Gulf Oil Ltd. P'ship v. Petroleum Mktg. Grp., Inc.

• Citation: 308 F.Supp.3d 453
• Decision Date: 30 March 2018
• Docket Number: CIVIL ACTION NO. 17–10813–GAO
• Parties: GULF OIL LIMITED PARTNERSHIP, Plaintiff, v. PETROLEUM MARKETING GROUP, INC., and BP Products North America Inc., Defendants.
• Court: U.S. District Court — District of Massachusetts

308 F.Supp.3d 453

GULF OIL LIMITED PARTNERSHIP, Plaintiff,

v.PETROLEUM MARKETING GROUP, INC., and BP Products North America Inc., Defendants.

CIVIL ACTION NO. 17–10813–GAO

United States District Court, D. Massachusetts.

Signed March 30, 2018

Barry Goheen, Pro Hac Vice, Leslie M. Bassett, Pro Hac Vice, King & Spaulding, LLP, Atlanta, GA, Ariel Grayson Sullivan, Bowditch & Dewey, LLP, Framingham, MA, for Plaintiff.

Ralph T. Lepore, III, Benjamin M. McGovern, Jean–Phillip Brignol, Michael T. Maroney, Holland & Knight, LLP, Boston, MA, for Defendants.

OPINION AND ORDER

George A. O'Toole, Jr., United States District Judge

Gulf Oil Limited Partnership ("Gulf") alleges claims against BP Products North America ("BP") for tortious interference with contract and advantageous business relations or business expectancy (Count VI); violation of Massachusetts General Laws Chapter 93A, § 11 (Count VII); conspiracy under Virginia Code § 18.2–499, et seq. (Count VIII); and civil conspiracy (Count IX). Now pending before the Court is BP's motion under Federal Rule of Civil Procedure 12(b)(2) to dismiss the claims for lack of personal jurisdiction.

I. Factual Background

Gulf, a Delaware limited partnership with a principal place of business in Massachusetts, is a wholesaler of refined petroleum products, including diesel fuel and gasoline. Gulf utilizes a distribution network that supplies fuel products through seventeen terminals and more than 1,800 Gulf-branded gas and service stations. BP is incorporated in Maryland and has a principal place of business in Illinois. It operates BP gas stations in various States, including Massachusetts.

In 2016, co-defendant Petroleum Marketing Group ("PMG") acquired from Gulf 223 northeast and mid-Atlantic dealer-operated convenience stores and gas stations. PMG also entered into a Distributor Agreement with Gulf, pursuant to which PMG's newly acquired gas stations would continue to be branded with Gulf logos and Gulf would supply their fuel. The agreement detailed the parties' respective rights and responsibilities at length. Gulf and PMG are also parties to a number of other more or less related agreements that are apparently not germane to the present issues.

In late 2016 and early 2017, Gulf became concerned that PMG might be planning to lease to BP some of the stations it had acquired from Gulf. The Oil Express, an industry periodical, reported in February 2017 that BP was engaged in conversations with PMG to acquire some of the latter's Gulf-branded stations. The complaint alleges that the Oil Express article was circulated throughout the country, including in Massachusetts. Gulf argues in its brief that BP "triggered multiple false rumors to circulate that BP [was] buying some of Gulf's most valuable stations and Gulf [was] exiting the market," (Gulf's Resp. in Opp'n to BP's Mot. to Dismiss, 2 (dkt. no. 41) ), but there is no similar allegation in the complaint itself, nor are there any supporting factual allegations other than the quoted conclusory assertion set forth in the brief.

By letter dated April 21, 2017, PMG advised Gulf that it had entered into an agreement with BP pursuant to which PMG would lease seventy-six Gulf-branded sites to BP and that BP intended to use them to sell BP branded fuels. Gulf became concerned both with the potential loss of revenue under the Distributor Agreement from the conversion of Gulf stations to BP stations and with the adverse public relations effect of what might be seen as a substantial withdrawal from the retail market by Gulf. The sites at issue are located exclusively in New York and New Jersey.

The complaint alleges that BP, which had some knowledge of the ongoing business relationship between Gulf and PMG,¹ induced PMG to breach the Distributor Agreement and wrongfully colluded with PMG to convert stations from Gulf to BP stations. Gulf claims that it is losing millions of dollars as a result of BP's tortious interference.

II. Standard of Review

When a court's power to exercise personal jurisdiction over a defendant is challenged, the plaintiff bears the burden of establishing that the exercise of such jurisdiction is proper. A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 58 (1st Cir. 2016) (citing Phillips v. Prairie Eye Ctr., 530 F.3d 22, 26 (1st Cir. 2008) ). Under the commonly used "prima facie" approach, a court considers "whether [Gulf] has proffered evidence which, if credited, is sufficient to support findings of all facts essential to personal jurisdiction." Id. (quoting Phillips, 530 F.3d at 26 ). A court "must accept [Gulf's] properly documented evidentiary proffers as true and construe them in the light most favorable to [its] jurisdictional claim." Id. (citing Phillips, 530 F.3d at 26 ). However, the plaintiff is only entitled to credit for assertions that are supported by specific evidence, not for conclusory or unsupported allegations from its pleadings. Id. (quoting Platten v. HG Berm. Exempted Ltd., 437 F.3d 118, 134 (1st Cir. 2006) ). Allegations in legal memoranda alone are "insufficient ... to establish jurisdictional facts." Barrett v. Lombardi, 239 F.3d 23, 27 (1st Cir. 2001).

III. Discussion

The Due Process Clause of the Fourteenth Amendment to the United States Constitution limits the power of a State to subject nonresidents to binding adjudications by its courts. Bristol–Myers Squibb Co. v. Super. Ct. of Cal., ––– U.S. ––––, 137 S.Ct. 1773, 1779, 198 L.Ed.2d 395 (2017) ; J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 879–80, 131 S.Ct. 2780, 180 L.Ed.2d 765 (2011). However, a State may subject a nonresident to the judgments of its courts under circumstances where the nonresident's voluntary contacts with the State are such that the exercise of binding judicial power over a particular controversy would "not offend ‘traditional notions of fair play and substantial justice.’ " Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940) ). In particular,

[w]here a defendant "purposely avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws, [ Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958) ], it submits to the judicial power of an otherwise foreign sovereign to the extent that power is exercised in connection with the defendant's activities touching on the State.

J. McIntyre, 564 U.S. at 881, 131 S.Ct. 2780.

In deciding whether a defendant may properly be subjected to personal jurisdiction in a given forum, a court must consider "a variety of interests," including " ‘the interests of the forum State and of the plaintiff in proceeding with the cause in the plaintiff's forum of choice.’ " Bristol–Myers Squibb, 137 S.Ct. at 1780 (quoting Kulko v. Super. Ct. of Cal., 436 U.S. 84, 92, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978) ). But the court's " ‘primary concern’ is ‘the burden on the defendant,’ " id. (quoting World–Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) ), not only because there may be practical problems resulting from forcing a defendant to litigate in an inconvenient forum, but because the question of jurisdiction also implicates the "territorial limitations on the power of the respective States." Id. (citing Hanson, 357 U.S. at 251, 78 S.Ct. 1228 ). Each State has a sovereign interest in the power to try cases in its own courts, but "[t]he sovereignty of each State ... implie[s] a limitation on the sovereignty of all its sister States." Id. at 1780 (quoting World–Wide Volkswagen, 444 U.S. at 293, 100 S.Ct. 580 ).

Even if the defendant would suffer minimal or no inconvenience from being forced to litigate before the tribunals of another State; even if the forum State has a strong interest in applying its law to the controversy; even if the forum State is the most convenient location for litigation, the Due Process Clause, acting as an instrument of interstate federalism, may sometimes act to divest the State of its power to render a valid judgment.

World–Wide Volkswagen, 444 U.S. at 294, 100 S.Ct. 580. The liberty protected by the Due Process Clause includes the "right to be subject only to lawful power." J. McIntyre, 564 U.S. at 884, 131 S.Ct. 2780.

This Court's exercise of personal jurisdiction over a defendant is proper only if the requirements of both the Massachusetts long-arm statute, Massachusetts General Laws Chapter 223A, Section 3, and the Due Process Clause are satisfied. A Corp., 812 F.3d at 58.

Gulf's complaint adequately alleges a statutory basis for jurisdiction at least under section 3(d) of the long-arm statute. The question here is whether the exercise of personal jurisdiction over BP for the claims alleged in the complaint would be proper under the Due Process Clause.

A. General Jurisdiction

The doctrine of general jurisdiction, sometimes called "all-purpose jurisdiction," authorizes a court to adjudicate any claim against a defendant, regardless of where the events giving rise to the claim had occurred. Bristol–Myers Squibb, 137 S.Ct. at 1780. This doctrine has been applied to establish jurisdiction over foreign corporations—that is, those not incorporated under the forum's law—"when their affiliations with the State are so ‘continuous and systematic’ as to render them essentially at home in the forum State." Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919, 131 S.Ct. 2846, 180 L.Ed.2d 796 (2011) (citing Int'l Shoe, 326 U.S. at 317, 66 S.Ct. 154 ). A corporation that is sufficiently "at home" in the forum is treated as a resident of that State and thus subject to the general jurisdiction of the State's courts.

BP has a sizable economic presence in Massachusetts, and formerly a plausible case might have been made for exercising general jurisdiction over it. No longer. The Supreme Court has held and reiterated that a corporate defendant is...