STM Group Inc et al v. Gilat Satellite Networks LTD et al

Filing 40

MINUTES (IN CHAMBERS): ORDER by Judge David O. Carter: granting 12 Motion to Dismiss for Forum Non Conveniens. ( MD JS-6. Case Terminated ) (twdb)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No. SACV 11-0093 DOC (RZx)

Date: July 18, 2011

Title: STM GROUP, INC., ET AL. v. GILAT SATELLITE NETWORKS LTD
PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
Julie Barrera
Courtroom Clerk

Not Present
Court Reporter

ATTORNEYS PRESENT FOR PLAINTIFFS: ATTORNEYS PRESENT FOR DEFENDANTS:
NONE PRESENT

NONE PRESENT

PROCEEDING (IN CHAMBERS): GRANTING DEFENDANT’S MOTION TO DISMISS FOR
FORUM NON CONVENIENS
Before the Court is defendant Gilat Satellite Networks Ltd. (“Defendant” or “Gilat”)’s
Motion to Dismiss for forum non conveniens (Docket 12). The Court has considered the moving,
opposing, replying, and supplemental papers, and GRANTS Defendant’s Motion.
I.

Background

In analyzing this Motion to Dismiss for forum non conveniens (“Mot.”), the Court accepts
as true the facts alleged in Emil Youssefzadeh (“Mr. Youssefzadeh”) and STM Group, Inc. (“STM”)
(collectively “Plaintiffs”)’s Complaint (“Compl.”). See Carijano v. Occidental Petroleum Corp., 2011
WL 2138209, *1 (9th Cir. June 1, 2011) (citing Vivendi SA v. T–Mobile USA, Inc., 586 F.3d 689, 691
n.3 (9th Cir. 2009)) (accepting the facts alleged in plaintiff’s complaint when reviewing defendant’s
motion to dismiss for forum non conveniens).
Mr. Youssefzadeh is the president of STM, a corporation with its principal place of
business in Orange County, California. Compl. ¶¶ 1, 21. Gilat is an Israeli corporation with its
principal place of business in Petah Tikva, Israel. Id. at ¶ 3. STM and Gilat both deliver and install

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satellite communication products in Peru.1
In 2009, the Peruvian government department known as EL MINISTERIO DE
DEFENSA - Servicio de Comunicaciones del Ejército (the “Peruvian Army”) sought to purchase a
satellite communications system through a public tender. Compl. ¶ 8. A public tender is a bidding
process in which companies submit competing bids in an attempt to obtain business activity; whichever
company submits the lowest bid receives the job. In this case, STM and Gilat submitted bids to the
Peruvian Army. Id. at ¶ 11. On August 3, 2009, STM won the public tender and entered into a contract
with the Peruvian Army. Id. at ¶¶ 7-8. Pursuant to the contract, STM was to deliver and install satellite
communications products in exchange for $5,572,000. Id. at ¶¶ 8-9. STM allegedly completed the
delivery and installation on October 22, 2010, and final payment was due on or before November 21,
2010. Id. at ¶ 10.
Plaintiffs claim that Gilat was “extraordinarily angry” about losing the tender and
“maliciously took steps with friends and officials inside the Peruvian Government to make sure STM
[would] not be paid under the contract.” Id. at ¶¶ 11-12. Plaintiffs claim that Gilat “engaged in a
campaign of vicious rumors,” including telling members of the Peruvian Government that STM
illegally sold of MIG-29 fighter jets to Peru ten years earlier; that Gilat’s bid was one million dollars
less than STM’s bid; and that Mr. Youssefzadeh was part of a mafia. Id. at ¶¶ 14-15. Consequently,
Plaintiffs allege that Defendant intended and caused the Peruvian Army to breach their contractual duty
and not pay Plaintiffs. Id. at ¶¶ 15-17. As of March 30, 2011, Plaintiffs have collected $3,280,000
from the Peruvian Army, leaving $2,290,000 of the contract price unpaid. Declaration of Emil
Youssefzadeh in Support of Plaintiffs’ Opp’n, ¶ 34.
Plaintiffs filed their Complaint in Superior Court on December 17, 2010, bringing two
causes of action: Intentional Interference with Contract and Defamation (Docket 1). Defendant
removed the action to this Court on January 19, 2011 and filed the present Motion to Dismiss for forum
non conveniens on March 17, 2011 (Docket 12).
II.

Legal Standard

The doctrine of forum non conveniens “is based on the inherent power of the courts to
decline jurisdiction in exceptional circumstances.” Paper Operations Consultants Int’l, Ltd. v. S.S.
Hong Kong Amber, 513 F.2d 667, 670 (9th Cir. 1975). Such circumstances only exist when a
defendant makes “a clear showing of facts which . . . establish such oppression and vexation of a
1

Gilat owns a subsidiary, “Gilat to Home Peru S.A.,” existing under the laws of
Peru with its principal place of business in Lima, Peru. Declaration of Yair Shaharbany
RJN in Support of Defendant’s Mot., 4. Gilat owns another subsidiary called
“Wavestream Corp.” located in California. Compl. ¶ 3. Gilat is the only named
defendant in this action.
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defendant as to be out of proportion to plaintiff’s convenience . . . .” Cheng v. Boeing Co., 708 F.2d
1406, 1410 (9th Cir. 1983). Applying this standard, courts treat “forum non conveniens as an
exceptional tool to be employed sparingly.” Ravelo Monegro v. Rosa, 211 F.3d 509, 514 (9th Cir.
2000). Indeed, “[t]he doctrine of forum non conveniens is a drastic exercise of the court’s “inherent
power” because, unlike a mere transfer of venue, it results in the dismissal of a plaintiff’s case.”
Carijano v. Occidental Petroleum Corp., 2011 WL 2138209, *4 (9th Cir. June 1, 2011).
Nevertheless, the District Court has wide discretion to apply the forum non conveniens
doctrine where it sees fit. Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947). See also Am. Dredging Co.
v. Miller, 510 U.S. 443, 453 (1994) (“[W]here the [district] court has considered all relevant public and
private interest factors, and where its balancing of these factors is reasonable, its decision deserves
substantial deference.” (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 257 (1981))). “A citizen’s
forum choice should not be given dispositive weight. . . . [I]f the balance of conveniences suggests that
trial in the chosen forum would be unnecessarily burdensome for the defendant or the court, dismissal is
proper.” Piper Aircraft, 454 U.S. at 256 n.23; Contact Lumber Co. v. P.T. Moges Shipping Co. Ltd.,
918 F.2d 1446, 1449 (9th Cir. 1990).
“To prevail on a motion to dismiss based upon forum non conveniens, a defendant bears
the burden of demonstrating an adequate alternative forum, and that the balance of private and public
interest factors favors dismissal.” Carijano, 2011 WL 2138209 at *4 (citing Dole Food Co., Inc. v.
Watts, 303 F.3d 1104, 1117 (9th Cir. 2002)).
III.

Discussion
A.

Adequacy of the Forum

“An alternative forum is deemed adequate if: (1) the defendant is amenable to process
there; and (2) the other jurisdiction offers a satisfactory remedy.” Carijano v. Occidental Petroleum
Corp., 2011 WL 2138209, *4 (9th Cir. June 1, 2011) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235,
254 n.22 (1981)). These requirements are assessed in turn.
1.

Service

Defendant asserts that it is amenable to process in Peru because it would consent to
accept service in Peru. Mot. 9. Plaintiffs contend that this element is not satisfied because Defendant
“provided no authority showing it is subject to Peruvian jurisdiction under the laws of Peru.” Plaintiffs’
Opposition (“Opp’n”) 9.
A “voluntary submission to service of process” typically suffices to meet the first
requirement for establishing an adequate alternative forum. Tuazon v. R.J. Reynolds Tobacco Co., 433
F.3d 1163, 1178 (9th Cir. 2006). See also Carijano, 2011 WL 2138209 at *4; Gschwind v. Cessna
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Aircraft Co., 161 F.3d 602, 606 (10th Cir. 1998) (citing Piper Aircraft, 454 U.S. at 254 n.22) (noting
that submitting to service of process is “generally enough to make the alternative forum available”).
Thus, Defendant satisfies the first requirement for establishing an adequate alternative forum.
2.

Satisfactory Remedy

Dismissal for forum non conveniens is not appropriate “where the alternative forum does
not permit litigation of the subject matter of the dispute,” such that “the remedy provided by the
alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all.” Piper Aircraft,
454 U.S. at 254 n.22. However, dismissal may occur “even though the law applicable in the alternative
forum is less favorable to the plaintiff’s chance of recovery . . . .” Id. See also Carijano, 2011 WL
2138209 at *4 (noting that the requirement for an alternative forum to provide “some remedy” is easily
satisfied); Lueck v. Sundstrand Corp., 236 F.3d 1137, 1144 (9th Cir. 2001) (“[A] foreign forum will be
deemed adequate unless it offers no practical remedy for the plaintiff’s complained of wrong.”).
Defendant analogizes Plaintiffs’ two causes of action—Intentional Interference with
Contract and Defamation—with two Peruvian causes of action: Corporate Sabotage and Denigration.2
Mot. 10. Plaintiffs do not contest the idea that Peru’s Denigration cause of action provides an adequate
remedy for their defamation claim. Plaintiffs do argue, however, that Peru’s Corporate Sabotage claim
is “different” than a California Intentional Interference with Contract claim. Opp’n 10. Specifically,
Plaintiffs claim that “if STM prevailed [on its Corporate Sabotage claim], a fine would be paid to the
Peruvian government, not STM.” Id.
It is not necessary for an alternative forum to afford Plaintiffs the same causes of action
or remedies as Plaintiffs’ choice of forum. See Lueck, 236 F.3d at 1143 (“The foreign forum must
provide the plaintiff with some remedy for his wrong in order for the alternative forum to be adequate.”
(emphasis added)); Lockman Found. v. Evangelical Alliance Mission, 930 F.2d 764, 769 (9th Cir. 1991)
(holding that Japan was an adequate forum when plaintiff could bring tort and contract claims even
though RICO and Lanham Act claims were unavailable). Peru’s law, like California’s, allows a
plaintiff to pursue a claim against one who intentionally interferes with contractual relationships.
Corporate Sabotage is defined in Peru as “acts, the real or potential effect of which is . . . interference in
[a] contractual relationship . . . .” Nunez Decl., Ex. 6. The initial remedy for a Corporate Sabotage
claim does appear to be a fine paid to the Peruvian government. Opp’n 10. However, Defendants
emphasize that plaintiffs who succeed in Corporate Sabotage claims may obtain indemnification to
receive compensatory, injunctive, and declaratory relief. Defendant’s Reply to Plaintiffs’ Opp’n
(“Reply”) 9; Mot. 7. It would therefore be possible—albeit a longer process—for Plaintiffs to recover
2

Peruvian law defines denigration as “acts, the real or potential effect of which,
either directly or by implication, is to damage the image, credit, fame, prestige, or
entrepreneurial or professional reputation of another or other economic agent(s).”
Declaration of Diez-Canesco Nunez (“Nunez Decl.”), Ex. 6 (Docket 16).
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several types of relief. Thus, Peruvian law provides Plaintiffs with “some remedy” that is not “so
clearly inadequate or unsatisfactory that it is no remedy at all.” Piper Aircraft, 454 U.S. at 254.
Plaintiffs also argue that Peru is an inadequate forum because it “does not provide parties
with the right to propound interrogatories, requests for admission or document requests, or to take pretrial depositions directly,” so that Plaintiffs could not “possibly prove their claims.” Opp’n 10. As
Defendant points out, however, Peruvian courts do provide opportunities to conduct discovery. Courts
have the ability to subpoena and compel witness testimony and document production, and parties are
able to appeal a court’s discovery decisions. Mot. 10. Notably, this District has previously held that a
forum which denies plaintiffs the right to propound interrogatories, requests for admission, or document
requests, or to take pretrial depositions can still be adequate when the alternative forum retains power to
subpoena witnesses and compel limited discovery. See In re Air Crash Over Taiwan Straits on May 25,
2002, 331 F. Supp. 2d 1176, 1187 (C.D. Cal. 2004) (holding that Taiwan was an adequate forum where
Taiwan courts had the power to subpoena witnesses and compel limited discovery during trial, even
though parties could not propound interrogatories, requests for admission, or document requests, nor
take pretrial depositions). Although Peru does not offer Plaintiffs an identical version of discovery to
the United States federal system, it does provide Plaintiffs with adequate opportunity to litigate.
As Plaintiffs’ final adequacy challenge, Plaintiffs contend that Peru is an inadequate
forum because of government corruption in Peru. Opp’n 10. A recent Ninth Circuit decision examined
similar corruption allegations about Peru. See Carijano, 2011 WL 2138209. In Carijano, several
Peruvian plaintiffs and one California plaintiff sued a California-based oil company in California
federal court. Id. at *9. The plaintiffs opposed the defendant’s motion to dismiss for forum non
conveniens by arguing that the “Peruvian judiciary suffers from ‘institutionalized’ corruption, including
widespread lobbying of justices . . . .” Id. at *6. In response, the defendant described “efforts by the
Peruvian government to fight corruption that have included the removal and sanctioning of numerous
judges . . . .” Id. Although the defendant’s motion was eventually denied for other reasons, the Ninth
Circuit concluded that Peru was an adequate forum because plaintiffs’ evidence was “too generalized
and anecdotal” to demonstrate a “powerful showing” of corruption. Id. Although not dispositive, other
courts have similarly held that Peru is an adequate forum. See Flores v. S. Peru Copper Corp., 253 F.
Supp. 2d 510 (S.D.N.Y. 2002), aff’d, 414 F.3d 233 (2d Cir. 2003); Torres v. S. Peru Copper Corp., 965
F. Supp. 899 (S.D. Tex. 1996), aff’d, 113 F.3d 540 (5th Cir. 1997).
In contrast to the “generalized and anecdotal” allegations of corruption put forth in
Carijano, Plaintiffs claim to offer “concrete evidence” that Gilat has “tremendous influence with the
Peruvian government . . . .” Opp’n 2. Specifically, Plaintiffs point to a 2001 incident in which Gilat
allegedly bribed Peruvian public officials to deprive Plaintiff’s predecessor of a similar satellite
communications contract awarded through public tender as purported evidence of corruption. Id.
Plaintiffs support this allegation with an email discussing a $120,000 dollar payment “supposedly
oriented to Government Officials as part of an ‘under the table payment’ for help in getting the
Project.” Opp’n RJN Ex. A, 27. Plaintiffs rely on this email to suggest that “Gilat will not hesitate to
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bribe Peruvian government officials” and “will use its political influence to bury this case without a fair
hearing.” Opp’n 1, 10-11. Plaintiffs argue that “there is nothing to suggest Gilat does business
differently today.” Opp’n 11. Plaintiffs sued Gilat over the 2001 incident, and the parties settled the
case in 2003. Opp’n RJN Ex. A, ¶ 61.
To demonstrate that a foreign forum is inadequate due to corruption, Plaintiffs must make
a “powerful showing,” including specific evidence. Carijano, 2011 WL 2138209 at *5 (citing Tuazon,
433 F.3d at 1179) (emphasizing that very few courts hold that alternative forums are inadequate
because of corruption). Plaintiffs’ argument challenging a forum on the basis of corruption “does not
enjoy a particularly impressive track record.” Eastman Kodak Co. v. Kavlin, 978 F. Supp. 1078, 1084
(S.D. Fla. 1997). To be sure, Plaintiffs’ proffered email is more concrete evidence than a broad
assertion that the “Peruvian judiciary suffers from ‘institutionalized’ corruption.” Carijano, 2011 WL
2138209 at *5.
Nonetheless, Plaintiffs’ ten-year-old email fails to demonstrate that the Peruvian “legal
system is so fraught with corruption, delay and bias as to provide ‘no remedy at all.’” Tuazon, 433 F.3d
at 1179 (quoting Piper Aircraft, 454 U.S. at 254). Plaintiffs have only offered evidence of one alleged
bribery that occurred ten years ago. More importantly, Plaintiffs fail to offer any evidence suggesting
corruption within the Peruvian judiciary. Though evidence of an alleged bribery may shed doubt on
Gilat’s business practices, there is nothing in the record to suggest that Gilat’s alleged willingness to
bribe Peruvian officials, whether ten years ago or today, would have any effect on Plaintiffs’ ability to
receive a remedy in Peruvian courts at the present time. Thus, Plaintiffs’ evidence does not amount to a
“powerful showing” of Peruvian corruption. See Carijano, 2011 WL 2138209 at *5.
The Court further recognizes that when scrutinizing a foreign forum’s adequacy, it is
important to avoid “unnecessary indictments by our judges condemning the sufficiency of the courts
and legal methods of other nations.” Monegasque de Reassurances S.A.M. (Monde Re) v. Nak Naftogaz
of Ukraine, 158 F. Supp. 2d 377, 385 (S.D.N.Y. 2001); see also Carijano, 2011 WL 2138209 at *5.
For all these reasons, the Court finds that Peru is an adequate alternative forum.
B.

Balance of Private and Public Interest Factors

When a plaintiff chooses to litigate in its home forum, there is a “strong presumption in
favor of the plaintiff’s choice of forum, which may be overcome only when the private and public
interest factors clearly point towards trial in the alternative forum.” Piper Aircraft, 454 U.S. at 255.
“Greater deference is due because ‘a real showing of convenience by a plaintiff who has sued in his
home forum will normally outweigh the inconvenience the defendant may have shown.’” Gates Learjet
Corp. v. Jensen, 743 F.2d 1325, 1335 (9th Cir. 1984) (citing Piper Aircraft, 454 U.S. at 255 n.23).
However, “a United States citizen has no absolute right to sue in a United States court.” Mizokami
Bros. of Arizona, Inc. v. Baychem Corp., 556 F.2d 975, 977 (9th Cir. 1977) (holding that the District
Court properly dismissed a case for forum non conveniens despite the fact that plaintiff filed suit in its
home forum of Arizona).
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Plaintiffs’ choice of forum in this case is afforded substantial deference because Plaintiffs
filed this action in California. In order to overcome this deference, Gilat must establish that hearing
this action in a California forum “results in ‘oppressiveness and vexation . . . out of proportion’ to the
plaintiff’s convenience.” Carijano, 2011 WL 2138209 at *6 (citing Piper Aircraft, 454 U.S. at 241).
The Court finds that it has done so.
1.

Private Interest Factors

The factors relating to the private interests of the litigants include: “(1) the residence of
the parties and the witnesses; (2) the forum’s convenience to the litigants; (3) access to physical
evidence and other sources of proof; (4) whether unwilling witnesses can be compelled to testify; (5)
the cost of bringing witnesses to trial; (6) the enforceability of the judgment; and (7) all other practical
problems that make trial of a case easy, expeditious and inexpensive.” Boston Telecomms. Grp. v.
Wood, 588 F.3d 1201, 1206-07 (9th Cir. 2009) (quoting Lueck, 236 F.3d at 1145). “In applying these
factors, ‘the district court should look to any or all of the above factors which are relevant to the case
before it, giving appropriate weight to each.’” Tuazon, 433 F.3d at 1180 (quoting Lueck, 236 F.3d at
1145).
a.

Residence of Parties

When evaluating the private interest factors, the Ninth Circuit Court of Appeals recently
highlighted the importance of considering “the residence of all of the parties and the true nature of
Plaintiffs’ claims.” Carijano, 2011 WL 2138209 at *9. In Carijano, one Plaintiff resided in the forum
state of California. Id. The Court noted that the plaintiffs’ choice of forum was presumptively
convenient because plaintiffs filed the action in their home forum. Id. The Court also considered the
fact that the defendant, moving to dismiss the case from California, was itself a California corporation.
Id. As a result, the Court found that the “residence of the parties” factor weighed against dismissal. Id.
Regarding the true nature of the plaintiffs’ claims, the Court in Carijano also found that
“[m]ost of Plaintiffs’ claims turned not on the physical location of the injury but on the mental state of
the [defendant’s] managers who actually made the business decisions that allegedly resulted in the
injury.” Id. In other words, the claims in Carijano involved conduct “based on decisions made in and
policies emerging from [defendant’s] headquarters” in California. Id. Because the “decisionmakers”
and “witnesses with knowledge of [the defendant’s Peruvian subsidiary’s] operations” were based in
California, evidentiary and convenience factors weighed against dismissal. Id.
In this case, Plaintiffs argue that “it is hard to suggest that Peru would be a more
convenient forum than California” because “all parties are prominently based in California.” Opp’n 13.
Plaintiffs emphasize that both STM and Mr. Youssefzadeh are residents of California, and Gilat has
“substantial operations” in California. Id. Unlike the defendant in Carijano, however, Gilat does not
have its headquarters in California; Gilat is a resident of Israel and merely owns a subsidiary in
California that is unrelated to this case. See Meridian Seafood Products, Inc. v. Fianzas Monterrey,
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S.A., 149 F. Supp. 2d 1234, 1238 (S.D. Cal. 2001) (finding that ownership of an American subsidiary
corporation “has little bearing on the forum non conveniens analysis”). Nevertheless, the fact that
neither party is based in Peru causes the“residence of parties” factor to weigh against dismissal.
b.

Evidentiary and Convenience Considerations

Courts must also “evaluate the materiality and importance of the anticipated . . .
witnesses’ testimony and then determine their accessibility and convenience to the forum.” Boston
Telecomms., 588 F.3d at 1209 (quoting Lueck, 236 F.3d at 1146).
Plaintiffs contend that “primary . . . witnesses will be in the possession of Gilat and
STM,” and, therefore, this action should remain in California. Opp’n 13. Plaintiffs suggest that Gilat’s
“substantial operations in California” allow it to designate employees to “sit for a deposition in
California.” Id. Notably absent from Plaintiffs’ Opposition is any reference to specific witnesses, other
than Mr. Youssefzadeh, who reside in California. Plaintiffs’ Complaint does, however, reference
several people who would likely be primary witnesses in this suit, including Gilat’s “friends and
officials within the Peruvian government;” “members of the Peruvian Government, military and
congress and the press” to whom Gilat allegedly told false statements; and “powerful and influential
members of the Peruvian military, government and other public officials” whom Gilat allegedly
convinced not to pay Plaintiffs. Compl. ¶¶ 13, 14, 22. All of these witnesses reside in Peru.
Defendant’s witnesses are also located in Peru. Defendant claims that it intends to
present evidence from Peru to contradict Plaintiffs’ defamation allegations, including the testimony of
Cesar Pereira, an author for a Peruvian newspaper that published the allegedly false statements about
Plaintiffs. Mot. 14. Defendant also contends that it will require the testimony of “members of the
Peruvian Army with direct knowledge of STM’s installation of specific satellite communications
equipment” to demonstrate why the Peruvian Army decided not to pay Plaintiffs and whether
Defendant induced Peruvian officials to break their contractual duties. Id. These witnesses also reside
in Peru.
Clearly, several witnesses in Peru are material to Plaintiffs’ claims and Defendant’s
defenses: members of the Peruvian Army and Peruvian government officials to testify about STM’s
Intentional Interference with Contract claim, and Peruvian press to testify about Mr. Youssefzadeh’s
defamation claims. The Ninth Circuit has indicated that “the initial question is not whether the
witnesses are beyond the reach of compulsory process, but whether it has been alleged or shown that
witnesses would be unwilling to testify.” Carijano, 2011 WL 2138209 at *10. Defendant alleges that
it is “unlikely” that such witnesses would testify voluntarily. Mot. 15. Because this case involves
allegations that Peruvian officials are corrupt, Defendant’s predictions seem probable. More
importantly, Peru is not a signatory to the Hague Convention, which allows signatories to obtain letters
rogatory to compel testimony of foreign witnesses. Mot. RJN Ex. H, 25. As a result, should this action
take place in California, there is no assurance that the parties will be able to compel testimony of
Peruvian witnesses. Even assuming that Plaintiffs will be able to produce sufficient evidence to
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succeed on their claims in California, it is unlikely that Defendant will be able to sufficiently defend
itself. Forcing Gilat to litigate a suit under such circumstances is oppressive.
Considerations of physical evidence also weigh in favor of dismissal. Plaintiffs make the
conclusory statement that “the primary documentary evidence should be in the possession of [STM and
Gilat].” Opp’n 13. Indeed, many emails, contracts, or documents relating to this action, though in Peru,
are within Gilat’s possession. However, as Defendant argues, “[t]he physical satellite communication
installations that STM provided to the Peruvian Army under the contract, which would be material
evidence of STM’s performance or lack thereof, are all located in Peru.” Mot. 17. Thus, considerations
of physical evidence also weigh in favor of dismissal.
Furthermore, unlike in Carijano, Plaintiffs’ claims relate only to conduct that occurred in
Peru. Although “[t]he mere fact that a case involves conduct or plaintiffs from overseas is not enough
for dismissal,” the fact that all relevant conduct took place in Peru bolsters the Court’s confidence that
key witnesses and physical evidence are located in Peru. Carijano, 2011 WL 2138209 (citing Tuazon
433 F.3d 1163, 1181-82). See also Loya v. Starwood Hotels & Resorts Worldwide, Inc., 583 F.3d 656,
659 (9th Cir. 2009) (holding that dismissal for forum non conveniens was appropriate where plaintiff
was a resident of the forum state, but all alleged conduct took place in Mexico); Mizokami Bros., 556
F.2d at 978 (same). Because physical evidence and all identified material witnesses, with the exception
of one, are located in Peru, the evidentiary and convenience factors strongly weigh in favor of dismissal.
See Loya 583 F.3d at 664-66 (affirming the District Court’s dismissal for forum non conveniens where
most witnesses and relevant documentation were located in Mexico); Contact Lumber, 918 F.2d at 1451
(affirming the District Court’s dismissal for forum non conveniens where plaintiff was an American
corporation, but evidence and witnesses were located in the Philippines).
c.

Enforceability of the Judgment

Courts will find the enforceability of the judgment factor to weigh against dismissal if the
defendant does not meet its burden of establishing sufficient assets in the foreign jurisdiction to satisfy a
judgment. See, e.g., Carijano, 2011 WL 2138209 at *11; Empresa Lineas Maritimas Argentinas, S.A. v.
Schichau–Unterweser, A.G., 955 F.2d 368, 375 (5th Cir. 1992). Plaintiffs contend that “[i]t is unclear
what assets Gilat would have to levy upon in Peru,” and, as a result, no judgment could be satisfied
there. Opp’n 14. In Defendant’s Reply, however, Defendants demonstrate that Gilat’s Peruvian
subsidiary has at least three times as many assets than the $2,290,000 Plaintiffs have yet to recover from
the Peruvian Army. Reply 16. Though the amount of damages sought by Plaintiffs is certainly high, the
Court nonetheless has little concern about the enforceability of a Peruvian judgment. To be sure, as the
Court will describe later, the Court sees fit to condition this dismissal on Plaintiffs’ ability to enforce a
Peruvian judgment against Gilat. Thus, this factor does not weigh against dismissal.
2.

Public Interest Factors

The public factors to consider in a forum non conveniens analysis include: “(1) the local
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interest in the lawsuit, (2) the court’s familiarity with the governing law, (3) the burden on local courts
and juries, (4) congestion in the court, and (5) the costs of resolving a dispute unrelated to a particular
forum.” Boston Telecomms., 588 F.3d at 1211 (quoting Tuazon, 433 F.3d at 1181).
The local interest factor helps determine “if the forum in which the lawsuit was filed has
its own identifiable interest in the litigation which can justify proceeding in spite of these burdens.”
Carijano, 2011 WL 2138209 at *12. “There can be no question that the local interest factor weighs in
favor of a California forum where a California plaintiff is suing a California defendant over conduct that
took place in the state.” Id. This is largely because states have an “interest in deciding actions against
resident corporations whose conduct in this state causes injury to persons in other jurisdictions.”
Stangvik v. Shiley Inc., 819 P.2d 14, 21 n.10 (Cal. 1991). Here, however, Defendant is an Israeli
corporation and all allegedly harmful conduct took place in Peru. Thus, California’s present interest in
preventing further harmful conduct in its state is minimal. See Guimei v. Gen. Elec. Co., 91 Cal. Rptr.
3d 178, 190 (Cal. App. 2009) (holding that where defendants were not California corporations,
California “has little interest in keeping the litigation in this state to deter future wrongful conduct”).
Finally, the minimal interest California has in hosting this action is outweighed by Peru’s substantial
interest; because Plaintiffs’ claims involve allegations of government corruption, Peru surely has the
greatest interest in investigating Plaintiffs’ claims and hosting this action.
Taken together, the private and public factors “establish . . . oppressiveness and vexation
to a defendant . . . out of all proportion to plaintiff’s convenience.” Piper, 454 U.S. at 241. All but one
of the material witnesses are located in Peru, as is pertinent physical evidence. Transporting evidence of
the installed satellite communications system, as well as members of the Peruvian Army, government,
and press from Peru to California would be extremely inconvenient and expensive, if not impossible.
However, such evidence is likely necessary for Plaintiffs to prove their claims and for Defendant to
defend itself. California has a minimal interest in keeping this action in its courts because all alleged
wrongful conduct occurred abroad by a foreign defendant. Therefore, the private and public interest
factors support dismissal.
C.

Conditions

The Ninth Circuit recently criticized a district court’s dismissal for forum non conveniens
without imposing any mitigating conditions. See Carijano, 2011 WL 2138209 at *14 (“District courts
are not required to impose conditions on forum non conveniens dismissals, but it is an abuse of
discretion to fail to do so when ‘there is a justifiable reason to doubt that a party will cooperate with the
foreign forum.’” (quoting Leetsch v. Freedman, 260 F.3d 1100, 1104 (9th Cir. 2001))).
The Court requested supplemental briefing on the appropriate conditions it should
consider (Docket 37). After reviewing the parties’ briefs, the Court imposes the conditions listed below,
which it believes will adequately protect Plaintiffs’ ability to litigate this action.
IV.

Disposition

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For the foregoing reasons, the Court GRANTS Defendant’s Motion to Dismiss for forum
non conveniens. The Court’s dismissal is subject to the following conditions:
(1)

Defendant’s agreement to
(a)
(b)

waive any statute of limitations defense it might raise;

(c)

make available any evidence and witnesses within its control that Peruvian
courts properly deem discoverable and relevant; and

(d)
(2)

submit to jurisdiction in Peruvian courts;

enforce any judgment awarded by Peruvian courts; and

A Peruvian court’s acceptance of jurisdiction over Plaintiffs’ claims.

Defendant’s motion to dismiss pursuant to Federal Rule 12(b)(6) (Docket 18) is DENIED
as MOOT.
The Clerk shall serve this minute order on all parties to the action.

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