Mount Whitney Invs., LLLP v. Goldman Morgenstern & Partners Consulting, LLC

In the Matter of the Application of MOUNT WHITNEY INVESTMENTS, LLLP,a Nevada limited-liability limited partnership, Plaintiff, v. GOLDMAN MORGENSTERN & PARTNERS CONSULTING, LLC d/b/aGOMOPA, a New York limited liability company; MANFRED RITTER,an individual; STEFAN ELSTERMANN, an individual; THOMAS SCHULTE,an individual; DOES 1-10; and ROES 1-10, Defendants.

15 Civ. 4479 (ER)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

May 2, 2016

OPINION AND ORDER

Ramos, D.J.:

Plaintiff Mount Whitney Investments, LLLP ("MWI" or "Plaintiff") brings this suit against Goldman Morgenstern & Partners Consulting, LLC d/b/a GoMoPa ("GoMoPa"), as well as individual defendants Manfred Ritter ("Ritter"), Stefan Elstermann ("Elstermann"), and attorney Thomas Schulte ("Schulte") (collectively "Defendants"), alleging defamation, violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), tortious interference with contract, tortious interference with business relations/economic advantage, and breach of contract. Presently before the Court is Defendant GoMoPa's motion to dismiss on forum non conveniens grounds. For the reasons set forth below, Defendant GoMoPa's motion is DENIED.

I. Background

a. The Parties

Plaintiff MWI is a limited-liability limited partnership, formed under the laws of Nevada. Compl. ¶ 8 (Doc. No. 2). MWI's principal manager is Volker Tabaczek ("Tabaczek"), a resident of Germany. Id. at ¶ 22; Compl. Ex. 7. Defendant GoMoPa is a limited liability company formed under the laws of New York. Compl. ¶ 9. Defendants Ritter, Elstermann, and Schulte are residents of Germany. Compl. ¶ 10-12.

b. Factual Background¹

Plaintiff alleges that in 2014 and early 2015, Defendants engaged in a coordinated scheme intended to extort money from Plaintiff. According to Plaintiff, in 2014 MWI entered into contracts with Defendants Ritter and Elstermann, in which Ritter and Elsterman agreed to provide MWI with certain financial services in exchange for commission payments.² Compl. ¶¶ 14, 17. MWI paid Ritter and Elstermann advanced commissions totaling close to thirty thousand dollars. Id. at ¶¶ 16, 19. Subsequently, MWI learned that neither Elstermann nor Ritter possessed the licenses or permits necessary to fulfill their duties under the contracts. Id. at ¶ 20. MWI maintains that Elstermann and Ritter lied about their qualifications in order to obtain the advanced commissions. Id.

Plaintiff further claims that on October 17, 2014, Defendant Schulte, on behalf of his client Defendant Ritter, called for an in-person meeting with MWI's principal manager, Tabaczek, in which Schulte demanded that MWI pay Ritter thirty thousand euros. Id. at ¶ 22.Schulte informed Tabaczek that if he failed to pay Ritter, Defendants Ritter and Elstermann would use an online platform, owned through Defendant GoMoPa, to launch a smear campaign against Plaintiff.³ Id. Tabaczek ultimately refused to pay Ritter. Id. at ¶ 23.

In December 2014, Plaintiff alleges that Defendant Ritter began emailing MWI's business associate, Michael Rudolf. Compl. ¶ 24. Plaintiff claims that the emails were hostile towards Rudolf and made a number of false and baseless statements about MWI and Tabaczek, including accusations that MWI and Tabaczek were, inter alia: (i) engaging in fraud and violating of SEC regulations; (ii) violating investor agreements; (iii) intentionally causing investments in the U.S.to "disappear"; and (iv) destroying evidence regarding investments. Id. at ¶ 24-25. Plaintiff maintains that the emails also threatened "unwarranted legal action" against MWI. Id. at ¶ 29.

Between December 2014 and February 2015, Plaintiff claims that Defendant Elstermann published articles on Defendant GoMoPa's website containing defamatory statements against MWI, MWI's business associates, Tabaczek, and Tabaczek's wife.⁴ Id. at ¶ 30; Id. at ¶¶ 34-35; see Compl. Exs. 7, 9. Elstermann also allegedly threatened to file baseless complaints of fraud and other wrongful acts against MWI and Tabaczek with various regulatory authorities. Id. at ¶ 31. Moreover, Plaintiff claims Elstermann and Ritter encouraged their clients to file similar complaints against Tabaczek and his wife. Id. at ¶ 32.

In addition to finding these accusations in articles on GoMoPa's website, MWI discovered another website, "criminals.cc" reiterating many of the same accusations. Id. at ¶ 46. MWI maintains Defendants are also responsible for the accusations on criminals.cc. Id. at ¶ 47.⁵

Finally, MWI claims that Defendants are responsible for sending unsolicited communications to MWI's employees and prospective clients in order to damage MWI's reputation and hinder its business ventures. Compl. ¶¶ 52-54. Some of the messages allegedly mischaracterized a 2008 German court decision, "to falsely portray Mr. Tabaczek as having been convicted of fraud and portray Mr. Tabaczek in a false light to investors and other business associates[.]" Id. at ¶¶ 51, 52-55. Plaintiff claims Defendants' conduct resulted in MWI losing a five million dollar investment. Id. at ¶¶ 56.

Plaintiff asserts that Defendants' alleged wrongdoings are part of "an ongoing operation of extorting money from business professionals by publishing false and defamatory content, then offering to remove the subject content in exchange for money payoffs[.]" Id. at ¶ 33. Defendant GoMoPa now moves to dismiss Plaintiff's claims on forum non conveniens grounds.⁶ Def. GoMoPa's Mot. to Dismiss (Doc. No. 58). GoMoPa argues that Germany would be a more appropriate forum. See Def. GoMoPa's Mem. of Law in Supp. at 2 (Doc. No. 60).

II. Legal Standard

The doctrine of forum non conveniens allows a court to dismiss an action "even if the court is a permissible venue with proper jurisdiction over the claim." LaSala v. Bank of Cyprus Pub. Co. Ltd., 510 F. Supp. 2d 246, 254 (S.D.N.Y. 2007) (quoting Carey v. Bayerische Hypo-und Vereinsbank AG, 370 F.3d 234, 237 (2d Cir. 2004)). "A decision to grant or deny a motion to dismiss a cause of action under the doctrine of forum non conveniens lies wholly within the broad discretion of the district court." Scottish Air Int'l, Inc. v. British Caledonian Grp., PLC, 81 F.3d 1224, 1232 (2d Cir. 1996). The Second Circuit has "outlined a three-step process to guide the exercise of that discretion." Norex Petroleum Ltd. v. Access Indus., Inc, 416 F.3d 146, 153 (2d. Cir. 2005) (citing Iragorri v. United Tech. Corp., 274 F.3d 65, 73 (2d Cir. 2001) (en banc)). First, "a court determines the degree of deference properly accorded the plaintiff's choice of forum." Id. Second, "it considers whether the alternative forum proposed by the defendants is adequate to adjudicate the parties' dispute." Id. And third, "a court balances the private and public interests implicated in the choice of forum." Id.

III. Discussion

a. Degree of Deference to MWI's Choice of Forum

A Defendant who invokes forum non conveniens generally bears "a heavy burden" in opposing plaintiff's chosen forum. Sinochem Int'l. Co. Ltd. v. Malaysia Int'l Shipping Corp., 549 U.S. 422, 430 (2007). When reviewing a forum non conveniens motion, courts start with "a strong presumption" in favor of the plaintiff's forum choice. Norex, 416 F.3d at 154 (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255 (1981)). In applying this presumption, however, "'the degree of deference to be given to a plaintiff's choice of forum moves on a sliding scale' depending on the convenience reflected by the given choice." Palacios, 757 F. Supp. 2d at 352, (quoting Iragorri, 274 F.3d at 71). The Second Circuit in Iragorri explains the sliding-scale analysis:

[T]he greater the plaintiff's or the lawsuit's bona fide connection to the United States and to the forum of choice and the more it appears that considerations of convenience favor the conduct of the lawsuit in the United States, the more difficult it will be for thedefendant to gain dismissal for forum non conveniens. . . . On the other hand, the more it appears that the plaintiff's choice of a U.S. forum was motivated by forum-shopping reasons . . . the less deference the plaintiff's choice commands[.]

Iragorri, 274 F.3d at 71-72. In short, courts give greater deference to a plaintiff's chosen forum when that choice is motivated by convenience and give less deference when the plaintiff is merely seeking a tactical advantage. When undergoing this sliding-scale analysis, courts are guided by Iragorri's convenience and forum shopping factors. Norex, 416 F.3d at 154-55.

Iragorri's convenience factors are: "[1] the convenience of the plaintiff's residence in relation to the chosen forum, [2] the availability of witnesses or evidence to the forum district, [3] the defendant's amenability to suit in the forum district, [4] the availability of appropriate legal assistance, and [5] other reasons relating to convenience or expense." Norex, 416 F.3d at 155 (quoting Iragorri, 274 F.3d at 72). Conversely, Iragorri's forum shopping factors are: "[1] attempts to win a tactical advantage resulting from local laws that favor the plaintiff's case, [2] the habitual generosity of juries in the United States or in the forum district, [3] the plaintiff's popularity or the defendant's unpopularity in the region, or [4] the inconvenience and expense to the defendant resulting from litigation in that forum." Norex, 416 F.3d at 155 (quoting Iragorri, 274 F.3d at 72).

Here, GoMoPa acknowledges that a plaintiff's forum choice is ordinarily owed deference, but argues that "no deference is due when none of the operative facts occurred in the plaintiff's chosen venue." Def. GoMoPa's Mem. of law in Supp. at 3 (citing Norex, 416 F.3d 146). However, GoMoPa's argument mischaracterizes Second Circuit case law. In fact, Norex, the case GoMoPa cites for this argument, explicitly held that courts must consider the totality of circumstances in determining how much deference to give a plaintiff's forum choice. 416 F.3d at 154. Moreover, in Iragorri itself the Second...