MILFORD POWER LTD. PARTNER. v. New England Power

• Decision Date: 14 March 1996
• Docket Number: Civil Action No. 94-40180-NMG.
• Citation: 918 F. Supp. 471
• Parties: MILFORD POWER LIMITED PARTNERSHIP, by its general partner MILFORD POWER ASSOCIATES, INC., Plaintiff and Defendant-in-Counterclaim, v. NEW ENGLAND POWER COMPANY, Defendant and Plaintiff-in-Counterclaim, v. ENRON CORP., Enron Power Marketing, Inc., Jones Capital Corp., and Jones Medway, Inc., Additional Defendants-in-Counterclaim.
• Court: U.S. District Court — District of Massachusetts

918 F. Supp. 471

MILFORD POWER LIMITED PARTNERSHIP, by its general partner MILFORD POWER ASSOCIATES, INC., Plaintiff and Defendant-in-Counterclaim, v. NEW ENGLAND POWER COMPANY, Defendant and Plaintiff-in-Counterclaim, v. ENRON CORP., Enron Power Marketing, Inc., Jones Capital Corp., and Jones Medway, Inc., Additional Defendants-in-Counterclaim.

Civil Action No. 94-40180-NMG.

United States District Court, D. Massachusetts.

March 14, 1996.

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R. Robert Popeo, Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C., Boston, MA, for Milford Power Ltd.

Michael P. Angelini, Vincent F. O'Rourke, Jr., Barry A. Bachrach, Mark W. Powers, Bowditch & Dewey, Worcester, MA, for New England Power Company.

Michael P. Angelini, Bowditch & Dewey, Worcester, MA, for New England Power Co.

R. Robert Popeo, Paul D. Wilson, Alan S. Gale, Joseph P. Messina, Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C., Boston, MA, for Enron Corp., Jones Capital Corp.

MEMORANDUM AND ORDER

GORTON, District Judge.

Plaintiff Milford Power Limited Partnership ("Milford"), an electric power producer, is a Massachusetts company with its principal place of business, a gas-fired power plant, in Milford, Massachusetts. Milford, by its general partner, Milford Power Associates, Inc. ("MPAI"), brings this action against defendant, New England Power Company ("NEP"), alleging various torts, breaches of contract and statutory violations.

NEP, a wholly-owned subsidiary of New England Electric System, is a regulated public utility engaged in the business of 1) generating and purchasing electric power, which it sells on a wholesale basis to affiliated retail electric utility companies, and 2) purchasing natural gas, which it uses as a fuel in its own power plants or sells to other power companies, such as Milford. NEP has denied Milford's claims and filed a counterclaim against Milford, MPAI and their affiliates.

Pending before this Court are the following motions:

1. Motion of defendant NEP to strike portions of the affidavit of Alan L. Hodges, the Vice President of MPAI;

2. Motion of additional defendants-in-counterclaim, Enron Corp. and Jones Capital Corp., to dismiss for lack of personal jurisdiction;

3. Motion of defendant-in-counterclaim, Milford, its general partner MPAI, and additional defendants-in-counterclaim, Enron Power Marketing, Inc. and Jones Medway, Inc., to dismiss counterclaims for failure to state a claim;

4. Special Motion of defendant-in-counterclaim, Milford, its general partner MPAI, and additional defendants-in-counterclaim, Enron Corp., Enron Power Marketing, Inc., Jones Capital Corp. and Jones Medway, Inc., to dismiss pursuant to M.G.L. c. 231, § 59H; and

5. Motion of defendant NEP to stay or dismiss proceedings on grounds of primary jurisdiction.

This Court will address the motions seriatim.

I. Background

In December, 1989, NEP agreed to buy 56% (83 out of 149 megawatts) of the capacity and energy of a power plant that Milford had proposed to build in Milford, Massachusetts (the "Milford Plant"), pursuant to a Purchase Power Agreement. Earlier in 1989, NEP had decided to build a larger power plant (450 megawatts) of its own on Manchester Street in Providence, Rhode Island (the "Manchester Street Plant").

Milford alleges that:

1. in early 1990, NEP became aware that its prior energy forecasts had been overstated,

2. NEP concluded that it did not need energy from both the Milford Plant and the Manchester Street Plant,

3. despite the lower energy forecasts, NEP decided to proceed with its plan to develop the Manchester Street Plant,

4. in order to obtain permission from the Rhode Island Energy Facilities Siting Board (the "Rhode Island Board") to build the Manchester Street Plant, NEP intentionally misrepresented the forecasts for energy demand in New England, and

5. because it no longer needed the 56% capacity of the Milford Plant, and because it had committed to buy that capacity at what turned out to be an inflated price, NEP wrongfully attempted to cause Milford and the Milford Plant to fail.

Milford's Complaint alleges various counts of violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1962 and 1964, deceit/fraudulent inducement, negligent misrepresentation, breaches of contract and the covenant of good faith and fair dealing, interference with advantageous business relations, and violation of M.G.L. c. 93A.

NEP denies Milford's claims and has filed a counterclaim against Milford and its general partner, MPAI, and against Enron Corp., Enron Power Marketing, Inc., Jones Capital Corp., and Jones Medway, Inc. as additional defendants-in-counterclaim. In its counterclaims, NEP alleges that Milford and its affiliates participated in a civil conspiracy to blackmail NEP into buying either exorbitantly expensive electric power or the Milford Plant itself. That extortionate plan was allegedly intended to bail Milford and its affiliates out of the consequences of their ill-advised decision to build the Milford Plant and culminated in a meeting with NEP on October 21, 1994 in Westboro, Massachusetts (the "October Meeting"), at which alleged threats were made to NEP. NEP maintains that because it refused to be blackmailed, Milford filed this lawsuit against it and issued a news release alleging various wrong-doings. NEP thus claims that the defendants-in-counterclaim are liable to it for civil conspiracy, defamation, abuse of process, violation of M.G.L. c. 93A and breaches of contract and the covenant of good faith and fair dealing.

II. Motion of NEP to Strike Portions of the Affidavit of Alan L. Hodges

In support of its Motion to Dismiss for Lack of Personal Jurisdiction, Enron Corp. has submitted an affidavit from Alan L. Hodges (the "Hodges Affidavit"), vice president of MPAI. NEP seeks to strike paragraphs four and five of that affidavit, in which Mr. Hodges states that he prepared a certain document and that Richard Kinder, as a representative of MPAI and at Hodges' request, presented that document to NEP at the October Meeting in Westboro, Massachusetts. The paragraphs at issue read as follows:

4. On October 21, 1994, Milford met with NEP in Westboro, Massachusetts. In preparation for the meeting, I prepared a document which Milford presented to NEP at that meeting. Because I was acting as an officer of Milford's general partner, MPAI, I used the letterhead of MPAI and created a signature line for myself as Vice President of MPAI, the managing general partner of Milford.

5. Richard Kinder and Kenneth Rice, officers of corporate affiliates of MPAI, represented the interest of MPAI, as owners of MPAI, at the meeting with NEP on October 21, 1994. At my request on behalf of MPAI, they delivered to NEP, on behalf of Milford's managing general partner MPAI, the document which I had prepared.

NEP argues that because Mr. Hodges was not at the October Meeting, he has no personal knowledge from which to testify about the events that took place at the meeting, including who presented the documents to NEP. In support of that argument, NEP relies upon Fed.R.Civ.P. 56(e), which provides that affidavits submitted in the summary judgment context "shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein." NEP is apparently asking this Court to apply those standards to affidavits submitted in the instant Rule 12 motion to dismiss for lack of personal jurisdiction.

Defendants-in-counterclaim, Enron Corp. and Jones Capital Corp., oppose NEP's motion to strike because they claim that the Hodges Affidavit is based upon Mr. Hodges' personal knowledge and provides admissible facts to which Mr. Hodges may testify.

In ruling on a motion to dismiss for lack of personal jurisdiction, this Court may go beyond the four corners of the pleadings and consider materials presented in support of that motion. Goldman, Antonetti, Ferraiuoli, Axtmayer & Hertell v. Medfit Int'l, Inc., 982 F.2d 686, 690 (1st Cir.1993). Because a motion to dismiss for lack of personal jurisdiction seeks the same relief as a motion for summary judgment, the First Circuit Court of Appeals has found that "the difference in name is unimportant. In any event, the affidavits presented are available on either motion." American Express Int'l, Inc. v. Mendez-Capellan, 889 F.2d 1175, 1178 (1st Cir.1989) (citation omitted). It follows, then, that this Court may consider affidavits submitted in support of the instant motion to dismiss if they are based on the personal knowledge of a competent affiant.

This Court concludes that, with the exception of the last sentence of paragraph four, defendants-in-counterclaim have not shown that the remainder of paragraphs four and five were based upon Mr. Hodges' personal knowledge. At this stage in the litigation, however, the Court will receive the Hodges Affidavit for "what it is worth", New England Anti-Vivisection Soc., Inc. v. United States Surgical Corp., Inc., 889 F.2d 1198, 1204 (1st Cir.1989) (affirming the district judge's denial of a motion to strike an affidavit for lack of personal knowledge as within the judge's discretion), and the motion to strike by NEP will be DENIED.

III. Motion of Enron Corp. and Jones Capital Corp. to Dismiss for Lack of Personal Jurisdiction

Enron Corp. ("Enron") and Jones Capital Corp. ("Jones Capital") have appeared specially to file, pursuant to Fed.R.Civ.P. 12(b)(2), a motion to dismiss NEP's counterclaims against them for lack of personal jurisdiction.

Enron is a Delaware corporation with its principal place of business in Houston, Texas. Enron is the largest natural gas pipeline operator and one of the largest independent producers of oil and gas in the United States, with assets and annual revenues in the billions...