Dooley v. United Technologies Corp.

• Decision Date: 10 March 1992
• Docket Number: Civ. A. No. 91-2499.
• Parties: Thomas F. DOOLEY, Plaintiff, v. UNITED TECHNOLOGIES CORP., et al., Defendants.
• Court: U.S. District Court — District of Columbia

786 F. Supp. 65

Thomas F. DOOLEY, Plaintiff, v. UNITED TECHNOLOGIES CORP., et al., Defendants.

Civ. A. No. 91-2499.

United States District Court, District of Columbia.

March 10, 1992.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Michael J. Madigan, Robertson T. Park, Michael J. Mueller, Akin, Gump, Hauer & Feld, Kenneth Michael Robinson, Cooter & Gell, Washington, D.C., for plaintiff.

William D. Iverson, Deborah A. Garza, Jeffrey B. Coopersmith, Covington & Burling, John D. Aldock, Laura S. Wertheimer, Shea & Gardner, Thomas F. Cullen, Jr., Christopher F. Dugan, Jones, Day, Reavis & Pogue, Thomas C. Papson, McKenna & Cuneo, Washington, D.C., for defendants.

MEMORANDUM

JUNE L. GREEN, District Judge.

The plaintiff, Thomas Dooley, has brought an action against numerous defendants alleging violations of the Racketeer Influenced and Corrupt Organizations Act, Title 18, United States Code, sections 1961 et seq. ("RICO"), and supplemental state law claims. Several defendants, including the United Technologies Corporate ("UTC Corporate") defendants¹, the United Technologies Individual ("UTC Individual") defendants², defendants Olin E. Smith and Olin E. Smith & Associates ("Smith defendants"), defendant Westland, Incorporated ("Westland, Inc.")³, and defendant Frank E. Basil, Inc. ("Basil")⁴ filed motions challenging jurisdiction and venue and seeking transfer. The Court held a hearing on February 28, 1992, to consider these motions. For the reasons set forth below, the Court finds that personal jurisdiction and venue are proper as to each defendant. The Court further finds that transfer to the District of Connecticut is not appropriate.

FACTS

Plaintiff Dooley's complaint sets forth allegations of a wide-ranging conspiracy encompassing foreign and domestic corporations individuals, and governments. At its root, the conspiracy set forth by the plaintiff is a bribery scheme between representatives of the Saudi Arabian government and Dooley's employer, defendant Sikorsky Aircraft ("Sikorsky"), in concert with its parent corporation, defendant United Technologies Corporation ("UTC"). UTC manufactures and sells military and commercial helicopters. Dooley alleges that throughout the late 1970's UTC actively solicited the Saudi Arabian government as a customer for its helicopters. Dooley further alleges that in 1986, the Saudi Arabian Ministry of Defense and Aviation ("MODA") finally agreed to purchase UTC helicopters. Dooley claims that to obtain the Saudi's business, UTC agreed to pay substantial bribes to Saudi Arabian officials and businessmen.

The conspiracy allegedly developed through tacit agreement between high-level UTC corporate employees and the Saudi Arabian Ambassador to the United States, His Royal Highness ("HRH") Prince Bandar bin Sultan ("Prince Bandar"), and Prince Bandar's Saudi Arabian associates. In its skeletal structure, the scheme described by plaintiff Dooley involved the sale of 13 UTC-manufactured Black Hawk helicopters to MODA through the Foreign Military Sales ("FMS") program administered by the Department of Defense and implicit promises for future sales. In exchange for the sales, UTC agreed to pay bribes to HRH Prince Khalid bin Sultan ("Khalid") and HRH Prince Fahad bin Sultan ("Fahad"), sons of MODA Minister Prince Sultan bin Abdul Aziz bin Saud, and Saudi Arabian businessman Ibrahim A. al-Namlah ("Namlah").

The bribes were to be funneled to the Saudi royalty through a business arrangement linking a Washington, D.C.-based corporation, Frank E. Basil, Inc., with a Saudi Arabian-based corporation, Thimar Al-Jazirah Corporation ("Thimar"). Through the influence of Saudi Arabian officials, including Prince Bandar, defendant Sikorsky was awarded a collateral contract for Maintenance Support Services ("MSS") to the FMS sale, without the normal competitive bidding of the contract. The UTC defendants then, in turn, contracted out for Personnel Support Service ("PSS") under the MSS contract, to the Basil-Thimar joint-venture. This mechanism allegedly allowed the UTC defendants to funnel bribes to Namlah and his "business partners", Khalid and Fahad, while circumventing United States Government oversight and audit procedures.

Namlah, the Saudi businessman designated by Prince Bandar to be UTC's "contact" in Saudi Arabia, is president and part-owner of Thimar. It is alleged that he used the payments from the Basil-Thimar joint venture to pay off Khalid and Fahad and to take a "cut" for himself.

Defendant Olin E. Smith & Associates, Inc. is a closely held corporation whose principal is General Olin E. Smith. Plaintiff Dooley alleges that Olin E. Smith, acting individually and on behalf of Olin E. Smith & Associates, Inc., played a key role in the conspiracy by acting as a go-between for the UTC defendants and Prince Bandar. Dooley claims that defendant Sikorsky retained General Smith to assist in its efforts to market the Black Hawk helicopter to the Saudi military. The plaintiff alleges that General Smith's close relationship with Prince Bandar was instrumental to UTC in obtaining the Ambassador's assistance in the bribery scheme.

Plaintiff Dooley alleges that Defendant Westland, Inc.'s involvement in the international conspiracy derives from its parent corporation, Westland Group PLC's, role in the affair. Dooley contends that as part of the alleged conspiracy, the UTC defendants agreed to the Saudi Arabian's demand that the Black Hawk helicopters be armed. Dooley alleges, that UTC, knowing the United States Government would not approve the sale of armed Black Hawks, sought the assistance of Westland Group PLC, a British manufacturer of military hardware in which UTC owned 7 percent stock. Dooley claims that the defendants conspired to amend a licensing agreement between UTC and Westland Group PLC so as to allow sales of armed Black Hawks to Saudi Arabia without the knowledge or approval of Congress, and the United States Government. According to the plaintiff, defendant Westland, Inc. played a role in attaining the amendment. Dooley contends that the Westland defendants' involvement in the conspiracy was critical in getting armed helicopters to the Saudi government.

ANALYSIS

I. PERSONAL JURISDICTION

The plaintiff has the burden of establishing that jurisdiction exists. Lott v. Burning Tree Club, Inc., 516 F.Supp. 913, 918 (D.D.C.1980). Facts asserted by the plaintiff in his Complaint are presumed to be true unless directly contradicted by affidavit. Data Disc, Inc. v. Systems Tech. Assoc., Inc., 557 F.2d 1280, 1284 (9th Cir.1977). However, where the parties are limited to written submissions, such as affidavits, the plaintiff need make only a prima facie showing to prevail on a motion to dismiss for want of jurisdiction. Chase v. Pan-Pacific Broadcasting, Inc., 617 F.Supp. 1414 (D.D.C.1985).

Plaintiff Dooley raises several grounds which he argues give the Court personal jurisdiction over the defendants. The Court has carefully considered each argument. The Court finds two alternative bases on which to exercise personal jurisdiction over the defendants in this case. First, the Court finds that RICO provides for nationwide service of process under section 1965(d). Alternatively, the Court finds that it has personal jurisdiction over each defendant under the "transacting business clause" of the District of Columbia long-arm statute. Because the Court finds that it may exercise personal jurisdiction over all the defendants under either RICO section 1965(d) or section 13-423(a)(1) of the District of Columbia long-arm statute, it does not reach the question of whether any of the other grounds asserted by the plaintiff also support this Court's exercise of personal jurisdiction in this case.

A. RICO § 1965(d)

Title 18, United States Code, section 1965(d) provides:

All other process in any action or proceeding under this chapter may be served on any person in any judicial district in which such person resides, is found, has an agent or transacts his affairs.

The section has been construed as a nationwide service of process provision. See Bank of Crete, S.A. v. Koskotas, 1991 WL 177287, *1, 91 U.S. LEXIS 12169, *4 (S.D.N.Y. Aug. 30, 1991); Merchants Nat'l Bank v. Safrabank, 1991 WL 173781, 1991 U.S. District LEXIS 12380 (D.Kan. Aug. 28, 1991); University Savings Assn v. Bank of New Haven, 765 F.Supp. 35, 36 (D.Conn.1991); Omni Video Games, Inc. v. Wing Co., Ltd., 754 F.Supp. 261, 263 (D.R.I.1991); American Trade Partners L.P. v. A-1 Int'l Importing Enter., Ltd., 755 F.Supp. 1292, 1302 (E.D.Pa.1990); Bridge v. Invest America, Inc., 748 F.Supp. 948, 951 (D.R.I.1990); Rolls-Royce Motors, Inc. v. Charles Schmitt & Co., 657 F.Supp. 1040, 1055 (S.D.N.Y.1987); Soltex Polymer Corp. v. Fortex Indus. Inc., 590 F.Supp. 1453, 1458 (E.D.N.Y.1984). Under this section, the plaintiff's prima facie burden is met by showing that a defendant has contacts with the United States. Minimum contacts with the forum state, as required under the traditional long-arm jurisdiction analysis, is not necessary. A defendant's contact with the United States is sufficient to satisfy the requirements of due process. Bank of Crete, S.A. v. Koskotas, 1991 WL 177287, at *1, 91 U.S. Dist. LEXIS 12169, at *4, quoting Rolls-Royce Motors, Inc. v. Charles Schmitt & Co., 657 F.Supp. 1040, 1055 (S.D.N.Y.1987) ("Where such nation-wide service of process is authorized, a federal district court's jurisdiction is coextensive with the boundaries of the United States and due process requires only that a defendant in a federal suit have minimum contacts with the United States.")

All of the defendants served in this matter thus far, reside in the United States. The Court, therefore, has personal jurisdiction over each defendant under section 1965(d).

While the Court finds support in the case law from other circuits for its determination that section 1965(d) is RICO's nation-wide service of process provision, it recognizes...