Maval Capital, Inc. et al v. Marine Transport Logistics, Inc. et al

Filing 22

MEMORANDUM AND ORDER dated 4/22/14 that the matter is respectfully referred to Magistrate Judge Mann for all pretrial matters, including determination of an appropriate bond. ( Ordered by Judge Sandra L. Townes on 4/22/2014 ) (Guzzi, Roseann)

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UNITED ST ATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

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Maval Capital., !AM &AL Group and
Maxim Ostrovskiy,
MEMORANDUM AND ORDER
Plaintiffs,
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Marine Transport Logistics, Inc., Royal
Finance Group, Inc., and Car Express &
Import Inc., Alelsandr Solovyev and Dimitry
Alper,
Defendants.

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TOWNES, United States District Judge,
Maxim Ostrovskiy, and his companies, MAVL Capital, Inc. and !AM & AL Group Inc.,
(collectively, "Plaintiffs") bring this maritime action against (I) Marine Transport Logistics, Inc.,
("MTL"), and its director, Dimitry Alper, and (2) Aleksandr Solovyev his companies, Royal
Finance Group, Inc. and Car Express & Import Inc., (collectively, "Defendants"). Plaintiffs are
is the business of exporting cars to Europe. Defendants are in the business of financing and
shipping the cars. Plaintiffs claim that Defendants have taken some of Plaintiffs' cars and car
parts hostage in an attempt to extort payment for "an unlawful debt conjured up by Defendants"
in violation of maritime law. (Pl. 's Br. at 7.) Plaintiffs sought a preliminary injunction directing
Defendants to immediately release the cargo. At an April 22, 2014 hearing before District Judge
Sandra L. Townes, Plaintiffs voluntarily withdrew their application for a preliminary injunction.
The parties indicated at the hearing that they are negotiating a bond to release the liens on
Plaintiffs' cargo. The matter is respectfully referred to Magistrate Judge Marm for all pretrial
matters including the outstanding issue of setting the bond amount.

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BACKGROUND
A. The Parties
Plaintiffs are in the business of purchasing vehicles from within the United States and
from abroad, and then exporting those vehicles to customers in Europe. Defendants are in the
business of financing the purchase of vehicles, storing vehicles, and shipping them to foreign
ports, including the Port ofKotka, Finland. Specifically, Defendant MTL, of which Defendant
Alper is the director, is a licensed Non-Vessel Operating Common Carrier regulated by the
Federal Maritime Commission. MTL arranges for cargo to be delivered to one of its United
States storage facilities, consolidates the cargo, and then retains ocean carriers to perform the
overseas carriage. Defendant Solovyev is principal of Royal Finance Group, Inc., which
finances the purchase of vehicles, and Car Express & Import Inc., which purchases used and
salvaged cars from auctions and dealerships for sale to its customers. MTL and Car Express
have a mutual referral arrangement.
B. The Dispute
Between January and August of2013, Plaintiffs engaged MTL to ship cars abroad.
According to Plaintiffs, the financing arrangement/ownership status of each car was one of the
following: (I) Plaintiffs owned some of the cars outright; (2) foreign customers had already paid
Plaintiffs, in whole or in part, for some of the cars; and (3) Defendant Royal Finance Group
provided financing for some of the cars and, in exchange, MTL was to be the exclusive shipping
agent for those cars. Plaintiffs agreed to pay for shipping and delivery, inclusive of all freight
and charges. In addition, for cars financed by Defendants, Plaintiffs agreed to pay a flat fee of
2.5% of the amount financed at the time of delivery.

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Sometime in August 2013, the parties' relationship soured. The parties disagree as to
what caused this. Plaintiffs imply that they worked out a more favorable arrangement with
another shipping company, and maintain that the problems began after they notified Defendants
of their intent to wind down their relationship. Defendants claim that they require - as spelled
out expressly in each bill of lading-that all outstanding charges for MTL's services be fully
paid before releasing any cargo and they are simply collecting on outstanding shipping and
storage charges. Regardless of the cause, the result of the souring was that in August of2013,
when some of Plaintiffs' cars and car parts were in Defendants' possession, Defendants
demanded that Plaintiffs promptly pay certain outstanding shipping, freight, storage, and other
charges. When Plaintiffs did not pay, Defendants refused to release that cargo.
Plaintiffs contend that Defendants do not have a valid lien on the vehicles because
Plaintiffs have already paid Defendants "in full for all shipping and storage charges." (Pl. 's Br.
at 7.) Defendants dispute this allegation. They allege that they have valid (both maritime and
contractual) 1 liens on the cargo due to Plaintiffs' current and prior debts. (Defs.' Br. at 17; see
also Alper Deel., Exs. F, H, J, Kand L.)
C. Plaintiffs' Complaint

By complaint filed December 12, 2013, Plaintiffs commenced this action seeking to
recover "in excess of' $1 million in compensatory and punitive damages. The complaint
principally alleges federal question jurisdiction, stating that this action is brought pursuant to the
Carriage of Goods by Sea Act ("COGSA"), 46 U.S.C. § 30701, the Shipping Act of 1984, 46
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See The Bird of Paradise, 72 U.S. 545, 554 (1866); In re World Imports, Ltd. Inc., 498
B.R. 58, 63-64 (Bankr. E.D. Pa. 2013) (citing Tienshan, Inc. v. Tianjin Hua Feng Transport
Agency Co., Ltd., 2011WL7144007, at *17 (Mar. 9, 2011, F.M.C.) (emphasis added); see also
NH Shipping Corp. v. Freights of SIS Jackie Hause, 181 F. Supp. 165, 169 (S.D.N.Y. 1960);
Maersk-Sealand v. Eurocargo Express, LLC, CV 02-3230 MLG, 2004 WL 1950372, at *3-5
(C.D. Cal. Apr. 8, 2004).
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U.S.C. §40101, et seq., and "the court's original jurisdiction in maritime matters." (Comp!. at 'If
29.) Plaintiffs' pleading focuses largely on the maritime aspects of the case. Plaintiffs assert that
they paid the amounts due for the shipping, and that Defendants should have released the cars.
Plaintiffs claim that the failure to do so violated the Shipping Act of 1984 by, in effect, imposing
an unlawful tariff and breached the fiduciary duties that Defendants owed to Plaintiffs as agents.
Plaintiffs further allege various state-law causes of action (conversion, civil conspiracy, tortious
interference with business relations, action to piece the corporate veil, breach of contract,
common-law fraud and a violation ofN.Y. Gen. Bus. Law§ 349). Finally, Plaintiffs allege a
Civil RICO violation.

D. Bond Dispute
Defendants are amenable to releasing the liens on Plaintiffs' cargo if Plaintiffs post a
bond. However, the parties have not reached agreement on the amount of the bond. Defendants
request $86,558. Plaintiffs suggest $1,960. The issue of setting the appropriate bond amount is
respectfully referred to Magistrate Judge Mann.

CONCLUSION
The matter is respectfully referred to Magistrate Judge Mann for all pretrial matters,
including determination of an appropriate bond.

SO ORDERED

/s/(SLT)

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lsANDRA "To-wNEs" 1
United States District Judge
Dated: Brooklyn, New York
April i).,:J.. , 2014
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