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Rosenbloom v. Barclays Bank Plc

United States District Court, N.D. Illinois, Eastern Division

June 16, 2014



ANDREA R. WOOD, District Judge.

Plaintiff Lewis Rosenbloom is a former partner at the now-defunct international law firm Dewey & LeBoeuf, LLP ("Dewey"). On June 2, 2013, Rosenbloom filed suit in this Court alleging that Defendant Barclays Bank PLC ("Barclays") conspired with Dewey's management to fraudulently induce Rosenbloom to enter into a loan in connection with Rosenbloom's retirement from Dewey. On August 23, 2013, Barclays filed its own lawsuit in London, England to enforce the terms of the loan (the "English Action"). Rosenbloom has now filed in this Court a Motion for Preliminary Antisuit Injunction (Dkt. No. 32) (the "Motion") seeking to enjoin Barclays from further litigating the English Action. For the reasons explained below, the Court denies Rosenbloom's Motion.


In May 2007, Rosenbloom executed a loan agreement with Barclays under which he was to receive $720, 000 (the "Loan Agreement"). (Sec. Am. Compl. Ex. C, Dkt. No. 43-3.) The loan was made in connection with Rosenbloom's contemplated withdrawal from the Dewey partnership and his transition to "of counsel" status. At the time, Rosenbloom had approximately $700, 000 in his firm capital account and, under the Dewey Partnership Agreement, that amount would be returned to Rosenbloom in installments over three years after his departure from the Dewey partnership. (Shaw Decl. Exs. 7, 8 at § 7.6(a)(i), Dkt. No. 37.) It appears that Dewey offered to advance Rosenbloom the money immediately if he took out a loan from Barclays to fund his capital account. Dewey would then assume the Loan Agreement and return Rosenbloom's capital by repaying the loan. ( Id. Exs. 3, 4, 6.)

The Loan Agreement includes several provisions that purport to establish the "Governing Law." One such provision, Section 11.1, provides that the Loan Agreement will be "governed by and construed in accordance with the laws of England." (Sec. Am. Compl. Ex. C at § 11.1, Dkt. No. 43-3.) Another provision, Section 11.2, states:

In the event that the Bank files an action before the English courts to enforce the terms of the Loan, the Borrower hereby irrevocably submits to the personal jurisdiction of the English courts, and irrevocably waives any objection to such jurisdiction or inconvenient forum.

( Id. at § 11.2.) The Loan Agreement also contains a clause that requires Rosenbloom to "indemnify [Barclays] on demand against any loss, liability, cost or expense that the Bank may reasonably incur as a consequence of making [a] demand [of repayment]...." ( Id. at § 10.4.)

On July 13, 2009, Rosenbloom left the Dewey partnership and became "of counsel" with the firm. (Shaw Decl. Ex. 6, Dkt. No. 37.) After Rosenbloom's departure, Dewey suffered a series of financial setbacks and ultimately entered Chapter 11 bankruptcy in May 2012. Barclays subsequently looked to Rosenbloom to satisfy the remaining obligation under the Loan Agreement. After negotiations between the parties fell apart, Rosenbloom filed this action in June 2013, alleging, inter alia, that Barclays and Dewey had conspired to defraud him by means of the Loan Agreement.

In July 2013, Barclays sent a formal demand letter informing Rosenbloom that he was in default of the outstanding loan amount of $676, 800.00. (Rajagopal Decl. Ex. 1, Dkt. No. 34-1.) On August 13, 2013, Barclays's English counsel sent a letter (the "August 2013 Letter") to notify Rosenbloom that, unless the outstanding sums under the Loan Agreement were paid within seven days, Barclays would file suit in England. (Rajagopal Decl. Ex. 2, Dkt. No. 34-2.) The letter explicitly cited Section 11.2 and noted that by filing suit in U.S. District Court, Rosenbloom had "exposed him[self] to the very real risk of parallel litigation proceedings." ( Id. ) The letter also warned that Rosenbloom would be required to indemnify Barclays for its litigation costs pursuant to Section 10.4 of the Loan Agreement. ( Id. ) Further attempts to resolve the dispute were fruitless and, on August 23, 2013, Barclays filed the English Action against Rosenbloom. (Rajagopal Decl. ¶ 10, Dkt. No. 34.)

Shortly after Barclays filed the English Action, Rosenbloom filed a motion for a preliminary injunction in this Court, seeking to enjoin any prosecution of the English Action. Rosenbloom withdrew the motion without prejudice after the parties agreed to stay this case, as well as the English Action, in order to obtain informal discovery from the Dewey bankruptcy estate and engage in settlement discussions. After receiving written discovery from the Dewey estate, however, settlement talks between the parties broke down. With the agreement of the parties, the Court lifted the stay on March 12, 2014. Shortly thereafter, Plaintiff filed the instant Motion.


Generally, a party seeking a preliminary injunction must show: (1) some likelihood of success on the merits; (2) no adequate remedy at law; and (3) irreparable harm to the movant if the relief is not granted. Promatek Indus., Ltd. v. Equitrac Corp., 300 F.3d 808, 811 (7th Cir. 2002). It is well-established that a federal court may enjoin a party subject to its jurisdiction from litigating in another country. See Allendale Mut. Ins. Co. v. Bull Data Sys., Inc., 10 F.3d 425, 431 (7th Cir. 1993); see also Goss Int'l Corp. v. Man Roland Druckmaschinen Aktiengesellschaft, 491 F.3d 355, 360 (8th Cir. 2007); Paramedics Electromedicina Comercial, Ltda. v. GE Med. Sys. Info. Techs., Inc., 369 F.3d 645, 652 (2d Cir. 2004). But there is a Circuit split regarding how the standard for preliminary injunctions should be applied in the context of foreign antisuit injunctions.

Under the more "conservative" approach adopted by the First, Second, Third, Sixth, and District of Columbia Circuits, a district court may issue a foreign antisuit injunction only if the movant demonstrates that "(1) an action in a foreign jurisdiction would prevent United States jurisdiction or threaten a vital United States policy, and (2) the domestic interests outweigh concerns of international comity." Zimnicki v. Neo-Neon Int'l, Ltd., No. 06 C 4879, 2009 WL 2392065, at *2 (N.D. Ill. July 30, 2009) (citing Goss Int'l Corp., 491 F.3d at 359). In contrast, the Fifth and Ninth Circuits follow a more "liberal" or lax approach that places less emphasis on international comity and approves the issuance of an antisuit injunction "when necessary to prevent duplicative and vexatious foreign litigation and to avoid inconsistent judgments." Id. While the Seventh Circuit has not yet planted its flag firmly in one camp or the other, it has expressed an inclination toward the laxer standard. See Allendale, 10 F.3d at 431.

To obtain an antisuit injunction in this Circuit, the movant must first establish that the parties and issues in both proceedings are the same, and the resolution of the first action would be dispositive of the action to be enjoined. Zimnicki, 2009 WL 2392065, at *2. Additionally, the movant must demonstrate that the balance of domestic interests, such as the prevention of vexatious, harassing, or oppressive litigation, outweighs concerns regarding international comity. Allendale, 10 F.3d 431-32. In this case, the parties do not dispute that the parties and issues are the same for both actions and that the resolution of the case in this Court would be ...

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