Bp Chemicals Limited v. Jiangsu Sopo Corp., 4:99CV323 CDP.

• Decision Date: 26 April 2006
• Docket Number: No. 4:99CV323 CDP.,4:99CV323 CDP.
• Parties: BP CHEMICALS LIMITED, Plaintiff, v. JIANGSU SOPO CORPORATION (Group) Limited, et al., Defendants.
• Court: U.S. District Court — Eastern District of Missouri

429 F.Supp.2d 1179

BP CHEMICALS LIMITED, Plaintiff, v. JIANGSU SOPO CORPORATION (Group) Limited, et al., Defendants.

No. 4:99CV323 CDP.

United States District Court, E.D. Missouri, Eastern Division.

April 26, 2006.

Appeal from the United States District Court for the Eastern District of Missouri, 144 F.Supp.2d 1140.

Charles A. Weiss, Daniel A. Crowe, Mark S. Deiermann, Robin G. Weaver, Bryan Cave LLP, St. Louis, MO, Harris A. Senturia, James W. Satola, James D. Thomas, Squire and Sanders, Cleveland, OH, for Plaintiff.

Anne S. Toker, Jaculin Aaron, Keum A. Yoon, Rui Yang, Shearman and Sterling, LLP, Salem M. Katsh, Kasowitz and Benson, New York, NY, Douglas E. Olson, Paul and Hastings, LLP, San Diego, CA, Jared A. Goldstein, Shearman and Sterling LLP, Washington, DC, Kenton E. Knickmeyer, Michael D. O'Keefe, Sr., James W. Erwin, Thompson Coburn, St. Louis, MO, Louisa G. Weix, Ned N. Isokawa, Paul, Hastings, Janofsky, San Francisco, CA, for Defendants.

MEMORANDUM AND ORDER

PERRY, District Judge.

Defendant Jiangsu Sopo Corporation ("SOPO") seeks dismissal of this case on the grounds of international comity and forum non conveniens, or a stay on the grounds of international abstention. SOPO also seeks a judgment on the pleadings or summary judgment on plaintiff BP Chemicals's Lanham Act and Missouri Uniform Trade Secrets Act claims.

I previously denied SOPO's motion to dismiss for forum non conveniens, but SOPO argues that things have changed since that decision. Specifically, SOPO argues that BP's filing suit against it in a Chinese court shows that the Chinese forum is adequate and more convenient. I disagree, and continue to hold that the courts of China would not provide an adequate forum for BP's claims against SOPO. Nor do I find that the circumstances of this case justify a stay of this proceeding on the grounds of international abstention.

I agree with SOPO, however, that the Lanham Act, even in conjunction with the Paris Convention, does not provide a federal cause of action for trade secret misappropriation, and so I will grant SOPO's motion for judgment on Counts II and VI. I also agree with SOPO that BP's claim under the Missouri Uniform Trade Secrets Act must fail because it is based on allegations of misappropriation that began before MUTSA was effective. I will therefore grant the motion for judgment on the pleadings as to Count III.

I. Background

This case has twice already gone to the Court of Appeals, and the reported decisions, BP Chemicals, Ltd. v. Jiangsu Sopo Corp., 285 F.3d 677 (8th Cir.2002) (BP I) and BP Chemicals, Ltd. v. Jiangsu SOPO Corp. (Group), 420 F.3d 810 (8th Cir.2005) (BP II), set out its factual and procedural background.

Plaintiff BP Chemicals Ltd. is a British corporation with its principal place of business in London, England. Among other businesses, BP is involved in the design and construction of commercial plants used to manufacture acetic acid through a process known as methanol carbonylation. Since BP acquired the rights in 1986, it has licensed rights to use its methanol carbonylation process to other acetic acid plants in numerous countries. BP has taken extensive steps to maintain the proprietary nature of its acetic acid technology.

Defendant Jiangsu SOPO Corporation (Group) Ltd. is a Chinese state-owned petrochemical company. SOPO is the owner of the "921 plant," which is an acetic acid plant located in Zhenjiang City, Jiangsu Province, People's Republic of China. Production at the 921 plant began in 1998. SOPO is a large enterprise which has significant ties to the local Chinese Communist Party.

BP alleges that SOPO, acting with others, unlawfully obtained access to BP's acetic acid technology and that SOPO copied the specifications for its 921 plant from one of BP's licensed plants in Asia. According to BP, SOPO disclosed the wrongfully acquired trade secrets to a number of vendors in the United States, who used BP's stolen trade secrets to fabricate and provide items for SOPO's use in the 921 plant.

In March 2004, I denied SOPO's motion to dismiss, which alleged immunity under the Foreign Sovereign Immunities Act and lack of personal jurisdiction. I also denied SOPO's request for dismissal on grounds of forum non conveniens. Based on an extensive evidentiary record, I concluded that the courts of China would not provide an adequate forum for BP's claims and that, even if China were an adequate alternative forum, the balance of public and private interests weighed in BP's favor. SOPO appealed the jurisdictional ruling, and the Eighth Circuit, in BP II, affirmed my ruling on both FSIA immunity and personal jurisdiction, and remanded for further proceedings. The forum non conveniens decision was not considered in the appeal.

While the appeal was pending, BP filed suit in the Shanghai High People's Court in the People's Republic of China against SOPO and others. The bill of indictment requests the court to order defendants to: (1) immediately stop infringing BP's business secrets; (2) immediately stop infringing BP's copyright; (3) pay compensation for BP's loss; (4) publicly apologize to BP; and (5) bear the legal costs and attorney's fees of the Chinese court action. On September 8, 2005, the Chinese court accepted the case and issued a Notice of Response to Action.

After this case had been remanded from the Eighth Circuit, SOPO moved to dismiss on international comity or forum non conveniens grounds, citing BP's recent filing in China. Alternatively, SOPO seeks a stay on the grounds of international abstention, pending the conclusion of the Shanghai suit.

II. Motion to Dismiss or Stay

A. International Comity

SOPO argues that I should defer to the Chinese court that is now considering BP's new case. It contends that international comity requires this Court to show respect to foreign nations and to avoid litigation in two court systems that could lead to conflicting judgments.

The Supreme Court has explained international comity as "the recognition which one nation allows within its territory to the legislative, executive, or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens, or of other persons who are under the protection of its laws." Hilton v. Guyot, 159 U.S. 113, 164, 16 S.Ct. 139, 40 L.Ed. 95 (1895). "`Comity refers to deference to another sovereign's definite law or judicial decision' and not to pending proceedings." Abdullah Sayid Rajab Al—Rifai & Sons W.L.L. v. McDonnell Douglas Foreign Sales Corp., 988 F.Supp. 1285, 1290 n. 3 (E.D.Mo.1997) (quoting Dragon Capital Partners v. Merrill Lynch Capital Serv., Inc., 949 F.Supp. 1123, 1126 n. 8 (S.D.N.Y.1997)).

Because no definite judicial decision has been reached in the Shanghai Court action, international comity does not apply. Even the case cited by SOPO in its memorandum in support, Turner Entm't Co. v. Degeto Film GmbH, discussed comity in the context of deference to a judgment on the merits that had been reached in a foreign court. 25 F.3d 1512 (11th Cir.1994). International comity suggests deference to judicial decisions, not to pending actions.

B. Forum Non Conveniens

The doctrine of forum non conveniens requires a balancing of "the plaintiff's privilege of choosing his forum . . . against that forum's convenience for the parties and the court." 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1352 (3d ed.2004). The balance must be strongly in favor of the defendant in order to upset plaintiff's choice of forum. Reid-Walen v. Hansen, 933 F.2d 1390, 1394 (8th Cir.1991) (citing Lehman v. Humphrey Cayman, Ltd., 713 F.2d 339, 342 (8th Cir.1983)). Based on the presumption that an alternative adequate forum exists, the forum non conveniens decision requires analysis of private and public factors. Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508, 67 S.Ct. 839, 91 L.Ed. 1055 (1947).

In my March 29, 2004 Order I examined in great detail the application of the doctrine of forum non conveniens to the facts of this case. Most of SOPO's newly-filed evidence is redundant of evidence submitted earlier and presents little change to the analysis of the public and private interest factors. The only new information that is material to this analysis is the notice of a parallel proceeding, voluntarily filed by BP and currently pending in Shanghai High People's Court.

SOPO argues that BP is estopped from challenging the adequacy of the Chinese court system since it voluntarily filed suit there. SOPO cites cases where the foreign proceeding was filed before the U.S. court proceeding. See EFCO Corp. v. Aluma Systems USA, Inc., 268 F.3d 601 (8th Cir.2001) (affirming dismissal of action based on forum non conveniens where suit was initially filed in Canada and could be refiled there without prejudice); Dragon Capital Partners L.P. v. Merrill Lynch Capital Services Inc., 949 F.Supp. 1123, 1128 (S.D.N.Y.1997) (suit dismissed in deference to previously filed action in Hong Kong). The cases SOPO cites are unlike this one because here suit was originally filed in the United States, and the Chinese suit was not filed until six years later.

One of the private interest factors in the forum non conveniens analysis is the level of deference due to the plaintiffs choice of forum. See Reid-Walen, 933 F.2d at 1394. According to the Supreme Court, "unless the balance is strongly in favor of the defendant, the plaintiffs choice of forum should rarely be disturbed." Gulf Oft, 330 U.S. at 508, 67 S.Ct. 839. Some cases decided after Gulf Oil have held that foreign plaintiffs are entitled to less deference in their choice of forum than plaintiffs who are citizens or residents of the United States. See, e.g., Piper Aircraft Co. v. Reyno, 454 U.S. 235, 256 n. 23, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981). As I noted in footnote 1 of my March 29, 2004 Order, however, and as is discussed in more detail infra, the Paris...