The opinion of the court was delivered by: Haight, Senior District Judge.
MEMORANDUM OPINION AND ORDER
On remand from the Court of Appeals, this Court is again
presented with the question whether a French corporation and its
American subsidiary may properly invoke the anti-trust laws of
the United States to challenge the conduct of another French
corporation, albeit an independent public legal body, whose
conduct, the plaintiff alleges, violates the Sherman Act,
15 U.S.C. § 2. The case is before the Court on the defendants'
motion to dismiss for lack of subject matter jurisdiction under
The factual background of this case is discussed in two prior
opinions, Filetech S.A.R.L. v. France Telecom, 978 F. Supp. 464,
466 (S.D.N.Y. 1997), vacated and remanded Filetech S.A. v.
France Telecom, 157 F.3d 922 (2d Cir. 1998). While familiarity
with these opinions is assumed, the following discussion will
benefit from a restatement of the facts.
The plaintiff, Filetech S.A. ("Filetech"), formerly known as
Filetech S.A.R.L., is a French corporation established by a
Frenchman, Guy Birenbaum, for the purpose of assembling a
database of information from which to sell marketing lists.
Filetech primarily sells data collected in France to French
businesses, though, as this lawsuit makes clear, it aspires to
penetrate additional markets. To that end, Filetech incorporated
Filetech U.S.A., Inc. in 1994 in the State of New York to handle
the parent company's nascent U.S. operations. Filetech has
registered its business office in the State of New Jersey,
though according to the record no business has been conducted
there. I will refer to the corporations collectively as
"Filetech" or "plaintiff."
The defendant, France Telecom S.A. ("France Telecom"), is a
French corporation with its principal place of business in
France. At the time the complaint was filed, France Telecom was
an independent public legal entity, wholly owned and operated by
the Republic of France, controlling all telephone facilities in
the Republic. Directives of the European Union have subsequently
ended this monopoly and required the government of France to
reduce itself to majority shareholder status in what is now a
publicly traded company. France Telecom, Inc. is the wholly
owned subsidiary of France Telecom, incorporated in the State of
New York with its principal place of business there.
The Orange List came into existence as the result of French
statutes and regulations. In January 1978 the French legislature
enacted the Data Processing and Individual Rights Law ("the
Act") which created the Data Processing and Individual Rights
National Commission, popularly known as "CNIL." CNIL regulates
public and private data processing activities. The Act also set
forth substantive and procedural rules on processing this data.
Pursuant to Article 26 of the Act, any individual may in good
faith refuse to allow personal data bearing on him or her to be
computer processed. Breach of this Article is punishable under
the French penal code. Consistent with the Article, French law
permits French residents to prevent inclusion of their names on
commercial mailing lists.*fn1 Pursuant to this law, France
Telecom is required to maintain a current list of telephonic
subscribers who do not want their names used for marketing
purposes. This compilation of names is called the Orange List.
France Telecom maintains that it is forbidden by French law
from disclosing the names of the individuals on the Orange List,
and it has accordingly refused to give Filetech, or any other
requester, such information.*fn2 Instead, France Telecom
offers services which allow customers to purchase information
from its database purged of the Orange List entries. Filetech
has long argued that such a position ensures a monopoly for
France Telecom, since no other data base provider has possession
of the Orange List, without which no other provider can be kept
apprized of which French residents may have requested to be
placed on the List or, for that matter, taken off it. Without a
regularly updated copy of the Orange list, says Filetech, no
company in the commercial mailing list business can safely
market its services without the risk of violating French law.
The Orange List is akin to a map indicating the placement and
movement of land mines in a desert; without the map, no one
dares to traverse the territory. Currently, Filetech argues,
France Telecom alone has a regularly updated copy of that "map,"
without which Filetech is prevented from competing against
France Telecom in the marketing list business.*fn3
In addition to the case at bar, Filetech has commenced
numerous legal actions in
France against France Telecom. That litigation, some of it begun
nearly a decade ago, appears to be unresolved.*fn4 It is
sufficient for present purposes to note, as did the Second
Circuit, that "as far as this Court can tell, based in part on a
lack of final decisions on the merits and on the seemingly
conflicting dictates of French judicial and regulatory
authorities, it remains unsettled in France what conduct is
permissible on the part of France Telecom S.A. and Filetech S.A.
with respect to the marketing lists business." Filetech S.A.,
157 F.3d at 928.
Until recently, France Telecom had made data from its list of
subscribers available to third parties principally through two
services, "Teladresses" and "Marketis."*fn5 Since the
telephone directories themselves contain the Orange List names,
only these two services perform the function of purging such
entries and delivering a legally acceptable list to customers.
Marketis is a service accessible through either a personal
computer equipped with a modem, or through "Minitel," a terminal
provided by France Telecom to its customers upon request.
Through either of these two methods a tailored list purged of
Orange List names can be created. Teladresses is a
non-electronic service enabling a customer to order from France
Telecom a list with specific, tailored information. France
Telecom generates the list, purged of the Orange List entries,
and sends it to the customer with a bill for services. According
to France Telecom, Marketis is designed for those looking to
compile small lists, while Teladresses allows for the
compilation of millions of entries.
Though for a time Filetech was apparently able to circumvent
this system requirement, France Telecom limits free access
through Minitel to three minutes, in part to prevent massive,
costless downloading of its information. In other words,
companies seeking to create large scale databases of information
from the telephone directory are left with no alternative but,
in one way or another, to compensate France Telecom for its
services. Because acquisition of a comprehensive, regularly
updated, cleansed list from France Telecom, through Teladresses,
would allegedly cost millions of dollars, Filetech contends that
this regime prevents competition in the market. Filetech, since
the inception of this litigation, repeatedly alleges that France
Telecom's monopolistic behavior, in refusing to supply others
with the Orange List, constitutes a violation of French and U.S.
In 1995 Filetech filed suit in this Court against France
Telecom, charging it with monopolization in violation of the
Sherman Act. 15 U.S.C. § 2. Filetech seeks treble damages and
injunctive relief from France Telecom's alleged restraints on
trade in the United States. Filetech also demands access to
France Telecom's directory without paying the charges normally
incurred through the use of Marketis or Teladresses.
On June 5, 1995 France Telecom moved to dismiss the complaint,
pursuant to Fed.R.Civ.Pro. 12(b),*fn6 the doctrine of
international comity, and because the district court lacked
subject matter jurisdiction under the Foreign Sovereign
Immunities Act ("FSIA"), 28 U.S.C.A. § 1605(a)(2), and the
Sherman Act, as amended by the Foreign Trade Antitrust
Improvements Act ("FTAIA"), 15 U.S.C.A. § 1, 6a (West 1997).
On September 15, 1997 this Court dismissed Filetech's
complaint. Though concluding that Filetech's allegations, while
"sparse and largely conclusory," satisfied the standards for
jurisdiction imposed by the FSIA and the FTAIA, the Court
declined jurisdiction on the grounds of international comity.
Filetech S.A.R.L., 978 F. Supp. at 482.
In 1998 the Court of Appeals vacated that holding and remanded
the case to this Court with instructions that the Court first
determine whether subject matter jurisdiction exists, prior to
considering the question of international comity. Filetech
S.A., 157 F.3d at 932. The Second Circuit said that "[i]t
appears to us that the case at bar presents substantial and
unresolved questions in regard to jurisdiction over France
Telecom under the FSIA, the FTAIA and the caselaw governing
Sherman Act jurisdiction." Id. at 931. The Court continued as
[I]t was error for the district court to accept the
mere allegations of the complaint as a basis for
finding subject matter jurisdiction . . . . In these
circumstances, the court should have looked outside
the pleadings to the submissions. The district court
should consider all the submissions of the parties
and may hold an evidentiary hearing, if it considers
such a hearing is warranted, in resolving the
question of jurisdiction. Before arriving at its
legal conclusion regarding the existence vel non of
subject matter jurisdiction, the district court
should resolve the disputed factual matters by means
of findings of fact.
Following this ruling by the Second Circuit, this Court
directed the parties to conduct discovery on the question of
subject matter jurisdiction. Following completion of that
discovery, defendants now move to dismiss the case for lack ...