Opinion
No. 3:02-CV-0081-N
December 19, 2002
MEMORANDUM OPINION AND ORDER
Before the Court is Defendant SSAB Tunnplat AB's ("SSAB") Motion to Dismiss, Defendant Danieli C SpA's ("Danieli") Motion to Dismiss under the Doctrine of Forum Non Conveniens, and Defendant Danieli Corporation's ("DC") Motion to Dismiss for Failure to State a Claim. For the reasons stated below, the Motions to Dismiss by SSAB and Danieli are GRANTED. The Motion to Dismiss by DC is DENIED, though the Plaintiff, Delta Brands, Inc. ("Delta") must amend its complaint, in accordance with this Order, and specifically state its allegations against DC, rather than allege facts generally against DC and Danieli as a collective entity.
I. BACKGROUND
This cases arises after two companies, Delta and Danieli competed to be the contractor on a project to supply certain steel processing equipment for SSAB's facility. During the contract negotiations, Delta allegedly provided confidential and proprietary information pertaining to its equipment to the Defendants. Delta entered into a confidentiality agreement pertaining to some of its confidential information with Danieli, and Delta claims that both Danieli and DC are in breach of this agreement by using Delta's confidential information to manufacture Delta's equipment.
Delta further claims that the Defendants have misappropriated Delta's trade secrets and that Danieli and DC have breached the confidential relationship established by the execution of the confidentiality agreement. Delta alleges that all the Defendants have conspired together to acquire Delta's proprietary and confidential information, including its trade secrets. As part of this conspiracy, Delta claims that the Defendants made material misrepresentations to Delta regarding the Defendants intentions in obtaining Delta's confidential information.
A. The Parties
SSAB is a manufacturer of sheet steel. SSAB is a corporation organized and existing under the laws of Sweden with its principal place of business in Borlange, Sweden. SSAB has no subsidiaries or offices in the United States. Delta specializes in the design and manufacture of flat rolled metal processing equipment. Delta is a Texas corporation having its principal place of business in Irving, Texas. Danieli designs and manufactures all forms of rolling mill equipment, including levelers and shears. Danieli is a corporation organized and existing under the laws of Italy, with its principal place of business in Buttrio, Italy.
DC is the North American representative of Danieli. DC is a corporation organized and existing under the laws of Delaware, having its principal place of business in Cranberry Township, Pennsylvania. DC is a wholly owned subsidiary of Danieli Holdings, Inc., which is a wholly owned subsidiary of Industrielle Betelligung SA ("Industrielle"), a Luxembourg corporation. Industrielle is 90% owned by Danieli.
B. Delta's Bid to SSAB
In February of 2001, SSAB issued a request for bids ("RFB") for equipment to establish two new cut to length lines for processing heavy gauge steel at its plant in Borlange, Sweden. Cut to length lines, generally, involve uncoiling coils of steel, leveling the steel, cutting the steel to a specific length using a blade or shear, and then stacking the cut pieces. SSAB initially sent the RFB out to several companies, including Danieli. Delta did not receive the RFB from SSAB, but instead contacted SSAB and requested to be included in the bid process. In response, SSAB sent the RFB to Delta.
SSAB received responses to the RFB from several bidders, including Danieli and Delta. In June of 2001, Delta met with representatives of SSAB in Borlange, Sweden to discuss its bid. To further evaluate Delta's bid, representatives of SSAB traveled to the United States to see Delta's equipment and manufacturing facility firsthand. SSAB visited a facility in Indiana to view and inspect the operation of Delta's equipment and toured Delta's manufacturing facility in Texas. In its efforts to secure SSAB's project, Delta shared information with SSAB pertaining to Delta's manufacturing process and facility. Delta gave SSAB CD-ROMs, calculations, and layout drawings. SSAB never entered into a confidentiality agreement with Delta.
SSAB eventually narrowed the possible contractors to three finalists, including Delta and Danieli. The finalists traveled to Borlange, Sweden to participate in the final bidding and negotiation process. These meetings occurred from August 28th to September 1st of 2001. Danieli emerged as the successful contractor.
C. Delta's Bid to Danieli
After SSAB rejected Delta's bid for the complete project, Delta sought to be a subcontractor for Danieli on a portion of the project. Delta, therefore, sent drawings, a price sheet, and a product mix table to Danieli and DC, without a confidentiality agreement, in September of 2001. Delta traveled to Buttrio, Italy, in November of 2001, to make a presentation to Danieli regarding its partial bid. No representatives of DC attended the meeting. During this visit, Delta and Danieli executed a confidentiality agreement. After signing the agreement, Delta showed documents to Danieli regarding its rotary shear and electromagnetic stacker. After the meeting, Delta submitted a bid to Danieli to supply the shear and roll stacker. The two companies ultimately could not reach an agreement on price, and Danieli decided to manufacture the equipment itself.
II. SSAB's MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION A. Applicable Standard for Personal Jurisdiction
When a nonresident defendant moves to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing the district court's jurisdiction over the nonresident. Wilson v. Belin, 20 F.3d 644, 648 (5th Cir.), cert. denied, 513 U.S. 930 (1994); Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir. 1985). If the district court chooses to decide the motion to dismiss without an evidentiary hearing, the plaintiff may satisfy this burden by presenting a prima facie case for personal jurisdiction. Wilson, 20 F.3d at 648 (citing Thompson v. Chrysler Motors Corporation, 755 F.2d 1162, 1165 (5th Cir. 1985)). The court will take allegations of the complaint as true, except those allegations "controverted by opposing affidavits," and the court will resolve all conflicts in the facts in favor of the plaintiff. Thompson, 755 F.2d at 1165 (citing DeMelo v. Toche Marine, Inc., 711 F.2d 1260, 1270-71 (5th Cir. 1983)). In making its determination, the court may consider "affidavits, interrogatories, depositions, oral testimony, or any combination of . . . recognized [discovery] methods." Id. (citing Washington v. Norton Manufacturing, Inc., 588 F.2d 441, 443 (5th Cir.), cert. denied, 442 U.S. 942 (1979)).
"A federal district court sitting in diversity may exercise personal jurisdiction over a nonresident defendant if (1) the long-arm statute of the forum state confers personal jurisdiction over that defendant; and (2) exercise of such jurisdiction by the forum state is consistent with due process under the United States Constitution." Ruston Gas Turbines, Inc. v. Donaldson Company, Inc., 9 F.3d 415, 418 (5th Cir. 1993). A nonresident defendant is subject to the personal jurisdiction of a federal court sitting in diversity to the same extent that the defendant would be amenable to the jurisdiction of a state court in the same forum. Trinity Indus., Inc. v. Myers Assocs., Ltd., 41 F.3d 229, 230 (5th Cir.), cert. denied, 516 U.S. 807 (1995). This Court, therefore, must apply Texas law to ascertain if Texas, the forum state, could assert long-arm jurisdiction over the SSAB.
The Texas long-arm statute confers jurisdiction to the limits of the federal constitution. Hall v. Helicopteros Nacionales de Colombia, S.A., 638 S.W.2d 870, 872 (Tex. 1982), rev'd on other grounds, 466 U.S. 408 (1984). The court, therefore, need only concern itself with the federal due process inquiry. Aviles v. Kunkle, 978 F.2d 201, 204 (5th Cir. 1992) (citations omitted).
Due process requires the satisfaction of two elements to exercise personal jurisdiction over a nonresident defendant: (1) the nonresident must have some minimum contact with the forum which results from an affirmative act on its part such that the nonresident defendant could anticipate being haled into the courts of the forum state; and (2) it must be fair or reasonable to require the nonresident to defend the suit in the forum state. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474-77 (1985). The due process clause ensures that persons have "fair warning that a particular activity may subject [them] to the jurisdiction of a foreign sovereign." Id. at 472.
To establish minimum contacts, a nonresident defendant must do some act by which it "purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253 (1958) (citing Int'l Shoe Co. v. Washington, 326 U.S. 310, 319 (1945)). However, the unilateral activity of one asserting a relationship with the nonresident defendant does not satisfy this requirement. World-Wide Volkswagen Corporation v. Woodson, 444 U.S. 286, 298 (1980) (quoting Hanson, 357 U.S. at 253). In determining whether the exercise of jurisdiction is appropriate, the Supreme Court has focused less on presence in the forum state as a means to establish jurisdiction and looked increasingly to whether a defendant's contacts with the forum make it reasonable to require the defendant to defend the particular suit in that forum. Shaffer v. Heitner, 433 U.S. 186, 203 (1977).
Two types of in personam jurisdiction may be exercised over a nonresident defendant: specific and general. Specific jurisdiction exists if the cause of action is related to, or arises out of, the defendant's contacts with the forum, and those contacts meet the due process standard. Holt Oil Gas Corp. v. Harvey, 801 F.2d 773, 777 (5th Cir. 1986), cert. denied, 481 U.S. 1015 (1987). "When a court exercises personal jurisdiction over a defendant based on contacts with the forum related to the particular controversy, the court is exercising `specific jurisdiction.'" Id. General jurisdiction, on the other hand, may be found when the claim is unrelated to the nonresident's contacts with the forum but where those contacts are "continuous and systematic." Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (1984). In this case, Delta has asserted both that SSAB's contacts with Texas are continuous and systematic and that SSAB's contacts with Texas relate to the misrepresentations and misappropriation which are the subjects of this action. Thus, Delta seeks to have this court exercise either general or specific jurisdiction over SSAB.
Under either a general or specific jurisdiction analysis, however, "[t]he constitutional touchstone remains whether the defendant purposefully established `minimum contacts' in the forum State." Stuart v. Spademan, 772 F.2d at 1185, 1190 (5th Cir. 1985) (quoting Burger King, 471 U.S. at 474). The purposeful availment requirement of the minimum contacts inquiry "ensures that a defendant will not be haled into a jurisdiction solely as a result of `random,' `fortuitous,' or `attenuated' contacts . . . or of the `unilateral activity of another party or a third person.'" Stuart, 772 F.2d at 1191 (quoting Burger King, 471 U.S. at 475). A plaintiff must establish a substantial connection between the nonresident defendant and the forum state. Jones v. Petty-Ray Geophysical, Geosource, Inc., 954 F.2d 1061, 1068 n. 9 (5th Cir.), cert. denied, 506 U.S. 867 (1992).
A court must consider all factors when making the purposeful availment inquiry — "no single factor, particularly the number of contacts, is determinative." Stuart, 772 F.2d at 1192. "[W]hether the minimum contacts are sufficient to justify subjection of the non-resident to suit in the forum is determined not on a mechanical and quantitative test, but rather under the particular facts upon the quality and nature of the activity with relation to the forum state." Mississippi Interstate Express, Inc. v. Transpo, Inc., 681 F.2d 1003, 1006 (5th Cir. 1982).
B. This Court Cannot Exercise General Jurisdiction over SSAB
Delta maintains that SSAB is subject to the general jurisdiction of this Court because:
(1) SSAB Swedish Steel, Inc. ("Swedish Steel"), a wholly owned subsidiary of SSAB's parent, has an office in Pittsburgh, Pennsylvania; (2) an employee of Swedish Steel lives in Texas; (3) less than one percent of SSAB's overall tonnage of steel was sold in Texas; and (4) representatives of SSAB visited Delta's facility in Texas. These facts, when combined, are not sufficiently continuous and systematic contacts to subject SSAB to the general jurisdiction of this Court.
Both SSAB and Swedish Steel are wholly owned subsidiaries of SSAB Svenskt Stal AB ("Svenskt"). See Affidavit of Jonas Beckelin, Appendix of SSAB's Motion to Dismiss, at 69. When a subsidiary and its parent maintain separate and distinct corporate entities, the contacts of one cannot be imputed to the other for purposes of junsdiction. See Southmark Corp. v. Life Investors, Inc. 851 F.2d 763, 773-74 (5th Cir. 1988). Here the relationship between SSAB and Swedish Steel is even more attenuated than subsidiary and parent, as both companies are wholly owned subsidiaries of the same parent corporation. The contacts of Swedish Steel, therefore, cannot be imputed to SSAB if the entities are operated as separate and distinct corporations. SSAB asserts, through its Chief Financial Officer, that none of the officers of SSAB serve as officers of Swedish Steel and that neither corporation is involved in the daily operations of the other. See Affidavit of Jonas Beckelin, Appendix of SSAB's Motion to Dismiss, at 69-70. Delta has not provided any controverting facts or analysis regarding the corporations functioning as alter egos, and the Court will not assume such facts exist. The presence of Swedish Steel's office or employees, therefore, will not be imputed to SSAB for the purposes of personal jurisdiction.
Additionally, Swedish Steel's offices are located in Pennsylvania, therefore this fact is not persuasive in establishing jurisdiction in Texas.
Next, Delta asserts that SSAB's sales of steel in Texas, amounting to less that one percent of overall tonnage, is a continuous and systematic contact sufficient to warrant general jurisdiction over SSAB. The Court disagrees. The Fifth Circuit in Bearry v. Beech Aircraft Corporation held that general jurisdiction is not established by a defendant's flow of products into Texas, when each transaction was completed outside of Texas, because the laws of Texas neither protect nor benefit the defendant. 818 F.2d 370, 376 (5th Cir. 1987). SSAB's chief financial officer ("CFO") states that SSAB does not sell any of its products in Texas. See Affidavit of Jonas Beckelin, Appendix of SSAB's Motion to Dismiss, at 54. SSAB's CFO further states, upon information and belief, that third parties shipped 1,000 metric tonnes of SSAB's products to Texas in 2001, representing forty thousandths of one percent of SSAB's total annual output. Id. Since these transactions represent such a small portion of SSAB's overall sales and SSAB completed the sales outside of Texas, SSAB's flow of product into Texas does not subject it to the jurisdiction of this forum.
Finally, SSAB's tour of Delta's manufacturing facility does not rise to the level of continuous and systematic general business contacts with Texas, even if coupled with SSAB's minimal sales in Texas. SSAB does not have any United States subsidiaries or branch offices in the United States; SSAB does not maintain a place of business in Texas or have any employees in Texas; SSAB does not own or lease property or assets in Texas, does not own any bank accounts in Texas, nor does it pay taxes in Texas. Id. SSAB, thus, is not subject to the general jurisdiction of this forum.
C. Danieli's Contacts with Texas Do Not Support Specific Jurisdiction
Delta also contends that SSAB's contacts with Texas pertaining to the subject of this action are sufficient to subject SSAB to the specific jurisdiction of this Court. Delta asserts that SSAB made false representations to Delta, some of which were in Texas, that SSAB knew or should have known would result in the misappropriation of Delta's trade secret information. Delta also claims that SSAB and Danieli conspired together to acquire and misappropriate Delta's confidential and proprietary information. The Court is unpersuaded by Delta's conclusory jurisdictional claims.
Delta's Response to SSAB's Motion to Dismiss and Delta's First Amended Complaint do not reveal any misrepresentation made by SSAB nor any conspiracy between the parties. To establish a prima facie case for personal jurisdiction over SSAB, Delta must provide some factual basis. See Bullion v. Gillespie, 895 F.2d 213, 216-17 (5th Cir. 1990); Thomas v. Kadish, 748 F.2d 276, 282 (5th Cir. 1984) (affirming dismissal of claims against California defendants for lack of personal jurisdiction when the plaintiff stated only conclusory allegations of conspiracy based upon the defendants' acts in California and the alleged effects of the conspiracy in Texas). Delta does not refer this Court to any misrepresentations made by SSAB. The only representations to which Delta references representatives of SSAB making are statements praising Delta's technology. Expressions of opinion generally do not rise to the level of fraudulent misrepresentations, Boggan v. Data Sys. Network Corp., 969 F.2d 149, 154 (5th Cir. 1992), and Delta has not alleged any facts that could bring SSAB's representations under any exceptions to this rule.
Delta also fails to direct the Court to any facts that would support the theory that SSAB and Danieli were co-conspirators. Rather, Delta merely repeats bare allegations of fraud and conspiracy in its Response to SSAB's Motion to Dismiss and its First Amended Complaint. Therefore, because these unsupported, conclusory allegations do not establish a prima facie case that SSAB or its agents have committed a tort in Texas, the Court concludes that the Delta has failed to satisfy its burden of proving that SSAB has the requisite minimum contacts with Texas to permit this court to exercise personal jurisdiction over SSAB. See Jefferson v. Lead Indus. Ass'n, Inc., 106 F.3d 1245, 1250 (5th Cir. 1997) ("conclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss"); Guidry v. United States Tobacco Co., 188 F.3d 619, 631-32 (5th Cir. 1999) ("a general allegation of conspiracy without a statement of the facts constituting that conspiracy is only an allegation of a legal conclusion"). Accordingly, SSAB's Motion to Dismiss for lack of personal jurisdiction is granted.
II. DANIELI'S MOTION TO DISMISS FOR FORUM NON CON VENIENS A. The Standard for Dismissal under Forum Non Conveniens
When reviewing an action under diversity jurisdiction, a federal court in the Fifth Circuit must employ the federal law of forum non conveniens instead of state law. See In re Air Crash Disaster Near New Orleans, 821 F.2d 1147, 1159 (5th Cir. 1987), vacated on other grounds and remanded, Pan American World Airways, Inc., v. Lopez, 490 U.S. 1032 (1989), reinstated in relevant part, In re Air Crash Disaster Near New Orleans, 883 F.2d 17 (5th Cir. 1989). The premise underlying the doctrine of forum non conveniens is "that a court may resist imposition upon its jurisdiction even when jurisdiction is authorized." See McLennan v. American Eurocopter Corp., Inc., 245 F.3d 403, 423 (5th Cir. 2001). The doctrine presupposes at least two forums where the defendants are amenable to process and simply furnishes criteria for choice between them. Id. at 424.
The framework for analysis under forum non conveniens requires that the defendant seeking dismissal must first establish the existence of an alternative forum which is both available and adequate. Id. A foreign forum is available when the entire case and all parties can come within the jurisdiction of that forum. Id. A foreign forum is adequate when the parties will not be deprived of all remedies or be treated unfairly, even though they may not enjoy the same benefits as they might receive in an American court. Id.
Once the defendant seeking dismissal establishes an available and adequate alternative forum, the defendant must show that dismissal is warranted because of the balance of certain private and public interests. Id. The relevant private interest factors include: (a) the relative ease of access to sources of proof, (b) the availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses; (c) the possibility of view of premises, if view would be appropriate to the action; and (d) all other practical problems that make trial of a case easy, expeditious and inexpensive. Id. The relevant public interest factors include: (a) the administrative difficulties flowing from court congestion; (b) the local interest in having localized controversies decided at home; (c) the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action; (d) the avoidance of unnecessary problems in conflict of laws, or in the application of foreign law; and (e) the unfairness of burdening citizens in an unrelated forum with jury duty. Id.
Danieli has the burden of establishing that the doctrine of forum non conveniens applies. Robinson v. TCI/US West Communs., Inc., 117 F.3d 900, 907 (5th Cir. 1997). Its "burden of persuasion runs to all the elements of the forum non conveniens analysis." Air Crash, 821 F.2d at 1164. Danieli must demonstrate an adequate and available forum and "must also establish that the private and public interests weigh heavily on the side of trial in the foreign forum." Id. District courts must give deference to a plaintiff's choice of forum. Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947). "Unless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed." Id. Although such a plaintiff's choice is not dispositive, jurisdiction should be declined only in "exceptional circumstances." Id. at 504.
Courts, however, have lessened the deference they give to a plaintiff's choice of forum when the plaintiff is an American company that engages in international business. When an American corporation doing extensive foreign business brings an action for an injury that occurred in a foreign country, many courts have partially discounted the plaintiff's United States citizenship. Reid-Walen v. Hansen, 933 F.2d 1390, 1395 (8th Cir. 1991). "In an era of increasing international commerce, parties who choose to engage in international transactions should know that when their foreign operations lead to litigation they cannot expect always to bring their foreign opponents into a United States forum when every reasonable consideration leads to the conclusion that the site of the litigation should be elsewhere." Id. (quoting Contact Lumber Co. v. P.T. Moges Shipping Co., Ltd., 918 F.2d 1446, 1450 (9th Cir. 1990)).
B. Italy is an Available and Adequate Alternative Forum
Applying the forum non conveniens analysis to this action, the Court finds that the convenience of the parties, as well as the interests of justice are best served if Delta's action against Danieli is dismissed and refiled in an appropriate court in Italy. Italy provides an available forum for Delta's action against Danieli. Delta could have pursued its action against Danieli in Italy, where the confidentiality agreement was executed, the alleged misappropriation occurred, and Danieli maintains its principal place of business.
Italy, further, is an adequate forum for the Parties' dispute. Danieli has submitted some evidence that Italy's jurisdiction allows for the compelling of unwilling witnesses, pretrial exchange of documents, and remedies for the Delta's claims against Danieli. See Affidavit of Fabio Londero, Appendix in support of Danieli's Motion to Dismiss under the Doctrine of Forum Non Conveniens, at 1-2. Moreover, Delta does not contest the availability or adequacy of Italy as a forum. Therefore, because Italy can exercise jurisdiction over both Danieli and Delta and since neither will be deprived of all remedies or treated unfairly, this Court holds that Italy is an available and adequate forum.
Danieli also states in its Motion to Dismiss that DC will consent to the jurisdiction of the Italian legal system if necessary. Danieli's Motion to Dismiss under the Doctrine of Forum Non Conveniens, pg. 6. A defendant's submission to the jurisdiction of an alternative forum renders that forum available. See Veba-Chemie, A. G. v. M/V Getafix, 711 F.2d 1243, 1245 (5th Cir. 1983). Though this Court chooses not to transfer Delta's entire case under forum non conveniens, Italy is also an available forum for Delta's claims against DC for purposes of this analysis.
C. Private Interest Factors Favor Dismissal
1. Ease of Access to Sources of Proof — Danieli argues that both the sources of proof and the majority of the witnesses necessary for trial are located in Italy and Europe. Danieli engineers will work on the design and manufacture of the SSAB steel project in Germany, Poland, and Italy, therefore much of the documentary evidence and proof will be in Europe. Danieli also asserts that the other bidders on the SSAB project are located in Europe, one in Italy. Delta counters Danieli's arguments by stating that its corporate headquarters, witnesses, and proprietary information are located in Texas. Delta lists seven witnesses living in the United States that are connected to the matters underlying the subject of this action.
Considering the facts set forth by the Parties, the Court finds that on balance an Italian forum would provide better access to the sources of proof necessary to litigate this action. The heart of Plaintiff's claims against Danieli are breach of a confidentiality agreement, misappropriation of proprietary information, and fraudulent misrepresentation. The confidentiality agreement was negotiated, executed, and allegedly breached in Italy, and the misappropriation and misrepresentations also allegedly occurred in Italy. The confidential and proprietary information provided to Danieli concerning Delta's equipment was a relatively small volume of information necessary for a bid and presentation. These documents and drawings could once again easily be transported to Italy, as this information was once before provided to Danieli in Italy. The information pertaining to SSAB's steel project and Danieli's design and engineering documents, however, is a much more voluminous amount of information and is located in Europe.
Of the seven witnesses listed by Delta with information potentially relevant to this action, three of them — Samuel Savariego, Richard Edminston, and Gerald Czajkowski — have information most relevant to Delta's claims against SSAB. As this Court does not have jurisdiction over SSAB, the location of these witnesses is largely immaterial. Delta, thus, has four potentially relevant witnesses located in the United States.
Danieli argues that the relevant testimony of another witness of Delta — Joseph Glover, an employee of UNICO the software manufacturer of some of Delta's equipment — appears to be hearsay, therefore his location may not weigh in favor of a Texas forum.
The balance of the witnesses with relevant information are in Europe. These witnesses include: the Danieli representatives who attended the meeting with Delta, the Danieli employees who designed the equipment at issue, the SSAB employees with knowledge of the equipment at issue, Delta's Italian UNICO representative, the employees of Biele S.A., the Spanish manufacturers of the equipment at issue, and other bidders of the SSAB steel project, who apparently have knowledge pertaining to the trade secret status of Delta's equipment design. The clear majority of the witnesses and proof are located in Europe. Though Italy is the relevant forum, not the European Union, the proximity of an Italian court is clearly more convenient for these witnesses than Texas.
2. Cost of Attendance and Availability of Witnesses — The second private interest factor is the availability of compulsory process for attendance of unwilling witnesses and the cost of obtaining attendance of willing witnesses. Danieli argues that foreign, non-party witnesses may not be subject to the subpoena power of United States courts, therefore this factor should cut in its favor. Danieli, however, offers neither a list of unavailable witnesses nor evidence supporting this bald assertion. Similarly, Danieli fails to address whether these unnamed, unavailable witnesses would be subject to the subpoena power of an Italian forum, therefore the availability of witnesses prong favors neither party.
It appears, though, that the cost of obtaining attendance of willing witnesses would be much less if the trial were held in Italy. As discussed above, almost all of the potentially relevant testimony pertaining of the facts underlying this action would be from employees residing in Europe. Italy, thus, would be a much closer and convenient forum for these witnesses. This factor, therefore, favors Danieli.
3. View of the Premises — Delta does not address this factor in its Response to Danieli's Motion to Dismiss. Danieli argues that a view of the equipment at issue can only occur in Italy or Sweden and this factor should weigh heavily in its favor. The facts before the Court suggest that the relevant equipment is being manufactured in Italy and Spain and will be installed in Sweden. If any of the equipment is still located in Italy, this factor could be in Danieli's favor. Danieli, however, fails to address what equipment is in Italy or why a view of this equipment would be important.
Danieli also argues that representative machines manufactured by competitive bidders of the SSAB steel project and a reference project used by Danieli are located in Italy or Europe, and that Delta has installations in Europe, two of which are in Italy. Danieli fails to indicate why a view of these installations would be important or even relevant in this litigation. Therefore, this factor does not favor either party.
4. Other Practical Problems Making Trial Easy, Expeditious and Inexpensive — Danieli argues that all of its representatives that attended the meeting in which the confidentiality agreement was executed speak Italian and would need an interpreter if the litigation was in Texas. Delta also argues that its internal documents relevant to the SSAB steel project are in Italian and would need to be interpreted into English. Delta counters Danieli arguments by stating that most of its confidential and proprietary documents are in English and would need to translated into Italian. Though these arguments tend to offset each other, this factor does tilt in Danieli's favor given the greater number of witnesses in Italy and the larger volume Italian project documents, as discussed above in the ease of access to sources of proof analysis.
Considering the private interest factors together, Danieli has shown that they weigh in its favor. However, the burden on Danieli is high, therefore the Court will address the public interest factors as well.
D. Public Interest Factors Favor an Italian Forum
Since neither Party addresses the administrative difficulties arising from congested courts in either Texas or Italy, the Court will not address this factor. The next factor — the local interest in having localized controversies decided at home — heavily favors dismissing this action. Texas does have an interest in providing a forum in which Texas litigants can bring their claims, however this interest is small when compared with Italy's interest in regulating companies that conduct business within its boundaries. This dispute involves business presentations and negotiations in Italy, a confidentiality agreement executed in Italy, and Danieli's conduct in Italy. Therefore, though this dispute involves a Texas corporation, it is more properly characterized as an Italian controversy.
Texas' interest is further minimized by the fact that a large portion of Delta's sales are outside of the United States. Delta's president stated in an article in the Dallas Morning News Article that, at times, 95% of Delta's business is outside of the United States. See Danieli's Supplemental Appendix in support of its Motion to Dismiss, pg. 26.
The next two factors — the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action and the avoidance of unnecessary problems in conflict of laws, or in the application of foreign law — heavily favor an Italian forum resolving this conflict. The contract between Delta and Danieli was negotiated, executed, and performable in Italy. All meetings associated with the underlying subject matter occurred in Italy. Any disclosure of confidential information and alleged improper use of such information occurred in Italy. Under a most significant contacts analysis, Italian law apparently would apply. See Maxus Exploration Co. v. Moran Bros., Inc., 817 S.W.2d 50, 53 (Tex. 1991). Similarly, most of the facts and events underlying Delta's misappropriation of trade secrets claim, fraud claim, and negligent misrepresentation claim all appear to have occurred in Italy. Therefore, since Italian law appears to govern the underlying action, these factors weighs strongly in favor of Danieli's Motion to Dismiss.
The last factor, the burden of jury duty, also favors dismissal. Texas jurors do not have a strong interest in resolving a dispute based upon contracts signed, allegedly breached, and torts committed in Italy. Though Delta is headquartered in Texas, it does a large part of its business outside of the country and this entire controversy arose in Europe. "Jury duty is a burden that ought not be imposed upon the people of a community which has no relation to the litigation." Gulf Oil, 330 U.S. at 508-09. Therefore, this factor also weighs in Danieli's favor.
Having considered both the private and public interest factors, the Court holds that Danieli has made the strong showing necessary to justify dismissing this case based on forum non conveniens because the balance of convenience tilts strongly in favor of litigating the case in Italy. Italy is an available and adequate forum. The private interest factors tend to weigh in Danieli's favor, and the public interest factors strongly tilt toward dismissal. The Court, therefore, declines to exercise jurisdiction, and Danieli's Motion to Dismiss under the Doctrine of Forum Non Conveniens is granted.
IV. DC's MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM
DC filed a Motion to Dismiss Delta's claims under Federal Rule of Procedure 12(b)(6). The thrust of DC's argument is that Delta's complaint does not contain any direct factual allegations concerning DC's involvement in the underlying events. Specifically, DC complains that Delta's claims generally refer to Defendant "Danieli," a collective term which Delta has defined as referring to Danieli and DC.
DC appears to be correct in its argument; Delta's First Amended Complaint does wholly fail to provide any factual allegations that point to specific actions or specific conduct on the part of DC, except to the extent the defined term "Danieli" includes DC. Furthermore, based upon the factual record before the Court at this time, the heart of Delta's claims concern the actions of SSAB and Danieli. However, Delta has crafted its complaint in such away, by lumping together DC and Danieli, as to be able to withstand a 12(b)(6) challenge. Therefore, rather than dismiss Delta's claims against DC, the Court orders Plaintiff to amend its petition, within 10 days of the date of this Order, to specifically state its allegations against DC as an individual entity. DC's Motion to Dismiss, therefore, is denied.