Opinion ID: 3011286
Heading Depth: 2
Heading Rank: 1

Heading: The Jurisdictional Evidence.

Text: The plaintiffs offered documentary evidence before the Magistrate Judge dealing with activity by ORIA and its members to convince foreign governments, foreign rug trade associations, and one domestic rug retailers' association not to provide financial assistance to the CGI trade shows. For example, ORIA wrote to the secretary of the Carpet Export Promotion Council of India (CEPC) that in deciding whether or not to co-sponsor CGI's November 1993 Chicago trade show, the CEPC should consider that doing so would possibly jeopardize a very friendly and prosperous relationship between Indian rug manufacturers and American importers. (JA.92). In addition, defendant Hodges (the president of defendant Pande Cameron & Co. of New York, an importer/wholesaler) wrote to the chairman of the CEPC, expressing his opinion that the CGI 1993 show was destined for failure, asking for the chairman's comments and observations in lending CEPC support to this show, and requesting the names of those exporters from India who plan on exhibiting. With respect to this last request, Hodges wrote: These would be exporters, I can assure you we would avoid in any future business discussions. (JA.93). There is no evidence in this record that CEPC furnished Hodges with these names. CGI planned another trade show in Washington, DC in August 1994. In March of that year, defendant Newman (the president of defendant Noonoo Rug Co.) wrote to the vice-chairman of the Export Promotion Bureau of Pakistan (EPB) and the Pakistan Carpet Manufacturers and Exporters Association (PCMEA) regarding this trade show, urging the PCMEA and the EPB not to encourage nor support the `renegade' activities and selfish motives of a few Pakistani trader/exporters and their American retail counterparts. Newman also noted that [t]o do so would be to continue on the road leading to ill will and chaos. (JA.94-95). The PCMEA subsequently made efforts toward conciliation with ORIA. Its vice chairman wrote to ORIA 6 informing it of PCMEA's decision not to officially participate in the Washington Fair being held in August that year, and of its request that the EPB not give any facility to the participants. He reiterated that no manner of encouragement or patronage would be provided by the Association to any firm desiring to participate in the fair. (JA.96). On March 23, 1994, Hodges, acting in his capacity as ORIA president, wrote to the president of the Oriental Rug Retailers Association (ORRA), a United States trade association, regarding the August 1994 CGI trade show. He stated: Rumor has it that the ORRA has been approached by CGI to cosponsor this function. I think you are well aware of our sentiments regarding the purpose of this trade fair in undermining existing channels of distribution which have proven to be successful to all of us over the years. We would naturally hope that the ORRA would not entertain any thoughts whatsoever in being involved and therefore lending credence to[CGI]. (JA.106). Hodges further noted his belief that politicians directly involved with a child labor bill sponsored by Senator Harkin, a subject high on ORIA's lobbying agenda, would be invited to attend the CGI trade show. Hodges expressed fear that all of our efforts in dealing with the Harkin Bill and responsibly trying to address child labor could be undone by any `loose cannons' developing their own game plan. He concluded with the request that through your leadership, . . . the ORRA take a long and very close look at the negative ramifications in lending your name to this very damaging endeavor. Apparently after interim contact with ORRA, Hodges again wrote ORRA's president on March 28, 1995, expressing his sentiments that Emmert Elsea's attitudes toward wholesalers[are] . . . both incorrect and unhealthy, and of his concern with Elsea's approach toward eradicating child labor. Significantly, the minutes of an April 1994 ORIA membership meeting show that Dan and Gene, presumably a reference to Dan Hodges and Eugene Newman, had contacted the ORRA and obtained its promise 7 not to endorse the August trade show as a group. The minutes also reflect that Gene urged the [ORIA] members who import from Pakistan, India and other countries to write the proper Export Promotion authorities in those countries and advise them not to participate in this show. The minutes of an August 1994 ORIA meeting reflect that this statement was amended to read Gene Newman suggested that the individual members and not the organization engage in this letter writing campaign. In addition, the plaintiffs also offered one piece of documentary evidence intended to show that the defendants were boycotting domestic retailers and foreign manufacturers who supported the trade shows. These were handwritten notes dated May 25, 1994, taken by an unidentified rug retailer in Virginia, of a telephone conversation between the retailer and a representative of defendant Kelaty Rugs International. The notes describe the importer's representative as irate, and record the retailers' fear that because of his cooperation with Elsea,we will not be able to get rugs from anyone. Most significantly, the unidentified retailer stated We are being dealt with from both ends. i.e., cannot get supplied in U.S.[,] also those who supply us from overseas will be boycotted by importers. The Magistrate Judge did not credit this evidence because it was unclear who wrote these notes. When the plaintiffs later objected to the Magistrate Judge's R&R before the District Court, they offered the declaration of someone named William Hirsch, in which Hirsch purported to authenticate these notes as his own. Although the defendants contend that this declaration was not submitted before the magistrate, plaintiffs claim it was submitted and the magistrate simply disregarded it. (Appellants' Reply Br. at 3-4). Finally, CGI offered a declaration of Emmert Elsea dated July 17, 1997. Elsea made the following pertinent representations: 4. Joseph Zarnigin of Zarnigin Rugs, an ORIA member located in New York, informed me and Anne Williams that he would participate in the 1993 trade show except that doing so would jeopardize his membership in and benefits from ORIA. 8 5. DCC, Inc., an ORIA member located in New York, said he would purchase space in the 1993 trade show, but later refused to do so because ORIA strongly opposed the trade show. 6. Rug News[, a trade magazine intended for retail readership,] refused to accept advertising for the 1993 trade show. 7. Decorative Rug[, a similar magazine,] withdrew its acceptance of CGI's advertising on the grounds that it would lose its ORIA customers if it allowed CGI to advertise. The publisher of Decorative Rug also stated that he was being pressured by ORIA to run unfavorable editorials concerning CGI. 8. Anadol Rugs, an ORIA member located in New York, executed a contract and paid a deposit for space in the 1994 trade show. The contract was not forged. Anadol cancelled [sic] its contract after its anticipated participation was revealed to ORIA, and, according to the president of Anadol, ORIA pressured it. The Magistrate Judge recommended that the defendants' motion to dismiss for lack of subject matter jurisdiction be granted. He concluded that FTAIA governed the Court's subject matter jurisdiction and that the plaintiffs failed to establish jurisdiction under the Act because they failed to prove that the defendants' conduct had a direct and substantial effect on United States domestic commerce. (R&R 10-11.)