| OneBeacon Am. Ins. Co. v Newmont Min. Corp. |
| 2011 NY Slip Op 01942 [82 AD3d 554] |
| March 17, 2011 |
| Appellate Division, First Department |
| OneBeacon America Insurance Company et al.,Plaintiffs, v Newmont Mining Corporation et al., Respondents, and American HomeAssurance Company et al., Appellants, et al., Defendants. OneBeacon America InsuranceCompany et al., Appellants-Respondents, et al., Plaintiff, v Newmont Mining Corporation et al.,Defendants, and Allstate Insurance Company et al., Respondents, and Certain Underwriters atLloyd's, London, et al., Respondents-Respondents. |
—[*1] Christie Pabarue Mortensen & Young, Philadelphia, Pennsylvania (Ralph J. Luongo of thePennsylvania bar, admitted pro hac vice, of counsel), for appellants-respondents. [*2]Clausen Miller P.C., Chicago, Illinois (MichaelBaughman of the Illinois bar, admitted pro hac vice of counsel), for Insurance Company of NorthAmerica and Century Indemnity Company, respondents-appellants. Rivkin Radler LLP, Uniondale (Frank A. Valverde of counsel), for Allstate InsuranceCompany and Fireman's Fund Insurance Company, respondents. Tofel & Partners, LLP, New York (Robert L. Tofel and Mark A. Lopeman of counsel), forNewmont Mining Corporation and Dawn Mining Company, respondents.
Order, Supreme Court, New York County (Charles E. Ramos, J.), entered May 15, 2009,which, to the extent appealed from and not hereby rendered academic, granted the motion ofdefendant Dawn Mining Company to dismiss the complaint as against it for lack of personaljurisdiction, unanimously affirmed, without costs. Order, same court and Justice, entered October23, 2009, which denied defendant Newmont Mining Corporation's motion to renew its motion todismiss the action on grounds of forum non conveniens, unanimously reversed, on the law, themotion for renewal granted, and upon renewal, the motion to dismiss on grounds of forum nonconveniens granted, without costs. Appeals by OneBeacon America Insurance Company andStonewall Insurance Company and Continental Casualty Company and the ContinentalAssurance Company from the orders, unanimously withdrawn pursuant to the stipulations of theparties.
With regard to the first order under review, assuming arguendo that New York has generaljurisdiction over Newmont, it does not have jurisdiction over Dawn as a mere department ofNewmont. As stated in the case on which plaintiffs and the insurer defendants primarily rely,"New York courts regard one factor as essential to the assertion of jurisdiction over a foreignrelated corporation . . . Th[at] essential factor is common ownership. . . [N]early identical ownership interests must exist before one corporation can beconsidered a department of another corporation for jurisdictional purposes"(Volkswagenwerk AG. v Beech Aircraft Corp., 751 F2d 117, 120 [2d Cir 1984]). It isundisputed that Newmont owns only 51% of Dawn and that the other 49% is owned by acorporation independent of Newmont. This does not constitute common ownership (see e.g.Antares Aircraft L.P. v Total C.F.P., 1991 WL 19997, *4, 1991 US Dist LEXIS 1511, *10[SD NY 1991], affd 948 F2d 1275 [2d Cir 1991] [51.8% not enough]; Levy vPlastocks, Inc., 744 F Supp 570, 572 [SD NY 1990] [50% not enough]).
New York does not have long-arm jurisdiction over Dawn pursuant to CPLR 302 (a) (1) onthe theory that Newmont was acting as Dawn's agent when it purchased the insurance policies atissue (see Insurance Co. of N. Am. vEMCOR Group, Inc., 9 AD3d 319 [2004]). There is no evidence that Dawn exercisedcontrol over Newmont with respect to Newmont's purchase of insurance (see Kreutter vMcFadden Oil Corp., 71 NY2d 460, 467 [1988]).
The motion court properly exercised its discretion in denying the insurers' request forjurisdictional discovery. As the court noted, the relationship between Newmont and Dawn hasbeen thoroughly explored in a trial in another case. Furthermore, no amount of jurisdictionaldiscovery will change the fact that Newmont owns only 51% of Dawn or that Newmontcontrolled Dawn, and not the other way around (see generally Putter v North Shore Univ. Hosp., 7 NY3d 548, 554[2006]).[*3]
With regard to the second order under review, Newmontwas entitled to renewal of its motion to dismiss on grounds of forum non conveniens. In supportof renewal, Newmont presented the new fact that the federal court presiding over thesubstantially parallel action in the State of Washington had determined not to dismiss or stay thataction in favor of this one. Upon consideration of the pendency of the Washington action and allother relevant circumstances, we find that the motion court improvidently exercised its discretionin retaining jurisdiction, since Newmont established that New York is an inconvenient forum(see e.g. Anagnostou v Stifel, 204 AD2d 61 [1994]).
The subject matter of both this action and the Washington action—insurance coveragefor environmental liability relating to a uranium mine (the Midnite Mine) in the State ofWashington—has no substantial connection to New York. Of the 11 insurers seeking tolitigate in New York, only three excess insurers, neither of which is a plaintiff, have theirprincipal places of business in New York and only one is a New York corporation. Newmont, theinsured, is a Delaware corporation, headquartered in Colorado, which has no offices in NewYork and has had no presence in New York since 1989. Dawn, the Newmont subsidiary thatoperated the Midnite Mine, is not even subject to jurisdiction in New York, as discussed above;hence, all interested parties cannot be joined in this action. It is undisputed that in prior coveragelitigation it was held that Colorado law applies to virtually all of the policies at issue. Further, theunderlying CERCLA action is being litigated in Washington State federal court, before the samejudge presiding over the parallel coverage action.
The Washington federal court is a superior forum for resolution of this coverage disputebecause all necessary parties are before that court; by contrast, Dawn, as noted, cannot becompelled to litigate in New York. Accordingly, our responsibility to promote judicial efficiencyand to discourage duplicative and piecemeal litigation warrants our deference to the coverageaction in Washington.
The superiority of the Washington forum is undiminished by the purported coverage disputeshaving nothing to do with the Midnite Mine raised by plaintiffs and by one defendant, InsuranceCompany of North America (INA), in a cross claim. The claims for declaratory relief based onthese "disputes," relating to mining activities at three other mines (in California, Arizona andPeru), have no substantial connection to New York, and reduce to little more than notices sent byNewmont's broker, with perfunctory responses by some of the insurers, which then sleptlanguidly for some 10 years before being roused by plaintiffs and INA. Even assuming thesealleged disputes are justiciable, they are plainly unrelated makeweights that lend no credence tothe notion that there is more to this action than a coverage dispute concerning a mine inWashington. Moreover, the insurers raising these issues have not given us any reason to concludethey could not raise their claims in their responsive pleadings in the Washington action.
In view of the foregoing, Newmont's appeal of the first order under review is renderedacademic. Concur—Friedman, J.P., Catterson, McGuire, Acosta and Renwick, JJ.