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Gulf Oil Limited Partnership v. Petroleum Marketing Group, Inc.

United States District Court, D. Massachusetts

March 30, 2018

GULF OIL LIMITED PARTNERSHIP, Plaintiff,
v.
PETROLEUM MARKETING GROUP, INC., and BP PRODUCTS NORTH AMERICA INC., Defendants.

          OPINION AND ORDER

          George A. O'Toole, Jr. United States District Judge

         Gulf Oil Limited Partnership (“Gulf”) alleges claims against BP Products North America (“BP”) for tortious interference with contract and advantageous business relations or business expectancy (Count VI); violation of Massachusetts General Laws Chapter 93A, § 11 (Count VII); conspiracy under Virginia Code § 18.2-499, et seq. (Count VIII); and civil conspiracy (Count IX).

         Now pending before the Court is BP's motion under Federal Rule of Civil Procedure 12(b)(2) to dismiss the claims for lack of personal jurisdiction.

         I. Factual Background

         Gulf, a Delaware limited partnership with a principal place of business in Massachusetts, is a wholesaler of refined petroleum products, including diesel fuel and gasoline. Gulf utilizes a distribution network that supplies fuel products through seventeen terminals and more than 1, 800 Gulf-branded gas and service stations. BP is incorporated in Maryland and has a principal place of business in Illinois. It operates BP gas stations in various States, including Massachusetts.

         In 2016, co-defendant Petroleum Marketing Group (“PMG”) acquired from Gulf 223 northeast and mid-Atlantic dealer-operated convenience stores and gas stations. PMG also entered into a Distributor Agreement with Gulf, pursuant to which PMG's newly acquired gas stations would continue to be branded with Gulf logos and Gulf would supply their fuel. The agreement detailed the parties' respective rights and responsibilities at length. Gulf and PMG are also parties to a number of other more or less related agreements that are apparently not germane to the present issues.

         In late 2016 and early 2017, Gulf became concerned that PMG might be planning to lease to BP some of the stations it had acquired from Gulf. The Oil Express, an industry periodical, reported in February 2017 that BP was engaged in conversations with PMG to acquire some of the latter's Gulf-branded stations. The complaint alleges that the Oil Express article was circulated throughout the country, including in Massachusetts. Gulf argues in its brief that BP “triggered multiple false rumors to circulate that BP [was] buying some of Gulf's most valuable stations and Gulf [was] exiting the market, ” (Gulf's Resp. in Opp'n to BP's Mot. to Dismiss, 2 (dkt. no. 41)), but there is no similar allegation in the complaint itself, nor are there any supporting factual allegations other than the quoted conclusory assertion set forth in the brief.

         By letter dated April 21, 2017, PMG advised Gulf that it had entered into an agreement with BP pursuant to which PMG would lease seventy-six Gulf-branded sites to BP and that BP intended to use them to sell BP branded fuels. Gulf became concerned both with the potential loss of revenue under the Distributor Agreement from the conversion of Gulf stations to BP stations and with the adverse public relations effect of what might be seen as a substantial withdrawal from the retail market by Gulf. The sites at issue are located exclusively in New York and New Jersey.

         The complaint alleges that BP, which had some knowledge of the ongoing business relationship between Gulf and PMG, [1] induced PMG to breach the Distributor Agreement and wrongfully colluded with PMG to convert stations from Gulf to BP stations. Gulf claims that it is losing millions of dollars as a result of BP's tortious interference.

         II. Standard of Review

         When a court's power to exercise personal jurisdiction over a defendant is challenged, the plaintiff bears the burden of establishing that the exercise of such jurisdiction is proper. A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 58 (1st Cir. 2016) (citing Phillips v. Prairie Eye Ctr., 530 F.3d 22, 26 (1st Cir. 2008)). Under the commonly used “prima facie” approach, a court considers “whether [Gulf] has proffered evidence which, if credited, is sufficient to support findings of all facts essential to personal jurisdiction.” Id. (quoting Phillips, 530 F.3d at 26). A court “must accept [Gulf's] properly documented evidentiary proffers as true and construe them in the light most favorable to [its] jurisdictional claim.” Id. (citing Phillips, 530 F.3d at 26). However, the plaintiff is only entitled to credit for assertions that are supported by specific evidence, not for conclusory or unsupported allegations from its pleadings. Id. (quoting Platten v. HG Berm. Exempted Ltd., 437 F.3d 118, 134 (1st Cir. 2006)). Allegations in legal memoranda alone are “insufficient . . . to establish jurisdictional facts.” Barrett v. Lombardi, 239 F.3d 23, 27 (1st Cir. 2001).

         III. Discussion

         The Due Process Clause of the Fourteenth Amendment to the United States Constitution limits the power of a State to subject nonresidents to binding adjudications by its courts. Bristol-Myers Squibb Co. v. Super. Ct. of Cal., 137 S.Ct. 1773, 1779 (2017); J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 879-80 (2011). However, a State may subject a nonresident to the judgments of its courts under circumstances where the nonresident's voluntary contacts with the State are such that the exercise of binding judicial power over a particular controversy would “not offend ‘traditional notions of fair play and substantial justice.'” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). In particular,

[w]here a defendant “purposely avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws, [Hanson v. Denckla, 357 U.S. 235, 253 (1958)], it submits to the judicial power of an otherwise foreign sovereign to the extent that power is exercised in connection with the defendant's activities touching on the State.

J. McIntyre, 564 U.S. at 881.

         In deciding whether a defendant may properly be subjected to personal jurisdiction in a given forum, a court must consider “a variety of interests, ” including “‘the interests of the forum State and of the plaintiff in proceeding with the cause in the plaintiff's forum of choice.'” Bristol-Myers Squibb, 137 S.Ct. at 1780 (quoting Kulko v. Super. Ct. of Cal., 436 U.S. 84, 92 (1978)). But the court's “‘primary concern' is ‘the burden on the defendant, '” id. (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292 (1980)), not only because there may be practical problems resulting from forcing a defendant to litigate in an inconvenient forum, but because the question of jurisdiction also implicates the “territorial limitations on the power of the respective States.” Id. (citing Hanson, 357 U.S. at 251). Each State has a ...


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