UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF NEW YORK 

------------------------------------------------------------X 

ZIM INTEGRATED SHIPPING SERVICES, LTD., 

 Plaintiff, 

 - against - 

BELCO RESOURCES, INC., SINOCHEM 

JIANGSU CORPORATION (FORMERLY KNOWN 

AS SINOCHEM JIANGSU IMPORT & EXPORT 

CORPORATION), NANJING HUABIN FOREIGN 

TRADE & ECONOMICS CO., LTD., 

DRAGONTRANS SHIPPING LTD. d/b/a 

HUABANG INTERNATIONAL, INC., 

SINOTRANS NINGBO INTERNATIONAL 

FORWARDING AGENCY CO., LTD., 

JOHN DOE 1-10, 

 Defendants. 

------------------------------------------------------------X 

Case No. 07-civ-5861 (RMB) 

MEMORANDUM OF LAW IN OPPOSITION TO 

DEFENDANTS SINOCHEM JIANGSU CORPORATION AND 

NANJING HUABIN FOREIGN TRADE & ECONOMICS CO., LTD.’S 

MOTION TO DISMISS WITH PREJUDICE COUNTS II THROUGH IX OF THE 

SECOND AMENDED COMPLAINT AND TO VACATE THE RULE B ATTACHMENT 

AND IN OPPOSITION TO DEFENDANT BELCO RESOURCES, INC.’S 

MOTION TO VACATE THE RULE B ATTACHMENT

DEORCHIS & PARTNERS, LLP 

Attorneys for Plaintiff 

61 Broadway, 26th Floor 

New York, New York 10006-2802 

(212) 344-4700 

Vincent M. De Orchis 

John A. Orzel 

William E. Lakis 

Olivier D. L. DuPont 

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TABLE OF CONTENTS

PRELIMINARY STATEMENT .....................................................................................................1 

STATEMENT OF FACTS ..............................................................................................................2 

ARGUMENT.......................................................................................................4 

POINT I PLAINTIFF’S COMPLAINT IS WELL PLED 

 AND SHOULD NOT BE DISMISSED ................................................................. 4 

 A. The Incorporated Documents Support the Pleadings...................................4 

 B. Plaintiff’s Allegations Are Sufficient To Withstand 

 a Motion To Dismiss....................................................................................6 

 C. Plaintiff Has Stated a Claim For Fraud........................................................7 

 D. Plaintiff Has Stated a Claim for Negligent Misrepresentation ..................12 

 E. Plaintiff Has Properly Stated Claims for Strict Product Liability, 

 Strict Liability for Failure to Warn, or Negligent Failure to Warn............13 

 F. Zim’s Claim For Breach of Warranty of Particulars Is Proper..................14 

 G. Zim’s Claim For Strict Liability Under COGSA Does Not Fail ...............15 

POINT II ZIM IS ENTITLED TO ITS CHOICE OF FORUM ABSENT A STRONG 

 SHOWING OF INCONVENIENCE BY DEFENDANTS .................................. 17 

 A. A Case-by-Case Analysis ..........................................................................18 

 1. Zim’s choice of forum should be given deference.........................18 

 

 2. China is not an adequate alternative forum....................................20 

 3. The Gilbert factors do not support dismissal .................................22 

 4. The Gilbert public interests favor retention of this matter.............23 

POINT III OPPOSITION TO DEFENDANT BELCO’S MOTION TO VACATE THE 

 RULE B ATTACHMENT PURSUANT TO RULE (E)(4)(f) ..............................24 

CONCLUSION............................................................................................................................. 26

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TABLE OF AUTHORITIES

Cases 

Aniero Concrete Co. v. New York City Construction Authority, 

 1997 U.S. Dist. LEXIS 22, at *37 (S.D.N.Y. 1997)............................................................... 11

Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd., 

 460 F.3d 434, 443 (2d Cir. 2006).......................................................................... 23, 24, 25, 26

Atlantic Overseas Corp. v. Feder, 

 452 F. Supp. 347 (S.D.N.Y. 1978).......................................................................................... 15 

Bigio v. The Coca Cola Co., 

 448 F.3d 176, 179 (2d. Cir. 2006) ...........................................................................................19

Cal. Dist. Inc. v. Cadburry Schweppes Americas Beverages, Inc., 

2007 WL 54534 (S.D.N.Y. 2007)............................................................................................. 5 

Carbotrade v. Bureau Veritas, 

 99 F.3d 86 (2d Cir. 1996) ......................................................................................................... 8 

Compania Sudamericana de Vapores S.A., v. Sinochem Tianjin Co., 

 2007 U.S. Dist. LEXIS 24737, *7 (S.D.N.Y. 2007) .........................................................16, 20

Concorde Funds, Inc. v. Value Line, Inc., 

 2006 U.S. Dist. LEXIS 18759, at *16, n.8 (S.D.N.Y. 2006) ..................................................12

Contship Containerlines, Ltd. v. PPG Industries, Inc., 

 443 F.3d 74 (2d Cir. 2006) ......................................................................................................17

Det Bergenske Dampskibsselskab v. Sabre Shipping Corp., 

 341 F.2d 50, 52-53 (2d Cir. 1965) ......................................................................................... 24

Erne Shipping, Inc. v. HBC Hamburg Bulk Carriers Gmbh &Co. Kg, 

 409 F, Supp. 2d 427 (S.D.N.Y., 2006) ................................................................................... 25

Eternity Global Master Fund Limited v. Morgan Guaranty Trust Co., 

 375 F. 3d 168, 187 (2d Cir. 2004) .......................................................................................... 11

Furlong v. The Long Island College Hospital 

 710 F.2d 922 (2d Cir. 1983) ......................................................................................................7

GJR Invs., Inc. v. County of Escambia, Fla., 

 132 F.3d 1359 (11th Cir. 1998) .................................................................................................7

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Gulf Oil Corp. v. Gilbert, 

 330 US. 501 (1974) .....................................................................................................18, 22, 23

Hellenic Lines, Ltd. v. Rhoditis, 

 398 U.S. 306, 308-09, 90 S. Ct. 1731, 26 L. Ed. 2d 252 (1970) .............................................. 7

Hoidas v. Orion & Global Chartering Co., 

 440 F. Supp. 53, 55 n.2 & n.3 (S.D.N.Y. 1977) .......................................................................9

Hydro Investors, Inc. v. Trafalgar Power, Inc., 

227 F.3d 8, 20 (2d Cir. 2000)...................................................................................................12 

In re M/V DG Harmony, 

 394 F. Supp. 2d 649 (S.D.N.Y. 2005)........................................................................... 5, 16, 17

In re. Ta Chi Navigation (Panama) Corp., 

462 F. Supp. 260, 267 (S.D.N.Y. 1978) ....................................................................................9 

International Audiotext Network, Inc. v. American Telephone and Telegraph Company, 

 F.3d 69 (2d Cir. 1995) ...............................................................................................................4

International Motor Sports Group, Inc. v. Gordon, 

 1999 U.S. Dist. LEXIS 12610 (S.D.N.Y. 1999)............................................................... 11, 12

Iragorri v. United Techs. Corp., 

 274 F.3d 65, 72 (2d Cir. 2001) ....................................................................................17, 18, 19

Koster v. Lumbermens Mut. Cas. Co., 

 330 U.S. 518 (1947) ................................................................................................................19

Lasala v. UBS, AG, 

 510 F. Supp. 2d 213, 222 ..................................................................................................21, 22

Lauritzen v. Larsen, 

 345 U.S. 571, 73 S. Ct. 921, 97 L. Ed. 1254 (1953)................................................................. 7

Leather’s Best, Inc. v. S.S. Mormaclynx, 

 451 F.2d 800 (2d Cir. 1971) ...................................................................................................15

Lora v.Perez, 

 2007 U.S. Dist. LEXIS 85887, *4 (S.D.N.Y., 2007).................................................................5 

Macleod v Cohen-Erichs Corp., 

 28 F Supp 103 (D.C.N.Y. 1939) ...............................................................................................6

Mattes v. Nat’l Hellenic American Line, S.A., 

427 F. Supp. 619, 623-24 (S.D.N.Y. 1977) .............................................................................. 9

Case 1:07-cv-05861-RMB-GWG Document 38 Filed 01/11/2008 Page 4 of 33
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Moncada v. Lemuria Shipping Corp., 

 491 F.2d 470, 472 (2d Cir. 1974) .............................................................................................9

Moore v. Guesno, 

 485 F. Supp. 2d 300, 309 (W.D.N.Y. 2007) .............................................................................7 

Morris Zweig v. National Mortgage Bank of Greece, 

 1993 US Dist. LEXIS 8460, *28 (S.D. N.Y. 1993).................................................................21

Norex Petro v. Access Industries, 

 416 F.3d 146, 153 (2d Cir. 2005) ............................................................................................18 

O’Brien v. Nat’l Prop. Anlysts Partners, 

 719 F. Supp. 222 (S.D.N.Y 1989)..............................................................................................5

Phillips Petroleum Co. v. Shutts, 

 472 U.S. 797, 845 (U.S. 1985).................................................................................................13

Piper Aircraft Co. v. Reyno, 

 454 U.S. 235, 255 n.22 (1981) ..........................................................................................18, 19

Polo Ralph Lauren L.P. v. Tropical Shipping & Construction Co., 

 215 F.3d 1217 (11th Cir. 2000) ..............................................................................................15

Pollux Holding Ltd. v. The Chase Manhattan Bank, 

 329 F. 3d 64, 73 (2d Cir. 2003) ...............................................................................................10

PT United Can Co. v. Crown Cork & Seal Co., 

138 F.3d 65, 74 (2d Cir. 1998)...................................................................................................... 21

Rationis Enters. Inc. of Panama v. Hyundai Mipo Dockyard Co., 

 426 F.3d 580 (2d Cir. 2005) ......................................................................................................8 

Reisman v. Medafrica Lines, USA, 

 592 F.Supp. 50 (S.D.N.Y. 1984)..............................................................................................12

Seawind Compania, S.A. v. Crescent Line, Inc., 

 320 F.2d 580, 582 (2d Cir. 1963) ..........................................................................................235

Senator Linie GMBH & Co. v. Sunway Line, Inc., 

 291 F.3d 145, 158 n. 17 (2d Cir. 2002) ...................................................................................16 

Sinochem International Co., Ltd., v. Malaysia Int’l Shipping Corp., 

127 S.Ct. 1184, 1190; 167 L.Ed.2d 15 (2007)(Not officially reported).......................23

Case 1:07-cv-05861-RMB-GWG Document 38 Filed 01/11/2008 Page 5 of 33
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Skibs A/S Gylfe v. Hyman-Michaels Co., 

 304 F. Supp. 1204, 1221 (E.D. Mich. 1969) ...........................................................................17

Sonito Shipping Co., Ltd. v. Sun United Mar., Ltd., 

 2007 U.S. Dist. LEXIS 19531, at *5, n.3 (S.D.N.Y. 2007) ....................................................14 

Sussman v. Bank of Israel, 

 801 F. Supp. 1068, 1076 (S.D.N.Y. 1992, aff’d, 990 F.2d 71 (2d Cir. 1993) ........................21 

Swierkiewicz v. Sorema, N.A., 

 534 U.S. 506, 152 L. Ed. 2d 1, 122 S. Ct. 992 (2002)...............................................................6

Texport Oil Co. v. M/V/ Amolyntos, 

 11 F.3d 361, 367 (2d Cir. 1993) ..............................................................................................15

Universidad de Las Californias v. Mayfair Advisors, Ltd., 

 2007 U.S. Dist. LEXIS 66351, *5 (S.D.N.Y., 2007) ................................................................5

Wynder v. McMahon, 

 360 F.3d 73 (2d Cir. 2004) ........................................................................................................6

Statutes 

46 U.S.C.§30701(3)(5)) ................................................................................................................14 

46 U.S.C.S. § 30701(4)(6) ............................................................................................................16

Other Authorities 

Hague Convention on the Carriage of Goods by Sea Act of 1924, as amended by the Brussels 

Protocol of 1968, Article 3(5) .......................................................................................................14 

Hague Convention on the Carriage of Goods by Sea Act of 1924, as amended by the Brussels 

Protocol of 1968, Article 4(6) .......................................................................................................16 

Treaty of Friendship, Commerce and Navigation, 5 U.S.T. 550, T.I.A.S. No. 2948 .................2, 9 

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PRELIMINARY STATEMENT

 Plaintiff Zim Integrated Shipping Services, Ltd. (“Zim”) respectfully submits this 

Memorandum of Law in opposition to the joint motion of Defendants Sinochem Jiangsu 

Corporation (“Sinochem”) and Nanjing Huabin Foreign Trade & Economics Co., Ltd. 

(“Huabin”) to dismiss Zim’s Second Verified Amended Complaint (“Complaint”) and to vacate 

the Rule B attachment, and a further motion by Defendant, Belco Resources, Inc. (“Belco”) to 

vacate the Rule B attachment. 

 Sinochem, through its agents, including Huabin, shipped a dangerous product, Calcium 

Hypochlorite (“Cal-Hypo”), declared as an innocuous substance, aboard plaintiff’s vessel. The 

Cal-Hypo exploded. Plaintiff’s vessel was severely damaged, and three seamen were injured. 

Owners of other cargoes, many going to the U.S., also suffered losses. 

 Sinochem and Huabin, only, have brought a Motion to Dismiss pursuant to Rule 12(b)(6) 

and on grounds of forum non conveniens. The motion should be denied. 

 The crux of Defendants’ 12(b)(6) motion is based on two alleged “contradictions” in 

Plaintiff’s pleadings, namely: the failure of Plaintiff to plead that the container of Cal-Hypo was 

transshipped from the M/V ZIM SAVANNAH to the M/V ZIM HAIFA; and the existence of a 

Certificate provided to Plaintiff at the time of the booking of the cargo which would suggest the 

chemical was Cal-Hypo. However, these so-called “contradictions” do not exist. Transshipment 

is customary practice in the maritime industry and is expressly provided for under the terms of 

the bill of lading. (See Curtin Decl. ¶ 14) . The transshipment had no role in the explosion. The 

name of the chemical on the Certificate is improper for shipping a hazardous product under the 

applicable international conventions. Most importantly, Defendants’ Certificate declared to Zim 

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that the product was non-flammable and non-oxidizing. In fact, Cal-Hypo is an oxidizing 

substance and may explode at low temperatures. 

 Defendants’ motion on grounds of forum non conveniens should also be dismissed. The 

overwhelming amount of evidence concerning causation and damages are located in the United 

States. Zim, as an Israeli company, is a beneficiary of the Treaty of Friendship, Commerce and 

Navigation between the United States and Israel under which it should be afforded “national 

treatment and most-favored-nation treatment with respect to access to the courts of justice”. 

Zim’s base of operations in respect to the vessel is in the United States. (Jones Decl. ¶¶ 6-39). 

The M/V ZIM HAIFA was en route to the ports of Savannah and New York to deliver containers 

which were damaged by Defendants’ Cal-Hypo. (Curtin Decl. ¶¶ 11, 12). Defendants placed a 

hazardous , chemical product into the stream of international commerce, causing damages to 

Plaintiff and U.S. cargoes interests. This Court has a strong public interest in protecting the 

injured parties, overwhelmingly located in the U.S., especially in light of recent well publicized 

events involving defective and dangerous goods shipped from China to the U.S. 

STATEMENT OF FACTS

 Cal-Hypo is a hazardous product under the International Convention for the Safety of 

Life at Sea (“SOLAS”) and is known to explode or ignite at low temperatures. (Compl. ¶¶ 15, 

16). Cal-Hypo is infamous in the maritime industry for causing extensive damage, including 

sinking vessels. (Compl. ¶17). As a result, Plaintiff Zim has refused to carry Cal-Hypo since 

2002. (Compl. id). 

 Cal-Hypo is responsible for causing a fire on June 3, 2007 aboard the M/V ZIM HAIFA, 

a vessel operated by Plaintiff, and for injuring three of its crew members on a voyage from the 

Far East to the East Coast of the United States. (Compl. ¶¶ 10, 11, 14). Cal-Hypo was loaded 

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aboard the M/V SAVANNAH at the port of Ningbo as indicated by the bill of lading. (Compl. 

Ex. A). The cargo was transshipped aboard the M/V HAIFA at a later port as more fully 

explained in this brief. Cal-Hypo exploded and caused extensive damages to the M/V ZIM 

HAIFA. (Compl. ¶ 18 and Ex. E). It also caused significant damages to other cargoes interests. 

(Compl. ¶ 18). Nine cargo interests, eight of which are located in the United States, are now 

claiming an amount exceeding $200,000.00 against Zim for losses resulting from the fire. 

(Willoughby Decl. ¶ 20). 

 Defendants misdescribed the cargo of Cal-Hypo as a harmless and non flammable 

substance, Calcium Chloride (“CC”), on the documents received for the booking of the cargo, 

namely the bill of lading, dock receipt and a document entitled Certification for Safe Transport 

of Chemical Goods (the “Certificate”). (Compl. ¶¶ 19, 30, 31 and Exs. A, B, C). Belco, a U.S. 

company, is the named shipper on the bill of lading. (Compl. ¶¶ 4, 22). Belco purchased CalHypo from Sinochem, a company involved in the export of chemicals located in Nanjing, China. 

(Compl. ¶¶ 24, 5). Sinochem arranged for the transportation of Cal-Hypo by hiring Huabin. 

(Compl. ¶ 26). Huabin then hired Huabang to book the shipment, who in turn contacted 

Sinotrans. (Compl. ¶¶ 27, 28). Sinotrans booked the shipment of Cal-Hypo with Plaintiff. 

(Compl. ¶ 28). 

 Belco had purchased 19 shipments of Cal-Hypo from Defendant Sinochem since 2004. 

(Compl. ¶ 34). Sinochem hired Huabin to arrange the transportation of each of these shipments. 

On 18 occasions, Cal-Hypo was declared on the bill of lading as substances other than Cal-Hypo. 

(Compl. ¶ 35, 36). Only one bill of lading reflected correctly the nature of the cargo. (Compl. ¶¶ 

37, 38). Zim believes that the cargo was intentionally misdeclared as CC by Sinochem, 

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individually or jointly with the other defendants, to avoid the restrictions by Zim on carrying 

Cal-Hypo. (Compl. ¶¶ 29, 38, 39). 

ARGUMENT

POINT I

PLAINTIFF’S COMPLAINT IS WELL PLED 

AND SHOULD NOT BE DISMISSED

A. The Incorporated Documents Support The Pleadings 

 Defendants’ first argument is that Zim did not allege in its complaint that container 

ZMU1037636 had been transferred from the M/V ZIM SAVANNAH to the M/V ZIM HAIFA. 

(Mot. Dis. page 8). But transfer of the container from one vessel to another did not contribute in 

any way to the cause of the explosion and fire. Even Defendants do not make that suggestion. 

Hence, it is an irrelevant fact for the pleadings. 

Transshipment of containers is not a mere possibility (See Mot. Dis. id.) but a common 

practice in the maritime industry. (Curtin Decl. ¶¶ 13, 14). This practice is expressly authorized 

under section 8 of the terms and conditions of Zim’s bill of lading. (Curtin Decl. ¶ 14). The bill 

of lading is incorporated by reference in Zim’s complaint. See International Audiotext Network, 

Inc. v. American Telephone and Telegraph Company, 62 F.3d 69, 75 (2d Cir. 1995) (documents 

incorporated by reference in a complaint may be taken into consideration). 

The container was loaded aboard the M/V ZIM SAVANNAH on May 4, 2007. (Curtin 

Decl. ¶¶ 6, 7). It was unloaded from the M/V ZIM SAVANNAH at the port of Shekou, in HongKong on May 6, 2007 for allocation reasons and loaded aboard the M/V ZIM HAIFA on May 

16, 2007. (Curtin Decl. ¶¶ 8, 10). The complaint alleges that the fire broke out aboard the M/V 

ZIM HAIFA which is true. (Compl. ¶¶ 10, 12 and Exs.A &C). There are, therefore, no 

contradictions in Plaintiff’s pleadings. 

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A court “must accept the factual allegations of the complaint as true and must draw all 

reasonable inference in favor of the plaintiff.” Lora v. Perez, 2007 U.S. Dist. LEXIS 85887, *4 

(S.D.N.Y., 2007); Universidad de Las Californias v. Mayfair Advisors, Ltd., 2007 U.S. Dist. 

LEXIS 66351, *5 (S.D.N.Y., 2007). This Court can infer that the container ZMU1037636 was 

transferred from the M/V SAVANNAH to the M/V HAIFA as a result of a regular 

transshipment arrangement. (Mot. Dis. page 8). Cases cited by defendants are inapposite: Cal. 

Dist. Inc. v. Cadburry Schweppes Americas Beverages, Inc., 2007 WL 54534, at *6 (parole 

evidence rule bars introduction of new evidence when the contract contains an integration 

clause). O’Brien v, Nat’l Prop. Analysts Partners, 719 F. Supp. 222, 229 (S.D.N.Y 1989) (no 

statement of accompanying facts was provided in the complaint in a RICO claim). 

The Defendants argue that their Certificate indicated on its face the hazardous nature of 

the cargo, and therefore Plaintiff knew of the contents of the container. (Mot. Dis. pages 8-9). 

Defendants claim that the name of the product on the Certificate, “CALCIUM (OXY) 

CHLORIDE,” is synonymous with Cal-Hypo. However, only the International Maritime 

Dangerous Goods Code (the “IMDG Code”) applies to the transportation of hazardous materials 

for shipments in international waters, to the exclusion of any other hazardous regulations. (Duffy 

Decl. ¶¶ 7, 9). A shipper cannot declare a dangerous substance by any other name than the 

‘Proper Shipping Names,’ as defined by the IMDG Code. (Duffy Decl. ¶¶ 13, 15). Technical 

names, trade names, product names, shortcut names, or business names are not permitted as a 

substitute by IMDG Code. (Duffy Decl. ¶ 15). “Calcium Chloride”, “Hypochlorite Salt” and 

“Calcium(oxy) Chloride” are not Proper Shipping Names of Cal-Hypo under the IMDG Code. 

(Duffy Decl. ¶ 17 and Qian Decl. ¶13). See In re M/V DG Harmony, 394 F. Supp. 2d 649, 660-

61, 672 (S.D.N.Y. 2005) (holding that identifying the cargo as “CALCIUM HYPOCHLORITE 

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HYDRATED CLASS 5.1 UN 2880 PACKING GROUP II IMDG PG” was insufficient to 

establish that the vessel owner consented to transport Cal-Hypo with full knowledge of the 

associated risks). 

Defendants’ Certificate clearly states that the substance analyzed is “not hazardous,” that 

the substance is “not flammable” and does “not” belong to oxidizing substances. However, CalHypo is a Class 5.1 (oxidizing substance) hazardous product which may lead to fire and 

explosion under the IMDG Code. (Duffy Decl. ¶¶ 11, 12, 18). Therefore, the Defendants must 

concede that if their Certificate in fact refers to Cal-Hypo, then their Certificate is false and 

erroneous as to the dangerous nature of the cargo. 

B. Plaintiff’s Allegations Are Sufficient To Withstand a Motion To Dismiss 

 Sinochem and Huabin contend that Zim failed to allege any wrongdoing on their part, 

other than by conclusory allegations. According to Defendants, Zim’s allegations of wrongdoing 

by Huabin and Sinochem, such as “Sinochem Jiangsu, through its agents Huabin, Huabang and 

Sinotrans,” (Compl. ¶¶ 30, 31) are insufficient. However, the pleadings requirement under Fed. 

R. Civ. P. 8(a) is a very permissive one. Swierkiewicz v. Sorema N.A., 534 U.S. 506, 152 L. Ed. 

2d 1, 122 S. Ct. 992 (2002) (Rule 8(a)(2) provides (a) that a complaint must include only "a short 

and plain statement of the claim showing that the pleader is entitled to relief," and (b) that such a 

statement simply "give the defendant fair notice of what the plaintiff's claim is and the grounds 

upon which it rests"); Wynder v. McMahon, 360 F.3d 73, 77 (2d Cir. 2004). Allegations in 

pleadings based on conclusions rather than facts are sufficient. See Macleod v Cohen-Erichs 

Corp., 28 F. Supp. 103 (1939, D.C.N.Y.). Here, the complaint alleges that Sinochem committed 

wrongdoing “through its agents Huabin, Huabang and Sinotrans”. This is a short and plain 

statement of an alleged relationship between the different defendants, sufficient not only under 

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Rule 8(a), but also under Rule 9(b) as further discussed. Therefore, Defendants’ argument is 

without basis. 

Defendants’ citations are inappropriate. In Moore v. Guesno, 485 F. Supp. 2d 300, 309 

(W.D.N.Y. 2007), the court dismissed under the heightened standard of pleading of Rule 9(b) 

plaintiff’s RICO claim. In GJR Invs., Inc. v. County of Escambia, Fla., 132 F.3d 1359 (11th Cir. 

1998), a claim for constitutional rights was drafted in a way that made it impossible to determine 

which factual allegations were relevant to which claim. Such is of course not the case here. 

Finally, in Furlong v. The Long Island College Hospital, the plaintiff had not pled the existence 

of an agreement which was required under the Sherman Act. 710 F.2d 922 at 927 (2d Cir. 1983). 

 Lastly, Huabin makes the argument that it “was hired in this case as export agent” and 

that it “correctly identified the chemical” as “Hypochlorite Salt” pursuant to Chinese law. (See

Mot. Dism. page 14). (Dagang Decl. ¶5 and Ex. A). However, under Chinese law, a shipper 

cannot declare Cal-Hypo as “Hypochlorite Salt”. (Qian Decl. ¶¶ 28-31). 

C. Plaintiff Has Stated a Claim for Fraud 

 Sinochem and Huabin allege that Chinese law should govern the fraud claim by Zim. 

However, they fail to properly apply the eight-factor Lauritzen federal choice-of-law test to 

determine the applicable law in maritime torts: (1) the place of the wrongful act; (2) the law of 

the flag; (3) the allegiance or domicile of the injured party; (4) the allegiance of the defendant 

shipowner; (5) the place where the contract was made; (6) the inaccessibility of a foreign forum; 

(7) the law of the forum; and (8) the shipowner’s base of operations. See Lauritzen v. Larsen, 

345 U.S. 571, 73 S. Ct. 921, 97 L. Ed. 1254 (1953); Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 

306, 308-09, 90 S. Ct. 1731, 26 L. Ed. 2d 252 (1970). The fourth, fifth and sixth factors are 

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generally omitted from a Lauritzen analysis as irrelevant. Carbotrade, 99 F.3d at 91; Rationis, 

426 F.3d 580, 587 (2d Cir. 2005). 

Only the first factor, the place of the wrong, points to the application of Chinese law, but 

only for purposes of determination of the law with respect to the causes of action for negligent 

misrepresentation and fraud. 

The second factor, “law of the flag,” is Liberia. 

However, the third, seventh and eighth factors weigh in favor of the application of U.S. 

law. Case law under the third Lauritzen factor has expanded the “domicile factors” to include 

the domicile of all parties involved, including cargo interests. See Carbotrade, 99 F.3d at 91; 

Rationis, 426 F.3d at 587-88. The injured parties include not only Zim, but also the cargo 

interests which have suffered damages as a result of the fire and which are the defendants in the 

second related matter pending before this Court (07-cv-6500). Eight out of nine cargo interests 

who have made a claim against Plaintiff are domiciled in the United States. (See Willoughby 

Decl. ¶¶ 5-10). Belco is also domiciled in the United States. Sinochem and Huabin are 

domiciled in China. (Willoughby Decl. ¶¶ 7-8). Nine parties out of thirteen are domiciled in the 

United States. Furthermore, unlike in Rationis, where the citizenship of the injured parties’ 

factor was complicated by incomplete discovery, there are no such discovery issues in this case 

and a vast majority of the cargo interests are U.S. citizens. (Willoughby Decl. ¶¶ 5-10); see 

Rationis, 426 F.3d at 587-88. 

The seventh Lauritzen factor, the law of the forum, also dictates that U.S. law apply. As 

Defendants have conceded, China does not recognize the causes of action for Strict Products 

Liability, Strict Liability for Failure to Warn and Negligent Failure to Warn, all of which 

Plaintiff Zim has pled in its Complaint. (Qian Decl. ¶¶ 37,38). Zim is entitled to obtain “national 

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treatment” and receive the benefit of access to U.S. Courts and U.S. laws under the Treaty of 

Friendship, Commerce and Navigation between the United States and Israel of 1954. 5 U.S.T. 

550, T.I.A.S. No. 2948. 

The eighth Lauritzen factor, the base of operations of all parties, is a determinative factor.

See Rationis, 426 F.3d 586; Carbotrade, 99 F.3d at 91. In this case, the “base of operations” 

factor alone is substantial enough to allow for the application of American law. The term “base 

of operations” refers to the place where the vessel is actively managed and directed. See In re. Ta 

Chi Navigation, 462 F. Supp. 260 at 264-651; Moncada, 491 F.2d at 472-73. Mattes v. Nat’l 

Hellenic American Line, S.A., 427 F. Supp. 619, 624-28 (S.D.N.Y. 1977) (well-entrenched and 

successful business presence of the vessel and its corporate superstructure “substantial” to 

establish base of operations); Hoidas v. Orion & Global Chartering Co., 440 F. Supp. 53, 55 n.2 

& n.3 (S.D.N.Y. 1977) (shipowner’s agents conferred jurisdiction through agency activities). 

 Furthermore, Zim is an entity incorporated under the laws of Israel and, as such, is a 

beneficiary of the Treaty of Friendship, Commerce and Navigation between the United States 

and Israel which entered into force in 1954. Article V1 of such treaty provides that: 

Nationals and companies of either Party shall be accorded national 

treatment and most-favored-nation treatment with respect to access 

to the courts of justice and to administrative tribunals and agencies 

within the territories of the other Party, in all degrees of 

jurisdiction, both in pursuit and in defense of their rights. It is 

understood that companies of either Party not engaged in activities 

within the territories of the other Party shall enjoy such access 

therein without any requirement of registration or domestication. 

 

1

 The court in Ta Chi Navigation held that courts may consider the location of the managing 

agents, the nationality of the corporate officers, the percentage of the vessel’s voyages beginning 

in American ports, the extent of advertising or other commercial transactions, and the place 

where the vessel’s earnings were collected and its expenses paid. The court also held that 

agency powers such as scheduling, booking, accounting, rate fixing, cargo solicitation, arranging 

repairs and overhauls, allocating tonnage, and collecting revenues are all additional factors used 

to determine a shipowner’s “base of operations”.

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10

5 U.S.T. 550, T.I.A.S. No. 2948. (emphasis supplied). This provision expressly confers to Zim 

“national treatment” in access to U.S. courts, and the Court of Appeals for the Second Circuit has 

given full effect to similar provisions. See Pollux Holding, Ltd. v. The Chase Mahattan Bank, 

329 F.3d 64 (2d Cir. 2003). The US-Israeli treaty affords Plaintiff a choice of the US forum with 

the same deference as it would afford to a US citizen. 

Furthermore, Zim’s subsidiary and regional agent, Zim American Integrated Services 

Limited (“Zim American”), is domiciled in Norfolk, Virginia. (Jones Decl. ¶¶ 3,5). Zim 

American issues direct orders and instructions regarding the management, operation, and control 

of Zim’s ships in North America, the Caribbean and Central America waters. (Jones Decl. ¶¶ 9-

20, 24-26). Zim American’s actions includes booking cargo, negotiating contracts and rates, 

planning stowage, collecting freight monies, and “all of the operations related to the Americas 

necessary to import or export cargoes on Zim’s vessels.” (Jones Decl. ¶¶ 9-20, 25-27). Zim 

American also took supervision over the M/V ZIM HAIFA immediately after the fire broke out. 

(Jones Decl. ¶¶ 21-35). Zim American, as Zim’s managing agent, exercised sufficient control to 

establish that Zim’s base of operations is in the United States. Therefore, the correct Lauritzen 

choice-of-law for all Plaintiff’s causes of action is the United States. 

 Huabin and Sinochem argue that Plaintiff cannot assert the element of causation under 

Chinese law necessary for claims of fraud because their cargo was placed aboard the M/V ZIM 

SAVANNAH, which had “nothing to do with the fire on the ZIM HAIFA.” (See Mot. Dism. p. 

12.) As previously discussed, this argument ignores the fact that Defendant’s container was 

aboard the M/V ZIM HAIFA and determined to be the center of the explosion and fire. See

discussion supra Part 1.A. Even if Chinese law applied, which it does not, the transshipment of 

the container would not be an issue of causation. (Qian Decl. ¶ 39). The Defendants also 

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11

contend that Plaintiff knew of the nature of the cargo. As discussed above, this argument is 

baseless. See infra at Point 1.A. 

Huabin and Sinochem also argue that Plaintiff has failed to plead with sufficient 

particularity a claim for fraud, except in respect to Sinotrans. Defendants also argue that Zim 

does not identify any specific wrongdoer. (See Mot. Dism. page 13). However, Plaintiff only 

needs to properly plead the elements of fraud as to one agent, in order to impute fraud to the 

principal. See Aniero Concrete Co. v. New York City Construction Authority, 1997 U.S. Dist. 

LEXIS 22, at *37 (S.D.N.Y. 1997) (the fraudulent statements of an agent, when made within the 

scope of its agency, are attributable to the principal). Here, Plaintiff pled that Sinotrans was hired 

as agent of Huabang, who in turn was the agent or subagent of Huabin and Sinochem. (Compl. 

¶¶ 26-29). The complaint alleges that Sinotrans placed the booking of the hazardous cargo with 

Plaintiff. (Compl. ¶ 28). The documents attached to the complaint, which include the bill of 

lading, dock receipt and Certificate, provide the basis for fraudulent statements and omissions by 

the Defendants. (Compl. ¶ 30 and Exs. A, B and C). 

Plaintiff’s Complaint further alleges that Belco, Huabin and Sinochem have been 

involved in 18 prior misdeclared shipments of Cal-Hypo “to save money on the cost of 

transportation”, as Cal-Hypo has “to be transported in refrigerated containers.”(Compl.¶¶ 34-38). 

Therefore, all the requirements under Rule 9(b) have been adequately pled. Eternity 

Global Master Fund Limited v. Morgan Guaranty Trust Co., 375 F. 3d 168, 187 (2d Cir. 2004) 

(under Rule 9(b), plaintiff is required to plead for a claim for fraud a) detail alleged fraudulent 

statements or omissions, b) identify the speaker, c) state where and when the statements (or 

omissions) were made, and d) explain why the statements (or omissions) were fraudulent); see 

also International Motor Sports Group, Inc. v. Gordon, 1999 U.S. Dist. LEXIS 12610 * 9-10 

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12

*10-11 and *12-13 (S.D.N.Y. 1999) (in analyzing sufficiency under Rule 9(b), the court must 

balance the rule with both Fed. R. Civ. P. 8(a) and 8(f), so that “a plaintiff need not plead dates, 

times, and places with absolute precision, so long as the complaint gives fair and reasonable 

notice to defendants of the claim and the grounds upon which it is based.”) (emphasis added). 

Alternatively, even if Plaintiff’s complaint is insufficient under the Rule 9(b) particularity 

requirement, the complaint falls under the Rule 9(b) exception: plaintiff may “base its allegations 

on information and belief when ‘the facts upon which plaintiff bases its fraud claim are 

peculiarly within the defendant’s knowledge”. Concorde Funds, Inc. v. Value Line, Inc., 2006 

U.S. Dist. LEXIS 18759, at *16, n.8 (S.D.N.Y. 2006) (citations omitted). Sinochem and its 

agents were the only parties aware of the true contents of the sealed container. Therefore, the 

Plaintiff has sufficiently pled a claim for fraud. 

D. Plaintiff Has Stated a Claim for Negligent Misrepresentation 

 The Plaintiff has appropriately pled a “regular” cause of action for negligent 

misrepresentation.2

 As indicated in the previous section, Plaintiff need only plead the cause of 

action against the agent in order to impute the wrongful act to the principal. See Reisman v. 

Medafrica Lines, USA, 592 F. Supp. 50 (S.D.N.Y. 1984) (shipper held liable for 

misrepresentations made by freight forwarder as “agent of the shipper”). 

 

2

 See Hydro Investors, Inc. v. Trafalgar Power, Inc., 227 F.3d 8, 20 (2d Cir. 2000) (Under New 

York law, the elements for a negligent misrepresentation claim are that (1) the defendant had a 

duty, as a result of a special relationship, to give correct information; (2) the defendant made a 

false representation that he or she should have known was incorrect; (3) the information supplied 

in the representation was known by the defendant to be desired by the plaintiff for a serious 

purpose; (4) the plaintiff intended to rely and act upon it; and (5) the plaintiff reasonably relied 

on it to his or her detriment). 

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13

 Defendants’ reference to a cause of action for negligent misrepresentation by “imparting 

words” (see Mot. Dis. page 14, fns. 6 and 7) should be disregarded, as Plaintiff did not plead 

such cause of action. 

E. Plaintiff Has Properly Stated Claims for Strict Product Liability, Strict Liability 

 for Failure to Warn, or Negligent Failure to Warn 

 The choice of law analysis requires the application of U.S. law. However, the “wrongful 

act” factor in the Lauritzen analysis has a different meaning for strict liability than for negligence 

or fraud. There is no negligent act to prove in strict liability. Therefore, the place of the 

“wrongful act” should be abandoned in favor of the “place of the injury,” because there is a 

greater interest in protecting the injured parties. The law of the place of the injury is the U.S. 

where most cargoes interests reside. 

 If Chinese law were to apply, Plaintiff concurs with Sinochem and Huabin that it would 

be denied all three causes of action for strict product liability, strict liability for failure to warn 

and negligent failure to warn. (Qian Decl. ¶¶ 37, 38, 40). (See Mot. Dism. pages 16). However, 

the denial of relief as a result of the determination of the foreign law would be “fundamentally 

unfair” as to violate the Due Process Clause of the U.S. Constitution. See Phillips Petroleum Co. 

v. Shutts, 472 U.S. 797, 845 (1985) (“it is nevertheless possible for a State’s choice of law to 

violate the Constitution because it is so ‘totally arbitrary or... fundamentally unfair’ to a litigant 

that it violates the Due Process Clause”). It is also within the discretion of the Court to award 

Plaintiff “such other and further relief as the Court may deem just and equitable”. In these 

extreme circumstances where the foreign law offers no relief, the law of the forum --one of the 

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14

factors in the Lauritzen analysis, should be given substantial weight so to avoid injustice and 

unfairness. U.S. law should therefore apply.3

F. Zim’s Claim For Breach of Warranty of Particulars Is Proper 

 Defendants argue that COGSA does not apply because the contract of carriage does not 

provide for the carriage of goods to or from ports of the United States. However, Defendants 

miss the point. First, Plaintiff pled a cause of action for breach of the warranty of particulars 

provided under international conventions. (Compl. ¶54). Second, Plaintiff does not contest that 

COGSA is not the law applicable to the contract of carriage. Zim’s bill of lading states that the 

cargo was being shipped from Ningbo, China to Belize City, Belize. (Compl. Ex. D). As a 

consequence, the applicable law of the contract of carriage pursuant to paragraph 24(a) of Zim’s 

Bill of Lading is the law of the State of Israel. See Zim’s Bill of Lading, Section 24(a). (Curtin 

Decl., Ex. A). 

However, Israel is a signatory of the Hague Convention on the Carriage of Goods by Sea 

Act of 1924, as amended by the Brussels Protocol of 1968 (the “Hague-Visby Rules”). The 

provision of the Hague-Visby Rules on the warranty of particulars, Article 3(5), is identical to 

the provision of the warranty of particulars under COGSA, 46 U.S.C. §30701(3)(5). (DuPont 

Decl. Ex. I). 

COGSA “represents that enactment by Congress into domestic law of the principles 

governing the carriage of goods by sea contained in the Hague Rules, adopted as an international 

convention.” Sonito Shipping Co., Ltd. v. Sun United Mar., Ltd., 2007 U.S. Dist. LEXIS 19531, 

 

3

Sinochem and Huabin argue that the claim for strict liability under U.S. law would be 

unavailing because Plaintiff must establish that the defect resulted in injury to the plaintiff and 

that it cannot because of the transshipment issue. See above Section I.A. and Plaintiff’s response 

establishing that transshipment is a customary practice and in any event is irrelevant to the issue 

of causation. See also Qian Decl. ¶ 39. 

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at *5, n.3 (S.D.N.Y. 2007). Therefore, Zim properly set forth the legal requirements of its cause 

of action for breach of warranty of particulars under the Hague-Visby Rules, the applicable law, 

because they are the same requirements as under COGSA. 

 Moreover, Zim properly pled the breach of warranty of particulars as against all 

Defendants, not just the named shipper in the bill of lading. The Second Circuit has held that 

claims brought under COGSA –which in the case of the warranty of particulars is identical to the 

Hague-Visby Rules – may be a “mixed tort, contract, and bailment cause of action.” Texport Oil 

Co. v. M/V Amolyntos, 11 F.3d 361, 367 (2d Cir. 1993). See also Polo Ralph Lauren L.P. v. 

Tropical Shipping & Construction Co., 215 F.3d 1217 (11th Cir. 2000) (COGSA affords one 

cause of action for lost or damaged goods which, depending on the underlying circumstances, 

may sound in either contract or tort). 

Although imputing liability to the shipper’s agent is not allowed under a contract theory, 

it is valid under a tort theory. See Leather’s Best, Inc. v. S.S. Mormaclynx, 451 F.2d 800 (2d Cir. 

1971); Atlantic Overseas Corp. v. Feder, 452 F. Supp. 347 (S.D.N.Y. 1978). By examining the 

interrelationship among the Defendants with respect to shipping the subject cargo, this Court will 

find that all Defendants in this matter are liable under a negligence theory for misdeclaring the 

cargo and breaching the warranty of particulars under Article 3(5) of the Hague-Visby Rules. 

G. Zim’s Claim For Strict Liability Under COGSA Does Not Fail 

For the reasons discussed in the previous section, Zim’s claim for strict liability is 

properly alleged. The laws of the State of Israel govern the contract of carriage and Israel is a 

signatory to the Hague-Visby Rules. Looking to Zim’s complaint, while the heading specifically 

mentions “strict liability under COGSA § 1304(6),” plaintiff has also pled strict liability “under 

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international conventions, and codified in the United States under 46 U.S.C. § 1304(6)” and 

“under similar applicable international conventions.” (Compl. ¶¶ 59, 61). 

The language of the applicable sections under COGSA and the Hague-Visby Rules 

regarding strict liability is identical. Compare 46 U.S.C.S. § 30701 (4) (6) and Article (4) (6) of 

the Hague-Visby Rules. See also Senator Linie GMBH & Co. v. Sunway Line, Inc., 291 F.3d 

145, 153 n. 7, 154, 170 n.40 (2d Cir. 2002) (the language of COGSA § 1304(6) “derives” from 

Article 4(6) of the Hague-Visby Rules, and discussing the “international uniformity” of COGSA 

interpretation is desirable”). Therefore, there is no reason to believe that a District Court would 

apply differently the provisions for strict liability under COGSA § 1304(6) than under Article 

4(6) of the Hague-Visby Rules. 

Compania Sudamericana de Vapores S.A., v. Sinochem Tianjin Co., 2007 U.S. Dist. 

LEXIS 24737, *7 (S.D.N.Y. Apr. 4, 2007) (quoting Senator Linie GMBH & Co. v. Sunway Line, 

Inc., 291 F.3d 145, at 166, 169 (2d Cir. 2002)). The shipper is responsible for the consequences 

of shipping dangerous goods, regardless of whether or not he was aware of the dangerous nature 

of the goods. His “only defense is that the carrier knew or should have known of their dangerous 

nature.” Senator Linie GMBH & Co., id. at 154. 

In Compania Sudamericana de Vapores, Judge Pauley held that a shipment of Cal-Hypo 

by Sinochem was a “dangerous and hazardous” substance triggering the application of strict 

liability analysis under COGSA. 2007 U.S. Dist. LEXIS 24737, *8. In that case, Siochem also 

failed to properly describe the cargo of Cal-Hypo in the bill of lading as required under the 

IMDG code. See also In re M/V DG Harmony, 394 F. Supp. 2d 649, 660-61, 672 (S.D.N.Y. 

2005) (granting judgment on strict liability claim where the identification of cargo was deemed 

insufficient to establish that vessel owner consented to transport Cal-Hypo). 

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The fairness-based interpretation of strict liability under COGSA expands liability 

beyond the “shipper.” See In re M/V DG Harmony, 394 F. Supp. 2d at 670-72 (addressing a strict 

liability COGSA claim where both the vessel and cargo interests “did not have actual or 

constructive pre-shipment knowledge of the true nature of the cargo or the full extent of the 

danger presented.”). In interpreting COGSA § 1304(6), the Court went on to state that: 

Congress did not limit liability under the section to any particular 

class of entities, nor did Congress impose a requirement of privity. 

It would make no sense to read § 1304(6) to protect only the issuer 

of the bill of lading. . .[i]t is the vessel and cargo owners whose 

property is damaged or destroyed who require protection. 

Id. at 672. Therefore, strict liability may be imputed to all the named Defendants as well as their 

agents. 

Finally, in their motion, Defendants cite Skibs A/S Gylfe v. Hyman-Michaels Co., 304 F. 

Supp. 1204, 1221 (E.D. Mich. 1969) for the proposition that there is no strict liability violation 

of COGSA where the carrier is aware of the hazard presented by the cargo prior to loading. Our 

case is clearly distinguishable since the facts show that plaintiff had no knowledge, actual or 

constructive, that it was shipping Cal-Hypo. For the same reasons, this case is also 

distinguishable from Contship Containerlines, Ltd. v. PPG Industries, Inc., 443 F.3d 74 (2d Cir. 

2006). 

POINT II

ZIM IS ENTITLED TO ITS CHOICE 

OF FORUM ABSENT A STRONG SHOWING 

OF INCONVENIENCE BY DEFENDANTS 

 Any consideration of a motion to dismiss on the basis of forum non conveniens must 

begin from the assumption that the plaintiff is entitled to its chosen forum, unless the moving 

defendants meet their burden of demonstrating that the forum is inconvenient. Iragorri v. United 

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18

Techs. Corp., 274 F.3d 65, 72 (2d Cir. 2001). Courts should give deference to a plaintiff's choice 

of forum. 

Sinochem and Nanjing Huabin are the only two defendants which have moved to have 

this action dismissed on the grounds of forum non conveniens. None of the other parties 

appearing in the action or in the related action (07 Civ. 6500) have joined in the forum non 

conveniens motion. Given the fact that there are parties to both actions which have not moved 

for dismissal on forum non conveniens grounds, any concession to the moving parties will result 

in the splintering of this litigation with no corresponding savings of judicial economy. 

A. A Case-by-Case Analysis: 

 The Supreme Court and the Second Circuit have laid-down a sliding scale test to 

determine whether a motion to dismiss an action for forum non conveniens. Gulf Oil Corp. v. 

Gilbert, 330 US. 501 (1974); Iragorri v. United Techs. Corp., 274 F.3d 65, 72 (2d Cir. 2001). 

The test is made up of three parts, first the Court must determine the deference to be given to the 

plaintiff’s choice of forum; second, the defendant seeking dismissal must establish that there is 

an adequate alternative forum; and third, the Court must balance the private and public interests 

implicated in the choice of forum. Norex Petro. v. Access Industries, 416 F.3d 146, 153 (2d Cir. 

2005). 

1. Zim’s choice of forum should be given deference: 

There is initially "a strong presumption in favor of the plaintiff's choice of forum." Piper 

Aircraft Co. v. Reyno, 454 U.S. 235, 255, 70 L. Ed. 2d 419, 102 S. Ct. 252 (1981). It is generally 

understood that, "unless the balance is strongly in favor of the defendant, the plaintiff's choice of 

forum should rarely be disturbed." Gulf Oil Corp. v. Gilbert, 330 U.S. at 508. Courts recognize, 

however, that "the degree of deference given to a plaintiff's forum choice [can depend upon] the 

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19

circumstances." Iragorri v. United Techs. Corp., 274 F.3d at 71. Courts give the greatest 

deference to a plaintiff's choice of its home forum. See Id.; accord Piper Aircraft Co. v. Reyno, 

454 U.S. at 255-56; Koster v. (American) Lumbermens Mut. Casualty Co., 330 U.S. 518, 524, 91 

L. Ed. 1067, 67 S. Ct. 828 (1947), while "less deference" is afforded a foreign plaintiff's choice 

of a United States forum, Iragorri v. United Techs. Corp., 274 F.3d at 71. 

 While Zim is an Israeli company, within the context of this case, the Court should give 

Zim’s choice of forum greater deference because there are legitimate reasons for Zim’s choice of 

this forum. Bigio v. The Coca Cola Co., 448 F.3d 176, 179 (2d Cir. 2006): 

• The m/v ZIM HAIFA was under the operational control of Zim’s U.S. agent, ZimAmerican Integrated Shipping Services, Inc., which is located in Norfolk, Virginia, which 

was responsible for Zim’s response to the explosion and attempts to save the crew, vessel 

and cargo. Zim-American also arranged for all experts which responded to the vessel as 

well as all surveyors who inspected the vessel and damaged cargo. The only sample of 

the cargo which exploded and which is hazardous to move is located in the U.S. The 

Southern District of New York is Zim’s chosen forum, as provided for in its bill of lading 

contract, for venue in any litigation in the U.S. (Jones Decl. ¶¶ 26-31, 30, 33-36, 45 and 

Curtin Decl. Ex. A) 

• The m/v ZIM HAIFA was bound for U.S. ports on the voyage during which the 

explosion occurred. While the Sinochem cargo was not bound for the U.S., all of the 

cargo that was damaged on board the vessel [with the exception of one] are U.S. entities. 

Nearly half of the cargo damaged on board the vessel was bound for the U.S. All 

surveyors hired by those U.S. cargo owners/insurers are located in the U.S. All of the 

evidence collected by the surveyors documenting the damage to cargo and containers is 

located in the U.S. Cargo interests have indicated that they will be bringing suit against 

Zim in the U.S. (Jones Decl. ¶¶ 23 and Willoughby Decl. ¶¶ 5, 12-14, 16, 19). 

• The purchaser of the cargo that exploded is located in the U.S. and not amenable to suit 

in China. With the exception of Sinochem and Huabin, the other Chinese defendants are 

satisfied with the present forum. To the extent that witnesses are located in Panama, it is 

much easier and economical to travel to New York than it is to travel to China. The vast 

majority of the documents involved in this case are in English and will require to be 

translated into Chinese should this case be dismissed in favor of the Chinese forum. 

(Jones Decl. ¶¶ 42-44 and Qian Decl. ¶ 11). 

As the foregoing list shows, there is no element of “forum shopping” associated with 

Zim’s choice of this Court for the present law suit. The Southern District of New York is Zim’s 

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regular and preferred forum for litigation [as shown by its bill of lading jurisdiction clause] and it 

is the most convenient forum for all of the parties concerned in this action. To a great extent, it 

is even convenient for Sinochem and Huabin, both of which participate in the global economy 

and should be accustomed to litigation in the U.S.; especially Sinochem which regularly avails 

itself of the benefits of the U.S. judicial system. 

Sinochem’s commercial website states that it has established “close and sound 

partnerships with customers from ... America...”. (DuPont Decl. ¶5). It has three sister or 

related companies located in Houston, Texas, and New York, one of which is Sinochem 

(U.S.A.), Inc. Sinochem (USA), Inc. describes itself as the “backbone trading subsidiary of the 

Sinochem Corporation in the U.S.” and “the seamless supply channel between Chinese producers 

and US end users”. (DuPont Decl. ¶ 7, 11). Sinochem (U.S.A.), Inc. is an entity incorporated 

under the laws of New York and its Chairman, Mr. Gu Limnin, is none other than Defendant 

Sinochem’s current president who directed the U.S. entity for four years. (DuPont Decl. ¶ 8-10). 

One fails to see how there would be any inconvenience, let alone hardship, for Sinochem’s 

president, Mr. Gu Limnin, or his employees, to testify in a United States court. Moreover, 

Sinochem previously made itself available to the U.S. Courts in a case involving a similar 

shipment of hazardous chemicals. Compania Sudamericana de Vapores, S.A. v. Sinochem 

Tianjin Co., 2007 U.S. Dist. LEXIS 24737 (S.D.N.Y. 2007). 

2. China is not an adequate alternative forum: 

China is not a satisfactory alternate forum for the adjudication of this matter because it 

would render Zim’s claims time barred after one year from the date of the explosion. (Qian Decl. 

¶ 7). There can be no extension of that time period. (Qian Decl. ¶ 8) It would be next to 

impossible for Zim to abandon the U.S. litigation and scramble to assemble a new legal team and 

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lawsuit in China. At the very least, the time needed to translate the thousands of pages of 

exhibits from English to Chinese, as required by any Chinese court, would extend past the one 

year time bar. (Qian Decl. ¶ 22). 

Moreover, as a plaintiff, Zim may only bring an action against all of the Chinese parties 

before one court in China, the Ningbo Maritime Court. (Qian Decl. ¶¶ 5, 6). Chinese Courts 

might not have jurisdiction over Belco. (Qian Decl. ¶ 11). Plaintiff’s action seeking damages 

based on the false declaration of a cargo by the defendants would be an action in contract against 

the shipper, and would exclude any additional causes of action in civil law, including tort. (Qian 

Decl. ¶ 10). 

The Chinese forum presents a “fundamental obstacle” to Zim’s recovery and is therefore 

clearly an unsatisfactory alternate forum. See Morris Zweig v. National Mortgage Bank of 

Greece, 1993 US Dist. LEXIS 8460, *28 (S.D. N.Y. 1993) (alternative forum adequate only if it 

provides a similar cause of action.); Sussman v. Bank of Israel, 801 F. Supp. 1068, 1076 

(S.D.N.Y. 1992, aff’d, 990 F.2d 71 (2d Cir. 1993). 

Through their own moving papers, Sinochem and Huabin have made it abundantly clear 

that Chinese law does not recognize Zim’s cause of action for strict liability for failure to warn 

and negligent failure to warn. (Chen Decl. ¶9). In addition, Zim’s cause of action for strict 

product liability could not succeed in China because Chinese law does not recognize the failure 

to declare the existence of a defect in the product as giving rise to a strict product liability claim. 

(Qian Decl. ¶ 38). Furthermore, a party may not claim punitive damages under Chinese law. 

(Qian Decl. ¶ 40). The Ningbo Maritime Court would exclude any tort causes of action, such as 

negligent misrepresentation and fraud. (Qian Decl. ¶ 10). In short, no remedy would be left for 

Zim in China against the Defendants. This would certainly constitute a “fundamental obstacle” 

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to Zim’s recovery and demonstrates the inadequacy of China as an alternate forum.4 See PT 

United Can Co. v. Crown Cork & Seal Co., 138 F.3d 65, 74 (2d Cir. 1998) (alternative forum 

does not need to propose identical causes of action as long as causes of action available in that 

forum adequately address the underlying controversy); Joseph P. Lasala v. UBS, AG, 510 

F.Supp.2d 213 (S.D.N.Y. 2007). By granting the motion the Court would foreclose Zim’s ability 

to assert most of its claims, including all of the tort claims, against Sinochem and Huabin. 

3. The Gilbert private factors do not support dismissal: 

 Should the Court find that there is an adequate alternative foreign forum, the Court must 

then balance the convenience of the parties and witnesses, based upon certain private and public 

factors. The requisite private factors are: 

 (1) the relative ease of access to sources of proof; (2) the availability of 

compulsory process for attendance of unwilling witnesses; (3) the cost of 

obtaining attendance of willing witnesses; (4) issues concerning the 

enforceability of a judgment; and (5) all other practical problems that 

make trial of a case easy, expeditious, and inexpensive -- or the opposite. 

Gulf Oil Corp. v. Gilbert, 330 US. 501, 508 (1947) 

 As already set forth in Section 1, infra., Zim’s choice of the present forum should be 

given great deference because there are overwhelming reasons why the Southern District of New 

York was chosen, and why it provides a convenient forum. If the Court were to grant this 

motion, it would bifurcate the litigation, at least double the cost of the litigation, and 

inconvenience the injured parties, including the American cargo interests whose goods were 

damaged on board the vessel. 

 

 

4

 Additionally, Chinese Courts do not seem to offer adequate “Procedural Safeguards”. See Qian Decl. ¶¶ 13-16, 

18-20, 22. 

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4. The Gilbert public interests favor retention of this matter: 

 The Gilbert court also set-out a series of “public interests” which should be considered in 

a motion for dismissal on forum non conveniens grounds: 

Factors of public interest also have place in applying the doctrine. 

Administrative difficulties follow for courts when litigation is piled up in 

congested centers instead of being handled at its origin. Jury duty is a 

burden that ought not to be imposed upon the people of a community 

which has no relation to the litigation. In cases which touch the affairs of 

many persons, there is reason for holding the trial in their view and reach 

rather than in remote parts of the country where they can learn of it by 

report only. There is a local interest in having localized controversies 

decided at home. There is an appropriateness, too, in having the trial of a 

diversity case in a forum that is at home with the state law that must 

govern the case, rather than having a court in some other forum untangle 

problems in conflict of laws, and in law foreign to itself. 

Gilbert, 330 U.S. at 508-509. 

 Despite the efforts by Sinochem and Huabin to obscure the issues, there is no basis for 

this case to be dismissed in favor of the proposed Chinese forum. Even if this Court were to 

dismiss this action, U.S. cargo interests would still maintain their suits in this Court against Zim 

and Belco. 

 All nations have an interest in the safety of goods in transit and the transportation system. 

The U.S. has as much of an interest in adjudicating this matter as any other country. 

The burden is on the moving parties to establish that “trial in the chosen forum would 

establish...oppressiveness and vexation to a defendant...out of proportion to the plaintiff’s 

convenience.” Sinochem International Co., Ltd., v. Malaysia Int’l Shipping Corp., 127 S.Ct. 

1184, 1190; 167 L.Ed.2d 15 (2007)(Not officially reported). The moving parties have failed 

in this regard and their motion should be denied. 

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POINT III

OPPOSITION TO DEFENDANT BELCO’S MOTION TO VACATE 

THE RULE B ATTACHMENT PURSUANT TO RULE (E)(4)(f)

Zim respectfully submits this Memorandum of Law in opposition to the motion of 

Defendant Belco to vacate Zim’s Rule B attachment. 

 Defendant Belco cites repeatedly to the Second Circuit’s ruling in Aqua Stoli Shipping 

Ltd. v. Gardner Smith Pty, Ltd., 460 F.3d 434 (2d Cir. 2006) in support of its motion to vacate 

Plaintiff’s Rule B attachment under Supp. R. Certain Adm. & Mar. Claim E(4)(f). 

Belco argues that “vacatur is warranted when the defendant can show that it would be 

subject to in personam jurisdiction convenient to Plaintiff”. (Mot. Dism. p. 28). (emph. add.). 

In Aqua Stoli, however, the Second Court ruled that the concept of “convenience” is a 

narrowly circumscribed one: “a district court may vacate a maritime attachment only if the 

defendant would be subject to an in personam lawsuit in a jurisdiction adjacent to the one which 

the attachment proceedings were brought”. Id. at 444. The Court clearly had in mind only the 

“across the river” situation contemplated in Det Bergenske Dampskibsselskab v. Sabre Shipping 

Corp., 341 F.2d 50, 52-53 (2d Cir. 1965), where the plaintiff attached assets of the defendant in 

the Eastern District, whereas the defendant was in fact located in the Southern District. The 

Second Circuit made a point of stating: 

It is less clear to us that a district court could vacate an attachment 

on convenience grounds where the adjacent district is more remote

and therefore less obviously “convenient” to the plaintiff. 

Aqua Stoli, id. at 444. (emphasis added). Here, Plaintiff attached assets of Belco in the Southern 

District of New York. Belco is located in North Carolina. North Carolina is obviously not an 

adjacent district. Therefore, Defendant Belco’s argument falls short of the narrow definition of 

“convenience” as set forth by the Court in Aqua Stoli. 

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 Defendant Belco also cites to Aqua Stoli for the proposition that “a maritime attachment 

is properly vacated if the plaintiff and defendant are both present in the same district to attach the 

defendant’s assets”. (Mot. Dism. pp. 28-29) (emphasis added). Belco is present in North 

Carolina. It alleges that Zim has “an office in North Carolina where it operates a liner service, 

and is subject to in personam jurisdiction in North Carolina.” (Mot. Dism. page 29). However, 

Belco’s allegations are merely conclusory and are not supported by any facts or declarations. On 

this basis alone, the motion to vacate should be denied. 

The Court of Appeals in Aqua Stoli made it clear that the only “limited circumstances” 

under which a district court “may” vacate an attachment under Rule B: 

While, as we have noted, the exact scope of a district’s court 

vacatur power is not before us, we believe that a district court may

vacate the attachment if the defendant shows at the Rule E hearing 

that 1) the defendant is subject to suit in a convenient adjacent 

jurisdiction, 2) the plaintiff could obtain in personam jurisdiction 

over the defendant in the district where the plaintiff is located; or 

3) the plaintiff has already obtained sufficient security for the 

potential judgment, by attachment or otherwise. 

Aqua Stoli, Id. at 445. (emphasis supplied). Under the second ground for vacatur, Belco must 

meet the two-prong test of establishing that plaintiff Zim is “found within the district” under 

Supp. R. Certain Adm. & Mar. Claim B. See Erne Shipping, Inc. v. HBC Hamburg Bulk Carriers 

Gmbh &Co. Kg, 409 F, Supp. 2d 427 (S.D.N.Y., 2006) (citing Seawind Compania, S.A. v. 

Crescent Line, Inc., 320 F.2d 580, 582 (2d Cir. 1963)). Belco must first prove that Zim can be 

found within the district of North Carolina in terms of jurisdiction, and second, if so, that Zim 

can be found for purposes of service of process in North Carolina. Belco fails on each part of 

this test. 

 First, Belco would have to establish that Zim has “sufficient contacts with the district to 

meet minimum due process standards”. Aqua Stoli, id. at 432 (citing Winter Storm, 310 F.3d at 

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26

268). Defendant Belco may either assert “general jurisdiction” –where the plaintiff’s contacts 

with the state are “continuous and systematic”—or “specific jurisdiction” –that is a jurisdiction 

over a claim arising out the very contacts at issue. Erne Shipping, id. at 433. 

 Here, there is nothing “continuous and systematic”. Zim is located in Haifa, Israel. 

(Compl. ¶3). It has no presence in North Carolina. (Jones Decl. ¶48). Zim has no offices, no 

employees, no phone listing, no property in North Carolina. (Jones Decl. ¶¶ 50, 51, 53). It does 

not advertise in North Carolina. (Jones Decl. ¶52). Zim has not had any vessels calling at the port 

of Wilmington, North Carolina, for nearly a year. (Jones Decl. ¶49). Zim had only a contractual 

relationship with an independent contractor, Wilmington Shipping Co., in Wilmington, North 

Carolina, which ended in April 2007 (Jones Decl. ¶54). 

 Moreover, Zim’s claims against Belco do not arise out of any contact with North 

Carolina. The cargo under bill of lading no. ZIMUNGB670904 did not originate from, nor was 

it booked in, or destined to North Carolina. 

 Lastly, Belco claims, without any support, that it can serve process on Zim in North 

Carolina. In fact, the independent contractor that was used by Zim in North Carolina does not 

have any authority to accept service of process for Zim. (Jones Decl. ¶55). 

Defendant Belco failed to establish that “plaintiff could obtain in personam jurisdiction 

over the defendant in the district where the plaintiff is located.” Aqua Stoli, id. at 445. 

CONCLUSION

 For all the foregoing reasons, Defendants Sinochem and Nanjing Huabin’s motion to 

dismiss with prejudice Counts II through IX of the Second Amended Complaint and vacate the 

Rule B attachment, as well as Defendant Belco’s motion to vacate the Rule B attachment, should 

all be denied. 

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Dated: New York, New York 

 January 11, 2008 

DEORCHIS & PARTNERS, LLP

Attorneys for Plaintiff 

By:____/s/__Vincent M. DeOrchis_________ 

 Vincent M. DeOrchis (VMD-6515) 

 61 Broadway, 26th Floor 

 New York, New York 10006-2802 

 (212) 344-4700 

 Our File: 1236-689

Case 1:07-cv-05861-RMB-GWG Document 38 Filed 01/11/2008 Page 33 of 33