Crm Limited v. Supreme Risk Management Fze

First MOTION to Dismiss for Lack of Jurisdiction Pursuant to Federal Rule of Civil Procedure 12

E.D. Va.April 19, 2017

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION CRM LIMITED, Petitioner, v. SUPREME RISK MANAGEMENT FZE, Respondent. § § § § § § § § § § Civil action No.: 1:16-CV-01344 MEMORANDUM OF LAW IN SUPPORT OF RESPONDENT SUPREME RISK MANAGEMENT FZE’S MOTION TO DISMISS PETITIONER’S PETITION TO CONFIRM FOREIGN ARBITRAL AWARD FOR LACK OF PERSONAL JURISDICTION PURSUANT TO FRCP 12(B)(2) CLYDE & CO US LLP 1000 Potomac Street NW, 5th Floor Washington, D.C. 20007 +1 (202) 747 5100 (Tel.) +1 (202) 747 5150 (Fax) Attorneys for Respondent Supreme Risk Management FZE Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 1 of 17 PageID# 357 i TABLE OF CONTENTS Page I. PRELIMINARY STATEMENT ........................................................................................ 1 II. FACTUAL BACKGROUND AND SUMMARY OF RELEVANT ALLEGATIONS..... 2 III. LEGAL STANDARD ON MOTION TO DISMISS .......................................................... 3 IV. THIS COURT LACKS PERSONAL JURISDICTION OVER SRM ................................ 4 A. THE NEW YORK CONVENTION DOES NOT CONFER PERSONAL JURISDICTION OVER SRM .................................................................................... 4 B. SRM IS NOT AN “ALTER EGO” OF SUPREME FOODS SERVICE GMBH (“SFS”) OR ANY OTHER SUBSIDIARY OF THE SUPREME GROUP B.V. ...... 4 C. EXERCISING PERSONAL JURISDICTION OVER SRM WOULD VIOLATE THE DUE PROCESS CLAUSE OF THE FOURTEENTH AMENDMENT ........... 9 1. THIS COURT LACKS GENERAL JURISDICTION OVER SRM ................ 9 2. THIS COURT LACKS SPECIFIC JURISDICTION OVER SRM ............... 11 V. CONCLUSION ................................................................................................................. 12 Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 2 of 17 PageID# 358 ii TABLE OF AUTHORITIES Page(s) Cases Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) ...........................................................................................................7 Base Metal Trading, Ltd. v. OJSC “Novokuznetsky Aluminum Factory,” 283 F.3d 208, 212 (4th Cir. 2002) .............................................................................................4 Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556 (U.S. 2007) ..................................................................................................7 Board of Trustees v. Midatlantic Site Servs., LLC, No. 1:14-Cv-1281, 2015 WL 4634417 (E.D. Va. Aug. 3, 2015) ..............................................6 Colt Defense LLC, No. 2:04-Cv-258, 2014 U.S. Dist. LEXIS 28690 (E.D. Va. Oct. 22, 2004) ..........................5, 6 Consulting Eng’rs Corp. v. Geometric Ltd., 561 F.3d 273 (4th Cir. 2009) ...............................................................................................9, 11 Cordova v. Alper, 64 VA. Cir. 87 (Va. Cir. 2004) ..................................................................................................5 Dry Handy Invs., Ltd. v. Corvina Shipping Co. S.A., 988 F. Supp. 2d 579 (E.D. Va. 2013) ........................................................................................6 ESAB Group, Inc. v. Centricut, Inc., 126 F.3d 617 (4th Cir.1997) ......................................................................................................9 Flame S.A. v. Freight Bulk Pte. Ltd., 807 F.3d 572 (4th Cir. 2015) .....................................................................................................6 Grayson v. Anderson, 816 F. 3d 262 (4th Cir. 2016) ....................................................................................................4 Helicópteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408 (U.S. 1984) ...........................................................................................................9 Informatics Applications Grp. Inc. v. Shkolnikov, 836 F. Supp. 2d 400 (E.D. Va. 2011) ........................................................................................5 Interocean Shipping Co. v. Nat’l Shipping & Trading Corp., 523 F.2d 527, 539 (2d Cir.1975) ...............................................................................................8 Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 3 of 17 PageID# 359 iii JTH Tax, Inc. v. Liberty Servs. Title, Inc., 543 F. Supp. 2d 504 (E.D. Va. 2008) ........................................................................................3 Mylan Labs, Inc. v. Akzo, N.V., 2 F.3d 56 (4th Cir. 1993) ...........................................................................................................4 Ost-West-Handel Bruno Bischoff GmbH v. Project Asia Line, Inc., 160 F.3d 170 (4th Cir. 1998) .....................................................................................................5 Perpetual Real Estate Servs., Inc. v. Michaelson Props., Inc., 974 F.2d 545 (4th Cir. 1992) .................................................................................................5, 8 Saudi v. Northrop Grumman, 427 F.3d 271 (4th Cir. 2005) ...............................................................................................9, 10 Vitol, S.A. v. Primerose Shipping Co. Ltd., 708 F.3d 527 (4th Cir. 2013) .............................................................................................4, 5, 6 Williams v. AES Corp., 28 F. Supp. 3d 553, 564 (E.D. Va. 2014) ..............................................................................5, 8 Other Authorities Federal Rule of Civil Procedure 12(b)(2) ..................................................................................3, 12 Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 4 of 17 PageID# 360 I. PRELIMINARY STATEMENT Petitioner CRM Limited (“CRM” or “Compass” or Petitioner”), a company organized under the laws of the Emirate of Ras Al Khaimah, United Arab Emirates, through its Petition to Confirm Foreign Arbitral Award (the “Petition”) seeks an order from this Court confirming an arbitral award rendered in the United Arab Emirates on June 21, 2016 against Respondent Supreme Risk Management FZE (“SRM” or “Respondent”)—a company also organized under the laws of the Emirate of Ras Al Khaimah, United Arab Emirates, and with no contacts whatsoever in the United States. Because SRM has absolutely no contacts with the U.S. that would support personal jurisdiction over it, the Petition must be dismissed with prejudice. Indeed, even if this Court has subject matter jurisdiction under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 (the “New York Convention” or the “Convention”), as Petitioner alleges it does, it is well settled that the Convention does not confer personal jurisdiction when it otherwise would not exist and this Court cannot confirm the underlying arbitral award in the absence of both personal and subject matter jurisdiction. In an effort to overcome this insurmountable jurisdictional hurdle, Petitioner incorrectly asserts that the Court has personal jurisdiction over SRM based on an “alter ego” theory. Petitioner makes factual allegations in the Petition that are wholly unrelated to any contacts, acts, or specific business activities carried out by SRM and that instead concern the acts and tangentially-related business activities of several subsidiaries of Supreme Group B.V., a Dutch holding company that is the parent company of SRM and several other subsidiary companies. However, SRM is not the alter ego of any of Supreme Group B.V.’s subsidiary companies, because SRM does not direct or control the actions of any of Supreme Group B.V.’s subsidiaries and Petitioner has proffered no basis for disregarding the subsidiaries’ corporate separateness. Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 5 of 17 PageID# 361 2 Indeed, Petitioner’s use of the catch-all term “Supreme Group” throughout the Petition to collectively refer to parent-company Supreme Group B.V. and its different subsidiary companies is nothing more than a futile attempt by Petitioner to hide the fact that each Supreme Group B.V. subsidiary is a separate legal entity organized and existing under the laws of a jurisdiction outside of Virginia. Similarly, the Court should reject Petitioner’s argument that the alleged “systematic and continuous” contacts of certain of Supreme Group B.V.’s subsidiary companies are sufficient to satisfy the due-process requirements for exercising jurisdiction over SRM, despite the complete absence of any of SRM’s contacts with this forum. Under current jurisprudence, state judicial power over foreign corporations remains limited to those foreign corporations who have contacts with the state such that the state’s exercise of judicial power over such corporation does not offend traditional notions of fair play and substantial justice. The principles of basic fairness required by the Due Process Clause are not satisfied here because SRM has no contacts with this state or with any other state in the U.S. Therefore, this Court may not exercise personal jurisdiction over SRM. For all these reasons, the Petition must be dismissed with prejudice. II. FACTUAL BACKGROUND AND SUMMARY OF RELEVANT ALLEGATIONS SRM is an Emirati company with its only place of business in the Emirate of Ras Al Khaimah, United Arab Emirates. See Declaration of Søren Borup Norgaard (the “Norgaard Declar.”) at ¶ 5. SRM is not licensed, registered or authorized to do business in this state or in any state in the United States and neither has, nor has ever had, an agent for service of process in this state. (Id.). SRM has also never maintained an office or any other kind of physical presence anywhere in the U.S. and neither has, nor has ever had, a bank account or any other property in the United States. (Id. at ¶¶ 5, 7). In addition, SRM has never had any directors, officers, or Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 6 of 17 PageID# 362 3 employees residing in the U.S. and has never engaged in business activities in this state or anywhere else in the United States. (Id. at ¶¶ 6, 9). SRM is wholly owned by Supreme Group B.V., a Dutch holding company that owns different companies throughout the world, with each company operating as a distinct legal entity organized and existing under the laws of the jurisdiction in which the entity is located or operates. (Id. at ¶¶ 1, 2). While this group of subsidiary companies is often referred to using the trade name “Supreme Group,” each individual subsidiary (including SRM) has always strictly observed all corporate formalities and maintained a separate, distinct, and independent corporate existence from each of the other subsidiaries owned by Supreme Group B.V. (Id. at ¶¶ 2, 10). Indeed, the very allegations of the Petition emphasize this corporate separateness between SRM and the other Supreme Group B.V. subsidiaries. For example, Petitioner concedes that the subsidiaries of Supreme Group B.V. do not share expenses and liabilities. (Petit., ¶ 9) (“Supreme Group entities were to pay separately for security services”). Nor do they share personnel. (Id. at ¶ 10) (“Peter Boras, Supreme Group’s operations director [is] not . . . an employee of SRM); (Id.) (“Ernest Pallett, the Supreme Group’s security director, [is] again not an employee of SRM”). SRM does not and has never solicited, initiated, or conducted business activities in this district or anywhere else in the United States. (Norgaard Declar., ¶ 8). Nor does it manage, direct or control the business activities in the U.S. or elsewhere of any of the other Supreme Group B.V. subsidiaries. (Id. at ¶¶ 8, 9). III. LEGAL STANDARD ON MOTION TO DISMISS Federal Rule of Civil Procedure 12(b)(2) permits a party to move the court to dismiss an action if the court lacks personal jurisdiction over the moving party. JTH Tax, Inc. v. Liberty Servs. Title, Inc., 543 F. Supp. 2d 504, 505 (E.D. Va. 2008). Indeed, a “Rule 12(b)(2) challenge Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 7 of 17 PageID# 363 4 raises an issue for the court to resolve, generally as a preliminary matter.” Grayson v. Anderson, 816 F. 3d 262, 267 (4th Cir. 2016). When, as is the case here, a court’s personal jurisdiction is properly challenged by motion under Federal Rule of Civil Procedure 12(b)(2), the burden is on the petitioner “to prove grounds for jurisdiction by a preponderance of the evidence.” Mylan Labs, Inc. v. Akzo, N.V., 2 F.3d 56, 60 (4th Cir. 1993). Here, Petitioner’s theories of personal jurisdiction based solely on the supposed U.S. contacts not of SRM, but of other subsidiaries of Supreme Group B.V. are attenuated and based on bare and unsubstantiated allegations. Therefore, Petitioner has failed to meet its burden of demonstrating that the Court’s personal jurisdiction over SRM exists by a preponderance of the evidence. IV. THIS COURT LACKS PERSONAL JURISDICTION OVER SRM A. THE NEW YORK CONVENTION DOES NOT CONFER PERSONAL JURISDICTION OVER SRM Although the Convention and its implementing legislation “confers subject matter jurisdiction over actions brought pursuant to the Convention, it does not confer personal jurisdiction when it would otherwise not exist. In other words, a petitioner must still demonstrate that personal jurisdiction is proper under the Constitution.” Base Metal Trading, Ltd. v. OJSC “Novokuznetsky Aluminum Factory,” 283 F.3d 208, 212 (4th Cir. 2002) (emphasis added). Therefore, the Petition’s assertion that “[t]his Court has subject matter jurisdiction under the Convention” (Petit., ¶ 23) absent an independent basis for personal jurisdiction plainly precludes this Court from granting the Petition. B. SRM IS NOT AN “ALTER EGO” OF SUPREME FOODS SERVICE GMBH (“SFS”) OR ANY OTHER SUBSIDIARY OF THE SUPREME GROUP B.V. To establish personal jurisdiction over a foreign corporation based on the in-state acts of one of its affiliate or “sister” companies, the court must determine that the foreign corporation is the “alter ego” of the sister company. Vitol, S.A. v. Primerose Shipping Co. Ltd., 708 F.3d 527, Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 8 of 17 PageID# 364 5 543 (4th Cir. 2013). Only if the court determines that the alleged alter ego corporation is nothing more than a legal fiction with no corporate separateness will the court confer jurisdiction over the alleged alter ego corporation through a process referred to as corporate veil piercing. Id. (holding that a “corporate entity is liable for the acts of a separate, related entity only under extraordinary circumstances”) (internal citations and quotation marks omitted). Under Virginia law, the party seeking to pierce the corporate veil bears the burden of proof. Williams v. AES Corp., 28 F. Supp. 3d 553, 564 (E.D. Va. 2014) (holding that the petitioner “bears the burden of demonstrating personal jurisdiction by a preponderance of the evidence once its existence is questioned” by the respondent). Indeed, this state’s “longstanding recognition of the independent existence of a corporate entity is a basic component of corporate law” that Virginia courts are not inclined to disregard. Cordova v. Alper, 64 VA. Cir. 87, 112 (Va. Cir. 2004). To that end, this state’s “more rigorous standard” for corporate veil piercing requires an evidentiary showing that (1) the corporation “was the alter ego, alias, stooge, or dummy” of the other entity; and that (2) “the corporation was a device or sham used to disguise wrongs, obscure fraud or conceal crime.” Perpetual Real Estate Servs., Inc. v. Michaelson Props., Inc., 974 F.2d 545, 548 (4th Cir. 1992); Williams, 28 F. Supp. 3d at 562 (same); Informatics Applications Grp. Inc. v. Shkolnikov, 836 F. Supp. 2d 400, 427 (E.D. Va. 2011) (same); Colt Defense LLC, No. 2:04-Cv-258, 2004 U.S. Dist. LEXIS 28690 at *57 (E.D. Va. Oct. 22, 2004) (same). Both prongs of this two-part test must be satisfied for a finding of alter ego status. Perpetual Real Estate Servs., Inc., 974 F.2d at 548. The Fourth Circuit has generally found the application of the alter ego doctrine “unorthodox” where the two entities are not parent and subsidiary corporations, but are instead sister corporations. Ost-West-Handel Bruno Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 9 of 17 PageID# 365 6 Bischoff GmbH v. Project Asia Line, Inc., 160 F.3d 170, 174 (4th Cir. 1998) (holding that the majority of alter ego cases involve a parent-subsidiary relationship). To establish jurisdiction based on an alter ego theory, the proponent of the theory must demonstrate that the alleged alter ego controlled and directed the acts of its sister company so that the in-state actions of the sister company can be imputed to the alleged alter ego company. Colt Defense LLC, U.S. Dist. LEXIS 28690 at *53-54. The benchmark for analyzing control is whether the alleged alter ego corporation “exercised substantial influence” over the sister corporation’s “decision to carry on the in-forum activities which constitute the relevant minimum contacts” with the forum required to warrant the exercise of personal jurisdiction over it. Id. at *54. It is well settled that this determination of control does not “rest on a single factor” but instead “involve[s] a number of . . . factors” and “in addition it must present an element of injustice or fundamental unfairness.” Dry Handy Invs., Ltd. v. Corvina Shipping Co. S.A., 988 F. Supp. 2d 579, 583 (E.D. Va. 2013). Evidence of mere “interconnectedness” between affiliate entities or a “close business relationship” even where such relationship “sometimes results in the disregard of formalities” is insufficient to establish the level of control required to give rise to alter ego status and to invoke the extraordinary remedy of corporate veil piercing. Vitol, S.A., 708 F.3d at 547-48; Dry Handy Invs., Ltd., 988 F. Supp. at 583 (“[I]t is only in those extraordinary cases, such as the corporate form being used for wrongful purpose, where courts will piece the corporate veil and disregard the corporate entity.”) (internal citations and quotation marks omitted). Indeed, courts in this Circuit have denied an ultimate finding of alter ego even where the plaintiff has sufficiently alleged that the companies share the same website, have the “same managing member,” are “engaged in the same or essentially the same business” and were “marketed as a joint operation”. Board of Trustees v. Midatlantic Site Servs., LLC, No. 1:14- Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 10 of 17 PageID# 366 7 Cv-1281, 2015 WL 4634417, at *6 (E.D. Va. Aug. 3, 2015). The Fourth Circuit has similarly specified that “not all corporations with a common owner are alter egos” of one another. Flame S.A. v. Freight Bulk Pte. Ltd., 807 F.3d 572, 588 (4th Cir. 2015). A finding of alter ego among entities with a common owner is only appropriate where “the evidence shows a common owner who fails to observe corporate formalities” in an effort to “avoid legal obligations”. Id. Here, Petitioner fails to make any specific factual allegations concerning the dealings of SRM and any of the subsidiaries of Supreme Group B.V. that would support a finding of control, the sine qua non of alter ego status. Except for conclusory allegations that SRM “is an alter ego of the Supreme Group and/or SFS, such that jurisdictional contacts of the Supreme Group and SFS with this venue are attributable to SRM” (Petit. at ¶ 26) and bald assertions that SRM is “not an independent legal entity, but instead an extension of the Supreme Group” (Id.) and is “undercapitalized and effectively a shell” (Id. at ¶ 27(a)), Petitioner has not and cannot plead with sufficient specificity that SRM is the alter ego of SFS or any other Supreme Group B.V. subsidiary and it is well settled that unsupported allegations and bald legal conclusions are not entitled to the presumption of truth and cannot alone meet federal pleading standards. See Ashcroft v. Iqbal, 556 U.S. 662, 678–79 (U.S. 2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556 (U.S. 2007)). Here, Petitioner has failed to proffer any evidence of control whatsoever. In fact, Petitioners do not even allege that SRM directly controls the actions of SFS or any of the subsidiaries of Supreme Group B.V. and instead openly concedes that it is Supreme Group B.V. and not SRM that “directly or indirectly controls” the Supreme Group B.V. subsidiaries. (Petit., ¶ 27(d)). Indeed, SRM does not manage, direct or control the business activities in the U.S. or elsewhere of any subsidiary of the Supreme Group B.V. because it is not the parent company. (Norgaard Declar., ¶¶¶ 2, 8, 9). Instead, SRM is no more than a sister Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 11 of 17 PageID# 367 8 corporation of “the Supreme Group and/or SFS” (Petit. at ¶ 26), which are all ultimately owned by Dutch parent company Supreme Group B.V. (Norgaard Declar. at ¶ 2). SRM has always strictly observed all corporate formalities including maintaining proper corporate records. (Id. at ¶ 10). In fact, each year, SRM’s accounts are audited by external auditors to ensure compliance with local laws. (Id.). SRM also renews its trade license each year, which it can only do if it is in good standing with local law. (Id.). The Petition’s allegations that SRM entered into security contracts with the Petitioner (Petit., ¶ 1) are similarly insufficient to establish that SRM controlled any of its sister companies. The Fourth Circuit has held that courts “have been extraordinarily reluctant to lift the veil in contract cases.” Perpetual Real Estate Servs., Inc., 974 F.2d at 550 (citing Interocean Shipping Co. v. Nat’l Shipping & Trading Corp., 523 F.2d 527, 539 (2d Cir.1975) (requiring conduct “akin to fraud” in order to pierce the corporate veil in contract case)). Similarly, Petitioner has not established that SRM was created or used to disguise a wrong, obscure fraud, or conceal crime. Williams, 28 F. Supp. 3d at 562. Petitioner’s allegation that SFS, a Supreme Group B.V. entity entirely separate from SRM, and its “successor company” allegedly “pled guilty to defrauding the U.S. government” (Petit., ¶ 27(e)) is plainly insufficient to make this showing. Indeed, allegations that “[f]ollowing this guilty plea” (id.), SRM was notified of SFS’ purported wrongdoing and “proposed debarment” (id.) does not in any way support a finding that SRM was created or used to disguise a wrong, obscure fraud, or conceal crime. SRM was never directly or indirectly involved in any matter that led to the SFS plea. Because SRM does not control any of the Supreme Group entities and was not created or used to disguise a wrong, obscure a fraud, or conceal crime, there is no basis for this Court to Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 12 of 17 PageID# 368 9 pierce the corporate veil and to find that SRM is the alter ego of any of the Supreme Group B.V. subsidiaries. Thus, Petitioner’s alter ego theory must fail. C. EXERCISING PERSONAL JURISDICTION OVER SRM WOULD VIOLATE THE DUE PROCESS CLAUSE OF THE FOURTEENTH AMENDMENT To justify the exercise of personal jurisdiction over a non-resident respondent, the respondent’s contacts with the forum state must have been so substantial that “they amount to a surrogate for presence and thus render the exercise of sovereignty just.” ESAB Group, Inc. v. Centricut, Inc., 126 F.3d 617, 623 (4th Cir.1997). “It is essential in each case that there be some act” by which the respondent “purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” Id. Under the Due Process Clause, personal jurisdiction may either be “general” or “specific.” Helicópteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 411 (U.S. 1984). A court may exercise “general jurisdiction” when a respondent has “continuous and systematic” contacts with the forum state. Saudi v. Northrop Grumman, 427 F.3d 271, 276 (4th Cir. 2005) (internal citations and quotation marks omitted). A court may exercise “specific jurisdiction” where a respondent’s “cause of action arises out of the [respondent’s] contacts with the forum [state].” Id. Here, neither general nor specific jurisdiction exist. 1. THIS COURT LACKS GENERAL JURISDICTION OVER SRM It is well settled that to “satisfy the constitutional due process requirement” a respondent “must have sufficient minimum contacts with the forum state such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Consulting Eng’rs Corp. v. Geometric Ltd., 561 F.3d 273, 281 (4th Cir. 2009) (internal citations and quotation marks omitted). Indeed, “[t]he jurisdictional inquiry remains centered on the extent, nature, and quality” of a respondent’s contacts with the forum state. Id. Evidence of a “contractual Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 13 of 17 PageID# 369 10 relationship does not rise to the level of continuous and systematic contact” with the forum state. Saudi, 427 F.3d at 276 (internal citations and quotation marks omitted). Absent from the Petition is a single allegation that SRM has any contacts with the state of Virginia. Instead, Petitioner alleges in a conclusory form only that “[i]t does not offend traditional notions of fair play and substantial justice for SRM to be subject to this Court’s jurisdiction . . .” (Petit., ¶ 29). However, nowhere in the Petition does Petitioner allege any contact by SRM—much less “continuous and systematic” contact—with this state. Indeed, the Norgaard Declaration confirms the absence of any contact between SRM and this state or any state in the United States. Despite the detailed factual allegations concerning SFS or any other Supreme Group B.V. subsidiary, there is not a single factual allegation in the Petition as to any action taken specifically by SRM upon which general jurisdiction could be based. Apart from conclusory assertions that SRM is “an alter ego of the Supreme Group and/or SFS, such that the jurisdictional contacts of the Supreme Group and SFS with this venue are attributable to SRM” (Petit., ¶ 26), the Petition lacks a single factual allegation to substantiate this assertion. Indeed, the purported “evidence” (id. at ¶ 27) that Petitioner proffers in subparagraphs (a) through (e) of Paragraph 27 of the Petition to establish that SRM had “contacts” (id. at ¶ 26) with the Eastern District of Virginia sufficient to subject SRM to the jurisdiction of this Court is nothing more than mere conclusory statements, unsubstantiated by any facts. Saudi, 427 F.3d at 276 (holding no general jurisdiction because plaintiff provided “virtually no evidence” that the defendant’s contracts with the forum state were “continuous and systematic”). Similarly, although the Petition makes repeated references to a “contract between [Petitioner] and SRM” (Petit., ¶ 1) as well as “contracts with various representatives from the Supreme Group” (id. at ¶ 8) to establish general jurisdiction over SRM, the performance of these Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 14 of 17 PageID# 370 11 contracts occurred wholly outside of the U.S. and had no connection to the United States. (Id. at ¶ 6) (“Supreme Group entities had contracts to provide . . . goods to the NATO International Security Assistance Force in Afghanistan”) (emphasis added). Therefore, the existence of these contracts between Petitioner and SRM which have no connection to the forum state or any state in the United States are not a basis for establishing general jurisdiction over SRM. For these reasons, it would be a manifest injustice to hale SRM into this Court because no general jurisdiction exists over SRM. 2. THIS COURT LACKS SPECIFIC JURISDICTION OVER SRM It is similarly clear that this Court does not have specific jurisdiction over SRM. Specific jurisdiction is only proper where a respondent has “purposefully availed itself of the privilege of conducting activities in the [s]tate.” Consulting Eng’rs Corp., 561 F.3d at 278. Courts consider the following eight non-exclusive factors in determining whether a respondent has engaged in such purposeful availment: (1) whether the respondent maintains offices or agents in the forum state; (2) whether the respondent owns property in the forum state; (3) whether the respondent reached into the forum state to solicit or initiate business; (4) whether the respondent deliberately engaged in significant or long-term business activities in the forum state; (5) whether the parties contractually agreed that the law of the forum state would govern disputes; (6) whether the respondent made in-person contact with the resident of the forum in the forum state regarding the business relationship; (7) the nature, quality and extent of the parties’ communications about the business being transacted in the forum state; (8) whether the performance of contractual duties was to occur within the forum state. Id. Here, no specific jurisdiction exists because SRM does not satisfy any of the eight above- enumerated factors. First, SRM has its only place of business in the United Arab Emirates. (Norgaard Declar., ¶ 5). It has never had an office or physical presence of any kind in the Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 15 of 17 PageID# 371 12 Commonwealth of Virginia or anywhere else in the United States. (Id.). None of SRM’s directors, officers or employees lives or works in the district or anywhere else in the United States. (Id. at ¶ 6). SRM does not have and has never had a bank account or any other property in the district or anywhere else in the U.S. (id. at ¶ 7), and it does not have and never has had any sort of account with any financial institution in the United States. (Id.). SRM has not solicited, initiated, or conducted business in the district or anywhere else in the United States. (Id. at ¶ 8). SRM does not and has never deliberately engaged in significant or long-term business activities in the district or anywhere else in the United States. (Id. at ¶¶ 8, 9). Petitioner and SRM never contractually agreed that the law of the forum state would govern disputes. In fact, Petitioner concedes that “[a]ny dispute, difference, controversy, or claim of any kind whatsoever” that arose “between the Parties” was governed by and “exclusively and finally settled” under the rules of this state, but “under the Rules of the Dubai International Arbitration Centre”. (Petit., ¶ 13). SRM also never made in-person contact with residents of this state in this state regarding any business relationship. (Norgaard Decl. at ¶ 8). SRM did not communicate with Petitioner about business in the U.S. because SRM has never engaged in any business activities in the U.S. (Id. at ¶¶ 8, 9). Finally, the performance of contractual duties owed by Petitioner to SRM occurred not within the U.S., but overseas. (Petit., ¶ 10). Indeed, Petitioner was engaged by SRM to provide security services in Afghanistan not in the forum state or any other state in the U.S. (Id. at ¶ 1). Based upon these factors, this Court does not have specific jurisdiction over SRM because SRM has no contacts with the state of Virginia. V. CONCLUSION Relying on a baseless alter ego theory, CRM seeks to establish personal jurisdiction over SRM based on mostly overseas conduct that it attributes entirely to separate and independent Supreme Group B.V. subsidiaries. Indeed, despite the Petition’s comprehensive description of Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 16 of 17 PageID# 372 13 contacts and business activities that other subsidiary companies of Supreme Group B.V. purportedly have or have had with the U.S., the allegations of the Petition are completely lacking with respect to SRM’s involvement with any of these contacts or activities. There is not a single allegation in the Petition that SRM has or had any direct contact with the U.S. that would permit the Court to exercise personal jurisdiction over SRM. Given these deficiencies, the Petition fails to allege any facts to support personal jurisdiction over SRM, a foreign corporation that has no ties or contacts with the U.S., and that is not alleged to have directed any conduct towards the U.S. Consequently, the Petition should be dismissed pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure for lack of personal jurisdiction. Dated: April 19, 2017 By: /s/ Stacey Rufe Stacey Rufe (VA BAR No. 42737) Brian C. Dunning (pro hac admission to be requested) Raquel O. Alvarenga (pro hac admission to be requested) CLYDE & CO US LLP 1000 Potomac Street NW, 5th Floor Washington, D.C. 20007 +1 (202) 747 5100 (Tel.) +1 (202) 747 5150 (Fax) Attorneys for Respondent Supreme Risk Management FZE Case 1:16-cv-01344-AJT-MSN Document 23 Filed 04/19/17 Page 17 of 17 PageID# 373