Unigestion Holdings v. Upm Tech., Inc.
| Decision Date | 17 March 2020 |
| Docket Number | Case No. 3:15-cv-185-SI |
| Citation | 444 F.Supp.3d 1240 |
| Parties | UNIGESTION HOLDINGS, S.A., a foreign corporation, d/b/a Digicel Haiti, Plaintiff, v. UPM TECHNOLOGY, INC. d/b/a UPM Telecom, Inc., and UPM Marketing, Inc., an Oregon corporation; UPM Telecom, Inc., an Oregon a/b/n; UPM Marketing, Inc., an Oregon a/b/n; Ben Sanchez a/k/a Ben Sanchez Murillo, a foreign individual; Baltazar Ruiz, a foreign individual, and Tyler Allen, a foreign individual, Defendants; UPM Technology, Inc., an Oregon corporation; Counterclaim-Plaintiff, v. Unigestion Holdings, S.A., a foreign corporation, d/b/a Digicel Haiti ; and Digicel USA, Inc., a Delaware corporation; Counterclaim-Defendants. |
| Court | U.S. District Court — District of Oregon |
Richard K. Hansen and Anne M. Talcott, Schwabe, Williamson & Wyatt, PC, 1211 SW Fifth Avenue, Suite 1900, Portland, OR 97204; Robert C.L. Vaughan, Cherine Smith Valbrun, and Leah Storie, Kim Vaughan Lerner, Llp, One Financial Plaza, Suite 2001, Fort Lauderdale, FL 33394. Of Attorneys for Plaintiff and Counterclaim Defendants.
Kathryn P. Salyer and Eleanor A. DuBay, Tomasi Salyer Martin, 121 SW Morrison Street, Suite 1850, Portland, OR 97204; Christopher W. Savage, Davis Wright Tremaine, Llp, 1919 Pennsylvania Avenue NW, Suite 800, Washington, DC 20006. Of Attorneys for Defendants and Counterclaim Plaintiff.
Plaintiff Digicel Haiti, Inc. ("Digicel Haiti") provides mobile telecommunications services in Haiti. In its Third Amended Complaint, Digicel Haiti asserts claims of fraud, conversion, and unjust enrichment against UPM Technology, Inc. ("UPM") and several individuals and entities affiliated with UPM (collectively, "Defendants"). ECF 200. In Defendants' Answer, Affirmative Defenses and Counterclaims, UPM asserts six counterclaims against both Digicel Haiti and Digicel USA, Inc. ("Digicel USA"). ECF 202. Digicel USA is an affiliate of Digicel Haiti and operates two international telephone switching stations in the United States. UPM alleges that Digicel Haiti and Digicel USA violated Sections 201, 202, and 214 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, et seq. (the "Act"). UPM also alleges claims of breach of implied-in-fact contract, money had and received, conversion, unjust enrichment, and intentional interference with prospective economic advantage. ECF 202. Digicel USA—and only Digicel USA—has moved to dismiss all counterclaims asserted by UPM. ECF 206. For the reasons that follow, the Court grants Digicel USA's motion to dismiss.
A motion to dismiss for failure to state a claim may be granted only when there is no cognizable legal theory to support the claim or when the complaint lacks sufficient factual allegations to state a facially plausible claim for relief. Shroyer v. New Cingular Wireless Servs., Inc. , 622 F.3d 1035, 1041 (9th Cir. 2010). In evaluating the sufficiency of a complaint's factual allegations, the court must accept as true all well-pleaded material facts alleged in the complaint and construe them in the light most favorable to the non-moving party. Wilson v. Hewlett-Packard Co. , 668 F.3d 1136, 1140 (9th Cir. 2012) ; Daniels-Hall v. Nat'l Educ. Ass'n , 629 F.3d 992, 998 (9th Cir. 2010). To be entitled to a presumption of truth, allegations in a complaint "may not simply recite the elements of a cause of action, but must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively." Starr v. Baca , 652 F.3d 1202, 1216 (9th Cir. 2011). The court must draw all reasonable inferences from the factual allegations in favor of the plaintiff. Newcal Indus. v. Ikon Office Solution , 513 F.3d 1038, 1043 n.2 (9th Cir. 2008). The court need not, however, credit the plaintiff's legal conclusions that are couched as factual allegations. Ashcroft v. Iqbal , 556 U.S. 662, 678-79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).
A complaint must contain sufficient factual allegations to "plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation." Starr , 652 F.3d at 1216. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (citing Bell Atl. Corp. v. Twombly , 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully." Mashiri v. Epsten Grinnell & Howell , 845 F.3d 984, 988 (9th Cir. 2017) (quotation marks omitted).
For purposes of Digicel USA's motion to dismiss UPM's counterclaims, the Court accepts as true all well pleaded facts alleged by UPM in its counterclaims. The Court, however, gives no presumption of truth to Digicel Haiti's allegations in its Third Amended Complaint ("TAC"), unless UPM in its counterclaims expressly endorses or relies upon Digicel Haiti's allegations.
Digicel USA is a wholly-owned subsidiary of Digicel Holdings, Ltd., which also owns Digicel Haiti. ECF 202 ¶¶ 219-20. Digicel USA owns and operates two sets of international telephone switching systems—equipment with the capacity to transmit a call from the United States to an overseas telecommunications network—in Miami, Florida and New York City, New York. Id. ¶ 221. Digicel Haiti is the leading provider of telecommunication services in Haiti, where it solely operates and has an estimated market share of between 75 and 90 percent of local telephone service. Id. ¶ 224. UPM contends that both Digicel USA and Digicel Haiti are common carriers under the Act. Id. ¶ 222.
Digicel Haiti tracks and charges its local customers in Haiti through pre-paid Subscriber Identity Module ("SIM") cards. A SIM card acts as a small circuit board. When the card is placed inside a cellular telephone, the card identifies the device as associated with an individual customer's unique telephone number and account. These SIM cards then allow customers to access Digicel Haiti's cellular network and, in turn, allow Digicel Haiti to charge for communications made from cellular devices containing specific SIM cards.
When a user of a Digicel Haiti SIM card makes a local call within Haiti, that user incurs charges of about $0.09 per minute of wireless service. If a Digicel Haiti customer travels to the United States and uses his or her Digicel Haiti SIM card to make calls back to Haiti, the user of that SIM card generally incurs charges of at least $1.99 for each minute of wireless service used. Digicel Haiti also offers a Roam-Like-You're-Home ("RLYH") pricing plan. For a monthly access fee about $20 to $25, the RLYH plan allows registered Digicel Haiti customers to call back to Haiti while traveling in the United States at rates similar to the local rates in Haiti during the authorized, pre-paid period.
When someone in the United States not registered on a Digicel Haiti RLYH plan originates a call to one of Digicel Haiti's subscribers in Haiti, a "third-party carrier"—typically a United States telecommunications carrier—picks up that telephone call from the United States-based originating caller and transports it to one of the Digicel USA switching gateways. From that switching gateway, Digicel USA picks up the call and transports it to Haiti. Digicel Haiti pays Digicel USA a "small cost-allocation-based compensation" for its switching services. Id. ¶ 222. Digicel Haiti then "terminates" (i.e. , connects) the call on its local network in Haiti. Digicel Haiti charges the third-party carrier at least $0.23 per minute (the minimum termination rate set by the Haitian government) for terminating calls in Haiti. Id. ¶ 307.
UPM is an Oregon corporation that facilitated international calls from the United States to people in Haiti on behalf of third-party carriers, at rates lower than what Digicel Haiti charged. UPM asserts that from April 2014 through November 2014 it essentially resold Digicel Haiti's local and RLYH services within the United States at a discount. UPM's business involved paying full retail price to buy large quantities of Digicel Haiti's SIM cards from authorized dealers and then using those cards in UPM's servers to facilitate calls to Haiti through two distinct platforms: (1) the resale of the RLYH plan; and (2) the resale of Digicel Haiti's local wireless services. Because of Digicel Haiti's efforts to prevent UPM from reselling Digicel Haiti's services, UPM no longer facilitates calls to Haiti through either of these means.
The first and most common way that UPM facilitated calls to Haiti began with UPM buying about 10,000 of Digicel Haiti's SIM cards at full retail price and enrolling the cards in the RLYH plan. ECF 202 ¶¶ 297-99. At no relevant time did Digicel Haiti provide UPM with any terms or conditions restricting the use of these SIM cards. Id. ¶¶ 278-79. UPM would then place the RLYH-enrolled SIM cards into one or more SIM servers owned and maintained by UPM. These UPM servers were capable of accessing the wireless networks of AT&T and T-Mobile, the third-party carriers that have contractual roaming arrangements in the United States with Digicel Haiti. Ordinarily, when a third-party carrier's customer would call Haiti, the third-party carrier, and ultimately the customer, would be required to pay the standard amount—a minimum of $0.23 per minute—for Digicel Haiti to connect the international call to its local network in Haiti.
UPM offered to the third-party carriers a less expensive way to connect the calls. A third-party carrier that elected to use UPM's services would switch a call bound for a Digicel Haiti customer in Haiti to UPM, instead of to Digicel USA's gateway....
To continue reading
Request your trial