United States District Court, E.D. Virginia, Norfolk Division
For Dry Handy Investments Ltd., Plaintiff: Philip Norton Davey, LEAD ATTORNEY, Christopher N. Harrell, Patrick Michael Brogan, Davey & Brogan PC, Norfolk, VA; Kevin John Lennon, Patrick Francis Lennon, PRO HAC VICE, Lennon Murphy Caufield Phillips LLC, Southport, CT.
For Limari Shipping Ltd., Defendant: Dustin Mitchell Paul, Mark T. Coberly, Vandeventer Black LLP, Norfolk, VA.
OPINION AND ORDER
Mark S. Davis, United States District Judge.
This matter is before the Court on a motion by Limari Shipping, Ltd. (" Claimant" ) to quash an ex parte order issued by this Court on November 27, 2013. For the reasons set forth below, the Court GRANTS Claimant's motion. Plaintiff's request for attorneys' fees and costs is TAKEN UNDER ADVISEMENT.
I. FACTUAL AND PROCEDURAL BACKGROUND
On November 27, 2013, Plaintiff Dry Handy Investments, Ltd. (" Plaintiff" ) filed a Verified Complaint alleging breach by Defendant Corvina Shipping Co. S.A. (" Corvina" ) of a joint venture agreement (" JVA" ) between Plaintiff and Corvina. ECF No. 1. The Verified Complaint also named Compania Sud Americana de Vapores S.A. (" CSAV" ) as a Defendant, claiming that " CSAV totally dominated and controlled Corvina as an alter ego, subservient entity and/or instrumentality." Id. at 7. Plaintiff's Verified Complaint described the relationship between Corvina
and CSAV, alleging, inter alia, that " CSAV was the 100% owner and corporate parent of Corvina," that Corvina " actually carr[ied] out the CSAV's business and not its own," and that Corvina and CSAV shared " officer[s]," " director[s]," " employees," and " email addresses." Id. at ¶ ¶ 44-53. The Verified Complaint asserted that Corvina had " no actual offices," " phone or fax numbers," " no internet website," and that Corvina " failed to maintain proper corporate books and records." Id. at ¶ ¶ 54-56, 65. Plaintiff contended that, because CSAV and Corvina had " participated in cross-collateralization," " failed to maintain corporate formalities," and " did not operate at arms-length," " the corporate form of Corvina must be disregarded as a matter of law and equity and [CSAV and Corvina] are therefore liable jointly and severally for the Plaintiff's claims herein." Id. at ¶ ¶ 69, 72.
Along with its Verified Complaint, Plaintiff filed a motion pursuant to Supplemental Admiralty Rule B for attachment of the M/V LIMARI (" the ship" ), which was expected to arrive in the Eastern District of Virginia on November 30, 2013. ECF No. 3. Plaintiff requested attachment of the ship " in order to secure [Plaintiff's] maritime claims against [Defendants] . . . based on Corvina's breach of its obligations under the parties' Joint Venture Agreement (" JVA" )." ECF No. 4 at 1. As required by Rule B, Plaintiff asserted that its " cause of action is maritime," that " Defendants cannot be 'found' in the District," and that " Defendants have, or will soon have, property in the District." Id. at 5-8. Although the ship, according to Plaintiff, was " legally, equitably and beneficially owned by Defendant CSAV," id. at 8, Plaintiff argued that attachment of the ship was proper because, " where issuance of process pursuant to Rule B is allowed as to Defendant Corvina, it too should be allowed as against Corvina's alter ego, CSAV," id. at 9.
As is the Court's custom upon the filing of such an action, the Court met with Plaintiff's counsel in chambers. The Court conducted an on-the-record review of the Verified Complaint and accompanying documents filed earlier that day. (Transcript pending). The Court, after considering Plaintiff's motion and argument, granted the motion and issued an Ex Parte Order for Process of Maritime Attachment and Garnishment. ECF No. 8. The ship was arrested on November 30, 2013. On December 2, 2013, Claimant filed a Motion to Quash the Order of Attachment and Garnishment and requested an expedited hearing on the matter, pursuant to Supplemental Admiralty Rule E(4)(f). ECF No. 14. Claimant argued that the JVA was not a maritime contract within the Court's admiralty jurisdiction and, in any event, the ship was owned by Claimant, " a third party," not Corvina or CSAV. ECF No. 15 at 11. Claimant also sought an award of attorneys' fees and costs " for defending the wrongful attachment" of the ship. ECF No. 14 at 1.
The Court held a hearing on Claimant's motion on December 3, 2013, at which time the parties explained that the ship and her cargo were at anchorage and ready to proceed to her next port. After hearing argument, the Court ordered expedited briefing of the issues. Plaintiff filed a brief in opposition to Claimant's motion, as well as numerous exhibits, on December 4, 2013. ECF Nos. 23-25. ...