Proshipline Inc. v. Aspen Infrastructures Ltd.
| Decision Date | 01 February 2008 |
| Docket Number | No. 07 Civ. 10969.,07 Civ. 10969. |
| Citation | 533 F.Supp.2d 422 |
| Parties | PROSHIPLINE INC., Plaintiff, v. ASPEN INFRASTRUCTURES LTD., f/k/a/ Suzlon Infrastructure Ltd., Defendant. |
| Court | U.S. District Court — Southern District of New York |
Hill, Rivkins and Hayden by John James Sullivan, Esq., Christopher Michael Panagos, Esq., New York City, for Plaintiff
Deorchis & Partners, LLP by John A. Oriel, Esq., New York City, for Defendants.
Defendant Aspen Infrastructures Ltd. ("Aspen" or the "Defendant") has moved pursuant to Supplemental Admiralty Rule E(4)(f) of the Federal Rule of Civil Procedure to vacate the Order and Process of Maritime Attachment and Garnishment issued at the request of plaintiff ProShipLine Inc. ("ProShipLine" or the "Plaintiff').
For the reasons set forth below the motion is granted, and the attachment is vacated,
On August 6, 2007, EP-Team, Inc. ("EP-Team") and ProShipLine jointly filed suit against Aspen in the United States District Court for the Southern District of Texas, EP-Team and ProShipLine v. Aspen Infrastructures, 07 Civ. 2549 (the "First Texas Action"), seeking declaratory relief with respect to the construction and enforcement of the contract between the parties (the "Agreement"), to compel arbitration, and to order the payment of funds to the registry of the Court pending the resolution of the dispute between the parties by arbitration or otherwise.
Aspen appeared in the action and moved for an order staying the litigation pending arbitration of the parties' disputes in Singapore (the "Singapore Arbitration"), as required by the Agreement between the parties. After a hearing on December 5, 2007, the First Texas Action was administratively closed by the Court, with leave granted to the parties to apply to reinstate the matter at the close of the Singapore Arbitration.
Aspen demanded arbitration under the Agreement in Singapore on August 30, 2007. On October 9, 2007, Aspen's Singapore counsel invoked the default appointment procedure of the International Arbitration Act and asked that the Singapore International Arbitration Center appoint an arbitrator on behalf of EP-Team. EP-Team responded to the SIAC on October 11, 2007, and appointed its party arbitrator on October 16, 2007.
On December 10, 2007, the tribunal in the Singapore Arbitration issued a procedural order between Aspen and EP-Team in accordance with which the Statement of Claim was to be served by December 2007, and the Statement of Defense by January 16, 2008.
On December 14, 2007, counsel representing both EP-Team and ProShipLine in the Singapore Arbitration advised the tribunal and Aspen that ProShipLine would not be instituting separate arbitration proceedings against Aspen in Singapore and that ProShipLine would seek to litigate its claims against Aspen in the United States District Court for the Southern District of Texas. ProShipLine counsel advised that EP-Team had assigned to ProShipLine "all rights ... to sue for and recover damages from" Aspen "and/or for breach of any Other obligations owed' by [Aspen] to [EP-Team]."
On December 21, 2007, Aspen submitted its formal "points of claim" in the Singapore Arbitration.
On October 12, 2007, Aspen filed a suit against EP-Team in the United States District Court for the Southern District of New York, Aspen Infrastructures Ltd. v. E.P. Team, Inc., 07 Civ. 8813(RWS) (the "First New York Action"), seeking the issuance of an Order and Process of Maritime Attachment against EP-Team. Aspen filed an amended complaint on October 14, 2007. To date, $37,744.98 has been restrained by garnishee banks. EP-Team has not appeared in the action.
On November 27, 2007, EP-Team, and ProShipLine filed an action in the United States District Court for the Western District of Washington against Aspen, EP-Team and ProShipLine v. Aspen, 07 Civ. 5660(FDB) (the "Washington Action"). The Suit specifically named eight vessels which Aspen hits on charter and which it has been using in its transportation service to the United States as garnishees and asked that the Court issue an Order and Writ of Maritime Attachment and Garnishment. Upon arrival of the m/v Margaretha Green within the jurisdiction of the Court, it was served with the writ, and Aspen posted a "Maritime Release Bond" in the amount of $532,539.00, which represented the value of Aspen's property on board the vessel.
Subsequently, the m/v Beluga Fusion, another vessel being used by Aspen in its transportation service to the United States, called within the jurisdiction of the United States District Court for the Western District of Washington. In response to an emergency motion by Aspen, the Court ordered that EP-Team and ProShipLine remove all of the Aspen property from the vessel by noon on December 30, 2007. EP-Team and ProShipLine are currently holding the property within the jurisdiction of the Western District of Washington. The Value of the removed property was more than $93,000.00. In addition, Aspen posted a bond in the amount of $52,455.24.
On December 3, 2007, ProShipLine filed this action against Aspen, ProShipLine v. Aspen, 07 Civ. 10969(RWS) (the "Second New York Action"), seeking an Order and Writ of Maritime Attachment and Garnishment against Aspen in the amount of $5,75000.00. On Saturday, January 5, 2008, ProShipLine's counsel gave notice that $1,999,964.00 had been restrained by garnishee Citibank.
On December 7, 2007, EP-Team and ProShipLine filed an action in the United States District Court for the Southern District of Texas, EP-Team/ProShipLine v. Aspen, 07 Civ. 4170 (the "Second Texas Action"), seeking an Order and Writ of Maritime Attachment and Garnishment against Aspen and naming the, m/v Beluga Revolution as, a garnishee. By Opinion and Order dated December 18, 2007, the court found that Aspen has a general agent within the jurisdiction and that it was amenable to service of process.
The instant motion to vacate the attachment in the Second New York Action was heard and marked submitted on January 16, 2008.
Aspen is a corporation existing pursuant to the laws of India with its headquarters located in Pune and is an associated company of Suzlon Energy Ltd., which is engaged in the manufacture and marketing of alternative energy production devices, specifically windmills. As part of its business, Aspen engages in the transportation of cargo by ocean-going vessel to move windmill components from factories in India to the market countries, including the United States. In an attempt to avoid the "deadhead" return of empty vessels from the market countries to India, Aspen entered into the contract carriage business, soliciting cargos in the market countries with destinations in Asia.
Aspen entered into a Sales and Logistics Services Agreement dated April 9, 2006, with EP-Team (the "Agreement"), which provided that Aspen would appoint EP-Team as its "General Sales and Port Services Agent of [Aspen] in the USA" and that EP-Team would establish a sales and management operation to secure freight and other associated revenue for vessels controlled by Aspen calling at the United States and to act as the port agent for the Aspen-controlled vessels calling at U.S. ports, arranging terminal facilities, stevedoring services, cargo handling services, and documentation services. The Agreement provided that any dispute under the Agreement was to be resolved by arbitration in Singapore and that the contract was to be construed and enforced in accordance with English law.
EP-Team established ProShipLine to act as agent for Aspen. In its own right and through ProShipLine, EP-Team arranged terminal facilities, issued bills of lading on behalf of Aspen, arranged cargo handling on the vessels and the receipt and delivery of cargo and collected freight due to Aspen, and opened an "impress account" at the Bank of America bearing account number **** **** **** into which funds collected on behalf of Aspen were to be deposited and from which authorized payments were to be made.
Aspen became dissatisfied with EP-Team's performance under the Agreement and with significant financial irregularities in connection with EP-Team's administration of the Aspen impress account.
On July 5, 2007, Aspen notified EP-Team that Aspen proposed to effect the transfer of its controlled vessels to a new deponent owner and that the new owners would be making their own arrangements for a U.S. agent. EP-Team responded that the purported termination was in violation of the Agreement and that EP-Team would hold Aspen responsible for damages under the Agreement.
On July 30, 2007, counsel for EP-Team and ProShipLine stated to Aspen's London counsel that as Aspen had terminated the Agreement as of August 1, 2007, EP-Team and ProShipLine would no longer act on behalf of Aspen in any capacity as of July 30, 2007.
Aspen, EP-Team, and ProShipLine have disputed the treatment of the impress account and the collection of freight by EP-Team and ProShipLine since. July 30, 2007.
When a defendant moves to vacate an attachment pursuant to Supplemental Admiralty Rule E, the plaintiff bears the burden of showing that the filing and service requirements of Supplemental Admiralty Rules B and E were met and that "1) it has a valid prima facie admiralty claim against the defendant; 2) the defendant cannot be found within the district; 3) the defendant's property may be found within the district; and 4) there is no statutory or maritime law bar to the attachment." Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd., 460 F.3d 434, 445 (2d Cir.2006). If the plaintiff fails to demonstrate that it has met the requirements, the Court must vacate the attachment.
Plaintiff, however, is not required to prove its case, it must simply meet a prima facie standard. See Ronda Ship Mgmt. v. Doha Asian. Games Organising Comm., 511 F.Supp.2d 399, 403 (S.D.N.Y. 2007) (...
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