Global Commodities Trading Group, Inc. v. Beneficio De Arroz Choloma, S.A., No. 18-16026 (9th Cir. 2020)
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Global filed suit against Bachosa in district court after Bachosa fell behind on its payments on two contracts. The district court dismissed Global's claims for lack of personal jurisdiction and denied as moot Bachosa's motion to dismiss for forum non conveniens.
The Ninth Circuit held that the district court had personal jurisdiction over both the corporate and individual defendants and that litigation in the Eastern District of California would not result in disproportionate inconvenience. In this case, Bachosa maintained numerous contacts with California during the course of its years-long business relationship with Global. Furthermore, those contacts gave rise to this dispute, and it was reasonable for Bachosa to expect that it would be haled into court in California to fulfill its obligations and to account for harm it foreseeably caused there. In regard to the individual defendants, the district court had specific personal jurisdiction over them based on Global's claims in its initial complaint. Finally, the panel exercised its discretion to reach the issue of dismissal based on forum non conveniens, and held that the balance of private and public interest factors did not favor dismissal. Moreover, California law will likely govern key issues and any burdens on the foreign defendant are insufficient to overcome the presumption in favor of Global's choice of its home forum. Therefore, the panel reversed in part, vacated in part, and remanded with instructions to deny the forum non conveniens motion on the merits.
Court Description: Personal Jurisdiction / Forum Non Conveniens. The panel reversed the district court’s order dismissing for lack of personal jurisdiction, vacated its orders on the parties’ remaining motions, and remanded with instructions to deny the forum non conveniens motion in an action brought by Global Commodities Trading Group, Inc. (“Global”), a California corporation, against Beneficio De Arroz Choloma, S.A. (“Bachosa”), a Honduran corporation, and two of its officers to recover losses on contracts. The panel held that the district court had specific personal jurisdiction over the corporate defendant, Bachosa. The panel was guided by the analysis in Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985). Interpreting genuine factual disputes in Global’s favor, the panel held that Global made a prima facie showing that Bachosa reached out beyond Honduras to create continuing relationships and obligations with citizens of California. The panel further held that the district court erred by considering the parties’ agreements in isolation, and ignored the business reality in which they were embedded. The panel concluded that Bachosa maintained numerous contacts with California during the course of its years long business relationship with Global. The panel held that the district court had specific personal jurisdiction over the individual defendants. The panel noted GLOB. COMMODITIES TRADING GRP. V. 3 BENEFICIO DE ARROZ CHOLOMA that personal jurisdiction over an individual who acts as an agent of a third party must be assessed on the individual’s actions alone. Interpreting genuine factual disputes in Global’s favor, the panel concluded that the individual defendants had extensive contacts with California. The panel held that these contacts were sufficient to support the exercise of specific jurisdiction over them. The panel also held that the guaranty signed by the individual defendants provided an independent basis for personal jurisdiction over them. The panel exercised its discretion to reach the issue of dismissal based on forum non conveniens, even though the district court had declined to consider it. The panel held that the balance of private and public interest factors did not favor dismissal. The panel held further that California law would likely govern key issues is this dispute, including the validity and enforceability of the parties’ memorandum, note, and guaranty. In addition, there was a presumption in favor of Global’s choice of its home forum – California. The panel held that litigation in the Eastern District of California would not result in disproportionate inconvenience. The panel remanded with instructions to deny the forum non conveniens motion on the merits.
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