801 F. Supp. 2d 211
S.D.N.Y.2011Background
- Constellation Energy petitions to confirm two London arbitration awards against ER Cape and to enforce them against ER Cape's alleged alter ego, ER Limited.
- Awards: first award (ER Cape to pay Constellation $7,577,600 plus 4.5% interest) and costs; second award (ER Cape to pay $7,467,608 plus 4% interest) with costs reserved; High Court of Justice in the UK denied ER Cape's appeals; ER Cape has not paid the awards.
- ER Cape moves to dismiss the petition for forum non conveniens, improper venue, and failure to state a claim; ER Limited did not appear.
- The action was brought under the New York Convention and admiralty jurisdiction; service on ER Cape is argued to also serve as service on ER Limited.
- Court decides (i) forum non conveniens denied; (ii) venue proper in SDNY; (iii) awards against ER Cape confirmed; (iv) alter ego claim against ER Limited dismissed for failure to plead plausible facts; (v) attorneys’ fees denied to Constellation; total judgment: $15,045,208 plus £40,559.
- ER Cape remains liable for the ER Cape awards; ER Limited is not held liable under alter ego theory at this stage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Forum non conveniens dismissal? | Constellation seeks to press home forum. | ER Cape argues UK/HK/BVI as adequate forums. | Denied; Constellation's US forum deference preserved. |
| Improper venue? | Constellation argues SDNY proper under aliens may be sued here. | ER Cape contends otherwise. | Denied; venue proper. |
| Confirm awards against ER Cape? | UN Convention allows recognition/enforcement against other party. | ER Cape challenged on appeals grounds only. | Granted; awards recognized/confirmed against ER Cape. |
| Alter ego against ER Limited? | ER Limited is alter ego of ER Cape; piercing allowed. | Insufficient pleadings; lack of plausible basis. | Dismissed; pleadings insufficient to state alter-ego claim. |
| Attorneys' fees and costs? | Fees warranted for delay tactic. | Default rule of each party bears own fees; nonfrivolous defense. | Denied; fees/costs not awarded. |
Key Cases Cited
- Iragorri v. United Techs. Corp., 274 F.3d 65 (2d Cir.2001) (deference to plaintiff's forum choice; Gulf Oil factors apply in SDNY)
- Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (Supreme Court 1947) (balances private/public interests in forum non conveniens)
- Monegasque De Reassurances, S.A.M. v. Nak Naftogaz of Ukraine, 311 F.3d 488 (2d Cir.2002) (three-step forum non conveniens analysis; deference to forum choice)
- Guidi v. Inter-Continental Hotels Corp., 224 F.3d 142 (2d Cir.2000) (home-forum concept for US plaintiffs; broader forum considerations)
- Pollux Holding Ltd. v. Chase Manhattan Bank, 329 F.3d 64 (2d Cir.2003) (adequacy of alternative forum; focus on litigation of subject matter)