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Export-Import Bank of the United States v. Hi-Films S.A. de C.V.

September 24, 2010

EXPORT-IMPORT BANK OF THE UNITED STATES, PLAINTIFF,
v.
HI-FILMS S.A. DE C.V., MIGUEL ANGEL PEREDO LUNA, ADRIAN PEREDO LUNA, AND GABRIELA PEREDO LUNA, DEFENDANTS.



The opinion of the court was delivered by: Paul G. Gardephe, U.S.D.J.

MEMORANDUM OPINION AND ORDER

In this action, Plaintiff Export-Import Bank of the United States (the "Bank") brings breach of contract claims against Defendants Hi-Films S.A. de C.V. ("Hi-Films"), Miguel Angel Peredo Luna, Adrian Peredo Luna, and Gabriela Peredo Luna arising from multiple promissory notes. The Bank seeks to recover monies due under promissory notes executed by Hi-Films and to enforce guarantees of payment made by Defendants Miguel Peredo Luna, Adrian Peredo Luna, and Gabriela Peredo Luna.

Defendant Miguel Angel Peredo Luna ("Luna") has moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(2) for lack of personal jurisdiction and on forum non conveniens grounds. In the alternative, Luna asks this Court to stay this action.*fn1

For the reasons stated below, Luna's motion to dismiss and request for a stay will be DENIED.

BACKGROUND

Export-Import Bank of the United States is a corporation organized and existing under federal law as an agency of the United States, created pursuant to 12 U.S.C. § 635. (Cmplt. ¶ 1) The Bank is the official export credit agency for the United States, and promotes domestic exports by providing financial support for sales to foreign purchasers. (Id. ¶ 9) Under its export credit insurance program, the Bank insures loans made by financial institutions to foreign borrowers for these borrowers' purchase of U.S. goods and services. (Id. ¶ 11) "In the event of a payment default by a borrower (and by any third-party guarantor of the borrower's obligations), the insured lender files a claim for payment with Ex-Im Bank under its export credit insurance policy." (Id.) The Bank then pays to the lender an amount up to the "outstanding principal and interest on the loan and is assigned the lender's rights to the debt and any associated security interests." (Id. ¶ 12) This suit arises from a series of transactions approved under the Bank's export credit insurance program. (Id. ¶ 13)

Hi-Films is a corporation organized and existing under the laws of Mexico, with its principal place of business in Mexico City, Mexico. (Id. ¶ 5) The Bank alleges that Luna resides in San Diego County, California. (Id. ¶ 6) Luna disputes this allegation, stating that he lives in Huertas Del Carmen, Queretaro, Mexico. (Luna Decl. ¶ 2; Luna Br. 6)For purposes of this motion, this Court will assume that Luna resides in Mexico.

The Complaint alleges that on August 25, 2004, Hi-Films, as borrower, and Defendants Miguel Peredo Luna, Adrian Peredo Luna, and Gabriela Peredo Luna, as guarantors, executed an agreement entitled "Eximbank Insured Medium Term Export Credit Facility" (Cmplt., Ex. A (the "August 25, 2004 Sterling Loan Agreement")) with Sterling Bank ("Sterling"), as lender, to obtain a loan in the amount of $2,534,513.00 to finance the purchase of plastic film-making equipment. (Id. ¶ 14) On September 8, 2004, Hi-Films executed a promissory note (Cmplt., Ex. B (the "September 8, 2004 Sterling Note")) payable to the order of Sterling or its successor or assignee, promising to pay the full $2,543,513.00 in ten installments, plus interest, as specified in the note. (Id. ¶ 15) Defendants Miguel Peredo Luna, Adrian Peredo Luna and Gabriela Peredo Luna ("the Personal Guarantors") jointly and severally, and irrevocably and unconditionally, guaranteed the payment of the September 8, 2004 Sterling Note. (Id. ¶ 16)

On or about November 8, 2004, Hi-Films, as borrower, and the Personal Guarantors, as guarantors, executed another agreement entitled "Eximbank Insured Export Credit Facility" (Cmplt., Ex. F (the "November 8, 2004 Sterling Credit Agreement")) with Sterling, as lender, to obtain a revolving line of credit in the maximum amount of $2 million to finance the purchase of plastic film, resin and related products. (Id. ¶ 30) Under the terms of the November 8, 2004 Sterling Credit Agreement, "Hi-Films received four loans from Sterling, each of which was made pursuant to a promissory note, with the total of these loans amounting to $1,998,694.72." (Id. ¶ 31; see id., Exs. G-J (collectively "the 2005 Sterling Notes")) Hi-Films, as borrower, and the Personal Guarantors, as guarantors, executed these promissory notes on May 3, 2005 (Cmplt., Ex. G (the "May 3, 2005 Sterling Note")), for $600,000 to be paid, plus interest, on October 22, 2005; on May 13, 2005 (Cmplt., Ex. H (the "May 13, 2005 Sterling Note")), for $599,950 to be paid, plus interest, on November 4, 2005; on September 2, 2005 (Cmplt., Ex. I (the "September 2, 2005 Sterling Note")) for $401,236 to be paid, plus interest, on February 22, 2006; and on September 7, 2005 (Cmplt., Ex. J, the "September 7, 2005 Sterling Note") for $398,744.00 to be paid, plus interest, on March 1, 2006. (Id. ¶¶ 32-60).

On or about June 15, 2004, Hi-Films, as borrower, and the Personal Guarantors, as guarantors, executed a Term Credit Agreement with WorldBusiness Capital, Inc. ("WBC"), as lender, to obtain a line of credit in the maximum amount of $2,368,671 to finance the purchase of plastic extrusion equipment. (Cmplt. ¶ 72, Ex. M (the "June 15, 2004 WBC Credit Agreement")) On June 16, 2004, Hi-Films executed a promissory note payable to the order of WBC or its successor or assignee, in the principal amount of $2,368,671 to be paid in nine installments, plus interest. (Id. ¶ 73, Ex. N (the "June 16, 2004 WBC Note"))

On or about November 15, 2005, Hi-Films defaulted on the September 8, 2004 Sterling Note. (Id. ¶ 23) In a letter dated March 7, 2006, Sterling demanded payment under the September 8, 2004 Sterling Note and each of the 2005 Sterling Notes, and notified Hi-Films and the Personal Guarantors that they were in default under these promissory notes. (Id. ¶¶ 24, 66, Ex. C (the "March 7, 2006 Sterling Demand Letter")) On or about March 8, 2006, Sterling filed a Notice of Claim and Proof of Loss with the Bank in which Sterling, inter alia, assigned the Bank "all right, title and interest in, and all sums of money now due, or to become due" under the 2005 Sterling Notes in the event that the Bank paid part of the loss that Sterling had incurred. (Id. ¶ 67, Ex. K (Mar. 8, 2006 Notice of Claim and Proof of Loss)) On March 10, 2006, Sterling filed a Notice of Claim and Proof of Loss with the Bank in which Sterling, inter alia, assigned to the Bank "all right, title and interest in, and all sums of money now due, or to become due" to Sterling from Hi-Films and the Personal Guarantors under the September 8, 2004 Sterling Note. (Id. ¶ 25, Ex. D (Mar. 10, 2006 Notice of Claim and Proof of Loss)) The Bank then paid Sterling the principal amount due plus interest, and -- in letters dated April 19, 2006 (Id., Ex. E (the "April 19, 2006 Ex-Im Demand Letters")) -- demanded payment from Hi-Films and the Personal Guarantors for the amount due under the September 8, 2004 Sterling Note. (Id. ¶¶ 26-27)

Hi-Films ultimately defaulted on all promissory notes made to Sterling: on or about October 22, 2005, Hi-Films defaulted on the May 3, 2005 Sterling Note; on or about November 4, 2005, Hi-Films defaulted on the May 13, 2005 Sterling Note; on or about February 22, 2006, Hi-Films defaulted on the September 2, 2005 Sterling Note; and on or about March 1, 2006, Hi-Films defaulted on the September 7, 2005 Sterling Note. (Id. ¶¶ 61-64) And on or about March 5, 2006, Hi-Films defaulted on the June 16, 2004 WBC Note. (Id. ¶ 80)

As each of the 2005 Sterling Notes became due and payment was not made, Sterling and the Bank demanded payment from Hi-Films and the Personal Guarantors. (Id. ¶¶ 65, 66, 69) Hi-Films, Luna, and the other Personal Guarantors never made any payment to Sterling or to the Bank in response to the written demands, however. (Id. ¶ 70)

On or about March 8 and March 20, 2006, Sterling assigned all remaining Sterling promissory notes and the WBC promissory note, respectively, to the Bank, which paid Sterling the total past principal and interest installments due under the notes. (Id. ¶¶ 67-68)

The Bank alleges that as of March 4, 2009, the total outstanding balance due the Bank under the Sterling Promissory Notes is $2,770,238.65 (Id. ¶ 71), while $2,762,810.30 is due and owing under the WBC Promissory Note. (Id. ¶ 87) "Pursuant to the terms of these promissory notes, interest continues to accrue." (Id. ¶ 71)

The terms of the promissory notes are virtually identical. Each promissory note contains a forum selection clause stating that

[f]or any legal action or proceeding with respect to this Note, the Maker, the lender and any other signatories hereof expressly submit themselves to any Federal District Court of the United States of America in New York, or the District of Columbia, or to any competent court in Mexico City, Federal District, United Mexican States, or to the courts of the domicile of the Maker, at the election of the holder hereof, wherefore they waive expressly any other jurisdiction to which they might have a right, including, but not limited to, every jurisdiction by reason of their present or future domiciles or by reason of the place of payment of this Note. (September 8, 2004 Sterling Note, at 7-8; May 3, 2005 Sterling Note, at 4; May 13, 2005 Sterling Note, at 4; September 2, 2005 Sterling Note, at 4; September 7, 2005 Sterling Note, at 4; June 16, 2004 WBC Note, at ¶ XI) (hereinafter "Forum Selection Clause")

Each personal guarantee provision executed by the Personal Guarantors states: To the maximum extent permitted by law, the undersigned also waives all defenses of the Maker and all defenses of a surety or guarantor to which it might be entitled by statute or otherwise. (September 8, 2004 Sterling Note, at 11; May 3, 2005 Sterling Note, at 7; May 13, 2005 Sterling Note, at 7; September 2, 2005 Sterling Note, at 7; September 7, 2005 Sterling Note, at 7; June 16, 2004 WBC Note, at 7) (hereinafter "Waiver Provision"); (see also Cmplt. ¶ 21). Hi-Films and the Personal Guarantors further agreed that New York state law would apply to any action brought in a U.S. court seeking to enforce the terms of the promissory notes. (Cmplt. ¶ 77; September 8, 2004 Sterling Note, at 7; May 3, 2005 Sterling Note, at 4; May 13, 2005 Sterling Note, at 4; September 2, 2005 Sterling Note, at 4; September 7, 2005 Sterling Note, at 4; June 16, 2004 WBC Note ¶ X) (hereinafter "Choice of Law Clause")

The Bank filed this suit on April 8, 2009, alleging, inter alia, breach of contract claims against Hi-Films and the Personal Guarantors in connection with their failure to make payment on the Sterling Promissory Notes and the WBC Promissory Note. (Cmplt. ¶¶ 88-135) Luna filed the instant motion on September 17, 2009. (Docket No. 11)

DISCUSSION

Luna has moved to dismiss, contending that this Court lacks personal jurisdiction over him, and that this action should be dismissed on forum non conveniens grounds. In the event that this action is not dismissed, Luna argues ...


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