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UNITED STATES DISTRICT COURT
`DISTRICT OF CONNECTICUT
`
`AWANO FOOD GROUP PTE LTD and
`BAALI INTERNATIONAL INC.,
`
`CIVIL ACTION NO.:
`
`Plaintiffs,
`
`3:20-cv-01383(KAD)
`
`V.
`
`FAIRTRADE INTERNATIONAL, INC. and
`RODRIGO ECHEVERRIGARAY,
`
`Defendants.
`
`NOVEMBER 17, 2020
`
`MEMORANDUM OF LAW IN SUPPORT OF MOTION BY
`FAIRTRADE INTERNATIONAL, INC. FOR JUDGMENT ON THE
`PLEADINGS PURSUANT TO FED. R. CIV. P. 12(c) AND 12(h)(3)
`
`Defendant FairTrade International Inc. ("FairTrade" or "Defendant"), by and through
`
`undersigned counsel, hereby moves for judgment on the pleadings as to the Complaint
`
`filed in this action by Plaintiffs Awano Food Group PTE Ltd. ("Awano") and Baali
`
`International Inc. ("Baali" and together with Awano, "Plaintiffs") (Dkt. 1). Defendant
`
`respectfully submits that diversity between the parties as required by 28 U.S.C. § 1332 is
`
`lacking. As this is the only basis for jurisdiction alleged in the Complaint, this Court does
`
`not have subject matter jurisdiction over the action. Accordingly, judgment should be
`
`entered dismissing the Complaint.
`
`I. This Action
`
`Plaintiffs commenced this action by filing their Complaint on September 15,2020.1
`
`FairTrade was served with process on October 6, 2020. Plaintiffs requested, and this Court
`
`1 Plaintiffs had commenced a similar action in the Superior Court of the State of Connecticut at
`Bridgeport (Case No. FBT-CV19-5042399 S), a year earlier. Plaintiffs voluntarily withdrew that
`proceeding by the filing of a Withdrawal of Action on September 29, 2020, three weeks after that
`court had, on September 8, 2020, scheduled argument for October 19, 2020 on a motion to dismiss
`for lack of personal jurisdiction.
`
`

`

`issued, a letter rogatory to assist in service of process on Defendant Rodrigo
`
`Echeverrigaray in Uruguay. (Dkt. 12, 14). Mr. Echeverrigaray has not yet been served.
`
`Plaintiffs' Complaint alleges three claims: Breach of contract, fraudulent
`
`conveyance, and breach of fiduciary duty, all arising under Connecticut State law. The
`
`Complaint alleges that this Court has subject matter jurisdiction over the three claims solely
`
`pursuant to 28 U.S.C. § 1332, diversity jurisdiction. The Complaint identifies each party to
`
`the action as follows: (1) Plaintiff "Awano is a Singapore Private Limited Company with a
`
`principal place of business in Singapore;" (2) Plaintiff "Baali is a Taiwan corporation with a
`
`principal place of business in Taiwan;" (3) Defendant "FairTrade is a Delaware corporation
`
`with a principal place of business in Connecticut;" and (4) Defendant "Rodrigo
`
`Echeverrigaray ("Rodrigo"), upon information and belief, is a citizen of Uruguay." (Dkt. 1,
`
`p.3). In the corporate disclosure statements submitted to this Court pursuant to Fed. R. Civ
`
`P. 7.1, Plaintiff Awano represents that it "is a Singapore private limited company with its
`
`principal place of business in Singapore," (Dkt. 10), and Plaintiff Baali represents that it "is
`
`a Taiwan corporation with its principal place of business in Taiwan." (Dkt. 11).
`
`FairTrade answered the Complaint, admitting the allegations concerning citizenship
`
`and principal place of business, and asserting the affirmative defense that subject matter
`
`jurisdiction over this action is lacking. (Dkt. 17, p. 13).
`
`On November 10, 2020, Plaintiffs moved to strike two of Defendant's affirmative
`
`defenses, which are based in Delaware corporate law. (Dkt. 18). FairTrade will respond to
`
`that motion in a separate brief.
`
`

`

`II. Standard
`
`Pursuant to Federal Rule 12(h)(3), "[i]fthe court determines at any time that it lacks
`
`subject-matter jurisdiction, the court must dismiss the action." Fed. R. Civ. P. 12(h)(3); See
`
`a/so Windward Dev., Inc. v. Thomas, 2018 WL 2272771, at *2 (D. Conn. May 17, 2018) ("It
`
`is common ground that in our federal system of limited jurisdiction any party or the court
`
`sua sponte, at any stage of the proceedings, may raise the question of whether the court
`
`has subject matter jurisdiction; and, if it does not, dismissal is mandatory.") (quoting
`
`Manway Constr. Co. v. Housing Auth. of Hartford, 711 F.2d 501, 503 (2d Cir. 1983)).
`
`A federal court may not determine the merits of a case over which it does not have
`
`jurisdiction: subject matter jurisdiction is "an unwaivable sine qua non for the exercise of
`
`federal judicial power." Herrick Co., Inc. v. SCS Communications, Inc., 251 F.3d 315, 321
`
`(2d Cir. 2001); See a/so Cortlandt St. Recovery Corp. v. Hellas Telecomms., S.A.R.L, 790
`
`F.3d 411, 416-17 (2d Cir. 2015) ("A district court properly dismisses an action ... for lack of
`
`subject matter jurisdiction if the court lacks the statutory or constitutional power to
`
`adjudicate it....") (quoting Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000)).
`
`A motion for judgment on the pleadings pursuant to Fed. R. Civ, P. 12(c) is analyzed
`
`under the same standard as that applied to a motion to dismiss pursuant to FRCP 12(b).
`
`Patel v. Contemporary Classics of Beverly Hills, 259 F.3d 123, 126 (2d Cir. 2001); see a/so,
`
`Komondy v. Gioco, 59 F. Supp. 3d 469, 473 (D. Conn.2014).
`
`Plaintiffs' claims for breach of contract, violation of fraudulent conveyance, and
`
`breach of fiduciary duty arise solely under Connecticut state law. Because Plaintiffs have
`
`not pleaded federal-question jurisdiction and the Complaint asserts no allegations to
`
`

`

`support any federal cause of action, the Court would have jurisdiction over this case only if
`
`there is diversity jurisdiction pursuant to 28 U.S.C. § 1332. There is not.
`
`III. The Court Lacks Subject-Matter Jurisdiction
`
`Diversity jurisdiction exists in civil actions where the amount in controversy exceeds
`
`$75,000.00, exclusive of interests and costs, and there is diversity of citizenship between
`
`the parties. 28 U.S.C. § 1332(a). "A corporation shall be deemed to be a citizen of every
`
`State and foreign state by which it has been incorporated and of the State or foreign state
`
`where it has its principal place of business [...]." 28 U.S.C. § 1332(c)(1). A corporation can
`
`only have one principal place of business. Hertz Corp. v. Friend, 559 U.S. 77, 93-94
`
`(2010). The determination of a corporation's principal place of business as outlined in
`
`Hertz, also applies to foreign corporations. JS Barkats PLLC v. Blue Sphere Corp., 2017
`
`WL 2930935, at *4 (S.D.N.Y. July 10, 2017) (applying the test dictated by Hertz to an Israeli
`
`corporation and noting that "an alien corporation's worldwide principal place of business,
`
`and not its principal place of business within the United States, is controlling.")
`
`As the party asserting federal jurisdiction, Plaintiffs bear the burden to show that
`
`diversity jurisdiction exists. Hertz Corp. v. Friend, 559 U.S. 77, 96 (2010); see a/so Herrick
`
`Co. v. SCS Commc'ns, Inc., 251 F.3d 315, 322 (2d Cir. 2001) and Borderud v. Riverside
`
`Motorcars, LLC, 2020 WL 2494760, at *2 (D. Conn. May 13, 2020).
`
`Alien citizenship "destroys diversity if there is an alien on the other side of the case
`
`and there are not citizens of states on both sides." 15 Moore's Federal Practice § 102.55
`
`(3d ed. 2003) (citing 28 U.S.C. § 1332(a)(2)-(4)). As is the case here, "diversity is lacking
`
`... where the only parties are foreign entities, or where on one side there are citizens and
`
`aliens and on the opposite side there are only aliens." Bayerische Landesbank, New York
`
`

`

`Branch v. Aladdin Capital Mgmt. LLC, 692 F.3d 42, 49 (2d Cir. 2012) (quoting Universal
`
`Licensing Corp. v. Paola del Lungo S.p.A., 293 F.3d 579, 581 (2d Cir. 2002)).
`
`Here, Plaintiffs are both foreign entities: Awano is a Singapore Private Limited
`
`Company with its principal place of business in Singapore and Baali is a Taiwan
`
`corporation with its principal place of business in Taiwan. As Plaintiffs allege, Defendant
`
`Rodrigo Echeverrigaray is a citizen of Uruguay and FairTrade is a Delaware corporation
`
`with its principal place of business in Connecticut. There are not citizens of states on both
`
`sides, therefore diversity is lacking. Accordingly, Plaintiffs' claims must be dismissed.
`
`IV. Conclusion
`
`On the basis of the foregoing, Defendant respectfully requests that the Court enter
`
`judgment dismissing Plaintiffs' Complaint for lack of subject matter jurisdiction
`
`Date: November 17, 2020
`
`THE DEFENDANT,
`FAIRTRADE INTERNATIONAL, INC.
`
`By: -•6 c / /
`Edward R. Scofield (ct 00455)
`
`Zeldes, Needle & Cooper, P.C.
`1000 Lafayette Boulevard
`Bridgeport, CT 06604
`Tel: (203)333-9441
`Fax: (203)333-1489
`Email: escofield@znclaw.com
`
`Attorney for Defendant
`
`Of counsel:
`
`Kathleen M. Kundar
`Fox Horan & Camerini LLP
`885 Third Avenue
`New York, New York 10022
`Tel.: (212) 480-4800
`Fax:(212)269-2383
`Email: kmkundar@foxlex.com
`
`

`

`CERTIFICATE OF SERVICE
`
`I hereby certify that on November 17, 2020, a copy of the foregoing was filed
`
`electronically and served by mail on anyone unable to accept electronic filing. Notice of
`
`this filing will be sent by e-mail to all parties by operation of the Court's electronic filing
`
`system or by mail to anyone unable to accept electronic filing as indicated on the Notice of
`
`Electronic Filing. Parties may access this filing through the Court's CM/ECF System.
`
`^-'- U. ^L-—
`Edward R. Scofield
`
`

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