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LINDNER FUND, INC. v. POLLY PECK INT'L PLC

December 21, 1992

LINDNER FUND, INC., et al., Plaintiffs,
v.
POLLY PECK INT'L PLC, et al., Defendants.


KEENAN


The opinion of the court was delivered by: JOHN F. KEENAN

JOHN F. KEENAN, United States District Judge

 INTRODUCTION

 Before the Court is the motion of Defendant Stoy Hayward, a British accounting firm, to dismiss the action for lack of personal jurisdiction, failure to state a claim, failure to plead fraud with particularity, lack of subject matter jurisdiction, and under the doctrine of forum non conveniens. Fed. R. Civ. P. 12(b)(2), (6), 9(b). For the reasons that follow, Defendant's motion to dismiss is granted. *fn1"

 BACKGROUND

 In the third quarter of 1990, Asil Nadir, the then-chairman of Polly Peck International PLC, made an aborted bid to take the company private. Polly Peck, a publicly held conglomerate organized under United Kingdom law and headquartered in London, is a holding company for a network of over 200 subsidiaries worldwide. In the wake of Nadir's failed attempt, investors and bank creditors began to lose confidence in the company, and were unwilling to extend Polly Peck the credit it required to fund its day-to-day activities. Polly Peck's ordinary stock was taken off the London stock exchange in October 1990, and Polly Peck ultimately entered insolvency proceedings that are estimated to be the largest in the history of the United Kingdom: Polly Peck has approximately 2,000 creditors, not including shareholders, whose claims presently amount to approximately $ 2.3 billion. *fn2"

 In the midst of this complex administration, Plaintiffs filed this lawsuit claiming violations of the Securities Exchange Act of 1934, Sections 18 and 27, and negligence. Plaintiffs purchased Polly Peck ordinary stock, or American Depositary Receipts ("ADRs"), *fn3" in the United States between December 21, 1987 and August 21, 1990. Plaintiffs assert that Defendant Stoy Hayward, a British accounting firm, audited Polly Peck's group accounts from 1985 to 1989. *fn4" Polly Peck ultimately incorporated Defendant's group audit report into its annual reports, which were filed with the Securities Exchange Commission. Plaintiffs contend that the annual reports contained false and misleading information, including the group audits, that wrongfully induced them to invest in Polly Peck.

 DISCUSSION

 "At the outset of any forum non conveniens inquiry, the court must determine whether there exists an alternative forum. Ordinarily, this requirement will be satisfied when the defendant is 'amenable to process' in the other jurisdiction." Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254, 70 L. Ed. 2d 419, 102 S. Ct. 252 n.22 (1981) (quoting Gulf Oil v. Gilbert, 330 U.S. 501, 506-07, 91 L. Ed. 1055, 67 S. Ct. 839 (1947)). In Gulf Oil v. Gilbert, the Supreme Court outlined the private and public interests that a district court should weigh in deciding whether to refuse jurisdiction pursuant to the doctrine of forum non conveniens. The private interests to be considered include

 relative ease of access to sources of proof; availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses . . . and all other practical problems that make trial of a case easy, expeditious and inexpensive. There may also be questions as to the enforceability of a judgment if one is obtained.

 Gulf Oil v. Gilbert, 330 U.S. 501, 508, 91 L. Ed. 1055, 67 S. Ct. 839 (1947). The court is to weigh the "relative advantages and obstacles to a fair trial," id., and should consider public interest factors such as congestion in the courts, local relation to the controversy, and the imposition of jury duty on a community that has no relation to the litigation. Id. at 508-09. Consideration of the Gilbert factors "leaves much to the discretion" of the trial judge. Id. at 508.

 A. Existence of an Alternative Forum

 In this case, there is clearly an alternative forum. Defendant Stoy Hayward has represented both in its motion papers and to the Court during oral argument that it will consent to the jurisdiction of the English courts. Accordingly, Defendant is not only "amenable to process" in England, but will not contest personal jurisdiction there. Plaintiffs' contention that England cannot be considered an adequate forum because it does not provide precisely the same remedies is unpersuasive. "Some inconvenience or the unavailability of beneficial litigation procedures similar to those available in the federal district courts does not render an alternative forum inadequate." Borden, Inc. v. Meiji Milk Products Co., 919 F.2d 822, 829 (2d Cir. 1990) (quoting Shields v. Mi Ryung Constr. Co., 508 F. Supp. 891, 895 (S.D.N.Y. 1981)); see also Alcoa S.S. Co. v. M/V Nordic Regent, 654 ...


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