The Honor able Jed S. Rakoff, of the United States District Court for the Southern 1 District of Ne w York, sitting by desig nation. 09
- 28 57
- cv Pri ca s pi an D ev el opmen t Cor por at i on ( T EX AS) v . Roy al D u t ch Sh el l , PLC U N I TED STATES CO U R T O F AP PEA LS F O R T H E S E C O N D C IR C U IT 

### SU MM ARY ORDER
R UL I NG S B Y S UM M ARY OR DE R DO NO T HA V E P RE CE DE NT I AL E F F E CT . C I TATI ON TO A SUM M AR Y ORD ER FI LED A FTER J AN UA RY 1, 2007, I S PE RM I TTED AN D I S GOVERNED BY F EDER AL R ULE OF A PPELLATE P RO CED UR E 3 2 .1 A N D T H IS CO URT ’ S L OC AL R ULE 32. 1. 1. W HE N CI T I NG A S UM M ARY OR DE R I N A D OC UM E NT F I L E D W I T H T HI S CO URT , A PA RTY M UST CI TE EI THER THE F EDER AL A P P EN DI X OF AN ELECTRO NI C D ATA BASE ( W I T H T HE NO T AT I ON “ S UM M ARY OR DER ” ). A PAR TY CI TI NG A SUM M AR Y ORD ER M UST S ERVE A C OPY OF I T ON A NY PA RTY NO T REPR ES ENTED BY CO UN SE L . At a stated te rm of the United States Court of A ppeals for the Second Circuit, held at the Daniel Patric k Moy

nihan United States Courthouse, 500 Pear l Street, in the City of Ne w York, on the 29 day

of June, two thousand ten. th PRES ENT: AMALYA L . KEARSE,

P E T E R W
. H A LL, Circuit Judges , J ED S . RAKO FF, District Judge
. 1

_______________________________________________________ Pricaspian De velopment Corporation (TEXAS), Plaintif f-Appellant , v. No. 09-2857-c v Roya l D utc h Sh e ll, PL C, Defendant- Appellee ,

________________________________________________________ Ap pe ari ngfo r A

pp e lla nt: D A N I EL L. A B R AMS , New Y ork, Ne w York. Ap pe ari ngfo r A

pp e lle e s: G R AH AM KER I N B LA IR , ( Da vid A. B ra ke bil l, And

re w C
. B ibe rs te in, B ake r & Mc Ke nzie L L P, H ou sto n, Te xas; Michae l A. Pollard, Baker & McKe nzie L L P, Chi cag o, I llinois , on the brief

), B aker & Mc Kenzie L L P, Houston, Texas.2

Appea l from a judg ment of the United States District Court for the Southern District of New Y ork (Cote, J. ). UP ON DUE CONSIDERATION WHERE OF , i ti s h e r e b y ORDERED, AD JU DG ED , A ND DE CREED that th e jud g me nt o f t he dis tr ic t c ourt

is AF F IRM ED
. Pricaspian De velopment Corporation (TEXAS) (“ Pricaspian” ) appe als the district court’ s dismiss al of its decla

ratory judgme nt action ag ainst Roy al Dutch Shell (“ RDS”). Pricaspian’ s action, dismissed on re

s ju dic ata g ro un ds , a sse rt e d c la ims a g a ins t RD S of anti c ipate d unju st
e nr i c h m e n t . W e a s s um e th e p art i e s ’ f am i l i ar i ty w i thth e r e l e v an tf a c t s an d p r o c e d ur a l h i s t o r

y. “We re view de novo the district court’s a pplication of the princ iples of res judicata. ” Legnani v. Alitalia L inee Ae ree I taliane, S.P.A., 4 0 0 F
. 3 d

1 3 9 , 1 4 1 ( 2 d

C i r . 2 0 0 5 )
. In
c on sid e ri ngthe dis tr ic t c ourt ’s g ra nt o f RDS’ s mo tio n to dis mis s, we “ a c c e pt[] a s tr ue a ll f a c ts alleg ed in the complaint ‘a nd draw [] all infere nces in the pla intiff’s favor.’” Y ung v. Lee, 432 F. 3 d 1 4 2 , 1 4 6 (2 d

C i r. 2 0 0 5 ) ( qu o t i n g Rombach v . Chang, 355 F.3d 164, 169 ( 2d Cir. 2004)). Pricaspian f

iled its complaint ag ainst RDS in t he Southern District of N ew Yor k. Fe dera l jurisdiction in the case is base d on diversity of citizenship. “In diversity case s, ‘state statutes of limit ations g overn the timeliness of state law c laims’, and state la w ‘de termines the r elated questions of what e vents serve to commence an ac tion and to toll t he statute of limitations.’” Diffley v. Allied-Signal, Inc ., 9 2 1 F. 2 d 4 2 1 , 4 2 3 (2 d

C i r. 1 9 9 0 ) ( qu o t i n g Personis v. Oiler, 889 F.2d 424, 426 ( 2d Cir. 1989)). Ne w York e mploy s a borr owingstatute, N.Y. C.P.L .R. § 202, which “r equire s that a cour t, when pre sented with a c ause of action ac cruingoutside New Y ork, . . . apply the limitation period of the fore ign jur isdiction if it bars the claim.” Ins. Co. of N. Am. v. ABB Powe r Gene ration, Inc., 91 N.Y.2d 180, 187 (1997) . The district cour t, determining Col or a do to b e Pr ic a sp ian’ s p ri nc ipa l pl a c e of bu sin e ss, a s w e ll a s th e loc atio n whe re it a lle g e dlyRD S wa s in c or po rate d in

20 02 . T he de fe nd ants in t he Col or a do De c isi on

we re She ll 2 Expl or atio n B .V . a

nd She ll Inte rn atio na l E xplor atio n a nd Pr od uc tio n B .V ., f/k/a

She ll Inte rn atio na l Pe tr ole um M a atsc ha pp ij B .V . ( the “ She ll Su

bs idi ari e s” ). Pla int if

f a sse rt e d in

its Colorado complaint that two additional def endants that we re dismissed from the suit for lack of persona l jurisdiction, R oy al Dutch Petrole um Company and Shell Transpor

t and Tra ding Company plc (the “ Shell Parent Entities”), “jointly controll[ed] approximately 1370 subsidiaries” g lobally , including the Shell Subs idiaries. In a dec laration submi tted to the District Court for the Southern D istrict of NewYork in opposition to R DS’ motion to di smiss, P rica spian asser ted that “RDS [is ] t he ultimate par ent company of Shell, replac ing Royal Dutch Petrole um and Shell Transpor

t & Tr ading .” We consider it undisput ed that the Shell Pare nt Entiti es ar e RD S’ pr e de c e sso rs in i nte re st. 3 sustained ec onomic harm, found that Pricaspian’s c auses of action ac crue d in Colorado. See Global Fin. Corp. v. Tri arc Corp., 93 N. Y. 2d 52 5, 52 9 ( 19 99 ) ( “ Whe n a n a lle g e d in

jur y is p ur e ly
e c on omi c , th e pla c e of

inj ur y us ua lly is whe re the pla int if

f r e sid e s a

nd su sta ins the e c on omi c impact of the loss.”) . The district cour t concluded that beca

use the United States District Court fo r t he Di str ic t of

Col or a do ha d a lr e a dy

fo un d th e same c la ims tim e -b arr e d in a 20 06 jud g me nt, aff irmed by the Tenth Circuit (the “ Colorado Dec ision”), Pricaspian’ s cause s of ac tion were untimely in Colorado. Applying N ew Yor k’s borrow ing statute and findingthat the re maining 2 elements of c laim prec lusion were satisfied, the district court he ld that Pricaspian’s c laims were also untimely

in New Yor

k. Pricaspian a sserts that in applying the borrowingstatute, the district court should have
a pp lie d N e w Y or

k la w a nd no t Co lor a do law t o d e te rm ine the tim e lin e ss o f i ts c a us e s o f a c tio n in Colorado. The a

rgument is without support i n New Y ork or Sec ond Circuit jurisprudence interpre ting Ne w York’ s borrowingstatute. See Sm ith Barney, Harris Upham &Co. v. Luckie, 85 N.Y.2d 193, 207 (1995) ( Smith Barney abrogated on othe r grounds by Mastrobuono v. Shearson Lehman Hutton, Inc ., 514 U.S. 52 (1995)) ( “In borrowingthe fore ign statute, ‘[a]l l the extensions and toll s applied in the for eign state must be imported with the for eign statutory4

period, so that the entire fore ign statute of limitations . . . applie[ s], and not merely its period.’” (alter ation and omission in original) ( quoting Mc L aughlin, Practice Commentar ies, McKinney ’s Con s. L aws of

Ne w Y or k, B oo k 7 B , CPLR C2 02 :3, at 10 9) ); ac c or d S tua rt v . A m. Cy an am id Co., 158 F.3d 622, 627 ( 2d Cir. 1998) (“[A]n action by a nonre sident on a for eign cause of ac tion is untim ely

if it is barred unde r the lawof either New Y ork or the state wher e the injury
oc c ur re d. ” ); see also Cantor Fitzgerald Inc. v. Lutnick, 313 F.3d 704, 710 ( 2d Cir. 2002) (re lying upon either “ California or N evada law to deter

mine when the thr ee- y ear statute of limitations beg an to run” and conc luding that “ [b] eca use . . . California a

nd Neva da have the same r ules for de te rm ini ngwh e n th e statut e of lim itatio ns c omm e nc e s, we ne e d n ot d e c ide wh ic h s tate ’s ru le
a pp lie s” ). Ac c or din g ly , th e dis tr ic t c ourt did no t e rr in c on c lud ingthat Pr ic a sp ian’ s c la im, if untimely under Colora do law, wa s also untimely in New Yor

k. Pr ic a sp ian a sse rt s in

the a lte rn ativ e that un de r N e w Y or k la w g ov e rn ingc la ims fo r u nju st
e nr ic hme nt i ts c a

us e s o f a c tio n h ave no t ye t ‘ a c c ru e d, ’ a nd the re fo re the bo rr ow ingstatut e sh ou ld not have be en applied in the f irst instance. See N.Y. C.P.L .R. § 202 (“An a ction based upon a
cause of ac tion accruing without [ New Y ork] cannot be c ommenced a fter the expiration of the tim e lim ite d b y

the laws of

e ith e r [N e w Y or

k] or the pla c e wi tho ut [N e w Y or k] whe re the c a

us e of a c tio n a c c ru e d .
. . .” (e mph a sis a dd e d) ). Pr ic a sp ian a lle g e s th at on July 17 , 1 99 0 it s undisputed prede cessor

in interest, J ack Gry

nberg , provided RDS repr esentatives with secre t inf or matio n r e latin gto o il a

nd g a s f ie lds in K a zak

hs tan in e xch ang e fo r t

he “ ri g ht t o late r s ha

re in the profits of oil and natural g as produc tion in accor dance with any subsequent agree ment to do so made with the g overnme nt of Kazakhstan.” Compl. at ¶ 11. Pricaspian alleg es that on October 31, 2008, Shell, using Gry nberg ’s information, sig ned an a g ree ment with the5

g overnme nt of Kazakhstan f or the de velopment of a

n oil field in Kazakhstan and the a g ree ment purports to cut Pricaspia

n out of the dea l. Be cause the oil field has not yet produc ed any net profits, Pricaspian ma intains that its cause of a ction for unjust enric hment has yet to acc rue. Pricaspian a

rgues that under Golden Pac ific Bancorp v. FD IC, 273 F.3d 509 ( 2d Cir. 2001), an unjust enr ichment claim does not a ccr ue in New

York until “a de fenda

nt is paid money which equity

and g ood conscie nce r equire s be re turned to the plaintiff.” Pet. Br. a t 15-16. Pricaspians’ inter

pretation of New Y ork’s unjust enric hment law is in err or. In Go lde n Pac ifi c
we r estated w ell-settled law in Ne w York that a ca use of a ction for unjust enric hment acc rues “‘upon the occur

renc e of the wrong ful ac t givingrise to a duty of re stitut ion.’” Golden Pac

. Bancorp, 2 7 3 F. 3 d

at5 2 0 (qu o t i n g Congregation Y etev Lev D'Satmar, Inc. v . 26 Adar N.B. Cor p ., 59 6 N .Y .S. 2d

43 5, 43 7 ( Ap p. Di v. 2d

De p' t 19 93 )) ; see also Sitkowski v. Pe tzing , 572 N.Y.S.2d 930, 932 (App. Div. 2d De p’t 1991). He re, it is alleg ed that the wro ng ful ac t that eventua lly

g ave r ise to a duty

of re stitut ion occur

red on June 9, 1993, when, a fter g oing be hind Gry nberg ’s bac k, RDS entered into the ‘ Preliminary Consortium Agre ement’ dire ctly with the g overnme nt of Kazakhstan, without the par ticipation of Gry

nberg , callingfor RDS to make pay ments to the g overnme nt of Kazakhstan a nd undertake g eolog ical studies in exchang e for exploration and production rights. That the value of the re stitut ion owed would not be known until profits beg an flowingfrom the Kazak oil fields does not chang e the date of the wrong ful ac t that g ave r ise to the underly ing duty of re stitut ion. Pr ic a sp ian f

ur the r a sse rt s th at be c a

us e RD S us e d Pr ic a sp ian’ s c on fi de nti a l in fo rm atio n in 2008 to sign a

n agree ment with the g overnme nt of Kazakhstan, subseque nt to the Colorado Dec ision, that “it was illogica l for the [district] [c] ourt to conclude that Pricaspian c ould not6

ma int a in a

laws uit ba se d o n wro ng s c omm itt e d b y RD S afte r the Colorado De cision.” Pr ic a sp ian, ho we ve r, mis se s th e po int that a lth ou g h it s in sta

nt c la im t o unju st e nr ic hme nt i s indeed ba sed upon a subse quent transa ction, it arises fr om RDS’ alleg ed use of the same confide ntial information that was the ba sis for the cla ims asserted in the Colorado D ecision. Pricaspian’ s new c laim is not based upon post-2003 fac ts in any meaning ful way
. See W

aldman v. Village of Kiryas Joel, 20 7 F .3 d 1 05 , 1 13 (2 d Ci r. 20 00 ) ( ho ldi ngthat re s ju dic ata wi ll a

pp ly when the ne w fa cts are “nothingmore than a dditional inst ance s of what wa s previously asser ted . . . [and the plaintiff] based his [ second] action princ ipally upon the common nucleus of op e rativ e fa c ts s ha

re d w ith[the pr e vio us a c tio n]” ). B e c a us e Pr ic a sp ian’ s c la ims a sse rt e d in thi s
c a se re ly up on the same nu c le us of

op e rativ e fa c ts a s th os e c la ims br ou g ht i n Co lor a do , th e re is an identity

of cla ims necessa

ry to satisfy the re quirements of res judiciata, and these claims wer e proper ly dismiss ed. Pricaspian f

inally asser ts that the district court er red in findingan identity

of par ties betwee n the def

endants in the Colorado D ecision and those in the instant suit. Res judicata wi ll
a pp ly wh e n “ the pa

rt ie s [are ] the same a s th os e in t he fi rs t a c tio n o r p e rs on s in pr ivi ty wi th them.” Cruz v. Benine, 984 P.2d 1173, 1176 (Colo. 1999). “[A] bsent a leg ally distinct basis for
re c ov e ry a g a ins t [a ] co rp or ate pa

re nt, fi na l ju dgme nt a g a ins t [a ] wh oll y owne d s ub sid iary

[wil l] result[] in claim prec lusion.” Strekal v. Espe , 114 P.3d 67, 70 (Colo. C t. App. 2004), c e rt. denied, No
. 0 5 -S C 3 6 2 0 0 5 C o l o . L E XIS 5 9 3 (J un e 2 7 , 2 0 0 5 ) ( ci t i n g Mars Inc. v . Nippon Conl ux 58 F.3d 616, 619 ( Fe d. Cir. 1995)). B efor e the district cour t, as well as on a

ppeal, Prica spian has
no t de mon str ate d th at th e re is a ny ba sis fo r r e c ov e ry

a g a ins t th e She ll Su

bs idi ari e s su

bje c t to su it in Colorado that is leg ally distinct from the bases a sserted a g ainst their Shell Parent Entities --7

now RDS -- def

endingthe instant action in NewYork. Indeed, a s the district court noted, Pricaspian’ s Colorado complaint “a sserted [claims] gene rally ag ainst ‘Shell,’ an amalg amation of the . . . named de fenda

nts. The fa ctual basis for the complaint did not differ entiate the a lleg ed wrong doing by

defe ndant, but simply

claimed that ‘ Shell’ cut Gry nbergout of the . . . dea l.” The district cour

t did not err in findingthat there was a n identity of par ties nece ssary

for application of the res judicata doctrine. CO NC LU SION Findingthe re mainder of

appellant’ s arguments without merit, and for the r easons state d
a bo ve , th e jud g me nt o f t

he dis tr ic t c ourt

is AF F IRM ED
.

F OR TH E CO UR T: Catherine O ’Ha g an Wolfe, Clerk