1

05-2378-cv Koehler v. Bank of Bermuda Ltd. U N IT E D S T A T E S C O U R T O F A P P E A LS F O R T H E S E C O N D C IR C U IT

_______________________________ August Term, 2007 (Argued: Fe bruar

y 29, 2008 Dec ided: September 23, 2008)

Docke t No. 05-2378-c v

_______________________________ L EE N. KOE HL ER, Pe tit ion e r- Ap pe lla nt, v. THE B ANK OF BERMUDAL I MI TED, Respondent-Appe llee.

_______________________________ Be fore : CABRANES, POOL ER, and KATZ MANN, Circuit Judges.

_______________________________ L ee N . Koehler

appea ls from two order s of the United States District Court for the Southern District of Ne w York ( Charles S. Haight, J r., Judge) : a Marc h 9, 2005 memorandum op ini on and or de r a nd an Augus t 10 , 2 00 5 me mor and um o pin ion

and or de r, ins of

ar a s th os e order s vacated an Oc tober 29, 1993 orde r for pay ment or deliver

y of prope rty

of the judg ment debtor, he ld that Koehler

could not rea ch an a ccommodation with the judg ment debtor a nd continue to pursue his a ction ag ainst The B ank of B ermuda L imited (“B BL ”), a

nd denied
rec onsideration of those issues. We hold that the district cour t erre d in ruling that the Mary land settlement exti nguished Koehle r’s a ction ag ainst BB L . We cer tify to the New Y ork State Court2

of Ap pe a ls the qu e sti on

of wh e the r a

c ourt sittin gin N e w Y or

k ma y or de r a ba nk ov e r whic h it has per sonal jurisdiction to deliver stock ce rtificate s owned by a judg ment debtor (or

cash e qual to their value) to a judg ment cre ditor, pursuant to N.Y. C.P.L .R. Article 52, whe n those stock
cer tificates a re loc ated outside Ne w York. VA CA TE D i n p art . Q ue sti on CER TI F I ED to t

he Ne w Y or

k St ate Court

of Ap pe a ls.

__________________________

BRIAN G. WEST, Towson, MD (Paul F. N ewhouse , on the brief ) for Pe tit ion e r- Ap pe lla

nt, DANI ELB. RAPPORT, Frie dman Kapla n Seiler & Adelman L L P, New Yor k, NY (Rober

t J . L ack, V anessa

Richards, on the brief) f

or Respondent-A

ppellee.

__________________________ POOL ER, Circuit J udg e: L ee N . Koehler

appea ls from two order s of the United States District Court for the Southern District of Ne w York ( Charles S. Haight, J r., Judge) , a Mar ch 9, 2005 memora ndum op ini on and or de r a nd an Augus t 10 , 2 00 5 me mor and um o pin ion

and or de r, ins of

ar a s th os e order s vacated an Oc tober 29, 1993 orde r for pay ment or deliver

y of prope rty

of the judg ment debtor, he ld that Koehler

could not rea ch an a ccommodation with the judg ment debtor a nd continue to pursue his a ction ag ainst The B ank of B ermuda L imited (“B BL ”), a

nd denied
rec onsideration of those issues. The district court conc luded that Koehle r’s July 2004 settlement ag ree ment had extinguished his claims ag ainst BB L , and that in any event, the district c ourt lacke d in rem jurisdiction over stock c ertificates held in Be rmuda. We hold that the district court err ed in conc luding that the se ttlement ag ree mentDodwell moved to vac ate the judg ment for lac k of per sonal jurisdiction. The United 1 States District Court for the District of Ma ryland held that ser

vice upon Dodw ell had bee n ine ff e c tiv e , a nd va c ate d th e jud g me nt. Th e F ourt h Ci rc uit , h ow e ve r, re ve rs e d th e Di str ic t Co ur t, Koehler v. Dodwell, 152 F .3d 304 (4th Cir. 1998), and Koe hler’s judg ment ag ainst Dodwell wa s reinstated. 3 e xtinguis he d K oe hle r’ s a c tio n a g a ins t th e ba nk . Wh e the r t

he dis tr ic t c ourt

ne ve rt he le ss c or re c tly denied Koe hler’s pe tition for a writ of e x ecution, on the ground that it lacke d in rem jurisdiction, depends on whether

a cour t in New Yor

k may , pursuant to N.Y. C.P.L .R. 5225(b) or N.Y
. C.P.L .R. 5227, order a

bank over

which it has per sonal jurisdiction to deliver stock ce rtificate s owne d b y a jud g me nt d e bto r ( or

c a she qu a l to the ir

va lue ) t o a

jud g me nt c re dit or , p ur su ant t o N. Y. C.P. L .R. Ar

tic le 52 , whe n th os e sto c k c e rt if ic ate s a re loc ate d o uts ide Ne w Y or k. B e c a us e thi s q ue sti on ha s n ot b e e n d ir e c tly

a dd re sse d b y the Ne w Y or

k St ate Court

of Ap pe a ls a

nd is
c ontr oll ingin t

he dis po sit ion

of Ko e hle r’ s p e tit ion , w e c e rt if y the qu e sti on

to t he Ne w Y or

k St ate Court of Appea ls. W e re tain jurisdiction over the c ase a nd will decide the a

ppeal a fter w e have lear ned the view s of the Ne w York State Court of A ppeals or that court dec lines cer tification. B ACKG ROUND On J une 4, 1993, the United States D istrict Court for the District of Ma ryland awa

rded Koehler a $2,096,343 def

ault judgme nt ag ainst A. David Dodw ell. Koehler reg istered the 1 judgme nt in the United States District Court for the Southern District of New Y ork on Jul y

23, 1993, pursuant to 28 U.S.C. § 1963. Dodwell, a re sident of B ermuda , owned stock in a Be rmuda corpor ation, The Ree fs B eac h Club L imited (“The Re efs” ). It is undisput ed that the stock
cer tificates r epre sentingDodwell’s sha res in The Reefs w ere alway s located in B ermuda . On the
un ders tan di ng th at BBLpo ss ess ed t he certi fi cat es, whi ch D odwel l h ad i ni ti all y pl edged t o BBL as collate ral for

a loan, Koe hler be g an g arnishment proc eeding s ag ainst BB L .I t appea rs that Koehle r did not inform the district court at this t ime that the ce rtificate s 2 wer e located in Be rmuda. See Koehler v. Ba nk of B ermuda , L td., 2005 U.S. Dist. L EXI S 16521, at *4, 2005 WL1924746, at *2 (S.D.N.Y. Aug . 10, 2005). 4 On J uly 26, 1993 and August 10, 1993, Koehler se rved, on a New Y ork subsidiary

of BB L , a wr it of execution, under N.Y. C.P.L .R. 5232(a), a nd a re strainingnotice, which c ited Fe d. R. Civ. P . 69(a) and N.Y. C.P.L .R. 5222(b). On Oc tober 27, 1993, Koe hler filed a “motion for pay ment or deliver

y of prope rty

of judg ment debtor.” In that petition, Koehler c laimed that if the stock ce rtificate s no longe r re prese nted sec urity for B BL ’s loan to Dodwe ll, then either they wer e capa ble of de livery

by BB Lunder N .Y. C.P.L .R. 5225 or they repr esente d a debt to Dodwe ll and their value should be paid by BB Lto Koehler

under N .Y. C.P.L .R. 5227. On October 29, 1993, the United States District Court for the Southern District of Ne w York ( Robert J . Ward, J udg e) signe d, ex parte, an or der to show c ause why BB Lshould not be order ed to deliver proper ty or pay over a debt owed to Dodw ell and an “ order for pa y ment or deliver

y of prope rty

of the judgme nt debtor,” which re quired B BL to deliver to Koe hler a

ny stock ce rtificate s owned by Dodwell or to pa

y to Koehler

any debt owed to Dodw ell, up to the sum of $2,096,343. 2 BB Lthen cha lleng ed the district cour t’s persona l jurisdiction over it, an issue that the parties pr ocee ded to litigate for the ne x t ten y ear s. See, e.g ., Koehler v. Ba nk of B ermuda , L td., No. M18-302, 1994 U.S. Dist. L EXI S 1540, 1994 W L48825 (S.D.N.Y. F eb. 16, 1994); Koe hler
v . B an k o f B e r mu d a , L td
. , N o . M 1 8
- 3 0 2 ( CS H ) , 1 9 9 5 U . S. D is t. L E X I S 1 8 2 2 3 , 1 9 9 5 WL 728467 (S.D.N.Y. De c. 8, 1995); Koe hler v. B ank of B ermuda , L td., 101 F.3d 863 (2d Cir. 1996); Koehle r v. B ank of B ermuda , L td., No. M18-302, 1997 WL370791 (S.D.N.Y. July 2, 1 9 9 7 ) ; K o e h le r

v . B an k o f B e r mu d a , L td
. , N o . M 1 8
- 3 0 2 , 2 0 0 3 U . S. D is t. L E X I S 1 9 4 6 , 2 0 0 3 WL 2 8 9 6 4 0 ( S
. D . N . Y . F e b
. 1 1 , 2 0 0 3 )
. M a g i s tr at e J u d g e M i c h a e l H . D o l i n g e r f o un d th atB B L,5

“ wh e the r t

hr ou g h d e lib e rate de c isi on or e xtre me ind if

fe re nc e to i ts o bli g atio ns , f a ile d to c omp ly
over a n extended period of time both with its discovery obligations and with specific r ulings of [t he district] court.” Koe hler, 2003 U.S. Dist. L EXI S 1946, at *20-21, 2003 WL289640 at *7. Eventually , in October

2003, BB Lconsente d to the persona l jurisdiction of the Southern District of Ne w York ove r it, as of the c ommenceme nt of the proc eedingten y ear s ear lier. In Marc h 2004, the district court orde red B BL to file an a ffidavit conc erningthe pre sent loc atio n, owne rs hip , a

nd dis po sit ion

of the sh are s in

Th e Re e fs owne d b y

Do dw e ll at th e tim e Koehler commence d his action. Koehle r v. B ank of B ermuda , L td., No. M18-302 (CSH), 2004 U. S. D ist . L EX I S 37 72 , at *6 4, 20 04 WL44 41 01 , at *2 1 ( S.D .N .Y . M ar. 10 , 2 00 4) . In Apr il 2004, BB Linformed Koe hler a nd the cour

t that it was no longe r in possession of Dodwe ll’s stock ce rtificate s. The oblig ations for whic h BB Lhad held the c ertificates as collate ral ha d been satisfied in 1993 and B BL (ig noringJ udg e Ward’s turnove r orde r) ha d transfe rre d the stock to a Be rmudan c ompany

that exis ted for D odwell’s bene fit in J uly 1994. In the meantime, howe ver, K oehler initiated ga

rnishment proce eding s ag ainst The Ree fs and a B ritish W est Indies corpor ation, Windward Properties L imited (“Windward”) , in which Dodwell owne d stock, in the United States District Court for the D istrict of Mary land. Koehle r ha d a lso a sse rt e d s e pa

rate c la ims a g a ins t D od

we ll a nd Th e Re e fs in s tate c ourt

– th e Cir c uit Court for B altimore County , Maryland. In J uly 2004, in the course of the District of Ma ryland proce eding s, Koehler

enter ed into a settlement with Windward, Dodwe ll, and The Ree fs. Koehler ag ree d to be paid $475,000, of which he a sserts that $75,000 was to be cre dited to the defa ult judgment, and $400,000 to his cla ims ag ainst The Ree fs and Dodw ell in the action pendingin Maryland state c ourt. In return, he ag ree d not to sue Dodwell for enfor ceme nt of the6

defa ult judgment. The parties sig ned the se ttlement ag ree ment on J uly 12, 2004, followed by

an addendum a

nd a g ener al re lease on J uly 13, 2004. In Marc h 2005, the United States District Court for the Southern District of Ne w Yo rk (C ha rl e s S. Ha ig ht, Jr., Judg e ), de nie d K oe hle r’ s p e tit ion fo r wri t of

e xec uti on

and his reque st to amend the petition to include claims of ne g lige nce, f raudule nt conveyance , fra udulent
conce alment, and ne g lige nt misreprese ntation, and dismissed his procee dings w ith prejudice. K o e h le r v . B an k o f B e r mu d a , L td
. , N o . M 1 8
- 3 0 2 ( CS H ) , 2 0 0 5 U . S. D is t. L E X I S 3 7 6 0 , 2 0 0 5 WL 551115 (S.D.N.Y. Mar ch 9, 2005). The district court conc luded “that the se ttlement betwee n Ko e hle r a nd Do dw e ll d isc ha

rg e s any ri g hts Ko e hle r m ay

have ha d to purs ue c la ims a g a ins t BB L ,” 2005 U.S. Dist. L EXI S 3760, at *20, 2005 WL551115, at *7, and that in any event it had “no in re m jurisdiction over Dodwe ll’s share c ertificates, which unde rlies Koehle r’s re maining claims ag ainst BB L ,” 2005 U.S. Dist. L EXI S 3760, at *21, 2005 WL551115, at *7. The district court subseque ntly

denied Koe hler’s motion for r econside ration. Koe hler v. B ank of B ermuda , L td., No. M18-302 (CSH), 2005 U.S. Dist. L EXI S 16521, 2005 W L1924746 (S.D.N.Y. Aug . 10, 20 05 ). Ko e hle r a

pp e a ls b oth

or de rs . The orde rs under

appea l effe ctively

vacated the Oc tober 29, 1993 turnove r orde r. Be cause an orde r re quiringsecur ities to be broug ht into New York f rom another

state or c ountry is treated a s an injunction, In re F eit & D rexler, Inc., 760 F .2d 406, 412 (2d Cir. 1985), Inter-Re g ional Financ ial Group, Inc. v. Ha shemi, 562 F.2d 152, 154 (2d Cir. 1977) , the orde rs un de r a pp e a l are re vie wa

ble a s “ int e rl oc uto ry

or de rs . . . d iss olv ing[an ] inj un c tio n[],” 28 U. S.C. § 1292(a) (1). We hold that the district court err ed in rulingthat the Mary land settlement extinguishedI sland Resorts Reservations L imited. 3 7 Koehler ’s ac tion ag ainst BB L , and we cer tify the question of its in rem jurisdiction to the New Yo rk State Court

of Ap pe a ls. DI SCU SSIO N

I. THE SETTL EMENT On J uly 12, 2004, attorney s for Koe hler, Dodw ell, The Ree fs, and Windward sig ned a settlement ag ree ment. Koehler ag ree d to be paid $475,000. In return, he rele ased the other pa rt ie s to the a g re e me nt f

ro m c la ims and

pr oc e e din g s. Paragraph 1.Aof the Settlement Agree ment specifie d that the “Rele asors” are “Koe hler
and his he ir s, pe rs on a l r e pr e se ntativ e s, and a ssi g ns ,” and

that th e “ Re le a se e s” are “ Do dw e ll, Re e fs , Win dw ard , I RR , a nd the ir re sp e c tiv e e mpl oye e s, dir e c tor s, of fi c e rs , r e pr e se ntativ e s, 3 ag ents, succe ssors, subsidiaries, af filiates, and attorney s.” The sa me par ag raph pr ovides that

“ ‘R e le a se e s’ sh a ll n ot i nc lud e the B OB Gr ou p . . . .” An

a dd e nd um t o th e Se ttl e me nt A g re e me nt, signe d the followingday , makes it clea r that “B OB ” re fer s to the Ba nk of B ermuda

Group, whic h

“ is d e fi ne d to me an T he B ank of B e rm ud a L imi te d, its of

fi c e rs , d ir e c tor s, atto rn e y s, a c c ounta nts , succe ssors, assig ns, aff

iliates, and/or ama lga

mation partner s.” Paragraph 2 of

the Settlement Ag ree ment require d Koehler as the Relea sor to g ive “[r]elease of

and fr om any

and all cla ims, actions, proce eding s, g arnishments, of a ny nature whatsoeve r ag ainst Release es, known or unknown, worldwide, f rom the beg inning of

time to the date of the re le a se , a

nd in t he futur e to t

he e xtent su c h c la ims or

pr oc e e din g s a

ri se out of

e ve nts
occur ringprior to the date of this Settlement Agr eeme nt, to the full ex tent permitted by law, except howeve r, that the re lease to Dodwell shall not in any way constitute a re lease of the8

De fa ult Judg me nt, no r i s it

int e nd e d in

any wa y [to] im pa ir or pr e jud ic e Ko e hle r’ s c la ims a g a ins t BoB in New Yor

k.” Para g raph 2.Aof the Settlement Agree ment provided a s follows. “Subject to # 5, Re le a so rs c ov e na

nt a nd a g re e : ( i) to r e fr a in f

ro m takin gany

a c tio n to c oll e c t, e xec ute upon, or enf

orce all or any

part of the Def

ault J udg ment ag ainst Dodwell or a g ainst any other person, e ntity , asset, or thing , with the exception that Releasor ma y pursue c laims ag ainst BOB
a s d isc us se d in

pa ra g ra ph5 b e low , a

nd (i i) he re a ft e r n ot t o r e c or d o r r e -r e c or d th e De fa ult J udg ment in any

judicial or g overnme ntal, public, or commer cial re cord a ny wher e in the wor ld, except as re quired to pursue the per mitted actions ag ainst BoB .” P ar agr ap h5 o f t h e S et t l em en tAgr ee m en tp ro v i d edth at“[ t ] h e R el ea s ee s ac kn o wl ed ge that there is curre ntly

pendingin United States District Court for the Southern District of New York a g arnishment proc eedingbetwee n Koehler and B OB . Nothing in this Settlement Ag ree ment shall be construe d so as to prohibit or prec lude or other wise limit Koehler fr om continuing to pr osecute such Ne w York a ction ag ainst the BO B G roup, or a dding c laims or
c a us e s o f a c tio n o r d e fe ns e s a g a ins t th e B OB Gr ou p th e re in, e xce pt h ow e ve r t hat K oe hle r s ha ll not seek, obtain, a ssume, acquir e by assig nment or oper ation of law or fac t, or exercise a

ny rig hts, claims or ca

uses of a ction which B OB has or may have a g ainst any

Release e now or

in the future.” In Paragraph 5A , the re lease es in turn re lease d Koehler “fr om any

exis ting or

future claim ar ising out of a

n asser tion by the B OB of a c laim ag ainst them for indemnity or dama g es as the re sult of Koehler

pursuingany

claim ag ainst BOB .” Un de r t he e xpre ss l angua g e of

the se ttl e me nt a g re e me nt, pa ra g ra ph10 , M ary

land law i s controlling . In Maryland, “[r]eleases a re c ontrac ts. There fore , they are construed a

nd applied
acc ordingto the rules of c ontrac t law. Moreove r, it is well settled that [a] rele ase is to be9

construed a ccor ding to the intent of the par ties and the objec t and purpose of the instrument, and that intent will control and limitits operation.” Ow ens-I llinois , Inc. v. Cook, 872 A.2d 969, 985 (Md. 2005) (inter

nal quotation marks and c itations omi tted); see a lso Shriver v. Carlin & Fulton Co., 141 A. 434, 440 (Md. 1928). F urthermor e, “[t]he parties to a re lease , absent leg islative restric tion, ordinarily

are fre e to expand or contra ct the scope of the instrument in ac corda nce wi th t he ir a g re e me nt. ” Mo rg a

n v . Co he n, 52 3 A .2 d 1 00 3, 10 09 (M d. 19 87 ) ( ho ldi ngthat r e le a se of or ig ina l to rt fe a so r d oe s n ot, of its e lf , p ro du c e le g a l r e su lt o f r e le a sin gc la ims a g a ins t subsequent neg lige ntly

treating phy sician, and that any Mary land dec isions to t he contr ary are overr uled). We ag ree with the district court that “the intent of the par ties clea rly appea rs from the fa c e of the a g re e me nt. . . . K oe hle r [m a de ] a c ov e na nt n ot t o s ue Do dw e ll t o e nf or c e the De fa

ult Judg me nt a g a ins t hi m, whil e ke e pin gthe jud g me nt i tse lf int a c t.” Ko e hle r, 20 05 U. S. D ist
. L EXI S 3760, at *9, WL551115, at *3. We also agree that “[o] rdinarily , a settlement be tween judgme nt cre ditor and judg ment debtor e liminates the rig ht of the judg ment cre ditor to pursue claims ag ainst a judg ment debtor’s g arnishee . . . beca use the settlement r emoves the unde rlying de bt u po n whic h th e jud g me nt c re dit or ’s c la im a g a ins t th e g arn ish e e is b a se d. ” I d. (e mph a sis added) . See B altimore & Ohio R.R. C o. v. Equitable B ank, N.A., 550 A .2d 407, 411-12 (Md. Ct. S pec. A

pp. 1988). We disag ree with the district court in that we c onclude that Koe hler wa s able to, and did, r eser

ve his rig hts ag ainst the g arnishee
. Th e se ttl e me nt a g re e me nt, at pa ra g ra ph2, e xpre ssl y

le ft the Di str ic t of

Ma ry land de fa ult judgme nt ag ainst Dodwell intact, a s the district court found. Mor eover , the languag e of the ag ree ment makes it plain that Koehle r intended to re serve his rights to sue B BL . The settlement10

ag ree ment provided that the r elea se would “not . . . in any way impair or pre

judice” K oehler ’s claims ag ainst BB Lin the Southern District of Ne w York a nd that it shall not be construed “ so as to prohibit or prec lude or other wise limit Koehler fr om continuing to prose cute” the ac tion ag ainst BB L . In fac t, under the G ener al Relea se sig ned on Jul y 13, 2004, the settlement and rele ase e x pressly

allow for the possibili ty

that BB Lwill pursue a c laim ag ainst Dodwell, ar ising fr om K oe hle r’ s a c tio n a g a ins t B B L . F ina lly , D od we ll e xpre ssl y

a c kn ow le dg e d h is p os sib le fu ture ri s k

o f l i ab i l i ty

t o BBL fo r i n d em n i ty

o r d am age s as th e r es u l to f K o eh l er ’s p urs u i n g a c l a i ma g a i n s tB B L. Acc ording ly , it is clear that the intent of the par ties was that Koe hler would no long er sue Dodwell dire ctly

to enforc e the judg ment ag ainst him but would continue lit iga tion ag ainst BB L . BB Largues that, bec ause of its status as a g arnishee rathe r than a surety , the settlement
a g re e me nt d oe s n ot f

it c omf or ta bly wi thi n th e ambi t of

Ma ry land ’s “ re se rv atio n o f r ig hts ” do c tr ine . Se e Chi c a g o T itl e Ins . Co . v . L umb e rm e n’ s Mut. C a s. Co. , 7 07 A. 2d 91 3, 92 1 ( Md . Ct
. Spec. App. 1998) ; see a lso Fede ral L and B ank, Inc. v. Esham, 406 A.2d 928, 940 ( Md. Ct. S pec. App. 1979). We disag ree . W h i l e C h i c a g o T i t l e i s s p e c i f i c a l l y c o n c e r

n e d w i thr e s e r

v at i o no f r i g h t s a g a i n s ta

s ur e ty, it d oe s n ot h old

that r e se rv atio n o f r ig hts is l imi te d to sure tie s. Ind e e d, Chi c a g o T itl e e xten ds to sureties a g ener al principle pr eviously applicable to judgment de btors, namely that “[a] right ag ainst other debtor s is held to be rese rved in a ny case wher e it appea

rs from the te rms of the
re l ea s e t h ati twa s n o ti n t en d edo r e x p ec t edth atal l th e d eb t o rs s h o u l d b e r el ea s ed
. ” C h i ca go Ti tle , 7 07 A. 2d

at 92 0- 21 (q

uo tin gRoe v. Citi zen s N atio na l B ank , 3 58 A. 2d 26 7, 27 0 ( Md . Ct
. Spec. App. 1976) , in turn quoting Willi ston on Contracts § 338). The Chica g o Title court tra ced11

this principle to Shriver v. Carlin & Fulton Co., 141 A. 434, 440 (Md. 1928) ( stating that “a rele ase is to be c onstrued ac cordingto the intent of the par ties and the objec t and purpose of the instrument, and that intent will control and limit i ts operation. He nce the leg al oper ation of a rele ase of one of two or

more joint debtors may

be re strained by

an express provision in the instrument that it shall notoperate as to the other .”). BB Lpoints to no Maryland ca se standingfor the pr oposition t hat a judgment cre ditor may not settle with a judg ment debtor while r eser ving r ights a g ainst a name d g arnishee . And the re is n o r e a so n to su

pp os e that th e g e ne ra l pr inc ipl e that a c re dit or may re se rv e his ri g hts
a g a ins t on e pa

rt y wh ile re le a sin gano the r, wh ic h h a s b e e n a pp lie d to mul tip le jud g me nt d e bto rs , see Shriver , 141 A. at 440, sure ties, see Chica g o Title, 707 A.2d at 920-21, a nd succe ssive tortfea sors, see Mor g an, 523 A.2d at 1009, is inapplicable to g arnishee s. The district cour

t ruling, a s it stands, makes a re lease encompa ss, by operation of law, parties spe cifica lly

excluded by

the re lease . That is not the law in Mary land. We conclude that the district court e rre d in ruling that the Maryland settlement extinguished Koe hler’s a ction ag ainst BB L . Ko e hle r’ s mo tio n to c e rt if y qu e sti on s o f l oc a l la

w t o th e Ma

ry land Court of Ap pe a ls i s de nie d a s mo ot. II. IN REM J URI SDI CTI ON A. Authority

under N ew Yor

k Civil Practice L aw a

nd Rules Under Fe dera l Rule of Civil Procedur e 69(a), a district c ourt has the a uthority to enforc e a judgme nt by

attachingproper

ty in acc ordanc e with the law of the state in which the district court sits. I n New Y ork, that law is the Ne w York Civil Practice L aw a nd Rules. Section 5225The district cour t held that the B ermuda

stock ce rtificate s sought by Koehler wer e not 4 leviable in Ne w York, a s proper ty ag ainst which a mone y

judgme nt may

be enf orce d, under N .Y. C.P.L .R. § 5201(b). 2005 U.S. Dist. L EXI S 3760, at *21-28, 2005 WL551115, at *8-10. And the district court he ld that the stock ce rtificate s did not fit withi n the N.Y. C.P.L .R. § 5 20 1( a ) d e fi nit ion

of de bts a g a ins t w hic h a

mon e y jud g me nt m ay

be e nf or c e d. 20 05 U. S. D ist
. L EXI S 3760, at *28-31, 2005 WL551115, at *10-11. B ut the district court did not hold that the sto c k c e rt if

ic ate s f a ile d to fi t w ith in t

he N. Y. C.P. L .R. § 5 20 1( b) de fi nit ion of pr op e rt y a g a ins t which a mone y

judgme nt may

be enf orce d. 12 a uth or ize s a

c ourt to o rd e r t he de liv e ry

of pr op e rt y that be lon g s to a

jud g me nt d e bto r b ut i s n ot i n his possession. N.Y. C.P.L .R. 5225(b). A similar proc eedingis available when a de bt is sought from a pe rson who is or will be indebted to the judg ment debtor. N.Y . C.P.L .R. 5227. Koehler inv ok e d b oth

pr ov isi on s in

his Oc tob e r 1 99 3 p e tit ion . We a ssume , w ith out de c idi ngat th is jun c tur e , th at th e sto c k K oe hle r s ou g ht w a s p ro pe rt y of Do dw e ll that w ou ld b e su bje c t to judgme nt enforc ement, under N.Y. C.P.L .R. 5201, were it located within New Y ork. 4 In vacating the 1993 tur

nover or der, the district court re lied on what it perc eived to be the well-e stablished principle that it could not attac h proper ty that is not withi n its jurisdi ction. 2005 U.S. Dist. L EXI S 3760, at *32, 2005 WL551115, at *11. The c ases it cites a re F iduciary Partners, Inc. v. Philippine Ex port & For eig n L oan Gua ranty Corp., 921 F. Supp. 1113, 1119-21 (S.D.N.Y. 1996) ( stating that property soug ht to be levied ag ainst by writ of execution under N.Y. C.P.L .R. 5232 must ex ist withi n the cour t’s jurisdiction); National Union Fire Ins. Co. v. Advanc ed Employ

ment Concepts, Inc., 703 N.Y.S.2d 3, 4 (N .Y. App. Div. 1st Dep’ t 2000) (holdingthat, “[i] n order

to be subject to attac hment, proper ty must be within the court’s jurisdiction”); Interc ontinental Credit Corp. v. Roth, 578 N.Y.S.2d 955, 956 (N.Y. Sup. Ct. 1990) (notingthat “a N ew Yor

k court c annot attac h proper ty not within it s jurisdiction”), vac ated on other grounds, 595 N.Y.S.2d 602 (N.Y . Sup. Ct . 1991); and Ga vilanes v. Matavosia

n, 47513

N.Y.S.2d 987, 989 (N.Y. Civ. Ct. 1984) (statingthat “[i] t is well established that a Ne w York court c annot attac h proper ty not within it s jurisdiction”). See a lso Mones v. Commer. Ba nk of Kuwa it, S.A .K ., 39 9 F . Su pp . 2 d 3 10 , 3 17 (S .D .N .Y . 2 00 5) (s tatin gthat “ [c]o ur ts h ave re pe ate dly he ld .
. . that [N. Y. C.P. L .R. 52 25 ] pow e r i s li mit e d to or de ri ngthe de liv e ry of pr op e rt y that is located w ithin the court’s jurisdiction.”), va cate d on other grounds, 204 Fe d. Appx. 988 (2d Ci r. 2006). I t seems clea

r that a c ourt sitting in New Y ork, that has pe rsonal jurisdiction over a judgme nt debtor, may

order the judg ment debtor himself to deliver proper ty into New Yor

k. See, e.g ., Gry phon Domestic VI , L L C v. APP Int’l. Fin. Co., B.V ., 836 N.Y.S.2d 4, 9 (N.Y. A pp. Div. 1st Dep’t 2007) ( holding that a court in Ne w York c an orde r a judg ment debtor, ove r whom it has p e r s o n a l j ur i s d i c t i o n , t o tur no v e r o u t - o f
- s t at e a s s e t s , un d e r

N . Y . C
. P . L. R . 5 2 2 5 ( a ) ) ; S t ar b ar e II Part ne rs , L .P. v. Slo an, 62 9 N .Y .S. 2d 23 (N .Y . App . D iv. 1s t D e p’ t 19 95 ) ( ho ldi ngthat a c ourt in New Y ork wa s entitled to order a judgme nt debtor to deliver a rtwork in his possession, under N.Y. C.P.L .R. 5225, although the artwor k was located outside new Y ork, bec ause it had pe rsonal jur isd ic tio n o ve r h im) . It is le ss c le ar t hat c ourt s h ave the a

uth or ity to o rd e r a

pe rs on or e nti ty oth e r t ha n th e jud g me nt d e bto r t o d e liv e r a sse ts i nto Ne w Y or k, wh e n th at pe rs on

or e nti ty is located in a

fore ign jur isdiction. Th e re le va

nt i nq uir y is whe the r Jud g e War d h a d th e a uth or ity to r e qu ir e a

ba nk in Be rmuda to turn over

Dodwell’s a ssets. Arguably , “ther e is no prec edent indicating that the court ha s this authority

over a financ ial intermediar

y .” Mones, 399 F . Supp. 2d at 318. Ho we ve r, B B Lha s c on se nte d to the dis tr ic t c ourt ’s pe rs on a l juri sd ic tio n o ve r i t, a nd it i s p os sib le to rea d New Y ork ca se law a s providing that a cour t may order any entity over which it has14

persona l jurisdiction to t urn over out-of-state proper

ty , reg ardle ss of whethe r that entity is the jud g me nt d e bto r. Se e Gr y ph on Do me sti c VI , 8 36 N. Y. S.2 d at 9 ( no tin gthat “ the e xplic it rationale [i n Starbare I IPartners, 629 N .Y.S.2d at 23] was that the court c ould order the defe ndant judg ment debtor to turn over proper ty beca use it had per sonal jurisdiction over the de fe nd ant” ); Mo rg e nth a

u v . A vio n Re so ur c e s Ltd. , 8 49 N. Y. S.2 d 2 23 , 2 26 (N .Y . App . D iv. 1s t De p’ t 20 07 ) ( e nd or sin gpla int if f’ s p os iti on

that “ the Ne w Y or

k c ourt s h ave the po we r t o command a g arnishee prese nt in the state to bringout-of-state assets under the g arnishee ’s control into the state”)
. I f t he pe rs on a l juri sd ic tio n th at a c ourt ha s o ve r a

jud g me nt d e bto r i s th e ke y to i ts a bil ity to force him to facilitate judg ment enfor ceme nt by bring ing his own pr operty into New Yor

k, then we se e no princ ipled rea son why a cour t in New Yor

k should not be able to orde r a g arnishee that has submitted to its persona l jurisdiction to deliver proper ty within its control. Although a

writ of execution, which is issuable to a N ew Yor k sheriff , cannot be levied outside New Y ork, we perc eive nothingin the textof N.Y. C.P.L .R. 5225 that would lim it the power of a court to orde r a pa

rty within its persona l jurisdiction to deliver proper ty to New Yor

k. Howeve r, we a cknowledg e that the issue is unsettled in New York, a nd that it mustbe re solved by the New Yo rk State Court

of Ap pe a ls, be fo re we c an d e te rm ine wh e the r t he dis tr ic t c ourt

c or re c tly
vacated the turnove r orde r. We are also mindful that, even if “ [s] hare s of stock ar e intang ible proper ty . . . y et for prac tical purposes the y

are merg ed in stock ce rtificate s.” Ag ar v. O rda, 190 N .E. 479, 480 (N.Y. 1934). See Thy

roff v. Nationwide Mut. Ins. Co., 864 N.E.2d 1272, 1276 (N.Y. 2007) ; Eberha rd v. Marc u, 530 F.3d 122, 136 n.14 ( 2d Cir. 2008). The district cour t concluded that stock15

c e rt if ic ate s in g e ne ra l mu st b e loc ate d w ith in t he state in o rd e r t o b e atta c he d, c iti ngAB KC O Ind us ., Inc . v . App le F ilm s, Inc ., 35 0 N .E .2 d 8 99 , 9 01 (N .Y . 1 97 6) (s tatin gin d ic ta that “ so me intang ibles are deeme d to have be come e mbodied in formal pape r writing s . . . and in such instances attachment depe nds on the phy sical pre sence of the wr itten instrument within t he attachingjurisdiction.”) and D y er v. D y er, 247 N .Y.S. 540, 541-42 (N.Y. A pp. Div. 1st Dep’t 1931) (notingthat “[s] hare s owned by a non-r esident def

endant in a f

oreign corpor ation are not proper ty within the State of New

York, e ven thoug h the cor poration [is] doing busine ss here , un l e s s th e s t o c k

c e rt i f i c at e s th e m s e l v e s ar e f

o un d w i th i nth e S t at e . ” )
. 2 0 0 5 U . S
. D i s t . LE X IS 3760, at *27, 2005 WL551115, at *9. We note that such propositions appea r at fir st sight to be inconsistent with rece nt developments in which at least one Ne w York c ourt has orde red the tur no ve r, un de r N .Y . C. P.L .R. 52 25 , o f e xtrate rr ito ri a l st oc k c e rt if ic ate s. Se e Gr

y ph on Do me sti c VI , 41 A.D.3d 25, 836 N.Y.S.2d 4. These unr esolved issues re g ardingthe re ach of courts in New

York ove r extraterr itorial
a sse ts l ie at th e int e rs e c tio n o f N e w Y or k St ate c ivi l pr a c tic e and

Ne w Y or k St ate po lic y . It is
our u nd e rs tand ingthat th e highe st c ourt in N e w Y or

k h a s ye t to re so lve the m. M or e ov e r, the se issues appea

r to be dispositive of the district cour t’s conclusion that the stock c ertificates Koehle r is seeking , which have alway s been loc ated in B ermuda , are not subject to judgme nt enforc ement in New Yor

k. 2005 U.S. Dist. L EXI S 3760, at *21-31, 2005 WL551115, at *7-11. We theref ore c ertify

to the New Y ork State Court of Appe als the question whethe r a c ourt sitti ngin New Yor

k may , pursuant to N.Y. C.P.L .R. 5225(b), orde r a ba nk over which it has pe rs on a l juri sd ic tio n to de liv e r s toc k c e rt if ic ate s o wn e d b y

a jud g me nt d e bto r ( or

c a she qu a l to their value ) to a judg ment cre ditor, pursuant to N.Y. C.P.L .R. Article 52, whe n those stock16

cer tificates a re loc ated outside Ne w York. The New Y ork State Court of Appe als may , of
course , ref

ormulate or e x pand this question as it wishes. B. Authority

under F eder al Rules of Civil P roce dure As an a lternative, K oehler soug ht from the district cour t attachment of

the stock
cer tificates “ by

means of the equitable powe rs of [the district court] found in the ‘unless the cour t direc ts otherwise’ c lause of Rule 69( a).” Koehler , 2005 U.S. Dist. L EXI S 3760, at * 40, 2005 WL551115, at *13. “A mone y judgme nt is enforc ed by

a wr it of execution, unless the court dir e c ts o the rw ise . T he pr oc e dure on e xec uti on

-- and in p ro c e e din g s su

pp le me nta

ry to a nd in a id of jud g me nt o r e xec uti on

-- mus t a c c or d w iththe pr oc e dure of the state wh e re the c ourt is loc ate d, but a

fe de ra l st atut e g ov e rn s to the e xtent it a pp lie s. ” F e d. R. C iv. P. 6 9( a )( 1) (e mph a sis added)
. The district cour

t denied such e quitable re lief, and K oehler does not raise the “unless the court dire cts otherwise ” ar gument to this C ourt. We consider this alter native ar gument waived. Norton v. Sam’s Club, 145 F.3d 114, 117 (2d Cir. 1998). Finally , Koehler

argues that “Judge Ward had a uthority to issue the Turnover

order pursuant to the inher ent equitable pow ers of fede ral c ourts to enforc e money judgme nts via the
re me dy kn own a s c re dit or ’s bil ls. ” A c re dit or ’s bil l w a s u se d at c omm on law “ to p e rm it a jud g me nt c re dit or

to d isc ov e r t

he de bto r’ s a sse ts, to r e a c h e qu ita ble int e re sts no t su

bje c t to execution at law, and to se t aside fr audulent conve y ance s.” Grupo Me x icano De Desa rrollo v. Alliance B ond Fund, Inc., 527 U.S. 308, 319 (1999) ( citations omitt ed). Since Koehler does not
asser t that he invoked the mec hanism of the cr editor’s bill in his petiti ons to the district court seekingenfor ceme nt of the def ault judgme nt, we have no occa sion to decide whe ther such a17

reme dy was available. We have c onsidered K oehler ’s other a rguments and find them unava iling. CO NC LU SION For the fore g oing r easons, we VACATE that pa rt of the district cour

t’s Marc h 9, 2005 opinion and order

that ruled that the se ttlement betwee n Koehler and Dodwe ll discharg ed any rig hts Koehler ma

y have ha d to pursue cla ims ag ainst BB L , and we CERTI FY the following deter minative issue of state law to the New Y ork State Court of Appe als pursuant to Second Circuit L ocal Rule § 0.27 a nd New Y ork State Court of Appe als Rules of Prac tice § 500.27 (22 N.Y.C.R.R. § 500.27): whether a court sitting in Ne w York ma y order a bank ove r which it has pe rs on a l juri sd ic tio n to de liv e r s toc k c e rt if ic ate s o wn e d b y

a jud g me nt d e bto r ( or

c a she qu a l to their value ) to a judg ment cre ditor, pursuant to N.Y. C.P.L .R. Article 52, whe n those stock
cer tificates a re loc ated outside Ne w York. We also here by

ORDER that the Clerk of the Court tra nsmit t o the Clerk of the New Yo rk State Court

of Ap pe a ls a

Ce rt if ic ate in t he fo rm atta c he d, tog e the r w itha c op y of thi s opinion and a complete set of the br iefs, appe ndices, a nd rec ord filed by

the par ties in this C ourt. This panel will reta in jurisdiction to decide the ca se once we have had the benef it of the views of the New York State Court of Appe als or that cour t declines c ertification. Finally , we or der the parties to bea

r equa lly any fee s and costs that may

be re quested by

the New York State Court of Ap pe a ls. CE RT IF IC AT ION Th e fo llo wi ngqu e sti on

is h e re by c e rt if ie d to the Ne w Y or

k St ate Court

of Ap pe a ls pursuant to Second Circuit L ocal Rule § 0.27 a nd 22 N.Y.C.R.R. § 500.27, as ordere d by the18

United States Court of Appea ls for the Sec ond Circuit. May a cour t sitt ing in Ne w York or der a bank over which it has per sonal jurisdiction to deliver stock ce rtificate s owned by a judg ment debtor (or cash e qual to their value ) to a judg ment cre ditor, pursuant to N.Y. C.P.L .R. Article 52, when those stock c ertifica tes are located outside N ew Yor k?