Olin Corp. v. Fisons Plc

• Decision Date: 28 April 1999
• Docket Number: Civil Action No. 93-11166-WGY.
• Citation: 47 F.Supp.2d 151
• Parties: OLIN CORPORATION, Plaintiff, v. FISONS PLC, Nor-Am Chemical Corp., American Biltrite, Inc., And the Biltrite Corporation, Defendants.
• Court: U.S. District Court — District of Massachusetts

47 F.Supp.2d 151

OLIN CORPORATION, Plaintiff, v. FISONS PLC, Nor-Am Chemical Corp., American Biltrite, Inc., And the Biltrite Corporation, Defendants.

Civil Action No. 93-11166-WGY.

United States District Court, D. Massachusetts.

April 28, 1999.

Robert S. Sanoff, Jonathan M. Ettinger, Foley, Hoag & Eliot, Boston, MA, Charles Swinburn, Morgan, Lewis & Bockius, Washington, DC, Ralph N. Albright, Jr., Morgan, Lewis & Bockius, Washington, DC, Jay H. Calvert, Howard T Weir, Kenneth A. Rubin, Morgan, Lewis & Bockius, for Olin Corporation, plaintiff.

Charles A. Gilman, Patrick L. Rocco, Robert M. Hallman, Cahill, Gordon & Reindel, New York City, Donald R. Frederico, McDermott, Will & Emory, Boston, MA, for Fisons PLC, defendant.

Kenneth J. Warren, Kermit L. Rader, Marc L. Frohman, Manko, Gold & Katcher, Bala Cynwyd, PA, John C. Wyman, Roche, Carens & DeGiacomo, P.C., Boston, MA, for Nor-Am Chemical Corp, Noram Chemical Company, defendant.

Roscoe Trimmier, Robert G. Jones, Peter Fratangelo, Ropes & Gray, Boston, MA, J. Daniel Berry, Ropes & Gray, Washington, DC, for American Biltrite, Inc.

Timothy J. Hinkle, Robert G. Jones, Peter Fratangelo, Ropes & Gray, Boston, MA, J. Daniel Berry, Ropes & Gray, Washington, DC, for The Biltrite Corporation.

John C. Wyman, Roche, Carens & DeGiacomo, P.C., Boston, MA, for Nor-Am Chemical Corp.

David S. Weiss, Leonard H. Freeman, Goulston & Storrs, Boston, MA, for The Stepan Co.

Susan M. Insoft, McDermott, Will & Emory, Boston, MA, Donald R. Frederico, McDermott, Will & Emory, Boston, MA, for Fisons Finance Ltd.

MEMORANDUM AND ORDER

YOUNG, Chief Judge.

I. Introduction

Olin Corporation ("Olin") is the current owner of a contaminated former chemical manufacturing plant in Wilmington, Massachusetts ("the Wilmington Site"). In 1993, Olin filed this action against Fisons PLC ("Fisons"), NOR-AM Chemical Corporation ("NOR-AM"), American Biltrite, Inc., and the Biltrite Corporation (together, "Biltrite") for (1) contribution pursuant to sections 107(a) and 113(f) of the Comprehensive Environmental Response Compensation Liability Act ("CERCLA"), 42 U.S.C. § 9613(f); (2) injunctive relief pursuant to section 7002(a)(1)(B) of the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6972(a)(1)(B); and (3) remedies under the Massachusetts Oil and Hazardous Material Release Prevention Act, Mass.Gen.L. ch. 21E ("Chapter 21E"). Biltrite and NOR-AM subsequently filed cross-claims against Fisons for contribution under CERCLA and state law. NOR-AM also filed a cross-claim against Fisons for indemnification.

On December 15, 1998, Olin and Fisons executed a Confidential Settlement Agreement and Mutual Release (the "Settlement Agreement") and have since dismissed all claims and counterclaims against each other. Olin and Fisons then jointly moved to dismiss NOR-AM's and Biltrite's cross-claims against Fisons. This Court dismissed the cross-claims for contribution under CERCLA and state law on April 7, 1999. The Court now addresses Fisons' motion to dismiss NOR-AM's cross-claim for indemnification.

II. Background

The Wilmington Site is a fifty-acre tract located at 51 Eames Street in Wilmington, Massachusetts. Between 1953 and 1986, various owners of the Wilmington Site—including Fisons, Biltrite, and NOR-AM—operated a chemical factory and dumped waste byproducts on the premises. In January 1987, the Massachusetts Department of Environmental Quality Engineering designated the Wilmington Site a Confirmed Disposal Site. Olin has since implemented response actions pursuant to Chapter 21E and the Massachusetts Contingency Plan, 310 C.M.R. § 40.00 et seq.

The indemnification claim arises out of a 1983 stock sale agreement between Fisons and several foreign companies not before this Court. In July of 1983, Fisons and the Boots Company, another British corporation, sold shares of FBC Holdings Limited ("FBC"), also a British entity, to Schering Aktiengesellschaft ("Schering"), a German corporation. At the time of the acquisition, FBC held several enterprises, including Fisons Corporation, the entity now known as NOR-AM. As part of the sales contract, Fisons agreed to indemnify Schering for the potential liabilities of NOR-AM and other Fisons subsidiaries for actions occurring before the 1983 sale. See Fisons Mem., Ex. D. at § 5.1 and Fourth Sched. at § 32. The sales contract specifically provides that Schering can assign to any of its subsidiaries the right to seek indemnification directly from Fisons for claims made against that subsidiary. See id. at § 17.2. Schering has assigned to NOR-AM the right to seek indemnification from Fisons. See NOR-AM Mem., Ex. B.

Fisons now moves to dismiss the cross-claim for indemnification on grounds of lack of personal jurisdiction¹ and forum non conveniens.

III. Discussion

A. Personal Jurisdiction

NOR-AM argues that Fisons is subject to personal jurisdiction in Massachusetts with respect to the cross-claim for three reasons. First, NOR-AM contends that Fisons consented to personal jurisdiction in this Court when it filed an answer on October 30, 1998 asserting cross-claims against NOR-AM and Biltrite. Second, NOR-AM relies on the doctrine of "pendent personal jurisdiction." Finally, NOR-AM asserts that Fisons is subject to personal jurisdiction on the cross-claim under the traditional long-arm and due process analyses.

1. Consent to Personal Jurisdiction

"A defendant may manifest consent to a court's in personam jurisdiction in any number of ways, from failure seasonably to interpose a jurisdictional defense ... to submission implied from conduct." General Contracting & Trading Co., L.L.C v. Interpole, Inc., 940 F.2d 20, 22 (1st Cir. 1991). NOR-AM argues that Fisons consented to personal jurisdiction in this Court when it brought cross-claims against NOR-AM and Biltrite. This Court rejects NOR-AM's argument.

In Interpole, on which NOR-AM relies, the plaintiff sued Interpole for breach of a sale of goods. See id. at 21. Interpole then filed a third party complaint against Trastco, the transporter of the goods. See id. Trastco failed to respond to the suit and the court entered default judgment against it. See id. After unsuccessfully attempting to lift the default, Trastco brought a separate action in the same federal district court against Interpole for fraud and misrepresentation in connection with the same transaction. See id. Trastco then argued before the First Circuit that the default judgment entered against it in the first action was unenforceable for lack of personal jurisdiction. See id. at 22. The First Circuit held that Trastco had submitted to the court's jurisdiction by initiating its own suit against Interpole in the same court. See id. at 25. Interpole is inapposite to the instant case because Fisons, unlike Trastco, has not filed a separate action against NOR-AM in the same jurisdiction. Here, Fisons asserted the defense of lack of personal jurisdiction and, in the same responsive pleading, asserted cross-claims against NOR-AM and Biltrite. The First Circuit has not considered whether a defendant who asserts a personal jurisdiction objection nevertheless waives that objection by also filing a cross-claim in the same responsive pleading.²

In Lomanco, Inc. v. Missouri Pacific Railroad Company, 566 F.Supp. 846, 849 (E.D.Ark.1983), the plaintiff and the railroad defendant argued that the other two defendants had waived their defense of lack of personal jurisdiction when they filed cross-claims for indemnification against the railroad. The court rejected the argument, reasoning that Rule 12(b) of the Federal Rules of Civil Procedure implicitly allows a defendant to assert both a 12(b)(2) defense and a cross-claim in its answer.³ See id. at 850 (citing Neifeld v. Steinberg, 438 F.2d 423 [3d Cir.1971]). If simultaneous assertion of the personal jurisdiction defense and a cross-claim could waive the defense a defendant would be forced to assert the personal jurisdiction defense by motion. See Neifeld, 438 F.2d at 428. Such a result would controvert the choice between motion and answer that Fed.R.Civ.P. 12(b) explicitly provides. See id.

Based on this reasoning, "the majority [of cases] now holds the filing of a cross-claim or third-party claim in the same pleading in which the defendant asserts a defense of lack of personal jurisdiction does not waive the jurisdictional defense." Proctor & Gamble Cellulose Co. v. Viskoza-Loznica, 33 F.Supp.2d 644, 645-46 (W.D.Tenn.1998) (citing cases). Fisons asserted its objection to this Court's exercise of personal jurisdiction over it in the same pleading in which it asserted cross-claims against NOR-AM and Biltrite. Accordingly, this Court concludes that Fisons did not submit to personal jurisdiction in Massachusetts by filing cross-claims. See, e.g., Lomanco, 566 F.Supp. at 851.

2. Pendent Personal Jurisdiction

NOR-AM also argues that jurisdiction over Fisons is proper under the doctrine of pendent personal jurisdiction. According to that doctrine, a court having personal jurisdiction over a defendant as to one count of a multi-count complaint also has personal jurisdiction over the defendant with respect to the other counts. See Home Owners Funding Corp. of America v. Century Bank, 695 F.Supp. 1343, 1345 (D.Mass.1988). The current motion, however, does not involve multiple counts of a complaint. Rather, the issue is whether the Court has personal jurisdiction over Fisons with respect to NOR-AM's cross-claim given that Judge Wolf predicated personal jurisdiction over Fisons on Olin's claims against Fisons, which Olin has since dismissed. This Court declines to extend the judge-made doctrine of pendent personal jurisdiction to the current situation.

As this Court has explained, the doctrine of pendent personal jurisdiction has its roots in the jurisprudence of pendent subject matter jurisdiction, see Val Leasing, Inc. v. Hutson, 674 F.Supp. 53, 56 (D.Mass.1987), and in fact "there is a...