ELANDIA INTERN., INC. v. AH KOY
| Decision Date | 17 February 2010 |
| Docket Number | Case No. 09-20588-CIV. |
| Citation | 690 F. Supp.2d 1317 |
| Parties | ELANDIA INTERNATIONAL, INC., Plaintiff, v. Sir James AH KOY, Michael Ah Koy, Kelton Investments Ltd., and Datec Group Ltd., Defendants. |
| Court | U.S. District Court — Southern District of Florida |
John Arrastia, Jr., John Arrastia, Jr. P.A., Miami, FL, for Plaintiff.
Richard Wade Smith, Lora A. Dunlap, Fisher Rushmer Werrenrath Dickson et al., Orlando, FL, for Defendants.
ORDER ADOPTING MAGISTRATE'S REPORT AND RECOMMENDATION AND DENYING DEFENDANTS' MOTION TO DISMISS
THE MATTER was referred to the Honorable Edwin G. Torres, United States Magistrate Judge for a Report and Recommendation on Defendants' Motion to Dismiss for Lack of Personal Jurisdiction under Federal Rules of Civil Procedure 12(b)(2) (D.E. No. 17), filed on April 17, 2009. The Magistrate Judge filed a Report and Recommendation (D.E. No. 57) on August 24, 2009. The Court has reviewed the entire file and record. The Court has made a de novo review of the issues that the objections to the Magistrate Judge's Report and Recommendation present, and being otherwise fully advised in the premises, it is
ADJUDGED that United States Magistrate Judge Edwin G. Torres's Report and Recommendation (D.E. No. 57) on August 24, 2009 is AFFIRMED and ADOPTED. Accordingly, it is ADJUDGED that:
(1) Defendants' Motion to Dismiss for Lack of Personal Jurisdiction (D.E. No. 17) is DENIED.
This matter comes before the Court on Defendants Sir James Ah Koy, Michael Ah Koy, Kelton Investments Ltd., and Datec Group Ltd.'s ("Defendants") Motion to Dismiss for Lack of Personal Jurisdiction under Federal Rules of Civil Procedure 12(b)(2) D.E. 17 (hereinafter "Motion"). Plaintiff eLandia International Inc. ("eLandia") has filed a Memorandum of Law in Opposition to Defendants' Motion D.E. 26 (hereinafter "Opposition"). Defendants have filed a Reply to Plaintiffs Opposition. D.E. 28 (hereinafter "Reply"). For the following reasons, Defendants' Motion should be Denied.
On March 17, 2009, Plaintiff eLandia filed an Amended Complaint against Defendants in the Southern District of Florida after Defendants allegedly filed litigation in Fiji and blocked Plaintiffs sale of Plaintiffs asset. Plaintiff alleges the following: (1) Defendant James Ah Koy committed breach of fiduciary duty, conspiracy to breach fiduciary duty, breach of implied covenant of good faith and fair dealing, and tortious interference; (2) Defendant Michael Ah Koy committed aiding and abetting breach of fiduciary duty, conspiracy to breach fiduciary duty, breach of implied covenant of good faith and fair dealing, tortious interference, and breach of contract; (3) Defendant Datec Group Ltd. ("Datec Group") committed aiding and abetting breach of fiduciary duty, conspiracy to breach fiduciary duty, and tortious interference; and (4) Defendant Kelton Investments Ltd. ("Kelton") committed aiding and abetting breach of fiduciary duty, conspiracy to breach fiduciary duty, breach of the implied covenant of good faith and fair dealing, and tortious interference.1
Defendants filed this Motion on April 17, 2009. D.E. 17. Defendants allege that the Southern District of Florida cannot exert jurisdiction over Defendants because Plaintiffs claim does not meet the jurisdictional requirements of Florida's long-arm statute or constitutional due process. Id.. The personal jurisdiction issue was also the first argument raised in opposition to eLandia's motion for preliminary injunction, which motion seeks an anti-suit injunction precluding Defendants from pursuing litigation in Fiji that arises or relates to their agreements. D.E. 11.
Plaintiff filed its Opposition on May 6, 2009, claiming that jurisdiction is proper because Defendants' activity satisfies Florida long-arm statutes §§ 685.101-02 and §§ 48.193(1)(a), (1)(b) and due process requirements. D.E. 26 at 12-18, Defendants filed a reply on May 18, 2009. D.E. 28,
We ordered the parties to file supplemental briefing by June 24, 2009 regarding the relevance of the Florida Third District Court of Appeals decision that found that a forum selection clause alone could confer personal jurisdiction on a Florida court under §§ 685.101-02. D.E. 38. The parties filed their supplemental briefs on June 24, 2009. D.E. 44, 45.
We held a hearing on July 7, 2009. The record on the pending motion is thus complete. The parties stipulated that no evidentiary hearing was necessary, and we find that none is necessary given the lack of disputed material facts relevant to the jurisdiction issue.
Plaintiff eLandia is a corporation organized under the laws of Delaware with its principal place of business in Coral Gables, Florida. D.E. 12-2 at 1. eLandia provides information technology services to businesses and government entities located in the South Pacific through several subsidiaries located in that region. Id.. Stanford International Bank ("Stanford") is a banking corporation that is not a party to this action. Until February 2009, Stanford was a major shareholder of Plaintiff eLandia and principle source of Plaintiff eLandia's financing for operations. D.E. 4 at 4.
Defendant James Ah Koy is a citizen of Suva Fiji, but resides in Beijing, China. D.E. 17 at 3. Defendant Michael Ah Koy is a citizen and resident of Mairangi Bay, Auckland, New Zealand. D.E. 4 at 3. Defendant Kelton is an investment holding company. D.E. 17 at 4. Kelton's principal place of business and place of incorporation is located in Fiji. D.E. 4 at 3. Michael Ah Koy is a shareholder and chairman of Kelton. Defendant James Ah Koy controls Kelton. D.E. 22-2 at 2. None of Kelton's shareholders or directors reside in Florida. D.E. 17 at 4. Kelton does not conduct business in Florida, is not licensed to do business in Florida, has never owned or leased any real or personal property in Florida, and has never maintained a depository or bank account in Florida. Id..
Defendant Datec Group's principal place of business and place of incorporation is located in Canada. D.E. 4 at 3. Kelton held 30% of Datec Group's outstanding common stock. D.E. 22-2 at 2. Michael Ah Koy was the chief executive officer of Datec Group until 2004. Id.. James Ah Koy was the director and founder of Datec Group. D.E. 4 at 3, 6. James Ah Koy and Michael Ah Koy control Datec Group, either directly or indirectly. Id. at 3. Datec Group was an information technology company that provided services to the South Pacific markets. D.E. 22-2 at 2. Before February 1, 2006, Datec Group conducted its operations under the following wholly-owned subsidiaries: (1) Generic Technology Ltd. ("Generic"), a Fiji registered company; and (2) Datec Investments Ltd., a New Zealand registered company. D.E. 17 at 3. Generic owns Datec PNG Pty Ltd ("Datec PNG"), a company which is registered in Papua New Guinea.2,3 Id. at 3.
Datec Group maintains its business records in Edmonton, Canada and Auckland, New Zealand. Id. at 4. Datec Group has never directly conducted business in Florida, has never been licensed to do business in Florida, has never been registered with the Florida Secretary of State to transact business in Florida, has never owned or leased any real or personal property in Florida, and has never maintained a depository or bank account in Florida. Id. at 4.
Plaintiff eLandia, Defendant James Ah Koy, Defendant Michael Ah Koy, and several Datec Group representatives attended a two-day meeting in Florida to begin negotiations in the summer of 2005 to merge the assets of eLandia and Datec Group. D.E. 17 at 5. Michael Ah Koy and other representatives of Datec Group directed email and telephone communications to eLandia's office in Florida during the merger negotiations. D.E. 22-2 at 3. During the negotiations eLandia agreed to devote capital to the Datec Group subsidiaries, which would help both parties develop opportunities in the South Pacific telecommunications market. D.E. 17 at 5.
Consequently, eLandia entered into an Amended and Restated Arrangement Agreement ("Arrangement Agreement") with Defendants Datec Group, James Ah Koy, Michael Ah Koy, and Kelton on or about August 8, 2005. D.E. 26 at 8. eLandia exchanged 31% of its issued and voting share capital for all of Datec Group's operating subsidiaries, specifically Generic Technology Limited ("Generic") and Datec PNG. D.E. 17 at 5. The Arrangement Agreement was governed by Canadian law and subject to the approval of the Canadian courts and Datec Group shareholders. D.E. 4 at 7. The value of the transaction was approximately $14.6 million D.E. 22-2 at 4 and closed in Florida on or about February 1, 2006. D.E. 26 at 9.
Datec Group became a shell corporation that lacked business and assets following the Arrangement Agreement. D.E. 4 at 7. Moreover, Canadian securities regulators prohibited trading in Datec Group's stock and the United States Securities and Exchange Commission revoked Datec Group's registration because Datec Group did not file the required reports. Id..
Following the Arrangement Agreement, James Ah Koy served as a director of eLandia from December 2005 until April 2009 D.E. 22-2 at 4 and is currently a director of Generic and Datec PNG. D.E. 12-2 at 3. James Ah Koy did not have an office in Florida and conducted the majority of his duties from Fiji or China. D.E. 17 at 5.
Shortly after closing the Arrangement Agreement, James Ah Koy claimed that eLandia did not provide the promised capital for the South Pacific Datec subsidiaries. D.E. 22-2 at 5. James Ah Koy made these complaints in several venues, including an eLandia Board meeting James Ah Koy attended in Florida. D.E. 26 at 10.
Defendant Michael Ah Koy served as Plain...
To continue reading
Request your trial
-
Tracfone Wireless, Inc. v. Adams
...of the TracFone prepaid airtime is paid for by TracFone within Florida. Second Wehling Declaration at ¶ 4; Elandia Int'l, Inc. v. Ah Koy, 690 F.Supp.2d 1317, 1331 (S.D.Fla.2010) (finding that a nonresident's conduct outside the forum state that damaged a corporation, which maintained its pr......
-
Jackson Cnty. Employees' Ret. Sys. v. Ghosn
...it is within the court's discretion to exercise pendent personal jurisdiction over them."); see also Elandia Int'l, Inc. v. Ah Koy, 690 F. Supp. 2d 1317, 1341 (S.D. Fla. 2010) (applying pendent personal ...
-
Vas Aero Servs., LLC v. Arroyo
...interpret section 1(b) and the Florida intermediate appellate courts are split on this issue, see, e.g., Elandia Intern., Inc. v. Ah Koy, 690 F.Supp.2d 1317, 1328–29 (S.D.Fla.2010) (citing Posner v. Essex Ins. Co., 178 F.3d 1209, 1216 (11th Cir.1999)), I am bound to follow Eleventh Circuit ......
-
Landmark Bank, N.A. v. Cmty. Choice Fin., Inc.
...of the conspiracy, then all of the conspirators are subject to personal jurisdiction in Florida." Elandia Int'l, Inc. v. Ah Koy, 690 F. Supp. 2d 1317, 1330 (S.D. Fla. 2010) (alterationadded) (citing Horizon Aggressive Growth, L.P. v. Rothstein-Kass, P.A., 421 F.3d 1162, 1169 (11th Cir. 2005......