Exter Shipping Ltd. v. Kilakos

• Decision Date: 29 March 2004
• Docket Number: No. 1:02-CV-1665-TWT.,No. 1:02-CV-1443-TWT.,No. 1:02-CV-1666-TWT.,No. 1:02-CV-1667-TWT.,1:02-CV-1443-TWT.,1:02-CV-1665-TWT.,1:02-CV-1666-TWT.,1:02-CV-1667-TWT.
• Parties: EXTER SHIPPING LIMITED, Plaintiff, v. Stamatios I. KILAKOS, et al., Defendants. Crest Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants. Stanley Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants. Wyndham Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants.
• Court: U.S. District Court — Northern District of Georgia

310 F.Supp.2d 1301

EXTER SHIPPING LIMITED, Plaintiff, v. Stamatios I. KILAKOS, et al., Defendants.

Crest Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants.

Stanley Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants.

Wyndham Shipping Limited, Plaintiff, v. Stamatios I. Kilakos, et al., Defendants.

No. 1:02-CV-1443-TWT.

No. 1:02-CV-1665-TWT.

No. 1:02-CV-1666-TWT.

No. 1:02-CV-1667-TWT.

United States District Court, N.D. Georgia, Atlanta Division.

March 29, 2004.

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Laura Lewis Owens, Shannon Thyme Klinger, Alston & Bird, Atlanta, GA, Stephan Skoufalos, phv Manuel R. Llorca, phv, Skoufalos Llorca & Ziccardi Stamford, CT, for plaintiff.

Thomas J. Strueber, J. David Hopkins, Paul T. Kim, Jonathan R. Friedman, Lord Bissell & Brook, Paul Joseph Murphy, Cheri A. Grosvenor, Komal Patel, David M. Chaiken, King & Spalding, Cheryl L. Haas-Goldstein, Sutherland Asbill & Brennan, Elizabeth White, Boswell, Smith Moore, Atlanta, GA, for defendant.

ORDER

THRASH, District Judge.

These actions for breach of contract, indemnity and fraud arise out of contracts to ship cargoes of oil in international commerce. The Plaintiffs are four Maltese shipping companies. The Defendants are citizens of Greece. The cases are before the Court on the Defendants' Motions to Dismiss for Lack of Personal Jurisdiction, the Defendants' Motions to Dismiss Pursuant to the Doctrine of Forum Non Conveniens, and the Defendants' Motions to Dismiss for Lack of Subject Matter Jurisdiction. In summary, although the Court has subject matter jurisdiction, the Plaintiffs have failed to demonstrate that the Defendants have sufficient connection with this forum to permit this Court to exercise jurisdiction over them. Alternatively, as public and private interests favor the adjudication of this dispute in alternative fora, the Court declines to exercise jurisdiction pursuant to the doctrine of forum non conveniens. Thus, for the reasons set forth below, the Defendants' Motions to Dismiss for Lack of Personal Jurisdiction are GRANTED, the Defendants' Motions to Dismiss Pursuant to the Doctrine of Forum Non Conveniens are GRANTED, and the Defendants' Motions to Dismiss for Lack of Subject Matter Jurisdiction are DENIED.

I. BACKGROUND

Plaintiffs Exter Shipping Ltd. ("Exter," the owner of the Shoko), Crest Shipping Ltd. ("Crest," the owner of the Epic), Stanley Shipping Ltd. ("Stanley," the owner of the Cherry), and Wyndham Shipping Ltd. ("Wyndham," the owner of the Addax) are four Maltese shipping companies. The Plaintiffs are managed by Dynacom Tankers Management, Ltd. ("Dynacom"), a company headquartered in Greece. In 1996 and 1997, the Plaintiffs entered into time charter agreements with Metro Trading International, Inc. ("Metro Trading"), a Liberian company engaged in the purchase, sale, and shipment of oil. Pursuant to these contracts, the Plaintiffs chartered their vessels to Metro Trading for the purpose of transporting oil to and from Metro Trading's storage facility off the coast of Fujairah in the United Arab Emirates.

In February 1998, Metro Trading became insolvent. The storage facility contained less oil than was required to satisfy Metro Trading's liabilities for delivery of the product. Numerous parties in Europe and Asia, including the Plaintiffs, asserted competing rights to Metro Trading's assets. The English courts appointed a receiver to sell the oil remaining in storage and afloat. About $50 million was collected by the receiver for the benefit of the conflicting claimants which included oil companies such as Glencore International AG ("Glencore"), banks which financed Metro Trading, purchasers of the oil, ship owners and insurers. In the United Kingdom, about 35 actions were filed involving some 50 parties. On February 16, 1998, the Plaintiffs obtained a judgment against Metro Trading for $2.8 million, an amount secured by the oil then on board the Plaintiffs' vessels. This amount was allegedly secured to satisfy unpaid hire and bunker charges or damages under the time charters with Metro Trading. This led Glencore, a European oil trader using Metro Trading's Fujairah facility, to intervene. Asserting that the Plaintiffs diverted oil which was supposed to have been delivered to Metro Trading's Fujairah facility, Glencore filed in rem admiralty actions in the United Kingdom against the Plaintiffs, securing the "arrests" of the Plaintiffs' vessels. One vessel was arrested in England and three were arrested in Singapore. Glencore also successfully sued the Plaintiffs in the United Kingdom for conversion. The Queen's Bench Division found that the oil that the Plaintiffs had transported rightfully belonged to Glencore.

After participating in the United Kingdom litigation, on July 23, 2001, the Plaintiffs filed suit in this Court against Glencore, Metro Trading, and a purported Metro Trading-Glencore joint venture. Stanley Shipping Ltd., et al. v. Metro Trading International, Inc., et al., No. 1:01-CV-1929-TWT. That case raised claims and issues similar to those adjudicated or to be adjudicated in the English proceedings. In response, on July 31, 2001, Glencore applied to the Queen's Bench Division for an antisuit injunction barring the Plaintiffs from prosecuting the action in this Court. The Queen's Bench Division granted Glencore's request on November 8, 2001, and the English Court of Appeal unanimously affirmed this grant on April 18, 2002. In response, the Plaintiffs dismissed the action in this Court.

The Plaintiffs then filed this action. The Plaintiffs named as Defendants Rima Marine, the Swedish entity that allegedly negotiated the disputed time charter agreements with the Plaintiffs on Metro Trading's behalf, and its alleged principal, Jarl Dittmer, a resident and citizen of Sweden. Additionally, the Plaintiffs named four residents and citizens of Greece as Defendants: Ioannis Mavrakakis, Stamatios I. Kilakos ("S. Kilakos"), Ioannis S. Kilakos ("I. Kilakos"), and Margarita Gene. The Plaintiffs allege that Mavrakakis is a former principal of Metro Trading and that S. Kilakos, I. Kilakos, and Gene served as principals of Metro Trading during the relevant time period. Finally, the Plaintiffs also named as Defendant Mayamar Marine Enterprises, S.A. ("Mayamar"), a Panamanian corporation domiciled in Greece that is owned by Mavrakakis and served as broker for Rima Marine. The Plaintiffs have since dismissed Defendants Rima Marine and Dittmer from this action.

The Plaintiffs allege that the Defendants conspired to misrepresent Metro Trading's financial viability to induce the Plaintiffs to enter into the time charter contracts at issue. The Plaintiffs also allege that the Defendants depleted Metro Trading of its assets through fraudulent conveyances. The Plaintiffs claim that these actions caused Metro Trading's collapse, the arrests of the Plaintiffs' vessels, litigation expenses to defend against Glencore's conversion claims, and damages resulting from the Plaintiffs' inability to use or charter their vessels. The Defendants move for dismissal of the Plaintiffs' claims based on lack of subject matter jurisdiction, lack of personal jurisdiction and forum non conveniens.

II. DISCUSSION

A. Subject Matter Jurisdiction

The Defendants move to dismiss this action for lack of subject matter jurisdiction. Specifically, the Defendants maintain that the operative facts as alleged in the Plaintiffs' complaints and the applicable law demonstrate that the Plaintiffs have not satisfied the requirements of federal admiralty jurisdiction pursuant to 28 U.S.C. § 1333. Article II, section 2, of the United States Constitution extends the judicial power of the United States "to all Cases of admiralty and maritime Jurisdiction." Section 1333 provides, in relevant part, that "[t]he district courts shall have original jurisdiction, exclusive of the courts of the States, of ... [a]ny civil case of admiralty or maritime jurisdiction." 28 U.S.C. § 1333(1). The test for determining the existence of admiralty jurisdiction pursuant to section 1333(1) varies depending on whether the claims are predicated upon contract or tort. Broughton v. Florida Intern. Underwriters, Inc., 139 F.3d 861, 864 (11th Cir.1998); Harville v. Johns-Manville Products Corp., 731 F.2d 775, 780 n. 4 (11th Cir.1984).

1. Maritime Contract Jurisdiction

In order to invoke admiralty jurisdiction for a contract claim, the underlying contract must be "wholly maritime in nature, or any nonmaritime elements must be either insignificant or separable." Wilkins v. Commercial Inv. Trust Corp., 153 F.3d 1273, 1276 (11th Cir.1998). A contract qualifies as "maritime" if its "subject matter is necessary to the operation, navigation or management of a ship...." Id. The charterparty agreements between the Plaintiffs and Metro Trading involved the operation, navigation, and management of the Plaintiffs' ships. Thus, as the Plaintiffs assert and the Defendants necessarily concede, the charterparty agreements between the Plaintiffs and Metro Trading certainly constitute maritime contracts.

The Defendants, however, do not concede that the maritime nature of the contracts is dispositive of subject matter jurisdiction. First, the Defendants contend that, although the contracts between the Plaintiffs and Metro Trading are maritime contracts, maritime contract jurisdiction is not proper, as the named Defendants were not party to these contracts. See Continental Cameras Co., Inc. v. Foa & Son Corp., 658 F.Supp. 287, 289 (S.D.N.Y.1987), aff'd, 837 F.2d 45 (2d Cir.1987) (holding that a federal court lacked jurisdiction over a claim brought by an insured against an insurance broker, as the broker was not a party to the underlying maritime contract). The Plaintiffs cite the Arios Pagos decision of the Greek Supreme Court as the principal support for their assertions that Metro Trading is a de...