Bfi Group Divino Corp. v. Jsc Russian Aluminum

• Decision Date: 23 March 2007
• Docket Number: No. 06 Civ. 2093(WCC).,06 Civ. 2093(WCC).
• Citation: 481 F.Supp.2d 274
• Parties: BFI GROUP DIVINO CORPORATION, Plaintiff, v. JSC RUSSIAN ALUMINUM d/b/a Rusal, a foreign corporation; JSC Bratsk Aluminum Plant, a foreign corporation; Rusal America Corp., a Delaware corporation; Dayson Holding Ltd., a foreign corporation; and Does 1-20, inclusive, Defendants.
• Court: U.S. District Court — Southern District of New York

481 F.Supp.2d 274

BFI GROUP DIVINO CORPORATION, Plaintiff, v. JSC RUSSIAN ALUMINUM d/b/a Rusal, a foreign corporation; JSC Bratsk Aluminum Plant, a foreign corporation; Rusal America Corp., a Delaware corporation; Dayson Holding Ltd., a foreign corporation; and Does 1-20, inclusive, Defendants.

No. 06 Civ. 2093(WCC).

United States District Court, S.D. New York.

March 23, 2007.

COPYRIGHT MATERIAL OMITTED

Burnham Brown, Oakland, California, for Plaintiff, Jimmie L. Williams, Robert

M. Bodzin, John J. Verber, Derek H. Lim, of counsel.

Gibson, Dunn & Crutcher LLP, New York, New York, for Defendants, Randy M. Mastro, Marshall R. King, Kathryn E. Nealon, of counsel.

OPINION AND ORDER

WILLIAM C. CONNER, Senior District Judge.

Plaintiff BFI Group Divino Corporation brings this action for tortious interference with contractual relations, tortious interference with prospective business advantage, unfair competition and conspiracy to commit fraud against defendants JSC Russian Aluminum d/b/a RUSAL ("RUSAL"), JSC Bratsk Aluminum Plant ("Bratsk"), RUSAL America Corp. ("RUSAL America"), Dayson Holding Ltd. ("Dayson"), and "Does 1-20," several unnamed agents of the aforementioned corporate defendants (collectively, "defendants"). Plaintiff's allegations stem from defendants' alleged corruption of several Nigerian government officials, including the president of the Federal Republic of Nigeria, in connection with the privatization of a publicly-owned Nigerian aluminum facility. Defendants now move to dismiss plaintiffs claims in their entirety, citing plaintiffs failure to plead fraud with particularity pursuant to FED. R. CIV. P. 9(b), lack of subject matter jurisdiction pursuant to FED. R. CIV. P. 12(b)(1), lack of personal jurisdiction pursuant to FED. R. CIV. P. 12(b)(2), insufficiency of service of process pursuant to FED. R. CIV. P. 12(b)(5), failure to state a claim upon which relief can be granted pursuant to FED. R. CIV. P. 12(b)(6) and the common law doctrines of forum non conveniens, international comity, collateral estoppel and the act of state doctrine. For the reasons that follow, defendants' motion is granted.

BACKGROUND

Plaintiff's complaint alleges the following facts. In 1999, the government of Nigeria promulgated the Public Enterprises (Privatization and Commercialization) Act, and went about divesting certain state-owned companies and assets. (Complt.¶¶ 2-3.) One such asset was a majority interest in the Aluminum Smelter Company of Nigeria ("ALSCON") and all of its facilities. (Id.) The sale was overseen by the Nigerian Bureau of Public Enterprises ("BPE"). (Id. ¶ 2.) Plaintiff and Dayson, a British Virgin Islands company, acting on behalf of RUSAL and Bratsk, a RUSAL affiliate, expressed interest in acquiring ALSCON, as did Ferrostaal AG, the company then managing the ALSCON facility pursuant to a prior agreement with the Nigerian government. (Id. ¶ 5.) Bids were to be submitted in sealed envelopes, one containing a document detailing the bidder's technical ability to run ALSCON and the other containing a document setting forth the financial amount of the bid. (Id. ¶ 63.) The technical bids were to be opened immediately, whereas the financial bids were to be opened simultaneously at a televised ceremony in Nigeria later in the year. (Id. ¶¶ 63-64.) On March 24, 2004, following evaluation of its technical bid, Ferrostaal AG was disqualified from the financial bidding process. (Id. ¶ 66.) The General Manager of ALSCON, a Ferrostaal AG employee, informed plaintiff that his employer had been disqualified because the Nigerian government already had promised the facility to RUSAL. (Id. ¶ 67.) RUSAL and plaintiff submitted their bid packages on April 19, 2004 and April 20, 2004 respectively. (Id. ¶¶ 68-73.)

On April 28, 2004, the BPE informed plaintiff that its technical bid had been accepted and that it was thus qualified for participation in the next round of the bidding process. (Id. ¶ 75.) At the prompting of the BPE, however, plaintiff, along with RUSAL, attended a technical bid conference on May 20, 2004, at which the BPE informed the parties of certain bidding procedures, as well as financial obligations accompanying the acquisition of ALSCON. (Id. ¶¶ 75-78.) The parties were given until June 4, 2004 to revise their bids to accommodate the new information. (Id. ¶ 78.) On May 23, 2004, plaintiff delivered to the BPE an affirmation indicating that it had accepted the terms proposed at the May 20, 2004 technical bid conference. (Id. ¶ 81.) At the same time, it informed the BPE's General Director, Julius Bala, that it was concerned that RUSAL had been promised the ALSCON facility. (Id.) Bala informed plaintiff that Nigerian President Olusegun Obasanjo had directed his National Security Advisor, General Aliyu Gusau, to assist RUSAL in forming its bids in order to increase its chances of acquiring ALSCON. (Id.) Two days later, plaintiff's representatives met personally with President Obasanjo, who assured them that he had not made any prior agreement to award the contract to RUSAL. (Id. ¶ 86.)

On June 14, 2004, the sealed financial bids were opened. (Id. ¶ 91.) Plaintiff submitted the high bid of $410 million. (Id. ¶¶ 95-96.) RUSAL, on the other hand, was disqualified for submitting a $205 million conditional¹ bid in violation of the terms of the bid documents, which required that all bids be unconditional. (Id. ¶¶ 68, 93.) Following RUSAL's disqualification, the BPE declined to enter into a purchase agreement with plaintiff, although it allegedly had prepared a letter awarding plaintiff the bid, but was ordered by President Obasanjo to delay its delivery. (Id. ¶ 96.) Following the bid-opening ceremony, President Obasanjo dissolved the National Council on Privatization (the entity administering the bidding process) and assumed personal control over its functions. (Id. ¶ 97.) On June 17, 2004, plaintiff received a letter from the BPE stating that it was the winning bidder and instructing it to tender ten percent of the purchase price within fifteen business days from receipt of the letter. (Id. ¶ 101.) Plaintiff objected to tendering payment prior to the signing of a final purchase agreement, as was provided in the original bid contract. (Id. ¶ 102.) The BPE then attempted to modify the terms of the purchase agreement²7 and, despite plaintiffs attempts to negotiate, the BPE sent plaintiff a letter on July 9, 2004 stating that it had been disqualified from the bidding process. (Id. ¶¶ 102-107.) On February 3, 2006, RUSAL purchased ALSCON for $250 million, $160 million less than plaintiff's bid. (Id. ¶ 108.) Plaintiff subsequently sued the Nigerian government in the Federal High Court of Nigeria for the Abuja Judicial Division, which held that no contract existed between plaintiff and the Nigerian government. (See Omo Decl., Ex. A.) Although plaintiff has appealed that decision, no decision has yet been rendered on appeal.

Plaintiff subsequently filed the instant Complaint, which defendants now move to dismiss on the grounds of: (1) failure to plead fraud with particularity pursuant to FED. R. Cry. P. 9(b); (2) lack of subject matter jurisdiction pursuant to FED. R. CIV. P. 12(b)(1); (3) lack of personal jurisdiction pursuant to FED: R. Cry. P. 12(b)(2); (4) insufficiency of service of process pursuant to FED. R. CIV. P. 12(b)(5); (5) failure to state a claim upon which relief can be granted pursuant to FED. R. CIV. P. 12(b)(6); (6) forum non conveniens; (7) international comity; (8) collateral estoppel; and (9) the act of state doctrine. For the reasons that follow, defendants' motion is granted pursuant to the doctrine of forum non conveniens.³

DISCUSSION

The doctrine of forum non conveniens permits a court, in its discretion, "to resist the imposition upon its jurisdiction," even though jurisdiction may be lawfully exercised and venue technically proper, where the convenience of the parties and the interests of justice favor dismissal. Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 507, 67 S.Ct. 839, 91 L.Ed. 1055 (1947); Koster v. Lumbermens Mut. Casualty Co., 330 U.S. 518, 527, 67 S.Ct. 828, 91 L.Ed. 1067 (1947). Dismissal is appropriate where "trial in the plaintiff's chosen forum imposes a heavy burden on the defendant or the court, and where the plaintiff is unable to offer any specific reasons of convenience supporting his choice." Piper Aircraft Co. v. Reyno, 454 U.S. 235, 249, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981). In exercising its discretion, a court is steered by the guideposts established by the Supreme Court in Gilbert, 330 U.S. at 508-09, 67 S.Ct. 839, and reinforced in Piper, 454 U.S. at 241 n. 6, 102 S.Ct. 252, that direct a court to examine the "private interest factors" relating to the convenience of the litigants, as well as the "public interest factors" relating to the convenience of the forum and the ends of justice. Gilbert, 330 U.S. at 508-09, 67 S.Ct. 839; Alcoa S.S. Co. v. M/V Nordic Regent, 654 F.2d 147, 150-51, 151 n. 4 (2d Cir.1980) (en Banc ); Monsanto Int'l Sales Co. v. Hanjin Container Lines Ltd., 770 F.Supp. 832, 835 (S.D.N.Y. 1991).

Because the doctrine of forum non conveniens presupposes at least two fora in which the action may proceed, the Court must initially determine whether an adequate alternative forum in fact exists. Gilbert, 330 U.S. at 506-07, 67 S.Ct. 839; Piper, 454 U.S. at 254 n. 22, 102 S.Ct. 252. Once the availability of an alternate forum is established, the Court weighs, in its sound discretion, the pertinent private and public interest factors to assess whether dismissal from the present forum is appropriate. Piper, 454 U.S. at 256, 102 S.Ct. 252; In re Union Carbide Corp. Gas Plant Disaster at Bhopal, India in Dec. 1984, 634 F.Supp. 842, 845 (S.D.N.Y.1986), aff'd as modified by 809 F.2d 195 (2d Cir.), cert. denied, 484 U.S. 871, 108 S.Ct. 199, 98 L.Ed.2d 150 (1987). Application of the factors enunciated in Gilbert varies depending on the unique...