Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Shagang Shipping Company Ltd. v. HNA Group Co., Ltd.

United States District Court, W.D. Washington, Seattle

March 28, 2018

SHAGANG SHIPPING COMPANY LIMITED (IN LIQUIDATION), Plaintiff, HNA GROUP CO., LTD., HNA HOLDING GROUP CO. LIMITED f/k/a HNA INTERNATIONAL INVESTMENT HOLDINGS LIMITED, HNA PLATEAU GOLF LLC, HNA WASHINGTON NATIONAL GOLF LLC, HNA NEWCASTLE GOLF LLC, HNA INDIAN SUMMER GOLF LLC, HNA TROPHY LAKE GOLF, LLC, HNA REDMOND RIDGE LLC HNA HARBOUR POINTE LLC and ABC GOLF, LLC, Defendants.

         IN ADMIRALTY

          ORDER

          HONORABLE RICHARD A. JONES UNITED STATES DISTRICT JUDGE

         This matter comes before the Court on Defendants' Motion To Vacate Process of Maritime Attachment and Garnishment and Dismiss Complaint. Dkt. # 32. The parties presented sufficient arguments by way of thorough briefing[1] and the balance of the record for the Court to render a decision based on Supplemental Admiralty Rule E(4)(f). The parties were permitted to file extensive briefing and evidence on which the Court placed no limitation, and therefore the Court finds a hearing unnecessary on this matter in light of the briefing and balance of the record.

         I. BACKGROUND

         Plaintiff entered into a Charter Agreement with Grand China, to which HNA Group Co. Ltd. (“Group”) signed as a guarantor. Dkt. # 1 (Complaint) at ¶ 16. Grand China breached the Agreement and Group refused to fulfill its obligations as the guarantor. Id. at ¶¶ 18, 19. The parties litigated in London in the English Court, which entered judgment against Group for the sum of $68, 597, 049.59, plus interests and costs (“English Judgement”). Id. at ¶ 21.

         To collect on the English Judgment, Plaintiff successfully obtained a writ of attachment pursuant to the Supplemental Rules for Admiralty and Maritime Claims and Asset Forfeiture Actions of the Federal Rules of Civil Procedure. Dkt. ## 2, 6. The Court issued process of attachment and writ of garnishment against eight golf courses located in Washington (“US golf courses”). Dkt. # 6.

         In seeking attachment of the U.S. golf courses, Plaintiff needed to prove through a verified complaint that it established a reasonable probability that it would prevail on its alter ego claim of liability against Defendants. Id. Eight limited liability companies (“LLC Defendants”) own the U.S. golf courses. Dkt. # 1 (Complaint) at ¶¶ 45, 46. These LLC Defendants are owned by HNA Holding Group Co. Limited (“Holding”). Id. at ¶ 45. In turn, Holding is owned in part by Group and in part by public shareholders. Specifically, Group, through a series of subsidiaries, holds approximately 67 percent of Holding's traded shares while about 900 public shareholders own the remaining 33 percent of Holding's traded shares. Dkt. # 34 at 809.

         Plaintiff alleges that Group, Holding, and the LLC Defendants abused the corporate form through overlapping officers and suspect infusions of capital to avoid creditors. Defendants deny this, offering a panoply of public records into evidence. Defendants are now before the Court seeking vacatur of the attachment.

         II. LEGAL STANDARD

         Rule B maritime attachments serve the dual purpose of obtaining jurisdiction over an absent defendant and securing collateral for a potential judgment in plaintiff's favor. Aqua Stoli Shipping Ltd. v. Gardner Smith Pty. Ltd., 460 F.3d 434, 437 (2d Cir. 2006), overruled on other grounds by Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58, 61 (2d Cir. 2009) (mini en banc). The elements for a Rule B writ of maritime attachment are: “(1) plaintiff has a valid prima facie admiralty claim against the defendant; (2) defendant cannot be found within the district; (3) property of the defendant can be found within the district; and (4) there is no statutory or maritime law bar to the attachment.” Equatorial Marine Fuel Mgmt. Servs. Pte Ltd. v. MISC Berhad, 591 F.3d 1208, 1210 (9th Cir. 2010) (citing Aqua Stoli Shipping, 460 F.3d at 445); Fed. R. Civ. P., Supp. R. B

         Rule E(4)(f) allows any person whose property has been attached pursuant to Rule B an opportunity to appear before the Court to contest the attachment. To sustain an attachment, the burden is on Plaintiff to show that it has fulfilled the “filing and service requirements of Rules B and E.” Aqua Stoli Shipping Ltd., 460 F.3d at 445 (footnote omitted); see also Equatorial Marine Fuel Mgmt. Servs., 591 F.3d at 1210 (“At a Rule E hearing, defendant may argue that the attachment should be vacated because plaintiff failed to meet one of the four conditions for attachment.”).

         If a plaintiff fails to demonstrate that it has met the requirements of Rules B and E, the Court must vacate the attachment. Id. at 445. Maritime plaintiffs, however, are not required to prove their case at this stage. See Ronda Ship Mgmt. Inc. v. Doha Asian Games Organising Comm., 511 F.Supp.2d 399, 404 (S.D.N.Y. 2007) (“The prima facie standard in the maritime attachment context is a pleading requirement, not an evidentiary standard, and differs from the use of that phrase in other contexts.”); Wajilam Exps. (Singapore) Pte, Ltd. v. ATL Shipping Ltd., 475 F.Supp.2d 275, 279 (S.D.N.Y. 2006) (holding that where attachment is based on a fraud theory of veil piercing, plaintiff should not be required to allege fraud with particularity before discovery) (citing Japan Line, Ltd. v. Willco Oil Ltd., 424 F.Supp. 1092, 1094 (D. Conn. 1976)); Sea-Terminals, Inc. v. Indep. Container Line, Ltd., No. 89-412-JRR, 1989 WL 222634, at *2 (D. Del. Aug. 16, 1989) (holding that whether the defendant “is a totally separate and unrelated company” from the company directly liable to plaintiff should not be decided “until the facts are fully fleshed out after discovery”).

         If the plaintiff carries its burden of showing that an attachment satisfies the requirements, the Court may still vacate the attachment if the defendant can show that “1) the defendant is present in a convenient adjacent jurisdiction; 2) the defendant is present in the district where the plaintiff is located; or 3) the plaintiff has already obtained sufficient security for a judgment.” See Proshipline Inc. v. Aspen Infrastructures Ltd., 533 F.Supp.2d 422, 426 (S.D.N.Y. 2008) (citing Aqua Stoli Shipping Ltd., 460 F.3d at 436).

         III. ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.