Oldendorff Carriers GmbH & Co. KG v. Grand China Shipping (Hong Kong) Co Ltd et al

Filing 48

ORDER FOR DISCOVERY Plaintiff's Amended Complaint due by 12/15/2012. Defendants may amend their motion to dismiss and/or submit additional evidence by 12/31/2012. Plaintiff may amend its response to the motion to dismiss and/or submit additional evidence by 1/21/2013.(Signed by Judge Nelva Gonzales Ramos) Parties notified.(amireles, )

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
CORPUS CHRISTI DIVISION
OLDENDORFF CARRIERS GMBH &
CO. KG,
Plaintiff,
VS.
GRAND CHINA SHIPPING (HONG
KONG) CO LTD, et al,
Defendants.

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§ CIVIL ACTION NO. C-12-74
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ORDER FOR DISCOVERY
This case arises from a dispute over a maritime contract between Plaintiff,
Oldendorff Carriers GMBH & Co., KG (Oldendorff) and Defendant Grand China
Shipping (Hong Kong) Co., Ltd. (GCS). Pursuant to the terms of the contract, the
substance of that dispute has been referred to arbitration in London, where it is to be
determined under the law of England. Anticipating a substantial arbitration award,
Oldendorff initiated this ancillary action to arrest the M/V Eagle in order to have
assets from which to collect its anticipated award. The M/V Eagle was arrested and
subsequently released pursuant to Special Release Bond that secures the payment of
any arbitration award while allowing the M/V Eagle to return to service.
Currently before the Court is the Defendants’ claim that Oldendorff has not
alleged a sufficient basis for retaining the benefit of the Special Release Bond
because corporate forms insulate the owner of the M/V Eagle from any liability pled
in this case. More specifically, under Rule 12(b)(6) and the Supplementary Rules for
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Admiralty or Maritime Claims, Defendants have challenged Oldendorff’s pleading of
“single business enterprise” and alter ego theories for piercing corporate veils in
support of jurisdiction over the M/V Eagle and the Bond.
Oldendorff has alleged that GCS, along with the ostensible owners of the M/V
Eagle—Defendants Offshore Heavy Transport AS (OHT) and OHT Eagle AS (OHT
Eagle)—are subsidiaries of Grand China Logistics Holding (Group) Company
Limited (GCL) and that GCL and its parent have held out their entire corporate
family as a single business enterprise. Furthermore, Oldendorff alleges that GCL
dominates each subsidiary in an alter ego manner as part of a strategic plan to isolate
liabilities from assets with corporate walls, contrary to its representations to
participants in the shipping industry such as Oldendorff. The argument is that the
Defendants intentionally induce the appearance of financial strength with the
intention to withdraw financial support from subsidiaries at will in order to leave
creditors without recourse.
In support of their motion to dismiss this action, Defendants OHT and OHT
Eagle have submitted evidence of their separate corporate identity, including a
Declaration of Arne Blystad (D.E. 27-1), Declaration of Jon Christian Syvertsen
(D.E. 27-2), Declarations of Tom Erik Jebsen (D.E. 27-3, 34), and Declaration of
Shen Yi (D.E. 27-4). These Declarations purport to supply factual bases for making
a determination on the merits that Oldendorff’s veil-piercing theories are
unsupported.

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Consideration of this extraneous material converts the motion to dismiss into a
summary judgment motion. Fed. R. Civ. P. 12(d), 56. “All parties must be given a
reasonable opportunity to present all the material that is pertinent to the motion.”
Fed. R. Civ. P. 12(d). See also Fed. R. Civ. P. 56(d). In “Point II” of its “Opposition
to Defendants Offshore Heavy Transport AS and OHT Eagle AS’s Motion to
Dismiss and Expedited Motion to Vacate Attachment” (D.E. 33, p. 18), Oldendorff
seeks the opportunity to conduct discovery to determine the true ownership status of
the M/V Eagle and to support this Court’s jurisdiction to maintain this action.
When a factual question governs the Court's jurisdiction, the Plaintiff must
have ample opportunity to secure and present evidence relevant to the jurisdictional
question. Box v. Dallas Mexican Consulate General, No. 11–10126, 2012 WL
3590695, *3 (5th Cir. Aug. 21, 2012) (citing Hansen v. PT Bank Negara Indon.
(Persero), TBK, 601 F.3d 1059, 1063–64 (10th Cir. 2010); see also McAllister v.
FDIC, 87 F.3d 762, 766 (5th Cir. 1996) (“When a district court makes factual
determinations decisive of a motion to dismiss for lack of jurisdiction, it must give
plaintiffs an opportunity for discovery and a hearing that is appropriate to the nature
of the motion to dismiss”).
For these reasons, the Court ORDERS that the parties engage in jurisdictional
discovery, including the bases for Plaintiff’s veil-piercing theories.

The Court

GRANTS LEAVE to Plaintiff to amend its complaint on or before December 15,
2012. The Court ORDERS that Defendants may amend their motion to dismiss
and/or submit additional evidence on or before December 31, 2012 and that Plaintiff
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may amend its response to the motion to dismiss and/or submit additional evidence
on or before January 21, 2013.
ORDERED this 10th day of October, 2012.

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NELVA GONZALES RAMOS
UNITED STATES DISTRICT JUDGE

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