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OVERSEAS PTNRS., INC. v. PROGEN MUSAVIRLIK VE YONE

July 28, 1998

OVERSEAS PARTNERS, INC., Plaintiff,
v.
PROGEN MUSAVIRLIK VE YONETIM HIZMETLERI, LTD. SIKERTI, NECMETTIN OZTEMIR, MUAMMER AGIM, GUMUSSUYU HALI SANAYI VE TICARET A.S., SEDA GENGORU, MERAL AGIM, M. ONUR AGIM, and GAMZE OZOGUZ, Defendants.



The opinion of the court was delivered by: HARRIS

OPINION

 Before the Court are defendants' amended renewed motion to dismiss for lack of personal jurisdiction, insufficient service of process, and forum non conveniens, and related pleadings. *fn1" After careful consideration of the entire record; the Court finds that it has jurisdiction over defendants PROGEN Musavirlik ve Yonetim Hizmetleri, Ltd. Sikerti and Necmettin Oztemir, but concludes that the instant action should be dismissed on forum non conveniens grounds as to those defendants. *fn2" As to the other defendants, the case is dismissed for lack of personal jurisdiction.

 BACKGROUND

 Plaintiff Overseas Partners, Inc. ("OPI"), is a Delaware corporation headquartered in the District of Columbia ("the District"). OPI describes itself as a company that specializes in developing complex real estate projects in the countries of the former Soviet Union as well as other developing countries such as Turkey. Am. Compl. P 13.

 OPI alleges that PROGEN Musavirlik ve Yonetim Hizmetleri, Limited Sikerti ("PROGEN"), a Turkish limited liability company, Necmettin Oztemir, Muammer Agim, Gumussuyu Hali Sonayi Ticaret A.S. ("Gumussuyu"), Seda Gengoru, Meral Agim, M. Onur Agim, and Gamze Ozoguz (collectively, "defendants") breached a contract with OPI, that defendants were unjustly enriched at the expense of plaintiff as the result of the breach, and that defendants misrepresented their intentions to fulfill their part of the contract. Am. Compl. PP 36-53. The alleged breach concerns the parties' failed attempt to develop an office, residential, and shopping center complex in Istanbul, Turkey, known as "MetroCity."

 The relationship between the two companies began in 1995 when OPI's president, Sahir Erozan, while on business in Turkey, met Savci Eker, PROGEN's project manager. After a series of meetings and negotiations, both in the District and in Turkey, the parties signed a contract, known as "the Protocol," on December 15, 1995. Id. PP 15-18. The Protocol included a forum-selection clause providing that "any conflict arising between the Parties as a result of this Protocol shall be resolved by the Istanbul, Sultanahmet Court and Directorates of Execution according to the laws of the Republic of Turkey." See Protocol § 6.

 Although neither party disputes the Protocol's validity as a contract or that the language is clear, the parties differ regarding the breadth of its overall scope, as well as the interpretation of several key clauses. Plaintiff contends that the parties agreed to a multi-phase agreement and that the Protocol contained the specific terms for only the first phase agreement. Plaintiff asserts that phase one, which was the subject matter of the Protocol, was never breached, and therefore the Protocol is irrelevant to the dispute at hand. Plaintiff claims that on March 2, 1996, the next phase of the agreement was signed and executed, and that this second phase agreement was breached and constitutes the subject matter of this suit. See Am. Compl. P 18. Defendants counter that the Protocol was the only contract formed and that it covers the conduct at issue in this suit. Defendants contend that the document cited by plaintiff as the phase two agreement is nothing more than a signed copy of notes taken at a meeting and is not evidence of the formation of an additional contract.

 Plaintiff also asserts that, even if the Protocol were to apply to the conduct at issue here, the choice-of-law and forum-selection clause is unenforceable because it is the product of duress. Plaintiff contends that the choice-of-law and forum-selection clause was not ever negotiated but was added later during a payment dispute, and that this constitutes duress. Defendants counter that plaintiff has failed to allege facts which, even if true, could constitute duress, and contend that the clause is enforceable.

 ANALYSIS

 I. Lack of Service

 Defendants first argue that the Court should dismiss this case with respect to all defendants except Oztemir because they were never served with a summons and a copy of the complaint as required by Federal Rule of Civil Procedure 4. Although the 120-day time limit established by Rule 4(m) does not apply to foreign service of process, court generally apply a "flexible due diligence" standard for determining whether service of process on a foreign defendant was timely. See, e.g., James v. Rutil (S.R.L.), 1997 U.S. Dist. LEXIS 4029, 1997 WL 151174 at *5 (S.D. Ind. 1997); Standard Commercial Tobacco Co. v. Mediterranean Shipping Co., S.A., 1995 U.S. Dist. LEXIS 18877, 1995 WL 753901 at *1 (S.D.N.Y. 1995); In re Crysen/Montenay Energy Co., 166 B.R. 546, 552 (S.D.N.Y. 1994). Defendants contend that plaintiff has not met even this generous standard, since this case has been pending for more than a year and a half.

 Plaintiff, however, argues that defendants have waived any defense they may have had based on insufficiency of service of process because defendants did not raise the issue in their first Rule 12 motion. See Fed. R. Civ. P. 12(h)(1). Defendants counter that they have not waived their objections to plaintiff's failure to serve in a diligent manner because such an objection was not available to them at the time their first motion to dismiss was filed. See Fed. R. Civ. P. 12(g); Chatman-Bey v. Thornburgh, 274 U.S. App. D.C. 398, 864 F.2d 804, 813 n.8 (D.C. Cir. 1988); Glater v. Eli Lilly & Co., 712 F.2d 735, 738 (1st Cir. 1983). In light of this Circuit's strong preference for decisions on the merits of an action rather than on procedural grounds, see Trakas v. Quality Brands, Inc., 245 U.S. App. D.C. 165, 759 F.2d 185, 189 (D.C. Cir. 1985), the Court determines that defendants have waived any objection they may have had to service of process. Although the Court acknowledges that any objection to plaintiff's failure to serve defendants in a diligent manner was not available at the time defendants filed their first Rule 12 motion, that defense certainly came "available" in the past year. Defendants' failure to amend their motion once the defense of insufficient service of process became "available" thus constituted a waiver of that defense. *fn3"

 II. Personal Jurisdiction

 It is well-established that a court may not consider a forum non conveniens motion unless it has personal jurisdiction over the parties. See Allstate Life Ins. Co. v. Linter Grp. Ltd., 782 F. Supp. 215, 219 (S.D.N.Y. 1992) (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 504, 91 L. Ed. 1055, 67 S. Ct. 839 (1947)); Wright, Miller & Cooper, Federal Practice and Procedure 2d, Jurisdiction § 3828 (1986). Accordingly, the Court next considers defendants' jurisdictional objections. See Allstate Life Ins., 782 F. Supp. at 219; see also Syndicate 420 at Lloyd's London v. Early Amer. Ins. Co., 796 F.2d 821, 826 n.8 (5th Cir. 1986); Thomson Info. Servs. Inc. v. British Telecommunications, PLC, 940 F. Supp. 20, 22 & n.2 (D. Mass. 1996).

 District of Columbia law controls the jurisdiction of this Court over a nonresident defendant. See Crane v. Carr, 259 U.S. App. D.C. 229, 814 F.2d 758, 762 (D.C. Cir. 1987). A plaintiff need only present a prima facie case that personal jurisdiction exists in order to survive a motion to dismiss for lack of personal jurisdiction. See Crane v. New York Zoological Society, 282 U.S. App. D.C. 295, 894 F.2d 454, 456 (D.C. Cir. 1990). This prima facie requirement must, however, be met with respect to each defendant individually. See First Chicago Int'l v. United Exchange Co., 267 U.S. App. D.C. 27, 836 F.2d 1375, 1378 (D.C. Cir. 1988); Schwartz v. CDI Japan, Ltd., 938 F. Supp. 1, 4 (D.D.C. 1996). The Court thus addresses its jurisdiction over each defendant in turn.

 A. Necmettin Oztemir

 Plaintiff represents, and defendants do not dispute, that Oztemir was personally served with the complaint while in the District of Columbia. Physical service of process on Oztemir within the District is clearly sufficient to support the Court's exercise of personal jurisdiction over him. *fn4" See Begum v. Auvongazeb, 695 A.2d 112, 113-114 (D.C. 1997) (citing ...


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