The opinion of the court was delivered by: Irma E. Gonzalez, Chief Judge United States District Court
Order Denying Defendants Alejandro Canelos Rodriguez and Aristeso Alejandro Canelos Guillen's Motion to Dismiss Based upon Lack of Venue; Denying Motion to Dismiss for Improper Service of Process; Alternatively Quashing Service of and successor in interest to Process and Granting Plaintiff Time to Effect Proper Service
Defendants Alejandro Canelos Rodriguez and Aristeo Alejandro Canelos Guillen ("Defendants") move the Court to dismiss Plaintiff's complaint against them under Fed. R. Civ. P. 12(b)(3), based upon improper venue, and pursuant to Fed. R. Civ. P. 12(b)(5), based upon insufficient service of process. Plaintiff has filed an opposition and Defendants have filed a reply. The Court finds Defendants' motion suitable for submission on the papers and without oral argument pursuant to Civ. L.R. 7.1(d)(1), and the hearing was previously vacated. For the reasons set forth herein, Defendants' motion to dismiss for lack of venue is DENIED, and their motion to dismiss for improper service of process is DENIED. However, Plaintiff's service of process upon Defendants is quashed and Plaintiff is granted time to effect proper service upon Defendants.
Plaintiff Agricola ABC, S.A. de C.V., a Mexican corporation with its principal place of business located in Sinaloa, Mexico, operates a large farming business. [Complaint, ¶ 2.] At the time of the events which give rise to Plaintiff's complaint, Defendant Alejandro Canelos Rodriguez jointly managed Plaintiff Agricola along with his brother, Constantino Canelos Rodriguez. [Id., ¶ 7.] It appears from the papers that the extended Canelos family (including both Alejandro and Constantino) still own the Plaintiff company.
On December 14, 1998, Plaintiff Agricola and two other unnamed companies (collectively "the Producers") entered into a vegetable distribution agreement with Defendant Chiquita Frupac. [Complaint, ¶ 7.] In accordance with that agreement, the Producers received advances from Defendant Chiquita in an amount allegedly totaling $18,650,000. [Id., ¶ 8.] In order to guarantee repayment of the advances, the Producers (including Defendant Alejandro Canelos Rodriguez and his brother Constantino Canelos Rodriguez) created a Guarantee Trust on January 26, 1999. The purpose of the Guarantee Trust was to hold several parcels of real property in Mexico as security for the re-payment of the debt. [Id., ¶ 9.]
Thereafter, Plaintiff Agricola and the other Producers reached an agreement with Defendant Chiquita, to resolve the outstanding balance on the alleged debt from $18,650,000 to $5,000,000. [Complaint, ¶ 10.] Five parcels of land in San Diego County, totaling 100 acres and valued at more than $5,000,000, were transferred to Defendant Chiquita in full satisfaction of the loan. Plaintiff alleges, however, that Defendant Alejandro Canelos Rodriguez and Defendant Chiquita entered into a secret agreement whereby the properties in question were eventually transferred to entities associated with Defendant Alejandro Canelos Rodriguez, without consideration. [Id., ¶ 11.] Plaintiff further alleges Defendant Alejandro Canelos Rodriguez improperly caused one of the Canelos family companies to transfer title to another piece of real property in Mazatlan, Mexico, to Defendant Chiquita, for his own personal benefit and to the detriment of Plaintiff Agricola, the Producers, and the other Canelos family members. [Id., ¶ 12.]
Plaintiff alleges Defendant Chiquita has released Defendant Alejandro Canelos Rodriguez from all obligation under the debt, but has refused to provide such a release to Plaintiff. Defendant Chiquita has also refused to release the other parcels of land in Mexico still held in the Guarantee Trust. [Complaint, ¶ 13.]
Plaintiff invokes the diversity jurisdiction of this Court to bring its claims against Defendants. As to Defendant Chiquita, Plaintiff alleges breach of contract, and also seeks declaratory relief as to the status of the debt as well as an accounting. [Complaint, ¶¶ 15-30.] As to Defendants Alejandro Canelos Rodriguez and Aristeo Alejandro Canelos Guillen (Alejandro's son), Plaintiff brings a claim for equitable indemnity, arguing Defendants were co-obligors on the debt to Chiquita and asking for a ruling that these individual Defendants are obligated to indemnify Plaintiff and other co-obligors on a pro rata basis based upon their failure to contribute toward the repayment of the debt. [Id., ¶¶ 31-34.]
Only Defendants Alejandro Canelos Rodriguez and Aristeo Alejandro Canelos Guillen have brought the current motion. Defendant Chiquita has already filed an answer. An Early Neutral Evaluation Conference is set before Magistrate Judge Stormes on July 28.
Defendants Alejandro Canelos Rodriguez and Aristeo Alejandro Canelos Guillen move to dismiss the complaint under Fed. R. Civ. P. 12(b)(3), based upon improper venue. They also seek dismissal of the action under Fed. R. Civ. P. 12(b)(5) based upon insufficient service of process.*fn1
Pursuant to Fed. R. Civ. P. 12(b)(3), the Court may dismiss an action for improper venue.
In evaluating a motion to dismiss under Rule 12(b)(3), the district court need not accept the pleadings as true, and may consider facts outside the pleadings. Murphy v. Schneider Nat'l, Inc., 362 F.3d 1133, 1137 (9th Cir. 2004). Where there are disputed issues of fact, the court must ...