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Bigio v. Coca Cola
United States District Court for

the Southern District of New
York

IV.

OTHER GROUNDS THAT WERE NOT INVOKED BY THE TRIAL COURT DO NOT WARRANT DISMISSAL

 A. Comity Is Not a Basis for Dismissing the Complaint.

Dismissal on grounds of comity is completely inappropriate in this case. First, "the principle of comity does not limit the legislature’s power," and thus "has no application where Congress has indicated otherwise." In re Maxwell Communication Corp., 93 F.3d 1036, 1047 (2d Cir. 1996) (citing Romero v. International Terminal Operating Co., 358 U.S. 354, 382 (1959) (stating that comity only applies "in the absence of a contrary congressional direction"). Here, Congress’s enactment of the ATCA manifests an unambiguous intent to vest jurisdiction in United States courts for violations of the law of nations. Indeed, Coca-Cola cites no case, and we are aware of none, that refused to hear a claim under the ATCA on grounds of comity.

Second, declining jurisdiction on grounds of comity "is only appropriate if [doing so] is consistent with United States government policy." Pravin Banker Assocs., Ltd., v. Banco Popular Del Peru, 109 F.3d 850, 855 (2d Cir. 1997) (affirming trial court’s refusal to extend comity to foreign proceedings because doing so would be contrary to United States policy). Coca-Cola, which carries the burden of proving that comity requires dismissal, (Allstate Life Ins. Co. v. Linter Group, Ltd., 994 F.2d 996, 999 (2d Cir. 1993)), has not done so and cannot do so. It is hardly in the interest of the United States to deny a forum to Canadian citizens to recover damages against an American corporation that knowingly acquired stolen property.

Even if this were a case in which principles of comity were applicable, it would be inappropriate for this Court to dismiss this case without making two fact-bound determinations that cannot be made on this record. In Jota v. Texaco, 157 F.3d 153 (2d Cir. 1998), the trial court dismissed an ATCA and trespass case8, on the grounds of comity, failure to join an indispensable party, and forum non conveniens9. This Court reversed and held that dismissal on comity grounds is warranted only if "an adequate forum exists in the objecting nation" and "the defendant sought to be sued in the United States forum is subject to or has consented to the assertion of jurisdiction against it in the foreign forum." Id. 160. Neither finding was made by the trial court in this case, and the record refutes such findings. 10

 B. Failure to Join an Indispensable Party Is Not a Ground for Dismissing the Complaint.

Coca-Cola’s contention that this matter should be dismissed for lack of joinder of two allegedly indispensable parties — Egypt and MISR — is also foreclosed by this Court’s decision in Jota. A three-step inquiry governs whether an action should be dismissed for failure to join an indispensable party: (1) whether the party is "necessary," under Rule 19(a); (2) whether joinder is feasible; and (3) if a necessary party cannot be joined, whether the matter should be dismissed under Rule 19(b)’s four-factor test. "Rule 19(b) does not authorize dismissal simply because [a necessary] party cannot be joined." Jota, 157 F.3d at 162.

Assuming, arguendo, that Egypt and MISR are both necessary and cannot be joined11, Jota nonetheless authorizes this action to proceed in their absence. The plaintiffs in Jota sought money damages and "‘equitable relief to remedy the contamination and spoliation of their properties, water supplies, and environment.’" Id. at 156. The trial court dismissed the action for failure to join an indispensable party, finding that Ecuador was necessary and incapable of being joined. This Court reversed because it concluded that the absence of Ecuador would only prevent recovery of the few equitable claims requiring Ecuador’s participation. But "since much of the relief sought could be fully provided by Texaco without any participation by Ecuador," this Court said that the trial court abused its discretion in dismissing the entire complaint. Id. at 162.

Unlike the plaintiffs in Jota, the Bigios only seek relief from Coca-Cola. They do not seek any damages from any other entity. Nor do they seek any equitable relief — such as ejectment of the current trespassers — that may require the Court to exercise jurisdiction over Egypt or any Egyptian governmental entity. Thus, even if Egypt and MISR were necessary and incapable of being joined, this action should not be dismissed for failure to join an indispensable party.

C. The Bigios’ Cause of Action Under The ATCA is Timely.

Coca-Cola’s contention that the Bigios’ cause of action under the ATCA is time-barred does not withstand scrutiny because the continuing nature of   Coca-Cola’s tortious conduct negates the application of this affirmative defense.12

Since the ATCA contains no statute of limitations, courts must apply the limitations period of the most analogous statute. This Court, however, need not decide whether to apply the ten-year limitations period of the Torture Victims Protection Act, Pub. L. No. 102-256, 106 Stat. 73 (1992), as did Cabiri v. Assasie-Gyimah, 921 F. Supp. 1189, 1194-97 (S.D.N.Y. 1996), or the three-year limitations period of an analogous state law, as Coca-Cola urges, because the Bigios’ cause of action is timely under either.

The expropriation of the Bigios’ property is "akin to a continuing trespass — a situation in which a new cause of action arises in plaintiffs’ favor . . . each day." Greene v. Town of Blooming Grove, No. 87 CIV. 0069 (SWK), 1988 WL 126877 (S.D.N.Y. Nov. 18, 1988), aff’d in part and rev’d in part on other grounds, 879 F.2d 1061 (2d Cir. 1989). This Court has explained that "despite the general principle that a cause of action accrues when the wrong is done, regardless of when it is discovered, certain wrongs are considered to be continuing wrongs, and the statute of limitations, therefore, runs from the commission of the last wrongful act." Leonhard v. United States, 633 F.2d 599, 613 (2d Cir. 1980) (citation omitted). This doctrine is recognized by both the law of the forum state13 and federal law. 14

The expropriation of the Bigios’ properties is a continuing violation in the nature of a trespass that remains unabated to this day. Coca-Cola profited from its occupation of the Bigios’ land after Nasser’s unlawful expropriation and the full nature and extent of Coca-Cola’s involvement in, and/or benefit from, that expropriation are issues of fact that can only be determined through discovery. See, e.g. Black Radio Network, Inc. v. NYNEX Corp., No. 96 Civ. 4138, 96 Civ. 4139, 96 Civ. 4141 (D.C.), 1999 U.S. Dist. LEXIS 4870 (S.D.N.Y. April 13, 1999) (denying motion for summary judgment because issues of fact precluded determination of application of statute of limitations) (citation omitted).

D. The Bigios’ Complaint States a Claim Upon Which Relief Can Be Granted.

Coca-Cola cites no authority for its sweeping argument absolving itself of all liability for its conduct in this case.

The law does not excuse torts committed by incorporated entities, and the Bigios need not pierce the corporate veil where, as here, the defendants directed — and acted in concert with — its subsidiaries and others in committing the tortious acts at issue. See, e.g., Fletcher v. Atex, 68 F.3d 1451, 1464-66 (2d Cir. 1995) (discussing corporate parent’s liability for acting in tortious concert with its subsidiaries) (citing Restatement (Second) of Torts 876 (1977), liability for acting in concert with another); Nika Corp. v. City of Kansas City, Mo., 582 F. Supp. 343 (W.D. Mo. 1983) (finding parties that directed another to convert property liable as if they had converted property themselves) (citing Restatement (Second) of Torts 877 (1977), liability for directing or permitting conduct of another); Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259 (9th Cir. 1996) (corporation liable for trademark and copyright infringement based upon theories set forth in 876-77 of Restatement). 15

The Complaint and Mr. Bigio’s sworn affidavit amply demonstrate that the defendants acted in concert with and directed the conduct of subsidiaries and others in knowingly acquiring the Bigios’ property. Coca-Cola witnessed the unlawful expropriation as a tenant and a customer of the Bigios in the early 1960’s (Complaint 6 (JA 6-7)); (Bigio Aff. 3, 5 (JA 27, 28)). With this knowledge, in 1994 the defendants "began negotiations with the [ENBC] . . . through a consortium . . . for the purchase of plaintiffs’ property for approximately $100,000,000" (Complaint 11 (JA 8)).

In February 1994, prior to the acquisition, Mr. Bigio advised Coca-Cola in writing of the Bigios’ rights to the property and land (Bigio Aff. 16 (JA 33)). Coca-Cola officials agreed to a meeting in May 1994. A few days before the meeting, an attorney from Coca-Cola called Mr. Bigio to question whether a meeting would be fruitful in light of the fact that Coca-Cola had just consummated the transaction (Bigio Aff. 16 (JA 33)). Coca-Cola’s subsequent description in its 1994 Form 10K of its purchase of the Heliopolis properties indicate that it was the driving force in the acquisition (Bigio Aff. 21 (JA 8-9)):

When considered appropriate the Company makes equity investments in bottling companies. Through these investments, the Company is able to help focus and improve sales and marketing programs, assist in the development of effective business and information systems and help establish capital structures appropriate for these respective operations. For example, the joint venture known as The Coca-Cola Bottling Companies of Egypt was formed in the second quarter of 1994 following the privatization of the Egyptian bottler which was previously government owned. The Company is a minority shareholder, with MAC Investments of Egypt as a majority shareholder.

In sum, the Bigios plainly state a claim upon which relief can be granted against the defendants for tortiously acquiring the Heliopolis factories and land through a consortium of entities that it directed and with whom it acted in concert.


FOOTNOTES:

8. Counsel for Coca-Cola fails to cite this 1998 controlling authority, which is particularly surprising considering that counsel for Coca-Cola represented defendant Texaco in this Court and in the trial court. Instead, Coca-Cola contends that this Court’s comity analysis should be governed by a balancing test set out in Timberlane Lumber Co. v. Bank of America Nat’l Trust & Sav. Ass’n, 749 F.2d 1378 (9th Cir. 1984), of which Coca-Cola cites two factors (Coca-Cola Br. 50-51). A cursory review of Timberlane reveals, however, that it sets forth a three-part balancing test (with seven factors in the third part) that governs whether United States antitrust laws should be given extraterritorial effect. Coca-Cola cites only two of the seven factors contained within the third part of the balancing test and omits entirely parts one and two of the balancing test. Those two parts demonstrate that the Timberlane balancing test is completely irrelevant because they require an inquiry into restraints of trade and the Sherman Act.

9. Coca-Cola has apparently abandoned its argument that this case should be dismissed on grounds of forum non conveniens.

10. Should this Court determine that the trial court must re-examine this issue on remand, we request discovery to prove that an "adequate forum" does not exist in Egypt for the adjudication of these claims. Drexel Burnham Lambert Group, Inc. v. Galadari, 777 F.2d 877, 880-81 (2d Cir. 1985).

11. We have serious doubts about whether Egypt and MISR are, in fact, "necessary" and incapable of being joined. The court in National Coalition Gov’t of the Union of Burma v. Unocal, 176 F.R.D. 329, 357 (C.D. Cal. 1997), after careful consideration, squarely rejected Unocal’s contention that the Burmese government was "necessary" to that ATCA claim for human rights abuses arising out of a joint venture between Unocal and Burma to construct a gas pipeline. In addition, Coca-Cola inaccurately contends (Coca-Cola Br. 56) that Egypt and MISR could not be joined because there is no applicable exception to the Foreign Sovereign Immunities Act, 28 U.S.C. 1604. The international takings exception to the FSIA is plainly applicable and may well provide jurisdiction for any claims against MISR and Egypt. See, e.g., Siderman de Blake, 965 F.2d at 711-713 (finding that discriminatory expropriation satisfied international takings exception to FSIA).

12. Coca-Cola apparently concedes that the Bigios’ causes of action under the diversity-of-citizenship statute for Coca-Cola’s 1994 acts of trespass, conversion, and unlawful expropriation of their property rights pursuant to 712 of the Restatement are timely filed (Coca-Cola Br. 57-58).

13. Drury v. Tucker, 210 A.D.2d 891, 892, 621 N.Y.S.2d 822 (App. Div. 4th Dep’t 1994) (state tort law action not time-barred because "plaintiff sufficiently set forth concrete factual allegations of a continuing course of conduct that terminated within one year" of commencement of the action) (citation omitted); Neufeld v. Neufeld, 910 F. Supp. 977, 982 (S.D.N.Y. 1996) ("New York law generally recognizes that the applicable statute of limitations will be tolled until a continuing harm ceases.").

14. Cornwell v. Robinson, 23 F.3d 694, 704 (2d Cir. 1994) (applying doctrine in suit under 42 U.S.C. 1983 and 1985); Palmer v. Kelly, 17 F.3d 1490, 1496 (D.C. Cir. 1994) (applying continuous tort doctrine in Title VII case).

15. The trial court made no findings of fact on this issue and denied the Bigios’ request for permission to file a memorandum demonstrating that the defendants "acted in concert with, or directed the conduct of, their subsidiaries" (JA 188)

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