text:
An English buyer, plaintiff, and a German seller, defendant, entered into a contract for the supply of iron-molybdenum from China, CIF Rotterdam, delivery in October 1994. The goods were never delivered to the buyer, as the seller did not itself receive delivery of the goods from its own Chinese supplier. After expiry of an additional period of time for delivery, the buyer concluded a substitute transaction with a third party and sued the seller for the difference between the price paid and the price under the contract.
The court held that the buyer was entitled to damages under article 75 of the CISG. It found that the contract had been avoided under article 49(1) of the CISG, both under paragraphs (a) and (b). As to paragraph (a), it said that, although delay in time is not generally considered as a fundamental breach of contract, it can constitute a fundamental breach if delivery within a specific time is of special interest to the buyer, which must be foreseeable at the time of the conclusion of the contract (article 25 CISG). The Incoterm "CIF" by definition determines the contract to be a transaction for delivery by a fixed date. As to paragraph (b), it found that the buyer had fixed an additional period of time for delivery (article 47(1) CISG) within which the seller had failed to deliver.
The court held that an explicit declaration of avoidance was unnecessary once the seller refused to perform its delivery obligation and that to insist on such a declaration would be contrary to the principle of good faith (article 7(1) CISG). Such a declaration is dispensable as long as the avoidance of the contract is possible in principle and it is certain that the seller will not perform its obligations at the time the substitute purchase is made. The court held that a substitute purchase within two weeks after the failure of performance was made in reasonable time.
The court held that the seller was not exempt from liability, neither under a force majeure clause of the contract, nor under article 79(1) of the Convention. The seller bears the risk of itself receiving delivery of the goods from its own supplier. Only if goods of an equal or similar quality were no longer available on the market would the seller be exempted from liability. Furthermore, the court held that it was incumbent upon the seller to bear the risk of increasing market prices at the time of the substitute transaction. Although the market price had risen to an amount triple the price that had been agreed at the time of the conclusion of the original contract, this did not amount to a sacrificial sale price, as the transaction was said to be highly speculative.
"In a dispute between a British seller and a German buyer over the non-delivery of iron molybdenum ('CIF Rotterdam'), the Hamburg Court of Appeals held that in CIF contracts timely delivery is per definitionem an essential term of the contract." Koch, Pace Review of the Convention on Contracts for the International Sale of Goods (1998) 236.
"The Hamburg Court of Appeal stated as follows: '[translation] The untimely delivery constitutes a fundamental breach according to art. 49(1)(a), 25 CISG. Untimely delivery, it is true, does not always constitute a fundamental breach. This general rule under the Convention, however, does not apply to cases where, at the time of the formation of the contract, it was obvious to the seller that the buyer had a special interest in punctual delivery. . . . In the pertinent case such special interest of the buyer follows from the reference to the Incoterm "CIF" in the contract'". Id. at n.203.
The Buyer requests damages for the non-fulfilment of a sales contract.
"The Seller shall not be held responsibility if due to force majeure, Seller fails to make delivery within the time stipulated in this sales contract or cannot deliver the goods. However, the Seller shall inform the Buyer immediately by telex or fax message."
Upon the Seller's explicit request via fax of 20 October 1994, the Buyer confirmed that these general conditions should become a part of the contract by the note on that fax: "OK. We accept", dated the same day.
The Seller informed the Buyer by fax on 20 October 1994, that its Chinese supplier now demanded US $10.50/kg molybdenum CFR Rotterdam and asked the Buyer for a corresponding adjustment of the purchase price. The Buyer refused by fax dated 24 October 1994. The Seller then informed the Buyer by fax on 31 October 1994, that it could only deliver iron-molybdenum of lower quality, with a concentration of molybdenum of 60%, at a price of US $10.20/kg molybdenum CIF Rotterdam, shipment in November / early December from "China port" to Rotterdam. The Buyer reacted to this message by fax on the same day, in which it accepted the lower concentration of molybdenum, but insisted on the price originally agreed upon and a shipment date before or on 15 November 1994. The Buyer announced it would make a cover purchase and hold the Seller responsible for all additional costs in case the Seller did not comply with these requirements.
After the Seller had declared that it could not comply with the time limit, the Buyer, by fax dated 3 November 1994, reluctantly granted another time limit for shipment: 30 November 1994. The fax again contained the threat of a cover purchase in case of non-compliance with the time limit. The Buyer declared that compliance with the time limit was very important, because it had to fulfil obligations from a resale contract.
Upon the Buyer's demand, the Seller declared on 15 November, that it would do its best to fulfil the contract in November 1994. On 2 December 1994, the Seller then informed the Buyer by fax, that the 20-foot container with 19.20 tons of iron-molybdenum had had been shipped from Tianjin to Rotterdam at the end of November. The parties agreed upon a price of 24 USD/kg for the 1.2 tons which were not owed under the original contract.
On 13 December 1994, the Seller informed the Buyer by fax that it had not been provided with iron-molybdenum by its supplier and asked for some time to fulfil the contract. The Buyer informed the Seller by fax on the same day that it needed the material. The contract would have to be fulfilled, otherwise it [the Buyer] would be forced to make a cover purchase at the current market price of US $31 /kg and hold the Seller responsible for additional costs. The Buyer did, however, also propose a compensation payment by the Seller to deal with the matter. By fax on 14 December 1994, the Buyer informed that it still tried to fulfil the contract, but needed time for negotiations for damages with its supplier. As an alternative, the Seller offered to pay a compensation in the amount of US $10,088. The Buyer declined this offer of compensation and declared that it would hold the Seller responsible for contract fulfilment as well as for damages. Another offer of compensation in the amount of US $15,000 on 29 December 1994 was declined by the Buyer, the Buyer stating that its loss, calculated on the basis of the market price, was US $230,000.
According to Exhibit K 19. the Buyer concluded a contract for about 17-20 tons of Chinese iron-molybdenum, CIF Rotterdam concentration of molybdenum: 60%, with the China-N.N-Metals Imp. & Export Corp. (In the following: China-N). The contract stipulated January/February 1995 as time of delivery. The price for the molybdenum was US $30 /kg.
In a fax dated 17 January 1995, the Seller offered iron-molybdenum, concentration of molybdenum 65.19% at a price of US $29.5/kg. The Buyer declined the offer by fax on the same day, referring to a telephone call in which it purportedly had informed the Seller that it had made a cover purchase. The Buyer again called upon the Buyer to make an offer for compensation in order to resolve the dispute. On January 18, 1995, the Seller send a fax offering a compensation of US $17,000, payable in three instalments. The Buyer declined this offer.
The Buyer has submitted the invoice from China-N as Exhibit K 20. The amount of the invoice is US $340,880.06. The quantity delivered was 17.942 kg of iron-molybdenum with a concentration of molybdenum of 63.33%. This leads to a result of 11,362.668 kg of molybdenum which, at a price of US $30/kg, amounts to US $340,880.06.
The Buyer is pursuing an action for arrest against the Seller in Rotterdam. This action had already been pending before the memorandum to begin the present legal dispute was filed with the District Court (Landgericht) of Hamburg.
The Buyer has brought an action for damages in the amount of the difference between the price agreed upon in the contract and the price it had to pay for the iron molybdenum it bought from China-N on 11 January.
- The Buyer has argued that it would have been obliged to pay a purchase price of US $122,040, if the Seller had delivered as contracted.
- The Buyer has calculated the price as follows: 18.000 kg x 60 % concentration of molybdenum = 10,800 kg x US $9.7/kg = US $104,760 and 1,200 kg x 60% concentration of molybdenum = 720 kg x US $24 = 17,280. This leads to the total amount of US $122,040.
- The difference to the US $340,880.06 paid to China-N leads to the amount demanded: US $218,840.06. A translation on the basis of the dollar-rate of the date of the cover purchase, 11 January 1995: 1.5264 DM/US $ leads to the amount of 334,037.46 DM.
This is the amount of the claim brought. The Buyer argues that the "cover purchase" was necessary in order to fulfil obligations from resale contracts that it had planned to fulfil by delivery the material it would have received from the Seller. Buyer further argues that it had financed the purchase price by a bank credit and had already paid US $5,998 interest for that bank credit.
The Buyer has asked the Court to order the Seller to pay 334,037.46 DM plus 9,155.34 DM interest, in the alternative US $218,840.06 plus US $5,998 interest. The Seller has asked the Court to dismiss the action.
The Seller has argued that the District Court of Hamburg had to declare itself incompetent with respect to the action for arrest in Rotterdam or at least suspend the proceeding until the proceedings before the Dutch courts had ended with a legally binding decision. It further argues that the non-delivery in breach of the contract by its supplier had been an unpredictable event that led to an exemption under Art. 79 CISG. It also argues that the Buyer had violated its duty to mitigate damages by declining the offers for compensation of 14 December 1994 and 29 December 1994. Those offers had represented the difference between the contract price and the market price at those dates. The Seller also contests that the Buyer had had obligations to third parties with respect to the material owed under the contract and that it had fulfilled those obligations with the material acquired by the cover purchase.
By its judgment of 2 October 1995 the District Court (Landgericht) of Hamburg has ordered the Seller to pay US $218,840.06 plus 5% interest since 8 June 1995 and rejected the claim for further interest. The District Court has given the following reasons for its decision: The action for arrest in Rotterdam did not hinder the admissibility of the action, as the action for Arrest was not an action in the sense of Arts. 21, 22 of the Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters (in the following: Brussels Convention). The court further stated that the Buyer was entitled to damages in the amount of the difference between the purchase price and the contract price under Art. 75 CISG, because the Seller had not complied with its obligation to deliver under the contract of 12 October 1994. The Buyer had therefore been entitled to avoid the contract under Art. 49(a) and (b) CISG. Art. 79 was irrelevant as well as No. 2 of the contract conditions, since the non-delivery did not result from an impediment beyond the Seller's control. A claim for interest had, however, not been sufficiently proven, therefore only 5% interest could be awarded for the time the legal dispute had been pending.
The Seller has appealed the decision, which was served upon it on 11 October 1995 on Monday, 13 November 1995 by submitting a memorandum. The Seller has given reasons for its appeal by a memorandum of Monday, 15 January 1995 after the period of time for giving reasons had been extended by one month for the Seller.
The Seller continues to argue that the action was inadmissible with respect to the pending action for arrest at the court in Rotterdam. It also argues that the claim was not justified. The Seller argues that it was exempted from liability according to its contract conditions and Art. 79 CISG. It purports to have concluded a contract for the goods to be delivered to the Buyer already on 26 August 1994 with its supplier: J Provincial Metals and Minerals Import & Export Corporation (hereafter: J Provincial Metals). The Seller states that it had executed several contracts with this company before and therefore could not have anticipated that J Provincial Metals would, despite reassuring several times that delivery would be made, eventually refuse to deliver the goods because of difficulties in production and shortages in supply.
The Seller also contests obligations of the Buyer to resell the material as well as the usage of the material acquired in the cover purchase to fulfil such obligations. Furthermore, the Seller contends that the Buyer had violated its duty to mitigate damages. Such a violation resulted from the fact alone, that the Buyer had not had any obligations to resell. It also resulted from the date of the cover purchase. The price for iron-molybdenum had risen by an average of US $17.9/kg molybdenum from 13 December 1994 to 11 January 1995.
The Seller has asked the Court to change the decision appealed and reject the claim, in the alternative to suspend the proceeding.
The Buyer has asked the Court to reject the Seller's appeal. The Buyer contends that the Seller could neither rely on a limitation of liability under the contract nor under Art. 79 CISG. The true reason for non-delivery was that the Seller had not been able to acquire the goods at its desired price on the Chinese market and had therefore thought that its profit margin was too low. The market price for iron-molybdenum had, already on 16 December 1994 been at around US $30, and had, between 16 December 1994 and 11 January 1995, only varied slightly, around US $1 - $2 from the US $30 level.
By decision of 12 July 1996, the Court of Appeals had rejected the appeal by the Seller as inadmissible by decision of. Upon the immediate complaint by the Seller, the Federal Supreme Court has, by its decision of 16 November 1996, annulled the decision of 12 July 1996.
In addition to the facts stated here, reference is made to the memoranda which have been added to the record.
The claim is admissible. The objection of lis alibi pendens under Arts. 21, 22 Brussels Convention cannot be raised.
The Brussels Convention is generally applicable, as the Netherlands as well as the Federal Republic of Germany are parties to the Convention, which went in force already on February 1, 1973. Art. 21 of the Convention does, however, not apply to the present case, because the main action and an application for interim measures do not cover the same "claim" in the sense of Art. 21 (cf. Kropholler, Europäisches Zivilprozessrecht, Kom. zum EuGVÜ, 5th ed. 1996, Art. 21 para. 11 with further references). However, this result cannot just be founded by the German procedural law's view of the relation between main action and action for interim measures. According to the decisions of the European Court of Justice (8 December 1987, Rs- 144/86, Gubisch Maschinenfabrik v. Palumbo, NJW [*] 1989, p. 665; 6 December 1994, C 406/92 Tatry vs Maciej Rataj, JZ [*] 1995, 616, 619) the terms used in Art. 21 to characterize the situation of proceedings pending at two places have to be interpreted according to the objective of the Convention: to ease the recognition of court decisions of other States which are party to the Convention. This objective calls for an autonomous interpretation independent from the national procedural law of a particular Member State.
The wording, system and objective of the Brussels Convention support the result that an application for interim measures before the court of a Member State should not conflict with a proceeding before the court of another Member State on the main action. The Brussels Convention's terminology clearly distinguishes between "actions" (Art. 21) and "applications for interim measures" (Art. 24). An arrest is an interim measure in this sense. The objection of lis alibi pendens under Art. 21, does, according to the wording, only apply to "actions" concerning the same claim at courts of different Member States. The system of the Convention also does not allow the application of Art. 21 beyond its wording to the relationship between applications for interim measures and main actions. As Art. 24 of the Brussels Convention allows application for interim measures at the courts of one Member State, even though the courts of another Member State have the competence to decide the claim, it would be possible for one party to deprive the other party of the court originally competent (cf. Kropholler, Art. 21 para 11). This would overstretch purpose of Art. 21 which is only aimed at avoiding contradicting decisions of the main claim, not at creating a uniform place of jurisdiction for main action and interim measures.
Also, the proceeding can neither be suspended at the Court's discretion under Art. 22 para. 1 nor does the Court have the option of declaring itself incompetent under Art. 22 para. 2. Art. 21 is inapplicable for the reason that the main action as well as the application for interim measures are not pending before first instance courts. In addition, the application for arrest is not an action in the sense of Arts. 21, 22 Brussels Convention (cf. Kropholler, Art. 22 para. 5 with further reference). Moreover, the connection required by Art. 22 para. 3 is not given, because the danger of contradicting decisions does not exist. The final decision overrules any interim decision that is only aimed to regulate the situation in the time it takes to make a final decision.
Art. 22 para. 2 does not allow German courts to declare themselves incompetent, because a joinder of the two proceedings would be inadmissible under German law. � 147 ZPO [*] only allows a joinder if both proceedings are pending at the same court.
Therefore, the Buyer has a claim for US $218,840.06 plus 5% interest since 8 June 1995.
The CISG is applicable to the legal relationship between the parties according to its Art. 1(1) in connection with the rules of the German international private law, especially Art. 28 EGBGB [*].
According to Art. 1(1), the CISG is applicable to contracts for the sale of goods if the parties have their place of business in different States, where these States are parties to the Convention or if the rules of international private law lead to the application of the law of a Contracting State. Great Britain, the State where the Buyer has its place of business is not a Contracting State. The rules of international private law do, however, lead to the application German law. The CISG entered into force in Germany on 1 January 1991.
According to Art. 28 EGBGB, in the absence of a choice of law, a contract with a relation to another country is subject to the law of the State to which it has the closest connection. A choice of law was not made in the present case. For a contract which was concluded for a commercial purpose, the place of business of the party which has to perform the characteristic obligation of the contract is the most important indication for this (Art. 28 para. 2, 1st and 2nd sentence EGBGB). The characteristic obligation of a sales contract is the obligation to deliver the goods (cf. Palandt-Heldrich, 56. ed. 1997, Art. 28 EGBGB para. 3). The Seller, which had to deliver the goods has its place of business in Germany, therefore German law is applicable and Art. 1(1)(b) CISG leads to the application of the CISG.
The requirements Art. 75 CISG establishes for awarding damages for concluding a cover purchase are given.
The Buyer was entitled to avoid the contract of October 12, 1994 under Art. 49(1)(a) as well as under Art. 49(1)(b) CISG.
The Seller had not fulfilled its obligation to deliver under the sales contract of 12 October 1994, on time at the time the cover purchase was concluded on 11 January 1995. Not fulfilling the obligation to deliver on time has to be regarded as a fundamental breach of contract in the sense of Art. 49(1)(a), Art. 25 CISG. A delay does not generally amount to a fundamental breach, but only, if the exact compliance with the delivery date is of special interest for the Buyer and if the Seller could recognize this at the time of contract conclusion (Huber in: v. Caemmerer/Schlechtriem - in the following: Schlechtriem/Author - Kommentar zum einheitlichen UN-Kaufrecht - CISG - , 2nd edition, 1995, Art. 49 CISG para. 5; Staudinger-Magnus, 13th ed. 1994, Art. 49 CISG para. 11). This special interest can be inferred from the use of the Incoterm "CIF" which makes clear that the contract was a contract for delivery by a fixed date (Baumbach/Hopt, HGB [*], 29th ed. 1995, Incoterms No. 6 para. 2) under which timely delivery is a fundamental obligation. Moreover, a fundamental breach is also given because the Seller stated by fax of 14 December 1994 that it was negotiating with its supplier about contract fulfilment or damages and therefore needed time. By this statement, the Seller left the Buyer in complete uncertainty as to whether and when it would comply with its obligation to deliver.
The Buyer was also entitled to avoid the contract under Art. 49(1)(b) CISG. The declaration by the Buyer on 3 November 1994, that it agreed to a loading date not later than 30 November 1994 and that this time limit was very important has to be regarded as the setting of an additional period of time under Art. 49(1)(b) CISG. The Buyer has thereby clearly and warningly urged to perform by a certain date (cf. Schlechtriem-Huber, Art. 49 CISG para. 20) and has also threatened to make a cover purchase in case of non-compliance with the date fixed. It has not been contested that the Seller has not complied with this additional period of time. Therefore, the Buyer had a right to avoid the contract irrespective of whether it was the Seller's fault (cf. Staudinger-Magnus Art. 49 CISG para. 8) that the goods were not delivered.
The Court does not have to investigate whather the Buyer has avoided the contract before concluding a cover purchase, as Art. 75 CISG would normally require. Doubts about a declaration of avoidance before the conclusion of the cover purchase are caused by the fact that the fax of 17 January 1995 does not exactly prove when the Buyer informed the Seller of the cover purchase and thereby impliedly declared the contract avoided. The communications before -- the faxes of 13 December 1994, 16 December 1994 and 29 December 1994 -- do not make clear that the Buyer intended to avoid the contract. A declaration of avoidance under the condition of performance which is generally admissible, (BGHZ [*] 74, 193, 204 and Schlechtriem-Huber, Art. 49 CISG para. 31), was not made. Such a declaration cannot be seen in the fax messages mentioned above, nor in the fax message of 3 November 1994, because this would require that the Buyer actually wanted to lose its right to choose between contract fulfilment and damages by sending the messages. The communication submitted to the Court would contradict that conclusion because the Buyer insisted on its claim for "performance of the contract".
However, an explicit declaration of avoidance was not necessary because, before Buyer made the cover purchase, the Seller had seriously and finally refused to perform under the sales contract. Although the CISG does not make an exception from the requirement of a declaration of avoidance, the rule of the "observance of good faith in international trade" (Art. 7(1) CISG) leads to the result that a declaration of avoidance is not necessary, if it is certain that the other party will not perform its obligations in a case (cf. Schlechtriem-Stoll Art. 75 CISG, para. 5; Staudinger-Magnus, Art. 75 CISG para. 8 and Stoll, RabelsZ [*] vol. 52 (1998), 617, 635).
The Seller uttered its serious refusal at the latest by the fax of 29 December 1994, which was the answer to the Buyer's fax of 16 December 1994, in which the Buyer continued to demand contract fulfilment and threatened to demand damages. It has not reacted to the Buyer's fax by a new offer to fulfil the contract but has merely offered the payment of a "compensation". While knowing that the Buyer obviously did not want to wait for the result of the negotiations between the Seller and its Chinese supplier, the Seller did not want to fulfil its obligations by acquiring the goods from a different source but only by paying damages or a compensation. In this situation, the Seller could not in good faith assume that it would still have the option to fulfil the contract, especially since it knew that the contract was a fixed-date transaction and since the Buyer had emphasized the importance of timely delivery several times.
Obviously, the Seller did not assume that it still had the option to fulfil the contract, as it has stated in a memorandum of 14 August 1995 that the Buyer could undisputedly no longer expect delivery in January 1995. Although the requirements to assume a refusal to deliver are high, at least the fax of 29 December 1994 has to be regarded as such a refusal. The Seller did not need the protection by a declaration of avoidance since it did not itself try to fulfil the contract.
This result is not opposed by the fax of 17 January 1995, in which the Seller again offered to deliver iron-molybdenum. This offer was obviously not intended as an offer for the fulfilment of the sales contract of 12 October 1994 but represented an offer for the conclusion of a new sales contract. This cannot only be inferred from the new price which deviates considerably from the old one but also from the reference to the non-fulfilment of the contract of 11 October 1994, for which the new and purportedly cheap offer should be a compensation.
The contract which was concluded by the Buyer on 11 January 1995 is an appropriate cover purchase in the sense of Art. 75 CISG. Under this contract, which resembles the contract of 12 October 1994, (amended on 31 October 1994, Exhibits K 4 and K 6) with respect to the amount and the quality of the iron-molybdenum, the Buyer has acquired material from a third party, therefore the contracts suitability to cover the Buyer's fulfilment interest. Also the connection in time between the two contracts is so close that reasonable doubts concerning the contract's designation as a cover transaction are not present. With respect to the development of prices which is proven by the Seller's offer of 17 January 1995, no indication is given for the assumption that the cover purchase was not concluded in a manner in accordance to business usage. The cover purchase was also concluded within a reasonable period of time, approximately two weeks, after the refusal to deliver which replaces the declaration of avoidance in the instant case. This period of time has to be granted for orientation and consideration and for inviting offers, especially since -- in contrast to � 376 para. 3 HGB [*] -- the CISG does not require the Buyer to conduct the cover purchase "immediately" (cf. Staudinger-Magnus, Art. 75 CISG para. 18; Schlechtriem-Stoll, Art. 75 CISG para. 8).
The Seller is also not exempted from liability under No. 2 of the Contract Conditions ("force majeure") or under Art. 79 CISG. It is not necessary to refer to the wording of No. 2 of the "Conditions" to discover that this clause does not lead to an exemption from liability that would have a greater effect than Art. 79 CISG. Impediments that do not fall within the contractual sphere of risk of a party and could not be controlled by the Seller are "force majeure" in the sense of this provision. Therefore, the provision has the same effect as Art. 79 CISG according to which a party is not liable for non-fulfilment if it was caused by an impediment which was outside its sphere of influence and could not be avoided or overcome, while in this context the possibility to avoid or overcome an impediment has to be judged according to the contractual allocation of risks (cf. Schlechtriem-Stoll, Art. 79 CISG, para. 16 et seq.).
The requirements of an exemption under Art. 79 CISG are not given. The delivery by one's own supplier is a part of the general risk to acquire the goods, which is, according to the typical sense of the contract, born by the Seller if the contract is not limited to a certain production or storage. The Seller is not exempted if its supplier has not delivered, even if the supplier's action was unforeseeable and a breach of contract. Such an impediment can be overcome by the Seller as long as there are replacement goods available on the market. Even if the exact quality required by the contract of 12 October 1994 could not be acquired on the Chinese market, an argument the Seller has not even raised, replacement material slightly deviating with respect its composition but reasonable according to commercial perception could have been acquired. The Buyer would have accepted the delivery of such slightly worse material, as the fax of 31 October 1994 shows.
The acquisition risk is therefore only exceeded and the Seller is only exempted, if the goods were not available in comparable quality and if the Seller did not need to take this into account at contract conclusion (Schlechtriem-Stoll, Art. 79 CISG, para. 30). The Seller bore the burden of proof on this issue and has not demonstrated this. Also, the Seller cannot rely on having excluded liability in case it had not been supplied correctly and on time. It is irrelevant whether such a reservation can be inferred from No. 2 of the Contract Conditions. This objection by the Seller is unfounded because the transaction of August 29, 1994 submitted as Exhibit B2 only in the appeal does not meet the requirements for a congruent cover purchase (cf. BGHZ 92, 396, 401). The fulfilment of those requirements: corresponding amount and quality as well as corresponding times for delivery and loading has not been demonstrated by the Seller. In addition, the Seller has not made any declaration as to why its supplier did not deliver, therefore the requirements of Art. 79(2) (exemption of a third person) are not given as well.
The Seller is also not exempted by the fact that acquiring the goods elsewhere would have led to considerable financial loss because it would have had to pay a higher price. The Seller generally bears the risk of considerable extra expenses in connection with acquiring the goods elsewhere, even the loss of transactions, as it has accepted the risk of acquiring the goods and the risk that they cannot be acquired at a certain price.
Despite of the triplication of market price that had to be paid for Chinese iron-molybdenum, an excess of the absolute limit of sacrifice is not given (cf. Schlechtriem-Stoll, Art. 79 CISG para. 40). For parties doing business in a sector that has a very speculative aspect the limits of reasonability are very high. The contract was therefore not commercially unreasonable to an extent that it could be regarded as frustrated.
The Buyer's claim for damages is not limited by a failure to mitigate damages in the sense of Art. 77 CISG.
It has to be assumed that the increase in the market price for iron molybdenum until 29 December 1994 was within the Seller's sphere of risk, since before that date an avoidance of the contract could not be assumed and consequently the Seller had to acquire replacement goods if necessary.
The earliest point in time when the Seller should have organized a cover purchase was after receiving the fax the Seller sent on 29 December 1994. The Seller has, however, neither demonstrated that a considerable rise in the price of iron-molybdenum had occurred between the end of December 1994 and 11 January 1995 nor given any indication why the Buyer had violated its duty to mitigate damages by not taking appropriate efforts to conclude a cheaper cover purchase. In this respect it has to be taken into account that it took the Buyer only two weeks to conclude the cover purchase. The Buyer had to decide within this time, if and when it wanted to conclude a cover purchase. The Seller has not sufficiently demonstrated that a cheaper cover purchase would have been possible within this period of time. The Buyer was not obliged to refrain from a cover purchase merely because of the high market price.
The Buyer has calculated the additional costs caused by the cover purchase correctly: the amount is US $218,840.06. The Seller has not contested this calculation. The District Court has correctly ordered a payment in US dollars, because under a concrete calculation of damages as it is required by Art. 75 CISG damages in the currency of the loss are owed (cf. Schlechtriem-Stoll, Art. 74 CISG para. 30).
The Buyer's claim for 5% interest since the dispute was pending results from �� 286, 288 BGB [*] in connection with � 352 HGB [*].
The Seller is the party that was not successful. It has to bear the costs of the appeal according to � 97 para. 1 ZPO [*].
The other side-decisions result from �� 708 No. 10, 711 and � 546 ZPO.
* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff-Appellee of Great Britain is referred to as [Buyer]; Defendant-Appellant of Germany is referred to as [Seller]. Amounts in U.S. currency (dollars) are indicated as [US $]; amounts in the former currency of Germany (Deutsche Mark) are indicated as [DM].
Translator's note on other abbreviations: BGB = Bürgerliches Besetzbuch [German Civil Code]; BGHZ = Entscheidungen des Bundesgerichtshofes in Zivilsachen [Official Reporter of Decisions of the German Federal Supreme Court on Civil Matters] EGBGB = Einführungsgesetzbuch zum Bürgerlichen Gesetzbuche [German Code on Private International Law]; HGB = Handelsgesetzbuch [German Commercial Code]; JZ = Juristenzeitung [German law journal]; NJW = Neue Juristische Wochenschrift [German law journal]; RabelZ = Rabels Zeitschrift für ausländisches und internationals Privatrecht [German law journal]; ZP0 = Zivilprozessordnung [German Code on Civil Procedure].

matches:
art. 49
Art. 79
Art. 75
Art. 49
Art. 79
Art. 79
Art. 79
Art. 21
Art. 21
Art. 21
v.
Art. 21
Art. 21
Art. 21
Art. 24
Art. 21
Art. 21
Art. 22
Art. 22
Art. 21
Art. 22
Art. 22
Art. 22
Art. 1
Art. 28
Art. 1
Art. 28
Art. 28
Art. 1
Art. 75
Art. 49
Art. 49
Art. 49
Art. 25
v.
Art. 49
Art. 49
Art. 49
Art. 49
Art. 49
Art. 49
Art. 75
Art. 49
Art. 75
Art. 75
Art. 75
Art. 75
Art. 75
Art. 79
Art. 79
Art. 79
Art. 79
Art. 79
Art. 79
Art. 79
Art. 79
Art. 77
Art. 75
Art. 74


In re Vitamin C Antitrust Litig.
In re VITAMIN C ANTITRUST LITIGATION. This document relates to: Animal Science Products, Inc., et al., Plaintiffs, v. Hebei Welcome Pharmaceutical Co. Ltd., et al., Defendants.
James T. Southwick and Shawn L. Raymond, Susman Godfrey L.L.P., for Federal Plaintiff Animal Science Products, Inc. and The Runís Company, Inc. Darrell Prescott, Charles H. Critchlow, Catherine Y. Stillman, Baker & McKenzie LLP, for Hebei Welcome Pharmaceutical Co., Ltd. and North China Pharmaceutical Group Corporation.
Daniel S. Mason, Jiangxiao Hou, Eric W. Buetzow, Zelle Hofmann Voelbel & Mason LLP, for Weisheng Pharmaceutical (Shijiazhuang) Co., Ltd., and China Pharmaceutical Group Co., Ltd.
This litigation arises out of allegations that defendants, several Chinese vitamin C manufacturers, conspired to “suppress competition by fixing the price and controlling export sale volumes of vitamin C offered for sale to customers in the United States and elsewhere.” Defendants move to dismiss, for lack of subject matter jurisdiction, the Third Amended Complaint insofar as it refers to claims by foreign purchasers of vitamin C. Defendants also move to exclude or strike evidence related to foreign purchasers, including the inclusion of foreign purchaser claims in the damages calculations performed by Professor Bernheim, plaintiffs' expert. Finally, defendants move to exclude or strike evidence referring to sales made by two non-defendants that are alleged to be co-conspirators. For the reasons set forth below, defendants' motions are denied.
The Court previously certified a class of Direct Purchaser plaintiffs who “directly purchased vitamin C for delivery in the United States, other than pursuant to a contract containing an arbitration clause, from any Defendants or their co-conspirators, other than Northeast Pharmaceutical (Group) Co. Ltd., from December 1, 2011 to June 30, 2006” (the “Direct Purchaser Damages Class”). Defendants argue that “taken literally, this class definition would sweep in claims by foreign purchasers involving solely foreign sales by foreign defendants.” Specifically, in a number of cases, defendants sold vitamin C for delivery in the United States directly to businesses located in Japan, China, Canada, or Europe, and those businesses, in turn, resold the vitamin C to U.S. customers.
Defendants assert that sales to these foreign purchasers are outside the scope of the antitrust laws and any U.S. entities that acquired vitamin C through an intermediary foreign purchaser are, in fact, indirect purchasers and are thus excluded from the Direct Purchaser Damages Class. Defendants take issue with the damages calculations performed by plaintiffs' expert, Professor Bernheim, because he relied on U.S. customs data regarding vitamin C deliveries through U.S. ports, even though some of these deliveries were the result of foreign resales of vitamin C to U.S. customers rather than direct sales by defendants to U.S. customers.
Defendants also highlight the fact that the Ranis Co., Inc. (“Ranis”), the class representative for the Direct Purchaser Damages Class, is, in part, an indirect vitamin C purchaser. Ranis is the assignee of the claims of the Graymoor Chemical Co., Inc. (“Graymoor”). Graymoor made direct vitamin C purchases from defendants but also made a number of purchases of vitamin C manufactured by defendants through two Canadian intermediary companies.
Plaintiffs paint a very different picture of the foreign purchasers. They argue that what defendants “call ‘foreign purchasers' are either multinational corporations with a substantial presence in the United States or overseas brokers purchasing vitamin C delivered in the United States” and what defendants “call ‘foreign sales by foreign defendants' are actually shipments of vitamin C by Defendants directly from China to ports in the United States, without stops in any other country.” The purchases were not foreign purchases that were then resold to U.S. buyers, according to plaintiffs. Rather, all of the purchases were made directly from defendants for delivery in the United States. Plaintiffs offer two examples of these kinds of purchases.
One example involves Mitsubishi International Food Ingredients, Inc. (“MIFI”), an Ohio-based subsidiary of the Japanese multinational Mitsubishi Corporation. In 2005 MIFI contracted to purchase $63,000 worth of vitamin C from one defendant, Weisheng, which agreed to ship the vitamin C directly from China to Pennsylvania. Two months later, MIFI purchased $61,200 of vitamin C, again to be shipped directly from China to Pennsylvania, but the contract for this transaction was executed by a Mitsubishi executive in Japan.
The second example involves instances where a U.S. company worked with a foreign broker to purchase vitamin C for delivery in the U.S. Although Ranis purchased vitamin C directly from defendants, it also used the services of a Canadian broker, Pacific Resource Trading. Other contracts offered by defendants show that He–Ro Chemicals Ltd., a Hong Kong-based broker, purchased vitamin C from defendant Hebei to be shipped directly from China to California. Lastly, a British Virgin Islands company, Sannex Products Ltd., purchased vitamin C from Aland, a former defendant (it has settled), to be shipped directly to Charles Bowman & Co. in Michigan. Indeed all of the exhibits that defendants provide show U.S. locations as the destinations for the vitamin C to be delivered.
The core of defendants' argument is that the foreign purchaser claims fall outside of the Court's subject matter jurisdiction and are barred by the Foreign Trade Antitrust Improvements Act, 15 U.S.C. § 6a (“FTAIA”). The FTAIA “excludes from the Sherman Act's reach much anticompetitive conduct that causes only foreign injury.” F. Hoffmann–La Roche Ltd. v. Empagran S.A., 542 U.S. 155, 158, 124 S.Ct. 2359, 2363, 159 L.Ed.2d 226 (2004).
There is currently an unsettled legal question concerning whether the FTAIA “affects the subject-matter jurisdiction of the district court or if, on the other hand, it relates to the scope of coverage of the antitrust laws.” Minn–Chem, Inc. v. Agrium, Inc., 683 F.3d 845, 851 (7th Cir.2012). A line of recent Supreme Court cases has emphasized that questions about a statute's reach are merits issues, not issues of subject matter jurisdiction. See Morrison v. Nat'l Australia Bank Ltd., ––– U.S. ––––, 130 S.Ct. 2869, 2877, 177 L.Ed.2d 535 (2010) (“But to ask what conduct § 10(b) [of the Securities Exchange Act] reaches is to ask what conduct § 10(b) prohibits, which is a merits question. Subject-matter jurisdiction, by contrast, refers to a tribunal's power to hear a case.”) (internal quotation marks omitted). See also Arbaugh v. Y & H Corp., 546 U.S. 500, 516, 126 S.Ct. 1235, 1245, 163 L.Ed.2d 1097 (2006) (“when Congress does not rank a statutory limitation on coverage as jurisdictional, courts should treat the restriction as nonjurisdictional in character.”). In light of this line of cases, the Seventh Circuit has held that “the FTAIA sets forth an element of an antitrust claim, not a jurisdictional limit on the power of the federal courts.” Minn–Chem, 683 F.3d at 852. The Third Circuit has also concluded that “the FTAIA constitutes a substantive merits limitation rather than a jurisdictional limitation.” Animal Sci. Prods., Inc. v. China Minmetals Corp., 654 F.3d 462, 467–68 (3d Cir.2011).
Since Morrison, however, the Second Circuit has not opined on whether the FTAIA is jurisdictional. Under pre-Morrison Second Circuit law, the FTAIA was considered to be a limitation on the subject matter jurisdiction of the federal courts. See Sniado v. Bank Austria AG, 378 F.3d 210, 212 (2d Cir.2004) (“affirm[ing] the district court's dismissal of [the] complaint for lack of subject matter jurisdiction under § 6a(2) of the FTAIA”); Filetech S.A. v. France Telecom S.A., 157 F.3d 922 (2d Cir.1998). Even post-Morrison, courts in the Second Circuit have continued to discuss the FTAIA in subject matter jurisdiction terms. See Precision Assocs., Inc. v. Panalpina World Transp. (Holding) Ltd., No. 08–cv–42, 2011 WL 7053807 (E.D.N.Y. Jan. 4, 2011) (report and recommendation), adopted at,2012 WL 3307486 (E.D.N.Y. Aug. 13, 2012).
The question of whether the FTAIA is jurisdictional would matter if defendants had waived their ability to bring this motion, as plaintiffs imply. Plaintiffs argue that defendants should not have waited until only weeks before trial was originally set to begin before bringing this motion since, it appears, that defendants had Professor Bernheim's report for almost four years before making the motion. In response, defendants argue that since the FTAIA goes to the Court's subject matter jurisdiction, they can bring this motion at any time under Rule 12(h)(3) of the Federal Rules of Civil Procedure. The Court is sympathetic to plaintiffs' position. However, the scheduling orders in place in this action allowed the parties to bring dispositive motions concerning damages, among other things, at the time when defendants brought this motion. Since the instant motion arises out of Professor Bernheim's use of a methodology that included foreign purchaser claims in his damages calculation—an issue that was developed recently during expert discovery—and defendants' motion challenges plaintiffs' entitlement to recover that portion of their alleged damages, the Court concludes that the instant motion is timely under its scheduling orders. Thus, defendants' motion is timely whether it is characterized as a motion to dismiss for lack of subject matter jurisdiction or a motion on the merits of plaintiffs' damages claims.
Defendants also argue the issue underlying this motion was not apparent until expert discovery, which only concluded recently.
Likewise, the Court does not need to decide whether the FTAIA is jurisdictional in order to determine what standard to apply to defendants' motion. Although the analysis involved in deciding a motion to dismiss for lack of subject matter jurisdiction is different from the analysis involved in deciding a motion for summary judgment on an element of a claim, that distinction is irrelevant for this motion because there are no material facts in dispute. Both parties agree that the vitamin C at issue was bought overseas by foreign purchasers and shipped into the United States. The parties only offer competing interpretations of these facts. The only task for the Court, therefore, is to determine whether, on these facts, the FTAIA bars the foreign purchaser claims or not. If the Court concludes, as it does, that plaintiffs have demonstrated that the FTAIA does not bar their foreign purchaser claims, then defendants' motion must be denied regardless of whether it is construed as jurisdictional or as a motion for summary judgment.
The Seventh Circuit has observed that the import trade or commerce exception is not, strictly speaking, an ‘exception’ from the FTAIA. See Minn–Chem, 683 F.3d at 854. This Court adopts the term only for ease of reference.
Plaintiffs argue that the FTAIA is not applicable to the foreign purchaser claims because defendants' conduct falls within the import exception. They argue that although some of the vitamin C may have been paid for through transactions with foreign entities that occurred abroad, “[t]he very contracts attached to Defendants' motion illustrate that in exchange for payments from class members to Defendants, the Defendants put vitamin C on a ship and sent it directly to a U.S. port.” Defendants, on the other hand, emphasize the importance of the location of the transaction, the buyer, and the seller, and argue that because the foreign purchaser claims involved transactions between foreign buyers and foreign sellers that took place abroad, the import exception does not apply.
Defendants' interpretation of the import exception is too narrow. Although the FTAIA “does not define the term ‘import,’ ... the term in general denotes a product (or perhaps a service) has been brought into the United States from abroad.” Turicentro S.A. v. Am. Airlines, 303 F.3d 293, 303 (3d Cir.2002), overruled on other grounds, Animal Sci. Prods., 654 F.3d at 467–68. Additionally, the FTAIA “makes clear that not only import commerce, but conduct involving import commerce, is never removed from the reach of the Sherman Act.” In re Air Cargo Shipping Servs. Antitrust Litig., 2008 WL 5958061, at *12. Although the import commerce exception “must be given a relatively strict construction[,]” Carpet Grp., 227 F.3d at 72, it does not require “that the defendants function as the physical importers of goods.” Animal Sci. Prods., 654 F.3d at 470. “Rather, the relevant inquiry is whether the defendants' alleged anticompetitive behavior ‘was directed at an import market.’ ” Id. (quoting Kruman v. Christie's Int'l PLC, 284 F.3d 384 (2d Cir.2002), abrogated on other grounds by Empagran, 542 U.S. at 161, 124 S.Ct. at 2364).
Here, plaintiffs have demonstrated that defendants' conduct was directed at the U.S. import market. The Third Amended Complaint alleges that “defendants and their co-conspirators have participated in meetings and conversations in China and elsewhere in which the price, volume of sales and exports to the United States, and markets for vitamins were discussed and agreed upon.” The sale contracts provided by the parties show that defendants specifically contracted for the delivery of vitamin C to locations within the U.S. Even though many of the transactions at issue took place abroad among foreign parties, the intent and result of those transactions was the direct importation of vitamin C into the U.S. See Minn–Chem, 683 F.3d at 854 (“The applicability of U.S. law to transactions in which a good or service is being sent directly into the United States, with no intermediate stops, is both fully predictable to foreign entities and necessary for the protection of U.S. consumers.”).
A comparison of defendants' conduct to the facts in other cases addressing the import exception demonstrates that the exception applies. In Carpet Group, the court found that the exception applied where plaintiffs alleged that defendants took steps to “(1) prevent foreign manufacturers from selling to United States retailers, (2) prevent at least one American retailer from purchasing rugs directly from foreign manufacturers, (3) prevent foreign governments and trade associations from sponsoring trade fairs at which retailers could purchase directly from foreign manufacturers, and (4) prevent an American rug retailers' association from sponsoring the trade fairs.” 227 F.3d at 72. The exception was also found to apply in In re TFT–LCD (Flat Panel) Antitrust Litig., No. M 07–1827, 2012 WL 3763616 (N.D.Cal. Aug. 29, 2012), where foreign defendants shipped and invoiced the products to the United States, before they were shipped to Mexico for finishing, and ultimately returned to the United States to be sold to consumers.
On the other hand, the exception has been found not to apply where goods or services were not delivered directly into the United States. In Turicentro, defendant air carriers conspired to fix commission rates paid to plaintiffs, travel agents based outside the United States. Even though some U.S. customers purchased plaintiffs' services, the Third Circuit held that because “[d]efendants did not directly bring items or services into the United States” and defendants “did not directly increase or reduce imports into the United States,” defendants were not “engaged in ‘import trade or commerce.’ ” 303 F.3d at 303. Likewise in Kruman, the Second Circuit found that the exception did not apply where “the defendants' conspiracy appears to have been directed at controlling the prices they charged for their services in foreign auctions.” 284 F.3d at 395. The Second Circuit specifically noted that “the commerce that is the focus of this case is the charging of fixed commissions on the purchase and sales of goods at foreign auctions, not the trade and subsequent movement of the goods that were purchased and sold.” Id.
Alternatively, plaintiffs argue that even if the FTAIA applies, the foreign purchaser claims would remain within the reach of the Sherman Act because of their “direct, substantial, and foreseeable effect” on domestic commerce in vitamin C and because this effect gives rise to a Sherman Act claim. 15 U.S.C. § 6a(1)-(2). Defendants maintain that plaintiffs cannot avail themselves of this domestic effects exception because plaintiffs have failed to show that the domestic effects of their conduct proximately caused plaintiffs' foreign injuries. The Court agrees with defendants that “under FTAIA the domestic effects must occur first and then proximately cause the foreign antitrust claim.” In re Hydrogen Peroxide Antitrust Litig., 702 F.Supp.2d 548, 551 (E.D.Pa.2010). Although it is a close issue, the Court concludes that the domestic effects exception applies.
In determining whether there is a “direct, substantial, and foreseeable effect” on domestic commerce under § 6a(1), “[t]he geographic target of the alleged anticompetitive conduct matters greatly.” Turicentro, 303 F.3d at 305. Further, courts have concluded that allegations “consisting of Defendants' participation in an overarching worldwide conspiracy to raise, stabilize, and maintain [ ] prices, and Defendants' establishment of price-fixing agreements ... both inside and outside of the United States ... adequately pleads that Defendants' conduct had the necessary effect on domestic commerce within the meaning of § 6a(1).” Latino Quimica–Amtex S.A. v. Akzo Nobel Chems. B.V., No. 03 Civ. 10312, 2005 WL 2207017, at *6 (S.D.N.Y. Sept. 8, 2005) (internal quotation marks omitted).
Here, plaintiffs alleged not only that defendants conspired to fix the prices they charged for vitamin C on the global market, but also that they “deliberately targeted and severely burdened consumers in the United States.” Consistent with their pleading, plaintiffs have demonstrated, through the sales contracts, that defendants shipped their vitamin C products directly to the United States. Indeed, the definition of the Direct Purchaser Damages Class only encompasses those who purchased defendants' vitamin C for delivery in the United States. Super-competitive prices for vitamin C in the United States were the “direct, substantial, and foreseeable effect” of defendants' conduct, and defendants do not argue otherwise. Therefore, the first prong of the domestic effects exception is satisfied.
[w]hile maintaining super-competitive prices in the United States may have facilitated the [defendants'] scheme to charge comparable prices abroad, this fact demonstrates at most but-for causation. It does not establish ... that the U.S. effects of the [defendants'] conduct—i.e., increased prices in the United States—proximately caused the foreign [plaintiffs'] injuries.
[a]lthough the complaint's description of ‘the global nature of the wheat pricing mechanism’ may paint a plausible scenario by which [defendants'] conduct in Iraq might well have been a factual, or ‘but for,’ cause of a drop in domestic wheat prices, such ‘but for’ causation is not the type of direct causation contemplated by the FTAIA. Accepting as true plaintiffs' allegations that [defendants'] conduct foreclosed the Iraqi wheat market to U.S.-grown wheat, that this foreclose affected the projected Ending Stocks for U.S.-grown wheat, and that the ‘main determinant’ of domestic wheat prices is the level of projected Ending Stocks, the fact remains that a myriad of other factors—including foreign and domestic market conditions, crop yields, harvesting and transportation costs, and other factors affecting global supply and demand—also impacted projected Ending Stocks, and hence domestic wheat prices during the proposed class period.
Boyd v. AWB Ltd., 544 F.Supp.2d 236, 244–45 (S.D.N.Y.2008) (internal citations omitted).
This case could not be more different from Boyd. Defendants' agreement to restrain production and fix vitamin C prices increased prices of vitamin C to be delivered to the United States. Since the foreign purchasers were buying vitamin Cfor delivery to the United States, the super-competitive prices that they paid were the direct result of the increased prices caused by defendants' conduct. Defendants have not identified, nor is the Court aware of, any intervening factors that may have influenced the price the foreign purchasers paid other than defendants' anticompetitive conduct. Moreover, plaintiffs do not rely on the arbitrage theory of causation that was at issue in Empagran. Their argument is not that the foreign purchasers were overcharged because they paid a super-competitive global price which was maintained, in part, by a super-competitive price in the United States. Instead, plaintiffs' (albeit imperfectly articulated) theory is that because the foreign purchasers were buying vitamin C for delivery in the United States, the super-competitive prices they paid were the immediate result of defendants' conspiracy to fix prices for vitamin C delivered to the United States.
The cases on which defendants rely are inapposite because the goods at issue in those cases never reached the United States and were not being purchased for delivery to the United States. See Empagran, 542 U.S. at 159, 124 S.Ct. at 2364 (addressing a motion to dismiss the claims of “five foreign vitamin distributors located in Ukraine, Australia, Ecuador, and Panama, each of which bought vitamins from [defendants] for delivery outside the United States”); In re Dynamic Random Access Memory (DRAM) Antitrust Litig., 546 F.3d 981, 989 (9th Cir.2008) (ruling that, where plaintiff was “a foreign consumer that made its purchases entirely outside of the United States,” its allegations that “super-competitive DRAM prices in the United States may have facilitated the defendants' scheme to charge super-competitive prices abroad” did not satisfy the domestic effects exception); In re Monosodium Glutamate Antitrust Litig., 477 F.3d 535, 537 (8th Cir.2007) (affirming dismissal of claims of foreign corporations where they “do not assert that they purchased or attempted to purchase [chemicals] in the United States market.”); In re Hydrogen Peroxide Antitrust Litig., 702 F.Supp.2d 548 (dismissing claims for chemicals delivered in Europe); Latino Quimica–Amtex, 2005 WL 2207017 (dismissing claims for chemicals purchased by Mexican, Argentinian, and Colombian companies in foreign markets). Because here, the foreign purchasers were overcharged immediately because of their purchases of vitamin C for delivery to United States, I find that the domestic effects exception to the FTAIA applies.
Plaintiffs also rely on another decision in In re TFT–LCD (Flat Panel) Antitrust Litig., No. M 07–1827, 2010 WL 2610641 (N.D.Cal. June 28, 2010), in which the court dismissed Motorola's foreign purchaser claims under § 6a(2). The dispute there centered on “whether Motorola can seek to recover based on foreign-sold panels that were subsequently incorporated into Motorola products that Motorola and others—but not defendants—shipped to and sold in the United States.” Id. at *3. This decision is inapposite because there was no way that the foreign injury at issue—the overcharge to Motorola's foreign affiliates—could have been proximately caused by a domestic effect of defendants' conduct when it was the actions of Motorola and others, rather than defendants' conduct, that brought the goods into U.S. commerce. Here, by contrast, it was defendants' actions that brought vitamin C into U.S. commerce.
Still, defendants maintain that it is the location of the purchase or transaction, rather than the location of delivery that, is relevant for both the FTAIA analysis and the largely related question of whether the foreign purchasers have standing under the antitrust laws, which is discussed further below. Defendants cite two cases that, they contend, emphasize that the location of the transaction is the dispositive factor. See In re TFT–LCD (Flat Panel) Antitrust Litig., No. M 07–1827, 2012 WL 506327 (N.D.Cal. Feb. 15, 2012); In re Static Random Access Memory (SRAM) Antitrust Litig., 2010 WL 5477313 (N.D.Cal. Dec. 31, 2010). Defendants overstate the implication of these cases. Although the Flat Panel court opined that “it is the location of the purchase, not the ultimate destination of the [ ] products, that determines where the injury occurred,” 2012 WL 506327, at *3, the products at issue were “purchased in and sent to the United States.” Id. The court only rejected the argument that plaintiff's claims were non-actionable because it took possession of the products abroad and brought them into the U.S. itself. In SRAM, the court concluded that the direct purchaser “Plaintiffs' claims based on purchases of SRAM billed to the United States, even where the SRAM was shipped elsewhere, are not precluded by the FTAIA, because [direct purchaser] plaintiffs have satisfied the requirements of the domestic effect exception.” 2010 WL 5477313, at *7. Contrary to defendants' argument, these cases only show that payment for a product in the United States is sufficient to create a domestic effect for FTAIA and antitrust standing purposes. The cases do not make payment in the United States a necessary precondition for finding a domestic effect. In Empagran, the Supreme Court only held that a situation where both the purchase and the delivery of goods took place outside of the United States fails to satisfy the domestic effects exception. See542 U.S. at 159–60, 124 S.Ct. at 2364.Empagran leaves open the possibility that the domestic effects exception may be satisfied where either the purchase or the delivery of goods takes place within the United States. Indeed, defendants have cited no case where delivery of the goods into the United States was found to be insufficient for FTAIA purposes and the Court is unaware of any.
For a plaintiff to have standing under the antitrust laws, he “must have suffered an injury the antitrust laws were intended to prevent, and the injury must flow from that which makes the defendant's acts unlawful.” Turicentro, 303 F.3d at 307. There is no dispute that a foreign entity can have standing under the U.S. antitrust laws. See Eurim–Pharm GmbH v. Pfizer, Inc., 593 F.Supp. 1102, 1106 (S.D.N.Y.1984) (“When the activity complained of has a demonstrable effect on United States domestic or import commerce, foreign corporations injured abroad may seek recovery under the Sherman Act.”). In In re Air Cargo Shipping Servs. Antitrust Litig., the court recognized that an argument that foreign purchasers do not have standing to assert their claims because they lack a cognizable antitrust injury is intertwined with FTAIA considerations and concluded that because the claims were cognizable under the FTAIA import exception, “it follows that the plaintiffs have asserted an antitrust injury.” 2008 WL 5958061, at *15–16. Here, the Court has already concluded that the FTAIA does not bar the application of the antitrust laws to the foreign purchaser claims because the claims satisfy the import exception and, alternatively, the domestic effects exception. The Court adopts the approach in In re Air Cargo Shipping Servs. Antitrust Litig. and finds that the foreign purchaser claims are cognizable under the antitrust laws.
Defendants raise two principal challenges to the foreign purchasers' antitrust standing. First, defendants argue that the location of the transaction is the dispositive factor rather than the market into which the goods were delivered. For the same reasons already discussed in the context of the domestic effects exception, the Court does not accept that conduct which affects the U.S. market because the goods are delivered into the U.S. cannot constitute a cognizable antitrust injury merely because the purchase transaction took place abroad. Defendants have cited no authority to support such a rule and it is not implied by controlling precedent.
Second, defendants argue that allowing the foreign purchasers to assert claims would create a risk of double recovery because plaintiffs would also seek to “recover for the amount paid by the U.S. recipient of the shipment to the foreign reseller.” The definition of the Direct Purchaser Damages Class forecloses this risk. The class is limited to entities that purchased vitamin C directly from defendants. Where the foreign purchaser has a claim for the overcharge on a particular delivery of vitamin C, the U.S. recipient of that delivery would be, by definition, an indirect purchaser and outside of the defined class. Plaintiffs readily admit that “[w]hich entity qualified as the ‘direct purchaser’ in each of the transactions depends on how the particular purchase was structured, including with respect to the flow of payments.” The Court agrees with plaintiffs that distinguishing between the direct and indirect purchaser for a particular transaction “is irrelevant to determining whether this Court has subject matter jurisdiction over claims arising from such purchases” or whether the claims are cognizable and that this issue can be addressed during the claims administration process.
For this reason, defendants reliance on Howard Hess Dental Labs. Inc. v. Dentsply Int'l Inc., 424 F.3d 363 (3d Cir.2005), is unavailing. Dentsply does not address the FTAIA at all, nor the domestic effects of anticompetitive conduct where the relevant goods are delivered into the United States. All Dentsply stands for is that plaintiffs cannot avoid the bar on indirect purchaser damages under the antitrust laws “by claiming they were direct purchasers of drop shipments [shipments that were not sent through a dealer] when their complaint specifically alleges that they did not purchase directly from Dentsply.” Id. at 372–73.Dentsply's comment that “the fact that some of the teeth are drop shipped directly from Dentsply to Plaintiffs does not affect the economic substance of the transaction,” id. at 373, addressed the attempt by plaintiffs in that case to recharacterize their indirect purchaser claims as direct purchaser claims based solely on the delivery method even though dealers still functioned as intermediaries. Plaintiffs here are not attempting a similar recharacterization because some class member, whether foreign or domestic, purchased vitamin C directly from defendants in every instance with no intermediary.
Defendants' motion to strike “from Professor Bernheim's expert report any damages claimed with respect to sales made by defendants to foreign purchasers” and to exclude “from the evidence that Plaintiffs can present to a jury any portion of the record that refers to damages based on foreign purchases of vitamin C from defendants to foreign resellers” hinges on the exclusion of the foreign purchaser claims. Defendants' sole criticism of Professor Bernheim's report is that he included the 6.9 million kilograms of shipments corresponding to the foreign purchaser sales in his damages calculation. Since, however, the Court has not dismissed the foreign purchaser claims, defendants' motion to strike evidence related to these claims is denied.
Separately, defendants have moved to exclude from plaintiffs' damages calculations any purchases made from Shandong Zibo Hualong Co., Ltd. (“Hualong”) or Anhui Tiger Biotech Co. (“Tiger”), two non-defendants alleged to be co-conspirators. Defendants argue that plaintiffs have made no showing that these purchases were not made pursuant to contracts containing arbitration clauses and, therefore, that the purchases—which increase plaintiffs' damages by $7.4 million—fall outside the class definition.
Defendants have, essentially, moved for summary judgment on this category of purchases. Although Professor Bernheim admitted at his deposition that he did not establish whether the sales by Hualong and Tiger were made pursuant to contracts with arbitration clauses, defendants have not put forward any evidence that the contracts did, in fact, contain arbitration clauses. Whether these purchases fall outside of the class definition, therefore, remains a fact issue for the jury to determine. The Court is unwilling to dismiss claims for purchases that may very well be proper based solely on defendants' speculation. The fact that Professor Bernheim excluded from his damages calculation purchases made pursuant to known contracts with arbitration clauses where defendants themselves identified the purchases does not change this conclusion. The Court perceives no error in excluding purchases known to fall outside the class definition but retaining purchases that are not known to be improper.
Defendants' motion to dismiss the foreign purchaser claims, strike evidence related to the foreign purchaser claims, and strike evidence of purchases from Hualong and Tiger  is denied.


text:
Christy Lee Coffey, 34, Irvine, homemaker, to Robbie Dale Cox, 30, Irvine, wood products.
JPMorgan Chase Bank N.A. v. Steven King aka Steven R. King, $4,625.05 plus interest and costs, claimed owed.
FIA Card Services N.A. v. Michelle C. Smith Rose, $6,661.51 plus interest and costs, claimed owed.
State of Florida ex rel Treva L. Caton v. Karen D. Rue, complaint for child support.
Commonwealth of Kentucky ex rel Dixie A. Robinson v. Shawn C. Robinson, complaint for child support.
Central Bank & Trust Company v. Elbert Alan Mansfield aka Alan Mansfield, $19,020.50 plus interest and costs, claimed owed.
Central Bank & Trust Company v. Michael A. Jones and Tiffani L. Jones, $27,270 plus interest and costs, claimed owed.
Deutsche Bank National Trust Co. v. Kenneth Jones, Lisa Jones, Deutsche Bank National Trust Co. as trustee for Franklin Credit Trust Series I, $62,381.33 plus interest and costs, claimed owed.
Robin Denise Arvin and Stuart Arvin, joint petition for dissolution of marriage.
Chase Bank USA N.A. v. Nancy C. Bowling, $8,991.51 plus interest and costs, claimed owed.
Mattie McGee and Billy McGee v. Lona Williams, a minor, through her parent and next friend Leah L. Williams, seeking trial and judgment for damages claimed due to negligent operation of motor vehicle.
Jerry Tipton v. James Gordon Sneed and Jeri Meschelle Sneed, petition to approve custody agreement.
Zada Stamper v. Arthur Stamper, decree of dissolution of marriage.
UAE Investco 1 (Estill Co.) LLC v. unknown heirs of Anna Maude Berry et al, interpleader for action to determine rightful owners of mineral underlying Henderson property.
Lacosta Ann Martin v. Nicholas Wayne Townsend, petition for custody.
Capital One Bank (USA) N.A. fka Capital One Bank v. Bobby D. Blevins, $1,089.32 plus interest and costs, claimed owed.
GE Money Bank v. Rosette Baber, $815.04 plus interest and costs, claimed owed.
North Star Capital Acquisitions LLC v. Earl J. Peters, $3,674.10 plus interest and costs, claimed debt owed.
Bobby Isaacs v. Donald Means, seeking eviction.
Capital One Bank (USA) N.A. v. Michelle P. Muncie, $1,012.87 plus interest and costs, claimed owed.
Asset Acceptance LLC v. Janet L. Riddell, $812.10 plus interest and costs, claimed owed.
Asset Acceptance LLC v. Gladis Marcum, $713.59 plus interest and costs, claimed owed.
Heights Finance Corporation v. William J. Sewell, $673.71 plus interest and costs, claimed owed.
Heights Finance Corporation v. Nancy L. Reece and Lester Robert Jones, $2,680.80 plus interest and costs, claimed owed.
William H. Mays v. Carla Stamper, seeking eviction.
North Star Capital Acquisitions LLC v. Tracy L. Thompson, $2,912.85 plus interest and costs, claimed owed.
Capital One Bank (USA) N.A. fka Capital One Bank v. Tina M. Riddell, $2,112.01 plus interest and costs, claimed owed.
Capital One Bank (USA) N.A. fka Capital One Bank v. Tina M. Thacker, $631.12 plus interest and costs, claimed owed.
GE Money Bank v. Amanda Gilbert aka Amanda J. Gilbert aka Amanda J. Smith, $3,259.78 plus interest and costs, claimed owed.
GE Money Bank v. Dwayne Adams aka Dwayne S. Adams aka Scott Adams, $2,658.14 plus interest and costs, claimed owed.
Traditional Bank Inc., Wesley Boyd Jenkins, Jerri Jenkins, Bluegrass Foam & Plastics Inc. also dba Miller’s Vending, and Countrywide Home Loans Servicing L.P. assignee of Mortgage Electronic Registration System Inc. by Michael Dean, master commissioner, to Traditional Bank Inc., $20,000, lot 1 and part of lot 2 of Lilly subdivision of Irvine.
Rose Ann Adams to Kevin Adams, love and affection, waters of Cow Creek.
Melvin L. Williams aka Melvin Lee Williams and Terry L. Williams to Timothy G. Freeman and Sherrie L. Freeman, $250,000, Trotting Ridge Road.
Walter R. Awad and B. Jodi Breaden to Steven Dwayne Mayse and Stephanie Lynn Mayse, $69,500, lot 26, West Lawn Addition, Cantrill Street.
Wells Fargo Bank N.A., Paul Geach and Lori Geach, County of Estill, Michael Dean, master commissioner sale to Wells Fargo Bank N.A., $63,700, 25 acres more or less, Fitchburg Road.
Sue Ann Brock nka Sue Ann Berry to Douglas A. Fry and Marlena Fry, $83,900, Red Lick Road.

matches: v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v. v.


text:
The data protection declaration of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. is based on the terms used by the European legislator for the adoption of the General Data Protection Regulation (GDPR). Our data protection declaration should be legible and understandable for the general public, as well as our customers and business partners. To ensure this, we would like to first explain the terminology used.
under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V.
The website of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. collects a series of general data and information when a data subject or automated system calls up the website. These general data and information are stored in the server log files. Collected may be (1) the browser types and versions used, (2) the operating system used by the accessing system, (3) the website from which an accessing system reaches our website (so-called referrers), (4) the sub-websites, (5) the date and time of access to the Internet site, (6) an Internet protocol address (IP address), (7) the Internet service provider of the accessing system, and (8) any other similar data and information that may be used in the event of attacks on our information technology systems.
When using these general data and information, the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. does not draw any conclusions about the data subject. Rather, this information is needed to (1) deliver the content of our website correctly, (2) optimize the content of our website as well as its advertisement, (3) ensure the long-term viability of our information technology systems and website technology, and (4) provide law enforcement authorities with the information necessary for criminal prosecution in case of a cyber-attack. Therefore, the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. analyzes anonymously collected data and information statistically, with the aim of increasing the data protection and data security of our enterprise, and to ensure an optimal level of protection for the personal data we process. The anonymous data of the server log files are stored separately from all personal data provided by a data subject.
If one of the aforementioned reasons applies, and a data subject wishes to request the erasure of personal data stored by the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V., he or she may, at any time, contact any employee of the controller. An employee of AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. shall promptly ensure that the erasure request is complied with immediately.
Where the controller has made personal data public and is obliged pursuant to Article 17(1) to erase the personal data, the controller, taking account of available technology and the cost of implementation, shall take reasonable steps, including technical measures, to inform other controllers processing the personal data that the data subject has requested erasure by such controllers of any links to, or copy or replication of, those personal data, as far as processing is not required. An employees of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. will arrange the necessary measures in individual cases.
If one of the aforementioned conditions is met, and a data subject wishes to request the restriction of the processing of personal data stored by the AG "Straße der deutschen Sprache" under the auspices of the Neuen Fruchtbringenden Gesellschaft e. V., he or she may at any time contact any employee of the controller. The employee of the AG "Straße der deutschen Sprache" under the auspices of the Neuen Fruchtbringenden Gesellschaft e. V. it will arrange the restriction of the processing.
In order to assert the right to data portability, the data subject may at any time contact any employee of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V..
The AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. shall no longer process the personal data in the event of the objection, unless we can demonstrate compelling legitimate grounds for the processing which override the interests, rights and freedoms of the data subject, or for the establishment, exercise or defence of legal claims.
If the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. processes personal data for direct marketing purposes, the data subject shall have the right to object at any time to processing of personal data concerning him or her for such marketing. This applies to profiling to the extent that it is related to such direct marketing. If the data subject objects to the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. to the processing for direct marketing purposes, the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. will no longer process the personal data for these purposes.
In addition, the data subject has the right, on grounds relating to his or her particular situation, to object to processing of personal data concerning him or her by the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. for scientific or historical research purposes, or for statistical purposes pursuant to Article 89(1) of the GDPR, unless the processing is necessary for the performance of a task carried out for reasons of public interest.
In order to exercise the right to object, the data subject may contact any employee of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V.. In addition, the data subject is free in the context of the use of information society services, and notwithstanding Directive 2002/58/EC, to use his or her right to object by automated means using technical specifications.
If the decision (1) is necessary for entering into, or the performance of, a contract between the data subject and a data controller, or (2) it is based on the data subject's explicit consent, the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V. shall implement suitable measures to safeguard the data subject's rights and freedoms and legitimate interests, at least the right to obtain human intervention on the part of the controller, to express his or her point of view and contest the decision.
If the data subject wishes to exercise the rights concerning automated individual decision-making, he or she may, at any time, contact any employee of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V..
If the data subject wishes to exercise the right to withdraw the consent, he or she may, at any time, contact any employee of the AG "Straße der deutschen Sprache" under the auspicies of the Neuen Fruchtbringenden Gesellschaft e. V..
On this website, the controller has integrated components of YouTube. YouTube is an Internet video portal that enables video publishers to set up video clips and other users free of charge, which also provides free viewing, review and commenting on them. YouTube allows you to publish all kinds of videos, so you can access both full movies and TV broadcasts, as well as music videos, trailers, and videos made by users via the Internet portal.

matches: V. V. V. V. V. V. V. V. V. V. V. V. V. V.


By Asher Lowenstein – Edited by Mengyi Wang Robert Bosch, LLC, v. Snap-On Inc., 2014-1040 (Fed. Cir. Oct. 14, 2014) Slip Opinion The Federal Circuit affirmed a district court decision that patent claims without reference to structure are indefinite under 35 U.S.C. § 112(f). The dispute involved Bosch’s patent—U.S. Patent No. 6,782,313 (“the ’313 patent”)—which claims “a diagnostic tester that determines whether the computerized control unit in a motor vehicle needs to be reprogrammed.” Slip op. at 2. Bosch sued Snap-On for infringing the ’313 patent, and Snap-on countered by arguing that the two claim terms “program loading device” and “program recognition device” are means-plus-function terms that fall within the purview § 112 and are indefinite. Id. at 4. The U.S. District Court for the Eastern District of Michigan agreed with Snap-on. Id. On appeal, while disagreeing with the district court that any use of the word “means” invokes § 112(f), id. at 7, the Federal Circuit affirmed that the patent claims were indefinite. Id. at 12. In patent applications, it is often easiest to describe an invention as something to be used as a means for a particular function. After the Supreme Court in Halliburton Oil Well Cementing Co. v. Walker found such descriptions invalid, § 112(f) was specifically added to allow these formulations with some limitations. 329 U.S. 1, 9 (1946) hosted by Justia.com. “Congress decided to permit broad means-plus-function language, but provided a standard to make the broad claim language more definite.” Valmont Indus., Inc. v. Reinke Mfg. Co., Inc., 983 F.2d 1039, 1042 (Fed. Cir. 1993) hosted by scholar.google.com. The limitations are that “[t]he applicant must describe in the patent specification some structure which performs the specified function,” and the court must relate the language to the corresponding structure. Id.The Federal Circuit refers to this as a “two-step process.” Slip op. at 4. First, the court determines whether the claim is drafted in a means-plus-function format, thus invoking § 112(f). Id. If the court concludes that the claim invokes § 112(f), it proceeds to the next step and attempts to construe the term by identifying corresponding structures. Id. at 5. With respect to Bosch’s claims, the court went through both steps using essentially the same analysis. Under the first step the court found that the patent’s specifications did “not contain a single reference to the structure,” id. at 9, and “provide no structural guidance . . . [and] are solely functional,” id. at 10. Therefore, the terms invoke § 112(f). Id. at 12. Proceeding to the second step, the court found it could not construe the terms by identifying corresponding structures because “as already discussed . . . the specification . . . offers no further guidance about their structures.” Id. This application of the two-step process suggests that there is really only one question: whether the claim terms refer to structural elements. It can be unclear whether a term is considered a structural or functional description. The court has found that a term such as “circuit” is a “structure-connoting term” for which § 112(f) presumptively does not apply. Linear Tech. Corp. v. Impala Linear Corp., 379 F.3d 1311, 1320 (Fed. Cir. 2004) hosted by scholar.google.com. Similarly, the court held that “modernizing device” is a term “connot[ing] sufficiently definite structure.” Inventio AG v. Thyssenkrupp Elevator Ams. Corp., 649 F.3d 1350, 1361 (Fed. Cir. 2011). In Bosch, however, the court held that “the claims involve ordinary functional terms, and there is no language . . . that defines the terms to refer to structures.” Slip. op. at 10–11. Patent filers have adapted terms used in claims to avoid invoking § 112(f). Patently-O observes that, whereas twenty years ago most claims used means-plus-function formulations, fewer than five percent do so now. Based on Bosch, Monday Morning Prosecutor suggests including examples of hardware components to make claims more definite. However, it may suffice simply to include a more technical term that could be seen as a “structure-connoting term” rather than a “solely functional” term. IP Blitz and Medical Device Patent Counsel feature further practical implications from the ruling.


text:
Complainant is F. Hoffmann-La Roche AG, Basel, of Switzerland, represented internally.
Respondent is Domain Admin/ Aditya Roshni/ Web Services Pty, New Delhi, Delhi of India.
The disputed domain name <prescriptionvalium.com> is registered with Domainclip Domains, Inc.
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on October 29, 2007. On October 31, 2007, the Center transmitted by email to Domainclip Domains, Inc. a request for registrar verification in connection with the domain name at issue. On November 8, 2007, Domainclip Domains, Inc. transmitted by email to the Center its verification response confirming that Respondent is listed as the registrant and providing the contact details. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).
In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified Respondent of the Complaint, and the proceedings commenced on November 15, 2007. In accordance with the Rules, paragraph 5(a), the due date for Response was December 5, 2007. Respondent did not submit any response. Accordingly, the Center notified Respondent’s default on December 11, 2007.
The Center appointed Sandra J. Franklin as the sole panelist in this matter on December 14, 2007. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.
Complainant is a well-known pharmaceutical company which markets a prescription sedative under the trademark VALIUM, the subject of International Registration No. R250784. Complainant has used the widely recognized mark VALIUM since 1961. Respondent registered the domain name <prescriptionvalium.com> on April 1, 2007.
1. Respondent’s <prescriptionvalium.com> domain name is confusingly similar to Complainant’s VALIUM mark.
2. Respondent does not have any rights or legitimate interests in the <prescriptionvalium.com> domain name.
3. Respondent registered and used the <prescriptionvalium.com> domain name in bad faith.
In view of Respondent’s failure to submit a response, the Panel shall decide this administrative proceeding on the basis of Complainant’s undisputed representations pursuant to paragraphs 5(e), 14(a) and 15(a) of the Rules and draw such inferences it considers appropriate pursuant to paragraph 14(b) of the Rules. The Panel is entitled to accept all reasonable allegations and inferences set forth in the Complaint as true unless the evidence is clearly contradictory. See Vertical Solutions Management, Inc. v. webnet-marketing, inc., FA 95095 (Nat. Arb. Forum July 31, 2000) (holding that the respondent’s failure to respond allows all reasonable inferences of fact in the allegations of the complaint to be deemed true); see also Talk City, Inc. v. Michael Robertson, WIPO Case No. D2000-0009 (February 29, 2000) (“In the absence of a response, it is appropriate to accept as true all allegations of the Complaint.”).
Complainant has established rights in the VALIUM mark by submitting proof of international registration of the mark, which satisfies Policy paragraph 4(a)(i). See Lockheed Martin Corporation v. Jeff Hoffman, FA 874152 (Nat. Arb. Forum January 31, 2007) (finding that the complainant had sufficiently established rights in the SKUNK WORKS mark through its registration with the USPTO); see also Trip Network Inc. dba Cheap Tickets, Inc. v. Sigfredo Alviera, FA 914943 (Nat. Arb. Forum Mar. 27, 2007) (finding that the complainant’s federal trademark registrations for the CHEAPTICKETS and CHEAPTICKETS.COM marks were adequate to establish its rights in the mark pursuant to Policy paragraph 4(a)(i)).
Respondent’s <prescriptionvalium.com> domain name is confusingly similar to Complainant’s mark. Respondent’s domain name contains Complainant’s entire VALIUM mark and adds the word “prescription”, which describes Complainant’s product, along with the generic top-level domain (“gTLD”) “.com”. The Panel finds these additions fail to distinguish Respondent’s domain name from Complainant’s mark in any meaningful way for purposes of Policy paragraph 4(a)(i). See F. Hoffman-La Roche AC v IT Developers s.c. Tomasz Kraus, Lukasz Haluch, WIPO Case No. D2006-1547 (January 26, 2007) stating “the affixing of the word ‘prescriptions’ – certainly in relation to VALIUM, which is a drug – is descriptive and does not take away the confusing similarity”; see also Trip Network Inc. dba Cheap Tickets, Inc. v. Sigfredo Alviera, FA 914943 (Nat. Arb. Forum March 27, 2007) (concluding that the addition of a gTLD, whether it be “.com”, “.net”, “.biz”, or “.org”, is irrelevant to a Policy paragraph 4(a)(i) analysis).
Complainant states that Respondent’s <prescriptionvalium.com> domain name simply points to a search engine composed of sponsored links. Once Complainant makes a prima facie case supporting its assertion that Respondent does not have rights or legitimate interests, the burden shifts to Respondent to show that it does have rights or legitimate interests in the disputed domain name. The Panel finds that Complainant has made a prima facie case pursuant to Policy paragraph 4(a)(ii). See Compagnie Generale des Matieres Nucleaires v. Greenpeace International, WIPO Case No. D2001-0376 (May 14, 2001) (“Proving that the Respondent has no rights or legitimate interests in respect of the Domain Name requires the Complainant to prove a negative. For the purposes of this sub paragraph, however, it is sufficient for the Complainant to show a prima facie case and the burden of proof is then shifted on to the shoulders of Respondent. In those circumstances, the common approach is for respondents to seek to bring themselves within one of the examples of paragraph 4(c) or put forward some other reason why they can fairly be said to have a relevant right or legitimate interests in respect of the domain name in question.”).
Because Respondent failed to answer the Complaint, the Panel presumes that Respondent lacks rights and legitimate interests in the disputed domain name. See America Online, Inc. v. AOL International, WIPO Case No. D2000-0654 (August 21, 2000) (finding no rights or legitimate interests where the respondent fails to respond); see also Pavillion Agency, Inc. Cliff Greenhouse and Keith Greenhouse v. Greenhouse Agency Ltd., and Glenn Greenhouse, WIPO Case No. D2000-1221 (December 4, 2000) (finding that the respondents’ failure to respond can be construed as an admission that they have no legitimate interest in the domain names). Despite Respondent’s failure to respond, the Panel will examine all evidence in the record to determine if Respondent has any rights or legitimate interests in the disputed domain name under Policy paragraph 4(c).
Complainant asserts that Respondent has never been authorized to use the VALIUM mark. Further, the Whois does not indicate that Respondent has ever been or is commonly known by the <prescriptionvalium.com> domain name. Therefore, the Panel finds that Respondent is not commonly known by the disputed domain name under Policy paragraph 4(c)(ii). See Tercent Inc. v. Lee Yi, FA 139720 (Nat. Arb. Forum February 10, 2003) (stating “nothing in Respondent’s WHOIS information implies that Respondent is ‘commonly known by’ the disputed domain name” as one factor in determining that Policy paragraph 4(c)(ii) does not apply); see also Gallup Inc. v. Amish Country Store, FA 96209 (Nat. Arb. Forum January 23, 2001) (finding that the respondent does not have rights in a domain name when the respondent is not known by the mark).
In addition, Respondent is using the disputed domain name to redirect traffic to a search engine with sponsored links. The Panel finds that in this case this is not a bona fide offering of goods and services under Policy paragraph 4(c)(i) or a legitimate noncommercial or fair use under Policy paragraph 4(c)(iii). See Golden Bear International, Inc. v. Kangdeock-ho, FA 190644 (Nat. Arb. Forum October 17, 2003) (“Respondent’s use of a domain name confusingly similar to Complainant’s mark to divert Internet users to websites unrelated to Complainant’s business does not represent a bona fide offering of goods or services under Policy � 4(c)(i) or a legitimate noncommercial or fair use under Policy � 4(c)(iii).”); see also Toronto-Dominion Bank v. Karpachev, 188 F.Supp.2d 110, 114 (D. Mass. 2002) (finding that, because the respondent’s sole purpose in selecting the domain names was to cause confusion with the complainant’s website and marks, its use of the names was not in connection with the offering of goods or services or any other fair use).
The Panel presumes that Respondent benefits commercially when Internet users click on the links featured on the website that resolves from the <prescriptionvalium.com> domain name. Respondent is therefore taking advantage of the likelihood that users will confuse the disputed domain name as being affiliated with Complainant and its VALIUM mark. This is evidence that Respondent registered and is using the <prescriptionvalium.com> domain name in bad faith pursuant to Policy paragraph 4(b)(iv). See American University v. Richard Cook, FA 208629 (Nat. Arb. Forum December 22, 2003) (“Registration and use of a domain name that incorporates another’s mark with the intent to deceive Internet users in regard to the source or affiliation of the domain name is evidence of bad faith.”); see also G.D. Searle & Co. v. Celebrex Drugstore, FA 123933 (Nat. Arb. Forum November 21, 2002) (finding that the respondent registered and used the domain name in bad faith pursuant to Policy paragraph 4(b)(iv) because the respondent was using the confusingly similar domain name to attract Internet users to its commercial website).
The Panel thus finds that Policy paragraph 4(a)(iii) has been satisfied.
For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name <prescriptionvalium.com> be transferred to Complainant.

matches: v. v. v. v. v. v. v. v. v. v. v. v. v. v.


text:
Gary Dankert's practice concentration is in construction law, including drafting and negotiating construction and design contracts, assisting on project delivery issues, including Public-Private Partnerships ("P3") Projects and handling construction disputes.
He has worked on a wide variety of large public and private projects, including Lucas Oil Stadium, the Indianapolis Mid-field Terminal, the Indiana Convention Center Expansion, Bankers Life Fieldhouse, the Ohio River Bridges Project, and the I-69, Section 5. He has served as general outside counsel to the Indiana Stadium and Convention Building Authority since its inception. Selected for inclusion in The Best Lawyers in America©, Dankert has spoken locally, statewide and nationally on employee benefit disputes and construction law.
An Indianapolis native, Gary received his Bachelor of Arts from Indiana University in 1974 and his juris doctor from Indiana University School of Law-Indianapolis in 1977. Gary joined Ice Miller in 1981. He is admitted to practice law in the state of Indiana.
Gary has been listed in The Best Lawyers in America©, and was recognized by Best Lawyers® as 2016 “Lawyer of the Year” for Construction Law and as 2017 “Lawyer of the Year” for Construction Litigation.
Huntington County Community School Corp. v. Indiana State Bd. Of Tax Com'rs, 757 N.E.2d 235, 158 Educ. L. Rep. 417 (Ind. Tax, 2001).
Fairfield Mfg. Co, Inc. v. Hartman, 132 F.Supp.2d 1142, 26 Employee Benefits Cas. 1471 (N.D. Ind., 2001).
Graber v. State Bd. Of Tax Com'rs, 727 N.E.2d 802, 143 Educ. L. Rep. 1016 (Ind. Tax, 2000).
Biomet, Inc. Health Ben. Plan v. Black, 51 F.Supp.2d 942 (N.D. Ind., 1999).
Lutheran Hospital v. Business Men's Assurance Co. of America, 51 F.3d 1308 (7th Cir. 1995).
Sallee v. Rexnord Corp., 985 F.2d 927, 16 Employee Benefits Cas. 1777 (7th Cir. 1993).
MacLauchlan v. Prudential Ins. Co. of America, 970 F.2d 357 (7th Cir. 1992).
Northern Indiana Public Service Co. v. East Chicago Sanitary Dist., 590 N.E.2d 1067 (Ind. App. 1992).
2/5/2018 - The Uniform Commercial Code: Does It Apply to Construction Contracts and Why Does It Matter?
11/2/2017 - When Do I Have a Contract?
He has also spoken at various meetings of industry trade groups including the American Institute of Architects and the Construction Specifications Institute.

matches: v. v. v. v. v. v. v. v.