EXHIBIT (G) (5)
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
------------------------------------------------------x
:
BRICKELL PARTNERS, a Florida :
Partnership, Individually On Its Own :
Behalf And On Behalf Of All Others :
Similarly Situated, :
: Index No. 603493/97
Plaintiff, :
: NOTICE OF MOTION
- against - : TO DISMISS
:
XXXXX-XXXXXXX S.A., : ORAL ARGUMENT
: REQUESTED
Defendant. :
:
------------------------------------------------------x
PLEASE TAKE NOTICE, that upon the affidavit of Xxxxx Xxxxxx, sworn to
August 8, 1997, the accompanying memorandum of law, and upon the pleadings in
this action, Defendant Xxxxx-Xxxxxxx S.A. will move this Court on September 9,
1997, at the Motion Support Office Courtroom (Room 130), 00 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx at 9:30 a.m. or as soon thereafter as counsel may be heard, for
an order pursuant to Sections 3211(a)(2), 3211(a)(8) and 327 of the New York
Civil Practice Law and Rules:
(a) Dismissing the Complaint in its entirety for lack of proper service;
(b) Dismissing the Complaint for lack of personal jurisdiction;
(c) Dismissing the Complaint for lack of subject matter jurisdiction;
(d) Dismissing the Complaint based on the doctrine of forum non
conveniens; and
2
(e) Awarding such other and further relief as the Court may deem just
and equitable.
PLEASE TAKE FURTHER NOTICE that, pursuant to CPLR (S) 2214(b), answering
affidavits, if any, shall be served at least seven (7) days prior to the return
date of this motion.
Dated: New York, New York
August 11, 1997
SHEARMAN & STERLING
Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
Attorneys for Defendant Xxxxx-Xxxxxxx S.A.
To: XXXXXXXX XXXXXXX XXXXXXXX
& XXXXXX LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
Attorneys for Plaintiff
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
------------------------------------------------------x
:
BRICKELL PARTNERS, FLORIDA :
PARTNERSHIP, INDIVIDUALLY ON ITS OWN :
BEHALF AND ON BEHALF OF ALL OTHERS :
SIMILARLY SITUATED, :
: Index No. 603493/97
Plaintiff, :
:
v. :
:
XXXXX-XXXXXXX S.A., :
:
Defendant. :
:
------------------------------------------------------x
AFFIDAVIT OF XXXXX X. XXXXXX IN SUPPORT OF
XXXXX-XXXXXXX S.A.'S MOTION TO DISMISS THE COMPLAINT
----------------------------------------------------
COUNTRY OF FRANCE)
) SS.:
CITY OF PARIS )
XXXXX X. XXXXXX, being duly sworn, deposes and says:
1. I am a senior legal counsel of Xxxxx-Xxxxxxx S.A. based in Courbevoie,
France. The following facts are true to the best of my knowledge.
2. Xxxxx-Xxxxxxx S.A. ("RPSA") is a French Societe anonyme organized and
existing under the laws of the French Republic.
3. RPSA's legal headquarters are in Courbevoie, France.
4. RPSA is not a citizen of any State of the United States.
5. RPSA is not registered or otherwise licensed to do business in New
York.
6. RPSA does not maintain an office, mailing address, telephone listing
or bank account in New York.
7. RPSA does not own or lease any property or real estate in New York.
8. RPSA is not required to pay sales, use or any other tax in New York.
9. RPSA does not contract to supply goods in New York.
10. RPSA does not market goods or advertise goods in New York.
11. RPSA has never held a shareholders' meeting in New York.
12. Xxxxx-Xxxxxxx Inc. ("RPI"), a New York Corporation with its principal
place of business in Cranbury, New Jersey, is an indirect subsidiary of RPSA.
13. RPI is a free-standing corporation, with sales in 1996 of
approximately 52.3 billion dollars. RPI and RPSA observe all traditional
corporation formalities.
14. RPI and RPSA each maintain their own bank accounts, accounting
systems, payroll systems, financial records and budgets.
15. RPI and RPSA have separate boards of directors, with no commonality of
directors between the two companies.
16. RPI and RPSA each file separate tax returns.
17. RPI and RPSA do not commingle corporate assets.
18. RPSA does not exercise any control over RPI's day-to-day business
operations.
/s/ Xxxxx X Xxxxxx
----------------------
Xxxxx X. Xxxxxx
[NOTARY STAMP APPEARS HERE]
INDEX NO. 603493/97
================================================================================
NEW YORK SUPREME COURT
COUNTY OF NEW YORK
--------------------
BRICKELL PARTNERS,
A FLORIDA PARTNERSHIP, INDIVIDUALLY ON ITS OWN BEHALF AND
ON BEHALF OF ALL OTHERS SIMILARLY SITUATED,
PLAINTIFF,
-AGAINST-
XXXXX-XXXXXXX S.A.,
DEFENDANT.
================================================================================
MEMORANDUM OF LAW OF DEFENDANT XXXXX-XXXXXXX S.A.
IN SUPPORT OF ITS MOTION TO DISMISS THE COMPLAINT
================================================================================
SHEARMAN & STERLING
CITICORP CENTER
000 XXXX 00XX XXXXXX
XXX XXXX, XXX XXXX 00000
(000)000-0000
ATTORNEYS FOR DEFENDANT
XXXXX-XXXXXXX S.A.
OF COUNSEL:
XXXXXXX X. XXXXXX
XXXXXXX XXXXXX
XXXXXXXX X. XXXXXX
AUGUST 11, 1997
================================================================================
TABLE OF CONTENTS
TABLE OF AUTHORITIES........................................................ ii
PRELIMINARY STATEMENT....................................................... 1
STATEMENT OF FACTS.......................................................... 2
ARGUMENT.................................................................... 3
I. PLAINTIFF HAS FAILED TO EFFECT SERVICE ON DEFENDANT
XXXXX-XXXXXXX..................................................... 3
II. THIS COURT DOES NOT HAVE PERSONAL JURISDICTION OVER
XXXXX-XXXXXXX..................................................... 6
III. AS NO OFFER TO PURCHASE THE REMAINING SHARES HAS
BEEN MADE, AND INDEED MAY NOT BE MADE UNTIL THE
STANDSTILL AGREEMENT EXPIRES, THERE IS NO JUSTICIABLE
CASE OR CONTROVERSY BEFORE THIS COURT............................. 9
IV. THIS COURT SHOULD EXERCISE ITS DISCRETION UNDER THE
DOCTRINE OF FORUM NON CONVENIENS AND DISMISS THIS
ACTION AGAINST A FRENCH CORPORATION REGARDING
DECISIONS MADE AND ACTIONS TAKEN IN FRANCE........................ 10
A. The Alleged Transaction Out Of Which This Dispute Arose
Occurred In A Foreign Jurisdiction........................... 12
X. Xxxxxx On The New York Courts................................ 13
X. Xxxxxx On The Defendants..................................... 14
D. An Alternative Forum......................................... 16
E. The Residency of the Parties................................. 16
CONCLUSION.................................................................. 17
TABLE OF AUTHORITIES
Cases Page(s)
----- -------
Apple Records, Inc. v. Capitol Records, Inc., 137 A.D.2d 50,
--------------------------------------------
529 N.Y.S.2d 279 (1st Dep't 1988) ........................................7
Brooke Group Ltd. v. JCH Syndicate 488, 214 A.D.2d 486, 625 N.Y.S.2d
--------------------------------------
223 (1st Dep't 1995), aff'd, 87 N.Y.2d 530, 640 N.Y.S.2d 479 (1996) .....12
-----
Continental Ins. Co. v. Polaris Indus. Partners L.P. 199 A.D.2d 222,
----------------------------------------------------
606 N.Y.S.2d 164 (1st Dep't 1993) .......................................14
Xx Xxxxxx x. Xxxxxxx, 155 Misc. 2d 52, 587 N.Y.S.2d 495
--------------------
(Sup. Ct. N.Y. Co. 1992) ................................................13
Derso v. Volkswaeen of America, Inc., 159 A.D.2d 937,
-------------------------------------
552 N.Y.S.2d 1001 (4th Dep't 1990) .......................................5
Xxxxx Management, Inc. x. Xxxxx, 145 Misc. 2d 995.
--------------------------------
549 N.Y.S.2d 317 (Sup. Ct. N.Y. Co. 1989) ................................7
Xxxxxxxx v. Sapphire Petroleums Ltd., 000 X.X.X.0x 851
------------------------------------
(Sup. C. Kings Co. 1959) .................................................8
Heaps x. Xxxxx & Xxxxxxxx Co., 150 A.D.2d 164,
-----------------------------
540 N.Y.S.2d 437 (1st Dep't 1989) ................................ 11,14,15
Inspection Security and Law Enforcement Employees, District Council 82,
-------------------------------------------------
v. Xxxxxx, 64 N.Y.2d 233, 485 N.Y.S.2d 719 (1984) ........................9
---------
Irrigation & Indus, Dev. Corp. v. Indus S.A., 37 N.Y.2d 522,
--------------------------------------------
375 N.Y.S.2d 296 (1975) .................................................12
Islamic Republic of Iran x. Xxxxxxx, 62 N.Y.2d 474, 478 N.Y.S.2d 597
-----------------------------------
(1984), cert. denied, 469 U.S. 1108 (1985) .....................11,13,15,16
------------
In re: Jamaica Water Supply Co., 158 Misc. 2d 378. 600 N.Y.S.2d 914
-------------------------------
(Sup. Ct. Queens Co. 1993) ............................................9,10
Xxxxxx Xxxxxx & Sons v. Lehigh Coal & Navigation Co., 8 Misc. 2d 1005,
----------------------------------------------------
167 N.Y.S.2d 632 (Sup. Ct. N.Y. Co. 1957) ................................8
ii
Cases Page(s)
----- -------
Loeneard v. Santa Fe Indus..Inc., 70 N.Y.2d 262, 519 N.Y.S.2d 801 (1987)................................. 7
--------------------------------
Mollendo Equip. Co. v. Sekisan Trading Co., 56 A.D.2d 750, 392 N.Y.S.2d 427
------------------------------------------
(1st Dep't 1977), aff'd, 43 N.Y.2d 916, 403 N.Y.S.2d 729 (1978)..................................... 14
-----
Xxxxxx x. Xxxxxx. 191 A.D. 2d 372. 595 N.Y.S.2d 200
----------------
(1st Dep't 1993).................................................................................... 16
P.T. Delami Garrent Indus. x. Xxxxx di Risparmio di Torino. 164 Misc.
----------------------------------------------------------
2d 38. 623 N.Y.S.2d 476 (Sup. Ct. N.Y. Co. 1994).
aff'd sub nom. World Point Trading PTE. Ltd. v. Credito Italiano.
-------------- -------------------------------------------------
225 A.D. 26 153 (1st Dep't 1996).................................................................... 13
Piper Aircraft Co, x. Xxxxx. 454 U.S. 235 (1981)......................................................... 13,14
---------------------------
Xxxxxxx v. Ring, 9 Misc. 2d 44. 166 N.Y.S.2d 483
---------------
(Sup. Ct. N.Y. Co. 1957)............................................................................ 8
Silver v. Great Am. Ins. Co., 29 N.Y.2d 356. 328 N.Y.S.2d 398 (1972)..................................... 13,16
----------------------------
Tetra Finance (HK) Ltd. v. Patrv, 115 A.D.2d 408, 490 N.Y.S.2d 37
--------------------------------
(1st Dep't 1985).................................................................................... 12
Xxxxxxx x. Xxxx. Emba AB. 152 A.D.2d 389, 548 N.Y.S.2d 728
------------------------
(2d Dep't 1989)..................................................................................... 4
Zelouf v. Republic Nat'l Bank of New York, 225 A.D.2d 419, 640 N.Y.S.2d 15
-----------------------------------------
(1st Dept't 1996.................................................................................... 12
Statutes
--------
BCL (S) 307 (XxXxxxxx 1997).............................................................................. 3,4,5
CPLR (S) 302 (a)(2) (XxXxxxxx 1997)...................................................................... 6,8
CPLR (S) 302 (a)(3) (XxXxxxxx 1997)...................................................................... 6,8
CPLR (S) 311 (a)(1) (XxXxxxxx 1997)...................................................................... 5
CPLR (S) 327 (XxXxxxxx 1997)............................................................................. 1,10
CPLR (S) 327 (a) (XxXxxxxx 1997)......................................................................... 11
iii
STATUTES
--------
CPLR (S) 3211 (a)(2) (XxXxxxxx 1997).......................................1
CPLR (S) 3211 (a)(g) (XxXxxxxx 1997).......................................1
iv
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
---------------------------------------x
BRICKELL PARTNERS, a Florida :
Partnership, Individually On Its Own :
Behalf And On Behalf Of All Others :
Similarly Situated, :
: Index No. 603493/97
Plaintiff, :
:
- against - :
:
XXXXX-XXXXXXX S.A., :
:
Defendant. :
---------------------------------------x
MEMORANDUM OF LAW OF DEFENDANT
XXXXX-XXXXXXX S.A. IN SUPPORT OF
ITS MOTION TO DISMISS THE COMPLAINT
-----------------------------------
Defendant Xxxxx-Xxxxxxx S.A. ("Xxxxx-Xxxxxxx") respectfully submits
this memorandum of law in support of its motion, pursuant to N.Y. CIV. PRAC. L.
& R. ("CPLR") (S) 3211(a)(2), (8) and 327, to dismiss the complaint of Brickell
Partners (the "Complaint") (1) for lack of proper service on Xxxxx-Xxxxxxx; (2)
for lack of personal jurisdiction over Xxxxx-Xxxxxxx; (3) for lack of subject
matter jurisdiction under the ripeness doctrine; and (4) based upon the doctrine
of forum non conveniens.
PRELIMINARY STATEMENT
---------------------
This lawsuit does not belong in any court, much less one located in
the State of New York. Plaintiff, who hails from Florida, is suing Xxxxx-
Xxxxxxx, a French corporation, over an event which has not even occurred, and
indeed, according to the
2
allegations of the Complaint itself, cannot even occur until after a fixed date
in the future. The allegations of the Complaint demonstrate that the alleged
harm to plaintiff is nonexistent; so too is any conceivable nexus to New York.
Courts in this State, as in any other jurisdiction, have much more pressing
business than to be available to render advisory opinions in disputes having
absolutely no connection to this State. Perhaps plaintiff, in what it does not
allege in the Complaint, concedes this; along with its failure to articulate a
nonspeculative, justiciable cause of action against Xxxxx-Xxxxxxx, it was unable
either to effect proper service on or to establish a basis for personal
jurisdiction over Xxxxx-Xxxxxxx. As it is lacking in substance, fails to follow
proper procedure, and does not assert any conceivable basis for burdening the
Courts of this State, the Complaint should be dismissed.
STATEMENT OF FACTS/1/
------------------
Plaintiff is a Florida partnership that owns common stock of Xxxxx-
Xxxxxxx Xxxxx Inc. ("Xxxxx"). Complaint (P) 2. Xxxxx, a majority-owned
subsidiary of Xxxxx-Xxxxxxx, is a corporation duly organized and existing under
the laws of the Commonwealth of Pennsylvania, with its principal place of
business in Collegeville, Pennsylvania. Id. (P) 14. Defendant Xxxxx-Xxxxxxx is
---
a corporation duly organized and existing under the laws of France, with its
principal place of business in France. Id. (P) 3. Xxxxx-Xxxxxxx is engaged in
---
the research, development, production, marketing and sale of human and animal
pharmaceuticals, and is also involved in the chemical, fiber and polymer
businesses. Id.
---
____________________
/1/ Except where indicated, the facts set forth herein are taken from the
Complaint, and those facts are assumed to be true only for the purposes of this
motion.
3
Xxxxx-Xxxxxxx'x American depository receipts ("ADRs") are traded on the New York
Stock Exchange ("NYSE"). Id. Xxxxx-Xxxxxxx is the majority shareholder of
---
Xxxxx, with present ownership of approximately 68.3% of Xxxxx'x outstanding
stock. Id. Xxxxx'x stock is publicly traded on the NYSE. Id. (P) 14.
--- ---
On June 26, 1997, Xxxxx-Xxxxxxx stated that it was considering the
possibility of acquiring the remaining shares of Xxxxx by making an offer to
purchase these shares at $92.00 per share. Complaint (P) 15. Under the terms
of a "standstill agreement," in effect since 1990, Xxxxx-Xxxxxxx is prohibited
from acquiring any Xxxxx shares until July 31, 1997. Id.
---
ARGUMENT
--------
I. PLAINTIFF HAS FAILED TO EFFECT SERVICE ON DEFENDANT XXXXX-XXXXXXX
Xxxxx-Xxxxxxx is a foreign corporation not authorized to do business
in New York. Affidavit of Xxxxx X. Xxxxxx ("Xxxxxx Affidavit") (P)(P) 2, 5,
sworn to August 8, 1997. Section 307 of the Business Corporation Law (and the
Hague Convention on Service) governs the service of process on foreign
corporations who are subject to the general jurisdiction of the New York courts
but who are not authorized to do business in New York. BCL (S) 307 ("Section
307"). The provisions of Section 307 are not available if -- as Xxxxx-Xxxxxxx
so maintains -- New York lacks personal jurisdiction over the party being
served. See Point II infra. If, however, this Court determines that it has
--- -----
personal jurisdiction over
4
Xxxxx-Xxxxxxx, thereby bringing this action under the ambit of Section 307, it
is clear that plaintiff failed to effect proper service on Xxxxx-Xxxxxxx.
The procedures to effect service under Section 307 involve several
steps. First, plaintiff must serve a copy of the summons and complaint on the
Secretary of State by personally delivering to him or his deputy a copy of the
process together with a statutory filing fee. Second, plaintiff must serve
notice of the service and a copy of the process on the foreign corporation by
either: i) delivering notice and a copy of the process personally to Xxxxx-
Xxxxxxx in France and in accordance with the French laws covering the service of
process; or ii) mailing notice and a copy of the process to Xxxxx-Xxxxxxx by
registered mail with return receipt requested at the post office address
specified for the purpose of mailing process./2/ Finally, plaintiff must file an
affidavit of compliance and a copy of the process with the clerk of the court
within thirty (30) days after the personal service or the receipt of the return
receipt (or other official proof of delivery) if the service was made by mail.
Service of process shall be complete ten (10) days after the affidavit of
compliance and the process are filed with the clerk of the court. BCL (S) 307
(XxXxxxxx 1997).
Plaintiff failed to complete any of the above service requirements,
and instead attempted only to serve Xxxxx-Xxxxxxx Inc., an indirect subsidiary
of Xxxxx-Xxxxxxx with its principal place of business in Cranbury, New Jersey.
Schwab Affidavit (P) 12. Even
___________________
/2/ It should be noted that if Section 307 applies, plaintiff is required to
comply with the terms of the Hague Convention on Service when serving Xxxxx-
Xxxxxxx with copies of notice and process in France. Xxxxxxx x. Xxxx Emba AB,
-----------------------
152 A.D. 2d 389, 395, 548 N.Y.S.2d 728, 731 n.4 (2d Dep't 1989).
5
disregarding plaintiff's failure to follow Section 307's requirements for
service on a foreign corporation, service on Xxxxx-Xxxxxxx Inc. cannot effect
service on defendant Xxxxx-Xxxxxxx. The CPLR allows for service upon a domestic
or foreign corporation -- although unlike Xxxxx-Xxxxxxx, only one authorized to
business in New York -- to be made through personal delivery of the summons upon
"an officer, director, managing or general agent, or cashier or assistant
cashier or to any other agent authorized by appointment or by law to receive
service." CPLR (S) 311(a)(1).
Thus, under the CPLR, service of process on a subsidiary does not
constitute adequate service on a foreign parent corporation unless the
subsidiary is an agent of the parent. A subsidiary is an agent for purposes of
service only when it "is so dominated by its parent corporation that it is
acting as a `mere department' of the parent." Derso v. Volkswagen of America,
-------------------------------
Inc., 159 A.D.2d 937, 937, 552 N.Y.S. 2d 1001, 1002 ( 4th Dep't 1990) (quoting
----
Low v. Bayerische Motoren Werke, AG, 88 A.D.2d 504, 506, 449 N.Y.S.2d 733 (1st
-----------------------------------
Dep't 1982)). Xxxxx-Xxxxxxx Inc. is not a "mere department" of Xxxxx-Xxxxxxx
S.A., as the two corporations observe all corporate formalities, have separate
boards of directors and maintain their own bank accounts, accounting and payroll
systems, financial records and budgets. See Schwab Affidavit (P)(P) 13, 14, 15.
---
Most importantly, Xxxxx-Xxxxxxx does not exercise any control over RPI's day-to-
day operations. Id. (P) 18. As Xxxxx-Xxxxxxx Inc. is not an agent of its
---
parent Xxxxx-Xxxxxxx, this Court should dismiss the Complaint for lack of proper
service.
6
II. THIS COURT DOES NOT HAVE PERSONAL JURISDICTION OVER XXXXX-XXXXXXX
Because Xxxxx-Xxxxxxx is a foreign corporation, it is subject to the
personal jurisdiction of a New York court only through application of CPLR (S)
302, New York's "long-arm" statute, which establishes various bases of personal
jurisdiction over nondomiciliaries by virtue of their acts. Seemingly
attempting to apply the long-arm statute, plaintiff bases this Court's
jurisdiction over nonresident Xxxxx-Xxxxxxx on its contention that "[a]t all
relevant times, Xxxxx-Xxxxxxx did or performed acts within or without the State
that subject it to the jurisdiction of the Courts of the State of New York."
Complaint (P) 6. With the noteworthy omission of the word "tortious," this
allegation tracks the language of CPLR (S) 302(a)(2) and (3). CPLR (S)
302(a)(2) and (3) provide, in pertinent part, that a non-domiciliary is subject
to the jurisdiction of New York if it:
(a)(2): "commits a tortious act within the state. . . "
(a)(3): "commits a tortious act without the state causing injury to person
or property within the state. . . .if he
(i) regularly does or solicits business, or engages in any other
persistent course of conduct, or derives substantial revenue from
goods used or consumed or services rendered, in the state, or (ii)
expects or should reasonably expect the act to have consequences in
the state and derives substantial revenue from interstate or
international commerce."
CPLR (S) 302(a)(2)-(3) (XxXxxxxx 1997).
Plaintiff's reliance on either of these bases of personal jurisdiction
is both strikingly, and fatally, flawed. The statute on its face applies only
to tort claims, and plaintiffs did not -- and indeed cannot -- plead the
performance of a "tortious act."
7
Plaintiff's claims are "breach of fiduciary and other common law duties,"
Complaint (P) 23, causes of action which New York courts have refused to treat
as tort claims. See Loengard v. Santa Fe Indus., Inc., 70 N.Y.2d 262, 519
--- ---------------------------------
N.Y.S.2d 801 (1987) (holding that the six-year contract statute of limitations,
rather than the three-year tort statute of limitations, applied to an action
based on a claim of unjust enrichment resulting from a breach of fiduciary
duty); Xxxxx Management, Inc. x. Xxxxx, 145 Misc. 2d 995, 549 N.Y.S.2d 317 (Sup.
-------------------------------
Ct. N.Y. Co. 1989) (applying the contract statute of limitations to a claim for
breach of fiduciary obligation where damages were sought).
Loengard v. Santa Fe Indus., Inc., 70 N.Y.2d 262, 519 N.Y.S.2d 801
---------------------------------
(1987), is particularly instructive, as it involves virtually identical facts.
In Loengard, minority shareholders brought an action against majority
--------
fiduciaries to recover damages resulting from an alleged underpayment for their
shares following a "freeze-out" merger. Id. at 264, 802. The Loengard
--- --------
plaintiffs' claims, as in this case, were based on alleged breaches of fiduciary
duty. Id. Holding that a claim based on a breach of fiduciary duty is
---
"essentially equitable in nature," the Court of Appeals concluded that such a
claim was governed by the six-year contract statute of limitations. Id. at 266-
---
67, 803-04. While a breach of fiduciary duty claim may, in some circumstances,
be actionable in tort, see Apple Records, Inc. v. Capitol Records, Inc., 137
--- --------------------------------------------
A.D.2d 50, 529 N.Y.S.2d 279 (1st Dep't 1988), the proper "focus is on whether a
noncontractual duty was violated; a duty imposed on individuals as a matter of
social policy, as opposed to those imposed consensually as a matter of
contractual agreement." Id. at 55, 282. Here, however, as in Loengard, no such
--- --------
noncontractual duty
8
exists. Plaintiff's claim regarding Xxxxx-Xxxxxxx'x alleged breach of its
fiduciary duties to Xxxxx'x shareholders does not sound in tort, and thus the
CPLR's "tortious act" long-arm provisions do not apply to subject Xxxxx-Xxxxxxx
to personal jurisdiction in New York.
Moreover, even if this Court were to determine that plaintiff's claims
are actionable in tort, and that the acts complained of did not occur within the
State of New York, plaintiff fails to plead the New York contacts required by
CPLR (S) 302(a)(3), which include: regularly doing business or engaging in
conduct in New York, deriving substantial revenue from, or expecting the act to
have consequences in, New York. As detailed in the Schwab Affidavit, Xxxxx-
Xxxxxxx is not registered or licensed to do business in New York and is not
required to pay any taxes in New York. Id. (P)(P) 5, 8. Xxxxx-Xxxxxxx also
---
does not contract to supply any goods in New York nor does it market or
advertise goods in New York. Id. (P)(P) 9, 10. In short, Xxxxx-Xxxxxxx has no
---
connection to New York.
Plaintiff further alleges that venue properly lies in New York because
Xxxxx-Xxxxxxx'x ADRs are listed and traded on the NYSE. Complaint (P) 5. This
allegation should not suffice to establish venue, and it similarly does not
establish jurisdiction. It is long settled in this State that trading of a
foreign corporation's stock on a stock exchange in New York does not create
jurisdiction over the corporation. Xxxxxx Xxxxxx & Sons v. Lehigh Coal &
-------------------------------------
Navigation Co., 8 Misc. 2d 1005, 1006-07, 167 N.Y.S.2d 632, 632-34 (Sup. Ct.
--------------
N.Y. Co. 1957); Xxxxxxx v. Ring, 9 Misc. 2d 44, 45-46, 166 N.Y.S.2d 483, 484-85
---------------
(Sup. Ct. N.Y. Co. 1957); see also Xxxxxxxx v. Sapphire Petroleums Ltd., 195
-------- ------------------------------------
N.Y.S. 2d 851,
9
853 (Sup. Ct. Kings Co. 1959). Thus, this Court should dismiss the Complaint
for lack of personal jurisdiction over Xxxxx-Xxxxxxx.
III. AS NO OFFER TO PURCHASE THE REMAINING SHARES HAS BEEN MADE, AND INDEED MAY
NOT BE MADE UNTIL THE STANDSTILL AGREEMENT EXPIRES, THERE IS NO JUSTICIABLE
CASE OR CONTROVERSY BEFORE THIS COURT
Under the ripeness doctrine, it is axiomatic that courts are to decide
cases and controversies, and refrain from rendering "advisory opinions." See,
---
e.g., New York State Inspection, Sec. and Law Enforcement Employees x. Xxxxx, 64
---- ---------------------------------------------------------------------
N.Y.2d 233, 241, 485 N.Y.S.2d 719, 723 n.2 (1984) (holding that, as the ripeness
doctrine barred consideration of the matter brought, "any further consideration
would require this court to tender an advisory opinion, a practice not in accord
with the settled policy in this State"). "Where the harm sought to be enjoined
is contingent upon events which may not come to pass, the claim to enjoin the
purported hazard is nonjusticiable as wholly speculative and abstract." Id. at
---
723. As "nonjusticiability implicates the subject matter jurisdiction of the
Court, the petition must be dismissed." In re Jamaica Water Supply Co., 158
------------------------------
Misc. 2d 378, 396, 600 N.Y.S.2d 914, 927 (Sup. Ct. Queens Co. 1993).
It is precisely this kind of speculative harm that plaintiff seeks to
enjoin in this case. By plaintiff's own admission, Xxxxx-Xxxxxxx has merely
announced that it was "considering an offer" to purchase Xxxxx'x stock.
Complaint (P) 15. As such, the allegations of the Complaint are based on an
uncertain future event that may or may not occur. Indeed, plaintiff concedes
the uncertain nature of its claim by its references to "the proposed
transaction" and the "planned overhaul." Id. (P)(P) 15, 16. Moreover, as
---
plaintiff further
10
concedes, Xxxxx-Xxxxxxx currently is prohibited, by virtue of the standstill
agreement, from taking any action to acquire Xxxxx'x shares until July 31, 1997.
Id. (P) 17. Thus, not only does plaintiff plead that the allegedly injurious
---
event has not yet happened, it goes on to admit that any possibility of the
"offer" taking place may only happen some time in the future, if at all.
Any consideration by this Court of claims stemming from such a
concededly contingent event necessarily should be barred by the ripeness
doctrine. Accordingly, as the Complaint "does not present a justiciable
question in that it calls for an advisory opinion, presents a question which is
not ripe for judicial review, and presents a question which is contingent," In
--
re Jamaica Water Supply Co., 158 Misc. 2d at 396, 600 N.Y.S. 2d at 927, this
---------------------------
Court should dismiss plaintiff's Complaint.
IV. THIS COURT SHOULD EXERCISE ITS DISCRETION UNDER THE DOCTRINE OF FORUM
NON CONVENIENS AND DISMISS THIS ACTION AGAINST A FRENCH CORPORATION
REGARDING DECISIONS MADE AND ACTIONS TAKEN IN FRANCE
Even if this Court were to find that plaintiff has alleged a
justiciable controversy and that Xxxxx-Xxxxxxx is subject to the jurisdiction of
the New York courts, this Court should decline to exercise its jurisdiction over
this case. As is evident from a review of the Complaint, this case simply has
no connection to New York.
The principle that New York courts should not accept jurisdiction over
actions that have no connection with this State is codified in CPLR 327, which
provides that "[w]hen the court finds that in the interest of substantial
justice the action should be heard in another
11
forum, the court, on the motion of any party, may stay or dismiss the action in
whole or in part on any conditions that may be just." CPLR 327(a) (XxXxxxxx
1997). Under the doctrine of forum non conveniens, a court may dismiss an
action where it determines that, although jurisdictionally sound, the action
would be better adjudicated elsewhere. Islamic Republic of Iran x. Xxxxxxx, 62
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N.Y.2d 474, 478-79, 478 N.Y.S.2d 597, 599 (1984), cert. denied, 469 U.S. 1108
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(1985). The Court should consider the following factors in determining whether
to dismiss an action on forum non conveniens grounds: (1) the fact that the
transaction out of which the cause of action arose occurred primarily in a
foreign jurisdiction; (2) the potential hardship to the defendant; (3) the
unavailability of an alternative forum; (4) the residency of the parties; and
(5) the burden on the New York courts. Id. at 479, 600. No one factor is
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determinative and this Court acts within its discretion when it considers and
applies the relevant factors. Id. at 479, 600.
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In deciding a motion based on forum non conveniens, the "overall focus
must relate to the question or whether New York is an inconvenient forum and
whether another forum is available which will best serve the ends of justice
and the convenience of the parties.'" Heaps x. Xxxxx & Xxxxxxxx Co., 150 A.D.2d
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164, 165, 540 N.Y.S.2d 437, 438 (1st Dep't 1989) (quoting Irrigation & Indus.
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Dev. Corp. v. Indag, S.A., 37 N.Y.2d 522, 525, 375 N.Y.S.2d 296, 299
-------------------------
(1975)(quoting Silver v. Great Am. Ins. Co., 29 N.Y.2d 356, 361, 328 N.Y.S.2d
----------------------------
398, 402 (1972)). Because there is absolutely no connection between this
lawsuit and the state of New York, all factors point to dismissal.
