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Elcan Industries, Inc. v. Cuccolini S.R.L

United States District Court, S.D. New York

March 21, 2014

ELCAN INDUSTRIES, INC., Plaintiff,
v.
CUCCOLINI S.R.L., PETERS EQUIPMENT, COMPANY, LLC, and ROBERT RAMSEY, Defendants.

MEMORANDUM DECISION AND ORDER

GEORGE B. DANIELS, District Judge.

Plaintiff Elcan Industries, Inc. brings this action seeking damages and injunctive relief based on alleged (a) breaches by Defendant Cuccolini of a distribution agreement with Elcan; (b) breaches by Cuccolini of the implied covenant of good faith and fair dealing; (c) tortious interference by Peters and Ramsey with Elcan's contractual relationship with Cuccolini; and (d) tortious interference with Elcan's other business relationships and opportunities by Peters and Ramsey, in collusion with Cuccolini; and (e) defamation of Elcan and its business by Cuccolini, Peters, and Ramsey.

Defendants Peters Equipment Company, LLC and Robert Ramsey (the "Peters Defendants") move to dismiss the Complaint for lack of personal jurisdiction under Fed.R.Civ.P. 12(b)(2) and failure to state a claim under Fed.R.Civ.P. 12(b)(6). Defendant Cuccolini brings a motion to dismiss Plaintiff's action in its entirety for forum non conveniens or, in the alternative, to dismiss Plaintiff's non-contractual causes of action for failure to state a claim under Fed.R.Civ.P. 12(b)(6). Plaintiff opposes the motions, and argues that the exercise of personal jurisdiction over the Peters Defendants is proper under New York law, that New York is an appropriate forum to adjudicate this dispute, and that Plaintiff has stated a claim for each cause of action against the Defendants.

The Peters Defendants' motion to dismiss for lack of personal jurisdiction is GRANTED. Cuccolini's motion to dismiss for forum non conveniens is DENIED. Cuccolini's motion to dismiss Plaintiff's breach of covenant of good faith and fair dealing, tortious interference, and defamation claims for failure to state a claim is GRANTED.

BACKGROUND

Plaintiff Elcan is a New York corporation that sells mechanical screening equipment. (Compl. ¶¶ 2, 12). Defendant Cuccolini is an Italian limited liability company with its principal place of business in Reggio Emilia, Italy. (Compl. ¶ 3). Elcan sells mechanical screening equipment, including those produced by Defendant Cuccolini, from its headquarters and sole business facilities in New York. (Compl. ¶ 14). Peters Equipment Company is a design and engineering firm that provides services exclusively to the coal and coke processing industries. (Declaration of Robert Ramsey in Support of Motion to Dismiss (hereinafter "Ramsey Decl.") at ¶ 2). Robert Ramsey is a citizen of Bluefield, Virginia, and a member of Peters Equipment Company, LLC, a Virginia-based company. (Id. at ¶¶ 1-2). On or about June 14, 2010, Elcan and Cuccolini entered into a Distribution Agreement (the "Agreement") concerning the sale and distribution of certain Cuccolini products. (Compl. ¶¶ 17, 18). The Agreement made Elcan the exclusive distributor of those products in the United States and a non-exclusive distributor in Canada for a period of 5 years. (Compl. ¶ 19).

On June 13, 2013, Plaintiff filed its Complaint against Defendants Cuccolini, Peters and Ramsey. Plaintiff alleges that the Peters Defendants tortiously interfered with Elcan's distribution agreement with Cuccolini "by unfair, dishonest or improper means and by agreeing to replace [Plaintiff] as the distributor of [Cuccolini mechanical screens] in the United States and in Canada." (Compl. ¶ 92). Specifically, Plaintiff alleges that "[u]pon information and belief, [the Peters Defendants] offered Cuccolini inducements in order to cause Cuccolini to terminate its agreement with [Plaintiff] immediately (and without cause) and to replace [Plaintiff with [the Peters Defendants], " and that "[u]pon information and belief, in order to cause Cuccolini to terminate its Agreement with [Plaintiff] immediately (and without cause), and to replace [Plaintiff with [the Peters Defendants], [the Peters Defendants] baselessly disparaged and defamed [Plaintiff in communications with Cuccolini, " (Compl. ¶¶ 42-43).

Second, Plaintiff alleges that the Peters Defendants-in concert with Cuccolini-tortiously interfered with Plaintiff's other business opportunities "by unfair, improper, or dishonest means, including false and misleading statements about [Plaintiff and its business, in order to obtain those customers for themselves." (Compl. ¶ 100). Specifically, Plaintiff alleges that "[u]pon information and belief, Cuccolini has colluded with [the Peters Defendants] to interfere with [Plaintiff's] business opportunities-i.e., pending sales by [Plaintiff] of Products- by defaming [Plaintiff], by falsely disparaging and attacking [Plaintiff's] reputation in the market in communications to [Plaintiff's] customers, and by refusing to deliver Products to [Plaintiff in accordance with orders placed by [Plaintiff, " and that "upon information and belief, [the Peters Defendants], in collusion with Cuccolini, have been and are soliciting [Plaintiff's] customers for Products, and are seeking to usurp [Plaintiff's] pending sales, notwithstanding the Agreement, by defamation of [Plaintiff's] business reputation." (Compl. ¶¶ 46, 53).

Third, Plaintiff alleges that the Peters Defendants, in concert with Cuccolini, "made false statements to [Plaintiff's] customers and prospective customers about the quality and nature of [Plaintiff's] business and capabilities, and concerning [Plaintiff's] ability and willingness to perform its obligations under the Agreement." (Compl. ¶ 105). Plaintiff alleges that "upon information and belief, Cuccolini [and/or the Peters Defendants] have made false and/or misleading disparaging statements to [Plaintiff's] customers about the quality of [Plaintiff's] business capabilities, about [Plaintiff's] ability and/or willingness to perform its obligations under the Agreement, and/or about its business competence." (Compl. ¶ 54). Plaintiff further alleges that "since June 5, 2013, several of [Plaintiff's customers have terminated negotiations with [Plaintiff] or manifestly cooled their relationships with [Plaintiff... [and] sudden changes of this kind are rare in [Plaintiff's] business." (Compl. ¶¶ 55-56).

I. LACK OF PERSONAL JURISDICTION OVER THE PETERS DEFENDANTS

To avoid dismissal under Rule 12(b)(2), a plaintiff has the burden of establishing personal jurisdiction over the defendant. Thomas v. Ashcroft, 470 F.3d 491 (2d Cir. 2006). Where no evidentiary hearing has been held, nor have the parties engaged in jurisdictional discovery, plaintiff need only make a prima facie showing on the basis of legally sufficient allegations of jurisdiction. In re Magnetic Audiotape Antitrust Litig., 334 F.3d 204, 206 (2d Cir. 2003). "The plaintiff cannot rely merely on conclusory statements or allegations; rather, the prima facie showing must be factually supported.'" Melnick v. Adelson-Melnick, 346 F.Supp.2d 499, 501 (S.D.N.Y. 2004) (citations omitted).

A court considering a motion to dismiss for lack of personal jurisdiction may consider "all pertinent documentation submitted by the parties" because such a motion is "inherently a matter requiring the resolution of factual issues outside of the pleadings." Mantello v. Hall, 947 F.Supp. 92, 95 (S.D.N.Y. 1996) (internal quotation marks omitted); accord Dauman v. Hallmark Card, Inc., No. 96 Civ. 3608, 1998 WL 54633, at *4 (S.D.N.Y. Feb. 9, 1998) (appropriate for court to weigh affidavits on personal jurisdiction issue); John Hancock Property and Casualty Ins. Co. v. Universale Reinsurance Co., Ltd., No. 91 Civ. 3644, 1992 WL 26765, at *6 (S.D.N.Y. Feb. 5, 1992); Canadian Group Underwriters Ins. Co. v. M/V Arctic Trader, No. 96 Civ. 9242, 1998 WL 730334, at *2 (S.D.N.Y. Oct. 19, 1998). All averments by plaintiff of jurisdictional facts must be accepted as true and pleadings and affidavits are to be construed in plaintiff's favor. In re Magnetic Audiotape, 334 F.3d at 206.

A federal court sitting in diversity may exercise personal jurisdiction to the same extent as courts of general jurisdiction in the state in which it sits. Fed.R.Civ.P. 4(k)(1)(A); Bank Brussels Lambert v. Fiddler Gonzalez & Rodriquez, 305 F.3d 120, 124 (2d Cir. 2002). To exercise jurisdiction pursuant to Fed.R.Civ.P. 4(k)(1)(a), (1) there must be a statutory basis for the exercise of jurisdiction under the applicable state law, here New York law, and (2) it must comport with the Due Process Clause of the Fourteenth Amendment. Id.

In New York, a plaintiff must demonstrate either that the defendant was "present" and "doing business" in New York within the meaning of New York Civil Procedure Law and Rules ("CPLR") § 301, or that the defendant committed acts within the scope of New York's long-arm statute, CPLR § 302, including: (i) transacting business in New York; (ii) committing a tortious act while physically present in New York; or (iii) committing a tortious act outside of New York that results in consequences in New York. Schulz v. Safra Nat'l. Bank of New York, 377 Fed.Appx. 101, 102 (2d Cir. 2010). Here, Plaintiff's allegations fail to establish either general ...


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