Rsm Production Corp. v. Fridman
| Decision Date | 19 February 2009 |
| Docket Number | Court No. 06-cv-11512. |
| Citation | 643 F.Supp.2d 382 |
| Parties | RSM PRODUCTION CORPORATION, Jack J. Grynberg, and Grynberg Petroleum Company, Plaintiffs, v. Mikhail FRIDMAN, Len Blavatnik, Lev Korchagin, Gregory Bowen, Lev Model, Global Petroleum Group, Ltd., TNK-BP Limited, Lord John Browne, BP, p.l.c., and John Does 1-5, Defendants. |
| Court | U.S. District Court — Southern District of New York |
Law Office of Daniel L. Abrams, PLLC (Daniel L. Abrams), for Plaintiffs RSM Production Corporation, Jack J. Grynberg, and Grynberg Petroleum Company.
Curtis, Mallet-Prevost, Colt & Mosle (Turner P. Smith and Myles Bartley), for Defendant Leonard Blavatnik.
Paul, Weiss, Rifkind, Wharton & Garrison, LLP (Jeh Charles Johnson), for Defendant Gregory Bowen.
Sullivan & Cromwell LLP (Daryl A. Libow and Bruce W. Hickey), for Defendants BP, p.l.c. and John Browne.
Akin, Gump, Strauss, Hauer & Feld, LLP (Robert H. Pees, W. Randolph Teslik, and John L. Van Sickle), for Defendant Mikhail Fridman.
White & Case LLP (Owen C. Pell, Timothy Pfeifer, and Robert M. Kelly), for Defendant TNK-BP Limited.
This case arises out of an alleged oil and natural gas exploration contract between Plaintiffs and the Government of Grenada. Under the alleged contract, Plaintiffs were to receive a license to conduct seismic exploration off the coast of Grenada. That license was never issued. Plaintiffs assert claims for tortious interference with contract, tortious interference with prospective business advantages, and civil conspiracy to commit tortious interference.
Various motions are before the court. These include: motions for dismissal on the threshold grounds of lack of subject matter jurisdiction under the Foreign Sovereign Immunities Act and lack of personal jurisdiction; a motion to strike certain allegations and exhibits from the Third Amended Complaint; and motions for dismissal on the merits, principally on the ground that Plaintiffs have failed to state a claim upon which relief can be granted. Plaintiffs have applied for default judgment with respect to the two non-appearing Defendants.
For the reasons set forth below, the motion to strike is granted in part and denied in part, Defendants' motions for dismissal are granted, and Plaintiffs' applications are denied.
Plaintiff RSM Production Corporation ("RSM") is a corporation incorporated in Texas, with its business address in Colorado. (Third Amended Complaint ¶ 1.) Plaintiff Jack J. Grynberg ("Grynberg"), an oil and natural gas professional, is a resident and citizen of Colorado. (Id.) Plaintiff Grynberg Petroleum Company is a sole proprietorship (d/b/a) owned by the wife of Jack J. Grynberg; she is not represented in this action.2
Defendant Gregory Bowen ("Bowen") was, at all relevant times, Deputy Prime Minister of the Government of Grenada, as well as Grenada's Minister of Energy.3 (Id. ¶ 5.)
Defendant BP, p.l.c. ("BP") is an oil and energy company organized under the laws of the United Kingdom. (Id. ¶ 10.) BP does business in the United States as BP Corporation North America Inc., and maintains an investor relations office in New York. (Id.)
Defendant John Browne ("Browne") is a British resident and national. (Id. ¶ 9.) Until May 1, 2007, Browne was Group Chief Executive of BP. (Id.)
Defendant TNK-BP Limited ("TNK-BP") is a company organized in 2003 under the laws of the British Virgin Islands. (Id. ¶ 8.) TNK-BP is jointly owned by BP (50%), the Alfa Group (25%), and Access Industries together with a large Russian conglomerate (25%). (Id.)
Defendant Mikhail Fridman ("Fridman") is Chairman of the Board of Directors of TNK-BP. (Id. ¶ 2.) Fridman is also Chairman of the Board of Directors of the Alfa Group Consortium and Chairman of the Board of Directors of Alfa-Bank, which has offices in New York. (Id.)
Defendant Len Blavatnik ("Blavatnik") is a member of the Board of Directors of TNK-BP. (Id. ¶ 3.) Blavatnik is believed to maintain a residence and to conduct business affairs in New York through his company, Access Industries. (Id.)
Defendant Global Petroleum Group, Ltd. ("Global Petroleum") is a company founded under the laws of Grenada in 2003. (Id. ¶ 7.) Global Petroleum was founded by a group of individuals, including Defendant Lev Model and Lev Korchagin ("Korchagin").4 (Id.)
Defendant Lev Model ("Model") is a Director of Global Petroleum, and he is believed to be its Chairman. (Id. ¶ 6.) Model is a resident of Brooklyn, New York. (Id.)
According to the Third Amended Complaint,5 RSM and the Government of Grenada entered into an exclusive Petroleum Agreement ("Agreement") in July 1996. (Third Amended Complaint ¶ 12.) Pursuant to this Agreement, Grenada was to issue a license to RSM for "oil and natural gas exploration, development, and production." (Id.) RSM was required to apply for such a license within 90 days after execution of the Agreement, i.e., by October 1996. Instead, in a letter dated July 18, 1996, RSM provided notice to the Government of Grenada that it was invoking the force majeure clause contained in the Agreement. (Id. ¶ 29.) This letter was accepted and agreed to by Grenada. (Id.)
In September 1996, Bowen advised Grynberg that in order for RSM and Grynberg to conduct business in Grenada, they would have to furnish significant bribe payments to Bowen. (Id. ¶ 15.) After RSM and Grynberg refused to do so, "Bowen obstructed, harassed and intimidated RSM and Grynberg in their efforts to explore, develop and produce Grenada's oil and gas natural resources." (Id.)
In late January 1999, Grynberg made a presentation to the General Counsel of the British Petroleum Exploration Company ("BPX"), a wholly-owned exploration, development and production subsidiary of BP; at the time of Grynberg's presentation, Browne was the Chief Executive Officer of BPX. (Id. ¶ 14.) The purpose of the presentation was to invite BPX to join RSM in its exploration, development and production project in offshore Grenada. (Id.) Grynberg provided the General Counsel of BPX with "extremely valuable confidential, exclusive, geologic, geophysical and economic information of the vast oil and natural gas potential of offshore Grenada," with the understanding that he would take this information to London and share it with Browne; the General Counsel later stated that he did share this information with Browne. (Id.)
In August 2003, TNK-BP was formed. (Id. ¶¶ 17, 28.) Following the formation of TNK-BP, the Global Petroleum Group was formed in December 2003. (Id. ¶ 25.) Within months after the formation of the Global Petroleum Group, "Grenada took active steps to get out of its exclusive contract with RSM." (Id. ¶ 29.)
On January 12, 2004, RSM wrote to the Prime Minister of Grenada to inform him that RSM was in the process of revoking the force majeure. (Id. ¶ 31.) On April 14, 2004, RSM submitted an application for an "oil and natural gas exploration license" to Grenada. (Id. ¶ 32.) After an exchange of letters between Grynberg and various Ministers within the Government of Grenada (see id. ¶¶ 32-33), Bowen advised RSM of his position that RSM had not timely filed its license application by letter dated April 27, 2004 (id. ¶ 34). RSM then filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes ("ICSID") on August 31, 2004, alleging that Grenada breached its contract with RSM.6 (Id. ¶ 40.)
In 2005 and early 2006, Grynberg was contacted by Michael Melnicke ("Melnicke"), a New York business person who is an "Ambassador-At-Large" for the Government of Grenada, appointed to that position by Grenada's Prime Minister, Keith Mitchell. (Id. ¶ 45.) Melnicke also serves with Blavatnik as a Director of the American Jewish Congress. (Id.) Melnicke offered to assist in resolving the dispute between RSM and Grenada. (Id. ¶ 49.) As compensation for his offered assistance, Melnicke asked for certain royalties based on the amount of oil and natural gas produced pursuant to the Agreement between RSM and Grenada. (Id.) Between 2005 and early 2006, Melnicke proffered several versions of a proposed contract memorializing those terms, but RSM refused to sign any of the drafts. (Id.) During the course of these negotiations, Melnicke "revealed" to Grynberg that Blavatnik and Fridman had bribed Bowen so that their group could develop the petroleum reserves believed to exist off the shore of Grenada. (Id. ¶ 50.) Melnicke "further revealed" that Blavatnik and Fridman had also promised to furnish bribes to Grenadian government officials in the future, and had also promised to finance Grenada's legal defense in the ICSID arbitration. (Id.)
In June and July of 2007, certain official documentation was made public by the Government of Grenada; these documents showed that Global Petroleum had invested more than $4 million into Grenada's legal defense before the ICSID tribunal. (Id. ¶ 53.) On June 21, 2007, Bowen testified in the ICSID arbitration that Global Petroleum "is affiliated with a company that is `one of the biggest . . . seismic scientific investment compan[ies] and that they did work in the U.S. and the UK and China.'" (Id. ¶ 52.)
Plaintiffs' original Complaint, filed on November 1, 2006, stated causes of action for tortious interference with contract and tortious interference with prospective business advantages against Bowen, Fridman, Blavatnik, and Korchagin. Since the filing of the original Complaint, Plaintiffs have amended...
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