Reply S.P.A. v. Sensoria, Inc.

REPLY S.P.A., Plaintiff, v. SENSORIA, INC., et al., Defendants.

CASE NO. C19-0450-JCC

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE

July 30, 2019

THE HONORABLE JOHN C. COUGHENOUR

ORDER

This matter comes before the Court on Defendants' motion to dismiss or, in the alternative, to transfer (Dkt. No. 22). Having thoroughly considered the parties' briefing and the relevant record, the Court hereby GRANTS the motion in part and DENIES the motion in part, for the reasons explained herein.

I. BACKGROUND

On July 18, 2014, Plaintiff Reply S.P.A. purchased a majority share of stock in Defendant Sensoria, Inc. ("Sensoria"). (Dkt. No. 1 at 2.) The purchase was made pursuant to a purchase agreement signed by the parties (the "Purchase Agreement"). (Id. at 2-3.) The Purchase Agreement includes a governing law provision, which states:

The parties agree that any action brought by either party under or in relation to this agreement, including without limitation to interpret or enforce any provision of this agreement, shall be brought in, and each party agrees to, and does hereby submit to the jurisdiction and venue of, any state court located in Wilmington, Delaware or any federal court located in the district of Delaware.

(the "Delaware Forum Selection Clause"). (Dkt. No. 1 at 38.)

In March 2016, Plaintiff executed an infragroup financing contract with Defendant Davide Vigano, who negotiated the contract on behalf of Sensoria (the "March 2016 Contract"). (Id. at 3.) Vigano is a board member of Sensoria. (Id. at 5.) Pursuant to that contract, Plaintiff agreed to lend Sensoria 230,000 euros. (Id.) In October 2016, Plaintiff executed another infragroup financing contract with Vigano (the "October 2016 Contract"). (Id.) Pursuant to the October 2016 Contract, Plaintiff agreed to lend Sensoria another 1,000,000 euros. (Id.) The October 2016 Contract was later amended to reduce the amount to $1,075,000. (Id.) Both the March 2016 Contract and the October 2016 Contract (collectively, the "Loan Agreements") contain identical governing law provisions, which state:

8.1 This contract is governed by Italian Law.

8.2 All disputes arising from the execution or interpretation of this Contract shall be subject to the exclusive jurisdiction of the Law Courts of Turin, leaving untouched the entitlement for the Lender alone to have resort to whatsoever other judicial authority which may be appropriate.

(the "Italy Forum Selection Clause"). (Dkt. No. 22 at 4.)

In July 2017, Sensoria granted an exclusive license of all of its authored work and intellectual property (the "Assets") to Defendant Sensoria Holdings LTD ("Sensoria Holdings"). (Dkt. No. 1 at 4-5.) Defendant Maurizio Macagno, a board member of Sensoria, negotiated the agreement on behalf of Sensoria. (Id. at 4.) Plaintiff alleges that the Assets were worth approximately $20,000,000. (Id.) Sensoria Holdings purchased the exclusive licensing rights to the Assets for $247,000. (Id.) The transfer of the Assets also triggered Sensoria's liquidation, in accordance with its Certification of Incorporation. (Id.)

Plaintiff brings the following claims: breach of contract against Sensoria for its failure to pay its debts, in violation of the Loan Agreements ("Count One"); breach of contract against Sensoria for its failure to allow a vote on the transfer of the Assets, in violation of the Purchase Agreement ("Count Two"); unjust enrichment as an alternative to Counts One and Two ("CountThree"); fraudulent transfer against Sensoria and Sensoria Holdings, in violation of the Uniform Voidable Transaction Act, Wash. Rev. Code § 19.40 ("Count Four"); breach of fiduciary duty against Defendants Macagno and Vigano ("Count Five"); gross mismanagement against Defendants Macagno and Vigano ("Count Six"); and corporate waste against Defendants Macagno and Vigano ("Count Seven"). (Id. at 7-12.) Defendants move to dismiss Plaintiff's claims on the grounds of subject matter jurisdiction, improper venue, and forum non conveniens or, in the alternative, to transfer venue. (Dkt. No. 22.)

II. DISCUSSION

A. Subject Matter Jurisdiction

Under Federal Rule of Civil Procedure 12(b)(1), a defendant may move for dismissal if the Court lacks subject matter jurisdiction over the claims at issue. Fed. R. Civ. P. 12(b)(1). "Federal courts are courts of limited jurisdiction, possessing 'only that power authorized by Constitution and statute.'" Gunn v. Minton, 133 S.Ct. 1059 (2013) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). Thus, the Court may only entertain this action if there is either diversity or federal question jurisdiction. See 28 U.S.C. §§ 1331-32. The Court has jurisdiction over cases premised on diversity jurisdiction only where the parties are completely diverse and the amount in controversy exceeds $75,000. 28 U.S.C. § 1332.

Plaintiff asserts that the Court has diversity jurisdiction over its claims against each Defendant. (Dkt. No. 1 at 2.) Plaintiff is a foreign corporation headquartered in Turin, Italy. (Id.) Defendants Macagno and Vigano are residents of Washington. (Id.) Sensoria is incorporated in Delaware and has its principal place of business in Washington. (Id.) Sensoria Holdings is a limited liability company, with all partners residing in Washington. (Id.) Therefore, Sensoria Holdings is a resident of Washington. See Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). Therefore, because Plaintiff is diverse from all Defendants, complete diversity exists. See 28 U.S.C. 1332(a)(2); see also Sinotrans Container Lines Co., Ltd. v. N. China Cargo Servs., 380 F. App'x 588, 590 (9th Cir. 2010). The total amount in controversy inthis case exceeds $75,000. (See Dkt. No. 1.) Therefore, the Court has diversity jurisdiction over Plaintiff's claims. Defendants' motion to dismiss for lack of subject matter jurisdiction is DENIED.

B. Venue

A defendant may move for dismissal under Federal Rule of Civil Procedure 12(b)(3) if the case is filed in a federal district where venue is not proper. Venue is proper in a judicial district in which any defendant resides, if all defendants are residents of the state in which the district is located. 28 U.S.C. § 1391(b)(1).

Plaintiff asserts that venue is proper in the Western District of Washington because all Defendants are residents of Washington. Defendants Macagno and Vigano are residents of Washington. (Dkt. No. 1 at 2.) Sensoria is incorporated in Delaware and has its principal place of business in Washington; therefore, it is a citizen of both Delaware and Washington. 28 U.S.C. § 1332(c)(1); (Dkt. No. 1 at 2). Sensoria Holdings is a limited liability company, with all of its members residing in Washington. (Dkt. No. 1 at 2.) Therefore, Sensoria Holdings is a resident of Washington. See Johnson, 437 F.3d at 899. The Court finds that all Defendants are residents of Washington, and therefore, venue is proper in the Western District of Washington. Defendants' motion to dismiss for improper venue is DENIED.

C. Forum Non Conveniens

When an alternative forum has jurisdiction to hear the case, and when trial in the plaintiff's chosen forum would "establish . . . oppressiveness and vexation to a defendant . . . out of all proportion to plaintiff's convenience," or when the "chosen forum [is] inappropriate because of considerations affecting the court's own administrative and legal problems," the Court may, in the exercise of its sound discretion, dismiss the case on forum non conveniens grounds. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 (1981) (quoting Koster v. (Am.) Lumbermens Mut. Casualty Co., 330 U.S. 518, 524 (1947)). A party moving to dismiss on the grounds of forum non conveniens must show: (1) that the balance of private and public interestfactors favors dismissal; and (2) the existence of an adequate alternative forum. Loya v. Starwood Hotels & Resorts Worldwide, Inc., 583 F.3d 656, 664 (9th Cir. 2009). This showing must overcome the great deference given to the plaintiff's forum selection. See id.

The private factors the Court considers are: (1) access to sources of proof; (2) the availability of witnesses; and (3) enforceability of a judgment. Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508-09 (1947). The public factors the Court considers are: (1) whether the trial will involve multiple sets of laws; (2) selecting juries who may have a connection to the case; (3) local interest in having local disputes heard at home; and (4) in diversity cases, having the trial in a forum that is at home with the state law that must govern the case. Id.

When the Court is presented with a valid forum selection clause between the parties, the forum non conveniens analysis is altered. Atl. Marine Const. Co., Inc. v. U.S. Dist. Court for W. Dist. of Tex., 571 U.S. 49, 49-50, 61 (2013). Under the altered analysis, the Court will deem the private factors to weigh entirely in favor of dismissal and will only consider public interest factors weighing against dismissal. Id. In order to grant a motion to dismiss under forum non conveniens, the moving party must also show that the transferee court is an adequate alternative forum—one in which the case could have been brought. Id.

1. Count One

The contracts at issue in Count One, the Loan Agreements, contain the Italy Forum Selection Clause, which states:

8.1 This contract is governed by Italian Law.

8.2 All disputes arising from the execution or interpretation of this Contract shall be subject to the exclusive jurisdiction of the Law Courts of Turin, leaving untouched the entitlement for the Lender alone to have resort to whatsoever other judicial authority which may be appropriate.

(Dkt. No. 1 at 125-26.) Enforcement of a forum selection clause necessarily entails interpretation of the clause before it can be enforced. Manetti-Farrow, Inc. v. Gucci Am., Inc., 858 F.2d 509, 513 (9th Cir. 1988). Defendants argue that Count One should be dismissed because the first partof...