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Folex Golf Industries, Inc v. China Shipbuilding Industry

May 9, 2013

FOLEX GOLF INDUSTRIES, INC., PLAINTIFF,
v.
CHINA SHIPBUILDING INDUSTRY, CORPORATION, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Manuel L. Real United States District Judge

FINDINGS OF FACT & CONCLUSIONS OF LAW

Defendant's Motion for Summary Judgment was heard by the Court on March 18, 2013. The Court found in favor of Defendant O-Ta Precision Industries Co., Ltd. ("O-Ta" or "Defendant") and grantedDefendant's Motion. Defendant was ordered to prepare proposed findings of fact and conclusions of law, which Defendant provided to the Court on April 19, 2013. The Court has considered the proposed findings as well as the objections of Plaintiff Folex Golf Industries, Inc., ("Folex" or "Plaintiff"). In view of those objections, and in consideration of the evidence submitted by the parties on summary judgment, the Court issues the following findings of fact and conclusions of law.

Procedural History

1. Plaintiff initiated this action against Defendant on March 31, 2009. (Docket No. 1.) The operative First Amended Complaint ("FAC") was filed on June 26, 2009. (Docket No. 5.).

2. In addition to O-Ta two other parties were named as defendants in the First Amended Complaint: Luoyang Ship Material Research Institute ("LMSRI") and China Shipbuilding Industry Corporation ("China Shipbuilding"). Plaintiff alleges LMSRI is a subsidiary of China Shipbuilding. (FAC ¶ 5.)

3. Defendant moved for summary judgment on all of Plaintiff's claims on August 16, 2010. (Docket No. 53.) The Court granted Defendant's motion on October 4, 2010. (Docket No. 86.)

4. Plaintiff appealed the Court's ruling on summary judgment to the Ninth Circuit Court of Appeals. (Docket No. 90.) The appeal was limited to five of Plaintiff's twelve claims. (Id.)

5. The Ninth Circuit reversed this Court's ruling that the five claims were barred as a matter of law by the statute of limitations. (Docket No. 119.)

6. Following remand from the Ninth Circuit, Defendant again moved for summary judgment on grounds not previously been considered. (Docket No. 143.)

7. Defendant and Plaintiff fully briefed the relevant issues, and the Court heard oral argument on Defendant's motion for summary judgment on March 18, 2013. (Docket Nos. 143, 188, 200, 202.)

8. After full consideration of the evidence submitted by and argument of the parties, the Court granted Defendant's motion for summary judgment. (Docket No. 202.)

Findings of Fact

1. On November 23, 1996, SST Company of the United States ("SST") entered into an agency agreement with LSMRI ("1996 SST Agreement"). (Kesselman Decl., Exh. D.) Defendant O-Ta was not a party or signatory to the 1996 SST Agreement.

2. The 1996 SST Agreement provided that LSMRI agreed to pay SST a 6% - 10% commission on all sales made directly by LSMRI to customers introduced by SST. (Id.) LSMRI agreed to make payments to SST in a form designated by SST within five business days after LSMRI received payment from a customer. (Id.)

3. In addition to the 1996 SST Agreement, Folex Golf Industries, Inc., an assignee of SST, entered into another agency agreement with LSMRI ("1996 Folex Agreement"). (Kesselman Decl., Exh. F.) Defendant O-Ta was not a party or signatory to the 1996 Folex Agreement. (Id.) 4. The 1996 Folex Agreement provided that LSMRI agreed to pay Folex a 6% - 10% commission on all sales made directly by LSMRI to customers introduced by Folex. (Id.) LSMRI agreed that customers introduced by Folex would remit payment directly to Folex, which would then deduct its commission and remit the remaining balance to LSMRI. (Id.)

5. In February of 2000, Folex and LSMRI entered into an addendum to agency agreement ("2000 Addendum Agreement"). (Kesselman Decl., Exh. F.) Defendant O-Ta was not a party or signatory to the 2000 Addendum Agreement. (Id.)

6. Under the 2000 Addendum Agreement, O-TA could make purchases from suppliers other than LSMRI if, among other things, LSMRI's pricing was not competitive. (Id.)

7. Pursuant to paragraph 8 of the 2000 Addendum Agreement, Folex and LSMRI expressly agreed that either party "will have the right to pursue legal litigation in the United States or China ...


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