Opinion
No. CV 08 5023192S
March 29, 2011
MEMORANDUM OF DECISION RE MOTION TO DISMISS #211
The plaintiff, Jean-Pierre Ibar, commenced this suit by service of process on the defendants, Stratek Plastics (Stratek) and Stamford Polymer Research Laboratory, Inc. (Stamford), on September 2, 2008. The fifteen-paragraph complaint seeks relief for various claims which include Stratek's refusal to pay fees and royalties as well as disclose royalty payments and financial terms; misrepresentations regarding the use of the plaintiff's technology, the arbitration award and the nature of the Services Agreement; the malicious filing of lawsuits; conspiracy to defraud justice and eliminate the plaintiff's interest in Stratek; the defrauding of the plaintiff's ownership in Stratek; and intentional infliction of mental distress to the plaintiff. On November 3, 2008, Stamford and Stratek each filed a motion to dismiss — Stamford for lack of subject matter jurisdiction due to a contracted obligation to binding arbitration and Stratek for lack of personal jurisdiction, subject matter jurisdiction due to a contracted obligation to binding arbitration and forum non conveniens. The court (Holden, J.), on September 11, 2009, granted the motion as to Stamford and, as to Stratek, granted the motion as to all paragraphs except paragraph 13 which states: "Stratek's defrauding of Ibar's ownership in Stratek pursuant to the initial agreement of July 4th 1999. Ibar contracted to have 45% of the shares of a Corporation that owns and commercializes Ibar's inventions. Stratek owns and commercializes Ibar's inventions, yet Ibar owns zero stock of Stratek or of any Company owning stock in Stratek."
Ibar, then pro se, purported to file the complaint on his own behalf and on the behalf of Eknet Research Corp. A valid appearance, however, has not been entered on behalf of Eknet. Accordingly, Ibar will be referred to as the plaintiff.
On November 22, 2009, Stamford filed a second motion to dismiss due to lack of subject matter jurisdiction on the ground that the plaintiff lacked standing to sue on behalf of Plastitech, a corporation. Stratek also filed a second motion to dismiss, on November 28, 2009, adopting and joining the motion to dismiss filed by Stamford. On November 30, 2009, the court (Alander, J.) denied both defendants' motions, holding that the plaintiff was not attempting to assert a right on behalf of a corporation, but that he was "asserting his own right to forty-five percent of the stock in the corporation that is commercializing his invention." On the same day, the plaintiff withdrew Stamford from the case.
From this point on, Stratek will he referred to as the defendant.
Prior to the filing of the second motions to dismiss, on September 11, 2009, the plaintiff filed an application for a prejudgment remedy. After a two-day hearing, the court (Robinson, J.) issued a memorandum of decision on September 27, 2010. With respect to the issue of standing, it found that "[n]otwithstanding [the plaintiff's] assertion that the issue of standing has been previously decided, this court finds that no trial court has decided this issue of standing before. But, even if it has been previously raised, the law of the case doctrine would not preclude the trial court from revisiting this issue . . . The plaintiff will likely be found to lack standing to assert claims on behalf of Plastitech. Therefore the prejudgment remedy should be denied."
On October 13, 2010, the plaintiff filed a motion to correct the record to reflect that:(1) the plaintiff had filed an objection and memorandum of law in response to the second motions to dismiss that were filed on September 22 and 28, 2009 and that (2) the court had denied those motions. On November 8, 2010, the court (Silbert, J.) granted the plaintiff's motion, correcting the file as to denial of the defendant's September 28, 2010 motion to dismiss and instructing the clerk to place the plaintiff's objection and memorandum of law in the file.
The defendant filed a third motion to dismiss due to lack of subject matter jurisdiction on the ground that the plaintiff lacks standing to sue on behalf of a corporation on November 1, 2010. The plaintiff filed an objection on January 18, 2011 and the defendant filed a reply on February 2, 2011. The plaintiff filed a reply to the defendant's reply on February 17, 2011. The matter was heard at short calendar on February 28, 2011.
DISCUSSION
"A motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court . . . A motion to dismiss tests, inter alia, whether, on the fact of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Caruso v. Bridgeport, 285 Conn. 618, 627, 941 A.2d 266 (2008). "The motion to dismiss shall be used to assert (1) lack of jurisdiction over the subject matter, (2) lack of jurisdiction over the person, (3) improper venue, (4) insufficiency of process, and (5) insufficiency of service and process. This motion shall always be filed with a supporting memorandum of law, and where appropriate, with supporting affidavits as to facts not apparent on the record." Practice Book § 10-31(a). "[T]he question of subject matter jurisdiction, because it addresses the basic competency of the court, can be raised by any of the parties, or by the court sua sponte, at any time . . . Moreover, [t]he parties cannot confer subject matter jurisdiction on the court, either by waiver or by consent." (Internal quotation marks omitted.) New Hartford v. Connecticut Resources Recovery Authority, 291 Conn. 511, 518, 970 A.2d 583 (2009).
"[T]he plaintiff bears the burden of proving subject matter jurisdiction, whenever and however raised." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. New London, 265 Conn. 423, 430 n. 12, 829 A.2d 801 (2003). "[I]t is the burden of the party who seeks the exercise of jurisdiction in his favor . . . clearly to allege facts demonstrating that he is a proper party to invoke judicial resolution of the dispute . . . It is well established that, in determining whether a court has subject matter jurisdiction, every presumption favoring jurisdiction should be indulged." (Citation omitted; internal quotation marks omitted.) Wilcox v. Webster Ins. Co., 294 Conn. 206, 213-14, 982 A.2d 1053 (2009).
The defendant argues that the court lacks subject matter jurisdiction to hear this case because the plaintiff lacks standing to assert the claims alleged. It maintains that the plaintiff does not, and has never, owned stock in the defendant. Accordingly, any claims against the defendant for breach of contract must be brought by Plastitech, the corporation that owns stock in the defendant. Moreover, the law of the case doctrine precludes the plaintiff from bringing a cause of action on behalf of Plastitech because the memorandum of decision for an application of a prejudgment remedy by the court (Robinson, J.) concluded that he does not have standing to sue on behalf of Plastitech.
The plaintiff replies that the memorandum of decision for the prejudgment remedy was improperly decided because, due to an error on the case docket which was later corrected by the plaintiff, the court found that the issue of standing had never been addressed by the court. Prior to the decision rendered by Judge Robinson, the court (Alander, J.) had found that the plaintiff was not bringing a claim against the defendant on behalf of Plastitech, but rather on his own behalf. Since, the plaintiff maintains, he has never owned any stock in either Plastitech or the defendant, he has standing to allege that the defendant breached the contract referred to in paragraph thirteen of the complaint.
In its reply, the defendant reiterates its position that the court can rely on the factual findings made in the context of a prejudgment remedy hearing as to the issue of standing and that Judge Alander's ruling is not the law of the case. In the plaintiff's surreply, he reiterates his position that he is not a stockholder in either Plastitech or the defendant and that he has always qualified his statements about ownership of stock in the companies. Moreover, the plaintiff asserts that Judge Robinson's decision is not binding as it did not decide the merits of the case.
The parties also contest whether a loan that was guaranteed by Northern Technologies to Plastitech is relevant to the issue of standing and additionally dispute whether the plaintiff's inclusion of information related to the arbitration is relevant to the motion. The court declines to address these issues as they are not relevant to the court's decision on the issue of standing.
"It is a basic principle of our law . . . that the [plaintiff] must have standing in order for a court to have jurisdiction to render a declaratory judgment . . . Standing is not a technical rule intended to keep aggrieved parties out of court; nor is it a test of substantive rights. Rather it is a practical concept designed to ensure that courts and parties are not vexed by suits brought to vindicate nonjusticiable interests and that judicial decisions which may affect the rights of others are forged in hot controversy, with each view fairly and vigorously represented . . . Thus, standing does not hinge on whether the plaintiff will ultimately be entitled to obtain relief on the merits of an action, but on whether he is entitled to seek the relief." (Citation omitted; internal quotation marks omitted.) Pinchbeck v. Dept. of Public Health, 65 Conn.App. 201, 205, 782 A.2d 242, cert. denied, 258 Conn. 928, 783 A.2d 1029 (2001). "Where a plaintiff lacks standing to sue, the court is without subject matter jurisdiction." (Internal quotation marks omitted.) Ardito v. Olinger, 65 Conn.App. 295, 300, 782 A.2d 698, cert. denied 258 Conn. 942, 786 A.2d 429 (2001).
"The law of the case is not written in stone but is a flexible principle of many facets adaptable to the exigencies of the different situations in which it may be invoked . . . In essence it expresses the practice of judges generally to refuse to reopen what has been decided and is not a limitation on their power . . . New pleadings intended to raise again a question of law which has been already presented on the record and determined adversely to the pleader are not to be favored . . . But a determination so made is not necessarily to be treated as an infallible guide to the court in dealing with all matters subsequently arising in the cause . . . Where a matter has previously been ruled upon interlocutorily, the court in a subsequent proceeding in the case may treat that decision as the law of the case, if it is of the opinion that the issue was correctly decided, in the absence of some new or overriding circumstance." (Citation omitted; internal quotation marks omitted.) Breen v. Phelps, 186 Conn. 86, 99, 439 A.2d 1066 (1982). "A judge should hesitate to change his own rulings in a case and should be even more reluctant to overrule those of another judge." Id. Whereas it is generally true that a determination made in the course of prejudgment remedy proceedings render the law of the case doctrine inapplicable because the court's inquiry in such proceedings is limited to determining whether there is probable cause that the plaintiff will succeed on the merits, the issue of standing relates to the subject matter jurisdiction of the court and must be fully resolved before any further proceedings. Marlin Broadcasting v. Law Office of Kent Avery, LLC, Superior Court, judicial district of Hartford, Docket No. CV 06 4021500 (February 13, 2007, Hennessey, J.T.R.) [ 42 Conn. L. Rptr. 868], aff'd, 101 Conn.App. 638, 922 A.2d 1131 (2007). Accordingly, if the question of standing and subject matter jurisdiction has been fully addressed and decided during a prejudgment remedy proceedings, the law of the case doctrine can apply. Id.
In the present case, the defendant argues that law of the case doctrine should apply to Judge Robinson's decision because it fully addressed the issue of standing. The plaintiff argues that the decision by Judge Alander should control. In evaluating the standing issue, Judge Robinson found that "[t]he corporation (in this case, Plastitech), and not the owner of the shareholder of the corporation (in this case Ibar) is the party in interest. Therefore, if Ibar wished to challenge anything deriving from the shareholder position of Plastitech, then an action must be brought on its behalf, because it would be the real party in interest." She continued to find that "[n]otwithstandings Ibar's assertion that the issue of standing has been previously decided, this court finds that no trial court has decided this issue of standing before" and that "[t]he plaintiff will likely be found to lack standing to assert claims on behalf of Plastitech." However, prior to Judge Robinson's decision, and unbeknown to her due to a error in the case docket, the issue of standing had been decided. Judge Alander, in deciding the defendant's second motion to dismiss for lack of standing, held that the plaintiff is not "asserting a right on behalf of a corporation. He's asserting his own right to forty-five percent of the stock in the corporation that is commercializing his invention . . . [H]e's claiming . . . he, personally, had this agreement and it was breached. That's . . . how I read paragraph 13."
Judge Robinson concluded that the plaintiff owned stock in Plastitech and that Plastitech owned stock in the defendant. These findings of fact supported the holding that Plastitech would have to bring suit against the defendant and that the plaintiff likely would not have standing to sue on behalf of Plastitech. Judge Robinson's holding, however, was made without the benefit of Judge Alander's decision on the issue and was based on the assumption that the plaintiff was bringing a shareholder action. Based on Judge Robinson's findings of facts, she considered a different standing issue — whether or not the plaintiff had standing to bring a suit on behalf of Plastitech. Moreover, her decision, which was limited to her power to the issue a prejudgment remedy, did not actually render a conclusion as to standing, stating only that "[t]he plaintiff will likely be found to lack standing to assert claims on behalf of Plastitech." (Emphasis added.) Accordingly, the law of the case doctrine does not apply to Judge Robinson's decision.
Here, the parties are disputing, on a motion to dismiss, whether the plaintiff is seeking to sue on behalf of Plastitech or on his own behalf. Judge Alander, on a motion to dismiss, has already made a determination. Since the legal standard is the same, the application of the law of the case is appropriate. Cf. McCutcheon Burr, Inc. v. Berman, 218 Conn. 512, 526, 590 A.2d 438 (1991) (holding that because legal standard for motion to dismiss is different from motion to dissolve prejudgment attachment, law of the case is inapposite). This court finds no reason to disturb the decision of Judge Alander which denied the defendant's second motion to dismiss for lack of standing, as that ruling is not clearly erroneous. See Saunders v. Firtel, Superior Court, judicial district of Fairfield, Docket No. CV 05 4007690 (December 27, 2006, Arnold, J.), aff'd, 293 Conn. 515, 978 A.2d 487 (2009).
For the foregoing reasons, the defendant's motion to dismiss for lack of standing is denied.