Capital Currency Exchange, N.V. v. National Westminster Bank PLC

• Citation: 155 F.3d 603
• Decision Date: 16 September 1998
• Docket Number: Docket No. 97-9228
• Parties: 1998-2 Trade Cases P 72,281 CAPITAL CURRENCY EXCHANGE, N.V., doing business as Chequepoint USA and Chequepoint Worldcash, Inc., Plaintiffs-Appellants, v. NATIONAL WESTMINSTER BANK PLC, Barclays Bank Plc, Hamish Martin Vincent Gray, Lord Alexander Of Weedon And John Martin Taylor, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

Page 603

155 F.3d 603

1998-2 Trade Cases P 72,281

CAPITAL CURRENCY EXCHANGE, N.V., doing business as Chequepoint USA and Chequepoint Worldcash, Inc. Plaintiffs-Appellants, v. NATIONAL WESTMINSTER BANK PLC, Barclays Bank Plc, Hamish Martin Vincent Gray, Lord Alexander Of Weedon And John Martin Taylor, Defendants-Appellees.

Docket No. 97-9228.

United States Court of Appeals Second Circuit.

Argued April 1, 1998.

Decided Sept. 16, 1998.

Jeffrey I. Zuckerman, Curtis, Mallet-Prevost, Colt & Mosle, Washington, DC, for Appellants.

Thomas P. Ogden, Davis Polk & Wardwell, New York City, (John J. Clarke, Jr., Barbara D. Diggs, of counsel), for Appellees National Westminster Bank PLC, Hamish Martin Vincent Gray and Lord Alexander of Weedon.

Philip L. Graham, Jr., Sullivan & Cromwell, New York City, (John W. Dickey, Michael B. Miller, Stephanie G. Wheeler, of counsel), for Appellees Barclays Bank PLC and John Martin Taylor.

Before: McLAUGHLIN and PARKER, Circuit Judges, and EGINTON, District Judge. ^*

McLAUGHLIN, Circuit Judge:

BACKGROUND

Capital Currency Exchange, N.V. ("CCE"), is a financial company organized under the laws of the Netherlands Antilles. CCE has a number of affiliates, including Chequepoint Worldcash, Inc. ("Worldcash"), a New York corporation, and Chequepoint (UK) Ltd. ("Chequepoint UK"), a British Virgin Islands company that transacts business in Great Britain.

CCE and its affiliates are engaged principally in two kinds of international financial transactions: (1) retail currency exchange, e.g., changing pounds to dollars for tourists; and (2) money transfers, e.g., wiring money from the United States to England.

Barclays Bank PLC ("Barclays UK") and National Westminster Bank PLC ("NatWest UK") are English corporations. As full-service banks, Barclays UK and NatWest UK offer currency exchange and money transfer services to their customers.

CCE and its affiliates had a longstanding banking relationship with Barclays UK. In 1991, CCE, on behalf of Worldcash, sought a New York State money transmission license. To qualify for this license, Worldcash had to post a $500,000 bond in favor of the New York State banking authorities. CCE arranged with Barclays UK's New York office to issue an irrevocable letter of credit as security for the bond. This letter of credit was payable in New York and expressly was governed by New York law. The letter of credit, however, named Barclays UK's London office as the issuer.

In May 1995, for reasons that the parties hotly dispute, Barclays UK told CCE to find another banker. Barclays UK claims that it discovered Chequepoint UK's complicity in a check kiting scheme, and decided to end its relationship with CCE and its affiliates. CCE counters that Barclays UK wanted to use a trademark that was similar to one owned by CCE, and when CCE objected, Barclays UK set out to end their relationship.

Whatever the reason, CCE began negotiating with NatWest UK in July 1995 to establish a new banking relationship. In August 1995, NatWest UK declined to provide CCE with banking services. The reasons for NatWest UK's refusal are disputed. At the time, NatWest UK attributed its refusal to the fact that: (1) NatWest UK and Chequepoint UK were competitors in the money transfer business; and (2) Chequepoint UK had misrepresented facts about NatWest UK's money transfer services to consumers. NatWest UK now claims that its refusal was based on information that led it to believe that CCE and Chequepoint UK were involved in money laundering. CCE maintains that NatWest UK and Barclays UK conspired to drive CCE out of the money transfer business by depriving it of banking services.

On August 23, 1996, CCE and Worldcash, but not Chequepoint UK, brought suit in the United States District Court for the Southern District of New York (Stanton, J.). The suit named as defendants: (1) NatWest UK; (2) Hamish Gray, the CEO of NatWest UK On November 6, 1996, defendants moved to dismiss the complaint: (1) for failure to state a claim; and (2) under the forum non conveniens doctrine. On August 28, 1997, Judge Stanton granted defendants' motion solely on forum non conveniens grounds. Judge Stanton found that: (1) antitrust suits are subject to the forum non conveniens doctrine; (2) England is an adequate forum for plaintiffs' suit; and (3) the public and private interests involved in this suit favor litigation in England.

(3) Lord Alexander of Weedon, the Chairman of NatWest UK's Board of Directors; (4) Barclays UK; and (5) John Martin Taylor, the CEO of Barclays UK. The complaint alleged that NatWest UK, Barclays UK, and the individual defendants violated Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 & 2, by denying banking services to CCE and its affiliates. The complaint also alleged four common law causes of action against Barclays UK and Taylor arising out of the termination of the CCE-Barclays UK banking relationship.

CCE and Worldcash now appeal, arguing that all three of Judge Stanton's conclusions were erroneous.

DISCUSSION

I. Application of Forum Non Conveniens to Antitrust Suits

CCE and Worldcash posit that an antitrust suit cannot be dismissed under the forum non conveniens doctrine. We disagree.

Judge Stanton's conclusion that an antitrust suit can be dismissed under the forum non conveniens doctrine is a conclusion of law that we review de novo. See Murray v. British Broad. Corp., 81 F.3d 287, 292 (2d Cir.1996).

The common law has long permitted dismissal of suits where jurisdiction and venue are proper, but another forum is substantially more convenient. See Piper Aircraft Co. v. Reyno, 454 U.S. 235, 248 n. 13, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981); Canada Malting Co. v. Paterson S.S., 285 U.S. 413, 52 S.Ct. 413, 76 L.Ed. 837 (1932); Blair, The Doctrine of Forum Non Conveniens in Anglo-American Law, 29 Colum. L.Rev. 1 (1929). Despite the doctrine's long history, the Supreme Court did not explicitly recognize the applicability of forum non conveniens in federal question cases until 1947. See Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S.Ct. 839, 91 L.Ed. 1055 (1947). Even after Gilbert, however, the doctrine did not apply in cases brought under certain federal statutes. See, e.g., Baltimore & Ohio R.R. Co. v. Kepner, 314 U.S. 44, 62 S.Ct. 6, 86 L.Ed. 28 (1941) (Federal Employers Liability Act suits not subject to dismissal in favor of more convenient forum), overruled by Ex parte Collett, 337 U.S. 55, 69 S.Ct. 944, 93 L.Ed. 1207 (1949).

In United States v. National City Lines, 334 U.S. 573, 596, 68 S.Ct. 1169, 92 L.Ed. 1584 (1948) ("National City I "), the Supreme Court held that forum non conveniens could not be used to transfer an antitrust suit to a more convenient forum within the United States. In National City I, the government sued a number of corporations under Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 & 2, alleging that the defendants conspired to monopolize public transportation in a number of cities. The government brought the suit in Los Angeles, in what was then the Southern District of California.

Defendants moved to dismiss on the ground that the Northern District of Illinois was a more convenient forum. The district court granted defendants' motion and dismissed the complaint without prejudice to re-filing in the Northern District of Illinois. See United States v. National City Lines, 7 F.R.D. 456, 466 (S.D.Cal.1947).

On direct appeal pursuant to 15 U.S.C. § 29, the Supreme Court reversed, holding that forum non conveniens could not be used to dismiss a suit brought under the Sherman Act. See National City I, 334 U.S. at 578, 68 S.Ct. 1169. The Court's conclusion was based on the "special venue" provision in Section 12 of the Clayton Act, which liberalized the venue provisions of the Sherman Act. See 15 U.S.C. § 22 (Clayton Act); 15 U.S.C. §§ 5, 7 (Sherman Act). Section 12 of the Clayton Act permits a Sherman Act claim to be brought "in any district wherein [a defendant corporation] may be found or transacts business." 15 U.S.C. § 22; see Eastman Kodak Co. v. Southern Photo Materials The National City I Court reasoned that: (1) Section 12 of the Clayton Act demonstrated a congressional intent to expand the possible fora available to antitrust plaintiffs; and (2) application of forum non conveniens in Sherman Act cases would be inconsistent with that intent. "To have broadened the choice of venue for the reasons that brought about that action [namely, to prevent wealthy corporate defendants from transferring suits to distant and expensive venues], only to have it narrowed again by application of the vague and discretionary power comprehended by forum non conveniens would have been incongruous, to say the least." National City I, 334 U.S. at 581, 68 S.Ct. 1169.

Co., 273 U.S. 359, 372-73, 47 S.Ct. 400, 71 L.Ed. 684 (1927).

In September 1948, shortly after National City I was decided, Congress enacted 28 U.S.C. § 1404(a), which provides that "[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." Section 1404(a) thus supplanted the common law doctrine of forum non conveniens for transfers between United States district courts. See Fitzgerald v. Westland Marine Corp., 369 F.2d 499, 501 n. 3 (2d Cir.1966). Section 1404(a) does not apply in cases where the purportedly more convenient forum is not a United States district court. In such cases, almost always involving foreign countries, the common law doctrine of forum non conveniens still governs. See Piper, 454 U.S. at 253, 102 S.Ct. 252; Fitzgerald, 369 F.2d at 501 n. 3. Section 1404(a) cases are transferred to a more convenient federal forum; forum non conveniens cases are dismissed in anticipation of re-filing in a more convenient foreign forum. See 15 Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3828, at 278-79...