Unitednet Ltd. v. Tata Communications America, Inc.
No. 23-2057. 8/19/2024. D.N.M. Judge Moritz. Forum non Conveniens—Choice-of-Law Determination—Private- and Public- Interest Factors.
August 19, 2024
In 2013, Tata Sons Private, Ltd., an Indian investment holding company, decided to sell its fiber-optic telecommunications network (network) that runs from the United Kingdom to the Netherlands. In 2014, Lucero, a New Mexico resident, agreed to purchase the network through his company LatinGroup, LLC, which entered into a preliminary agreement to purchase the network from three foreign Tata companies—Tata Communications (UK) Ltd., Tata Communications (Netherlands) B.V., and Tata Communications (Bermuda) Ltd. However, Lucero subsequently decided to purchase the network through a separate corporate entity, so he formed Unitednet, Ltd. in the United Kingdom and had LatinGroup assign its purchase rights to Unitednet. Lucero named Russell, a United Kingdom resident, as Unitednet’s director and promised him an equity stake in the company as compensation. In 2016, Unitednet entered into an agreement to purchase the network. But Lucero then allegedly conspired with Tata Communications America, Inc., based in Virginia; Tata Communications India, Inc., based in India; and Tata Sons Private, Ltd. (Tata defendants) to sabotage the deal so he could purchase the network through LatinGroup. The Unitednet deal fell apart, and Unitednet and Russell filed this action in New Mexico asserting claims for tortious interference with contract, civil conspiracy, and quantum meruit against Lucero, LatinGroup, and the Tata defendants. They also alleged breach of fiduciary duty against Lucero, and aiding and abetting breach of fiduciary duty against LatinGroup and the Tata defendants. Lucero and LatinGroup moved to dismiss under the doctrine of forum non conveniens, as did Tata Communications America, Inc. The district court dismissed the case based on forum non conveniens, determining that the United Kingdom was a more appropriate forum for the litigation.
On appeal, Unitednet and Russell argued that the district court erred in dismissing the action for forum non conveniens. They challenged the district court’s choice-of-law determination that foreign law applies and its finding that the private- and public-interest factors favor dismissal. A district court evaluates a motion to dismiss for forum non conveniens by analyzing whether (1) an adequate alternative forum exists in which the defendant is amenable to process and (2) foreign law applies. If both conditions are met, the court then weighs a list of private and public interests to determine whether to dismiss for forum non conveniens. Typically, there is a strong presumption in favor of a domestic plaintiff’s choice of forum, but this assumption deserves less deference when, as here, the plaintiff is foreign. To determine whether foreign or domestic law governs a case, a federal court sitting in diversity applies the choice-of-law rules of the forum state. The parties agreed that all of plaintiffs’ claims except that for quantum meruit sound in tort. In tort actions, New Mexico directs courts to apply the substantive law of the place where the wrong occurred, and the place of the wrong is “where the last event necessary to make an actor liable for an alleged tort takes place.” Here, the place of the wrong was overseas, where the Tata sellers terminated the agreement, because the agreement’s termination was the last event necessary to make defendants liable for the alleged torts. Accordingly, the district court did not err in concluding that foreign law applies to plaintiffs’ tort claims. Further, the court did not err in finding that the private interest factors favor dismissal because notwithstanding the availability of videoconferencing, the bulk of the parties and witnesses are located abroad. And the district court did not err in finding that the public-interest factors favor dismissal because aside from Lucero, who resides in New Mexico, and LatinGroup, which maintains its principal place of business there, the complaint does not allege any ties to the state or otherwise raise a local dispute; and the dispute has strong ties to the United Kingdom. Therefore, the district court acted within its discretion in dismissing the case for forum non conveniens.
The dismissal was affirmed.