships with Access’s New York Office AML is also subject to this Court’s jurisdiction because Access’s New York office acted as AML’s agent, and because of AML’s mere department relationship with Access’s New York office. Like AIA Ltd., AML had no employees of its own to conduct the activities it purported to perform on behalf of Luxalpha and Groupement. AML appears to have been a shell entity established in Luxembourg and subject to the control of majority owners Littaye and Villehuchet for the purpose of facilitating the administration of Luxalpha and Groupement. 32 To the extent 31 In May 2003, AIA Ltd. was 51% owned by EarthStreet (which was ultimately owned by Littaye) and 49% by AIA Inc. (which was ultimately owned by Littaye and Villehuchet). (Pergament Decl. Exs. 136; 139 at 2.) By 2005, AIA Ltd. was 45% owned by AIA Inc., 24% owned by Villehuchet, 24% owned by Pause Group (which was ultimately owned by Littaye through Dalestrong), and 7% owned by Access principal Philippe Junot. (Pergament Decl. Exs. 137; 139 at 2.) And according to Access’s July 2011 Corporate Ownership Statement filed in this proceeding, AIA Inc., Littaye-controlled entity Dalestrong, and Ms. Villehuchet each own a 33% interest in AIA Ltd. [S.D.N.Y. ECF No. 5.] Thus, at all relevant times, AIA Ltd. appears to have been at least 93% ultimately owned by Littaye and Villehuchet, satisfying the threshold common ownership prong of the mere department test. See, e.g., ESI, Inc., 61 F.Supp.2d at 52 (90% common ownership sufficient). 32 A September 2004 questionnaire states that AIA (Lux) has “no regular employees” and that the directors and/or officers carry out its responsibilities. (Pergament Decl. Ex. 152 at 7–8.) The areas of trading, research and development, IT/Programming, administration, marketing and business development are all “outsourced,” with only 70
10-04285-brl Doc 127 Filed 08/17/12 Entered 08/17/12 14:29:55 Main Document Pg 91 of 133 AML had any actual corporate duties or responsibilities, these were carried out by Access’s New York office (or AIA Europe’s London office at the direction of the New York office), such that the jurisdictional contacts of Access in New York should be imputed to AML. See Van Egeraat, 2009 WL 1209020, at *2–4; see also In re Nat’l Audit Def. Network, 332 B.R. at 905–06 (Bankr. D. Nev. 2005) (“[A foreign party] may not avoid jurisdiction in the United States by conveniently interposing a subsidiary between its acts and the debtor.”). AML is also subject to jurisdiction because it is a mere department of Access’s New York office. The threshold inquiry of common ownership is satisfied because AML was majority owned by Littaye and Villehuchet and, therefore, was owned by the same parties as Access’s New York office. 33 The other factors of the mere department test are similarly satisfied because AML was as an entity with no employees that nonetheless earned substantial fees from Luxalpha and Groupement in connection with investment services purportedly provided by AML to these funds. AML was able to earn such fees because it was dominated and controlled by, and financially dependent on, Access’s New York headquarters which operated AML and the other “reporting, performance analysis” performed by Litttaye and compliance performed by Delandmeter. (Id.) Likewise, another Access document notes that Access had offices and employees in New York, London, and Paris, but that “Luxembourg is only a legal entity.” (Pergament Decl. Ex. 105 at 13.) A 2008 contact list for various Access entities, including AML, shows only Littaye with a phone number associated with AML, and lists only Littaye and Delandmeter (who are both subject to the Court’s jurisdiction) with any Luxembourg contact information. (Pergament Decl. Ex. 109.) And numerous organizational charts prepared by Access reveal that the risk management functions that AML purported to perform were actually conducted by employees and directors of Access’s New York office. (See Pergament Decl. Exs. 153; 98 at 8; 154.) 33 From its inception as AIA (Lux) in 2003 through its renaming as “AML” in 2008, AML was ultimately majorityowned by Littaye and Villehuchet. When AIA (Lux) was formed in 2003, AIA Inc. owned 50% while AIA Europe owned 30%--each of which was ultimately owned by Littaye and Villehuchet. (Pergament Decl. Exs. 94 at 6; 136.) The remaining 20% was owned by Banque Degroof Luxembourg S.A. (“Banque Degroof”). (Pergament Decl. Ex. 94 at 6.) In February 2007, Littaye, Villehuchet, and Banque Degroof created the Luxembourg-based Access entity AP (Lux). (Pergament Decl. Ex. 96 at 1.) Littaye and Villehuchet each owned 40% of AP (Lux), and Banque Degroof owned the remaining 20%. (Id. at 7.) In March 2008, AP (Lux) purchased all of AIA Inc. and AIA Europe’s shares of AIA (Lux), thereby becoming the owner of 80% of AIA (Lux). (Pergament Decl. Ex. 155 at 1.) AP (Lux) maintained its eighty percent ownership of the company after AIA Lux changed its name to AML in August 2008. (Pergament Decl. Ex. 95 at 3.) And according to Access’s July 2011 Corporate Ownership Statement, AML is owned 40% by Littaye-controlled entity Dalestrong, 40% by Ms. Villehuchet, and 20% by Banque Degroof. [S.D.N.Y. ECF No. 5 at 3.] 71
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