985 F.Supp. 640 (E.D.Va. 1997), Civ. A. 97-556, Dee-K Enterprises, Inc. v. Heveafil Sdn. Bhd.
|Docket Nº:||Civ. A. 97-556|
|Citation:||985 F.Supp. 640|
|Party Name:||Dee-K Enterprises, Inc. v. Heveafil Sdn. Bhd.|
|Case Date:||December 23, 1997|
|Court:||United States District Courts, 4th Circuit, Eastern District of Virginia|
Joel Davidow, Sturgis M. Sobin, Ablondi, Foster, Sobin & Davidow, P.C., Michael D. Hausfeld, Daniel A. Small, Paul T. Gallagher, Cohen, Milstein, Hausfeld & Toll, PLLC, Washington, DC, for Plaintiffs.
Walter J. Spak, Anne D. Smith, Carolyn B. Lamm, Denise L. Diáz, George L. Paul, Francis A. Vasquez Jr., White & Case, Washington, DC, for Heveafil Sdn. Bhd., Filmax Sdn. Bhd., Rubfill Sdn. Bhd., Rubberflex Sdn. Bhd., Filati Lastex Sdn. Bhd., Filati Lastes Elastofibre USA, Inc., Filati Corp. of RI, Filati Corp. of NC, Rubfil USA, Inc., and P.T. Bakrie Rubber Industry.
David M. Foster, Joseph T. Small, Christine P. Hsu, Fulbright & Jaworski, LLP, Washington, DC, for JPS Elastomerics Corp.
James A. West, James A. West, PC, Houston, TX, for Consortium International Corp.
ELLIS, District Judge.
In this international antitrust action, plaintiffs allege a conspiracy between and among various foreign manufacturers of extruded rubber thread and their distributors to fix prices of the thread in the United States. The underlying facts are set out in full in an earlier Memorandum Opinion in this matter. See Dee-K Enterps., Inc. v. Heveafil Sdn. Bhd., 982 F.Supp. 1138 (E.D.Va.1997).
The matter now before the Court is a motion by several defendants to dismiss for improper venue pursuant to Rule 12(b)(3), Fed.R.Civ.P. The facts pertinent to this motion may be succinctly stated. The named defendants fall into two groups: (i) Malaysian, Indonesian, and Thai manufacturers of extruded rubber thread, and (ii) the American distributors of the thread. None of these defendants is located in the Eastern District of Virginia. Moreover, no defendant transacts business in this District; defendant Consortium International Corp. ("Consortium") has supplied thread to plaintiff Dee-K Enterprises, Inc. ("Dee-K") in Virginia, but all of those transactions took place in the Western District of Virginia. Thus, certain defendants contend that venue is improper in this District. Several defendants also moved to dismiss this action for lack of personal jurisdiction and for failure to state a claim; these motions were denied by the earlier Memorandum Opinion. Left undecided by that Memorandum Opinion, however, was defendants' motion to dismiss for improper venue. See Dee-K, 982 F.Supp. at 1148-49. Accordingly, by Order dated October 23, 1997, plaintiffs were directed to file a memorandum concerning the propriety of venue in the Eastern District of Virginia. Plaintiffs have filed such a memorandum, and defendants have filed their responses. Thus, the matter is now ripe for disposition.
The threshold question is whether the venue objection has been waived. Plaintiffs contend that each defendant either failed to raise an objection to venue in its first responsive pleading or Rule 12 motion, as required by Rule 12(h)(1), Fed.R.Civ.P., or waived its objection to venue by later asserting a counterclaim. Plaintiffs' contention is correct as to all defendants but one.
Plaintiffs filed their complaint on April 17, 1997. Nine defendants (the "Malaysian defendants") filed their first Rule 12 motion on June 9, 1997, and did not challenge venue in that pleading. Three of those defendants, namely Rubfil USA, Inc., Flexil Corp., and Filati Lastex Elastofibre USA, Inc., contend that they were not required to raise an improper-venue defense at that time because the defense was not "then available." See Rules 12(g), (h), Fed.R.Civ.P. (providing that defense is waived only for objections "then available," i.e., available at the time the first pleading was filed). These domestic defendants base their contention on the erroneous proposition that simply because the original complaint was sufficiently vague to warrant dismissal for lack of specificity,1 it must also have been so vague as to obscure whatever basis for venue might have existed at that time. Thus, the domestic defendants argue they were not able to discern whether venue was proper in this District until plaintiffs filed their more specific, amended complaint and indicated precisely which of defendants' acts constituted the alleged conspiracy. This argument amounts to the assertion that the domestic defendants could not, on their own, have known whether or not they conducted any business in this District such that venue here would be proper until plaintiffs identified specific alleged conduct in this District that they believed violated the antitrust laws.
This argument is unpersuasive. First, these domestic defendants certainly knew the scope and details of their business activities, and thus they knew whether they resided, transacted business, or could be found in this District. See 28 U.S.C. § 1391 (setting forth criteria for proper venue). Therefore, they cannot now claim that they were unaware of a potential objection to venue
at the time the original complaint was filed. Had a venue objection then been available, they could and should have raised it at that time.2 Second, and more important, because improper venue is an affirmative defense, allegations showing that venue is proper need not be included in the complaint.3 It follows that the Malaysian defendants have waived any objection to venue they might have had.
Yet another defendant, PT Bakrie Rubber Industry, filed its first Rule 12 motion on June 17, 1997, and did not raise a venue objection therein. Thus, it too has waived any venue objection. Three more defendants, PT Perkebunan III ("Perkebunan"), Natural Rubber Thread Co., and Longtex Rubber Industries, are in default, and thus they have waived all venue objections. See Hoffman v. Blaski, 363 U.S. 335, 343, 80 S.Ct. 1084, 1089, 4 L.Ed.2d 1254 (1960). In any event, venue is proper in this District as to all of these foreign defendants pursuant to 28 U.S.C. § 1391(d).4
Consortium, the last remaining defendant, by contrast did preserve its objection to venue, which it raised in response to both the first amended complaint and the second amended complaint.5 Plaintiffs now assert, however, that because Consortium has filed a counterclaim in this action, it has...
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