In Sojitz Corp. v. Prithvi Info. Solutions Ltd., 921 N.Y.S.2d 14 (1st Dep't 2011), the petitioner, Sojitz, a Japanese company, and the respondent, Prithvi, an Indian company, entered into a contract under which Sojitz agreed to provide telecommunications equipment to Prithvi in India. The contract was governed by English law and contained a clause referring disputes to arbitration in Singapore. Sojitz delivered the equipment, but Prithvi failed to pay invoices. Sojitz sought an attachment order against Prithvi, alleging that it intended to commence arbitration but that Prithvi might dissipate assets before a tribunal could be constituted. The Supreme Court granted the order and ordered Sojitz to post a bond. Subsequently, Sojitz attached a debt of USD 18,480 that was owed to Prithvi by one of its customers in New York. Prithvi appealed.

The Appellate Division dismissed the appeal and affirmed the order. The starting point was section 7502(c) of the CPLR, which gives New York courts authority to issue preliminary injunctions and attachments in aid of all arbitrations, including those taking place outside New York, where the award to which the applicant may be entitled would otherwise be rendered ineffectual. There was no dispute that that requirement was satisfied here, but Prithvi argued that the court did not have personal jurisdiction over it.

The Appellate Division held that the court did not need to have personal jurisdiction over Prithvi and that attachment for security purposes was proper. It cited Shaffer v. Heitner, 433 U.S. 186 (1977), as authority for the proposition that a plaintiff might be entitled to attach property located in a particular state as security for a judgment being sought in another forum without demonstrating any other connection with that state. It held that section 7502 did not offend constitutional requirements of due process when it was used for the purposes of security rather than to confer personal jurisdiction.

This is apparently the first time this issue has been decided in New York, and the decision follows that of courts in other jurisdictions (for example, the DC Court of Appeals in Barclays Bank SA v. Tsakos, 543 A.2d 802 (DC 1988)). This decision demonstrates the commitment of New York state courts to ensuring that international arbitration agreements are enforced and that arbitral awards provide meaningful relief.