675 F.3d 163 (2nd Cir. 2012), 10-3607-cv, Bigio v. The Coca-Cola Co.

Docket Nº:10-3607-cv.
Citation:675 F.3d 163
Opinion Judge:LIVINGSTON, Circuit Judge:
Party Name:Raphael BIGIO, Bahia Bigio, Ferial Salma Bigio, B. Bigio & Company, Plaintiffs-Appellants, v. The COCA-COLA COMPANY, The Coca-Cola Export Corporation, Defendants-Appellees.
Attorney:Nathan Lewin (Alyza D. Lewin, Lewin & Lewin, LLP, Washington, DC, Sherrie Savett, Arthur Stock, Douglas M. Risen, Shoshana Savett, Berger & Montague, PC, Philadelphia, PA, on the brief), Lewin & Lewin, LLP, Washington, DC, for Plaintiffs-Appellants. Richard A. Cirillo (Paul A. Straus, Kristi E. J...
Judge Panel:Before: JACOBS, Chief Judge, CABRANES and LIVINGSTON, Circuit Judges.
Case Date:March 19, 2012
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit
 
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675 F.3d 163 (2nd Cir. 2012)

Raphael BIGIO, Bahia Bigio, Ferial Salma Bigio, B. Bigio & Company, Plaintiffs-Appellants,

v.

The COCA-COLA COMPANY, The Coca-Cola Export Corporation, Defendants-Appellees.

No. 10-3607-cv.

United States Court of Appeals, Second Circuit.

March 19, 2012

Argued: Nov. 17, 2011.

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[Copyrighted Material Omitted]

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Nathan Lewin (Alyza D. Lewin, Lewin & Lewin, LLP, Washington, DC, Sherrie Savett, Arthur Stock, Douglas M. Risen, Shoshana Savett, Berger & Montague, PC, Philadelphia, PA, on the brief), Lewin & Lewin, LLP, Washington, DC, for Plaintiffs-Appellants.

Richard A. Cirillo (Paul A. Straus, Kristi E. Jacques, Kana A. Ellis, on the brief), King & Spalding LLP, New York, NY, for Defendants-Appellees.

Before: JACOBS, Chief Judge, CABRANES and LIVINGSTON, Circuit Judges.

LIVINGSTON, Circuit Judge:

This case, here on its third visit to this Court, asks us to determine whether Plaintiffs-Appellants (" Plaintiffs" ) have stated a cause of action against two American corporations that, in 1994, acquired an interest in an Egyptian corporation which allegedly wrongfully possesses property expropriated from Plaintiffs in Egypt by the Nasser regime in the 1960s. For the reasons that follow, we hold that they have not. We therefore affirm the judgment of the District Court dismissing the complaint for failure to state a claim.

I. BACKGROUND

A. Factual Allegations

For the events giving rise to this case we must look back nearly a century, to 1929, when Raphael Nessim Bigio, father-in-law of Plaintiff Bahia Bigio and grandfather of Plaintiffs Raphael Bigio and Ferial Salma Bigio, purchased real property in

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the Egyptian city of Heliopolis, a suburb of Cairo. 1 He made additional purchases of land in 1942 and 1946. Beginning in the 1940's, the Coca-Cola Company (" Coca-Cola" ) leased land and buildings from Raphael Nessim Bigio's family (" the Bigios" or " the Bigio family" ) to establish its first bottling plant in Egypt. The Bigios' manufacturing companies, R.N. Bigio & Co. and B. Bigio & Co., also manufactured various products for Coca-Cola, including serving trays, bottle coolers, and bottle caps.

Beginning in 1962, the Egyptian government sequestered and then nationalized real property, business entities, and chattels belonging to Raphael Nessim Bigio's son Josias Bigio and his family, including the land on which Coca-Cola operated its bottling plant, the Bigios' factory equipment, and the manufacturing companies R.N. Bigio & Co. and B. Bigio & Co. Josias Bigio and his family were Jewish, and Plaintiffs allege that the Egyptian government's sequestration and nationalization of the Bigios' property were the product of " the anti-Jewish policies of its then President Gamal Abdel Nasser." Am. Cmplt. at ¶ 17. At first, the Bigio family's real property was administered directly by the Egyptian Ministry of Finance. It later came into the possession of the Misr Insurance Company, an entity wholly owned by the Egyptian government. The businesses, factories, and equipment formerly possessed by the Bigios were consolidated with other nationalized bottling companies into a single entity doing business under the name " El Nasr Bottling Company" (" ENBC" ), which operated on the real property formerly held by the Bigios.2 Plaintiffs allege that Coca-Cola knew at the time that the property at issue had been unlawfully taken and that it nevertheless continued to do business with ENBC. In 1965, the Bigio family was expelled from Egypt. They eventually settled in Canada.

In 1979, Plaintiff Raphael Bigio returned to Egypt for a period of time. While there, he obtained decrees from the Egyptian Ministry of Finance to the effect that the land belonging to Bahia Bigio, Raphael Bigio's mother, " had never been legally sequestered or nationalized and accordingly remained" hers, and that the Bigios' other real property " had been sequestered pursuant to an invalid [d]ecree, and must be returned to the heirs of Josias Bigio." Am. Cmplt. at ¶ 31. Although the Egyptian Ministry of Finance ordered the Misr Insurance Company " to return possession of the property to the Bigios," Am. Cmplt. at ¶ 32, the company refused to do so. Efforts in the Egyptian legal system to enforce the Ministry of Finance's decrees have thus far proven unsuccessful.

In 1993, the Egyptian government announced the privatization of ENBC. In

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February 1994, Raphael Bigio notified Coca-Cola of the Bigio family's claims to certain property currently in the possession of ENBC. Officers of Coca-Cola scheduled a meeting with Raphael Bigio, but before the scheduled date of the meeting Coca-Cola closed on a transaction whereby it acquired an ownership interest in ENBC. Specifically, a consortium including two Coca-Cola subsidiaries acquired a 42% interest in ENBC, and a joint venture between Coca-Cola and MAC Beverages acquired another 53%. The total price paid for ENBC by all buyers was $96 million.3 Sometime after the close of the transaction, ENBC was renamed the Coca-Cola Bottling Company of Egypt (" CCE" ).

Since 1994, Coca-Cola has continued at all times to hold an ownership interest in CCE. CCE has constructed additional buildings on the land formerly owned by the Bigio family. CCE continues to bottle Coca-Cola products in Egypt, and Coca-Cola profits from sales of syrup and licensing agreements to CCE. Coca-Cola also profits from sales of CCE stock, selling a 5% interest in CCE for $24 million in 1999.

B. Procedural History

The Plaintiffs are Raphael Bigio (Ferial Salma Bigio's brother, Josias Bigio's son, and Raphael Bigio's grandson), Ferial Salma Bigio (Raphael Bigio's sister, Josias Bigio's daughter, and Raphael Nessim Bigio's granddaughter), Bahia Bigio (Josias Bigio's wife and Raphael Bigio and Ferial Salma Bigio's mother), and B. Bigio & Co. (a corporation allegedly owned by the foregoing " Individual Plaintiffs" ). The Individual Plaintiffs claim to be the present owners of property taken from the Bigio family in the 1960s or of interests therein. In 1997, Plaintiffs filed a complaint in the United States District Court for the Southern District of New York. They brought suit against Coca-Cola and a wholly-owned subsidiary of Coca-Cola, the Coca-Cola Export Corporation 4 (collectively " Defendants" ), but not against CCE, the Misr Insurance Company, or the Arab Republic of Egypt. Defendants moved to dismiss the complaint for, inter alia, lack of subject matter jurisdiction, or in the alternative for summary judgment. The District Court (Martin, J. ) granted the motion to dismiss on the grounds that jurisdiction under the Alien Tort Statute (" ATS" ), 28 U.S.C. § 1350, was lacking and that the act of state doctrine barred the exercise of jurisdiction under 28 U.S.C. § 1332. Bigio v. Coca-Cola Co., No. 97 Civ. 2858(JSM), 1998 WL 293990 (S.D.N.Y. June 5, 1998). Plaintiffs appealed to this Court. We agreed that jurisdiction was unavailable under the ATS but reversed the District Court's determination that jurisdiction under 28 U.S.C. § 1332 was precluded by the act of state doctrine.

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Bigio I, 239 F.3d at 443-44. We remanded for determination as to whether " principles of international comity" prohibited jurisdiction over the case. Id. at 456.

On remand, the District Court (Jones, J. ) held that international comity and the forum non conveniens doctrine required dismissal of the case. Bigio v. Coca-Cola Co., No. 97 Civ. 2858(BSJ), 2005 WL 287397, at *7 (S.D.N.Y. Feb. 3, 2005). We reversed the District Court on both grounds and remanded for further proceedings. Bigio v. Coca-Cola Co., 448 F.3d 176, 178-80 (2d Cir.2006) ( " Bigio II " ).

In August 2009, Plaintiffs filed an Amended Complaint alleging the following five causes of action: 1) " unlawful taking and exclusion of plaintiffs," 2) trespass, 3) conversion, 4) civil conspiracy and aiding and abetting,5 and 5) unjust enrichment. Defendants moved to dismiss under Fed.R.Civ.P. 12(b)(6) for failure to state a claim and on the theory that the claims were time-barred, and Plaintiffs cross-moved for summary judgment on the issue of liability. The District Court (Jones, J. ) granted Defendants' motion and denied Plaintiffs' as moot. Bigio v. Coca-Cola Co., No. 97 Civ. 2858(BSJ), 2010 WL 3377503, at *9 (S.D.N.Y. Aug. 23, 2010).

In the District Court's view, the first count was " substantially similar" to the ATS claim that appeared in the original Complaint, the dismissal of which was affirmed by this Court in Bigio I. Id. at *2. Turning to the trespass claim, the District Court held that Egyptian law applied, since the real property in question is in Egypt. Id. at *3-4. Comparing the affidavits on Egyptian law submitted by the parties, the District Court credited the opinion of Defendants' expert (that occupying real property pursuant to a " claim of right" precludes liability for trespass under Egyptian law) over the opinion of Plaintiffs' expert (that liability for trespass attached because Defendants " knew or should have known that ownership of the land was in dispute" ). Id. at *4-5 (internal quotation mark omitted). The District Court offered two reasons for this choice: 1) only Defendants' expert is licensed to practice law in Egypt; and 2) Plaintiffs' expert offered a " conclusory, partisan statement" that Defendants committed trespass " despite the existence of a lease or other claim of right," while Defendant's expert provided a " succinct statement of Egyptian law." Id. at *5. Noting that the Amended Complaint admits that " the Bigios' properties were sold or leased to the Defendants," the District Court held that Defendants occupied the real property in question pursuant to a claim of right, and...

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