Thales Alenia Space France v. Thermo Funding Co.

959 F. Supp. 2d 459, 2013 WL 3199628, 2013 U.S. Dist. LEXIS 89297
District Court, S.D. New York·Decided June 25, 2013·No. No. 13 Civ. 712(SAS)·Published·Cited by 8 cases

Opinion

OPINION AND ORDER

SHIRA A. SCHEINDLIN, District Judge.

I. INTRODUCTION

Plaintiff Thales Alenia Space France (“Thales”) filed this action against Thermo Funding Company, LLC (“Thermo”) for an alleged breach of contract. Thermo moved to dismiss for failure to state a claim and lack of personal jurisdiction, arguing that Thales did not adequately plead the validity of the agreement between the parties (Thales alleges personal jurisdiction on the basis of the agreement’s forum-selection clause). Because Thales has plausibly alleged the existence of a binding contract between the parties, Thermo’s motion to dismiss under Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6) is denied.

II. FACTUAL BACKGROUND

This action arises from a series of contractual relationships between three entities. Thales is a French aerospace company involved in the manufacture of low Earth orbit (“LEO”) satellites.1 Globalstar, Inc. (“Globalstar”) is a provider of satellite voice and data services that operates LEO satellites.2 Thermo is a private equity firm that owns a controlling interest in Globalstar.3

A. The Parties’ Business Relationships

In late 2006, Globalstar contracted with Thales’s predecessor, Alcatel Alenia Space France, for the purchase of forty-eight new LEO satellites.4 These were to be Globalstar’s “second generation constellation of satellites.”5 In 2009, Globalstar and Thales executed a new agreement (the “Supply Agreement”) amending the pricing and other terms of the 2006 contract.6

In order to fund this arrangement, Globalstar arranged for financing from the Compagnie Francaise d’Assuranee pour le Commerce Exterieur (“COFACE”) — the [462] French export credit agency — and several French banks.7 As part of this agreement, Globalstar was required to fund a Debt Service Reserve Account (“DSRA”) of $12.5 million, and COFACE and the banks requested Thales to provide a guarantee of the full amount of the DSRA.8 Thales agreed, provided that Thermo reimburse Thales for any payments it makes under the guarantee.9 This arrangement between Thermo and Thales was memorialized in a separate 2009 contract (the “Reimbursement Agreement”), which provided that such reimbursements must be made by December 31, 2012, or within ten business days of a change in control of Globalstar.10 The Reimbursement Agreement also contained English choice-of-law and forum-selection provisions.11 Ultimately, Thales paid the maximum $12.5 million, thereby obligating Thermo to reimburse it for the same amount.12

B. The Thales-Globalstar Arbitration

In 2011, Globalstar initiated arbitral proceedings against Thales in relation to its obligations under the Supply Agreement, and Thales filed counterclaims against Globalstar.13 Thales prevailed in the arbitration, winning an approximately €52.7 million award on its counterclaims.14 Thales then initiated an action in this district to confirm and domesticate the award.15

Notwithstanding this dispute, Globalstar wished to continue its relationship with Thales and to purchase six additional satellites.16 To this end, Thales, Globalstar, and Thermo all entered into settlement discussions, which ultimately resulted in several 2012 agreements, including the “Settlement Agreement” and the “Release Agreement.”17 All three entities signed these agreements.18

The Release Agreement provided, in relevant part, that:

1......
(d) The terms “Claim” or “Claims” shall mean any and all claims, demands, actions, causes of action, obligations, rights and liabilities, of any nature whatsoever, and all associated damages ..., refunds, losses, profits, costs, arbitration costs and attorneys’ fees.
(e) The term “Released Claims” shall mean Claims ... whether or not now known or asserted, which any Party ever had, now has, or ever will have against another Party, including without limitation Claims relating to any of the facts known to the Parties, arising out of or in any way related to ... the Guarantee....
2......
(a) Upon the earlier of the [sic] (x) December 31, 2012 and (y) [another event], Thales hereby unconditionally and irrevocably releases and for[463] ever discharges Globalstar and Thermo from all Released Claims.... 19

The Settlement Agreement then provided that “[o]n the New Contract Effective Date or on December 31, 2012, whichever is earlier, Thermo shall pay to Thales $12,500,000 in relation to the DSRA, by wire transfer____”20 The Settlement Agreement also contained New York choice-of-law and forum-selection provisions.21

C. The Instant Action

According to the Complaint, “Thermo failed to pay Thales $12.5 million by December 31, 2012.”22 On January 31, 2013, Thales filed suit in this Court against Thermo to collect the funds allegedly due under the Settlement Agreement.23 In response, Thermo moved to dismiss for failure to state a claim and lack of personal jurisdiction.24 Thermo argues that its promises in the Settlement Agreement are unenforceable due to lack of consideration.25 Thermo claims that this is because the statements regarding the DSRA in the Settlement Agreement were mere reiterations of a preexisting promise to pay under the 2009 Reimbursement Agreement (and thus cannot be consideration from Thermo under the “preexisting duty rule”),26 and Thermo received no consideration at all from Thales.27

III. LEGAL STANDARD

A. Failure to State a Claim

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Thales Alenia Space France v. Thermo Funding Co., 959 F. Supp. 2d 459, 2013 WL 3199628, 2013 U.S. Dist. LEXIS 89297 (S.D.N.Y. 2013).

959 F. Supp. 2d 459 (Thales Alenia Space France v. Thermo Funding Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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