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BMW of North America LLC v. M/V Courage

United States District Court, S.D. New York

May 19, 2017

BMW OF NORTH AMERICA LLC, Plaintiff,
v.
M/V COURAGE, her engines, tackle, boilers, etc. in rem, et al., Defendants. HDI GLOBAL SE a/s/o DAIMLER AG, Plaintiff,
v.
M/V COURAGE, her engines, tackle, boilers, etc. in rem, et al., Defendants. INTERNATIONAL AUTO LOGISTICS, INC. Plaintiff,
v.
M/V COURAGE, her engines, tackle, boilers, etc. in rem, et al., Defendants.

          OPINION AND ORDER

          JESSE M. FURMAN, United States District Judge

         On June 2, 2015 a fire broke out on board an American-bound vessel damaging or destroying millions of dollars' worth of motor vehicles. These three related cases are brought by the owners and insurers of those motors vehicles: Axa Corporate Solutions Deutschland (“Axa”), BMW AG (“BMW”), HDI Global SE, Daimler AG (“Daimler”), and International Auto Logistics (“IAL”, collectively, with Axa, BMW, and Daimler, “Plaintiffs”). Specifically, each brings suit against different arrays of the following entities: the shipper of the goods, GovLog NV (“GovLog”); the time charterer/operator of the vessel, American Roll-Off Carrier LLC (“ARC”); the registered owner of the vessel, Fidelio Limited Partnership, Inc. (“Fidelio”); the technical manager of the vessel, Tote Service Inc. (“Tote”); a charterer of certain spaces on the vessel, Wallenius Wilhelmsen Logistics (“WWL” and, together with ARC, Fidelio, and Tote, the “Vessel Interests”); the owner of the vehicle suspected of causing the fire, Mary Smith, and her employer, the United States; and the manufacturer of Smith's vehicle, Ford Motor Company (“Ford”). (See 16-CV-4063 Docket No. 77 (“Fifth Am. Compl.”); 16-CV-4125 Docket No. 53 (“Daimler Compl.”); 16-CV-4149 Docket No. 55 (“IAL Compl.”)).[1] As relevant here, both Ford and the Vessel Interests, in turn, bring cross-claims against GovLog. (Docket No. 90 (“Ford Crossclaims”) ¶ 169; Docket No. 91 (“Vessel Interest Crossclaims”) ¶¶ 194-200).

         On January 20, 2017, GovLog moved, pursuant to Rule 12(b) of the Federal Rules of Civil Procedure, to dismiss most (but not all) of the claims and cross-claims against it for lack of personal jurisdiction, improper venue, and on forum non conveniens grounds. (Docket No. 84). On May 15, 2017, the Court issued a “bottom-line” Order indicating that for reasons to be provided in a forthcoming Opinion, GovLog's motions were denied. (Docket No. 118). This is that Opinion.

         BACKGROUND

         The relevant facts, taken from the pleadings and affidavits except as otherwise noted, are viewed in the light most favorable to the non-moving parties - that is, Plaintiffs and Cross-Claimants. See Chloe v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158, 163 (2d Cir. 2010).

         GovLog is a Belgian corporation with headquarters in Antwerp that has contracted with the United States Government to ship vehicles and other personal property of U.S. Government employees to the United States. (Fifth Am. Compl. ¶¶ 9, 84-85; Vessel Interest Crossclaims ¶¶ 167-68, 171). In March 2015, a division of the U.S. Department of State issued a tender for bids to perform logistics services for Government employees shipping goods to the United States between May 2015 and April 2016. (Docket No. 115 (“Pls. Suppl. Ltr.”), at 2). GovLog bid on the project and, in May 2015, it was awarded a contract to transport property between Europe and New York, Baltimore, Miami, and Seattle. (Pls. Suppl. Ltr., Ex. 3). Soon thereafter, GovLog approached ARC, the time charterer/operator of the M/V Courage - an ocean-going “roll on roll off” car carrier flying the flag of the United States - to ship a 2002 Ford Escape owned by Mary Smith, a U.S. Government employee, from Antwerp, Belgium, to Baltimore, Maryland. (Fifth Am. Compl. ¶ 20; Vessel Interest Crossclaims ¶¶ 168-175; Docket No. 103 (“Santianna Decl.”) ¶¶ 2, 7). Plaintiffs allege that, during the M/V Courage's voyage to the United States in June 2015, Smith's Ford Escape caused a fire to break out on board the vessel, which caused damage to 187 BMW automobiles at a cost of $7.3 million; 757 Daimler vehicles at a cost of $33.1 million; and 221 personally owned vehicles being shipped by IAL worth approximately $4.75 million. (Fifth Am. Compl. ¶¶ 15, 18-20; Daimler Compl. ¶ 19; IAL Compl. ¶ 66). In addition to the losses sustained by Plaintiffs, the Vessel Interests allege damages to the ship (and other expenses as a result of the fire) in the amount of $35 million. (Vessel Interest Crossclaims ¶ 200).

         GovLog has been shipping cargo with ARC for over twenty years and, since 2003, has shipped approximately 450 vehicles a year with ARC. (Santianna Decl. ¶ 5; see also Vessel Interest Crossclaims ¶ 168). Each shipment, including the shipment of the Escape, is governed by a Bill of Lading and ARC's standard terms and conditions, which have not changed since 1999. (Santianna Decl. ¶¶ 8-10). Significantly, the Bill of Lading governing the Escape shipment includes a jurisdictional clause pursuant to which the parties agreed that “[a]ny dispute arising under this [Bill of Lading] shall be decided in the U.S. Federal Court in the City of New York to the exclusive jurisdiction of which the Carrier and the Merchant submit themselves.” (Fifth Am. Compl. ¶ 21; Santianna Decl. Ex. 3 (“Bill of Lading”) Clause 5). The Bill of Lading defines “Merchant” to include GovLog (as the “Shipper”) and “Carrier” to include both ARC and Fidelio (as the “owner of the ship”). (Bill of Lading, Clause 2). Notably, the Bill of Lading also includes a so-called “Himalaya Clause, ” which protects the Carrier's agents and servants to the same extent that the Carrier is protected. (Id., Clause 15 (providing that “every exemption, limitation, condition and liberty herein contained and every right, exemption from liability, defense and immunity of whatsoever nature applicable to the Carrier or to which the Carrier is entitled hereunder shall also be available and shall extend to protect every such Servant or Agent of the Carrier”)). Finally, to the extent relevant here, the Bill of Lading includes a provision regarding “Dangerous Cargo, ” which states that “the Merchant (whether aware of their nature or not) shall be liable for all damages and expenses directly or indirectly arising out of or resulting from such shipment.” (Id., Clause 20).

         Plaintiffs assert claims against (1) the Vessel Interests, for breach of the contract of carriage, relying upon the provisions of the Carriage of Goods by Sea Act (“COGSA”), 46 U.S.C. § 1300 et seq.; (2) the United States, as Mary Smith's employer, pursuant to the Suits in Admiralty Act, 46 U.S.C. § 30901, et seq., alleging breaches under COGSA and for negligence; (3) Ford, for product liability and negligence; and (4) GovLog, for violations of COGSA and for negligence. (Fifth Am. Compl. ¶¶ 41, 46, 51, 55, 61, 68, 79, 83, 105). Both Ford and the Vessel Interests, in turn, bring cross-claims against GovLog. Each asserts cross-claims for contribution or indemnity; in addition, the Vessel Interests seek recovery for their direct damages as a result of the fire. (Ford Crossclaims ¶¶ 169-70; Vessel Interest Crossclaims ¶¶ 161-203). As noted, GovLog moves, pursuant to Rule 12(b), to dismiss all claims against it for a lack of personal jurisdiction, improper venue, and on forum non conveniens grounds. Plaintiffs, Ford, and the Vessel Interests all oppose GovLog's motion.

         LEGAL STANDARD

         In the absence of discovery or an evidentiary hearing, a plaintiff seeking to defeat a motion to dismiss pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure for absence of personal jurisdiction or pursuant to Rule 12(b)(3) for improper venue need only make a prima facie showing that jurisdiction exists and venue is proper. See, e.g., Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005). Such a showing “entails making ‘legally sufficient allegations . . ., ' including ‘an averment of facts that, if credited[, ] would suffice'” to establish that jurisdiction exists and venue is proper. Penguin Grp. (USA) Inc. v. Am. Buddha, 609 F.3d 30, 35 (2d Cir. 2010) (quoting In re Magnetic Audiotape Antitrust Litig., 334 F.3d 204, 206 (2d Cir. 2003) (per curiam)). See generally Dorchester Fin. Sec., Inc. v. Banco BRJ, S.A., 722 F.3d 81, 84-85 (2d Cir. 2013). A court must “view[] all facts in the light most favorable to the non-moving party.” TradeComet.com LLC v. Google, Inc., 647 F.3d 472, 475 (2d Cir. 2011).

         DISCUSSION

         As noted, GovLog moved to dismiss all claims against it for a lack of personal jurisdiction, improper venue, and on forum non conveniens grounds. The Court will address each of GovLog's arguments in turn.

         A. Personal Jurisdiction

         Stray language in its briefing aside, GovLog effectively concedes that personal jurisdiction exists with respect to ARC's contract claims. (Docket No. 86 (“GovLog Mem.”), at 24). That is for good reason: The Bill of Lading between GovLog and ARC contains a forum selection clause in which GovLog agreed that the federal courts in New York City would be the “exclusive jurisdiction” for “[a]ny dispute arising under this [Bill of Lading].” (Bill of Lading, Clause 5). GovLog does not argue, and the Court sees no basis to find, that this forum selection clause is invalid or inapplicable. See M/S Bremen v. Zapata Off-Shore Co.,407 U.S. 1, 10 (1972) (holding that forum selection clauses in the admiralty context “are prima facie valid and should be enforced unless enforcement is shown by the resisting party to be ‘unreasonable' under the circumstances”); Bluefire Wireless, Inc. v. Cloud9 Mobile Commc'ns, Ltd., No. 09-CV-7268 (HB), 2009 WL 4907060, at *3 (S.D.N.Y. Dec. 21, 2009) (“The Second Circuit has endorsed an expansive reading of the scope of forum selection clauses, in keeping with the policy favoring their use.”). It follows that there is plainly personal jurisdiction with respect to ARC's contract claims. See, e.g., D.H. Blair & Co., Inc. v. Gottdiener,462 F.3d 95, 103 (2d Cir. 2006) (‚ÄúParties can consent to personal jurisdiction through forum-selection clauses in contractual ...


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