Wag SPV I, LLC v. Fortune Global Shipping & Logistics, Ltd.

612 F.Supp.3d 321

WAG SPV I, LLC, Plaintiff,

v.FORTUNE GLOBAL SHIPPING & LOGISTICS, LTD.; Fortune Global Shipping & Logistics (USA), Inc.; and Eric Opah, Defendants.

19 Civ. 6207 (KPF)

United States District Court, S.D. New York.

Signed March 26, 2020

Filed March 27, 2020

Celinda Joan Metro, John G. Kissane, Watson, Farley & Williams, LLP, New York, NY, for Plaintiff.

James C. Winton, Erika Lindberg, Baker & Hostetler LLP, Houston, TX, Robertson Drake Beckerlegge, Baker & Hostetler LLP, New York, NY, for Defendants.

OPINION AND ORDER

KATHERINE POLK FAILLA, District Judge:

Plaintiff WAG SPV I, LLC brings this action against Defendants Fortune Global Shipping & Logistics, Ltd. ("FG Nigeria"), Fortune Global Shipping & Logistics (USA), Inc. ("FG USA"), and Eric Opah (collectively, "Defendants") for attachment of Defendants' assets in the Southern District of New York. Plaintiff alleges that Defendants have wrongfully arrested its vessel, SEA HORIZON, in the Republic of Ghana, and have failed to post any security for that arrest despite an order to do so from a court in Ghana. Plaintiff has obtained — and seeks to maintain — its attachment of Defendants' assets as security for the Ghana court's order and Plaintiff's own wrongful arrest claim. Defendants have moved pursuant to Federal Rule of Civil Procedure Supplemental Rule E(4)(f) to vacate this Court's prior Order of Maritime Attachment and Garnishment or, in the alternative, transfer this action to the Southern District of Texas. For the reasons set forth in the remainder of this Opinion, Defendants' motion to vacate is granted, and its motion to transfer is denied as moot.

BACKGROUND

A. Factual Background¹

1. The Parties

Plaintiff is a Texas limited liability company based in Dallas, Texas, and is the current owner of the heavy lift pipe-laying vessel DLB SEA HORIZON ("SEA HORIZON"). (SAVC ¶ 2). Plaintiff purchased SEA HORIZON on or about November 22, 2016. (Id. at ¶ 7). Defendant FG Nigeria is a Nigerian company based in Lagos State, Nigeria, while FG USA is a Texas corporation based in Houston, Texas. (Id. at ¶¶ 3-4). Defendant Opah resides in Humble, Texas, and is the President, CEO, Director, and Founder of both FG Nigeria and FG USA. (Id. at ¶ 5). Plaintiff alleges that FG Nigeria and FG USA share common ownership, common directors, a single website, and a common LinkedIn page. (Id. at ¶¶ 44-45).

2. FG Nigeria's Ghana Proceedings

On or about September 18, 2018, FG Nigeria filed an ex parte application in Ghana (the "Ghana Action") for the arrest and detention of SEA HORIZON. (SAVC ¶ 8). In it, FG Nigeria alleged that Ranger Subsea Nigeria Limited ("RSNL"), a Nigerian company operating out of Houston, Texas, was indebted to it for approximately $1.9 million under the terms of a Master Service Agreement ("MSA"). (Id. at ¶¶ 9-10). In order to recover its debt, FG Nigeria brought the Ghana Action against, inter alia , RSNL, Plaintiff, and SEA HORIZON, contending that RSNL, Plaintiff, and other entities were joint owners of SEA HORIZON and thus jointly and severally liable for RSNL's debt. (Id. at ¶ 13). This is so despite the facts that (i) the MSA mentions neither Plaintiff nor SEA HORIZON, and (ii) according to Plaintiff, FG Nigeria never performed work for the benefit of Plaintiff or SEA HORIZON. (Id. at ¶ 11). RSNL likewise never contracted with FG Nigeria on Plaintiff's behalf. (Id. ).

On September 20, 2018, the Ghana court issued an order for SEA HORIZON's arrest. (SAVC ¶ 14). In October 2018, Plaintiff moved the Ghana court to set aside the order arresting SEA HORIZON, claiming that Plaintiff and SEA HORIZON had no dealings with FG Nigeria. (Id. at ¶ 15; see also id. , Ex. 3 at 4-9). The Ghana court refused to vacate the order. (Id. at ¶ 17).

On January 25, 2019, Plaintiff requested that the Ghana court order FG Nigeria to post a security for any costs for which it may potentially be liable. (SAVC ¶ 25). Plaintiff also applied for an order requiring FG Nigeria to provide documents or evidence supporting its claims against SEA HORIZON. (Id. at ¶ 20). In response, the Ghana court issued an order on February 28, 2019, requiring FG Nigeria to provide "Further and Better particulars together with the invoices, receipts[,] and other documents in relation to [FG Nigeria's] claims" by March 14, 2019. (Id. at ¶¶ 20-21). The Ghana court also ordered FG Nigeria to post a security of $400,000. (Id. at ¶ 26).

FG Nigeria did not respond to the Ghana court's order regarding submitting further evidence in support of its claims until April 26, 2019, at which time it filed a supplementary affidavit. (SAVC ¶ 22). By that time, SEA HORIZON had applied to the Ghana court for release. (Id. at ¶ 23). On May 3, 2019, SEA HORIZON filed a supplementary affidavit in support of its release, noting that a review of FG Nigeria's supplementary affidavit indicated that FG Nigeria had provided approximately $55,000 in services to SEA HORIZON. (Id. at ¶ 24). That amount was far lower than the almost $2 million that FG Nigeria claimed in damages. (Id. at ¶¶ 10, 24). In regards to the Ghana court's order that FG Nigeria post a $400,000 security, FG Nigeria has yet to comply. (Id. at ¶ 27).

On May 24, 2019, the Ghana court ordered that SEA HORIZON be released. (SAVC ¶ 28). However, FG Nigeria applied for a stay of execution of the release order. (Id. ). When that application was denied, FG Nigeria appealed the denial. (Id. ). On July 8, 2019, the appeals court in Ghana dismissed FG Nigeria's appeal. (Id. ).

3. The Other Ghana Proceedings

On or about May 30, 2019 — subsequent to the original Ghana court's order that SEA HORIZON be released — SJ Abed General Enterprises Ltd. ("SJ Abed"), a Nigerian entity, filed for an order of arrest and detention against SEA HORIZON in a different court in Ghana. (SVAC ¶¶ 33-34). Like FG Nigeria, SJ Abed claimed to be owed money for services provided pursuant to a Master Services Agreement. (Id. at ¶ 36). On or about June 27, 2019, Hercules Marine Limited ("Hercules Marine"), another Nigerian entity, filed an order of arrest and detention against SEA HORIZON in a third, different court in Ghana. (Id. at ¶¶ 39-40). Hercules Marine also claimed to be owed money under a Master Services Agreement. (Id. at ¶ 41). In all three arrest actions, the three applicants — FG Nigeria, SJ Abed, and Hercules Marine — were represented by Dr. Kofi Mbiah, a solicitor with Alliance Partners. (Id. at ¶¶ 30, 35, 41).

Plaintiff alleges that Defendants, with the assistance of Dr. Mbiah, "have orchestrated the SJ Abed and Hercules Marine arrest actions in a malicious and bad faith attempt to deplete Plaintiff's resources, with reckless disregard for Plaintiff's legal rights." (SAVC ¶ 43). Plaintiff claims that, because of SEA HORIZON's arrest, it has been unable to sell, employ, or charter its vessel, losing thousands of dollars per day. (Id. at ¶ 54). Additionally, Plaintiff has incurred port fees and other expenses at a rate of approximately $250,000 per month. (Id. ). At the time of the SAVC, Plaintiff believed that it had incurred not less than $2.5 million in damages, exclusive of interest, costs, and attorney's fees. (Id. ).

4. The Texas Proceedings

On May 6, 2019, Plaintiff filed suit against Defendants in the Southern District of Texas, asserting a claim under Supplemental Rule D. (WAG SPV I, LLC v. Fortune Global Shipping & Logistics (USA), Inc. , No. 4:19-cv-1653 (S.D. Tx.), Dkt. #1).² The complaint in that case alleged much the same facts, and asked the Texas court, pursuant to Supplemental Rule D, to issue a judgment both declaring Plaintiff to be the sole owner of SEA HORIZON and awarding Plaintiff at least $4.2 million in damages. (Dkt. #1 (original complaint); Dkt. #4 (amended complaint filed May 24, 2019)). On June 21, 2019, Defendants moved to dismiss Plaintiff's complaint under Rule 12(b)(1), for lack of subject matter jurisdiction, and under Rule 12(b)(2), for lack of personal jurisdiction over FG Nigeria. (Dkt. #7). Plaintiff amended its complaint a second time on July 29, 2019 (Dkt. #19), and Defendants answered on August 9, 2019 (Dkt. #27). Defendants' answer contained a number of affirmative defenses, including lack of subject matter jurisdiction, lack of personal jurisdiction over FG Nigeria, and forum non conveniens. (Dkt. #27). On February 17, 2020, at Plaintiff's instigation, the parties stipulated to a voluntary dismissal without prejudice of the action in Texas. (Dkt. #59). The Texas action was dismissed the following day, on February 18, 2020. (Dkt. #60).

B. Procedural Background

Plaintiff initiated the instant action on July 3, 2019, with the filing of a complaint seeking attachment pursuant to Supplemental Rule B. (Dkt. #1). That same day, the Court issued an Order directing the Clerk of Court to issue process of maritime attachment and garnishment against all tangible and intangible property belonging to Defendants at Deutsche Bank, Standard New York, Inc., and Wells Fargo Bank N.A., up to the amount of $2.9 million. (Dkt. #3). On July 10, 2019, Plaintiff filed a first amended complaint (Dkt. #7), in response to which the Court issued a second order of attachment and garnishment (Dkt. #11). On July 17, 2019, the Court issued a third order of attachment and garnishment, this time noting that "any person claiming an interest in any property attached or garnished ... shall ... be entitled to a prompt hearing at which the Plaintiff shall be required to show why the attachment and garnishment should not be vacated." (Dkt. #14). On July 19, 2019, Plaintiff asked the Court for leave to file a second amended complaint (Dkt. #15), which the Court granted the same day (Dkt. #16). Plaintiff filed its second amended complaint on July 19, 2019. (Dkt. #32).

On July 22, 2019, the Court scheduled an initial pretrial conference for October 17, 2019. (Dkt. #17). However, on July 24, 2019, Defendants filed letters with the Court requesting leave to file motions to vacate the...