Best Aviation Limited v. Ronni Chowdry et al, No. 2:2012cv05853 - Document 33 (C.D. Cal. 2012)

Court Description: ORDER GRANTING DEFENDANTS MOTIONS TO DISMISS 22 by Judge Otis D Wright, II ( MD JS-6. Case Terminated ) (lc) .Modified on 11/8/2012 (lc).

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Best Aviation Limited v. Ronni Chowdry et al Doc. 33 1 O 2 JS-6 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 BEST AVIATION LTD., 13 14 15 v. Case No. 2:12-cv-05852-ODW(VBKx) [18] Case No. 2:12-cv-05853-ODW(VBKx) [22] Plaintiff, RONNI CHOWDRY; and ATLAS AVIATION, LLC, Defendants. 16 I. 17 ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS INTRODUCTION 18 Plaintiff Best Aviation brings this action against Ronni Chowdry and Atlas 19 20 21 22 23 24 25 Aviation LLC for: (1) breach of contract; (2) money had and received; (3) conversion; (4) intentional misrepresentation; (5) negligent misrepresentation; (6) concealment; (7) violation of California Business and Professional Code section 17200; (8) breach of fiduciary duty; and (9) declaratory relief. Defendants now move to dismiss Best Aviation’s Complaints. For the reasons discussed below, Defendants’ motions are GRANTED. 1 26 27 28 1 After carefully considering the papers filed in support of and in opposition to the instant motions, the Court deems the matters appropriate for decision without oral argument. Fed. R. Civ. P. 78; C.D. Cal. R. 7-15. Dockets.Justia.com II. 1 2 A. FACTUAL BACKGROUND ALLEGATIONS RELATED TO CASE NO. 2:12-CV-05852 (AIRCRAFT LEASE) 3 In December 2010, a Best Aviation representative traveled to Los Angeles, 4 California to meet with Chowdry, a citizen of Bangladesh, to negotiate an aircraft 5 lease for a set of airplanes located in China. (Compl. ¶ 12.); (Mot. 11.) After 6 agreeing to terms, Best Aviation, a corporation of Bangladesh, signed a letter of intent 7 with Chowdry. (Compl. ¶¶ 3, 12.) 8 In February 2011, Chowdry sent documents to Best Aviation related to a 9 different set of airplanes located in Spain. (Compl. ¶ 13. ) After inspecting the 10 planes, Best Aviation concluded the Spanish aircrafts would be an acceptable 11 substitute. 12 subsequently rescinded. (Compl. ¶ 29.) (Id.) The first lease agreement for the planes located in China was 13 As a condition of a new lease for the Spanish planes, Chowdry demanded a 14 bank guarantee and Best Aviation offered to provide $2,500,000 in advanced 15 payments instead. (Compl. ¶ 13.) Once Chowdry signed a letter of intent to purchase 16 the Spanish aircraft from a third party, Best Aviation and Atlas allegedly created a 17 new agreement. 2 (Id.) Best Aviation alleges it made a $2,500,000 advanced payment 18 to Atlas in accordance with the newly developed agreement. (Compl. ¶14.) 19 In May 2011, Defendants informed Best Aviation that financing had been 20 arranged for the airplanes through Laserline Lease Finance Corporation (“Laserline”) 21 and their representative, Mark Eddington, a citizen of the United States. (Compl. ¶ 22 15.); (Opp’n 3, 7.) Best Aviation, Laserline, and Chowdry restructured the lease to 23 include Chowdry as a broker to a lease agreement between Laserline and Best 24 Aviation. (Compl. ¶ 15.) Atlas then transferred $1,500,000 of the funds received 25 from Best Aviation under the original agreement, to Laserline. (Id.) Best Aviation 26 alleges the remaining balance was never returned. (Id.) 27 28 2 Best Aviation fails to supply the Court with evidence of an enforceable agreement between Defendants and Best Aviation. 2 1 B. FACTS RELATED TO CASE NO. 2:12-CV-05853 (GROUND SUPPORT) 2 In November 2011, Best Aviation’s CEO Ricky Frick allegedly entered into an 3 agreement with Atlas for ground support equipment in exchange for $1,114,870. 3 4 (Compl. ¶ 9.) In accordance with the alleged agreement, Best Aviation provided Atlas 5 with a $670,000 deposit. (Compl. ¶ 10.) Atlas was to send the ground support 6 equipment in three separate shipments scheduled to commence in November 2011 7 with each subsequent shipment made fifteen days after the last. (Compl. ¶ 11.) 8 In December 2011, Best Aviation had yet to receive a shipment and contacted 9 Chowdry regarding the timing of the shipments and their deposit. (Id.) Chowdry 10 represented that the deposit was safe and all shipments were to be made as required. 11 (Id.) The first shipment was sent on December 29, 2011. (Compl. ¶ 12.) After 12 learning the first shipment was on its way, Best Aviation released $301,270 to Atlas 13 through their line of credit. (Id.) Best Aviation alleges Defendants failed to properly 14 document the shipment resulting in Best Aviation’s inability to access the equipment 15 once it arrived in Bangladesh. (Id.) The second and third shipments were never sent. 16 (Id.) 17 Best Aviation repeatedly inquired about the second and third shipments and if 18 Atlas would remedy the issue created by the alleged improper documentation. 19 (Compl. ¶ 13.) In response, Chowdry represented he was attempting to resolve the 20 issues. (Id.) On April 10, 2012, Best Aviation informed Chowdry their alleged 21 agreement was canceled for non-performance. (Id.) Best Aviation requests the deposit 22 of $670,000 be returned less $18,000.60 for shipping costs. (Id.) III. 23 LEGAL STANDARD 24 Dismissal under Rule 12(b)(6) can be based on “the lack of a cognizable legal 25 theory” or “the absence of sufficient facts alleged under a cognizable legal theory.” 26 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). A complaint 27 28 3 Best Aviation failed to provide the Court with evidence—other than an invoice—showing an enforceable agreement existed. 3 1 need only satisfy the minimal notice pleading requirements of Rule 8(a)(2)—a short 2 and plain statement—to survive a motion to dismiss for failure to state a claim under 3 Rule 12(b)(6). Porter v. Jones, 319 F.3d 483, 494 (9th Cir. 2003); Fed. R. Civ. P. 4 8(a)(2). For a complaint to sufficiently state a claim, its “[f]actual allegations must be 5 enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. 6 Twombly, 550 U.S. 544, 555 (2007). While specific facts are not necessary so long as 7 the complaint gives the defendant fair notice of the claim and the grounds upon which 8 the claim rests, a complaint must nevertheless “contain sufficient factual matter, 9 accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. 10 Iqbal, 556 U.S. 662, 678 (2009). 11 Iqbal’s plausibility standard “asks for more than a sheer possibility that a 12 defendant has acted unlawfully,” but does not go so far as to impose a “probability 13 requirement.” Id. Rule 8 demands more than a complaint that is merely consistent 14 with a defendant’s liability—labels and conclusions, or formulaic recitals of the 15 elements of a cause of action do not suffice. Id. Instead, the complaint must allege 16 sufficient underlying facts to provide fair notice and enable the defendant to defend 17 itself effectively. 18 determination whether a complaint satisfies the plausibility standard is a “context- 19 specific task that requires the reviewing court to draw on its judicial experience and 20 common sense.” Iqbal, 566 U.S. at 679. Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011). The 21 When considering a Rule 12(b)(6) motion, a court is generally limited to the 22 pleadings and must construe “[a]ll factual allegations set forth in the complaint . . . as 23 true and . . . in the light most favorable to [the plaintiff].” Lee v. City of L.A., 250 F.3d 24 668, 688 (9th Cir. 2001). Conclusory allegations, unwarranted deductions of fact, and 25 unreasonable inferences need not be blindly accepted as true by the court. Sprewell v. 26 Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). Yet, a complaint should be 27 dismissed only if “it appears beyond doubt that the plaintiff can prove no set of facts” 28 4 1 supporting plaintiff’s claim for relief. Morley v. Walker, 175 F.3d 756, 759 (9th Cir. 2 1999). 3 As a general rule, leave to amend a complaint that has been dismissed should be 4 freely granted. Fed. R. Civ. P. 15(a). However, leave to amend may be denied when 5 “the court determines that the allegation of other facts consistent with the challenged 6 pleading could not possibly cure the deficiency.” Schreiber Distrib. Co. v. Serv-Well 7 Furniture Co., 806 F.2d 1393, 1401 (9th Cir.1986); see Lopez v. Smith, 203 F.3d 8 1122, 1127 (9th Cir. 2000). IV. 9 DISCUSSION 10 Defendants move to dismiss Best Aviation’s Complaint for: (1) lack of 11 standing; (2) forum non conveniens; (3) failure to allege personal liability; (4) 12 violating the group pleading rule; and (5) insufficient pleading. The Court addresses 13 each argument in turn. 14 A. STANDING Defendants argue that Best Aviation is not a corporation in good standing and 15 16 therefore lacks standing to bring suit in California. 4 17 challenge to the Court’s subject matter jurisdiction and may be raised at any time. 18 United States v. Viltrakis, 108 F.3d 1159, 1160 (9th Cir. 1997). 19 corporation’s capacity to sue is determined “by the law under which it was 20 organized.” Fed. R. Civ. Proc. 17(b)(2). Best Aviation alleges it is a corporate entity 21 doing business in Bangladesh. 22 documents that appear to be valid licenses for operation in Bangladesh. (Frick Decl. 23 Ex. 1–2.) Because Best Aviation demonstrates it is a corporation in good standing in 24 Bangladesh, the Court finds Best Aviation has the capacity to sue. (Id.) 25 B. (Mot. 5–8.) Standing is a A foreign Best Aviation provides a number of qualifying FORUM NON CONVENIENS 26 Forum non conveniens is an “exceptional tool” to be used “sparingly”. Dole 27 Food Co. v. Watts, 303 F.3d 1104, 1118 (9th Cir. 2002) (quoting Ravelo Monegro v. 28 4 For simplicity, the Court cites only to the record in Case No. 12-cv-05852 unless otherwise noted. 5 1 Rosa, 211 F.3d 509, 514 (9th Cir. 2000)). In order to grant dismissal on the grounds 2 of forum non conveniens, the movant must show: (1) the existence of an adequate 3 alternative forum, and (2) that the balance of private and public interest factors favors 4 dismissal. Bos. Telecomms. Grp., Inc., v. Wood, 588 F.3d 1201, 1206 (9th Cir. 2009). 5 The burden lies with the defendant to prove an adequate alternative forum exists. 6 Cheng v. Boeing Co., 708 F.2d 1406, 1411 (9th Cir. 1983). Finally, before dismissing 7 for forum non conveniens, courts are at times required to undertake a choice of law 8 determination. Lueck v. Sandstrand Corp., 236 F.3d 1137, 1148 (9th Cir. 2001). 9 1. Choice of Law 10 When considering a dismissal, the choice of law analysis is determinative only 11 “when the case involves a United States statute requiring venue in the United States.” 12 Id. Accordingly, “the choice of law determination is given much less deference on a 13 forum non conveniens inquiry.” Id. The Court finds no applicable statute requires 14 venue in the United States. 15 Best Aviation posits California law should govern the action because the letter 16 of intent identifies California as the appropriate forum to settle disputes. (Opp’n 10– 17 11.) But, the Court does not find an enforceable contract between the parties. 18 Best Aviation refers to various letters of intent, but none of the exhibits contain 19 an enforceable agreement signed by Chowdry or any Best Aviation representative. 20 The only document bearing Chowdry’s signature is a rescinded letter of intent related 21 to the first set of aircraft located in China. (Compl. ¶ 29 (stating the agreement was 22 rescinded).); (Compl. Ex. 2.) Conclusory allegations, unwarranted deductions of fact, 23 and unreasonable inferences need not be blindly accepted as true by the court. 24 Sprewell, 266 F.3d at 988. 25 A contract for the sale of goods exceeding $500 is “not enforceable” without a 26 writing “signed by the party against whom enforcement is sought . . . .” Cal. Com. 27 Code § 2201. Since there is no writing signed by Chowdry or Atlas evidencing a 28 contract, the Court finds it unreasonable to infer the existence of an enforceable 6 1 contract. Without a valid choice of law clause or a valid contract, the action hardly 2 requires venue within the United States or application of California law. 3 Best Aviation also fails to establish a valid contract governing the ground 4 support equipment. 5 The Complaint alleges an agreement between Best Aviation and 5 Atlas, but the only document evidencing the agreement is an invoice. (Compl. Ex. 1.) 6 Because Best Aviation fails to establish the terms of the so-called agreement, the 7 Court fails to find any term showing that California law governs the action. 8 2. Adequate alternative forum 9 The existence of an adequate alternative forum depends on whether the 10 alternative forum is “so clearly inadequate or unsatisfactory that it is no remedy at 11 all.” Leetsch v. Freedman, 260 F.3d 1100, 1103 (9th Cir. 2001) (quoting Creative 12 Tech. Ltd. v. Aztech Sys. Pte., Ltd., 61 F.3d 696, 701 (9th Cir. 1995)). 13 requirement is generally met if the defendant is amenable to service of process in the 14 alternative forum. Leetsch, 260 F.3d at 1103. “Amenability to service of process, 15 however, is not the only determinant of a forum’s adequacy.” Id. Jurisdiction of the 16 foreign court and competency to decide the legal questions involved are also 17 considered. Courts hold that “the amenability issue may be resolved by inquiring 18 whether the [Bangladeshi] court system has the jurisdiction and competence” to 19 resolve the dispute. Leetsch, 260 F.3d at 1103 (citing Cheng, 780 F.2d at 1410–11). This Defendants argue that Bangladesh is an adequate alternative forum in which to 20 21 conduct litigation. (Mot. 8–10.) Defendants direct this Court’s attention to 22 Bangladeshi statutes allowing a plaintiff to bring the same causes of action alleged 23 here. (Id.) Defendants also offer expert testimony showing all the causes of action 24 Best Aviation asserts have analogues in Bangladesh and that the civil court system in 25 Bangladesh is “analogous to the impartial judiciary” present in the United States. 26 (Hossain Decl. ¶¶ 16–17.) 27 corporation and its principal may be sued in Bangladesh. (Id. ¶ 6.) Based on the Defendants’ expert also submits that a United States 28 5 This paragraph discusses and cites to the record in Case No. 12-cv-05853. 7 1 expert’s declaration and exhibits, the Court finds that Bangladeshi courts have both 2 the jurisdiction and competency to decide the claims at issue. 3 Best Aviation provides no expert testimony to the contrary. Instead, Best 4 Aviation argues because Atlas is a Washington, D.C. limited liability corporation the 5 Court is “prohibit[ed] from dismissing this action.” (Opp’n 6.) But this argument 6 does not withstand scrutiny because Defendants indicate a willingness to submit to 7 jurisdiction in Bangladesh. (See Reply 2–3) When a defendant willingly submits to 8 jurisdiction in a foreign forum, a court may grant a forum non conveniens dismissal. 9 See Van Schijndel v. Boeing Co., 434 F. Supp. 2d 766, 755 (C.D. Cal. 2006). Thus, 10 the Court is not prohibited from dismissing the action. 11 Best Aviation offers no other arguments tending to show that Bangladesh is an 12 inadequate forum. (Opp’n 6–7.) Accordingly, the Court finds that Defendants have 13 demonstrated an adequate alternative forum. 14 3. 15 When balancing the private interest factors the Court considers: 16 (1) The residence of the parties and the witnesses; (2) the forum’s convenience to the litigants; (3) access to physical evidence and other sources of proof; (4) whether unwilling witnesses can be compelled to testify; (5) the cost of bringing witnesses to trial; (6) the enforceability of the judgment; and (7) all other practical problems that make trial of a case easy, expeditious and inexpensive. 17 18 19 20 Private interest factors Lueck, 236 F.3d at 1145. The Court examines each factor in turn. 21 First, the Court considers the residence of the parties and witnesses. Best 22 Aviation and its employees are citizens of Bangladesh and Atlas is a District of 23 Columbia limited liability corporation authorized to do business in California. 24 (Compl. ¶¶ 3, 5.) One third party witness, Mr. Eddington, is a resident of California. 25 (Opp’n 7.) Defendants identify several additional witnesses residing in Bangladesh, 26 including the Chairman of Best Aviation and other corporate officers. (Mot. 10.) The 27 Ninth Circuit instructs “a court should evaluate ‘the materiality and importance of the 28 anticipated [evidence and] witnesses’ testimony and then determine[ ] their 8 1 accessibility and convenience to the forum.’” Lueck, 236 F.3d at 1146 (quoting Gates 2 Learjet Corp. v. Jensen, 743 F.2d 1325, 1335–36 (9th Cir. 1984)). Here, the majority 3 of witnesses are located in Bangladesh. Litigating the dispute in Bangladesh—where 4 these important and material witnesses are located—ensures that they will be 5 accessible for trial. This factor thus favors dismissal. 6 Next, the Court evaluates the forum’s convenience to the litigants. Defendants 7 argue that some witnesses may not be available for trial because they are unable to 8 leave Bangladesh. (Mot. 11.) Litigating in Bangladesh puts this concern to rest. Best 9 Aviation and its employees, excepting Frick, are located in Bangladesh. Further, 10 resolving a dispute in your home forum is hardly inconvenient. Defendants also 11 indicate a willingness to submit to jurisdiction in Bangladesh, impliedly conceding 12 that the alternative forum is convenient. This factor likewise favors dismissal. 13 Third, the Court weighs the parties’ access to physical evidence and other 14 sources of proof. The documents and records pertinent to the suit are presumably 15 located at the respective offices of Atlas and Best Aviation. The airplanes and ground 16 support equipment both appear to be located overseas. 17 transported with ease, the planes are overseas, and the ground support equipment is 18 located in Bangladesh, the Court finds this factor favors dismissal. As documents can be 19 Fourth, the Court assesses whether unwilling witnesses can be compelled to 20 testify. Defendants’ contend that some witnesses may be unavailable for trial if the 21 suit progresses here. (Mot. 11.) Best Aviation maintains it has the ability to produce 22 pertinent witnesses if trial proceeds here. This factor weighs in favor of denying the 23 dismissal. 24 majority of the witnesses reside in Bangladesh and would need to be deposed or 25 appear at trial. If the suit resolves in Bangladesh, the cost of bringing witnesses to 26 trial would be greatly reduced because numerous international flights would not be 27 required. This factor favors dismissal. Fifth, the Court considers the cost of bringing witnesses to trial. 28 9 A Sixth, the Court weighs the enforceability of the judgment. 1 Defendants 2 correctly identify the Uniform Foreign Money-Judgments Recognition Act, which 3 gives foreign country judgments enforceability in California. Cal. Civ. Proc. Code 4 § 1719 (2008). Under this act, a judgment rendered by a Bangladesh court would be 5 enforceable in California. This factor also supports dismissal. 6 Finally, the Court examines all other practical problems that make trial of a case 7 easy, expeditious, and inexpensive. Best Aviation argues that Atlas is not subject to 8 jurisdiction in Bangladesh, but Chowdry, as a citizen of Bangladesh, is. (Opp’n 8.) 9 Best Aviation concludes that a forum non conveniens dismissal would result in two 10 trials. Id. Best Aviation’s contention is erroneous and unsupported because a 11 dismissal for forum non conveniens would end the dispute here. 12 undisputed evidence suggests Bangladeshi courts have jurisdiction over both Chowdry 13 and Atlas, who so consented. (Reply at 2; Hossain Decl. ¶ 6.) Defendants submit that 14 many witnesses are unable to leave Bangladesh because they are under indictment or 15 on bail. (Mot. 11.) Best Aviation does not dispute this claim. Instead, Best Aviation 16 maintains the witnesses are under party control but that Best Aviation “can produce 17 the individuals if need be.” (Opp’n 7.) In order to ensure these witnesses will be 18 available, the Court is inclined to dismiss the action. For the reasons discussed above, 19 the balance of private interest factors favors dismissal. Further, the 20 4. Public interest factors 21 The public interest factors are: (1) the local interest in the lawsuit; (2) the 22 court’s familiarity with governing law; (3) the burden on local courts and juries; (4) 23 congestion in the court; and (5) the costs of resolving a dispute unrelated to a 24 particular forum. Lueck, 236 F.3d at 1147. The court evaluates each in turn. 25 First, California courts, jurors and citizens have little interest in the claims of a 26 Bangladeshi corporation against a limited liability corporation based in Washington, 27 D.C. 28 executed in California (Compl. ¶ 12), but the Court finds that no enforceable Best Aviation contends that the agreement with Atlas was negotiated and 10 1 agreement exists. Without an agreement negotiated and executed in California, there 2 is little, if any, local interest in this lawsuit. 3 Second, while there is no evidence Bangladeshi courts are familiar with 4 California law; California law may not even apply. Regardless, Defendants provide 5 Bangladeshi analogues for each of the nine causes of action showing that whichever 6 law is applied—Bangladesh or California—a court in Bangladesh would be able to 7 navigate the lawsuit effectively. Burdening the Court and California jurors with a suit 8 unrelated to California also favors dismissal. Fourth, Best Aviation’s contention that 9 high population density renders Bangladeshi courts overly congested is unavailing. 10 (Opp’n 9.) Population density does not necessarily equate to court congestion. And 11 finally, resolving the dispute here causes the Court to expend valuable resources 12 hearing a case completely unrelated to California. In sum, the balance of the public 13 interest factors favors dismissal. V. 14 CONCLUSION 15 For the reasons discussed above, Bangladesh is an adequate alternative forum 16 and the balance of private and public interest factors favors dismissal. Accordingly, 17 the Court GRANTS Defendants’ motions to dismiss for forum non conveniens. 18 19 IT IS SO ORDERED. 20 21 November 7, 2012 22 23 24 ____________________________________ OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE 25 26 27 28 11

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