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Chin-Ten HSU v. New Mighty U.S. Trust

United States District Court, District of Columbia

February 12, 2018

CHIN-TEN HSU, et al., as Executors of the will of Yueh-Lan Wang, Plaintiffs,
NEW MIGHTY U.S. TRUST, et al., Defendants.


          JAMES E. BOASBERG United States District Judge

         Having watched this case wend its way through many twists and turns, the Court must now determine whether it in fact belongs across the Pacific. Bringing a Motion to Dismiss for forum non conveniens, Defendants contend that Taiwan, not the District of Columbia, is the appropriate jurisdiction in which to resolve this dispute over the estate of plastics magnate Yung-Ching (Y.C.) Wang. At the time of his death in 2008, Y.C. was worth an estimated $6.8 billion - making him, according to Forbes, the 178th wealthiest individual in the world. Although he amassed quite a fortune, he lacked one crucial asset: a last will and testament. In the years since his passing, the distribution of Y.C.'s estate has thus become a significant source of contention among his many putative heirs. These claimants, to further complicate matters, belong to three separate “families” derived from Y.C.'s relationships with different women.

         Nearly eight years ago, Winston Wen-Young Wong, Y.C.'s son from his Second Family, kicked off this modern-day Jarndyce v. Jarndyce when he filed suit on behalf of the First Family, which consists solely of Yueh-Lan Wang, the woman to whom Y.C. had been married since 1935. Winston, whom Yueh-Lan named as her lone heir, alleged that her marital share of Y.C.'s estate had been “shorted” by unlawful transfers of funds prior to Y.C.'s death. Asserting that Defendants - a D.C.-based trust and its affiliates - held a portion of these assets, Winston sought to reclaim Yueh-Lan's full disbursement from Y.C.'s estate. After a series of intervening events - including Yueh-Lan's death and the subsequent appointment of Executor-Plaintiffs in Taiwan - and procedural detours, the case returned to this Court's docket last year. This past August, the Court allowed Plaintiffs to file a Second Amended Complaint, and today it turns to Defendants' Motion to Dismiss that Complaint. Finding that Taiwan is an adequate alternative forum and that the relevant interests weigh strongly in favor of dismissal, the Court will grant their Motion under the doctrine of forum non conveniens. It will, however, condition that grant upon Defendants' waiver of statue-of-limitations defenses and potential additional constraints.

         I. Background

         A. Factual and Procedural History

         As the lengthy and colorful history of this case is set forth in full in the Court's prior Opinions, it need not repeat the complete narrative here. See Yueh-Lan Wang ex rel. Wong v. New Mighty U.S. Tr. (Wang I), 841 F.Supp.2d 198, 200 (D.D.C. 2012), rev'd sub nom. Wang by & through Wong v. New Mighty U.S. Tr. (Wang Appellate Decision), 843 F.3d 487 (D.C. Cir. 2016); Yueh-Lan Wang by & through Winston Wen-Young Wong v. New Mighty U.S. Tr. (Wang II), 322 F.R.D. 11, 15 (D.D.C. 2017). The Court also frequently refers to participants by their first name to avoid confusion and not out of any disrespect.

         To recap briefly: this dispute centers on the disbursement of the estate of Y.C. Wang. When Y.C. died in 2008, his plastics empire made him the second-wealthiest individual in Taiwan. See Second Am. Compl, ¶ 18. Yet he had no will - an unfortunate oversight given that he left behind nine children and three putative wives. This suit is brought on behalf of the estate of the first of those partners, Yueh-Lan. Married to Y.C. for 72 years, Yueh-Lan witnessed her husband's meteoric rise, including his founding of Formosa Plastic Group, which is “one of Taiwan's biggest and most profitable manufacturing conglomerates with annual sales of over $60 billion and operations in five countries.” Id., ¶ 17. She, as the “First Family, ” also witnessed his fathering children with two other women - Wang Yang Chiao and Pao Chu (P.C.) Lee. Id., ¶¶ 25-26. While Y.C. and Yueh-Lan had no offspring, his relationship with Wang Yang Chiao resulted in the birth of five children known as the “Second Family, ” and P.C. Lee produced another four known as the “Third Family.” Id., ¶ 26.

         As any reader of Bleak House could have been predicted, the matter of Y.C.'s estate and its disbursement has led to some discord among his three families and their various children. Related suits have been brought in Taiwan, Bermuda, New Jersey, Hong Kong, and, of course, before this Court. See ECF 38-4 (discussing Taiwan action); SAC, ¶ 64 (discussing Bermuda action); Shu v. Wang (DNJ Action), 2016 WL 6080199, at *1 (D.N.J. Oct. 17, 2016); ECF 49-21, ¶ 60 (discussing Hong Kong Action). This case was first filed on October 14, 2010, by Dr. Winston Wen-Young Wong (Winston), a member of the Second Family and Y.C.'s eldest son, who asserted that he was acting through a valid power-of-attorney in bringing the suit on Yueh-Lan's behalf. See ECF No. 1 (Complaint). Although Winston is a Second Family member, Yueh-Lan named him as her sole heir, and he thus has a significant interest in the restoration of any assets to her estate. See SAC, ¶ 14. Defendants are a trust formed under the laws of the District of Columbia - New Mighty U.S. Trust - as well as its trustee, Clearbridge, LLC, and a beneficiary of the trust, New Mighty Foundation. See SAC, ¶¶ 19-21. Both the Foundation and Clearbridge, it should be noted, are linked to children of the Third Family. See Wang II, 322 F.R.D. at 16.

         Yueh-Lan's claims sought the return of property transferred by Y.C. to Defendants during the five years prior to his death, on the ground that Taiwanese and D.C. law would allegedly entitle her to recover these assets as part of her 50% spousal share. Wang I, 841 F.Supp.2d at 200. Although Yueh-Lan received a portion of Y.C.'s $1.7 billion “Taiwan Assets” after his death, she asserted that this sum “represent[ed] only a fraction of Y.C.'s” holdings, and that the full Marital Assets were in fact “greater than double the value of [that] property.” SAC, ¶¶ 5, 34-36; see ECF No. 47-2 (Decl. of Andrew Muscato), ¶ 20 (asserting that Yueh-Lan received “hundreds of millions of dollars” from Y.C.'s Taiwan Assets).

         Defendants initially moved to dismiss these claims on a variety of grounds, and this Court granted that entreaty after finding a lack of diversity jurisdiction. Wang I, 841 F.Supp.2d at 208; see Wang Appellate Decision, 843 F.3d at 488. Plaintiff appealed this ruling, but Yueh-Lan died shortly thereafter. Although she had named Winston as her sole heir, she had failed to appoint an executor. See Wang Appellate Decision, 843 F.3d at 489; SAC, ¶ 14. The D.C. Circuit thus held the case in abeyance while the Taiwanese courts determined who should act in that role. Eventually, Chen-Teh Shu, Dong-Xung Dai, and Robert Shi were chosen by the courts, and the three men moved to substitute themselves as Yueh-Lan's personal representatives under the appropriate Federal Rule of Appellate Procedure while the case was still pending at the D.C. Circuit. Id. at 489. Before ruling on that motion, though, the D.C. Circuit again stayed the case after the Supreme Court granted certiorari in Americold Realty Trust v. ConAgra Foods, Inc., 136 S.Ct. 1012 (2016), which addressed the appropriate citizenship test for a real-estate trust - a question germane to the existence of diversity jurisdiction in this case. Wang Appellate Decision, 843 F.3d at 489 n.6.

         Based on the decision in Americold, the D.C. Circuit eventually reversed this Court's dismissal of Yueh-Lan's Complaint. The Circuit, at the same time, also granted the Executors' substitution motion “without prejudice to the defendants' ability to renew in district court those arguments they ha[d] pressed before.” Id. at 496. Returning to this Court, Plaintiff Executors filed a Motion for Leave to File a Second Amended Complaint and for Other Relief. See Wang II, 322 F.R.D. at 30; ECF No. 37. Finding that Defendants' various futility, joinder, and bad-faith arguments fell short, and that many should be reserved for later briefing, the Court concluded that “no barriers exist[ed] to the filing of Plaintiff Executors' Second Amended Complaint” and granted the motion in full. Wang II, 322 F.R.D. at 32.

         B. Second Amended Complaint

         The operative Second Amended Complaint alleges five counts under the Civil Code of Taiwan: (1) Yueh-Lan has not received the full value of the 50% share she is entitled to under Article 1030-1; (2) to the extent her claim cannot be satisfied from property held by Y.C. at his death, Plaintiffs are entitled to restitution from third parties pursuant to Article 1030-3; (3) Yueh-Lan is entitled to restitution from Defendants for infringing upon her right of inheritance pursuant to Article 1146; (4) Plaintiffs are entitled to the return of assets, monies, and property distributed or transferred to Defendants from the marital estate pursuant to Article 767; and (5) Defendants unjustly benefited from the improper acquisition of Y.C.'s assets and are bound to return them under Article 179. See SAC, ¶¶ 66-101. Plaintiffs also bring four counts under D.C. common law: (1) unlawful conversion of Yueh-Lan's rightful marital property; (2) unjust enrichment from the improper acquisition and use of such property; (3) an action for a constructive trust to be imposed to ensure that Plaintiffs receive Yueh-Lan's statutory share of Y.C.'s estate; and (4) an action for an accounting of all the assets, monies, and property owned by Y.C. prior to his death. See id., ¶¶ 102-120.

         Defendants have now filed a Motion to Dismiss the Second Amended Complaint, alleging both that it fails to state a claim under Fed. R. Civ. 12(b)(6) and that it should be discretionarily dismissed under the doctrine of forum non conveniens. See ECF 47 (Mot. to Dismiss SAC). Briefing on this Motion is now complete, and the Court must decide whether this suit will remain on its docket.

         II. Standard of Review

         Because the Court ultimately grants Defendants' Motion to Dismiss pursuant to forum non conveniens, it need not address their Motion under Rule 12(b)(6). It therefore presents the standard for only the former below.

         Whether to dismiss a case under forum non conveniens is a “discretionary decision that can be made at any time.” Stromberg v. Marriott Int'l, Inc., 474 F.Supp.2d 57, 60 (D.D.C. 2007), aff'd, 256 Fed.Appx. 359 (D.C. Cir. 2007). Dismissal under the doctrine is a “non-merits threshold inquiry, ” which “reflects a court's assessment of a range of considerations, most notably the ‘convenience to the parties and the practical difficulties that can attend the adjudication of a dispute in a certain locality.'” MBI Grp., Inc. v. Credit Foncier du Cameroun, 558 F.Supp.2d 21, 26-27 (D.D.C. 2008) (quoting Sinochem Int'l Co. Ltd. v. Malaysia Int'l Shipping Corp., 549 U.S. 422 (2007)).

         Applying forum non conveniens is a two-fold inquiry. First, the Court asks whether an adequate alternative forum exists. If so, it next looks to a set of public and private factors to determine if they favor dismissal. “If the balance favors the foreign forum, and if the Court is convinced that plaintiff effectively can bring its case in the alternative forum, the Court may dismiss the case on grounds of forum non conveniens.” KPMG Fin. Advisory Servs. Ltd. v. Diligence LLC, 2006 WL 335768, at *1 (D.D.C. Feb. 14, 2006) (citing Pain v. United Techs. Corp., 637 F.2d 775, 785-86 (D.C. Cir. 1980)). In asserting the doctrine, “the defendant has the burden on all aspects of a motion to dismiss on forum non conveniens grounds, including the obligation to establish as a prerequisite that an adequate alternative forum exists.” Id.

         III. Analysis

         Before turning to the two-step inquiry, the Court begins with a preliminary dispute over the application of forum non conveniens to this case - i.e., the timing of Defendants' Motion. Finding that this issue does not preempt a full analysis under FNC, the Court then proceeds to separately assess the adequacy of the alternative forum, and the private and public interests at stake.

         A. Timing

         As Plaintiffs acknowledge, motions to dismiss pursuant to forum non conveniens are not subject to any jurisdictional time bar or procedural waiver. See Opp. at 21. Yet they nonetheless assert that Defendants' Motion in this case should be rejected as untimely, citing to a series of cases holding that FNC motions must be brought within a “reasonable” time. Id. at 21-22. According to the Executors, this period has elapsed. Pointing out that this case has been pending since October 2010, Plaintiffs contend that Defendants had a number of opportunities to raise FNC earlier, but instead engaged in a “long-term, deliberate choice to not move for dismissal on FNC grounds.” Id. at 22. Plaintiffs assert that “no new facts have emerged” over the long life of this lawsuit that “might justify Defendants' recent shift” in asking for FNC dismissal. Id. at 25. Their “eleventh-hour decision to file an FNC motion, ” the Executors maintain, thus “has the appearance of improper forum shopping and gamesmanship.” Id. Finally, they state that “it would be highly inefficient for the parties and the courts, as well as prejudicial to Plaintiffs, to dismiss the case at this stage.” Id. at 26.

         The Court begins its analysis by noting that, although some courts have held that a defendant must bring an FNC motion within a “reasonable” period of time, the D.C. Circuit is not among them. See, e.g., Stromberg, 474 F.Supp.2d at 60 (decision “to dismiss a case under the forum non conveniens doctrine . . . can be made at any time”); L & L Const. Assocs., Inc. v. Slattery Skanska, Inc., 2006 WL 1102814, at *3 (D.D.C. Mar. 31, 2006) (court retains flexibility to make FNC dismissal decision “at any time”). In the absence of governing Circuit precedent, this Court declines to impose any such timeliness requirement. Yet, even if it were to consider the “reasonableness” of Defendants' timing, Plaintiffs would nonetheless not prevail. Although they are correct that this suit has been pending for eight years, this longevity is due not to any dilatory tactics or “gamesmanship” by Defendants, but instead is the result of the case's circuitous procedural history.

         As discussed above, the Court granted Defendants' first Motion to Dismiss for lack of subject-matter jurisdiction in 2012. After Plaintiffs appealed, the Court of Appeals suspended briefing and held the case in abeyance in order to resolve the executorship proceedings after Yueh-Lan's death, a process that took three years. See Wang II, 322 F.R.D. at 16-17. Restarting the appeal in the fall of 2015, Plaintiffs filed their motion for substitution, and Defendants requested dismissal on the ground that the suit was a “legal nullity.” Id. at 18. Yet the briefing on these claims was again suspended, pending the Supreme Court's decision in Americold, which finally issued in spring 2016. On December 9 of that year, the D.C. Circuit ruled in Plaintiffs' favor and remanded the case to this Court. Plaintiffs then moved to amend their Complaint in March 2017, and Defendants opposed on a number of grounds - including FNC. In August, the Court granted the Motion to Amend and denied FNC dismissal at that time, but permitted Defendants to reassert the defense in later briefing. The Executors filed their Amended Complaint in August 2017, and Defendants responded with the instant Motion to Dismiss, briefing on which was complete in late December. As this recounting demonstrates, the fact that 2018 has now arrived without even the filing of an Answer is hardly the result of Defendants' strategic choice.

         Defendants admittedly could have sought an FNC dismissal in their initial Motion to Dismiss, but they instead asserted a lack of diversity jurisdiction. This was certainly proper. While “forum non conveniens may justify dismissal of an action though jurisdictional issues remain unresolved, ” the doctrine may also be raised after such threshold questions have been addressed. Sinochem, 549 U.S. at 429, 424 (finding that FNC dismissal may precede jurisdictional inquiry, but noting contexts in which court might “first determine its own authority to adjudicate the case”). Although Plaintiffs suggest that Defendants were under some sort of obligation to raise FNC when Yueh-Lan appealed from this Court's ruling in Wang I, this position makes little sense in light of fundamental rules and practices of appellate procedure. This Court's first Opinion addressed a discrete issue of law - whether or not Yueh-Lan had established subject-matter jurisdiction in the District. Wang I, 841 F.Supp.2d at 200. Concluding that the citizenship of a trust required consideration of the citizenship of the trust's beneficiaries, this Court found that Plaintiff had not adequately demonstrated diversity and dismissed the First Amended Complaint on that ground. It was that decision that was appealed, and, given the intervening decision in Americold, overruled. See Wang Appellate Decision, 843 F.3d at 494-96. Plaintiffs' contention that Defendants should have tacked on a novel FNC submission during the course of this proceeding ignores the narrow scope of the issue on appeal and the fact that appellate courts generally do not “consider an issue not passed upon below, ” ...

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