Matimak Trading Co v Khalily & D.A.Y. Kids Sportswear: Prepare a Case Brief

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Matimak Trading Company v. Khalily
118 F.3d 76 (2d Cir. 1997).
Facts: Plaintiff Matimak Trading Co. Ltd. was a corporation organized under the laws of Hong Kong, with its principal place of business in Hong Kong. It seeks to sue Albert Khalily and D.A.Y. Kids Sportswear Inc., New York defendants, for breach of contract. Matimak claimed jurisdiction under the diversity clause of 28 U.S.C. § 1332(a)(2), which provides jurisdiction over any civil action arising between "citizens of a State and citizens or subjects of a foreign state."

The district court dismissed the Complaint for lack of subject matter jurisdiction, and subsequently affirmed in the Court of Appeals. The court concluded that Hong Kong is not a "foreign state" under the diversity statute, and Matimak is not a "citizen or subject" of a "foreign state."
Procedure: Plaintiff appealed from the district court's 1996 dismissal of their Complaint based on the lack of subject matter jurisdiction. The Court of Appeals, Second Circuit affirmed the district court's dismissal in 1997 holding that Hong Kong could not be regarded as a "foreign state". Certiorari to the US Supreme Court was denied in January 1998.
Issue(s): Can Hong Kong be regarded as a foreign state, thereby affording its citizens "alienage jurisdiction" meeting the requirements to bring a civil action in the United States?
Holding: NO
Reasoning: Article III of the Constitution extends the federal judicial power to "all Cases ... between a State, or citizens thereof, and foreign States, Citizens or Subjects." U.S. Const. art. III, § 2, cl. 1. The US courts provide diversity jurisdiction ...