Court Opinion

ID: 2962466
Source: CourtListenerOpinion
Date Created: 2015-09-21 20:58:07.708459+00
Date Added: 2024-06-11T11:21:00.602710
License: Public Domain

USCA1 Opinion

	

          March 31, 1994        [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ___________________          No. 93-2263                                                SURFACT, INC.,                                Plaintiff, Appellant,                                          v.                             SOUTH PEARL CHEMICAL, INC.,                                 Defendant, Appellee.                                  __________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF PUERTO RICO                   [Hon. Gilberto Gierbolini, U.S. District Judge]                                              ___________________                                 ___________________                                        Before                                 Breyer, Chief Judge.                                         ___________                          Selya and Boudin, Circuit Judges.                                            ______________                                 ___________________               David Efon and Kevin G. Little on brief for appellant.               __________     _______________               Gloria L. Lebron  Nieves and  Cobian & Valls,  on brief  for               ________________________      ______________          appellee.                                  __________________                                  __________________                 Per  Curiam.     Appellant  Surfact,  Inc.,  a   Florida                 ___________            corporation, appeals  the  dismissal for  lack  of  diversity            jurisdiction  of its  action  against appellee,  South  Pearl            Chemical, Inc.  We affirm.                                          I                 On February 1, 1988,  appellant Surfact, entered into an            exclusive  dealership  agreement with  South  Pearl Chemical,            Inc.   According  to appellant,  the agreement  was illegally            terminated on January 31,  1990, in violation of Puerto  Rico            Law 75,  10 L.P.R.A.    278.  Appellant  brought suit in  the            United  States District Court for the District of Puerto Rico            and invoked  diversity jurisdiction  pursuant to 28  U.S.C.              1332.   Appellee  in  turn  moved  to  dismiss  for  lack  of            diversity.     A  magistrate   judge  issued  a   report  and            recommendation  that  the  motion  for dismissal  be  granted            because  both   parties   to  the   agreement  were   Florida            corporations.  The district court affirmed.                                            II                      The dispute in  this case  arises out  of the  fact            that  there have been  two corporations with  the name "South            Pearl Chemical,  Inc."   One corporation [South  Pearl Puerto            Rico] was incorporated in 1984 in the Commonwealth of  Puerto            Rico.  South Pearl Puerto  Rico amended its corporate charter            in July  1987 to change its corporate name to Ole South Pearl            Chemical, Inc.   The other corporation  [South Pearl Florida]                                         -2-            was incorporated  in 1987 in  the state of  Florida.   In May            1987,  Ole  South  Pearl  transferred  all  its  "assets  and            business" to South  Pearl Florida in exchange  for 800 shares            of  South   Pearl  Florida  common  stock.1     However,  the            corporations  remained  separate  entities.    The  exclusive            dealership   agreement  between   Surfact  and   South  Pearl            Chemical,  Inc. was entered into  almost ten months after the            transfer  of assets between  Ole South Pearl  and South Pearl            Florida.                         Surfact asserts that it entered into the  exclusive            dealership  agreement with  Ole  South Pearl.   The  district            court, however,  found that the exclusive dealership contract            had  been entered  into by Surfact  and South  Pearl Florida.            Hence, diversity of  parties was absent.   We review findings            of jurisdictional  facts only for  clear error.   See,  e.g.,                                                              ___   ___            Marshall County Bd.  of Educ. v.  Marshall County Gas  Dist.,            ____________________________      _________________________            992 F.2d  1171,  1178 (11th  Cir. 1993);  Rocovich v.  United                                                      ________     ______            States, 933 F.2d 991, 993 (Fed. Cir. 1991).            ______                      The district  court's finding is supportable in the            record.   Prior to  the signing of  the exclusive  dealership            agreement, all  Ole South Pearl's "assets  and business" were            transferred  to South  Pearl Florida.   From this,  the court            could  have  inferred that,  at  the  time of  the  exclusive                                            ____________________            1.  The transfer agreement, dated May 31, 1987, refers to Old            South Pearl, Inc., even though the amendment to the corporate            charter changing the name was not filed until July 24, 1987.                                         -3-            dealership agreement, South Pearl Florida was the only active            corporation  and thus the  only one which  would have entered            into the agreement with Surfact.  This inference is confirmed            not  only by  the fact that,  by the  time of  the agreement,            South Pearl Puerto  Rico had  changed its name  to Old  South            Pearl,  but also by tax  records, which show  that, after the            transfer  of  assets,  South  Pearl  Florida  was  an  active            corporation  with net sales  of over  $1,600,000 in  1988 and            $4,000,000 in 1989,  whereas there  is no record  of any  tax            reports  having  been filed  by Ole  South Pearl  after 1987.            Finally, Heraclio Prieto, who  signed the agreement on behalf            of  South  Pearl  Chemical,  Inc., filed  a  sworn  affidavit            stating that he  did so  as a representative  of South  Pearl            Florida.       Although  other evidence  in the  record might            support a  contrary finding, the district  court's finding is            not  clearly erroneous.   See  Lundquist v.  Precision Valley                                      ___  _________     ________________            Aviation,  Inc., 946  F.2d 8,  11 (1st  Cir. 1991)  (no clear            ______________            error  where factfinder chooses between two permissible views            of the evidence).2                                             ____________________            2.  Appellant also contends that  the district court erred in            dismissing  the case  before  granting appellant  an adequate            opportunity to  conduct discovery  relevant to the  motion to            dismiss.   However, this objection was not  raised before the            magistrate  judge  or   in  appellant's   objection  to   the            recommendation  and  report of  the  magistrate  judge.   It,            therefore, cannot be raised before this  court. See Borden v.                                                            ___ ______            Secretary of Health & Human Services, 836 F.2d 4, 6 (1st Cir.            ____________________________________            1987) (argument which  could have been but was  not presented            to magistrate in first instance is waived on review).                                         -4-                      Affirmed.                      ________                                         -5-