Euroboor BV v. Grafova, 2:17-cv-02157-KOB
| Decision Date | 23 September 2021 |
| Docket Number | 2:17-cv-02157-KOB |
| Parties | EUROBOOR B.V. and ALBERT KOSTER, et al., Plaintiffs/Counterclaim Defendants, v. ELENA GRAFOVA, Defendant/Counterclaim Plaintiff. |
| Court | U.S. District Court — Northern District of Alabama |
This case-which the court previously referred to as containing “all the hallmarks of a Hollywood blockbuster”-returns to the court for its sequel after an intermission of over two years. (Doc. 88 at 1). During that time, the parties engaged in discovery, and now they both ask the court to end the show early through motions for summary judgment. Defendant Elena Grafova also wants the court to only consider certain parts of the show before giving its final “review;” in other words, she has moved to strike certain affidavits put forth by the Euroboor Plaintiffs.
If the court had any say in the Academy Awards, the underlying story of this case would certainly qualify for an Oscar in a new category: “Best Cautionary Tale about Mixing Romance and Business.” Plaintiff Albert Koster and Defendant Elena Grafova were once business associates, and they were also married. Grafova loaned substantial funds-around $700 000-to Koster's business. But both the business and the romance went south in 2017, shortly after Ms. Grafova moved to the United States and announced her intent to divorce Mr Koster. The blockbuster events that followed-alleged fraud scathing emails, defaulted loans, and corporate collapse-led to this lawsuit and several others in at least three countries. Here, Plaintiffs allege that Ms. Grafova's actions related to the business constituted fraud, computer crimes, interference with business relations, and defamation among other claims. Ms. Grafova alleges that Plaintiffs breached contracts, committed fraud, and converted her property, among other claims. Before the court are the parties' cross-motions for summary judgment, as well as Ms. Grafova's motion to strike the affidavits of two witnesses.
For the reasons discussed below, the court rules as follows. The court will DENY Ms. Grafova's motion to strike. (Doc. 213). The court will GRANT IN PART and DENY IN PART Defendant/Counterclaim Plaintiff Elena Grafova's motion for partial summary judgment (docs. 197, 203). The court will GRANT IN PART and DENY IN PART the motion for partial summary judgment filed by Plaintiffs/Counterclaim Defendants Euroboor B.V., Euroboor USA, and Albert Koster (doc. 199). Finally, the court will GRANT IN PART and DENY IN PART Counterclaim Defendant Euroboor FZC's motion for partial summary judgment (doc. 201).
For the sake of clarity, the court will begin its analysis with Ms. Grafova's motion to strike (doc. 213) to ensure that the court considers only appropriate facts set out in its factual narrative in ruling on the motions for summary judgment.
Ms. Grafova moved to strike the affidavits of Tulsidas Gawande (doc. 208-8) and Rehman Shahzad (doc. 208-18) under Fed.R.Civ.P. 56(c)(4). That rule sets out the requirements for affidavits: (1) an affidavit must be based on “personal knowledge;” (2) it must “set out facts that would be admissible in evidence;” and (3) must “show that the affiant . . . is competent to testify on the matters stated.”
Mr. Koster and the Euroboor entities rely on the affidavits of Messrs. Gawande and Shahzad in their argument requesting summary judgment on Ms. Grafova's veil-piercing allegations. See, e.g., (doc. 199-1 at 7-8). Messrs. Gawande and Shahzad testified in their affidavits that each of the Euroboor entities operate independently of Mr. Koster; they testified, for example, that each Euroboor entity files its own tax returns and maintains its own books and financial statements. (Doc. 208-8 at 3; 208-18 at 3).
But, according to Ms. Grafova, Mr. Gawande does not have personal knowledge as to the operations of Euroboor FZC because his “employment with Euroboor FZC ceased in early 2019.” (Doc. 213 at 2). Ms. Grafova likewise claims that Mr. Shahzad does not have personal knowledge as to the operations of the other Euroboor entities because he “resigned from Euroboor FZC on January 26, 2019, ” ten months before he executed his affidavit. (Doc. 213 at 4). Ms. Grafova produced a resignation letter in which Mr. Shahzad purportedly resigned his employment from Euroboor FZC in January 2019. (Doc. 213 at 15).
But, as the Euroboor Plaintiffs point out, Ms. Grafova has only shown that Mr. Gawande transferred his visa sponsorship from Euroboor FZC to MEEBS, another entity associated with Mr. Koster that is not before this court. (Doc. 224 at 2; doc. 213 at 8, 10). Additionally, an email Ms. Grafova produced from Mr. Gawande shows that Mr. Gawande-as late as September 2020-still identified as an employee of Euroboor FZC. (Doc. 213 at 12-13). Accordingly, Ms. Grafova has not shown that Mr. Gawande does not have personal knowledge of the operations of Euroboor FZC at the relevant time.
As to Mr. Shahzad's affidavit, Mr. Koster subsequently filed an affidavit confirming that Mr. Shahzad still serves as the CFO of the Euroboor entities as of December 2020, regardless of the resignation letter produced by Ms. Grafova. (Doc. 224-1 at 2-3).
The court concludes that Ms. Grafova's motion to strike really goes to the credibility and weight of Messrs. Gawande and Shahzad's affidavits, given the conflicting evidence as to their employment status with the Euroboor entities. But courts may not weigh the evidence or make credibility determinations at the summary judgment stage. Lewis v. City of Union City, Ga., 934 F.3d 1169, 1179 (11th Cir. 2019) (citing Feliciano v. City of Miami Beach, 707 F.3d 1244, 1252 (11th Cir. 2013)).
And courts in the Eleventh Circuit generally only strike affidavits for lack of personal knowledge when the face of the affidavit shows that the affiant lacks personal knowledge as to the subject matter of his testimony; an affiant generally evidences his lack of personal knowledge through the use of words such as “based on my information and belief.” See, e.g., Prowell v. Ala. Dep't of Human Res., No. 2:10-cv-1993-VEH, 20120 WL 3848667, at *4 (N.D. Ala. Sept. 5, 2012) (citing Robbins v. Gould, 278 F.2d 116, 118 (5th Cir. 1960)).
On the other hand, courts in the Eleventh Circuit generally deny motions to strike when a movant bases its motion on nothing more than a question of the credibility of the affiant. See, e.g., Ultimax Transp. v. Brit. Airways, Inc., 231 F.Supp.2d 1329, 1335 (N.D.Ga. 2002) (the “objection relates solely to the credibility of the affiant and the weight that the testimony should be given, and does not provide a basis for striking the affidavit from the record”).
So the court will DENY Ms. Grafova's motion to strike the affidavits of Messrs. Gawande and Shahzad (doc. 213) and will leave the question of their credibility to the jury. But the court will consider their testimony for summary judgment purposes.
In a related vein, Ms. Grafova also asks the court to disregard the affidavit of Kristy Abraham, a Euroboor USA employee. (Doc. 225 at 3). According to Ms. Grafova, Ms. Abraham's affidavit is “inconsistent with” her prior deposition testimony. (Doc. 225 at 3 n.14). And Ms. Grafova is correct that the law of “[t]he Eleventh Circuit, in limited circumstances, allows a court to disregard an affidavit as a matter of law when, without explanation, it flatly contradicts his or her own prior deposition testimony for the transparent purpose of creating a genuine issue of material fact where none existed previously.” Furcron v. Mail Ctrs. Plus, LLC, 843 F.3d 1295, 1306 (11th Cir. 2016) (emphasis added).
But Ms. Grafova has not pointed to any portions of Ms. Abraham's affidavit that “flatly contradict” her deposition testimony; nor has Ms. Grafova shown that the Euroboor Plaintiffs produced Ms. Abraham's affidavit “for the transparent purpose of creating a genuine issue of material fact where none previously existed.” See Furcron, 843 F.3d at 1306. And the court has conducted its own independent review of Ms. Abraham's deposition (doc. 205-8) and her affidavit (doc. 220-2) and concludes that any discrepancies between the two again “relate[] solely to the credibility of the affiant and the weight that the testimony should be given, and do[] not provide a basis for striking the affidavit from the record.” See Ultimax Transp. v. Brit. Airways, Inc., 231 F.Supp.2d 1329, 1335 (N.D.Ga. 2002). So the court will consider Ms. Abraham's affidavit for summary judgment purposes.
The claims at issue for summary judgment purposes fall in to two broad categories: (1) claims arising out of the intersection of the failed business and personal relationship of Mr. Koster and Ms. Grafova; and (2) claims arising from a series of loans Ms. Grafova made to Euroboor FZC that Euroboor FZC has not repaid. The court will set out the facts of each category separately.
The “Euroboor group” of companies spans the globe and specializes in manufacturing portable industrial tools. At least four separate entities comprise the Euroboor group of companies: Euroboor B.V., a company incorporated under the laws of the Netherlands; Euroboor USA, a Delaware corporation with its principal place of business in Birmingham, Alabama Euroboor FZC, an LLC organized under the laws of the United Arab Emirates; and MEEBS, another UAE entity. (Doc. 205-1 at 38, 72). Albert Koster owns Euroboor B.V. and 80% of Euroboor FZC; Ms. Grafova owns the other 20% of Euroboor FZC. Euroboor B.V. owns Euroboor USA. (Doc. 205-1 at 36). Mr. Koster acts as the CEO of all Euroboor entities. (Doc. 205-1 at 72). See...
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