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Teleservices Jamaica, Ltd. v. West Telemarketing Corp.
Citation: 206 F. App'x 35Docket: No. 05-6521-cv
Court: Court of Appeals for the Second Circuit; November 14, 2006; Federal Appellate Court
Teleservices Jamaica, Ltd. (TJL) appeals an amended judgment from the Southern District of New York, which dismissed its suit against West Telemarketing Corporation and West Corporation, along with an order denying its motion for reconsideration. Under Jamaican law, directors of a company in receivership cannot initiate lawsuits without the receiver's consent if such actions could threaten the assets under the receiver's control. Although TJL's counsel acknowledged the possibility of providing indemnity to the receivership for litigation costs, this was only mentioned in the motion for reconsideration, despite prior awareness of the law. The court found TJL's late and unsubstantiated claims inadequate to satisfy indemnity requirements, thus barring the lawsuit without the receiver's approval. TJL's argument against the need for indemnity based on the absence of a "loser pays" system in the U.S. was deemed unfounded, as U.S. courts can award costs and fees in certain contexts. Furthermore, TJL's assertion that there were no assets in the receivership to jeopardize was introduced too late in the reconsideration motion for consideration. The court clarified that the relevant inquiry pertains to whether the assets that may be endangered by litigation are within the receivership's charge, rather than the specific claims' nature. Consequently, the district court's judgment is affirmed, and the issue of whether TJL's authority to sue is a matter of capacity or standing is left unresolved. Ultimately, the burden of proving TJL's entitlement to bring the action rested on TJL, which the court agreed it failed to fulfill.