Mm Global Services Inc. v. Dow Chemical Co.
| Decision Date | 12 December 2005 |
| Docket Number | No. CIV. 302CV1107AVC.,CIV. 302CV1107AVC. |
| Citation | 404 F.Supp.2d 425 |
| Parties | MM GLOBAL SERVICES INC., MM Global Services Pte. Ltd., and Megavisa Solutions (S) Pte. Ltd., Plaintiffs v. THE DOW CHEMICAL COMPANY, Union Carbide Corporation, and Union Carbide Asia Pacific, Inc., Union Carbide Customer Services Pte. Ltd., and Dow Chemical Pacific (Singapore) Pte. Ltd., Defendants. |
| Court | U.S. District Court — District of Connecticut |
Alicia L. Downey, Bingham McCutchen, LLP, Boston, MA, Richard S. Taffet, Bingham McCutchen, New York, NY, Robert M. Langer, Steven Bruce Malech, Wiggin & Dana, Hartford, CT, Suzanne Ellen Wachsstock, Wiggin & Dana, Stamford, CT, for Plaintiffs.
Andrew S. Marovitz, Britt M. Miller, Dana S. Douglas, Mayer Brown Rowe & Maw LLP, Andrew G. Klevorn, Nathan P. Eimer, Ryan S. Hedges, Scott C. Solberg, Vanessa G. Jacobsen, Eimer Stahl Klevorn & Solberg, LLP, Chicago, IL, Christopher J. Kelly, Mayer Brown Rowe & Maw LLP, Washington, DC, Craig A. Raabe, Jason Marc Kuselias, Robinson & Cole, Hartford, CT, for Defendants.
This is an action for damages arising out of a business arrangement pursuant to which the plaintiffs purchased chemicals, polymers, and other products from the defendants and resold them to customers located in India. The amended complaint alleges violations of the Sherman Antitrust Act, 15 U.S.C. § 1, and common law tenets concerning breach of contract and negligent misrepresentation.
The plaintiffs, MM Global Services, Inc., MM Global Services Pte. Ltd., and Megavisa Solutions (S) Pte. Ltd. (collectively, "plaintiffs") have filed the within motion to vacate a previous order of the court dismissing two party defendants, Union Carbide Customer Services Pte. Ltd. ("UCCS") and Dow Chemical Pacific (Singapore) Private Ltd. ("Dow Singapore"), for lack of personal jurisdiction. The issue presented is whether, in light of new evidence obtained through personal jurisdiction discovery, the court has personal jurisdiction over the defendants, UCCS and Dow Singapore.
For the reasons that hereinafter follow, the court concludes that it does have personal jurisdiction with respect to UCCS and Dow Singapore. The motion to vacate the order granting rule 12(b)(2) motions to dismiss for lack of personal jurisdiction is therefore GRANTED.
Examination of the amended complaint and supplemental documents, including affidavits and exhibits submitted in connection with the instant motion, set forth the following undisputed material facts.
The defendant, Union Carbide Corporation ("Union Carbide") is engaged in the manufacture and sale of chemicals, polymers, and other specialty products to customers located in the United States and throughout the world. Union Carbide is incorporated in New York and has its corporate headquarters and principal place of business in Danbury, Connecticut.
In December 1984, lethal gas escaped from Union Carbide's plant in Bhopal, India. The leak caused the death of 3,800 persons and injuries to an additional 200,000.1
Union Carbide thereafter ceased selling products directly to customers in India. In 1987, Union Carbide appointed the plaintiff, Mega Vista Marketing Solutions Ltd. ("MVMS") as a non-exclusive distributor to maintain Union Carbide's access to the Indian marketplace. In 1993, Union Carbide requested that MVMS form separate corporate affiliates and open offices outside of India that would buy Union Carbide products in the United States and resell them to end-users in India.
Over the next decade, Union Carbide would distribute its products, according to differing agreements, in Asia through other entities, including: (1) Mega Global Services, Inc. ("MMGS"), a Texas corporation with a principal place of business in Houston; (2) Mega Global Services, Inc. — Singapore ("MMGS-S"), a business entity organized under the laws of Singapore with a principal places of business in that country; and (3) Mega Vista Solutions (S) Pte. Ltd. ("MVS"), a business entity organized under the laws of Singapore with a principal place of business in that country. In addition, Union Carbide formed the defendant, Union Carbide Asia Pacific, Inc. ("UCAP") and the defendant, Union Carbide Customer Services Pte Ltd ("UCCS") to assist product sales in India. UCAP is a corporation organized under the laws of Delaware with a principal place of business in Singapore. UCCS is a corporation organized under the laws of Singapore with a principal place of business in that country.
In or around August 1999, Union Carbide announced a plan of merger with the co-defendant herein, Dow Chemical Company ("Dow"). Dow is a corporation organized under the laws of Delaware, with a principal place of business in Midland, Michigan. The amended complaint alleges that with the plan of merger, the need dropped for the re-sale services in India previously performed by MVMS, MVS, MMGS and MMGS-S. Consequently, the amended complaint alleges that Union Carbide and its affiliates ceased acting consistently with their alleged contractual and legal obligations and, in particular, undertook efforts to establish Dow, untainted by the Bhopal tragedy, in place of the plaintiffs as a direct seller of products to end-users in India.
On February 6, 2001, Union Carbide merged with a subsidiary of Dow and became a wholly owned subsidiary of Dow. At around this time, Dow also created the defendant, Dow Singapore. Dow Singapore is a wholly owned subsidiary of Dow and is incorporated in Singapore with a principal place of business in that country. Dow created Dow Singapore to effectuate sales of Union Carbide products to the plaintiffs and to further Union Carbide and Dow's relationship with the plaintiffs. On January 16, 2002, Dow Singapore advised MVS that, effective March 31, 2002, MVS would no longer be a distributor for Union Carbide products other than wire and cable compounds. MVS refused to continue the relationship with Dow Singapore on those terms.
On June 25, 2003, the plaintiffs MVMS (India), MVS (Singapore), MMGS (Texas) and MMGS-S (Singapore) commenced this lawsuit against the defendants, Union Carbide Corporation (Connecticut), Dow Chemical Company (Michigan), Union Carbide Asia Pacific, Inc. ("UCAP") (Singapore), Union Carbide Customer Service Pte. Ltd. ("UCCS") (Singapore), and Dow Chemical Pacific Private Ltd. (Singapore). The amended complaint alleges that, from 1993 through March 2002, Union Carbide and Dow, directly and through the above named affiliates, compelled the plaintiffs to agree to engage in a price maintenance conspiracy with respect to the resale of Union Carbide products in India, and refused to accept orders or cancelled accepted orders if the prospective resale prices to end-users in India were below certain levels. According to the amended complaint, Dow and Union Carbide sought to "ensure that prices charged by [the][p]laintiffs to end-users in India for [p]roducts would not cause erosion to prices for the [p]roducts charged by [Union Carbide] and Dow to end-users ... in the United States as well as in other jurisdictions..," and that,
[a]s a direct and proximate result of [the][d]efendants fixing of minimum resale prices and other terms of sale, competition in the sale and resale of [Union Carbide] products in and from the United States was improperly diminished and restrained ...
Further, the amended complaint alleges that, among other things, starting in mid-1999 and continuing until 2002, Union Carbide, acting through the defendants, UCAP and UCCS, refused to authorize orders placed by the plaintiffs for Union Carbide products and arbitrarily declined to fill orders that had been placed and accepted, knowing that such actions would "severely damage[ ][the] plaintiffs' relationships with long term strategic customers."
On May 30, 2003, the defendants, UCAP, UCCS, and Dow Singapore filed a motion to dismiss this action as to them only for lack of personal jurisdiction. On November 17, 2003, the court granted the motion as to UCCS and Dow Singapore and denied the motion as to UCAP. On December 4, 2003, the plaintiffs moved for reconsideration of that order, arguing that the record was undeveloped and that the plaintiffs should be allowed to obtain, through discovery, evidence of UCCS's and Dow Singapore's contacts with Connecticut. On July 8, 2004, the court granted the plaintiffs' motion for reconsideration.
On July 8, 2004, the court authorized the plaintiffs to conduct additional personal jurisdiction discovery. On April 6, 2005,2 the plaintiffs moved to vacate the order dismissing Dow Singapore and UCCS for want of personal jurisdiction, arguing that UCCS and Dow Singapore do "transact business" of a "substantial character" in Connecticut, creating jurisdiction under section 12 of the Clayton Act.
Discovery conducted in connection with the instant motion demonstrates that:
A. UCCS
UCCS in Singapore placed purchase orders for Union Carbide products through a centralized computer system located in West Virginia. These orders were transmitted to Union Carbide customer service centers in Houston, Texas or Somerset, New Jersey. When UCCS placed orders for products in bulk, a customer service representative in Texas or New Jersey consulted with both an inventory planner, who was located in Houston, Texas, and a product marketing manager, who was located in Danbury, Connecticut3, to confirm the product was available. For non-bulk orders, a product marketing manager in Connecticut might get involved if contacted by an inventory planner. If Union Carbide handled the shipping and booking for a bulk order, it would go through its booking department in Danbury. Copies of invoices and other transaction-related documents concerning sales to UCCS were sent to Union...
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