981 F.2d 1345 (1st Cir. 1992), 92-1050, Mercier v. Sheraton Intern., Inc.

Docket Nº:92-1050.
Citation:981 F.2d 1345
Party Name:George E. MERCIER and Susan Y. Mercier, Plaintiffs, Appellants, v. SHERATON INTERNATIONAL, INC., a/k/a ITT-Sheraton International, Inc., Defendant, Appellee.
Case Date:December 22, 1992
Court:United States Courts of Appeals, Court of Appeals for the First Circuit
 
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Page 1345

981 F.2d 1345 (1st Cir. 1992)

George E. MERCIER and Susan Y. Mercier, Plaintiffs, Appellants,

v.

SHERATON INTERNATIONAL, INC., a/k/a ITT-Sheraton

International, Inc., Defendant, Appellee.

No. 92-1050.

United States Court of Appeals, First Circuit

December 22, 1992

Heard June 3, 1992.

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[Copyrighted Material Omitted]

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James M. Hartman with whom Mary Ann Snyder and Harris, Beach & Wilcox, Rochester, NY, were on brief, for plaintiffs, appellants.

David S. Mortensen with whom Lydia J. Luz and Tedeschi, Grasso & Mortensen, Boston, MA, were on brief, for defendant, appellee.

Before BREYER, Chief Judge, O'SCANNLAIN, [*] Circuit Judge, and CYR, Circuit Judge.

CYR, Circuit Judge.

Susan and George Mercier sued Sheraton International, Inc. ["Sheraton"] for breach of contract and intentional interference with contractual relations in connection with an alleged agreement to establish and operate a gambling casino at the Istanbul Sheraton Hotel. Sheraton moved for dismissal on the ground of forum non conveniens, asserting that Turkey is the more appropriate forum. The district court ordered dismissal. Mercier v. Sheraton Int'l, Inc., 744 F.Supp. 380 (1990) ["Mercier I "]. On appeal, we concluded that several factors relevant to the forum selection inquiry had been misapplied. Mercier v. Sheraton Int'l, Inc., 935 F.2d 419 (1st Cir.1991) ["Mercier II "]. On remand, the district court again ordered dismissal, imposing several conditions designed to ensure the availability of an adequate forum in Turkey.

I

BACKGROUND

In approximately 1982, George Bauer, general manager of the Istanbul Sheraton Hotel, began negotiations with Susan Mercier

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for the establishment and operation of a gambling casino in the hotel. At the time, Mercier, an American citizen, was operating a cruise ship casino. As foreigners doing business in Turkey were required to have Turkish partners, Bauer introduced Mercier to Fethi Deliveli, a Turkish national. Ultimately, Mercier and her father, George Mercier, formed a partnership with Deliveli and became stockholders in Lidya Turistik Tesisler Isletmesi ["Lidya"], a Deliveli family corporation from which the Merciers acquired the right to operate the proposed casino at the Istanbul Sheraton.

The casino negotiations continued throughout 1982 and 1983, eventually resulting in the execution of an undated Memorandum of Understanding among Bauer, Deliveli and the Merciers, whereby the Merciers and Deliveli would rent casino space in the Istanbul Sheraton. The agreement was made subject to the partners' procurement of all necessary permits from the Turkish government by the Merciers, and to the approval of Sheraton Corporation, Sheraton's Boston-based parent. Sheraton asserts that the Turkish permits were never obtained and that the approval of its parent corporation was never given; the Merciers disagree.

In March 1984, Bauer and Deliveli (representing Lidya) signed a Protocol entitling Lidya to install slot machines in the Sheraton casino space. The Protocol was conditioned on the Merciers' participation in Lidya and on the approval of gambling by the Turkish "owning corporation" from which the hotel premises were leased by Sheraton. The Protocol prescribed that its interpretation would be "governed by Turkish laws," and designated Istanbul as the proper forum for the litigation of disputes arising thereunder. Sheraton now contends that the Protocol was intended to supersede the earlier Memorandum of Understanding, and that the Protocol never went into effect because it was never approved by the Turkish "owning corporation."

Sometime during the summer of 1986, following the collapse of the Mercier-Deliveli partnership, the Merciers reconveyed their Lidya shares to Deliveli in return for 101 slot machines and accession to the rights of Lidya and Deliveli under their various agreements with Sheraton. The Merciers then began negotiations with Leisure Investments, P.L.C. ["Leisure"], with a view to forming a new partnership to operate the casino. At about this time, Susan Mercier left Turkey in the aftermath of an altercation with a Turkish national which eventually led to the issuance of a warrant for her arrest. Leisure broke off negotiations with the Merciers and, in October 1987, Leisure's wholly-owned subsidiary made a separate agreement with Sheraton, pursuant to which the Leisure subsidiary commenced casino operations at the Istanbul Sheraton in 1988.

II

PRIOR PROCEEDINGS

The Merciers filed the present action against Sheraton in the United States Court for the District of Massachusetts. 1 Sheraton answered and moved to dismiss on the ground of forum non conveniens, contending that the Republic of Turkey was the proper forum. In Mercier I, the district court concluded, based on the affidavit of Dr. Yucel Sayman, a Turkish law professor and attorney, that the Merciers would be able to raise their claims in the Turkish courts and that--despite Susan Mercier's legal entanglements--Turkey would provide an "adequate available forum." 744 F.Supp. at 384-85. The court further found that various "public interest" factors militated in favor of a Turkish forum, including the difficulty of applying Turkish law, the relative paucity of ties between the parties' dispute and the Commonwealth of Massachusetts, and the congestion in the federal district court docket. Id. at 386.

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In Mercier II, we concluded that the Sayman affidavit was too incomplete and conclusory to meet Sheraton's burden of proving that the Turkish courts were an available "alternative forum" for the Mercier claims, 935 F.2d at 425-26 and n. 7. Moreover, assuming Turkey's availability as an alternative forum, we concluded that the adequacy of the Turkish forum had not been demonstrated, in that (1) the Merciers' tort claims might be time-barred under Turkey's one-year statute of limitations; and (2) Susan Mercier's testimony--which the district court considered "essential"--might not be received. Id. at 426. Finally, we noted several deficiencies in the district court's forum selection analysis. We noted in particular the apparent failure to compare the docket congestion in Turkey with the docket congestion in the forum and the failure to consider the potential interests of the United States, as well as the District of Massachusetts, in affording a forum for the litigation. See generally id. at 427-430.

We did not suggest that dismissal was foreclosed on remand, see id. at 430, but rather that the forum determination should be made only after further findings of fact. See generally Baris v. Sulpicio Lines, Inc., 932 F.2d 1540, 1552 (5th Cir.), cert. denied, --- U.S. ----, 112 S.Ct. 430, 116 L.Ed.2d 449 (1991) (citing In re Air Crash Disaster Near New Orleans, Louisiana, 821 F.2d 1147, 1166 n. 32 (5th Cir.1987) (en banc)) (where district court sets forth insufficient facts in support of its forum determination, appellate court should not address the issue, but remand to district court to "begin afresh"); accord, Lacey v. Cessna Aircraft Co., 862 F.2d 38, 43 (3d Cir.1988); La Seguridad v. Transytur Line, 707 F.2d 1304, 1308-10 (11th Cir.1983). On remand, the district court received further evidence, including detailed supplemental affidavits from Sayman as well as several experts hired by the Merciers. The second district court dismissal order was conditioned on (1) acceptance of jurisdiction by the Turkish courts; (2) Sheraton's submission to Turkish jurisdiction; (3) Sheraton's waiver of any statute of limitations defense, and acceptance of the waiver by the Turkish court; and (4) Sheraton's agreement to satisfy any Turkish court judgment.

III

DISCUSSION

The doctrine of forum non conveniens permits discretionary dismissals on a "case by case" basis, Royal Bed & Spring Co. v. Famossul Industria E Comercio de Moveis Ltda., 906 F.2d 45, 47 (1st Cir.1990), where an alternative forum is available in another nation which is fair to the parties and substantially more convenient for them or the courts. Howe v. Goldcorp Invest., Ltd., 946 F.2d 944, 947 (1st Cir.1991), cert. denied, --- U.S. ----, 112 S.Ct. 1172, 117 L.Ed.2d 418 (1992). The application of the doctrine of forum non conveniens is committed to the sound discretion of the trial court, Piper Aircraft Co. v. Reyno, 454 U.S. 235, 257, 102 S.Ct. 252, 266, 70 L.Ed.2d 419 (1981), whose decision will not be reversed absent a "clear abuse of discretion." Id.; see also Howe, 946 F.2d at 951; Royal Bed & Spring Co., 906 F.2d at 47-48. But since there is a strong presumption in favor of the plaintiff's forum choice, id. at 241, 102 S.Ct. at 258, the defendant must bear the burden of proving both the availability of an adequate alternative forum, see Tramp Oil & Marine, Ltd. v. M/V Mermaid I, 743 F.2d 48, 50 (1st Cir.1984), and the likelihood of serious unfairness to the parties in the absence of a transfer to the alternative forum, Koster v. Lumbermens Mut. Cas. Co., 330 U.S. 518, 524, 67 S.Ct. 828, 831, 91 L.Ed. 1067 (1947); Howe, 946 F.2d at 950 (citing Piper Aircraft, 454 U.S. at 259, 102 S.Ct. at 267).

  1. Forum Availability

    As we noted in Mercier II, an alternative forum generally will be considered "available" provided the defendant who asserts forum non conveniens is amenable to process in the alternative forum. 935 F.2d at 424 (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 506-07, 67 S.Ct. 839, 842, 91 L.Ed. 1055 (1947)); see also Piper Aircraft, 454 U.S. at 254 n. 22, 102 S.Ct. at

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    265 n. 22. There seems to be no question that Sheraton is amenable to process in the Republic of Turkey. Not only does Sheraton conduct substantial business in Turkey (i.e., operation of the Istanbul Sheraton Hotel), but any contracts at issue in...

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