Opinion
Civil Action No: 03-1668 C/W 03-1908, Section: "D" (3).
September 1, 2004
Before the court are the following motions:
(1) "Motion to Dismiss for Lack of In Personam Jurisdiction, and Alternatively for Dismissal on Grounds of Forum Non Conveniens" filed by Defendant, Barwil Universal Denizcilik ve Tasimacilik; and
(2) "Reurged Motion to Dismiss" filed by Defendants, Barwil Agencies (N.A.), Inc., Barwil Agencies, A.S., and Wilh. Wilhelmsen, A.S.A.
Plaintiffs, Industrial Maritime Carriers (Bahamas), Inc. (IMB) and Intermarine, Inc., filed memoranda in opposition. The motions, set for hearing on Wednesday, August 18, 2004, are before the court on briefs, without oral argument. Now, having considered the memoranda of counsel, the record and the applicable law, the court finds that the motions should be denied.
Defendants' motions were originally set for hearing on April 14, 2004, but at that time no discovery had been conducted, and the court (treating the motions as motions for summary judgment) denied the motions without prejudice to allow Plaintiffs to conduct discovery necessary to properly respond. ( See Minute Entry, Doc. No. 37).
I. Background
A. Cast of Characters
Plaintiff IMB is alleged to be "a corporation organized and existing under the laws of the Bahamas with its principal place of business in New Orleans, Louisiana. At all material times . . ., IMB acted as a time charterer of vessels for the carriage of goods by sea for hire." (Complaint at ¶ I).
Plaintiff Intermarine is "a corporation organized and existing under the laws of the State of Louisiana with its principal place of business in New Orleans, Louisiana. At all material times . . ., Intermarine acted as the disclosed managing agent for IMB." (Complaint at ¶ II).
Defendant Wilh. Wilhelmsen, A.S.A. is a global shipping company headquartered in Lysaker, Norway. It does not conduct business in its own name, but rather is a holding company that owns subsidiaries. (Sjur Galtung Dep. at 44:9-12).
Defendant Barwil Agencies, A.S. (also referred to in the short form as "Barwil Oslo" and "Barwil Norway" in this Minute Entry, the parties' briefs and in the depositions referenced therein) is a Norwegian company with its principal office located in Oslo, Norway. It is a wholly-owned subsidiary of Wilh. Wilhelmsen, A.S.A., and either wholly owns or partly owns agency companies around the world. (Cevdet Basacik Dep. at 149:14-25).
Defendant Barwil Universal Denizcilik ve Tasimacilik (also referred to in the short form as "Barwil Universal," and "Barwil Turkey" and/or "Barwil Universal/Turkey" in this Minute Entry, the parties' briefs and in the depositions referenced therein) was established in 1990, under Turkish law as the by-product of a joint venture agreement between Barwil Agencies, A.S. and the shareholders of Universal Denizcilik, an already-existing ship agency firm in Istanbul. Universal Denizcilik was subsumed into Barwil Universal after its assets were purchased by the new joint stock company. Barwil Agencies, A.S. is a 50% shareholder of Barwil Universal/Turkey and the former Turkish owners of Universal Denizcilik are the remaining 50% shareholders. Pursuant to a marketing agreement between Barwil Oslo and Barwil Universal/Turkey, Barwil Oslo actively markets Barwil Universal/Turkey's agency services around the world.
Defendant Barwil Agencies North America, Inc. (also referred to as "Barwil Agencies N.A.," "Barwil N.A." and "Wilh. Wilhelmsen U.S.A.") is a United States corporation whose principal offices are located in New Orleans, Louisiana. Barwil N.A. is a wholly-owned subsidiary of Barwil Oslo, and it is incorporated under the name Wilh. Wilhelmsen (USA), Inc., but does business as Barwil Agencies N.A.
B. Why do Plaintiffs sue Defendants?
In this lawsuit, Plaintiffs allege that in 1997, IMB (as the time charterer of the M/V INDUSTRIAL BRIDGE and the M/V AMDERMA) entered into two contracts of carriage with Centrans International Corporation to carry construction equipment aboard the two vessels from Masan, Korea to Dernice, Turkey. IMB entered into a shipping agency agreement with Barwil Turkey which provided that Barwil Turkey would act as IMB's local shipping agent in Turkey for the two shipments loaded aboard the M/V INDUSTRIAL BRIDGE and the M/V AMDERMA.
Five years after the aforementioned cargo was discharged in Turkey, Plaintiffs were allegedly notified for the first time that they had been sued for mis-delivery of cargo in a lawsuit filed in Turkey by the receiver (Daewoo Corporation) of some of the cargo carried aboard the M/V INDUSTRIAL BRIDGE and the M/V AMDERMA, and that a Turkish court had rendered two judgments against Intermarine and IMB totaling almost $4,000,000, plus interest.
According to Plaintiffs, although Barwil Turkey had been retained to serve as IMB's local husbanding agent in Turkey, "[a]t no time did Barwil or its attorney either contact Intermarine or IMB to seek instructions, testimony or other evidence, or to receive any authority whatsoever, including but not limited to the authority to waive proper service, to file responsive pleadings, or any other acts undertaken by Barwil through its attorney." (Complaint at ¶ XVIII).
Asserting admiralty and maritime jurisdiction, Plaintiffs sue Barwil Universal/Turkey, Barwil Oslo, Barwil N.A. and Wilh. Wilhelmsen, A.S.A. for breach of the agency contract, breach of fiduciary duty and negligence. While Plaintiffs only contracted with Barwil Turkey, Plaintiffs contend that all the named Barwil entities and Wilh. Wilhelmsen, A.S.A. are jointly and in solido liable to Plaintiffs, because "Barwil and Wilhelmsen all worked together in furtherance of the common goal, namely to increase Wilhelmsen's position as a global provider of maritime services," or alternatively the corporate veils of the Barwil entities should be pierced "rendering all of Wilhelmsen liable jointly and in solido." (First Supplemental and Amended Verified Complaint, ¶¶ VII(a) VIII(a)). All Defendants now move for dismissal for lack of personal jurisdiction, or alternatively, for forum non conveniens.
Plaintiffs named Wilh. Wilhelmsen ASA as an additional Defendant in Plaintiffs' "First Supplemental and Amended Verified Complaint," Doc. No. 22.
II. Legal Analysis
In admiralty cases, this court may exercise personal jurisdiction over a foreign defendant, "when (1) Louisiana could have acquired personal jurisdiction over the defendant on the same cause of action; and (2) the exercise of jurisdiction comports with the Due Process Clause of the Fourteenth Amendment." Adams v. Unione Mediterranea Di Sicurta, 220 F.3d 659, 667 (5th Cir. 2000). These two inquiries merge into one because Louisiana's long-arm statute permits jurisdiction conterminous with the scope of the Due Process Clause. Id.; LSA-R.S. 13:3201(B).The Due Process Clause permits the exercise of personal jurisdiction over a nonresident defendant when (1) that defendant has purposefully availed himself of the benefits and protections of the forum state by establishing 'minimum contacts' with the forum state and thus reasonably could anticipate being haled into court there; and (2) the exercise of jurisdiction over the defendant does not offend 'traditional notions of fair play and substantial justice.'" Latshaw v. Johnston, 167 F.3d 208, 211 (5th Cir. 1999), quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed.2d 95 (1945).
"Minimum contacts" can be established either through contacts sufficient to assert specific jurisdiction, or contacts sufficient to assert general jurisdiction. Alpine View Co. v. Atlas Copco AB, 205 F.3d 208, 215 (5th Cir. 2000).
Specific jurisdiction over a non-resident corporation is appropriate when that corporation has purposefully directed its activities at the forum state and the "litigation results from alleged injuries that 'arise out of or relate to' those activities." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985), quoting Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). Further, a single act may support specific jurisdiction where the act is directed at residents of the forum, and the cause of action relates to the act. Burger King, 471 U.S. at 476 n. 18.
On the other hand, general jurisdiction exists where a defendant's contacts with the forum state are substantial and "continuous and systematic," but unrelated to the plaintiff's cause of action. Central Freight Lines Inc. v. APA Transport Corp., 322 F.3d 376, 381 (5th Cir. 2003); Helicopteros, 466 U.S. at 415-16.
A. Barwil Universal/Turkey's Motion to Dismiss for lack of personal jurisdiction (1) Formation of Barwil Universal/Turkey as a joint venture between Universal Shipping and Barwil Oslo
As discussed later in the text of this Minute Entry, the court has concluded that it has general jurisdiction over Barwil Oslo, and its wholly owned subsidiary, Barwil Agencies N.A., whose principal office is located in New Orleans, Louisiana. ( See text infra, pp. 18-22).
Mr. Cevdet Basacik, a principal of Universal Shipping, testified that the shareholders of Universal Shipping were motivated to form a joint company (i.e., Barwil Turkey) with Barwil Oslo "to get more business." (Basacik Dep. at 130:14-24). He explained:
Q. Why did you perceive that going in this joint venture or entering into the relationship would garner more business?
A. The reason was that the Barwil Oslo, we knew that they were in contact with a lot of ship owners around the world, and through their companies around the world, they had a lot of business. And we thought that the — if we went and made a joint company with Barwil Oslo, then we would make use of this database of theirs and their customers, who are using them already would also bring us their business in Turkey.
(Basacik at 131).
The joint venture between Universal Denizelik and Barwil Oslo was created through a document called "Heads of Agreement," which sets forth that Barwil Oslo was the largest shareholder with 50% equity in Barwil Turkey, with the remaining 50% equity divided among four Turkish shareholders. ( See Plaintiffs' Exhibit 4, Heads of Agreement, dated in 1990). (2) Marketing Agreement between Barwil Universal/Turkey and Barwil Oslo
The court notes that according to the 1997 Wilhelmsen annual report, the 50% interest in Barwil Universal is owned by Wilhelmsen, not Barwil Oslo. ( See Wilh. Wilhelmsen Exhibit 13, 1997 Annual Report, p. 20).
The corporate representative of Wilhelmsen admitted that at one point Wilhelmsen had a direct ownership interest in Barwil Universal/Turkey and explained that this direct ownership in Barwil Universal/Turkey
gave Wilh. Wilhelmsen ASA, as it was probably named at the time, the . . . right to invest directly in . . . this company in Turkey. That was a . . . business opportunity that Barwil had . . . come forward with, because they were our arm when it comes to the agency business, and they said that they wanted to create a presence in Turkey. And then they came to us to undertake the investment.
. . .
So we had no direct dealings with our . . . agency interest in Turkey. All that was managed by Barwil Agencies.
(Galtung at 46-48).
If and when Wilhelmsen divested itself of this direct ownership in Barwil Universal is unclear from the record. The President and CEO of Barwil Oslo testified that "Barwil bought the joint ventures from the WW group in 2003/2004." (Tonsberg Dep. at 21-22, 25). When questioned as to why the 2003 Annual Report for Barwil Oslo did not list Barwil Universal as one of Barwil Oslo's investments, Mr. Tonsberg explained that "the Barwil Universal thing had not been concluded" yet. ( Id. at 29; see also Barwil Oslo Exhibit 6, Annual Report at n. 8).
The court further notes that in June 2004, Wilhelmsen made a $35,000,000 loan to Barwil Oslo. ( See Wilhelmsen Exhibit 4, Loan Agreement). The corporate representative of Wilhelmsen explained that the loan agreement "was a formalization of the financial flow of money between Wilhelmsen and Barwil Agencies," and part of the background for this loan agreement was the sale of "agency interests from Wilh. Wilhelmsen Oslo to Barwil Oslo." (Galtung Dep. at 21, 30-31).
Pursuant to a marketing agreement with Barwil Universal/Turkey, Barwil Oslo globally promotes Barwil Universal/Turkey's activities, and in return, Barwil Turkey reimburses "Barwil Oslo 10% of its gross agency revenue earned from appointments by non-Turkish principals, towards the marketing expenses of Barwil Oslo." ( See Plaintiffs' Exhibit 8, Marketing Agreement). Under the marketing agreement, Barwil Oslo agreed to "do all the coordination of production and distribution of brochures, port information booklets, directories and calendars for Barwil Universal." ( Id.; see also Plaintiffs' Exhibit 10, Port information booklet; Exhibit 11, "Barwil Services in Black Sea, etc." booklet; Exhibit 12, "Barwil Services in Region Mediterranean, Black Sea, etc." booklet; and Barwil Oslo's Exhibit 7, "Barwil Directory," listing contact information for Barwil Universal on page 263).
95% of Barwil Universal/Turkey's business involves liner service customers (ships that run on a regular schedule between designated ports) versus tramp customers (single port call). However, the fee Barwil Universal/Turkey pays Barwil Oslo for marketing primarily covers the tramp/tank customers, and not the liner customers. (Basacik Dep. at 213-14; Tonsberg Dep. at 130-31).
Mr. Bjorn Tonsberg, the President, CEO and corporate representative of Barwil Oslo, explained that under the marketing agreement, "Barwil Universal is allowed to use the Barwil logo, the Barwil branding, and the Barwil sales and marketing network to further and improve their business." (Tonsberg Dep. at 91). He described the Barwil logo as the white flag with the blue W. ( Id. at 107). And indeed, the business card of Mr. Basacik, one of the Turkish directors of Barwil Universal/Turkey, contains the white flag with the blue W. ( See Barwil Universal Exhibit 1, Mr. Basacik's business card). Mr. Basacik testified that it was the proposal of the Norwegian partners that Barwil Universal use such a format identifying Barwil Universal as a Wilh. Wilhelmsen company. (Basacik Dep. at 227-28).
Interestingly, the corporate representative of Wilhelmsen testified that Wilhelmsen is in the process of branding the various operating Wilhelmsen subsidiaries with the parent company logo (i.e., the white flag with the blue W). (Galtung Dep. at 51). He explained that reason for this:
Because Wilhelmsen is a well known shipping name, having been around for almost 150 years, it's a very reputable company and has a . . . high degree of identification and recognition in the global shipping scene; hence, we saw commercial value in branding the operating subsidiary closer with the Wilh. Wilhelmsen brand
( Id. at 52). When asked when that decision was made, Galtung responded:
Oh, that been a process, process discusses. Initially, I guess the operating companies got their own corporate identity, because they also solicited business from one of our — some of our competitors, because we were involved in more general shipping . . . The companies we previously may have competed with, we no longer do that.
. . .
So there's . . . not the same need to create a distance between the operating companies and the parent company. And hence, we . . . perceived that there would be value to [the subsidiaries] to be recognized as Wilh. Wilhelmsen companies.
( Id. at 52-53).
Mr. Tonsberg of Barwil Oslo further testified:
Q. Does the marketing agreement also require Barwil Oslo to promote or market the Barwil Universal office?
A. Barwil Oslo manages the whole Barwil brand as a franchise on the global basis. Barwil Universal would then, being a part of the Barwil directory, fall under that category.
Q. . . . Other than putting the Barwil Universal office in the Barwil directory, does Barwil Oslo perform any other marketing functions for Barwil Universal?
A. Not directly for Barwil-Barwil Universal. We sell the Barwil brand on the global basis; it is then up to the customers to pick and choose where they want to use the Barwil brand on a global basis.
Q. How do you go about selling the Barwil brand on a global basis?
A. By visiting customers; by doing image advertising, et cetera, et cetera; . . . try to create an awareness around their product; try to create some kind of recognition when you see the brand
(Tonsberg Dep. at 91-92).
Mr. Tonsberg admitted that in selling the Barwil brand in the market, all companies listed in the Barwil directory and on the Barwil website would automatically be included as part of the brand being sold. And Barwil Universal is listed in the directory and on the interactive website. (Tonsberg at 139-40). ( See Barwil Oslo's Exhibit 7, "Barwil Directory," listing contact information for Barwil Universal on page 263, and Plaintiffs' Exhibit 14, printout from barwil.com).
As to interactive Barwil website, Mr. Tonsberg of Barwil Oslo explained that Barwil Oslo "facilitated [its] presentation." (Tonsberg at 93-94). Further, through this website, a user sitting in New Orleans can click on about 90% of the various Barwil offices around the globe. A user can then use the hyperlink to send information to a particular Barwil office to obtain an accurate quote. ( Id. at 95 and Plaintiffs' Exhibit 14, printout from Barwil website).
While a user of the Barwil website can contact Barwil Universal, Mr. Leonard of Intermarine testified that he did not use this website to contact Barwil Universal in the formation of the subject agency contracts. (Leonard Dep. at 24-25). Accordingly, the fact that Barwil Oslo used its interactive website in the marketing of Barwil Universal does not factor into the court's determination of whether or not the court has specific jurisdiction over Barwil Universal.
Likewise, the fact that Barwil Oslo and/or Barwil Universal ran advertisements in international trade publications, such as Tradewinds and Fairplay, that were received by Intermarine in New Orleans, is also not considered in the determination of whether or not the court has specific jurisdiction over Barwil Universal, because there has been no showing that such advertisements played a part in the actual formation of the subject agency contracts between Plaintiffs and Barwil Universal.
Barwil Oslo's marketing of Barwil's Black Sea region (which included Barwil Turkey) included a personal call made in 1997 by Mr. Tor Anderson, the global vice president of sales for Barwil Oslo, and Mr. Darryl Ricard, the vice president of sales for Barwil N.A. (located in New Orleans), to the offices of Plaintiff Intermarine located in New Orleans. This marketing effort directly led Mr. John Leonard of Intermarine to contact Barwil Turkey, and after the exchange of verbal and/or written communication (including e-mails and faxes) between Intermarine (in New Orleans) and Barwil Turkey (in Turkey), two separate agency contracts were formed between Barwil Turkey and IMB, for the calls of the M/V INDUSTRIAL BRIDE and the M/V AMDERMA in Turkey. By entering into these agency agreements, there can be no question that Barwil Universal knew that it was affiliating itself with enterprises based primarily in New Orleans, Louisiana.
In arguing against specific jurisdiction, Barwil Universal/Turkey argues that it did not initially contact Intermarine, but that Intermarine first contacted Barwil Universal/Turkey. However, Intermarine (through Mr. Leonard) would not have contacted Barwil Universal but for the fact that Barwil Oslo and Barwil N.A. (on behalf of the entire Barwil network, which included Barwil Universal/Turkey) solicited Intermarine's business.
Mr. Leonard testified that Barwil sent him various advertising and promotional materials, including yearly copies of the Barwil agency directory. (Leonard Dep. at 10-11). The Barwil directory contained the contact information for Barwil Universal/Turkey. ( See Barwil Oslo Exhibit 7, Barwil Directory, p. 263). And, indeed, Mr. Leonard used the Barwil directory to locate the contact for Barwil Universal/Turkey and then send that contact the initial inquiry for an agency contract. (Leonard Dep. at 19).
This was IMB's first call to Turkey, and Mr. Leonard did not consider any other agencies other than Barwil explaining that "[t]here is a trust level, because it's Barwil. Darryl [Ricard] said any port, anywhere you don't have a standing agent, they will respond. We'll give you the information. That's why we're contacting Barwil Turkey." Id. at 19-25. Although Mr. Leonard contacted Barwil Turkey by using the Barwil directory that Mr. Ricard had given him, Mr. Ricard confirmed that his customers could contact him to arrange appointments in other countries. (Ricard at 51).
Mr. Leonard also testified that in the formation of an agency contract, the vessel operator first makes an inquiry, then the agent responds with a pro forma invoice (or estimate of what the costs will be at the port), and finally the vessel operator responds to that with a formal appointment or nomination. ( Id. at 39-40; see also Basacik Dep. at 181).
While the two vessels were in port in Turkey, there was exchange of "numerous correspondence" between Intermarine and Barwil Turkey. (Basacik Dep. at 184). Intermarine, on behalf of IMB, was invoiced by Barwil Universal in Louisiana for its services, as well as for lodging and discharging costs, port fees and expenses, and other associated costs with the voyages. And Intermarine paid Barwil Universal through Barwil N.A.
The parties' anticipation of an ongoing relationship is reflected in the fact that Plaintiffs and Barwil Universal/Turkey entered into agency contracts for two other vessels, the INDUSTRIAL CRESCENT and INDUSTRIAL CHALLENGER, in 2002. However, these particular agency contracts are not a part of this litigation.
The court concludes that Barwil Universal/Turkey, through Barwil Oslo acting as Barwil Universal's marketing agent, purposefully reached out to potential customers in New Orleans, including Plaintiffs Intermarine and IMB. As a result of the business solicitation made by Barwil Oslo (and its wholly owned subsidiary, Barwil N.A.) on behalf of Barwil Universal, the subject agency contracts between Plaintiffs and Barwil Universal/Turkey were formed. And because Plaintiffs claim that Barwil Universal/Turkey breached these agency contracts and Plaintiff have felt the harm in New Orleans, Plaintiffs' cause of action arises out of Barwil Universal's forum-related contacts.
Compare Central Freight Lines Inc. v. APA Transport Corp., 322 F.3d 376, 381-84 (5th Cir. 2003) (while APA, a New Jersey company, did not have substantial, continuous and systematic contacts with the State of Texas sufficient to support an exercise of general jurisdiction, it did appear to have contacts with the State of Texas related to the transaction giving rise to the specific cause of action that were sufficient to support specific jurisdiction).
In Central Freight Lines, the Defendant APA (a New Jersey freight delivery company) sent two representatives to meet with Plaintiff Central Freight Lines (CFL), a freight delivery company at its headquarters in Waco, Texas. "APA provided CFL with information about APA. It also obtained information about CFL with the hope of finding a partner in Texas to interline freight to the East Coast . . . [T]his meeting led the parties to negotiate and enter into their Interline Agreement. Furthermore, although the parties dispute[d] whether the formal negotiations took place in . . . Texas or . . . New Jersey, the record appears to indicate that all of the formal negotiations took place via telephone and written correspondence between the two parties from their respective headquarters." Id. at 382. Further, "by entering into the Interline Agreement, APA knew that it was affiliating itself with an enterprise based primarily in Texas." Id. See also, Guillot v. Southern Pacific Co., 287 F. Supp. 65, 67 (E.D.La. 1968) (Cassibry, J.) (quoting LSA-R.S. 13:3201: "[a] court may exercise personal jurisdiction over a nonresident, who acts directly or by agent, as to a cause of action arising from the nonresident's causing injury or damage in this state by an offense or quasi offense committed through an act or omission outside of the state if he regularly . . . solicits business . . . in this state").
Although Barwil Universal/Turkey has pointed out no "forum selection clause, . . . choice of law clause, or some other provision that could have put [Barwil Universal/Turkey] on specific notice that it might be amenable to suit in [Louisiana]" in the subject agency agreements, there is also no evidence that the subject agency agreements "contain any provision that would give [Barwil Universal/Turkey] reason to think that it could not be haled into court in [Louisiana] in the event that [Barwil Universal/Turkey] allegedly breached" the agency agreements with Plaintiffs. Central Freight Lines Inv. v. APA Transport Corp., 322 F.3d 376, 383 (5th Cir. 2003).
Further, Plaintiffs also assert claims of breach of fiduciary duty and negligence against Barwil Universal/Turkey based on Barwil Universal's alleged failure to communicate to Plaintiffs (in New Orleans) that suit had been filed against Plaintiffs in Turkey. "[W]hen a claim arises from a breach of fiduciary duty based on a failure to disclose material information, the fact that the [fiduciary] continually communicated with the forum while steadfastly failing to disclose material information shows the purposeful direction of material omissions to the forum state." Wien Air Alaska, Inc. v. Brandt, 193 F.3d 208, 213 (5th Cir. 1999).
Finally, with the Plaintiffs establishing minimum contacts, the burden shifts to defendant to show the assertion of jurisdiction would be unfair. Id. at 215. And "[t]o show that an exercise of jurisdiction is unreasonable once minimum contacts are established, the defendant must make a 'compelling case' against it. It is rare to say the assertion is unfair after minimum contacts have been shown." Id. (citations omitted).
"The interests to balance in this determination are the burden on the defendant having to litigate in the forum; the forum state's interests in the lawsuit; the plaintiff's interests in convenient and effective relief; the judicial system's interest in efficient resolution of controversies; and the state's shared interest in furthering fundamental social policies." Id.
Barwil Universal/Turkey claims that the assertion of personal jurisdiction would be unfair and unreasonable because it is a company formed under Turkish law and does all of its business in Turkey. Barwil Universal further contends that it would be unduly burdensome to force its witnesses to come to Louisiana to litigate a claim which relates only to alleged actions in Turkey, and that it would be irreparably prejudiced by its inability to compel Turkish witnesses (who are not its employees) to Louisiana.
Admittedly, litigation in the U.S. would place a burden on Barwil Universal/Turkey. "However, once minimum contacts are established, the interests of the forum and the plaintiff justify even large burdens on the defendant." Id. Moreover, Louisiana has an interest because the dispute involves Plaintiffs who both have their principal place of business in Louisiana. Resolving the conflicts in a light most favorable to the Plaintiffs, the court finds "no overwhelming burden to the defendant that outweighs the legitimate interests of the plaintiff and the forum state." Id. at 216.
At most, Barwil Universal/Turkey demonstrates an inconvenience which would be equally felt by Plaintiffs if they were forced to litigate in Turkey. Thus, the court concludes that the assertion of specific jurisdiction over Barwil Universal/Turkey is fair and reasonable.
See also court's rejection of Defendants' forum non conveniens argument, text infra, pp. 23-27.
Because the court will assert specific jurisdiction over Barwil Universal/Turkey, the court need not decide whether the court also should assert general jurisdiction over Barwil Universal/Turkey based on: (1) the additional agency contracts that Plaintiffs formed with Barwil Universal for the calls of the M/V INDUSTRIAL CRESCENT and INDUSTRIAL CENTURY in 2002; and/or (2) the purported joint venture status or alter ego relationship between Barwil Universal/Turkey and Barwil Oslo (Barwil Universal's major shareholder and marketing agent).
B. Re-urged Motion to Dismiss filed by Barwil Agencies (N.A.), Inc., Barwil Oslo, and Wilh. Wilhelmsen, A.S.A. for lack of personal jurisdiction (1) General jurisdiction over Barwil Agencies, N.A.
Because the court limited discovery up to this point to personal jurisdiction issues, the court will not consider, at this juncture, these Defendants' arguments that this court should now dismiss Plaintiff's substantive claims on the merits.
Defendants admit that the court has personal jurisdiction over Barwil Agencies, N.A., whose principal offices are located in New Orleans, Louisiana. (Defendants' Memo. at 3). Thus, the court need only decide whether it has personal jurisdiction over Barwil Oslo and Wilh. Wilhelmsen, A.S.A. (2) General jurisdiction over Barwil Oslo
Plaintiffs, as proponents of personal jurisdiction over Barwil Oslo and Wilhelmsen, have the burden of showing facts upon which such jurisdiction might be predicated. "As this case aptly demonstrates, facts going to the merits of the action are likely to surface in the context of trying to establish jurisdiction. 'To avoid precipitating too extensive an investigation of the merits at this stage of the litigation, only a prima facie showing is required on a jurisdiction motion.'" Hargrave v. Fibreboard Corp., 719 F.2d 1154, 1160-61 (5th Cir. 1983) (citation omitted, emphasis added).
Daryl Ricard, who was employed by Barwil N.A. from 1993-2003, and worked out of the New Orleans office, testified that he provided customers (including Intermarine) with a directory of Barwil offices throughout the world. (Ricard Dep. at 23, 45). Further, he marketed not only the agency services of Barwil N.A., but also those of the "entire Barwil network" which included the the affiliates listed in the Barwil directory. ( Id. at 22, 51). In marketing the services of Barwil companies (other than Barwil N.A.), Mr. Ricard would tell potential customers that they could contact him to arrange appointments in other countries. ( Id. at 51).
Mr. Ricard formerly worked for Intermarine. (Leonard Dep. at 6).
Important to the issue of what type of control Barwil Oslo wielded over Barwil N.A.'s marketing, Mr. Ricard explained that Barwil N.A. received some funding from Oslo for the marketing budget, and that he and other sales reps in the U.S. had some liaison and "regular contact" with Barwil Oslo. ( Id. at 62, 66-67). Mr. Ricard traveled to Oslo in 1994 or '95 to "visit headquarters and meet the superiors." ( Id. at 50). Further, Mr. Ricard had to coordinate his marketing activities under the direction of the vice president of sales in Oslo. ( Id. at 48). And while Mr. Ricard could not quote rates for any Barwil company other than the New Orleans office of Barwil North America, Mr. Ricard told Mr. Leonard of Intermarine that "he could get us the best rates through the Barwil group, and if we had any problems, to let him know, and he would contact and talk to Oslo." (Leonard Dep. at 34).
Mr. Ricard called on the Intermarine offices several times a year for specific marketing. ( Id. at 36-37). Sometime around 1997, Mr. Ricard, along with Mr. Anderson (Vice-President of sales for Barwil Oslo), called on James Leonard (Vice-President of Intermarine) to market or solicit the services of Barwil Agencies operating in such areas as Central America, Middle East and the Black Sea region, where Intermarine did not have existing agencies. ( Id. at 40-41, 52; see also Leonard Dep. at 7). While there was no specific mention of Turkey, the Black Sea region includes Turkey. (Ricard Dep. at 40, 56). And Mr. Ricard and Mr. Anderson were pointing out to Mr. Leonard that there are Barwil offices in these locations and they are listed in the Barwil directory for his use. ( Id. at 56).
Mr. Ricard explained that Mr. Anderson was in the United States to see U.S. customers. (Ricard Dep. at 52).
Mr. Leonard explained his relationship with Mr. Ricard and Barwil:
No matter what agent in the world, [Darryl Ricard] could take it up and handle it. In one meeting, we even laughed about "one call that's all," if we had a problem.
. . .
Darryl and — the Barwil group is well known. There is a trust level, because it's Barwil. Darryl said any port, anywhere you don't have a standing agent you can contact, they will respond. We'll give you the information. That's why we were contacting Barwil Turkey. We contacted Barwil in Saudi Arabia. There were other ports we went to, and it went like clockwork.
(Leonard Dep. at 10, 20-21).
To contact Barwil in Turkey, Mr. Leonard used the Barwil global directory that Ricard had given him. (Leonard Dep. at 21, 32). Mr. Leonard explained why he contacted Barwil Turkey for the M/V INDUSTRIAL BRIDGE and M/V AMDERMA:
All Defendants point out that the directory contains a disclaimer stating that "unless otherwise noted" all Barwil companies listed therein are separate legal entities subject to the laws of their respective jurisdictions. However, such a statement, standing alone, is not the basis upon which the court will determine, as a matter of law, whether or not the Barwil entities are indeed separate legal entities for personal jurisdiction or liability.
My instructions were to ports in general where we don't have an agent, inquire to Barwil, use them as an information source, get the information from them that you need or were asking for to formulate the rate.
. . .
I gave the orders or instructions to contact Barwil throughout where we didn't have a known agent. We didn't want to fool around with unknown agents. We went with Barwil because it's a large team.
(Leonard at 30-31).
Mr. Ricard admittedly did not have the authority to negotiate the terms of a contract between a shipowner and an overseas Barwil entity, such as Barwil Turkey. ( Id. at 53). However, he could act as a liaison between the parties "to facilitate the information flow" and he could make recommendations regarding disputes over billing, for instance. ( Id. at 55-56).
"Given the appropriateness of applying a less stringent standard for alter ego jurisdiction than for alter ego liability," the court finds that Plaintiffs have demonstrated that Barwil Oslo possessed and exercised sufficient coordination and control over the marketing efforts of Barwil N.A. (which, again, is a wholly owned subsidiary of Barwil Oslo located in New Orleans) to fuse the two entities for purposes of general jurisdiction. Hargrave v. Fibreboard Corp., 710 F.2d 1154, 1161 (5th Cir. 1983). Further buttressing the conclusion that this court has general jurisdiction over Barwil Oslo is the fact that Barwil Oslo pays the cost of Barwil's Regional Director for the Americas who works out of Barwil N.A.'s New Orleans office. (Tonsberg Dep. at 81).
(3) General jurisdiction over Wilh. Wilhelmsen A.S.A.
Sometime in 1996/1997, Barwil USA, Inc. and Wilhelmsen Lines USA, Inc. merged into one company called Wilh. Wilhelmsen USA, Inc., d/b/a Barwil Agencies N.A. and Wilh. Wilhelmsen Lines USA, Inc. (Tonsberg Dep. at 59-60). Upon completion of this merger, the stock of Wilhelmsen USA, Inc. was wholly owned by Wilhelmsen A.S.A. ( Id. at 60:5-9). However, in 2003/2004, the Wilhelmsenowned shares of all the regional Barwil offices were transferred to Barwil Oslo. ( Id. at 63-64). Thus, today Wilh. Wilhelmsen U.S.A., Inc., which does business in New Orleans, Louisiana as Barwil Agencies N.A., and actually owns property in New Orleans, is a wholly owned subsidiary of Barwil Oslo, which is a wholly owned subsidiary of Wilh. Wilhelmsen A.S.A. ( Id. at 53:2-6). Wilhelmsen A.S.A. and Barwil Oslo have corporate headquarters in the same building, and they have common officers and directors (Tonsberg Dep. at 26, 68; Galtung Dep. at 43-44), and common logos.
Again, the principal office of Barwil Agencies N.A. (also known as Wilhelmsen USA) is located in New Orleans, and Barwil Agencies N.A. admits that this court has personal jurisdiction over it.
See discussion of logos in fn. 8, supra.
Accordingly, based on the foregoing, the court concludes that Plaintiffs have also made a prima facie showing that this court has general jurisdiction over Wilh. Wilhelmsen A.S.A.
C. Forum non conveniens?
All Defendants alternatively move to dismiss this matter based on forum non conveniens. The "doctrine of forum non conveniens proceed[s] from [the] premise [that] . . . [i]n rare circumstances, federal courts can relinquish their jurisdiction in favor of another forum." Karim v. Finch Shipping Co., 265 F.3d 258, 268 (5th Cir. 2001), quoting Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 722, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996).
The doctrine of forum non conveniens "enables a court to decline to exercise jurisdiction if the moving party establishes that the convenience of the parties and the court and the interests of justice indicate that the case should be tried in another forum." Karim, 256 F.3d at 268.
In analyzing forum non conveniens in the international context, the court must: (1) first determine whether there exists an alternative forum; and (2) then determine which forum is best suited to the litigation. Id., quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 252 254 n. 22, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981).
In considering the first step, the court considers: (1) amenability of the defendant to service of process; and (2) availability of an adequate remedy in the alternative forum. Karim, 265 F.3d at 268 (citations omitted). Here, Turkey is an adequate alternative forum, so the court proceeds to the second step.
In performing the second step, the court considers whether "certain private and public interest factors weigh in favor of dismissal." Id. At the outset, the court acknowledges that there is ordinarily a strong presumption in favor of a plaintiff's choice of forum. Further, while a foreign plaintiff's choice deserves less deference, Piper Aircraft, 454 U.S. 235, 102 S.Ct. 252, 256, here, Plaintiff Intermarine is a Louisiana corporate citizen, and Plaintiff IMB is a Bahamian company with its principal place of business is in New Orleans. Thus, the court finds that Plaintiff's choice of forum may be overcome only when the private and public interest factors clearly point towards trial in the alternative forum.
The factors pertaining to the private interests of the litigants include the "relative ease of access to sources of proof; availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses; possibility of view of premises, if view would be appropriate to the action; and all other practical problems that make trial of a case easy, expeditious and inexpensive." Piper Aircraft, 102 S.Ct. at 241 n. 6, quoting Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508, 67 S.Ct. 828, 843, 91 L.Ed. 1067 (1947).
The public factors bearing on the question include the administrative difficulties flowing from court congestion; the "local interest in having localized controversies decided at home"; the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action; the avoidance of unnecessary problems in conflict of laws, or in the application of foreign laws; and the unfairness of burdening citizens in an unrelated forum with jury duty. Id, quoting Gilbert, 330 U.S. at 509, 67 S.Ct. at 843.
(1) Private Interest Factors
Regarding the relative ease of access to sources of proof, the private interests point in both directions. Defendants argue that documents and most witnesses are located in Turkey, and that third parties (such as the Turkish correspondents of the vessels' PI Clubs, and representatives of the former Daewoo distributor) who may be potential witnesses cannot be forced to testify in the United States. Further, Defendants contend that discovery here would not be enabled by the Hague Evidence Convention because Turkey is not a signatory. Barwil Universal/Turkey also argues "there has been no showing that enforcement of a U.S. judgment in Turkey would be possible."
But Plaintiffs argue because Barwil Universal was properly served through the Hague Convention and has appeared in this action, the enforceability of a potential judgment is not at issue. Plaintiffs also contend that for purposes of this litigation, the overwhelming majority of documents are in English, all the key players speak English, the Plaintiffs themselves are located in New Orleans, the Plaintiffs' witnesses and documents are in New Orleans, and Barwil N.A. is New Orleans.
The court concludes that whichever the forum, some witnesses will have to travel substantial distances. Further, for any witness who is beyond the reach of compulsory process and unwilling to testify here, this court will accept such a witness' testimony through deposition or other available means.
There is no issue as to view of premises.
(2) Public Interest Factors
The focus of this litigation are the agency agreements between Plaintiffs and Barwil Universal/Turkey. These agency contracts were formed through communication of the Plaintiffs located in New Orleans on the one hand, and Barwil Universal/Turkey located in Turkey. Barwil Universal/Turkey's alleged breach of those contracts, as well as its alleged breach of fiduciary duty, resulted in harm felt by Plaintiffs in New Orleans. Further, the court finds that whether Barwil Universal/Turkey acted outside the scope of these agency agreements or breached its fiduciary duties may be determined by the court's application of federal/Louisiana law. Thus, Louisiana has a strong local interest in the litigation, and there are no administrative difficulties associated with having this non-jury matter tried in this court.
Even if the court would have to apply Turkish law to the substantive claims of this litigation, "the need to apply foreign law is not alone sufficient to dismiss under the doctrine of foreign non conveniens." R. Maganlal Co. v. M.G. Chemical Co., Inc, 942 F.2d 164, 169 (2nd Cir. 1991).
The court concludes that Defendants have failed to prove that the result of the balancing of factors relevant to both private and public interests strongly favors Turkey, the alternative forum. Thus, this court is the appropriate forum for this case.
III. Conclusion
For the reasons set forth above,
IT IS ORDERED that the "Motion to Dismiss for Lack of In Personam Jurisdiction, and Alternatively for Dismissal on Grounds of Forum Non Conveniens" filed by Defendant, Barwil Universal Denizcilik ve Tasimacilik, be and is hereby DENIED; and
IT IS FURTHER ORDERED that the "Reurged Motion to Dismiss" filed by Defendants, Barwil Agencies (N.A.), Inc., Barwil Agencies, A.S., and Wilh. Wilhelmsen, A.S.A., be and is hereby DENIED.