Robinson v. TCI/US West Cable Communications Inc. , 117 F.3d 900 ( 1997 )

REVISED
United States Court of Appeals,
Fifth Circuit.
No. 96-50554.
Alan ROBINSON, Plaintiff-Appellant,
v.
TCI/US WEST COMMUNICATIONS INC., TeleWest Communications PLC,
U.S. West Inc., Telecommunications, Inc., Stephen Davidson, Gary
Bryson, Kleinwort Benson Limited, and Kleinwort Benson of North
America, Defendants-Appellees.
July 28, 1997.
Appeal from the United States District Court for the Western
District of Texas.
Before SMITH, BARKSDALE and BENAVIDES, Circuit Judges.
JERRY E. SMITH, Circuit Judge:
Alan Robinson appeals the dismissal of his complaint for lack
of subject matter jurisdiction and, in the alternative, forum non
conveniens ("f.n.c."). We reverse in part, vacate in part, and
remand.
I.
In 1983, Robinson, an English citizen and resident, helped
found Croydon Cable Television Limited ("CCTV"), one of the first
cable franchises in England. Robinson owned only a minority
interest in the company; most of CCTV's funding came from
Cablevision UK Limited ("CUK"), a Florida limited partnership.
CCTV and CUK formed a partnership known as the Croydon Cable
Joint Venture ("CCJV"). In 1989 CUK was sold to United Artists
Cable ("UAC"), an American corporation. CUK's new owner
1
re-registered it as a Colorado partnership and renamed it the
United Artists Partnership ("UAP"). CCJV was dissolved and
reformed, with UAP taking the former CUK's place in the
partnership.
Robinson also owned a majority interest in the predecessor to
United Artists Communications (London South) PLC ("United
Artists"), the English holding company for the cable franchise
licenses that CCTV and the CCJV needed to do business. Prior to
the key events in this case, he sold this interest to TCI/US West
Cable Communications, Inc., ("TCI/US West"), a Colorado
corporation. He retained, however, a separate 3.85% interest in
United Artists that, through United Artists'S 25% participation in
CCTV, effectively gave him his minority interest in the latter
entity.
Soon after the sale of CUK to UAC, disagreements ensued
between Robinson and Jim Dovey, the UAC executive in charge of the
company's English cable interests. Dovey tried to persuade
Robinson to trade his interest in CCTV for a non-voting interest;
Robinson refused. In late 1989, Robinson brought suit in England
against United Artists and three other English defendants, all of
whom Robinson alleges were either directly or indirectly controlled
by Tele Communications, Inc. ("TCI"), and U.S. West, Inc. ("U.S.
West"), two American corporations.
The parties to the lawsuit began settlement negotiations that
Robinson alleges were directed from Denver, Colorado, by TCI and
U.S. West. During the negotiations, TCI and U.S. West formed
2
TeleWest Communications PLC ("TeleWest"), an English corporation
consisting of a number of English cable franchises in which the two
companies had majority interests.
By the fall of 1993, the state of affairs was this: Robinson
owned a 3.85% interest in United Artists. United Artists was a 25%
participant in CCTV, which by this time had changed its name to the
London South Joint Venture ("LSJV"). The majority of United
Artists's stock was held by TCI, U.S. West, or companies controlled
by the two (such as TCI/US West, which Robinson alleges was "the
mere shell company or "designee' of United Artists"). Robinson was
a thorn in the side of TCI and U.S. West, or at least of the
entities they controlled. They wanted him out and were in the
process of negotiating what it would cost.
Robinson alleges that in April 1993, he spoke on the phone
with Gary Bryson, a U.S. West executive in Denver. Bryson told
Robinson that U.S. West wanted to settle the English lawsuit and
that, to that end, Robinson should negotiate with his subordinate,
Stephen Davidson, TeleWest's new finance director. Robinson
alleges that his negotiations with Davidson proceeded with the
understanding that Davidson was acting on Bryson's authority. He
claims, for example, that Davidson frequently indicated that he
needed approval on certain matters from Denver. Robinson also
claims that in September 1993, Davidson phoned him from Denver and
requested that documents be faxed to him at that location.
After lengthy negotiations, Robinson and Davidson reached a
settlement. According to Robinson, the agreement was that he would
3
sell TCI/US West his United Artists shares in exchange for two
payments, one to occur at the time the shares were signed over and
one to occur later. The immediate payment was to give Robinson
£790,360 in cash. The second payment was to occur within thirty
days of the first of three triggering events: (1) the listing of
United Artists (or any direct or indirect holding company) on the
International Stock Exchange in London or any other stock exchange;
(2) the sale of a controlling interest in United Artists; or (3)
the passage of December 31, 1999. Robinson maintains that the
interest he retained in this second payment was a security within
the meaning of U.S. securities laws.
If the triggering event turned out to be the first of these,
a merchant bank would be required to do a valuation of the LSJV,
and Robinson would be paid according to a specified formula based
on the valuation. Robinson alleges that his primary concern during
the negotiations was that he be paid the full value of his
interest. To that end, he says, he liked this scheme, because
Davidson told him the valuation used for computing his payment
would be the same one used in preparation for the stock offering.
Thus, because it would be in TCI/US West's (and, therefore, in TCI
and U.S. West's) interest to get a high valuation, he would be
protected from an artificially low estimate.
Robinson got his £790,360 as promised. In November 1994,
TeleWest purchased the assets of TCI/US West, including United
Artists and the LSJV. The next day, TeleWest stock was offered for
sale on both the London Stock Exchange and the NASDAQ. The stock
4
was marketed throughout the United States.
In preparation for its initial public offering, TeleWest
requested a valuation from Kleinwort Benson ("KB"), an English
merchant bank, and Kleinwort Benson of North America ("KBNA"), its
American counterpart. For purposes of its representations to the
public, KB valued the company at $540,000,000. Robinson alleges
that under the formula in the settlement agreement, this valuation
would have made his retained interest worth $9,000,000.
Unfortunately for Robinson, however, TeleWest instructed KB to
prepare a second and separate valuation for purposes of determining
the value of his stock under the settlement agreement. According
to Robinson, the letter instructing KB to prepare this second
valuation was drafted by, and faxed from, U.S. West's legal
department. From there, he claims, it went to TeleWest, which in
turn sent the letter to KB on TCI/US West's letterhead. KB
conducted the second valuation, which when plugged into the formula
resulted in a value of zero for Robinson's stock.
In December 1995, Robinson filed suit in federal court,
alleging two rule 10b-5 causes of action,1 RICO claims, and various
state law claims. His first rule 10b-5 claim is that the
defendants made an untrue statement of a material fact in
connection with Robinson's sale of his stock to them, in violation
of rule 10b-5(2); the second is that the defendants employed a
device, scheme, or artifice to defraud him in connection with the
sale of his securities, in violation of rule 10b-5(1).
1
See 17 C.F.R. § 240.10b-5.
5
The defendants filed motions to dismiss based on lack of
subject matter jurisdiction, lack of personal jurisdiction,
improper venue, and f.n.c. Robinson requested leave to conduct
discovery on the jurisdictional issues, which the district court
denied. On June 12, 1996, the court dismissed the case for lack of
subject matter jurisdiction and, in the alternative, for f.n.c.
II.
Robinson contends that the dismissal for lack of subject
matter jurisdiction was erroneous for four independent reasons:
(1) The district court ignored Robinson's allegations that TeleWest
and the other English defendants were controlled by American
entities such as TCI, U.S. West, and Bryson; (2) the letter
instructing KB to perform a second valuation of the LSJV was
written by, and sent from, the legal department of U.S. West, an
American corporation; (3) the defendants' scheme utilized the
NASDAQ, an American stock exchange, to defraud him; and (4) the
district court reached its conclusion on subject matter
jurisdiction without allowing Robinson discovery, notwithstanding
the fact that it resolved factual disputes raised by the parties'
conflicting affidavits. As we find the second of these arguments
dispositive, we need not consider the others.
A.
In general, we review a dismissal for lack of subject matter
jurisdiction de novo, using the same standard as applied by the
6
district court.2 Dismissal is proper only when "it appears certain
that the plaintiffs cannot prove any set of facts in support of
their claim which would entitle them to relief."3 A court may base
its disposition of a motion to dismiss for lack of subject matter
jurisdiction on (1) the complaint alone; (2) the complaint
supplemented by undisputed facts; or (3) the complaint
supplemented by undisputed facts plus the court's resolution of
disputed facts.4 Where, as here, the district court has relied on
the third of these bases and has made jurisdictional findings of
fact, those findings are reviewed for clear error. Williamson v.
Tucker, 645 F.2d 404, 413 (5th Cir. May 1981).
B.
Robinson's allegations require us to confront the rather
nebulous issue of the extent to which the American securities laws
may be applied extraterritorially. The Securities Exchange Act of
1934—the legislation on which Robinson's rule 10b-5 claims are
based—is expressly intended
to require appropriate reports, to remove impediments to and
perfect the mechanisms of a national market system for
securities and a national system for the clearance and
settlement of securities transactions and the safeguarding of
securities and funds related thereto, and to impose
2
McAllister v. Federal Deposit Ins. Corp., 87 F.3d 762, 765
(5th Cir.1996); Whatley v. Resolution Trust Corp., 32 F.3d 905,
907 (5th Cir.1994).
3
Saraw Partnership v. United States, 67 F.3d 567, 569 (5th
Cir.1995) (internal quotations omitted) (quoting Hobbs v. Hawkins,
968 F.2d 471, 475 (5th Cir.1992)).
4
Ynclan v. Department of the Air Force, 943 F.2d 1388, 1390
(5th Cir.1991); MCG, Inc. v. Great W. Energy Corp., 896 F.2d 170,
176 (5th Cir.1990).
7
requirements necessary to make such regulation and control
reasonably complete and effective, in order to protect
interstate commerce, the national credit, the Federal taxing
power, to protect and make more effective the national banking
system and Federal Reserve System, and to insure the
maintenance of fair and honest markets in such transactions.
15 U.S.C. § 78b. Section 10(b) of the Exchange Act, under which
rule 10b-5 was promulgated, forbids "any person, directly or
indirectly, by the use of any means or instrumentality of
interstate commerce or of the mails" from using "any manipulative
or deceptive device" prohibited by the SEC "in connection with the
purchase or sale of any security." 15 U.S.C. § 78j. "Interstate
commerce" is defined as "trade, commerce, transportation, or
communication among the several States, or between any foreign
country and any State, or between any State and any place or ship
outside thereof." 15 U.S.C. § 78c(a)(17). The act vests exclusive
jurisdiction to adjudicate suits brought under § 10(b) in the
federal district courts. 15 U.S.C. § 78aa.
As many previous courts have noted, however, with one small
exception the Exchange Act does nothing to address the
circumstances under which American courts have subject matter
jurisdiction to hear suits involving foreign transactions.5 That
exception, a provision governing those who conduct an
extraterritorial "business in securities," see 15 U.S.C. § 78dd(b),
does not apply in this case, as none of the parties is alleged to
5
See, e.g., MCG, 896 F.2d at 173; Itoba Ltd. v. LEP Group
PLC, 54 F.3d 118, 121 (2d Cir.1995), cert. denied, --- U.S. ----,
116 S. Ct. 703, --- L.Ed.2d ---- (1996); Zoelsch v. Arthur Andersen
& Co., 824 F.2d 27, 29-30 (D.C.Cir.1987); Bersch v. Drexel
Firestone, Inc., 519 F.2d 974, 993 (2d Cir.1975).
8
have conducted a "business in securities" anywhere.6
This court is thus faced with the task, as we previously have
termed it, of "fill[ing] the void" created by a combination of
congressional silence and the growth of international commerce
since the Exchange Act was passed in 1934. MCG, 896 F.2d at 173.
The courts that have previously addressed this problem have created
two basic tests for subject matter jurisdiction: the "conduct"
test, which in essence asks whether the fraudulent conduct that
forms the alleged violation occurred in the United States, and the
"effects" test, which asks whether conduct outside the United
States has had a substantial adverse effect on American investors
or securities markets.7 Either may independently establish
jurisdiction. As Robinson does not argue that jurisdiction is
predicated on adverse effects, however, we need concern ourselves
only with the conduct test.8
The circuits are divided as to precisely what sort of
activities are needed to satisfy the conduct test, although all
agree that it is based on the idea that Congress did not want "the
United States to be used as a base for manufacturing fraudulent
6
Cf. Schoenbaum v. Firstbrook, 405 F.2d 200, 207-08 (2d
Cir.1968), overruled on other grounds, 405 F.2d 215 (2d Cir.1968)
(en banc).
7
See, e.g., Leasco Data Processing Equip. Corp. v. Maxwell,
468 F.2d 1326, 1334-37 (2d Cir.1972) (discussing conduct test);
Schoenbaum, 405 F.2d at 206-08 (discussing effects test).
8
See Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S.
804, 809 n. 6, 106 S. Ct. 3229, 3233 n. 6, 92 L. Ed. 2d 650 (1986)
("Jurisdiction may not be sustained on a theory that the plaintiff
has not advanced.").
9
security devices for export, even when these are peddled only to
foreigners." IIT v. Vencap, Ltd., 519 F.2d 1001, 1017 (2d
Cir.1975). The more restrictive position—that the domestic conduct
must have been "of material importance" to or have "directly
caused" the fraud complained of—is followed in the Second and
District of Columbia Circuits.9
The discussion in Psimenos is perhaps the most complete
statement of the test. Where (as here) the alleged fraud is in
connection with a sale of securities to a foreigner outside the
United States, the federal securities laws apply only if acts or
culpable failures to act within the United States directly caused
the plaintiff's loss. Psimenos, 722 F.2d at 1045 (quoting Bersch,
519 F.2d at 993). Thus, "foreign plaintiffs' suits under
anti-fraud provisions of the securities laws [will] be heard only
when substantial acts in furtherance of the fraud were committed
within the United States"; activities that are "merely
preparatory" will not support jurisdiction in and of themselves.
Id. at 1045-46 (citing Vencap, 519 F.2d at 1018). The District of
Columbia Circuit has expressly adopted the Second Circuit's caselaw
in this regard. See Zoelsch, 824 F.2d at 33.10
9
See Itoba, 54 F.3d at 122; Psimenos v. E.F. Hutton & Co.,
722 F.2d 1041, 1045-46 (2d Cir.1983); IIT v. Cornfeld, 619 F.2d
909, 918-21 (2d Cir.1980); Bersch, 519 F.2d at 993; Leasco, 468
F.2d at 1335-37; Zoelsch, 824 F.2d at 31-33.
10
Some courts, including the District of Columbia Circuit in
Zoelsch, have suggested that the Second Circuit's test requires all
elements of the alleged fraud to have occurred domestically. See
Zoelsch, 824 F.2d at 31 ("The Second Circuit's rule seems to be
that jurisdiction will lie in American courts where the domestic
conduct comprises all the elements ... necessary to establish a
10
The Third, Eighth, and Ninth Circuits, in contrast, generally
require some lesser quantum of conduct.11 To the extent that these
cases represent a common position, it appears to be that the
domestic conduct need be only significant to the fraud rather than
a direct cause of it.12
The remaining circuits, including ours, do not appear to have
taken sides in this debate.13 Only two Fifth Circuit cases have
ever addressed the subject. In United States v. Cook, 573 F.2d 281
violation of section 10(b) and Rule 10b-5...."); Continental Grain
(Australia) Pty. Ltd. v. Pacific Oilseeds, Inc., 592 F.2d 409, 418
(8th Cir.1979) (same). As we intimated in MCG, 896 F.2d at 174-75,
this is a bit of an overstatement: A close examination of the
Second Circuit's caselaw reveals that the real test is simply
whether material domestic conduct directly caused the complained-of
loss. See, e.g., Psimenos, 722 F.2d at 1046; Cornfeld, 619 F.2d
at 920-21. Because the Zoelsch court correctly stated this
standard, Zoelsch, 824 F.2d at 30-31, we assume that its
speculation as to what the rule "seems to be" is a simple
misreading of the cases that was not intended to work any sort of
implicit change in the substantive law. In any case, the Zoelsch
court explicitly adopted the Second Circuit's test for
jurisdiction, id. at 33, and thus cannot reasonably be read to have
fashioned a new rule.
11
SEC v. Kasser, 548 F.2d 109, 114 (3d Cir.1977); Continental
Grain, 592 F.2d at 420-21; Travis v. Anthes Imperial, Ltd., 473
F.2d 515, 524 (8th Cir.1973); Butte Mining PLC v. Smith, 76 F.3d
287, 290-91 (9th Cir.1996); Grunenthal GmbH v. Hotz, 712 F.2d 421,
424-25 (9th Cir.1983).
12
See Kasser, 548 F.2d at 114 (holding that the test is whether
"at least some activity designed to further a fraudulent scheme
occurs within this country"); Continental Grain, 592 F.2d at 421
(holding that jurisdiction lies where defendants used
instrumentalities of interstate commerce and their "conduct in the
United States was in furtherance of a fraudulent scheme and was
significant with respect to its accomplishment"); Grunenthal, 712
F.2d at 425 (expressly adopting the Continental Grain test).
13
The Seventh Circuit has applied the conduct test to suits
brought under the Commodity Exchange Act without distinguishing
between the competing positions. See Tamari v. Bache & Co.
(Lebanon) S.A.L., 730 F.2d 1103, 1107-08 (7th Cir.1984).
11
(5th Cir.1978), we rejected a jurisdictional challenge to a
conviction stemming from a Ponzi scheme that victimized foreign
investors but involved American securities and a considerable
degree of domestic conduct. Finding the scheme "so far within the
jurisdiction of the American courts as to give us little pause," we
deferred for another day the "puzzling questions posed by [ ]
transactions with only a marginal United States nexus." Id. at
283. Similarly, in MCG, 896 F.2d at 174-75, we merely noted the
existence of the circuit split.
We adopt the Second Circuit's test as the better reasoned of
the competing positions. Federal courts are courts of limited
jurisdiction, and we therefore view the debate among the circuits
against the background that legislation, "unless a contrary intent
appears, is meant to apply only within the territorial jurisdiction
of the United States." Foley Bros. v. Filardo, 336 U.S. 281, 285,
69 S. Ct. 575, 577, 93 L. Ed. 680 (1949). This is not to suggest
that legislation may never be applied to foreign conduct if it does
not explicitly evidence such intent; as every court that has
considered the issue before us has acknowledged, under some
circumstances it can and should be so applied.14 Rather, we mean
only to note that the presumption against extraterritorial
application informs our choice between the Second Circuit's
restrictive test and the more expansive standard applied by the
Third, Eighth, and Ninth Circuits.
14
See, e.g., Leasco, 468 F.2d at 1334; Schoenbaum, 405 F.2d
at 206; see also Tamari v. Bache & Co. (Lebanon) S.A.L., 730 F.2d
1103, 1107 n. 11 (7th Cir.1984).
12
What little guidance we can glean from the securities statutes
indicates that they are designed to protect American investors and
markets, as opposed to the victims of any fraud that somehow
touches the United States. See 15 U.S.C. § 78b; Zoelsch, 824 F.2d
at 31-32. To broaden our jurisdiction beyond the minimum necessary
to achieve these goals seems unwarranted in the absence of an
express legislative command. See Zoelsch, 824 F.2d at 32.
Moreover, as the Zoelsch court pointed out, id. at 32-33, the
results in Kasser and Continental Grain are based more on policy
considerations than on the language of the securities statutes or
the Supreme Court's teachings on extraterritoriality.15 We agree
with the Zoelsch court's view that Kasser and Continental Grain's
policy arguments for expanding federal jurisdiction "may provide
very good reasons why Congress should amend the statute but are
less adequate as reasons why courts should do so." Zoelsch, 824
F.2d at 33.
C.
With the Second Circuit's test in mind, then, we return to
Robinson's contention that the instruction letter sent from U.S.
West's legal department to KB via TeleWest was sufficiently
significant conduct to support subject matter jurisdiction.
Although the district court acknowledged that the instruction
15
See Kasser, 548 F.2d at 116 ("From a policy perspective, and
it should be recognized that this case in a large measure calls for
a policy decision, we believe that there are sound rationales for
asserting jurisdiction.") (footnote omitted); Continental Grain,
592 F.2d at 421 ("We frankly admit that the finding of subject
matter jurisdiction in the present case is largely a policy
decision.").
13
letter caused the valuation of which Robinson complains, it
concluded that "this lone mailing, an event occurring months after
the allegedly fraudulent inducement, cannot justify the heaving of
an entire cause of action, all else of which involves material
conduct occurring in England, across the Atlantic Ocean."
We disagree. As a threshold matter, it is not the case that
all the other conduct material to the case occurred in England,
although certainly most of it did. Robinson's allegation—which at
this stage of the proceedings we must take as true—is that the
entire scheme was directed and controlled from the United States by
TCI and U.S. West. More importantly, the "lone mailing" of the
instruction letter from the United States was one of the key
events—if not the key event—in the alleged scheme to defraud.
The heart of Robinson's claim is that the defendants duped him
into selling his stock by telling him there would be only one
valuation. Regardless of whether it constitutes the totality of
the alleged fraud, it is self-evident that the act of requesting
the second valuation was a substantial act in furtherance of the
scheme. The instruction letter was more than merely preparatory—it
directly triggered the injury of which Robinson now complains.
This is a sufficient basis for subject matter jurisdiction, and we
accordingly reverse the dismissal of the case on this ground.
III.
Robinson also contends that the district court erred in
finding that, in the alternative, his suit should be dismissed for
f.n.c. He has three arguments in this regard: (1) that there is no
14
evidence that an English forum is available; (2) that the district
court improperly conducted the public and private interest tests
for f.n.c.; and (3) that the district court failed to include a
return jurisdiction clause in its judgment of dismissal. The
burden of showing f.n.c. rests with the defendants, and we review
a district court's determination for abuse of discretion.16
We address Robinson's third contention first. Relying on Air
Crash and Baris v. Sulpicio Lines, Inc., 932 F.2d 1540 (5th Cir.),
cert. denied, 502 U.S. 963, 112 S. Ct. 430, 116 L. Ed. 2d 449 (1991),
appeal after remand, 74 F.3d 567 (5th Cir.1996), vacated and
district court judgment aff'd. by an evenly divided court, 101 F.3d
367 (5th Cir.1996) (en banc), cert. denied, --- U.S. ----, 117
S. Ct. 1432, 137 L. Ed. 2d 540, and cert. denied, --- U.S. ----, 117
S. Ct. 1460, 137 L. Ed. 2d 564 (1997), Robinson argues that the
failure to include a return jurisdiction clause in an f.n.c.
dismissal constitutes a per se abuse of discretion. He is correct.
As the en banc court stated in Air Crash,
If the district court decides that the [public and private
interest factors] favor trial in a foreign forum, it must
finally ensure that a plaintiff can reinstate his suit in the
alternative forum without undue inconvenience or prejudice and
that if the defendant obstructs such reinstatement in the
alternative forum that the plaintiff may return to the
American forum.
Air Crash, 821 F.2d at 1166; see also Baris, 932 F.2d at 1551-52.
The return jurisdiction clause is part of a larger set of
16
In re Air Crash Disaster Near New Orleans, Louisiana, 821
F.2d 1147, 1166 (5th Cir.1987) (en banc), vacated on other grounds
sub nom. Pan Am. World Airways, Inc. v. Lopez, 490 U.S. 1032, 109
S. Ct. 1928, 104 L. Ed. 2d 400 (1989), opinion reinstated on other
grounds, 883 F.2d 17 (5th Cir.1989) (en banc).
15
measures needed "to ensure that defendants will not attempt to
evade the jurisdiction of the foreign courts," which may also
include "agreements between the parties to litigate in another
forum, to submit to service of process in that jurisdiction, to
waive the assertion of any limitations defenses, to agree to
discovery, and to agree to the enforceability of the foreign
judgment." Baris, 932 F.2d at 1551. Although neither Air Crash
nor Baris provides step-by-step guidance as to what combination of
these measures must be implemented, Baris unmistakably indicates
that the failure to include a return jurisdiction clause is a fatal
error. Id. At a minimum, then, the district court's ruling on
f.n.c. must be vacated and remanded for the implementation of a
return jurisdiction clause.
We address Robinson's remaining contentions in the interest
of judicial economy. Drawing on our cases that require the foreign
forum to be both available and adequate, e.g., id. at 1549, his
first argument is that the defendants have failed to make the
requisite showing that England is an available forum. That is, he
argues, there is no evidence to indicate that an English forum is
available, as the defendants failed to present evidence that the
case and the parties can come within the jurisdiction of an English
court. See Air Crash, 821 F.2d at 1165. In conjunction with this,
he asserts that the fact that TCI and U.S. West have attempted to
escape personal jurisdiction in Texas by arguing that they do not
do business here indicates that they will likely make similar
arguments in England.
16
The defendants, however, point to the uncontroverted affidavit
of Michael John Brindle, Q.C., an English barrister, regarding the
English courts' jurisdiction over the parties and claims in this
case. According to Mr. Brindle, when one party to a fraudulent
conspiracy is English, any alleged co-conspirators outside the
court's ordinary jurisdiction may be joined as "necessary or proper
parties" under Order 11 of the Rules of the Supreme Court of
England and Wales. We do not think the district court abused its
discretion in relying upon this testimony to find that an English
forum is available. As we stated in Baris, 932 F.2d at 1551, it is
within the court's discretion to determine what measures it must
implement so as "to ensure that defendants will not attempt to
evade the jurisdiction of the foreign courts." So long as this
general requirement is met, we will not take issue with the manner
in which the district court has chosen to comply with it.
Robinson also argues that there is insufficient evidence in
the record to support the district court's findings on the private
and public interest tests. With some deference to the plaintiff's
choice of forum, the private interest factors that the court must
consider include
the relative ease of access to sources of proof; availability
of compulsory process for attendance of unwilling, and the
costs of obtaining attendance of willing, witnesses;
probability of view of premises, if view would be appropriate
to the action; and all other practical problems that make
trial of a case easy, expeditious and inexpensive. There may
also be questions as to the enforcibility [sic] of a judgment
if one is obtained.
Air Crash, 821 F.2d at 1162 (quoting Gulf Oil Corp. v. Gilbert, 330
U.S. 501, 508, 67 S. Ct. 839, 842, 91 L. Ed. 1055 (1947)). When the
17
private interest factors do not weigh in favor of dismissal, the
court must also consider "the administrative difficulties flowing
from court congestion; the local interest in having localized
controversies resolved at home; ... the avoidance of unnecessary
problems in conflicts of law, or in application of foreign law;
and the unfairness of burdening citizens in an unrelated forum with
jury duty." Id. at 1162-63 (citing Gulf Oil, 330 U.S. at 508-09,
67 S.Ct. at 842-43).
Nothing in the record persuades us that the district court
abused its discretion in this regard. Robinson and Davidson are
English citizens who reside in England. TeleWest is an English
corporation, and Kleinwort Benson an English merchant bank. With
the exception of TCI, U.S. West, and the allegation that they
controlled and directed English entities from the United States,
everything in this case is grounded in England. Certainly nothing
suggests that the cause should be tried in Texas (as opposed to
Colorado, the place where TCI and U.S. West are alleged to have
orchestrated the fraud).
Robinson protests that many of the potential witnesses are
located in the United States and that certain types of discovery
available to him here will not be available in England. Given the
enormous scope of discovery permitted under American law, we have
little doubt that he is correct about this. The argument, however,
is in essence an attack on the quantum of the defendants' proof in
the district court rather than on its substance, a basis on which
we are highly reluctant to find an abuse of discretion. We
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therefore conclude that the district court did not err in deciding
that this case belongs in England, and accordingly we remand with
instruction to reinstate the dismissal following the inclusion of
a return jurisdiction clause.
For the foregoing reasons, we REVERSE the dismissal for lack
of subject matter jurisdiction, VACATE the determination as to
f.n.c., and REMAND with instruction to dismiss following the
addition of a return jurisdiction clause to the judgment.
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