Linares v. Herrera Virguez

Background

Zelhideth Montano Linares and Jose Luis Herrera Virguez were romantically involved and lived together in Venezuela from 2009 through 2016. They have two minor children. In an earlier related proceeding involving assets held in three Merrill Lynch accounts, Linares and Herrera signed a settlement agreement on February 21, 2019. The agreement specified how the funds would be distributed, provided that the Southern District of New York would retain jurisdiction to enforce the agreement, and included a broad mutual release. The release excluded claims concerning child support, visitation, and custody.

Linares alleged that, after the settlement, Herrera filed 41 lawsuits against her in Venezuela seeking to undo transactions involving her sales of real property. She claimed that these lawsuits violated the settlement agreement. Her complaint sought several declarations, including declarations barring Herrera from bringing claims unrelated to their minor children, dismissing pending claims, invalidating awards from such lawsuits, and requiring the return of property. She also requested attorneys’ fees, costs, and other relief.

Jurisdiction

Herrera moved to dismiss for lack of subject-matter jurisdiction, lack of personal jurisdiction, and failure to state a claim. The court agreed that diversity jurisdiction was unavailable. Linares was a citizen of Venezuela who resided in Florida on a United States-issued visa, and Herrera was also a citizen of Venezuela. Because both parties were foreign citizens, complete diversity was absent.

The court nevertheless concluded that subject-matter jurisdiction could exist to enforce the settlement agreement because the earlier court had specifically retained jurisdiction over that agreement and the mutual releases. The court stated that this jurisdiction depended on whether Linares’s claims related to the settlement agreement and when the claims underlying the Venezuelan lawsuits arose. The court also held that it had personal jurisdiction over Herrera for settlement-enforcement actions because the parties agreed that such suits could be brought in the Southern District of New York, and Herrera admitted that point.

Failure to State a Claim

The court held that the complaint did not state a legally sufficient claim. A declaratory judgment is a type of remedy, not an independent cause of action. Linares did not identify an underlying substantive claim that would support the requested declarations.

The court considered whether Linares might have intended to assert a breach-of-contract claim based on the settlement agreement. It held that the complaint did not plead the elements of such a claim or provide enough substantive details about the Venezuelan lawsuits to determine whether they violated the agreement.

Disposition

The court granted Herrera’s motion to dismiss. It dismissed Linares’s claims without prejudice and granted her leave to amend because she might be able to correct the complaint’s defects. Linares had 30 days from the date of the Opinion and Order to file an amended complaint or request an extension based on good cause. The court stated that failure to do so would lead to entry of judgment and closure of the case. Herrera would have 21 days from the filing of any amended complaint to answer or otherwise respond.