Opinion
111623/2006.
Decided on February 5, 2008.
For Plaintiff: Lester Schwab Katz Dwyer, LLP 120 Broadway New York, New York 10271 (Lawrence A. Steckman).
For Individual Defendant: Foley Lardner LLP 90 Park Avenue New York, New York 10016 (Susan J. Schwartz).
For Corporate Defendants: Baker McKenzie LLP 1114 Avenue of the Americas New York, New York 10036 (Richard De Palma).
In this breach of contract action, motion sequence numbers 001 and 003 are consolidated for disposition.
In motion sequence 001, defendants Michael Murray, Thomas Carroll and David Mendenhall move for an order to dismiss the complaint, pursuant to CPLR 3211 (a) (1), (7), and (8), on the grounds of a defense founded upon documentary evidence, failure to state a cause of action, and lack of jurisdiction over the individual defendants.
In motion sequence 003, defendants Cinch Connectors Inc. (Cinch Inc.), Cinch Connectors Limited (Cinch Ltd.), Safran USA Inc. (Safran USA) and Safran S.A. move for an order dismissing the complaint, pursuant to CPLR 3211 (a) (1) (3) and (7), on the grounds of a defense founded upon documentary evidence, the party asserting the cause of action has not legal capacity to sue, and failure to state a cause of action. Defendants also seek dismissal, pursuant to CPLR 327 (a), on the ground of forum non conveniens.
The following allegations are taken from the complaint. Plaintiff Apex Equity Partners Inc. (Apex) is a private equity firm incorporated in 1999 under the laws of Ontario, Canada. Its offices are located in Toronto, Ontario and Irvine, California. Over the last seven years, Apex has focused its business on management buyouts of private companies.
Defendant Cinch Inc. is a Delaware corporation, with its principal place of business in Lombard, Illinois. Cinch Inc. is a leading manufacturer of connectors and other interconnect products used in military/aerospace, computer, telecommunications, industrial, transportation and other industries.
Defendant Cinch Ltd. is a corporation incorporated in England and Wales and has its principal place of business in Nottinghamshire, England. Cinch Ltd. is a leading manufacturer of connectors and other interconnect products and systems for the military/aerospace industry, dealing in primarily European missile and military avionics.
Defendant Safran S.A., formerly known as Snecma S.A., is a French company, with its principal place of business in Paris, France. Safran S.A. is an aerospace and jet propulsion company that is listed on the Euronext Paris Stock Exchange.
Defendant Safran USA, formerly known as Snecma USA, Inc., is a Delaware corporation having its principal place of business in Des Plaines, Iowa. Safran S.A. is a holding company which owns 100% of the shares of Cinch Inc., Globe Motors Inc. and Safran USA.
Defendant Michael Murray is the President and Chief Executive Officer of Cinch Inc. Since 2004, he has been both Chairman and Director of Cinch Ltd., and an employee of Safran USA. He is a resident of the State of Illinois.
Defendant Thomas Carroll is the Vice President, Secretary, and Deputy General Counsel of Safran USA. Carroll is also secretary of Cinch Inc. Carroll is an Illinois resident.
Defendant David Mendenhall is Vice President of engineering at Cinch Inc. Mendenhall is also an Illinois resident.
In May 2002, Apex received a call from Fleck Research Inc. (Fleck), a statistical research firm engaged in collecting and providing data concerning various businesses in the connector industry. Flex advised Apex that Safran S.A. was attempting to sell Cinch Inc., Cinch Connectors Ltd., and Cinch S.A., and that all three entities could be a potentially profitable acquisition for Apex. Fleck suggested that Apex contact Jean-Claude LePage of Safran S.A. and or Murray at Cinch Inc. to discuss the opportunity of buying the available property.
In June 2002, Apex began discussions with Cinch Inc. and Cinch Ltd.'s parent company, Snecma S.A., to acquire Cinch Inc. On June 4, 2002, Apex signed a confidentiality and non-disclosure agreement concerning the potential acquisition of three Cinch entities, Cinch Inc., Cinch Ltd., and Cinch S.A. As part of the due diligence process, Apex attended a management presentation and visited a data room at the offices of the investment banker for Snecma S.A. in Paris, France. On June 18, 2002, Apex made a non-binding offer to Snecma S.A. of between $80 and $100 million dollars to purchase all three companies. In August, Apex increased that amount to $105 million dollars. A draft share-purchase agreement was submitted by Apex in October to effectuate the acquisition, but Snecma S.A selected another prospective purchaser for the transaction. However, Snecma S.A.'s effort to sell all three Cinch companies to one buyer failed. It subsequently sold Cinch S.A. individually to a different purchaser unrelated to this action.
In March 2003, an investment banker for Snecma S.A. contacted Apex to inform it that it was interested in selling the remaining two Cinch companies, Cinch Inc. and Cinch Ltd. (collectively, Cinch). On March 26, 2003, Apex submitted a preliminary non-binding offer, subject to due diligence. By June 23, 2003, Apex submitted a final offer to acquire Cinch for $65 million. On July 4, 2003, Snecma S.A. advised Apex that it accepted its preliminary offer and that Snecma S.A. was ready to begin the due diligence process. During negotiations, Snecma S.A. disclosed, for the first time, that it had previously provided a right of first refusal of Cinch to Valeo S. A., a French corporation. After additional negotiations, on December 17, 2003, Snecma SA advised Apex that it received a larger offer from another prospective purchaser. Negotiations between the parties terminated in December 2003.
In April 2004, Monalisa Berbey of Fleck contacted Apex regarding Cinch's growth in sales in the first quarter of 2004. By letter dated April 21, 2004, Apex increased the proposed purchase price of Cinch to $80 million (later increased to $100 million in July 2004) and the parties negotiated a new letter of intent. The non-disclosure agreement was subsequently amended by a letter dated May 12, 2004.
On August 18, 2004, Apex, Snecma S.A. and Snecma U.S.A. (collectively Snecma) executed a letter of intent (Letter of Intent) dated August 16, 2004, whereby Apex would purchase Cinch for $100 million. The Letter of Intent provides that the sellers would furnish the purchaser and its representatives time to perform a due diligence review, which entailed reasonable access, during normal business hours, for its management to obtain all pertinent information that included business, legal, and accounting information. The Letter of Intent also includes a clause extending the ninety-day exclusivity period of negotiation between the parties.
On May 11, 2005, Snecma S.A. merged with Sagem S.A., and the new entity became known as Safran S.A (Safran). As part of the merger, Safran assumed all of Snecma's obligations and liabilities in connection with the Letter of Intent. Subsequently, the parties agreed to extend the Letter of Intent through June 2005.
On June 27, 2005, Apex made Safran an alternative acquisition proposal. Safran agreed not to sell Cinch to another company during the period in which it considered Apex's revised proposal. On November 29, 2005, Apex was informed that the Safran Executive Board would agree to a purchase price of $85 million. On December 12, 2005, Safran accepted the $85 million cash offer and agreed that the closing of the acquisition would be subject to Apex's ability to obtain suitable financing. On December 20, 2005, Safran's Supervisory Board approved the sale of Cinch to Apex for $85 million, subject to confirmation by Safran's auditor, Deloitte Touche-Paris. On January 16, 2006, a draft divestiture announcement was disclosed publicly, stating that Safran had reached a verbal agreement with Apex to acquire the shares and assets of Cinch (subject to certain conditions regarding the expected closing, which was to take place during the following month). On February 9, 2006, the parties allegedly came to an oral agreement, as a result of a series of telephone conversations and e-mails, during January 2006. Those communications outlined the terms of the acquisition. Safran consented to moving forward with the transaction. However, the merger was contingent upon Apex's ability to secure the appropriate level of financing. In February and March 2006, Murray and Carroll acted as authorized agents for Cinch and Safran with regard to the transaction and related due diligence.
Apex alleges that defendants breached the parties' Letter of Intent when they interfered with, frustrated or delayed the due diligence process during the original 90-day exclusivity period and subsequent extensions which continued after the May 11th merger. Specifically Apex alleges that Carroll and Murray engaged in obstructive behavior by: (1) removing important schedules containing customer pricing information from the data room, making it impossible for Apex to determine customer profitability; (2) attempting to provide false information to lenders; (3) unreasonably prohibiting Apex from copying critical documents that included, but were not limited to, sales and gross margin data, material agreements, forecasts, budgets, aging of account receivables and payables, and inventory; (4) refusing to provide sales and gross margin data, documents, customer agreements, management presentations; (5) engaging in hostile behavior during a 2005 meeting; (6) not cooperating with accountants; (7) withholding key budget information, (8) delaying customer due diligence calls and visits, and (9) making materially false statements at a February 2006 meeting with regard to Cinch product lines, prospective sales, potential competition, and Cinch's relationship with key customers. Apex further alleges that Mendenhall made certain misrepresentations during the confirmatory due diligence meetings held on February 16, 2006 and March 15, 2006.
Apex argues that defendants' lack of cooperation made the due diligence process extremely difficult and costly and defendants' actions denied Apex full access to due diligence within the 90-day exclusivity period. Apex also argues that defendants' actions frustrated and defeated the parties' Letter of Intent and dissuaded Apex's financial sources from providing financing and adversely impacted Apex's ability to acquire Cinch. Apex further argues that, as a result of, and in reliance on, the oral agreement and written memorialization, Apex undertook to confirm and secure senior debt; subordinated debt and equity financing, at substantial expense; and directed its efforts to the closing of the Cinch transaction, foregoing other profitable investment or acquisition opportunities.
As a result, Apex commenced this action asserting claims for tortious interference with contract, breach of contract, fraud, conspiracy to commit fraud and tortious interference with prospective advantageous relationships. Apex seeks judgment jointly and severally amounting to at least $95,000,000 along with punitive damages, attorney's fees, costs and disbursements in this action.
Motion 001
Defendants Murray, Carroll, and Mendenhall move to dismiss the complaint, pursuant to CPLR 3211 (a) (8), for lack of jurisdiction of the person of the defendants. In the alternative, Murray, Carroll, and Mendenhall move to dismiss the complaint for failure to state a cause of action.
Murray, Carroll, and Mendenhall have established their entitlement to dismissal under CPLR 3211 (a) (8) by showing that they executed the subject agreement solely in their capacities as corporate officers, and without any intent to become personally liable to perform thereunder ( Metropolitan Switch Bd. Co. v Amici Assoc., Inc. , 20 AD3d 455 [2nd Dept 2005]).
In support of their motion to dismiss, Murray, Carroll, and Mendenhall tendered un-rebutted evidence that they are Illinois residents and that they do not have a presence or business affiliation in this State.
As the party seeking personal jurisdiction, Apex bears the burden of proof on the issue. "That burden, however, does not entail making a prima facie showing of personal jurisdiction; rather, the plaintiff[ ] need only demonstrate that facts may exist' to exercise personal jurisdiction over the defendant[s]" ( Brinkmann v Adrian Carriers, Inc ., 29 AD3d 615, 616 [2nd Dept 2006] [ citation omitted]; Bill-Jay Mach. Tool Corp. v Koster Indus., Inc , 29 AD3d 504 , 505 [2nd Dept 2006]).
Apex contends that Murray, Carroll, and Mendenhall consented to jurisdiction under CPLR 301 (a) when they signed the parties' Letter of Intent. Apex further contends that the Letter of Intent incorporated a forum selection clause which was binding on defendants. The Letter of Intent provides:
"This Agreement is to be governed by the laws of the State of New York, including all matters of construction, validity and performance, but without regard to the conflicts of laws principles thereof. The parties hereto agree to attorn to the sole jurisdiction of the courts of the State of New York and the Federal Courts of the United States of America located therein in respect of any and all disputes between and among the parties, whether in law or equity, arising out of or relating to this Agreement."
(Exhibit A to Affirmation of Richard A. De Palma, dated November 22, 2006) (De Palma Aff.).
The purpose "of forum selection clauses, which render the designated forum convenient as a matter of law, is to avoid litigation over personal jurisdiction, as well as disputes arising over the application of the long-arm statute, and it is the well-settled policy of the courts of this State to enforce contractual provisions for choice of law and selection of a forum for litigation.' Forum selection clauses, which are prima facie valid, are enforced because they provide certainty and predictability in the resolution of disputes,' and are not to be set aside unless a party demonstrates that the enforcement of such would be unreasonable and unjust or that the clause is invalid because of fraud or overreaching, such that a trial in the contractual forum would be so gravely difficult and inconvenient that the challenging party would, for all practical purposes, be deprived of his or her day in court'"
( Sterling Natl. Bank v Eastern Shipping Worldwide, Inc ., 35 AD3d 222, 222 [1st Dept 2006] [ citations omitted]).
"An individual cannot be subject to jurisdiction under CPLR 301 unless he is doing business in New York as an individual rather than on behalf of a corporation," ( Brinkmann v Adrian Carriers, 29 AD3d at 617). The subject Letter of Intent clearly stated that it was entered into between Apex and defendants Snecma U.S.A., Inc., and Snecma Limited. The Letter of Intent was later amended to reflect that the agreement was entered into between Apex and Safran. There was no intent to hold the corporate officers personally liable under the document's mandatory New York forum selection provision. Murray, Carroll, and Mendenhall are Illinois domicilaries, and contrary to Apex's contention, did not, under the subject Letter of Intent, personally submit to the jurisdiction of New York State courts. "Where a principal of a corporation expressly signs a contract in his or her capacity as an officer of the corporation, unless he or she purports to personally bind him or herself, he or she will not be held personally liable. . ." ( Maranga v McDonald T. Corp. , 8 AD3d 351 , 352 [2nd Dept 2004]). Here, there is no evidence that Murray, Carroll, and Mendenhall purported to personally bind themselves in the execution of the agreement. Furthermore, Apex has not demonstrated that additional facts exist by which this court may exercise personal jurisdiction over Murray, Carroll and Mendenhall. Therefore, such minimal contacts, without more, are insufficient to confer personal jurisdiction under New York's long-arm statute ( Bill-Jay Mach. Tool Corp. v Koster Indus., Inc ., 29 AD3d 504, supra).
Thus, the action is dismissed on grounds of lack of jurisdiction over the individual defendants Michael Murray, Thomas Carroll, and David Mendenhall. In light of the granting of a dismissal on these grounds, discussion of the merits of the dispute between Apex and Murray, Carroll, and Mendenhall is unnecessary.
Motion 003 Personal Jurisdiction
Cinch moves for dismissal pursuant to CPLR 3211 (a) (8) for lack of personal jurisdiction. As discussed, "to successfully oppose a pre-answer motion to dismiss a complaint pursuant to a CPLR 3211 (a) (8), the plaintiff need only make a prima facie showing that personal jurisdiction exists'" ( Bill-Jay Mach. Tool Corp. v Koster Indus., Inc ., 29 AD3d 504 , supra).
Apex has failed to make a prima facie showing that personal jurisdiction exists over Cinch. Neither of the Cinch entities are signatories to the subject agreement, and thus, contrary to Apex's contention, the Cinch defendants did not, under the subject Letter of Intent, submit to the jurisdiction of New York State's courts (L-3 Communications Corp. v Channel Tech., Inc., 291 AD2d 276, 277 [1st Dept 2002]). The Letter of Intent clearly stated that it was entered into between Apex and defendants SNECMA USA, Inc., and SNECMA Limited. Thus, Cinch is a non-party to the agreement.
Notwithstanding the fact that Cinch is a non-signatory to the Letter of Intent, Apex argues that Cinch is a party to the agreement because it is a subsidiary of Safran USA (formerly known as SNECMA USA, Inc.). Courts have held that where there is an absence of a factual predicate to support the contention that the parties are closely related, a forum selection clause will not be enforced against a non-party to the agreement ( id.). However, courts will "disregard the separate legal identities of the parent and subsidiary corporation if the parent intervenes in the subsidiary's management so thoroughly as to ignore the subsidiary's paraphernalia of incorporation, directors and officers" ( Dempsey v Intercontinental Hotel Corp., 126 AD2d 477, 478 [1st Dept 1987]). Here, there has been no such showing, and thus, New York has no jurisdiction over the Cinch defendants.
Therefore, the motion to dismiss is granted as to the Cinch defendants, and, as to these defendants, the complaint is dismissed.
Lack of capacity to sue
Safran argues that Apex, the party asserting the action, lacks legal capacity to sue under CPLR 3211 (a) (3) because of its failure, under Business Corporation Law § 1312, to obtain authorization to conduct business in this state. Business Corporation Law § 1312 (a) provides that:
"A foreign corporation doing business in this state without authority shall not maintain any action or special proceeding in this state unless and until such corporation has been authorized to do business in this state and it has paid to the state all fees and taxes imposed under the tax law or any related statute, as defined in section eighteen hundred of such law, as well as penalties and interest charges related thereto, accrued against the corporation. This prohibition shall apply to any successor in interest of such foreign corporation."
"Business Corporation Law § 1312 (a) constitutes a bar to the maintenance of an action by a foreign corporation found to be doing business' in New York without the required authorization to do business'" here ( S T Bank v Spectrum Cabinet Sales, 247 AD2d 373, 373 [2nd Dept 1998] [ citation omitted]).
There is no genuine dispute that Apex is not authorized to do business in New York State. Without said authorization, Apex cannot acquire the rights afforded foreign corporations authorized to do business in this state under § 1312 ( Airtran New York, LLC v Midwest Air Group, ___ AD3d ___, 844 NYS2d 233, 238 {46 AD3d 208} [1st Dept 2007]). However, the party relying upon this statutory barrier bears the burden of proving that the corporation's business in New York was not just casual or occasional but so systematic as to manifest continuity of activity within the jurisdiction ( S T Bank v Spectrum Cabinet Sales, 247 AD2d at 373). Contrary to defendants' contention, its motion papers did not establish, prima facie, that Apex was "doing business" in New York at the time the parties entered into the contract being sued upon, nor did it establish that Apex's business in New York was systematic as to manifest continuity of activity within the jurisdiction ( id.).
Accordingly, there is a presumption that Apex does business, not in New York or any other state, but in the place of its incorporation ( id. at 374). Therefore, an action may be maintained by Apex, a foreign corporation, in like manner and subject to the same limitations, as an action or special proceeding brought by a domestic corporation, except as otherwise prescribed by statute (Business Corporation Law § 1313).
Failure to State a Cause of Action
(a) Tortious Interference with Contract
Apex's first two causes of action, which allege that Safran tortiously interfered with its own contract, quite clearly do not state a legally sufficient cause of action, and must be dismissed ( Buller v Giorno , 28 AD3d 258 , 259 [1st Dept 2006]; Koret, Inc. v Christian Dior, S.A., 161 AD2d 156, 157 [1st Dept], lv denied 76 NY2d 714). New York courts have held that a corporate defendant cannot tortiously interfere with its own contract ( id.).
In its third cause of action, Apex has sufficiently pleaded a cause of action for tortious interference with contract. A claim for "tortious interference with contract requires: (1) the existence of a valid contract between plaintiff and a third party, (2) defendant's knowledge of the contract, (3) defendant's intentional procurement of a breach of the contract without justification, (4) actual breach of the contract, and (5) resulting damages" ( Snyder v Sony Music Entertainment, Inc., 252 AD2d 294, 299 [1st Dept 1999] [ citations omitted]). Here, the complaint alleges that Safran tortiously interfered with Apex's lender contracts by obstructing the due diligence process and by allowing their agents to provide false and misleading information to Apex's financing sources. The complaint further alleges that said actions directly caused Apex's financing sources to withdraw their commitments, and subsequently breach their contractual obligations to Apex.
(b) Tortious Interference with Prospective Business Relations
Apex's fourth cause of action, for tortious interference with prospective economic advantage, fails. "The claim for tortious interference with prospective business relations failed to include the necessary allegation that [Safran's] conduct was motivated solely by malice or to inflict injury by unlawful means, beyond mere self-interest or other economic considerations" ( Shared Communications Servs. of ESR, Inc. v Goldman Sachs Co. , 23 AD3d 162 , 163 [1st Dept 2005]). "Wrongful means' includes physical violence, fraud, misrepresentation, civil suits, criminal prosecutions, and some degree of economic pressure, but more than simple persuasion is required" ( Snyder v Sony Music Entertainment, 252 AD2d at 300). The complaint alleges that Safran's actions were motivated by economic considerations and self-interest. The complaint further alleges that the actions of Safran's corporate officers was motivated by their interest in maintaining employment and position with the corporation. Thus, the requisite allegation of malice is absent from the pleadings.
(c) Breach of Contract
Apex's fifth cause of action, for breach of the August 2004 Letter of Intent, also fails.
On a motion to dismiss, pursuant to CPLR 3211 (a) (1), the court may grant dismissal when documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law. "Construction of an unambiguous contract is a matter of law, and the intention of the parties may be gathered from the four corners of the instrument and should be enforced according to its terms" ( Beal Sav. Bank v Sommer , 8 NY3d 318 , 324).
Apex argues that Safran breached the Letter of Intent when it failed to complete the due diligence process surrounding their business transaction. The Letter of Intent provides:
"The purpose of this Letter of Intent and Exclusivity Agreement ("Agreement") is to set out certain terms of a possible transaction hereinafter described ("The Possible Transaction") and to provide the Purchaser with an exclusivity Period (as hereinafter described) within which to complete its Due Diligence Review and the parties to prepare and execute the Definitive Agreement. Certain provisions of this Agreement are only an expression of the intent to enter into a Definitive Agreement to give effect to the Possible Transaction and describe the presently anticipated terms of the Possible Transaction. The provisions of this section entitled Exclusivity, Right of First Offer, Break-Up Fee, No Conflicts, Confidentiality, and Non-Disclosure, Governing Law, Costs and Expenses, Abandonment of Possible Transaction and Termination below are binding upon and enforceable against each of the Sellers and Purchaser. None of the provisions of any other section is binding upon or enforceable against the Sellers or the Purchaser and no past or future action, course of conduct, or failure to act relating to the Possible Transaction or relating to the terms of the Possible Transaction or the Definitive Agreement will give rise to or serve as a basis for any obligation or other liability on the part of the parties or any of the Target Companies"
(Exhibit A to Affirmation of Richard A. Palma, dated November 22, 2006).
The Letter of Intent, which is clearly a preliminary, non-binding proposal to agree, conclusively negates Apex's breach of contract claim and establishes defendants' right to dismissal under section 3211 (a) (1). The document clearly expresses the parties' intention to enter into a contract at a later date and nowhere states that the parties would be legally bound until such future agreement is reached. Moreover, the letter's first sentence, setting forth that its purpose was "to set out certain terms of a possible transaction," as well as the letter's statement that "[n]one of the provisions of any other section is binding or enforceable against the Sellers or the Purchaser" and reflects the parties' intent not to be bound beyond the provisions addressing "Exclusivity, Right of First Offer, Break-Up Fee, No Conflicts, Confidentiality, and Non-Disclosure, Governing Law, Costs and Expenses, Abandonment, of Possible Transaction and Termination" (Exhibit A to De Palma Aff.) ( see Aksman v Xiongwei Ju , 21 AD3d 260 , 261 [1st Dept]), lv denied 5 NY3d 715). The Letter of Intent afforded a 90-day period in which to perform due diligence. The terms of that agreement do not make Safran liable for damages for Apex's failure to obtain financing. It was not a binding agreement as evidenced by the language of the document which expressly contemplated the execution of a subsequent agreement ( F D Bagel Corp. v Wald Realty, Inc ., 41 AD3d 778 , 779 [2nd Dept]), lv denied 9 NY3d 810.
However, Apex's sixth cause of action, for breach of the February 9, 2006 oral agreement between Apex and Safran, survives dismissal. The complaint alleges that Safran failed to comply with its obligations under the oral agreement, as memorialized in the "stock purchase agreement" to sell Cinch to Apex for $85 million dollars and its breach of that agreement has caused Apex financial harm.
(d) Fraud
Safran also moves for dismissal, pursuant to CPLR 3211 (a) (7), for Apex's failure to state a cause of action for common-law fraud.
In its seventh cause of action, Apex has successfully plead a cause of action for common-law fraud. "To sustain a cause of action alleging fraud, a party must show a misrepresentation or a material omission of fact which was false and known to be false by the defendant, made for the purpose of inducing the other party to rely upon it, justifiable reliance of the other party on the misrepresentation or material omission, and injury" ( Cayuga Partners, LLC v 150 Grand, LLC, 305 AD2d 527, 527-528 [2nd Dept 2003]; see Caniglia v Chicago Tribune-N.Y. News Syndicate Inc., 204 AD2d 233, 234 [1st Dept 1994]). The complaint alleges that defendants made several misrepresentations and material omissions during its negotiations and due diligence surrounding the Cinch acquisition. The complaint further alleges that Apex justifiably relied on said misrepresentations and omissions and suffered injury as a result ( id.).
(e) Conspiracy to Commit Fraud
Apex's eighth cause of action, to recover damages for conspiracy to commit fraud, is dismissed. New York does not recognize civil conspiracy to commit a tort as an independent cause of action ( see Crispino v Greenpoint Mtge., Corp ., 2 AD3d 478 , 480 [2nd Dept 2003]; Heslin v Metropolitan Life Ins. Co., 287 AD2d 113, 115 [3rd Dept 2001]; Pappas v Passias, 271 AD2d 420, 421 [2nd Dept 2000]; Alexander Alexander of NY v Fritzen, 68 NY2d 968, 969).
(f) Forum non conveniens
On a motion to dismiss on the ground of forum non conveniens, the burden is on a defendant challenging the forum to demonstrate relevant private-or public-interest factors which militate against accepting the litigation ( Stravalle v Land Cargo, Inc ., 39 AD3d 735 , 736 [2nd Dept 2007]). This court has discretion as to whether to retain jurisdiction ( id.).
CPLR 327 (a) states:
"When the court finds that in the interest of substantial justice the action should be heard in another forum, the court, on the motion of any party, may stay or dismiss the action in whole or in part on any conditions that may be just. The domicile or residence in this state of any party to the action shall not preclude the court from staying or dismissing the action."
Though no one factor is controlling, the factors a court considers on such a motion includes: (1) the burden on the New York courts, (2) the potential hardship to defendant, (3) the availability of an alternative forum in which plaintiff may bring suit, (4) that both parties to the action are nonresidents, and (5) that the transaction out of which the cause of action arose occurred primarily in a foreign jurisdiction ( Ghose v CNA Reins. Co. Ltd. , 43 AD3d 656, 660 [1st Dept 2007]; Shin-Etsu Chem. Co., Ltd. v ICICI Bank Ltd. , 9 AD3d 171 , 176 [1st Dept 2004]). The burden rests upon the defendants challenging the forum to demonstrate relevant factors which militate against accepting the litigation ( id.).
The transactions out of which Apex's cause of action arose occurred primarily in a foreign jurisdiction. Frank Fischer, the Managing Director of Apex, avers that the majority of the allegations giving rise to the alleged liability involve activities that took place during negotiations at Apex's offices in Toronto, Canada; in a data room set up by Cinch in the Toronto office of Baker McKenzie LLP; the Lombard, Illinois office of Cinch USA; the California Offices of Sun Microsystems and Raytheon; a Cinch factory in Vinita, Oklahoma; a Cinch factory in Worksop, North Nottinghamshire, UK; and the Toronto office of the accounting firm Deloitte Touche (Affidavit of Frank Fischer, dated January 12, 2007).
However, the Letter of Intent incorporated a New York choice of law provision and Apex's attorneys are located within this state. Therefore, this action has some nexus to New York. In light of these facts, dismissal of the amended complaint on the ground of forum non conveniens is unwarranted.
Accordingly, it is
ORDERED that motion 001 is granted, and the complaint is severed and dismissed as against defendant Michael Murray, defendant Thomas Carroll, and defendant David Mendenhall, and the Clerk is directed to enter judgment in favor of these defendants, with costs and disbursements to them as taxed by the Clerk of the Court; and it is further
ORDERED that motion 003 to dismiss is granted in its entirety as to defendant Cinch Connectors Inc. and defendant Cinch Connectors, Limited, and as to these defendants, the complaint is severed and dismissed, and the Clerk is directed to enter judgment in favor of these defendants, with costs and disbursements to them as taxed by the Clerk of the Court; and it is further
ORDERED that motion 003 to dismiss is granted in part with regard to Safran USA Inc. and Safran S.A., to the extent that the first, second, fourth, fifth, eight, and ninth causes of action are severed and dismissed; and it is further
ORDERED that Safran USA Inc., and Safran S.A., the remaining defendants, are directed to serve their answers to the surviving claims in the complaint within 20 days after service of a copy of this order with notice of entry.