Vibo Corp., Inc. v. Conway, No. 08-571-C.
| Court | United States District Courts. 6th Circuit. United States District Court of Western District of Kentucky |
| Writing for the Court | Jennifer B. Coffman |
| Citation | 594 F.Supp.2d 758 |
| Parties | VIBO CORPORATION, INC., Plaintiff, v. Jack CONWAY, et al., Defendants. |
| Docket Number | No. 08-571-C. |
| Decision Date | 05 January 2009 |
v.
Jack CONWAY, et al., Defendants.
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Brigid O. Gies, Christie A. Moore, Helen A. Thompson, John K. Bush, Greenebaum
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Doll & McDonald PLLC, Louisville, KY, J. Ronald Denman, Mayodan, NC, for Plaintiff.
Tad Thomas, James M. Herrick, Michael Plumley, Kentucky Attorney General, Civil & Environmental Law Div., Frankfort, KY, Gary D. Wilson, Washington, DC, James M. Steinwinder, Alabama Attorney General Office, Montgomery, AL, Chris Poag, Alaska Attorney General Office, Juneau, AK, Ann Uglietta, Kelly M. Peloquin, Arizona Attorney General Office, Phoenix, AZ, Eric B. Estes, Arkansas Attorney General Office, Little Rock, AR, Michelle Hickerson, California Attorney General Office, San Diego, CA, Brian L. Laughlin, Colorado Attorney General Office, Denver, CO, Rupal Shah Palanki, Connecticut Attorney General Office, Hartford, CT, Thomas E. Brown, Delaware Attorney General Office, Wilmington, DE, Sidney R. Barrett, Georgia Department of Law, Atlanta, GA, Alex R. Barrett, Hawaii Attorney General Office, Honolulu, HI, Brett T. Delange, Idaho Office of the Attorney General, Boise, ID, Marilyn A. Kueper, Illinois Attorney General Office, Springfield, IL, Lawrence J. Carcare, II, Indiana Attorney General, Indianapolis, IN, Kristie R. Orme, McDowell Rice Smith & Buchanan, PC, Kansas City, MO, Patrick Y. Broxterman, Kansas Attorney General Office, Topeka, KS, Patricia H. Wilton, Louisana Attorney General Office, Baton Rouge, LA, Jennifer A. Willis, Maine Attorney General Office, Augusta, ME, David S. Lapp, Maryland Attorney General Office, Baltimore, MD, Elizabeth J. Koenig, Massachusetts Attorney General Office, Boston, MA, Brian D. Delvin, Office of the Attorney General for the State of Michigan, Lansing, MI, Curtis R. Stokes, Missouri Attorney General, Jefferson City, MO, Mark M. McLaverty, Montana Attorney General Office, Helena, MT, Richard W. Head, New Hampshire Attorney General Office, Concord, NH, Lynne R. Fritz, Nebraska Attorney General Office, Lincoln, NE, Victoria T. Oldenburg, Nevada Attorney General Office, Reno, NV, David A. Rienzo, New Hampshire Attorney General Office, Concord, NH, Carol G. Jacobson, New Jersey Attorney General Office, Newark, NJ, David K. Thomson, New Mexico Attorney General Office, Santa Fe, NM, Christine E. Morrison, Dana H. Biberman, New York Attorney General Office, New York, NY, Melissa Lou Trippe, Richard L. Harrison, North Carolina Dept. of Justice, Raleigh, NC, Douglas A. Bahr, North Dakota Attorney General Office, Bismarck, ND, Susan C. Walker, Ohio Attorney General Office, Columbus, OH, E. Clyde Kirk, Oklahoma Attorney General, Oklahoma City, OK, Lisa M. Udland, Oregon Department of Justice, Salem, OR, Joel M. Ressler, Pennsylvania Attorney General Office, Harrisburg, PA, Maureen G. Glynn, Rhode Island Attorney General Office, Providence, RI, Jonathan B. Williams, Thomas P. Hunter, South Carolina Attorney General Office, Columbia, SC, Patricia J. Archer, South Dakota Attorney General Office, Pierre, SD, John H. Sinclair, Jr., Rebekah A. Baker, Stephen R. Butler, Tennessee Attorney General, Nashville, TN, Katherine H. Kinsman, Utah Attorney General Office, Salt Lake City, UT, Christy T. Mihaly, Vermont Attorney General Office, Montpelier, VT, William E. Thro, Christopher Newport University, Newport News, VA, Robert J. Fallis, Washington Attorney General Office, Seattle, WA, John S. Dalporto, West Virginia Attorney General Office, Charleston, WV, Christopher J. Blythe, Wisconsin Attorney General Office, Madison, WI, Douglas J. Moench, Kenneth Miller, Wyoming Attorney General Office, Cheyenne, WY, Brian R. Caldwell, District of Columbia, Attorney General Office, Douglas L. Wald, Michael
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B. Bernstein, Arnold & Porter LLP, Elizabeth B. McCallum, Robert J. Brookhiser, Howrey, LLP, Washington, DC, Elliot M. Davis, Virgin Islands Attorney General Office, St. Thomas, VI, Charles S. Cassis, Frost Brown Todd LLC, Louisville, KY, Eric Shapland, Arnold & Porter LLP, Los Angeles, CA, Theresa A. Canaday, Charles S. Cassis, Frost Brown Todd LLC, Merrill S. Schell, Wyatt, Tarrant & Combs LLP, Louisville, KY, Barack S. Echols, Douglas G. Smith, Elli Leibenstein, Stephen R. Patton, Kirkland & Ellis LLP, Chicago, IL, for Defendants.
JENNIFER B. COFFMAN, District Judge.
This matter is before the court upon motions to dismiss filed by the various defendants and one motion to quash service.1 These motions are: (1) motion to dismiss complaint filed by defendants Lorillard Tobacco Co., Philip Morris, Inc., and R.J. Reynolds Tobacco Co. (DE 154); (2) motion to dismiss filed by defendants Commonwealth Brands, Inc., Imperial Tobacco Limited/ITL, Japan Tobacco International USA, Inc., King Maker Marketing, Lane Limited, Liggett Group, LLC, Lignum-2, Inc., P.T. Djarum, Premier Manufacturing Inc., Santa Fe Natural Tobacco Co., Sherman's 1400 Broadway N.Y.C., Inc., Top Tobacco, LP, and Vector Tobacco, Inc. (DE 156); (3) motion to dismiss for lack of subject-matter jurisdiction and failure to state a claim by defendant Jack Conway, Attorney General of Kentucky (DE 149); (4) motion to dismiss for lack of personal jurisdiction and improper venue and contingent joinder in defendant Conway's motion to dismiss by the Attorneys General of the remaining forty-five states, five territories, and the District of Columbia (DE 208); (5) motion to dismiss for improper service of process by defendant Peter Nickles (DE 210); and (6) motion to quash purported service on defendant Jeremiah W. Nixon (DE 215).
I. Background2
In the mid-1990s a number of states sued the four largest tobacco manufacturers in the United States.3 The states' claims "centered on allegations that the manufacturers targeted youth in their advertising; knew of, controlled, and failed to disclose research into harmful effects of cigarette smoke; and knew nicotine in cigarettes was addictive and marketed their cigarettes with those addictive properties in mind." Am. Compl. ¶ 105. In 1998, the parties resolved the litigation and signed the Master Settlement Agreement ("MSA").
The MSA originally was negotiated by eight states' Attorneys General and then was released to other states so that they might decide whether they wished to join
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it. Id. ¶¶ 109, 110. Additional states took action to enjoy the benefits of the MSA, and a total of fifty-two states and territories, through their Attorneys General, eventually signed on to the MSA. These states are collectively known as the "Settling States."4 Kentucky, like other Settling States without a case already pending against the tobacco manufacturers, instigated litigation and then settled it by asking a state court to enter an agreed order approving the MSA and dismissing with prejudice the state's claims. Id. ¶ 119. According to the terms of the MSA, in return for a tobacco manufacturer's agreement to the terms of the MSA, which included making substantial payments to the Settling States, a state agreed to release the company from all claims arising out of certain past and future conduct relating to its tobacco manufacturing business. See MSA § II(nn) (defining "released claims" and listing all types of conduct for which a manufacturer was released from liability).5 Those manufacturers agreeing to the MSA are known as "Participating Manufacturers" ("PMs"). The four tobacco companies that were sued in the initial lawsuits and with which the states reached the initial settlement are known as the Original Participating Manufacturers ("OPMs"). Those that joined the MSA later are known as Subsequent Participating Manufacturers ("SPMs").
The OPMs feared that by signing the MSA, and thus incurring significant costs that would require an accompanying price increase of their products, they would be creating a significant market opportunity for tobacco manufacturers that did not sign the MSA. Am. Compl. ¶ 127. That is, the OPMs anticipated that those companies who did not sign (known as Non-Participating Manufacturers, or "NPMs") and thus had no payment obligations would be able to price their products below the OPMs' market price, thereby taking sales away from the OPMs. Id. In order to address these concerns and encourage participation in the MSA by tobacco companies other than the OPMs, the Settling States agreed to several provisions of the MSA. Id. It is these aspects of the MSA that give rise to the instant plaintiff's claims.
First, the Settling States agreed to release claims not only against the PMs but also against tobacco retailers, suppliers, and distributors to the extent of their dealings in the PMs' products. See MSA § II(oo) (defining "released parties" to include suppliers, retailers, and distributors of the PMs' products). This provision encouraged sellers of tobacco products to carry only products made by PMs. See Am. Compl. ¶ 128.
Second, to ensure that those companies not participating in the MSA have financial obligations to the states similar to those of the companies that are participating, the MSA includes a mechanism designed to equalize the potential profits of PMs and NPMs. The MSA provides that the states may enact "Escrow Statutes" or "Qualifying Statutes." See MSA § IX(d)(2). In general terms, the Escrow Statute of a state obligates the tobacco companies that do not sign the MSA (NPMs) to make
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annual deposits into an escrow account, based on their sales volume in the state. See id. The principal amounts are held in escrow for twenty-five succeeding years and, if there is no judgment against or settlement with a particular NPM...
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...quarterly deposit requirements pursuant to its MSA Adherence Agreement.” 10. Verified Amended Complaint at 53, Vibo Corp. v. Conway, 594 F.Supp.2d 758 (W.D.Ky.2009), aff'd, 669 F.3d 675 (6th Cir.2012). 11. Because respondent's determinations have been sustained, pursuant to the amendment to......
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Providence Title Co. v. Truly Title, Inc., Civil No. 4:21-CV-147-SDJ
...the Covenants Not to Compete Act that the public is not disserved by enforcement of reasonable noncompete agreements. Transperfect , 594 F.Supp.2d at 758. Tracie Fleming knew when she agreed to become a Providence shareholder that she would be subject to a noncompete provision when she ceas......
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Providence Title Co. v. Truly Title, Inc., CIVIL NO. 4:21-CV-147-SDJ
...the Covenants Not to Compete Act that the public is not disserved by enforcement of reasonable noncompete agreements. Transperfect, 594 F.Supp.2d at 758. Tracie Fleming knew when she agreed to become a Providence shareholder that she would be subject to a noncompete provision when she cease......
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Suriel v. Comm'r, No. 367–12.
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