Imemco Inc v. Lumenis Inc et al

Filing 30

MINUTES (IN CHAMBERS) by Judge David O. Carter: granting 18 Defendants' MOTION to Dismiss Case. ( MD JS-6. Case Terminated ) (twdb)

JS-6
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL

Case No. SA CV 14-1877-DOC (DFMx)

Date: July 27, 2015

Title: IMEMCO INC. v. LUMENIS INC., ET AL.

PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
Deborah Goltz
Courtroom Clerk

Not Present
Court Reporter

ATTORNEYS PRESENT FOR
PLAINTIFF:
None Present

ATTORNEYS PRESENT FOR
DEFENDANT:
None Present

PROCEEDINGS (IN CHAMBERS): ORDER GRANTING
DEFENDANTS’ MOTION TO
DISMISS [18]
Before the Court is Defendants Lumenis Inc. and Lumenis LTD’s (“Defendants”)
Motion to Dismiss (“Motion”) (Dkt. 18). The Court finds this matter appropriate for
resolution without oral argument. Fed. R. Civ. P. 78; L.R. 7-15. Having reviewed the
papers and considered the parties’ arguments, the Court hereby GRANTS Defendants’
Motion and DISMISSES Plaintiff’s case WITH PREJUDICE.
I.

Background
A.

Facts

Plaintiff Imemco Inc. (“Plaintiff”) possesses all right, title and interest previously
held by Iran Memco LTD (“Iran Memco”). Complaint (“Compl”) (Dkt. 1) ¶ 6. In
February 2003, Iran Memco contracted with Lumenis (Holland) BV (“Lumenis
Holland”) to become Lumenis Holland’s exclusive distributor of Aesthetic, Surgical, and
Ophthalmic Laser systems in Iran. Compl. Ex. 4; see generally Decl. of Jessica B. Jensen

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 14-1877-DOC (DFM)

Date: July 27, 2015
Page 2

re: Motion to Dismiss (Dkt. 19), Attach. 1, Ex. 6 (“Agreement”).1 The Agreement
contained the following provision regarding sales commissions:
If a [Lumenis Holland] quote leads to a customer sale and
subsequent customer payment, then [Iran Memco] will receive a
commission.
Agreement at 18. The Agreement also contained the following Forum Selection Clause
This Agreement shall be construed with and governed by the laws of
England and the parties by their execution hereof shall be deemed to
have submitted irrevocably to the exclusive jurisdiction of the
English High Court of Justice.
By June 2007, at which point the business relationship had ended, Lumenis
Holland owed Iran Memco $144,000 in sales commissions (“the Commissions”). Compl.
¶ 11.
When Iran Memco sought to recover the Commissions, it learned the United
States Treasury Department was investigating the transactions giving rise to the sales
Commissions. Id. Ex. 5, 7. Therefore, the funds could not be paid until that investigation
concluded. Id. Ex. 7. To date, the funds have not been paid.
B.

Procedural History

Plaintiff filed suit in the Central District of California on November 26, 2014. See
Compl. The Complaint seeks declaratory relief regarding Plaintiff’s rights to the
Commissions, id. ¶ 19, injunctive relief ordering Defendants to surrender the
Commissions to the Court during the pendency of the action, id. ¶ 24, and an accounting
of Defendants’ records to determine precise amount owed, id. ¶ 30.
Defendants filed a Motion to Dismiss on June 5, 2015. See Mot. Plaintiff did not
file its Opposition to the Motion until June 22, 2015 (“Opp’n”) (Dkt. 23). Rather than
dismiss the matter for failure to oppose, the Court excused Plaintiff’s late filing. See

1
Plaintiff included a portion of the Agreement between Iran Memco and Lumenis Holland as an attachment to its
Complaint. Compl. Ex. 2. Defendants request that the Court take judicial notice of the entire Agreement. Declaration
re: Motion to Dismiss (Dkt. 19), Attach. 1, Ex. 6. The Court will consider the entirety of the Agreement for the
purposes of this Motion. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994), overruled on other grounds by 307
F.3d 1119, 1121 (9th Cir. 2002).

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 14-1877-DOC (DFM)

Date: July 27, 2015
Page 3

Order re: Motion to Dismiss (Dkt. 26). Plaintiffs filed an Amended Reply in Support of
the Motion to Dismiss (“Reply”) (Dkt. 27) on July 6, 2015.
Defendants move to dismiss on four grounds: (1) that Plaintiff’s claims are subject
to the forum selection clause, (2) that Defendant Lumenis LTD was never properly
served, (3) that neither Lumenis LTD nor Lumenis Inc. is a proper party to this suit, and
(4) that Plaintiff’s claims are time-barred.
II.

Legal Standard

Under Federal Rule of Civil Procedure 12(b)(6), a complaint must be dismissed
when a plaintiff’s allegations fail to set forth a set of facts which, if true, would entitle the
complainant to relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Ashcroft v.
Iqbal, 556 U.S. 662, 679 (2009) (holding that a claim must be facially plausible in order
to survive a motion to dismiss). The pleadings must raise the right to relief beyond the
speculative level; a plaintiff must provide “more than labels and conclusions, and a
formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S.
at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). On a motion to dismiss, this
court accepts as true a plaintiff’s well-pleaded factual allegations and construes all factual
inferences in the light most favorable to the plaintiff. See Manzarek v. St. Paul Fire &
Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). The court is not required to accept
as true legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 678.
In evaluating a Rule 12(b)(6) motion, review is ordinarily limited to the contents
of the complaint and material properly submitted with the complaint. Van Buskirk v.
Cable News Network, Inc., 284 F.3d 977, 980 (9th Cir. 2002); Hal Roach Studios, Inc. v.
Richard Feiner & Co., Inc., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). Under the
incorporation by reference doctrine, the court may also consider documents “whose
contents are alleged in a complaint and whose authenticity no party questions, but which
are not physically attached to the pleading.” Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir.
1994), overruled on other grounds by 307 F.3d 1119, 1121 (9th Cir. 2002). The court
may treat such a document as “part of the complaint, and thus may assume that its
contents are true for purposes of a motion to dismiss under Rule 12(b)(6).” United States
v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).
Additionally, the court may take judicial notice of certain items without converting
the motion to dismiss into one for summary judgment. Barron v. Reich, 13 F.3d 1370,
1377 (9th Cir. 1994). For instance, the court may take judicial notice of facts “not subject
to reasonable dispute” because they are either: “(1) [] generally known within the trial
court’s territorial jurisdiction; or (2) can be accurately and readily determined from

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 14-1877-DOC (DFM)

Date: July 27, 2015
Page 4

sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201; see also
Harris v. Cnty. of Orange, 682 F.3d 1126, 1132 (9th Cir. 2012) (noting that the court may
take judicial notice of “undisputed matters of public record,” including “documents on
file in federal or state courts,” as well as “documents not attached to a complaint . . . if no
party questions their authenticity and the complaint relies on those documents”).
Dismissal with leave to amend should be freely given “when justice so requires.”
Fed. R. Civ. P. 15(a)(2). This policy is applied with “extreme liberality.” Morongo Band
of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990); Lopez v. Smith, 203
F.3d 1122, 1127 (9th Cir. 2000) (holding that dismissal with leave to amend should be
granted even if no request to amend was made). Dismissal without leave to amend is
appropriate only when the court is satisfied that the deficiencies in the complaint could
not possibly be cured by amendment. Jackson v. Carey, 353 F.3d 750, 758 (9th Cir.
2003).
III.

Discussion
A.

Subject Matter Jurisdiction

Lumenis LTD argues that it was never properly served. “A federal court is without
personal jurisdiction over a defendant unless the defendant has been served in accordance
with Fed. R. Civ. P. 4.” Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986). However
“where subject-matter or personal jurisdiction is difficult to determine, and forum non
conveniens considerations weigh heavily in favor of dismissal, the court properly takes
the less burdensome course.” Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549
U.S. 422, 436 (2007). The Court therefore need not consider whether Lumenis LTD was
properly served, and will consider as a threshold matter Defendants’ arguments regarding
the forum selection clause.
B.

Forum Selection Clause

Defendants argue that this case is entirely barred by the forum selection clause in
the underlying Agreement. Mot at 8-12. Plaintiff responds that the Agreement is not
implicated because “there is no attempt to secure determination…that monies are due and
owing.” Opp’n at 12:23-24. Rather, Defendants are “acting in the capacity of a ‘trustee’
for the benefit of IRAN MEMCO, holding its funds in constructive trust.” Id at 12:7-9
(internal quotation marks in original). Plaintiff argues that by withholding the
Commissions, Defendants have engaged in “unlawful taking of property of another, and
in this case, probably conversion.” Id. at 12:17-18.

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 14-1877-DOC (DFM)

Date: July 27, 2015
Page 5

“A forum selection clause is ‘prima facie valid and should be enforced unless
enforcement is shown by the resisting party to be ‘unreasonable’ under the
circumstances.’” Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273,
279 (9th Cir. 1984) (quoting The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972)
(internal quotation marks in original)). To avoid a forum selection clause, a party must
show that “enforcement would be unreasonable and unjust, or that the clause was invalid
for reasons such as fraud or overreaching.” The Bremen, 407 U.S. at 15.
In Manetti-Farrow, Inc. v. Gucci America, Inc., 858 F.2d 509 (9th Cir. 1988), the
plaintiff sought to avoid a forum selection clause by arguing its claims were “‘pure’ tort
claims independent of the contract.” Id. at 514 (quotation marks in original). The court
determined that “[w]hether a forum selection clause applies to tort claims depends on
whether the resolution of the claims relates to interpretation of the contract.” Id. The
court concluded that where “[e]ach of [plaintiff’s claims] relates in some way to rights
and duties enumerated in the…contract” that “they are within the scope of the forum
selection clause.” Id; cf. Androutsakos v. M/V PSARA, No. 02-1173-KI, 2004 WL
1305802, at *6 (D. Or. Jan. 22, 2004) (declining to enforce a forum selection clause
“[b]ecause the resolution of plaintiff’s claims…does not involve analyzing in any way
whether the parties were in compliance with the contract.”).
“When [] parties have agreed to a valid forum selection clause, a district court
should ordinarily transfer the case to the forum specified in that clause. Only under
extraordinary circumstances unrelated to the convenience of the parties should a…motion
be denied.” Atl. Marine Constr. Co., Inc. v. U.S. Dist. Court for W. Dist. of Texas, 134 S.
Ct. 568, 581 (2013). But, “the appropriate way to enforce a forum-selection clause
pointing to a state or foreign forum is through the doctrine of forum non conveniens.” Id.
at 580. In deciding whether to transfer or dismiss a case pursuant to a forum selection
clause, “a district court may consider arguments about public-interest factors only,”
giving no weight to plaintiff’s choice of forum or the parties’ private interests. Id. at 58182. “Public interest factors may include the administrative difficulties flowing from court
congestion; the local interest in having localized controversies decided at home; [and] the
interest in having the trial of a diversity case in a forum that is at home with the law.” Id.
at 581 n.6.
C.

Application

The Agreement states “If a [Lumenis Holland] quote leads to a customer sale and
subsequent customer payment, then [Iran Memco] will receive a commission.”

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 14-1877-DOC (DFM)

Date: July 27, 2015
Page 6

Agreement at 18. Plaintiff’s right to the Commissions is therefore a “right[]…enumerated
in the…contract.” Manetti-Farrow, 858 F.2d at 514. In Plaintiff’s own words, “IRAN
MEMCO performed all of its duties under the contract dutifully, and eventually was
owed the sum of not less than one hundred forty thousand dollars.” Opp’n at 4:23-24.
Plaintiff cannot sidestep the forum selection clause by claiming that its right to the
Commissions has “long been resolved and determined.” Opp’n at 12:26. Defendants do
not concede owing any debt to Plaintiff. Mot. at 7:18. Lumenis’ filing with the SEC,
Compl. Ex. 7, is merely evidence of Plaintiff’s right to the Commissions under the
Agreement, it does not create a separate legal entitlement.
Plaintiff cites no authority for its assertions that Defendants are acting as trustees
or that the contract was completed and discharged. Indeed, the nearly two pages of
Plaintiff’s Opposition concerning the forum selection clause lack a single citation. See
generally Opp’n at 11-13. Plaintiff has made no arguments that the clause is
unreasonable, unjust, or invalid. See generally Opp’n. Although Plaintiff mentions that
United States law is implicated, it fails to establish that enforcing the clause would be
unreasonable.
Thus, the Court concludes that the Forum Selection Clause is valid and
enforceable. As this matter cannot be transferred to the proper court, it shall be
DISMISSED WITH PREJUDICE. As this matter shall be dismissed with prejudice, the
Court need not address Defendants’ remaining arguments.
IV.

Disposition

For the reasons set forth above, Defendants’ Motion to Dismiss is GRANTED,
and Plaintiff’s Complaint is DISMISSED WITH PREJUDICE. The Clerk shall serve this
minute order on the parties.
MINUTES FORM 11
CIVIL-GEN

Initials of Deputy Clerk: djg