United States District Court, S.D. New York
OPINION & ORDER
A. ENGELMAYER, District Judge
case arises from the alleged breach of a 2009 contract, which
contemplated the merger of four entities, one a New York
corporation, into a larger corporation based overseas. Before
the Court is a motion by defendant Hinrichsen Foundation (the
"Foundation") to dismiss the complaint of plaintiff
Christian Hinrichsen, on three separate grounds: (1) lack of
personal jurisdiction, (2) forum non conveniens, and
(3) failure to state a claim. For the reasons that follow,
the Court dismisses the Complaint for lack of personal
jurisdiction over the Foundation without addressing the
Foundation's alternate grounds for dismissal.
contract dispute here has its roots in a family tragedy. The
forbearers of plaintiff Christian Hinrichsen
("Christian"), the Hinrichsen family, were subject
to persecution in Nazi Germany in the 1930s. Compl. at 3. Two
of Christian's ancestors were murdered at Auschwitz and a
third died in an internment camp. Id.
here, in 1939, C.F. Peters GmbH & Co., KG ("Peters
Germany"), a corporate entity owned by the family, was
subject to a forced sale as part of the Third Reich's
"Aryanization" program. Id. In 1942, one
of Christian's ancestors was able to
"re-engage" with Peters Germany and apparently
retook some or all ownership of the company. Id. at
4. Two other Hinrichsen entities were founded by family
members who emigrated from Germany to New York and London:
Peters Edition Ltd. ("Peters London"), and C.F.
Peters Corporation ("Peters New York").
Id. at 3-4. The three above-identified
"Peters" entities are central to the dispute here,
along with a fourth, Edition Peters GmbH ("Peters
GmbH"), whose provenance the pleadings leave unclear.
November 17, 2009, the interests in the various Peters
entities were held as follows. Peters Germany was jointly
owned by (1) Henry Hinrichsen ("Henry"),
Christian's father, (2) Martha Hinrichsen
("Martha"), Christian's aunt, (3) the
Foundation, and (4) others. Compl. Ex. 1 ("2009
Agreement") at 1. Shares of Peters GmbH were also
jointly held by Henry, Martha, and the Foundation.
Id. The capital-issued shares of Peters New York
were wholly owned by Henry and Martha. Id. Peters
London was wholly owned by the Foundation. Id. As to
residences of the owners, Henry was a resident of Vermont,
id., Martha was a resident of Connecticut,
id., and the Foundation is a British entity
headquartered in London, see Compl. at 2; Berg Decl.
November 17, 2009, Henry, Martha, Peters London, and the
Foundation entered into a written agreement that contemplated
the creation, by means of a re-organization and merger, of
yet a new Peters entity. Compl. at 4. The agreement
("2009 Agreement") referred to the new entity, for
the purposes of the agreement only, as "Newco." The
2009 Agreement provided that Henry, Martha, and the
Foundation would transfer all of their interest in the four
Peters entities-two of which were Frankfurt-based, one of
which was London-based, and one of which was New
York-based-to Newco. The new entity would ultimately take the
form either of Peters London or a "new group company to
be formed (under whatever name) to implement this
agreement." 2009 Agreement at 1.
the 2009 Agreement, Henry and Martha would each receive 15%
of the new entity's capital shares. 2009 Agreement at 2.
The Foundation would receive 70%. Mat 3. In addition, under
the 2009 Agreement, Henry and Martha agreed to enter into an
arrangement in which each would receive annual compensation
in return for providing consultancy services to Peters New
York or any successor in interest. Id. at 2.
Further, in the event of Henry's death within 10 years of
the completion of the transaction, the 2009 Agreement further
provided that Christian would either be appointed as a
consultant by the newly formed entity or receive, from the
Foundation, 5 percent of the new entity's then-issued
equity. Id. at 3.
1, 2010, Peters New York and Henry entered into a written
consulting agreement, as contemplated by the 2009
Agreement. See Berg Decl. Ex. G ("2010
Consulting Agreement"). The 2010 Consulting Agreement
provided that, if Henry died within 10 years of the
agreement, Peters New York would retain Christian for a term
of the lesser of "the period of three (3) years from the
date of [Henry's] death or ... the period of time between
the date of [Henry's] death and January 1, 2020."
2010 Consulting Agreement at 2. The 2010 Consulting
Agreement, however, did not refer to the alternative option
described in the 2009 Agreement in which Christian would
receive, in lieu of a paid consultancy at Peters New York, a
five percent interest in the new entity from the Foundation.
August 2010, consistent with the 2009 Agreement, Henry,
Martha, Peters London, Peters GmbH, and the Foundation
executed a partnership agreement ("2010 Agreement")
and formed a new entity, C.F. Peters, Ltd & Co. KG
("Peters KG"). Compl. at 5; Berg Decl. Ex. F
("2010 Agreement") at 1, 12. The company had three
limited partners (the Foundation, Henry, and Martha), and
three personally liable partners. 2010 Agreement at 2.
Relevant here, the 2010 Agreement did not mention Peters New
York, or Henry and Martha's consulting agreement with
Peters New York. The 2010 Agreement instead stated that:
This Agreement replaces all previous partnership agreements
between the parties. The agreement between the Hinrichsen
Foundation, Martha and Henry Hinrichsen and Peters Edition
Ltd, London dated November 17, 2009 remains in principle in
place unless this agreement deviates from it; in this case
the provisions of this agreement shall prevail.
Id. at 10. The 2010 Agreement further provided that
"German law shall apply to this agreement and its
interpretation." Id. As to dispute resolution,
it provided that "[i]f there is any dispute or
controversy between the partners arising out of or relating
to this agreement, the parties agree that such dispute or
controversy shall be arbitrated in accordance with the
Arbitration Rules of the German Institution of Arbitration
... [and that the] Venue of Arbitration shall be
September 7, 2011, Henry, Martha, and the Foundation amended
the 2010 Agreement ("2011 Agreement"). The amended
agreement did not change any terms relevant here.
See Compl. Ex. 2 ("2011 Agreement").
February 25, 2016, Henry passed away. Compl. at 5. Pursuant
to the 2009 Agreement, Christian made a timely request for
the transfer to him, from the Foundation, of five percent of
the equity of the new entity. Id. at 6. The
Foundation declined to do so. It took the position that, in
the 2010 Consulting Agreement, the parties had decided to
eliminate the equity transfer option described in the 2009
Agreement. Id. This lawsuit, in which Christian
seeks as relief the transfer of the five percent of the
equity to himself, followed.
February 15, 2017, Christian filed a complaint, alleging that
the Foundation had breached the 2009 Agreement by refusing to
transfer five percent equity in the new entity to him. Dkt.
16, 2017, the Foundation filed a motion to dismiss for lack
of personal jurisdiction under Federal Rule of Civil
Procedure 12(b)(2), for forum non conveniens under
Rule 12(b)(3), and for failure to state a claim under Rule
12(b)(6), Dkt. 8, and a supporting memorandum, Dkt. 9
(collectively, "MTD"). On July 12, 2017, Christian
filed a memorandum in opposition. Dkt. 13 ("Pi's