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Kiobel v. Royal Dutch Petroleum Co.

June 21, 2010

ESTHER KIOBEL, ET AL. PLAINTIFFS,
v.
ROYAL DUTCH PETROLEUM COMPANY, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Kimba M. Wood, U.S.D.J.

OPINION AND ORDER

This is a putative class action brought under the Alien Tort Statute ("ATS") against various Royal Dutch/Shell ("Shell") entities involving allegations of human rights abuses in Nigeria in the 1990s related to the Defendants' oil and development activities in the region. Defendant The Shell Petroleum Development Company of Nigeria ("SPDC"), a Shell Nigerian subsidiary, renews its motion to dismiss for lack of personal jurisdiction.

On November 16, 2009, the Court (1) granted Plaintiffs' motion for reconsideration of the Court's March 4, 2008 Order, dismissing SPDC as a defendant for lack of personal jurisdiction, and (2) ordered further jurisdictional discovery.*fn1 Kiobel v. Royal Dutch Petroleum Company, No. 02-Civ.-7618, 2009 WL 3817590 (S.D.N.Y. Nov. 16, 2009). That discovery is now complete.*fn2 For the reasons discussed below, the Court GRANTS SPDC's renewed motion to dismiss. (Dkt. No. 320.) Plaintiffs have failed to assert jurisdictional facts sufficient to establish "continuous and systematic general business contacts" with the United States as required for the assertion of general jurisdiction over SPDC. Fed. R. Civ. P. 4(k)(2); see Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 568 (2d Cir. 1996).

BACKGROUND

The facts and procedural history of this case are set forth in the Court's prior orders, familiarity with which is assumed. They are summarized here to the extent they are relevant.

Plaintiffs in this and the related actions in Wiwa*fn3 are a group of individuals who, along with their decedents, protested SPDC's oil exploration and development activities in the Ogoni region of southern Nigeria. Plaintiffs allege, inter alia, that these protests were suppressed, with violence, by agents of the Nigerian government, with the corporation and the assistance of SPDC and SPDC's corporate parents, formerly known as Royal Dutch Petroleum Company and Shell Transport and Trading Company (collectively, "Royal Dutch Shell").

I. Procedural History

Plaintiffs filed this putative class action on September 30, 2002 (the "Kiobel action").

Discovery and other pre-trial proceedings in this action have been largely coordinated with the prior related Wiwa actions.*fn4

On April 6, 2004, Wiwa Plaintiffs commenced a separate action against SPDC ("Wiwa III"), and on May 17, 2004, Kiobel Plaintiffs added SPDC as a defendant in this action. In November 2004, Defendant SPDC filed, in both actions, a motion to dismiss for lack of personal jurisdiction and a motion to preclude any further jurisdictional discovery.*fn5

In its March 8, 2008 Order, the Court granted SPDC's motion. The Court found that Plaintiffs failed "to establish a prima facie case of sufficient minimum contacts" with the forum - here the United States - for the Court to exercise jurisdiction over SPDC. Kiobel, 2008 WL 591869 at *10. The Court also found that Plaintiffs' jurisdictional allegations were "too vague and conclusory" to warrant further jurisdictional discovery. Id. In making these findings, the Court relied on the fact that Plaintiffs "[had] access to the extensive discovery taken in connection with the prior related actions, including discovery from SPDC." Id. at *2.

On April 16, 2008, the Wiwa III Plaintiffs appealed the Court's March 4, 2008 Order. The March 4, 2008 Order was a final ruling in Wiwa III (because it dismissed the sole defendant), but the Order dismissing SPDC from the Kiobel Amended Complaint was not a final ruling, and, therefore, was not ripe for appeal.

On June 3, 2009, the Second Circuit vacated this Court's March 4, 2008 Order. The Second Circuit concluded that it was "clear error" for this Court (1) to find that "discovery conducted in the related actions encompassed the issue of personal jurisdiction over SPDC,"*fn6 2009 WL 1560197 at *2, and (2) to have required Plaintiffs to include an averment of facts to support its prima facie case of jurisdiction - the standard courts apply when the motion is brought after discovery has been conducted. In a motion to supplement the record on appeal, Plaintiffs also submitted several documents that Plaintiffs obtained in discovery in the related cases after the Court's decision on SPDC's motion - documents that that Plaintiffs argued on appeal supported their jurisdictional allegations.

On remand, in Wiwa III, this Court was instructed to consider the relevance of the documents at issue, and to decide:

[W]hether continuing discovery in the related cases has now been sufficient [1] for [plaintiffs] to adequately allege personal jurisdiction over SPDC, [2] to show that [plaintiffs] are sufficiently unlikely to be able to establish jurisdiction, so as to justify dismissal once more or [3] to allow further jurisdictional discovery. Id. at *3. On June 8, 2009, the three Wiwa actions settled.

On June 24, 2009, Kiobel Plaintiffs moved for reconsideration of the Court's March 8, 2008 Order, which dismissed SPDC as a defendant from the Kiobel Amended Complaint. On November 16, 2009, this Court granted Plaintiffs' motion for reconsideration. The Court concluded that the "Second Circuit's June 3, 2009 Summary Order, which vacated the Court's March 4, 2008 Order . . . [was] a 'change in controlling law' that warrant[ed] reconsideration of the Court's (same) March 4, 2008 Order dismissing the Kiobel claims against SPDC." 2009 WL 3817590, at *2. The Court stated that:

The Second Circuit found that this Court committed clear error in finding that the prior related discovery included the relevant jurisdiction discovery with respect to SPDC. As a result, this Court applied the wrong standard on SPDC's motion to dismiss for lack of personal jurisdiction. The Court is also persuaded that this error impacted the Court's decision to preclude any further jurisdictional discovery. That decision assumed that it was unlikely Plaintiffs could, given the prior related discovery, uncover additional facts necessary to sustain jurisdiction. See Kiobel, 2008 WL 591869 at *10 (noting the "extensive discovery against all Defendants, including SPDC, in these and their related cases over the past ten years").

On reconsideration, the Court granted Plaintiffs' request to conduct further jurisdictional discovery. The Court ordered discovery with respect to certain categories of alleged business contacts between SPDC and the United States. These categories were related to Plaintiffs' allegations that: (1) a substantial quantity of SPDC-produced crude oil was imported into the United States by Shell International Trading Company ("SITCO"), a separate Shell entity, and that SITCO acted as SPDC's agent in doing so; (2) SPDC targeted the U.S. with a public relations campaign relating to SPDC's operations in Nigeria; (3) SPDC recruited employees in the U.S. through another Shell entity, Shell People Services ("SPS"); (4) SPDC employees came to the U.S. for training, and to attend seminars and conferences; (5) SPDC entered into contracts for services in the U.S. and received financial assistance from, the United States Agency for International Development ("USAID").*fn7 2009 WL 3817590 at *5. The Court stated that: "[o]nce discovery has been completed, the Court will be in a position to consider, with the benefit of a more complete evidentiary record, any renewed motion to dismiss filed by SPDC for lack of personal jurisdiction." Id. at 3.

In a memo endorsed letter, dated December 2, 2009, this Court referred all discovery disputes to Magistrate Judge Pitman. Discovery related to personal jurisdiction over SPDC concluded on February 8, 2010. On February 16, 2010, SPDC ...


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