Simplot India LLC v. Himalaya Food Int'l

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SIMPLOT INDIA LLC and SIMPLOT INDIA FOODS PVT. LTD., Petitioners, v. HIMALAYA FOOD INTERNATIONAL LTD, Respondent.

Civil Action No. 23-1612 (RK) (TJB)

United States District Court, D. New Jersey

March 14, 2024

OPINION

ROBERT KIRSCH, UNITED STATES DISTRICT JUDGE.

THIS MATTER comes before the Court on a Petition to Confirm, Recognize, and Enforce Foreign Arbitral Award the (“Petition”) filed by Petitioners Simplot India LLC and Simplot India Foods Pvt. Ltd., (ECF No. 1), as well as the Motion filed by Petitioners seeking the same relief (ECF No. 2). Also pending is the Cross-Motion to Stay or Dismiss filed by Respondent Himalaya Food International Ltd. (ECF No. 23.) The Singapore International Arbitration Center (“SIAC”) issued the award on May 8, 2020, and Petitioners now seek enforcement of the award in this District pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards.^[1] The Court has carefully considered the parties' submissions and decides the motions without oral argument pursuant to Federal Rule of Civil Procedure 78(b) and Local Civil Rule 78.1(b). For the reasons that follow, Petitioners' Motion to Confirm (ECF No. 2) is DENIED, Respondent's Cross-Motion to Stay or Dismiss (ECF No. 23) is DENIED in part and GRANTED in part, and the Petition to Enforce (ECF No. 1) is DISMISSED.

I. BACKGROUND^[2]

A. The Parties and their Underlying Dispute

Petitioners-Simplot India LLC and Simplot India Foods-are affiliates of J.R. Simplot Company, an Idaho-based agribusiness that produces and sells (mostly potato-based) food products domestically and internationally. (Award ¶¶ 1-3, 13.) Simplot India LLC is an Idaho limited liability company, and Simplot India Foods is an Indian company. (Id.) Respondent is an Indian company, listed on the Bombay Stock Exchange, that produces a variety of food products, including frozen potato products. (Id. ¶ 4.)

This matter arises out of the parties' joint venture in India. Simplot India LLC and Respondent entered into the Shareholders Agreement (“SA”) in 2011. (Award ¶ 6, 13-14.) Under the SA, the parties agreed to establish Himalaya Simplot Pvt Ltd (“HSPL”), a joint venture company incorporated in India. (Id. ¶ 14.) The SA provided that Respondent would produce the food products and subsequently sell them to HSPL at the parties' facility in India. (Id. ¶ 103.) HSPL would then act as the “exclusive sales agent” for the products, in which Simplot India LLC would provide “expertise and brand reputation” assistance. (Id.) Products to be sold by the joint venture included “frozen potato products, breaded and battered appetizers, and certain shelf stable products.” (Id. ¶ 105.)

The parties agree that issues quickly arose in the administration of the joint venture. (Id. ¶ 14.) In hopes of resolving these issues, the parties entered a second agreement in 2012-the Master Agreement (“MA”)-under which Petitioners bought some of Respondent's equipment and took over use of the facility in India to produce the potato products, in exchange for $12.75 million. (Id. ¶¶ 117-20.) The parties' relationship broke down again as disputes arose concerning the parties' obligations and performance under the MA, and Petitioners vacated the facility in March 2023. (Id. ¶¶ 144-49.)

B. Arbitration Proceedings

From 2013 to 2020, the parties vigorously litigated their disputes via arbitrations and court proceedings in Singapore and India. (See Award ¶¶ 19-83.) As relevant to the present dispute, Petitioners initiated an arbitration proceeding before a SIAC Tribunal in July 2017, based on a provision in the MA requiring binding arbitration before SIAC. (Id. ¶¶ 9, 17.) Petitioners alleged breaches of the MA related to, among other complaints, inadequacies of the production equipment Respondent provided and issues with Petitioners' use of the facility. (Id. ¶ 14.) The SIAC Tribunal conducted a final evidentiary hearing in this matter, which took place over eight days and included extensive submissions from experts and witness testimony. (Id. ¶¶ 64-68.)

The SIAC Tribunal issued its 209-page final award on March 24, 2020. (See generally Award.)^[3] The SIAC Tribunal found, in summary, that Respondent was in material breach of its obligations under the MA, as well as in breach of other clauses for which the Petitioners were awarded nominal damages. (Id. at *188-89.) SIAC awarded Petitioners $1,670,998 in damages and $674,814 in interest up to the date of the Award, (id.), as well as continuing interest on the Award at a rate of 5.33% per annum until paid, (Corrected Award ¶ 10). The SIAC Tribunal made explicit findings as to the conduct of each party throughout both SIAC arbitration proceedings and found the Petitioners were also entitled to “party costs” (including attorney's fees) and directed Respondent to bear 90% of the total arbitration costs. (Award ¶¶ 49, 307, 942-53, 955.)

Several months after the issuance of the Award, Petitioners filed a petition to enforce it before the High Court of Delhi. (Decl, of Ravinder Singhania (“Singhania Decl.”) ¶ 0, ECF No. 34-24.) Respondent objected to enforcement of the award on several grounds, (id. ¶ 1), and the parties continue to litigate those objections and other matters before the court in Delhi, (id. ¶¶ 23, 8-21.) Since the filing of the initial Petition and Cross-Motion to Stay or Dismiss, (ECF Nos. 1, 23), both parties have made clear that ongoing litigation relating to this matter is pending before the court in Delhi, (see ECF Nos. 38-42).

C. Respondent's New Jersey Ties

Petitioners filed their Petition in this District based on their belief that Respondent is subject to personal jurisdiction here and that this Court can confirm and enforce the Award. (Petition ¶¶ 6-9.) Petitioners' jurisdictional claims appear to be based in small part on Respondent's direct contacts with New Jersey but are grounded more fully in Respondent's relationship to a related but separate New Jersey corporate entity.

Respondent's website identifies its officers as ManMohan Malik (“Malik”), its founder, chairman, and CEO, and Sanjiv Kakicar (“Kakkar”), its co-founder and president. (Ex. 2 to Decl, of Edward T. Decker (“Decker Decl.”), ECF No. 34-3.) Malik and Kakicar also sit on Respondent's board of directors. (Id.) Respondent is registered to do business in New Jersey as a foreign profit corporation and designated Kalckar as its in-state agent for service of process. (Ex. 3 to Decker Decl., ECF No. 34-4.) Kakkar accepted service of process in this action on Respondent's behalf. (ECF No. 6.) Respondent lists “Himalaya International” and “Global Reliance” as associated names on its New Jersey registration. (Ex. 3 to Decker Decl.) As of March 23, 2023, its Business Report shows that Respondent has “dissolution/withdrawal” proceedings pending from New Jersey. (Id.) Respondent's website listed its United States sales office at an address in Hamilton, New Jersey, (Ex. 1 to Decker Decl., ECF No. 34-2), which is the same address listed on Respondent's New Jersey foreign profit corporate registration, (Ex. 3 to Decker Decl.).

Himalaya International Inc. (“Himalaya International”) is a New Jersey domestic profit corporation distinct from Respondent. (Ex. 4 to Decker Decl., ECF No. 34-5.) Like Respondent, Himalaya International registered to use the alternative names “Global Reliance” and “Himalaya Food International,” designated Kakkar as its agent for service of process, and listed the same Hamilton, New Jersey address as its business registration. (Id.) Himalaya International began the process to dissolve as a New Jersey corporation and re-establish itself in Wyoming, but the dissolution process remains pending. (Id.', Ex. 5 to Decker Decl, at *2-5.) It now maintains an office at an address in Princeton, New Jersey. (Decl, of Sanjiv Kakkar (“Kakkar Decl.”) ¶ 2, ECF No. 23-11.) Himalaya International maintains a bank account at PNC bank. (Id. ¶ 5.) In his declaration, Kakicar states that he is the CEO and sole shareholder of Himalaya International. (Id. ¶¶ 1, 3 .)^[4] Kakkar further states that Respondent has no ownership over Himalaya International and no control over or rights to Himalaya International's account at PNC bank. (Id. ¶¶ 3, 5.)

Regarding Respondent's business ties to Himalaya International, Kakkar characterizes it as a “buyer and seller” relationship. (Kakkar Decl. ¶ 4.) Kakkar declares that he is not aware of any “formal agreement” between the companies requiring Himalaya International to purchase food for distribution from Respondent alone. (Id.)

Petitioners performed a review of publicly available shipping records using variations of the name “Himalaya” for the periods August 1, 2021 to December 12, 2022 and June 1, 2022 to June 26, 2023. (See Decl, of Lawrence R. Pilon (“Pilon Decl.”), ECF No. 34-21.) Petitioners identify 175 ocean import shipments sent by Respondent during the first period to the consignee Global Reliance at either the Hamilton or Princeton addresses associated with Himalaya International. (Id. ¶¶ 8-9.) In the second period, the records show 58 ocean import shipments from Respondent, of which 56 list Global Reliance as the consignee at the Princeton address. (Id. ¶¶ 1011-)

D. Federal Procedural History

Petitioners filed their Petition and Motion to Enforce on March 21, 2023. (ECF Nos. 1,2.) On June 16, 2023, Respondent filed an Answer to the Petition, (ECF No. 22), as well as a Cross-Motion seeking relief on several grounds, (ECF No. 23). Respondent's Cross-Motion (1) opposed confirmation and enforcement of the Award and sought dismissal of the Petition on the grounds that the Court lacked personal jurisdiction over Respondent and that the Award was invalid under Indian Law, and (2) alternatively sought to...