Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

I Mark Marketing Services, LLC v. Geoplast

December 6, 2010

I MARK MARKETING SERVICES, LLC, PLAINTIFF,
v.
GEOPLAST, S.P.A., DEFENDANT.



The opinion of the court was delivered by: Colleen Kollar-kotelly United States District Judge

MEMORANDUM OPINION

Plaintiff I Mark Marketing Services, LLC ("IMARK") filed the above-captioned action against Defendant Geoplast S.p.A. ("Geoplast S.p.A.") pursuant to this Court's diversity jurisdiction under 28 U.S.C. § 1332. IMARK asserts claims against Geoplast S.p.A. for breach of contract, unjust enrichment, quantum meruit, and tortious interference with an economic relationship. Presently before the Court is Geoplast S.p.A.'s [10] Motion to Dismiss Pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6) ("Def.'s Mot."). For the reasons set forth below, the Court shall (1) DENY Geoplast S.p.A.'s motion to dismiss for lack of personal jurisdiction because IMARK has alleged sufficient facts to both confer jurisdiction under the District of Columbia's long-arm statute and comport with due process; and (2) GRANT Geoplast S.p.A.'s motion to dismiss IMARK's tortious interference claim because IMARK has failed to state a claim upon which relief can be granted.

I. BACKGROUND

Geoplast S.p.A., an Italian corporation headquartered in Padova, Italy, is a plastics manufacturer that specializes in construction-related products. Compl. ¶¶2, 6. IMARK is a marketing company organized as a Delaware limited liability company with its principal place of business in the District of Columbia ("District"). Id. ¶¶ 2, 5. In Italy, IMARK and Geoplast S.p.A. negotiated and, on February 5, 2009, entered into a two-year contract ("Contract"). Id. ¶¶ 7, 10; Def.'s Mot., Ex. B (Affidavit of Mirco Pegoraro (hereinafter, "Pegoraro Decl.")), ¶¶ 4-5.*fn1 Pursuant to the Contract, IMARK agreed to assist Geoplast S.p.A. in expanding into the U.S. market. See Compl. ¶ 7; id., Ex. A (Contract in the original Italian); id., Ex. B (Contract Translated into English).*fn2 To accomplish Geoplast S.p.A.'s expansion, the Contract enumerates several tasks IMARK would undertake, including developing a marketing plan, establishing business relationships with U.S. entities on Geoplast S.p.A.'s behalf, and "establishing [Geoplast U.S.], subsidiary of [Geoplast S.p.A.], in Washington [D.C.], with legal business addressed at IMARK headquarters." See id. ¶¶ 7, 16; id., Ex. B, at 2. Geoplast S.p.A., in turn, granted IMARK the exclusive right to market its goods in the United States and agreed to pay IMARK both a monthly fee of $10,000 and commissions, pursuant to a schedule set forth in the Contract, for any contracts IMARK secured on its behalf. See id. ¶¶ 8, 12-15; id., Ex. B.

As contemplated by the Contract, on February 20, 2009, Geoplast S.p.A.'s managing director, Mirco Pegoraro, directed Roberta Marcenaro, IMARK's vice president, to form a wholly-owned U.S. subsidiary of Geoplast S.p.A. (hereinafter, "Geoplast U.S.") with the necessary licenses to conduct business in the District. Pl.'s Opp'n to Def.'s Mot. to Dismiss ("Pl.'s Opp'n"), Ex. 1 (Decl. of Roberta Marcenaro (hereinafter, "Marcenaro Decl.")) ¶¶ 3, 5, 7. Geoplast U.S. was incorporated in Delaware on March 4, 2009, with Geoplast S.p.A.'s managing director, Mr. Pegoraro, as Geoplast U.S.'s president and sole director. Pl.'s Opp'n Ex. 2 (Decl. of Pietro Raugi (hereinafter, "Raugi Decl.")) ¶¶ 15-16; see also id., Ex. B (Statement of Geoplast U.S.'s Sole Incorporator). Mr. Raugi, IMARK's president, served as Geoplast U.S.'s vice president and Ms. Marcenaro, IMARK's vice-president, served as Geoplast U.S.'s secretary and treasurer. Raugi Decl. ¶ 2; id.,Ex. E (Geoplast U.S.'s Application with the D.C. Dep't of Consumer & Regulatory Affairs (hereinafter, "DCRA Application")); Marcenaro Decl. ¶ 3. Geoplast U.S. issued a total of one hundred shares of stock, all of which were issued to Geoplast S.p.A. Raugi Decl. ¶ 18; id. Ex. C (Geoplast U.S.'s Written Consent of the Sole Director in Lieu of the Org. Meeting), at 2. On March 11, 2009, Geoplast U.S. submitted its application to the D.C. Department of Consumer and Regulatory Affairs ("DCRA") in order to qualify to conduct business within the District. Id., Ex. E (DCRA Application). Although Geoplast U.S.'s license to do business in the District appears to have been revoked in September 2009, there is no indication that Geoplast U.S. has dissolved.*fn3 See Def.'s Reply to Pl.'s Opp'n to the Rule 12(b) Mot. to Dismiss ("Def.'s Reply") at 6 & 6 n.1.

Geoplast U.S.'s sole purpose, according to Mr. Raugi, is to function as a conduit for Geoplast S.p.A.'s products to enter the U.S. market. Raugi Decl. ¶ 11. Geoplast S.p.A. paid the legal costs associated with Geoplast U.S.'s incorporation. Id. ¶¶ 12-14. In addition, Geoplast U.S. does not maintain its own bank account, as Geoplast S.p.A. pays Geoplast U.S.'s expenses and provides all of Geoplast U.S.'s assets. Id. ¶¶ 19, 25.*fn4 Geoplast U.S.'s website, which is maintained by Geoplast S.p.A. and was once simply an English translation of Geoplast S.p.A.'s website, allows customers to download brochures and pamphlets regarding Geoplast S.p.A.'s products. Id. ¶¶ 28, 31. These promotional materials group Geoplast S.p.A. and Geoplast U.S. under the heading of "Geoplast International," with headquarters listed as Geoplast S.p.A.'s address in Italy and with a North American location listed as Geoplast U.S.'s address in the District.*fn5 See, e.g., Marcenaro Decl., Ex. C (Tank Elevator and Modulo System Brochures), at 8, 22. According to these materials, and the business cards Geoplast S.p.A. provided Mr. Raugi and Ms. Marcenaro as officers of Geoplast U.S., Geoplast U.S.'s principal place of business is the same as IMARK's office----1054 31st Street NW, Suite 200, in Washington, D.C. See Raugi Decl. ¶¶21-22; id. Ex. D (Ms. Marcenaro's Geoplast U.S. business card); id. Ex. G (Freezer Warehouse Brochure); Marcenaro Decl., Ex. C, at 8, 22.

For approximately a year, Geoplast S.p.A. and IMARK operated under the Contract without incident. Geoplast S.p.A. sent monthly payments to IMARK's bank account located at 1400 G Street, N.W. in Washington D.C. ¶ 8. In addition, between March 2009 and July 2009, IMARK received at its D.C. office 127 emails from Geoplast S.p.A. employees. Id. ¶ 34; see also id. ¶ 7 (alleging that IMARK also received "numerous phone calls" from Geoplast S.p.A.'s managing director and sales manager between 2009 and early 2010).

On February 4, 2010, for reasons unclear from the present record, Geoplast S.p.A. sent IMARK what IMARK characterizes as a "new" contract to govern the parties' relationship. Compl. ¶ 25. IMARK refused to enter into this "new" contract or otherwise modify the parties' existing Contract. Id. ¶ 26. Subsequently, Geoplast S.p.A. ceased making its monthly payments to IMARK and then, on March 2, 2010, informed IMARK that Geoplast S.p.A. had canceled the Contract. Id. ¶¶27-28.

IMARK avers that prior to receiving Geoplast S.p.A.'s cancellation notice, it had expended significant time and incurred substantial costs to meet its contractual obligations. Id. ¶ 18. Specifically, IMARK claims it expended resources in identifying potential buyers for Geoplast S.p.A., as well as hiring and training a representative to market Geoplast S.p.A.'s products in the United States. Id. ¶¶ 19-20. IMARK further alleges that after incurring these expenses, Geoplast S.p.A. then attempted to hire "key personnel" away from IMARK in order to circumvent Geoplast S.p.A.'s contractual obligations. Id. ¶¶ 21-22. IMARK also claims that Geoplast S.p.A. violated IMARK's right under the Contract to be Geoplast S.p.A.'s exclusive supplier in the United States by directly contacting those business "IMARK had cultivated business relationships with" in order to sell its products without IMARK as an intermediary. See id. ¶¶ 23-24.

On March 4, 2010, two days after Geoplast S.p.A. informed IMARK that it had canceled the Contract, IMARK filed the Complaint in this case. IMARK asserts four claims against Geoplast S.p.A.: (1) breach of contract (Count I); (2) unjust enrichment (Count II); (3) quantum meruit (Count III); and (4) tortious interference with an economic relationship (Count IV). Compl. ¶¶ 31-51. On May 4, 2010, Geoplast S.p.A. responded by filing its [10] Motion to Dismiss Pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6) ("Def.'s Mot."). In its motion, Geoplast S.p.A. argues that all of IMARK's claims should be dismissed because this Court lacks personal jurisdiction over Geoplast S.p.A. and, in the alternative, IMARK's tortious interference claim (Count IV) should be dismissed for failure to state a claim. In support of its motion, Geoplast S.p.A. attached a declaration from Mr. Pegoraro, Geoplast S.p.A.'s managing director. See Def.'s Mot., Ex. B. IMARK subsequently filed its [11] Opposition to Geoplast's Motion to Dismiss ("Pl.'s Opp'n"), which includes declarations from Mr. Raugi, IMARK's president, Pl.'s Opp'n, Ex. 2, and Ms. Marcenaro, IMARK's vice-president, id., Ex. 1, as well as numerous exhibits. Finally, Geoplast S.p.A. filed its [12] reply ("Def.'s Reply"). The parties' briefing on the pending motion is now complete, and the matter is therefore ripe for review and resolution by this Court.

II. LEGAL STANDARD

A. Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(2)

A plaintiff bears the burden of establishing a factual basis for asserting personal jurisdiction over a defendant. See Crane v. N.Y. Zoological Soc'y, 894 F.2d 454, 456 (D.C. Cir. 1990). "The plaintiff, however, cannot rest on bare allegations or conclusory statements and must allege specific facts connecting each defendant with the forum." GTE New Media Servs., Inc. v. Ameritech Corp., 21 F. Supp. 2d 27, 36 (D.D.C. 1998); see also Second Amendment Found. v. U.S. Conference of Mayors, 274 F.3d 521, 524 (D.C. Cir. 2001) (same). "To make such a showing, the plaintiff is not required to adduce evidence that meets the standards of admissibility reserved for summary judgment and trial; rather she may rest her arguments on the pleadings, 'bolstered by such affidavits and other written materials as [she] can otherwise obtain.' " Urban Inst. v. FINCON Servs., 681 F. Supp. 2d 41, 44 (D.D.C. 2010) (quoting Mwani v. bin Laden, 417 F.3d 1, 7 (D.C. Cir. 2005)) (alteration in original). When determining whether personal jurisdiction exists over a defendant, the Court need not treat all of a plaintiff's allegations as true. Instead, the Court "may receive and weigh affidavits and any other relevant matter to assist it in determining the jurisdictional facts." United States v. Philip Morris, Inc., 116 F. Supp. 2d 116, 120 n.4 (D.D.C. 2000) (internal quotation marks and citation omitted). Any factual discrepancies with regard to the existence of personal jurisdiction, however, must be resolved in favor of the plaintiff. See Crane, 894 F.2d at 456.

B. Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6)

Under the Federal Rules of Civil Procedure, a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. (8)(a), "in order to 'give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.' " Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Although "detailed factual allegations" are not necessary to withstand a Rule 12(b)(6) motion to dismiss, to provide the "grounds" of "entitle[ment] to relief," a plaintiff must furnish "more than labels and conclusions" or "a formulaic recitation of the elements of a cause of action." Id. "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.' " Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at 557). Rather, a complaint must contain sufficient factual allegations that if accepted as true, "state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949 (citing Twombly, 550 U.S. at 556).

When considering a motion to dismiss for failure to state a claim, the Court must construe the complaint in a light most favorable to the plaintiff and must accept as true all reasonable factual inferences drawn from well-pleaded factual allegations. In re United Mine Workers of Am. Empl. Benefit Plans Litig., 854 F. Supp. 914, 915 (D.D.C. 1994); see also Schuler v. United States, 617 F.2d 605, 608 (D.C. Cir. 1979) ("The complaint must be liberally construed in favor of the plaintiff, who must be granted the benefit of all inferences that can be derived from the facts alleged.") (internal quotation marks omitted). However, a plaintiff must provide more than just "a sheer possibility that a defendant has acted unlawfully." Iqbal, 129 S.Ct. at 1950. When a complaint's well-pleaded facts do not enable a court, "draw[ing] on its judicial experience and common sense," "to infer more than the mere possibility of misconduct," the complaint has not shown that the pleader is entitled to relief. Id. In evaluating a motion to dismiss under Rule 12(b)(6), the Court is limited to considering the facts alleged in the complaint, any documents attached to or incorporated in the complaint, matters of which the court may take judicial notice, and matters of public record. See EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1997); see also Vanover v. Hantman, 77 F. Supp. 2d 91, 98 (D.D.C. 1999) ("[W]here a document is referred to in the complaint and is central to plaintiff's claim, such a document attached to the motion papers may be considered without converting the motion to one for summary judgment."), aff'd, 38 F. App'x 4 (D.C. Cir. 2002).

III. DISCUSSION

Geoplast S.p.A. has filed motions to dismiss pursuant to both Rule 12(b)(2) for lack of personal jurisdiction and Rule 12(b)(6) for failure to state a claim. Generally, courts must evaluate a motion to dismiss for lack of personal jurisdiction prior to considering a motion to dismiss for failure to state a claim. See, e.g., Feinstein v. Resolution Trust Corp., 942 F.2d 34, 40 (1st Cir. 1991) ("[C]courts should ordinarily satisfy jurisdictional concerns before addressing the merits of a civil action."); Combs v. Bakker, 886 F.2d 673, 675 (4th Cir. 1989) (finding the district court's decision to first address defendants' Rule 12(b)(6) motion "awkward[]" and that the "proper course of review" required defendants' Rule 12(b)(2) motion to be considered first). This "rule is not mechanically to be applied." Feinstein, 942 F.2d at 40. However:

Not only does logic compel initial consideration of the issue of jurisdiction over the defendant -- a court without such jurisdiction lacks power to dismiss a complaint for failure to state a claim -- but the functional difference that flows from the ground selected for dismissal likewise compels considering jurisdictional and venue questions first. A dismissal for lack of jurisdiction or improper venue does not preclude a subsequent action in an appropriate forum, whereas a dismissal for failure to state a claim upon which relief can be granted can be granted with prejudice.

Arrowsmith v. United Press Int'l, 320 F.2d 219, 221 (2d Cir. 1963). Accordingly, the Court shall first address Geoplast S.p.A.'s motion to dismiss pursuant to Rule 12(b)(2) and then its motion to dismiss under Rule 12(b)(6). For the reasons set forth below, the Court shall deny Geoplast S.p.A.'s motion to dismiss for lack of personal jurisdiction and grant Geoplast S.p.A.'s motion to dismiss IMARK's tortious interference claim (Count IV) for failure to state a claim.

A. Personal Jurisdiction

IMARK has the burden of establishing personal jurisdiction over Geoplast S.p.A. Crane, 894 F.2d at 456. In attempting to meet this burden, IMARK first argues that both Geoplast S.p.A.'s and Geoplast U.S.'s contacts with the District should be considered, as Geoplast S.p.A. operated such control over Geoplast U.S. that the two entities actually operated as a single entity. See Pl.'s Opp'n at 6-9. IMARK then argues that Geoplast S.p.A.'s and Geoplast U.S.'s collective contacts with the District justify the exercise of personal jurisdiction over Geoplast S.p.A. See id. at 9-13. For the reasons set forth below, the Court concludes that Geoplast U.S. and Geoplast S.p.A. are alter egos and that their collective contacts warrant this Court exercising personal jurisdiction over Geoplast S.p.A.

1. Geoplast S.p.A. and Geoplast U.S. are Alter Egos

"Ordinarily, a defendant corporation's contacts with a forum may not be attributed to . . . affiliated corporations. An exception exists, however, where affiliated parties are 'alter egos' of a corporation over which the Court has personal jurisdiction; in that case the corporation's contacts may be attributed to the affiliated party for jurisdictional purposes." Diamond Chem. Co. v. Atofina Chems., Inc., 268 F. Supp. 2d 1, 7 (D.D.C. 2003) (quoting Shapiro, Lifschitz & Schram v. Hazard ("Hazard I"), 24 F. Supp. 2d 66, 70 (D.D.C. 1998)). To establish that Geoplast S.p.A. and Geoplast U.S. are alter egos, IMARK must satisfy a two-prong test:

(1) Is there a unity of interest and ownership between Geoplast S.p.A. and Geoplast U.S. such that their separate corporate personalities no longer exist?; and

(2) If the acts are treated as only Geoplast U.S.'s, will an inequitable result occur?

Labadie Coal Co. v. Black, 672 F.2d 92, 96 (D.C. Cir. 1982); see also Shapiro, Lifschitz & Schram v. Hazard ("Hazard II"), 90 F. Supp. 2d 15, 23 n.6 (D.D.C. 2000) ("Although this test generally is used to reach an individual behind a corporation, this same test has been applied to pierce the corporate veil between two corporations, such as between a parent-subsidiary corporations."). Whether IMARK satisfies this test is a question of law. See Johnson-Tanner v. First Cash Fin. Servs., Inc., 239 F. Supp. 2d 34, 38 (D.D.C. 2003). The Court shall address each prong in turn.

a. Unity of Interest and Ownership

To justify piercing the corporate veil between a parent and a subsidiary, the parent's control of the subsidiary must be "active and substantial, but it need not be exclusive in a hypertechnical or day-to-day sense." Material Supply Int'l, Inc. v. Sunmatch Indus. Co., 62 F. Supp. 2d 13, 20 (D.D.C. 1999) (quoting Valley Fin., Inc. v. United States, 629 F.2d 162, 172 (D.C. Cir. 1980)). The variety of factual circumstances in which piercing the corporate veil arises precludes a rigid standard of what constitutes "active and substantial" control. See id. (citing Valley Fin., 629 F.2d at 172). Nevertheless, the D.C. Circuit has instructed courts to consider the following factors: (1) the nature of the corporate ownership and control; (2) failure to maintain corporate minutes or adequate records; (3) failure to maintain the corporate formalities; (4) a commingling of funds and other assets; (5) diversion of corporate funds or assets to other uses; and (6) use of the same office or business location. Labadie Coal, 672 F.2d at 97-99; see also id. at 96 ("[F]ormalities are [] an excellent litmus of the extent to which the individuals involved actually view the corporation as a separate being.").*fn6 "It is clearly not necessary that all of these factors be present in a given case to justify piercing the veil." Labadie Coal Co., 672 F.2d at 97. Moreover, as "piercing the corporate veil is a doctrine of equity, 'the factor that predominates will vary in each case . . . .' " Camacho v. 1440 Rhode Island Ave. Corp., 620 A.2d242, 249 (D.C. 1993) (quoting Vuitch v. Furr, 482 A.2d 811, 815-16 (D.C. 1984)).

In this case, IMARK argues that Geoplast S.p.A. and Geoplast U.S. are alter egos because: (1) Geoplast U.S. is a wholly-owned subsidiary of Geoplast S.p.A.; (2) Geoplast S.p.A. represents to potential clients that Geoplast U.S. is its U.S. branch; (3) Geoplast S.p.A. and Geoplast U.S. use identical logos and trademarks; (4) for a time, Geoplast U.S. and Geoplast S.p.A. shared website content; (5) Geoplast S.p.A.'s managing director, Mr. Pegoraro, is Geoplast U.S.'s president and sole director; and (6) Geoplast U.S. does not maintain a separate bank account and Geoplast S.p.A. pays Geoplast U.S.'s expenses. Pl.'s Opp'n at 6-8. In its reply, Geoplast S.p.A. generally denies IMARK's aforementioned allegations, but does not respond to them individually or offer evidence to contradict them. See Def.'s Reply at 7. Moreover, Geoplast S.p.A. does not contest IMARK's argument that Geoplast S.p.A. and Geoplast U.S. are alter egos. See Def.'s Reply at 2-3.*fn7 For the reasons set forth below, the ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.