Fidenas AG v. Compagnie Internationale Pour L'Informatique CII Honeywell Bull. S. A., Nos. 784

CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)
Writing for the CourtBefore GURFEIN and MESKILL; MESKILL; Frankel
Citation606 F.2d 5
Decision Date06 August 1979
Docket NumberNos. 784,D,785
Parties, Fed. Sec. L. Rep. P 96,947 CA 79-3030 FIDENAS AG, Sidesco International Ltd., and Mr. G. P. Jurick, Plaintiffs-Appellants, v. COMPAGNIE INTERNATIONALE POUR L'INFORMATIQUE CII HONEYWELL BULL S.A.; Compagnie Honeywell Bull S.A., Honeywell Bull (Schweiz) A.G., Honeywell Information Services A.G., Honeywell AG, Bull Holding S.A., Josef Grandi and Maxime Bonnet, Defendants-Appellees. ockets 78-7458, 79-7055.

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606 F.2d 5
56 A.L.R.Fed. 278, Fed. Sec. L. Rep. P 96,947
CA 79-3030 FIDENAS AG, Sidesco International Ltd., and Mr.
G. P. Jurick, Plaintiffs-Appellants,
v.
COMPAGNIE INTERNATIONALE POUR L'INFORMATIQUE CII HONEYWELL
BULL S.A.; Compagnie Honeywell Bull S.A., Honeywell Bull
(Schweiz) A.G., Honeywell Information Services A.G.,
Honeywell AG, Bull Holding S.A., Josef Grandi and Maxime
Bonnet, Defendants-Appellees.
Nos. 784, 785, Dockets 78-7458, 79-7055.
United States Court of Appeals,
Second Circuit.
Argued April 30, 1979.
Decided Aug. 6, 1979.

James C. Sargent, New York City (David G. Taylor, Gary P. Rosenthal, Whitman & Ransom, New York City, of counsel), for plaintiffs-appellants.

David S. Patterson, New York City (Donald B. da Parma, Alan C. Drewsen, Breed, Abbott & Morgan, New York City, of counsel), for defendants-appellees.

Before GURFEIN and MESKILL, Circuit Judges, and WYZANSKI, * District Judge.

MESKILL, Circuit Judge:

This is an appeal from a judgment entered in the United States District Court for the Southern District of New York, Marvin E. Frankel, Judge, dismissing a complaint brought primarily under § 10(b) of the Securities Exchange Act of 1934, 15

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U.S.C. § 78j(b), and Securities and Exchange Commission Rule 10b-5, 17 C.F.R. § 240.10b-5. The district court determined both that it lacked subject matter jurisdiction and that the plaintiffs lacked standing to pursue their claims under the statute, each determination being sufficient and independent reason for ordering dismissal. The court also determined that it lacked in personam jurisdiction over all but two of the defendants, and that the forum non conveniens argument put forth by the defendants was "persuasive." After the district court had entered its order, and after a notice of appeal had been filed, appellants moved for relief pursuant to Fed.R.Civ.P. 60(b)(2). The district court, per Milton Pollack, Judge, determined that the allegedly new evidence tendered by the plaintiffs "warrant(ed) no change" in Judge Frankel's decision and that, "even if the Court were disposed to grant the motion, it would not have jurisdiction to do so unless the case were remanded by the Court of Appeals." Appellants ask us to reverse Judge Frankel's decision and to review Judge Pollack's order. We decline to do either, basing our decision on the "fundamentally preliminary" defect in the appellants' case lack of subject matter jurisdiction. 1 Leroy v. Great Western United Corp., --- U.S. ----, ----, 99 S.Ct. 2710, 61 L.Ed.2d 464 (1979).

The plaintiffs in this action are a Swiss company by the name of Fidenas AG, a Bahamian company by the name of Sidesco International Ltd., and a German citizen residing in Switzerland by the name of G. P. Jurick. Jurick is described as the "managing executive" of Fidenas and Sidesco. It appears that he and his family own all of the Fidenas and Sidesco stock. On this appeal, the plaintiffs describe themselves as "international dealers in commercial paper and financial advisers" and as being "engaged in the business of financing and arranging financing for companies." The central defendant is a Swiss computer sales company operating exclusively in Switzerland under the name of Honeywell Bull (Schweiz) A.G., hereafter referred to as "HBS." Also sued is Compagnie Internationale Pour L'Informatique CII Honeywell Bull S.A., referred to as "CII-HB," and Compagnie Honeywell Bull S.A., referred to as "CHB." CII-HB is a French company, partly owned by Honeywell Information Systems, Inc., and engaged in the production and sale of computers and peripheral equipment; CII-HB is HBS's current "parent." CHB, also a French company and also partly owned by Honeywell Information Systems, Inc., preceded and eventually merged into CII-HB; CHB was HBS's "parent" at the time of the transactions that gave rise to this suit. In addition, the plaintiffs named as defendants (1) Honeywell Information Services AG, a Swiss company owned by a French company which in turn is owned partly by Honeywell Information Services, Inc., engaged in the sale of computer time sharing services; (2) Honeywell AG, a Swiss subsidiary of Honeywell, Inc., located in Minneapolis, Minnesota, engaged in the sale of controls for commercial and residential customers; and (3) Bull Holding S.A., a Swiss subsidiary of CII-HB existing solely as a holding company. Finally, the plaintiffs named as defendants two individuals by the names of Josef Grandi, a Swiss citizen and resident working as managing director of HBS, and Maxime Bonnet, a French citizen and resident working as a marketing executive for CII-HB.

According to the plaintiffs, "(t)his case involves a multi-national fraud and conspiracy of world-wide proportions involving events and parties in at least six countries the United States, Canada, France, Switzerland, Liechtenstein and the Bahamas." The facts asserted to support this characterization are as follows. 2 In late

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1972, Jurick was introduced to Roland Staempfli, then working as HBS's chief financial officer. As a result of this meeting, Fidenas arranged a financing for HBS in the amount of DM 3,500,000 through the issuance of one-year promissory notes. Sidesco purchased the first four of these notes in December of 1972 and immediately sold them to Bishops Bank and Trust Co., Ltd., the predecessor of the Bishops International Bank Ltd., which in turn is an affiliate of the National Westminster Bank and the Royal Bank of Canada, located in Nassau, Bahamas. Almost a year later, another note financing took place. This note, for DM 4,000,000, was apparently intended to provide funds to cover the original notes, was not to mature until July of 1975 and was placed by the plaintiffs directly with Bishops Bank. The plaintiffs also entered into an underwriting agreement which lasted between late 1973 and early 1975, pursuant to which the plaintiffs sold HBS notes to various of its customers, including the Merban Corporation in New York City. These notes were in turn sold by Merban to other financial institutions.

As it turns out, the HBS notes were fraudulent, having been prepared and forged by Staempfli. The proceeds of these notes were apparently invested by Staempfli in speculative ventures through a Canadian company called Chemalloy Minerals Ltd., a firm which was hoping to develop natural

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gas fields in Texas. Chemalloy went bankrupt, however, and virtually all of the proceeds of the notes were lost. On February 7, 1979, Staempfli was convicted of criminal fraud and was sentenced by the Zurich Court to four and one-half years in prison. In the meantime, the fraud having been discovered and announced, and various of the HBS notes having fallen due, those left holding the notes understandably sought their redemption. HBS, denying responsibility for the fraudulently issued notes, declined to honor them, a decision leading to a number of suits in Switzerland against HBS. None of the purchasers of the unredeemed notes is a party to this action. 3 Also in the meantime, the plaintiffs had lost their principal American customer, Merban Corporation, and, at least in their estimation, began to suffer the consequences of a reputation tarnished by involvement with the HBS notes. Although this summary does not exhaust the factual allegations contained in plaintiffs' complaint, it represents the essential core of those assertions, at least for purposes of this appeal.

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29 practice notes
  • American Can Co. v. Mansukhani, No. 83-2553
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • August 10, 1984
    ...held that the petitioner's showing was sufficient to justify issuance of an order "narrow in scope and brief in its duration." 606 F.2d at 5. American Can argues that it "entertained the same fears as Vuitton." Appellee's Brief at 40. American Can asserts that notice of ......
  • Dept. of Economic Dev. v. Arthur Andersen & Co., No. 85 Civ. 1292(CES).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • April 5, 1988
    ...jurisdiction under the securities laws is disputed. Fidenas AG v. Compagnie Internationale Pour l'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 6-7 n. 2 (2d Cir.1979) (quoting Venture Fund (International) N.V. v. Willkie Farr & Gallagher, 418 F.Supp. 550, 555 (S.D.N.Y.1976)). Determ......
  • In re Scor Holding (Switzerland) Ag Litigation, Master File No. 04 Civ. 7897(DLC).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • March 6, 2008
    ...resolved in the courts of another land." Fidenas AG v. Compagnie Internationale Pour L'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 10 (2d II. Requirements for Class Certification "[A] district judge may certify a class only after making determinations that each of the Rule 2......
  • In Re European Aeronautic Defence & Space Co. Securities Litigation., No. 08 Civ. 5389(WHP).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • March 26, 2010
    ...Inc., 519 F.2d 974, 985 (2d Cir.1975)); see also Fidenas AG v. Compagnie Internationale Pour L'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 10 (2d Cir.1979) (“Fraud there might have been, and plaintiffs may very well have been damaged by its perpetration. But the dispute here presented......
  • Request a trial to view additional results
29 cases
  • American Can Co. v. Mansukhani, No. 83-2553
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • August 10, 1984
    ...Circuit held that the petitioner's showing was sufficient to justify issuance of an order "narrow in scope and brief in its duration." 606 F.2d at 5. American Can argues that it "entertained the same fears as Vuitton." Appellee's Brief at 40. American Can asserts that notice of its ex parte......
  • Dept. of Economic Dev. v. Arthur Andersen & Co., No. 85 Civ. 1292(CES).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • April 5, 1988
    ...jurisdiction under the securities laws is disputed. Fidenas AG v. Compagnie Internationale Pour l'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 6-7 n. 2 (2d Cir.1979) (quoting Venture Fund (International) N.V. v. Willkie Farr & Gallagher, 418 F.Supp. 550, 555 (S.D.N.Y.1976)). Determinin......
  • In re Scor Holding (Switzerland) Ag Litigation, Master File No. 04 Civ. 7897(DLC).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • March 6, 2008
    ...is rightfully resolved in the courts of another land." Fidenas AG v. Compagnie Internationale Pour L'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 10 (2d II. Requirements for Class Certification "[A] district judge may certify a class only after making determinations that each of the Ru......
  • In Re European Aeronautic Defence & Space Co. Securities Litigation., No. 08 Civ. 5389(WHP).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • March 26, 2010
    ...Inc., 519 F.2d 974, 985 (2d Cir.1975)); see also Fidenas AG v. Compagnie Internationale Pour L'Informatique CII Honeywell Bull S.A., 606 F.2d 5, 10 (2d Cir.1979) (“Fraud there might have been, and plaintiffs may very well have been damaged by its perpetration. But the dispute here presented......
  • Request a trial to view additional results

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