Free Memorandum in Opposition - District Court of California - California

Case 3:07-cv-06198-MHP

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GILBERT R. SEROTA (No. 75305) Email: [email protected] MARK A. SHEFT (No. 183732) Email: [email protected] MICHAEL L. GALLO (No. 220552) Email: [email protected] HOWARD RICE NEMEROVSKI CANADY FALK & RABKIN A Professional Corporation Three Embarcadero Center, 7th Floor San Francisco, California 94111-4024 Telephone: 415/434-1600 Facsimile: 415/217-5910 Attorneys for Plaintiffs THOMAS WEISEL PARTNERS LLC and THOMAS WEISEL INTERNATIONAL PRIVATE LIMITED UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION THOMAS WEISEL PARTNERS LLC, a Delaware limited liability company, and THOMAS WEISEL INTERNATIONAL PRIVATE LIMITED, an Indian company, Plaintiffs, V. BNP PARIBAS, a French corporation, BNP PARIBAS SECURITIES (ASIA) LIMITED, a Hong Kong company, and PRAVEEN CHAKRAVARTY, an individual, Defendants. No. C-07-6198 MHP Action Filed: December 6, 2007 PLAINTIFFS' CONSOLIDATED OPPOSITION TO DEFENDANTS' MOTIONS TO DISMISS PLAINTIFFS' FIRST AMENDED COMPLAINT Date: August 18, 2008 Time: 2:00 p.m. Place: Courtroom 15 Judge: Hon. Marilyn Hall Patel

REDACTED

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TABLE OF CONTENTS Page(s) INTRODUCTION A. B. The Illegal Raid. Summary Of Argument. 1 1 2 3 3

STATEMENT OF FACTS A. B. TWP LLC Is A Multinational Investment Bank Headquartered In California. TWIPL Is An Indian Subsidiary And Branch Office Of TWP LLC Created To Facilitate TWP Group's India Initiatives, Including Discovery Research. Discovery Research Was Part Of TWP LLC's Integrated Research Business Operated Out Of San Francisco, California. Defendant Chalcravarty Was At All Times A TWP LLC Employee And The Director Of Discovery Research. Defendant BNPP Asia Is Part Of The BNP Paribas Global Banking And Securities Trading Network And, As Such, Does Substantial Business With California Investors. 1. 2. BNP Paribas's Global Network Of Companies Operates As A Seamless Integrated System. BNPP Asia Operates As An Integral Part Of The BNP Paribas Group By Executing Trades On Asian Markets For BNP Paribas Customers Worldwide. BNPP Asia Serves BNP Paribas Clients In California By Executing Trades Worth Well More Than $100 Million.

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Pmfaxiend Orponsnon

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E.

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16 17 18 19 20 21 22 ARGUMENT 23 24 25 26 27 28 I. F.

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3.

BNPP Asia And Chakravarty's Illegal Raid On Discovery Research Destroyed That Business And Harmed TWP LLC.

THE COURT HAS JURISDICTION OVER THIS DISPUTE. A. BNPP Asia Purposefully Availed Itself Of This Court's Specific Jurisdiction By Conspiring With Chakravarty To Commit Wrongful Acts Against TWP LLC, A Known California Resident. 1. Legal Standard.

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TABLE OF CONTENTS Page(s) 2. B. BNPP Asia's Raid On Discovery Research Was Expressly Aimed At TWP LLC. 17

General Jurisdiction Exists Over BNPP Asia Which Provides Substantial, Continuous And Systematic Services To California Investors Through Other BNP Paribas Affiliates That Have Substantial California Contacts. 1. A Foreign Defendant With Minimal Direct Contact With A Forum Nonetheless May Be Subject To General Jurisdiction If It Uses A General Agent For Business Within That Forum. BNP Paribas Affiliate BNPP Securities Corp. Serves As BNPP Asia's California Agent Because It Performs Functions In California That BNPP Asia Otherwise Would Have To Perform For Itself General Jurisdiction Exists Because The California Contacts That Can be Imputed To BNPP Asia Are Substantial, Continuous, And Systematic.

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C.

This Court Has Specific Jurisdiction Over Chakravarty Because He Was A TWP LLC Employee At The Time Of The Conspiracy And Knew That Raiding Discovery Research Would Injure TWP LLC In California. Jurisdiction Over BNPP Asia And Chakravarty Is Reasonable And Necessary For The Furtherance Of Justice. 1. The Purposeful Injection Factor Weighs Strongly In Favor Of Jurisdiction Because BNPP Asia And Chakravarty Expressly Aimed Wrongful Conduct At TWP LLC. Defendants Have Not Shown That Defending This Lawsuit In California Would Be Unduly Burdensome. There Is No Evidence That Hearing This Dispute In California Will Conflict With Indian Sovereignty. California Has A Strong Interest In Hearing This Dispute. A California Forum Will Allow Efficient Resolution Of This Lawsuit And Is Critical To Plaintiffs' Ability To Obtain Convenient And Effective Relief

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D.

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2. 3. 4. 5.

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E.

TWP LLC Has Standing Because It Suffered Direct Injuries From Defendants' Wrongful Conduct.
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TABLE OF CONTENTS Page(s) II. PUBLIC AND PRIVATE INTERESTS REQUIRE THIS COURT TO REJECT DEFENDANTS' FORUM NON CONVENIENS MOTION AND REFUSE TO RELEGATE THIS CASE TO THE INADEQUATE ALTERNATIVE FORUM OF MUMBAI, INDIA. A. B. Legal Standard. Extraordinary Court Congestion And Delays Make The Mumbai, India Court System An Inadequate Forum For This Lawsuit. The Balance Of Both Private And Public Factors Dictates That This Court Retain Jurisdiction. 1. The Balance Of Private Factors Does Not Favor Dismissal. The Balance Of Public Factors Does Not Favor Dismissal.

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C.

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CONCLUSION

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TABLE OF AUTHORITIES Page(s) Cases Ballard v. Savage, 65 F.3d 1495 (9th Cir. 1995) Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 223 F.3d 1082 (9th Cir. 2000) Bhatnagar v. Surrendra Overseas Ltd., 52 F.3d 1220 (3d Cir. 1995) Brunswick Corp. v. Suzuki Motor Co. Ltd., 575 F. Supp. 1412 (E.D. Wis. 1983) Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) Calder v. Jones, 465 U.S. 783 (1984) CE Distribution, LLC v. New Sensor Corp., 380 F.3d 1107 (9th Cir. 2004) Ceramic Corp. of Am. v. Inka Maritime Co., 1 F.3d 947 (9th Cir. 1993) Chhawchharia v. Boeing Co., 657 F. Supp. 1157 (S.D. N.Y. 1987) Dainippon Screen Mfg. Co., Ltd. v. CFMT, Inc., 142 F.3d 1266 (Fed. Cir. 1998) Dole Food Co., Inc. v. Watts, 303 F.3d 1104 (9th Cir. 2002) Energy Reserves Group, Inc. v. Superior Oil Co., 460 F. Supp. 483 (C.D. Kan. 1978) Franchise Tax Bd. of Cal. v. Alcan Aluminum Ltd., 493 U.S. 331 (1990) Freeman v. Gordon & Breach, ScL Publishers, 398 F. Supp. 519 (S.D.N.Y. 1975) Gates Learjet Corp. v. Jensen, 743 F.2d 1325 (9th Cir. 1984) Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122 (9th Cir. 2003) In re Union Carbide Corp. Gas Plant Disaster, 809 F.2d 195 (2d. Cir. 1987) Integral Development Corp. v. Weissenbach, 99 Cal. App. 4th 576 (2002) Jayne v. Royal Jordanian Airlines Corp., 502 F. Supp. 848 (C.D. N.Y. 1980) Mangual v. Gen. Battery Corp., 710 F.2d 15 (1st Cir. 1983) Neo Sack, Ltd. v. Vinmar Impex, Inc., 810 F. Supp. 829 (S.D. Tex. 1993) Orefice v. Laurelview Convalescent Ctr., Inc., 66 F.R.D. 136 (E.D. Pa. 1975)
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TABLE OF AUTHORITIES Page(s) Pacific Atlantic Trading Co., Inc. v. M/V Main Exp., 758 F.2d 1325 (9th Cir. 1985) Palmieri v. Estefan, 793 F. Supp. 1182 (S.D. N.Y. 1992) Panavision Int'l, L.P. v. Toeppen, 141 F.3d 1316 (9th Cir. 1998) PLM Intl, Inc. v. Nath, 1998 WL 514045 (N.D. Cal. 1998) Ravelo Monegra v. Rosa, 211 F.3d 509 (9th Cir. 2000) Roth v. Garcia Marquez, 942 F.2d 617 (9th Cir. 1991) Shanks v. Westland Equip. & Parts Co., 668 F.2d 1165 (10th Cir. 1982) Sinatra v. Nat'l Enquirer, Inc., 854 F.2d 1191 (9th Cir. 1988) Strougo v. Bassini, 282 F.3d 162 (2d Cir. 2002) Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163 (9th Cir. 2006) 25 19, 20 16 31 28, 29 24 19, 20 26 27 18 16

HOWARD RICE JEMEROVSKI CANADY 14 FALK 1 & RABKIN

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Yahoo! Inc. v. La Ligue Contre Le Racisme et L'Antisemitisme, 433 F.3d 1199 (9th Cir. 2006)

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INTRODUCTION A. The Illegal Raid. Plaintiff Thomas Weisel Partners LLC ("TWP LLC") is an investment bank and broker-dealer headquartered in California. Until the events described below, it provided securities research on thinly-covered U.S. stocks through its Mumbai-based subsidiary, Thomas Weisel International Private Limited ("TWIPL"). This product was called Discovery Research. In late October and early November 2007, Defendants BNP Paribas and BNP Paribas Securities (Asia) Limited ("BNPP Asia"; collectively the "BNP Paribas Defendants") raided TWP LLC's Mumbai office. The raid was swift and effective. The BNP Paribas Defendants lured away ten of Discovery Research's fourteen NASD- (now FINRA-I) licensed professionals and at least seven support staff, representing nearly a third of Discovery Research's personnel. The swiftness and effectiveness of the raid was only possible because the BNP Paribas Defendants conspired with a TWP LLC employee and fiduciary--Defendant Praveen Chakravarty. Chakravarty, who was the Director of Discovery Research, arranged for TWIPL's employees to meet secretly with the BNP Paribas Defendants' senior executives; provided BNP Paribas executives with highly confidential information about the employees' salaries and bonuses; and encouraged the targeted employees to leave en masse. A BNPP Asia executive, Jonathan Harris, outlined the scheme in an October 14, 2007 email to Chakravarty: Pierre [Rousseau]2 and I enjoyed meeting with you and your team on our recent trip. Of course we missed our flight by 10 minutes after leaving you at the Oberoi, but made it back to Hong Kong eventually. Pierre and I both came away feeling we had some good discussions and that there 'The result of the merger of the self-regulatory divisions of the National Association of Securities Dealers and the New York Stock Exchange, FINRA is now the chief selfregulatory agency in the United States for broker-dealers and investment banks. 2Pierre Rousseau is the Chief Executive Officer of BNPP Asia and the Global Head of Equity Brokerage for BNP Paribas.
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is a lot of complementary interest. As we discussed, the way we'd like to take this forward is to first identify the core group of your team. I think you said about 20-25 individuals. We'd like to then work on preparing employment documents for all of them. Once you have them and all is satisfactory, we'd look to you to resign from Thomas Weisel enmass. If their reaction is that they'd move to shut down the remainder of the office, we can step in and offer to take over the remainder as a gesture to save them the office shutdown costs. First step would be to get from you a list of all employees, their current comp and job descriptions. Next I'd like you to highlight the 20 or 25 key individuals, and a bit more info on their job descriptions and background. For this group, please include an indication of what comp levels you would think about for their move to BNP Paribas. Once I get this from you, you and I can arrange for a call to talk through the info. (Declaration Of Karanveer Dhillon In Support Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Dhillon Decl.") ¶17 & Ex. E (emphasis added)) Chakravarty soon provided the confidential compensation and skills information that the BNP Paribas Defendants needed. Within just three weeks of the secret meeting, seventeen core members of the Discovery Research team resigned. Crippled by the raid, Discovery Research shut down a month later. Almost simultaneously, the BNP Paribas Defendants launched their own research business in Mumbai. Every single member of the research staff of BNP Paribas 's Mumbai research venture is a former member of Plaintiffs' Discovery Research team. B. Summary Of Argument. The BNP Paribas Defendants and Chakravarty have brought nearly identical motions to dismiss, arguing that this Court (1) lacks personal jurisdiction over BNPP Asia and Chakravarty and (2) is an inconvenient forum in which to litigate Plaintiffs' claims. Chakravarty also argues that TWP LLC lacks standing. Both motions should be denied. Jurisdiction. This Court may exercise specific jurisdiction over BNPP Asia and Chakravarty because they intentionally disrupted the Discovery Research business and knew that TWP LLC, a California company, would bear the brunt of that disruption. See Sections I(A)(2) & I(C), infra. Such "express aiming" constitutes the "purposeful availment" required for specific jurisdiction. See Sections I(A) & I(C), infra. The Court also may exercise general jurisdiction over BNPP Asia, which does substantial business with California investors--business solicited for it by at least one other
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BNP Paribas affiliate acting as BNPP Asia's general agent.

See Section I(B), infra.

Defendants also have failed to demonstrate "compellingly" that the exercise of personal jurisdiction--specific or general--would be unreasonable.

See Section I(D), infra.

Chakravarty's "standing" argument misses the mark as well: TWP LLC has standing to pursue its claims because it was directly injured by the destruction of Discovery Research.

See Section I(E), infra. Forum Non Conveniens. Defendants' forum non conveniens arguments are equally
flawed. The Bombay High Court, where this case would be tried if litigated in India, is so understaffed and plagued by delays that it does not constitute an adequate alternative forum.

See Section II(E), infra. Nor have Defendants carried their heavy burden of showing that the
balance of private and public convenience factors so favors dismissal as to outweigh Plaintiffs' traditional right to choose the forum in which to litigate.

See Section II(C), infra.

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For all these reasons, Defendants must answer in this Court for their brazen theft of Plaintiffs' trade secrets, and their destruction of the innovative research business it took Plaintiffs several years and millions of dollars to build. STATEMENT OF FACTS A. TWP LLC Is A Multinational Investment Bank Headquartered In California. Plaintiff TWP LLC is an investment bank and broker-dealer organized under the laws of Delaware and headquartered in San Francisco, California. Dhillon Decl. 112;

see also

Declaration of Michael L. Gallo In Support Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Gallo Decl.") Ex. A. TWP LLC is a wholly-owned subsidiary of Thomas Weisel Partners Group, Inc. ("TWP Group"), a publicly-traded investment bank holding company also organized under the laws of Delaware and headquartered in San Francisco. Dhillon Decl. ¶2; Gallo Dec!. Ex. A at F7. TWP LLC is the largest of several TWP Group subsidiaries, and is TWP Group's main broker-dealer. Dhillon Decl. ¶2. TWP LLC provides strategic advisory and corporate finance services to U.S. and international emerging growth companies, and equity research,
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trade execution and asset management services to wealthy individuals and institutional investors. Id. TWP LLC has offices in many cities around the globe, including the branch office in Mumbai, India that was devastated by Defendants' tortious conduct. Id. B. TWIPL Is An Indian Subsidiary And Branch Office Of TVVP LLC Created To Facilitate TWP Group's India Initiatives, Including Discovery Research. Plaintiff TWIPL, incorporated under the laws of India in August 2005, is wholly owned by TWP LLC, either directly or indirectly through a Mauritius holding company. Dhillon Dee!. Tff3, 4 & Ex. A; see also Gallo Dec1. Ex. A. TWIPL provided services to TWP LLC pursuant to an Intercompany Services Agreement ("ISA") Dhillon Decl. & Ex. C.3 TWIPL leased office space in Mumbai, India, and employed Indian nationals who worked on several different initiatives, one of which (Discovery Research) produced research reports on under-covered companies whose stocks traded on U.S. exchanges. Id. 115. In October 2005, the New York Stock Exchange ("NYSE") approved TWIPL' s Mumbai office as a branch of TWP LLC. Id. & Ex. B; see also Gallo Dee!. Ex. A at F-7. Until

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Defendants' tortious acts forced TWP Group to close it, Discovery Research was by far the largest component of TWIPL, employing more than 50 people, including 14 U.S.-licensed analysts who published research on approximately 150 different companies. 4 Dhillon Decl. 115 & Ex. B. C. Discovery Research Was Part Of TWP LLC's Integrated Research Business Operated Out Of San Francisco, California. The purpose of the Discovery Research business was to allow TWP LLC to distribute

3 The ISA provided that REDACTED 4Discovery Research was shut down in December 2007 in response to Defendants' raid. In May 2008, a second TWIPL initiative was closed down, but TWIPL continues to operate on a limited basis. Dhillon Decl. W0-21.
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research reports on a broader range of United States companies than TWP LLC previously had been able to provide. Id. ¶7. By using Discovery Research analysts based in India to analyze the companies and write research reports, TWP LLC extended coverage to smaller companies that were not cost-effective for U.S.-based analysts to cover. Id. Discovery Research operated for the benefit of TWP LLC. Pursuant to the ISA, TWIPL was paid its operating costs for Discovery Research, plus 12 percent. Id. ¶9. TWP LLC earned revenues by selling subscriptions to Discovery Research reports. Id. TWP LLC also benefited from Discovery Research's ability to broaden TWP LLC's coverage universe in other ways. Id. TWP LLC made a market in the stocks of many of the companies covered by Discovery Research, and derived revenue when its customers traded in those stocks. Id. Defendant Praveen Chakravarty, a Director of TWIPL and the head of Discovery Research's Mumbai operation, was employed by TWP LLC and registered with U.S. regulatory authorities (FINRA, the New York Stock Exchange and the State of California, for example) as an associated person of TWP LLC. Declaration of Lisa Sorani In Support

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Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Sorani Decl.") & Ex. D; Declaration of Karen Santos In Support Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Santos Decl.") & Ex. A. The Discovery Research analysts--who researched and authored the research reports that were Discovery Research's principal product--worked in Mumbai, but were functionally integrated into TWP LLC's larger research operations and subject to the same regulation and oversight as San Francisco-based TWP LLC research analysts. Dhillon Decl. 118; Sorani Decl. 117 & Exs. F, G. The Discovery Research analysts were, like Chakravarty, registered with U.S. regulatory authorities as associated persons of TWP LLC. Dhillon Decl. 115; see also Santos Decl. & Ex. B.

TWP LLC's compliance department, headquartered in San Francisco, oversaw Discovery Research employees' compliance with applicable regulations and TWP LLC
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policies. Dhillon Dee!. ¶10. San Francisco-based TWP LLC employees monitored and archived Discovery Research employees' emails, conducted compliance training for Discovery Research employees (via video conference or periodic visits to India), and periodically inspected TWIPL's Mumbai office. Id. TWP LLC personnel based in San Francisco also monitored Discovery Research employees' trades to ensure they complied with TWP LLC policies and regulatory rules. Id. One London-based TWP LLC compliance officer, whose work was overseen by management in San Francisco, assisted with some of these tasks. Id. TWP LLC was closely involved in Discovery Research coverage and ratings decisions, as well as in producing the research reports themselves. Id. ¶11. TWP LLC research managers based in San Francisco oversaw the strategic positioning of Discovery Research's product within the larger scheme of TWP LLC's research business. Id. Decisions about coverage by Discovery Research analysts, as well as ratings or price target changes, were made by a seven-person Research Review and Oversight Committee ("RROC") chaired by Keith Gay, the San Francisco-based Head of Research for TWP LLC. Id. Except for the membership of the committee, the RROC followed the exact same procedures as TWP LLC's research review and oversight committee for U.S.-based analysts. Id. The majority of the RROC were U.S.-based TWP LLC employees, three of whom were based in San Francisco. Id. Before publication of Discovery Research reports, the reports had to be approved by a Supervisory Analyst employed by TWP LLC in San Francisco to ensure compliance with regulatory requirements. Id. ¶12. Additional support was provided by Supervisory Analysts located in Baltimore and London. Id. All formal research reports written by Discovery Research analysts were edited, first in Mumbai and then by TWP LLC personnel in San Francisco or London, to ensure that the content and format met T'WP LLC standards. Id. The Discovery Research analysts' reports show that Discovery Research was an arm of TWP LLC's research operation. The research reports were copyrighted by TWP LLC, used a TWP LLC stock rating system and, in many cases, stated that TWP LLC made a market in
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the subject security.

See, e.g., Dhillon Decl. ¶13 & Ex. D. Each Discovery Research report Id.

listed its author's name and contact information, including a phone number in the San Francisco area code and an @tweisel.com email address.

REDACTED
TWP LLC sold and distributed the research reports authored by Discovery Research analysts. Declaration of Michi Sethavarangura In Support Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Sethavarangura Decl.") ¶2. TWP LLC's Institutional Sales department--based in San Francisco--sold access to Discovery Research reports on a subscription basis to institutional investors located solely in the United States.

Id. The subscription contracts were between Id. & Ex. A. TWP LLC distributed the

TWP LLC and its customers; TWIPL did not sell any Discovery Research research and was not a party to any subscription agreements.

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Discovery Research reports through a secure website that resided on servers in San Francisco and could only be accessed by subscribers. Id. ¶3. TWP LLC's Marketing department in San Francisco oversaw the website's design and processed all proposed changes. Id. Discovery Research's operations were intertwined with, and overlapped, those of TWP LLC in numerous other ways. TWP LLC's legal department, based in San Francisco and New York, handled TWIPL's legal affairs, including those related to Discovery research. Dhillon Decl. ¶14. TWP LLC personnel in San Francisco also handled some or all of TWIPL's human resources, accounting, and facilities management functions.

Id.

Substantial overlap likewise exists between TWP LLC and TWIPL's IT systems. TWIPL has no separate IT department; TWIPL's one resident IT person in Mumbai reports to TWP LLC personnel in San Francisco. Declaration Of Dheeraj Soni In Support Of

REDACTED
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Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint ("Soni Decl.") 112. The Discovery Research website was maintained and hosted by TWP LLC in San Francisco.

Id. Although a significant portion of information pertaining

to Discovery Research resided in the first instance on laptops and a server in Mumbaiwhich TWP LLC purchased for TWIPL's use--that information, and additional information, was also kept in San Francisco.

Id. The Mumbai server was networked into the TWP LLC

system and was backed up daily to TWP LLC servers in San Francisco and/or New York.

Id. Emails and internet messages generated by Discovery Research personnel in Mumbai were captured and archived by TWP LLC compliance software in San Francisco. Id.
Discovery Research employees also had access through the TWP LLC network to a drive on TWP LLC's San Francisco server with confidential information about both TWIPL and Discovery Research. Id. D. Defendant Chakravarty Was At All Times A TWP LLC Employee And The Director Of Discovery Research. On August 7, 2003, TWP LLC offered Defendant Praveen Chakravarty a position as an Equity Research Associate in its San Francisco office. Sorani Decl. & Ex. A. Chakravarty accepted that offer.

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Id. Chakravarty is an Indian citizen and was employed in San Francisco until early October 2005. Id. ¶3. As a condition of his employment,

Chakravarty agreed to protect TWP LLC's confidential information, to not solicit its employees, and to not use his position or TWP LLC's confidential information for his personal gain or to compete with TWP LLC. Id. & Exs. B, C. In October 2005, TWP LLC assigned Chakravarty to TWIPL, in Mumbai to take the lead management role in building up and running the research side of Discovery Research. Dhillon Decl. ¶15; Sorani Decl. & Ex. D. Until his termination on November 7, 2007, Chakravarty remained an employee of TWP LLC, whose employment terms he and TWP LLC agreed would be governed by "the laws of the US and [TWP LLC rules and

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Id. In Mumbai, Chakravarty reported to Karanveer ("KY") Dhillon, the Managing Director of TWIPL (but not a TWIPL employee). Id. ¶5. As part of his
regulations]."
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international assignment, Chalcravarty was named "Director of Discovery Research" and received a raise and significant benefits, including a guaranteed bonus, an equity award and a substantial housing allowance. Sorani Decl. & Ex. D.

As Director of Discovery Research, Chakravarty had access to most if not all confidential information about Discovery Research. Dhillon Decl. ¶16. Using the shared TWP LLC/TWIPL computer system, Chakravarty received and/or reviewed documents showing employee compensation levels, current and projected profit and loss statements, and other financial planning documents. Id. Chakravarty also was involved intimately with the research at the core of the Discovery Research business and, as a result, had access to research reports, information about coverage decisions, contact information for the companies the Discovery Research team covered, training materials, and knowledge about the research analysts and associates themselves. Id. Chakravarty also had access to confidential customer information about Discovery Research subscribers. Id. E. Defendant BNPP Asia Is Part Of The BNP Paribas Global Banking And Securities Trading Network And, As Such, Does Substantial Business With California Investors. 1. BNP Paribas's Global Network Of Companies Operates As A Seamless Integrated System. BNPP Asia is part of the BNP Paribas Group, a network of interrelated companies centered on BNP Paribas, parent of BNPP Asia and a codefendant in this lawsuit. BNP Paribas is an international retail and investment bank headquartered in France with a presence in more than 85 countries and close to 140,000 employees worldwide. Gallo Decl. Ex. B at 2. BNP Paribas has substantial operations in the United States, including a regional office in San Francisco, and has a designated officer for service of process in California. Id., Ex. C.

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REDACTED
BNP Paribas does not dispute that it is subject to jurisdiction in the

Northern District of California. BNP Paribas markets itself as an "international banking network," with regional
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subsidiaries and affiliates in 85 countries that can offer customers investment opportunities around the globe. Id., Ex. E. This network is promoted as an integrated system, providing customers a seamless international banking experience. For clients who need international securities services, BNP Paribas's website touts its ability to provide "global execution services" to investors and describes global execution as "the answer" for financial institutions easily to carry out complicated international securities transactions: We provide clients with a fully-integrated solution covering both the execution of a trade order and the associated clearing, settlement and custody-related tasks. Our market coverage includes easy access to dozens of exchanges worldwide, so clients just send us their initial trade instructions--and we handle the rest. (Id., Ex. F) Acting through its network of regional offices and subsidiaries, BNP Paribas thus offers

12 customers direct access to securities markets--including the ability to order trades of
HOWARD RICE 4EMEROVSKI CANADY FALKR.ABKIN

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equities and structured derivatives--on more than 50 exchanges around the world. Id. BNP Paribas also uses its network of regional offices and subsidiaries to conduct

15 research into securities traded on exchanges throughout the world. This research is then sold 16 or distributed to BNP Paribas Group's customers around the world. Most research 17 operations are managed through a network of subsidiaries operating under the BNP Paribas 18 19 20 In India, BNP Paribas, acting through BNPP Asia, created a Mumbai-based research 21 22 23 24 25 26 27 28 team's research reports are branded and marketed abroad as a product of "a member company of the BNP Paribas Group." See, e.g., id., Ex. G at 27.6 team, comprised primarily, if not entirely, of former Discovery Research employees, to investigate and analyze the stocks of Indian public companies. Dhillon Decl. ¶22. The India Personal Investors business line, which is "dedicated to providing financial advice to a massaffluent clientele in Europe and several emerging countries. . . . " Id., Ex. G at 2.

REDACTED
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2. BNPP Asia Operates As An Integral Part Of The BNP Paribas Group By Executing Trades On Asian Markets For BNP Paribas Customers Worldwide.
Based in Hong Kong, Defendant BNPP Asia is an integral part of BNP Paribas's

global system of investment services for customers of the BNP Paribas Group, including investors located in California. BNP Paribas's 2006 annual report describes Defendant BNPP Asia's "integrated Asian equity brokerage solution": Since its recent integration into Equities and Derivatives, BNP Paribas Securities Asia has offered its institutional clients a comprehensive range of research, execution, and distribution services in Asian equity products and their derivatives. Based in Hong Kong, the BNP Paribas Securities Asia teams are present on all Asian markets, particularly in China, Japan, India, Korea, Taiwan and South-East Asia (Singapore, Indonesia, Malaysia and Thailand). In total, over 250 professionals are active on the secondary markets as well as in providing a distribution platform for the primary market and equity derivatives. BNP Paribas Securities Asia also has sales teams in the United States (New York and San Francisco) and iurope (London, Paris and Milan). (Gallo Decl. Ex. H at 29-30 (emphasis added))' The BNP Paribas website describes BNPP Asia as a "pioneer in Asian equities brokerage" that is tied to BNP Paribas and "part of the Group's Equity Derivatives division." Id., Ex. I. The website touts BNPP Asia's "comprehensive" range of equities trading solutions for institutional investors, its equity research capacities in "nine of Asia's most active economies . . . [including] India," its advanced trading and execution platform and its "exclusive franchise" with BNP Paribas's Corporate Finance Asia Pacific division. Id. The website refers investors to their BNP Paribas Group sales representatives, or to the BNP Paribas website, for further information on BNPP Asia's offerings. Id. Thus, as the BNP Paribas Defendants' own materials show, BNPP Asia offers a wide range of services related to Asian markets to clients of the BNP Paribas Group throughout the world, including California, where those customers have been serviced by a sales team located in San Francisco.8 7 BNPP Asia has been "part of the [BNP Paribas] Group's Equity Derivatives division" since September 2006. Id.
REDACTED
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Mnlealonal Cmprwer.

The management structure of BNPP Asia further reveals the depth of its integration into the larger BNP Paribas Group. Pierre Rousseau, one of the principal architects of the raid on Discovery Research, is both the Chief Executive Officer of BNPP Asia and the Global Head of Equity Brokerage for BNP Paribas, and reports directly to Yann Gerardin, Global Head of Equities and Derivatives for BNP Paribas. Id., Exs. A, J at 2. 3. BNPP Asia Serves BNP Paribas Clients In California By Executing Trades Worth Well More Than $100 Million.

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Id. Since providing BNPP Asia's interrogatory responses, the BNP Paribas Defendants have claimed that the information provided in BNPP Asia's responses overstates the commissions received for transactions executed for California investors. Gallo Decl. Ex. 0. However, the BNP Paribas Defendants have not provided Plaintiffs with a revised number or any estimate of the amount by which their original number is off Id.
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20 21 22 23 24 25 26 27 28 "NASD rules provide for a maximum commission rate of 5%, absent special circumstances. Mahon Decl. ¶3. In practice, commissions are rarely if ever that high. Id. ¶3-4.
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F. BNPP Asia And Chakravarty's Illegal Raid On Discovery Research Destroyed That Business And Harmed TWP LLC. In mid-October 2007, Chakravarty, acting without TWP LLC and TWIPL's authority, met in Mumbai with Pierre Rousseau (BNP Paribas' Global Head of Equity Brokerage and a Director and Chief Executive Officer of BNPP Asia) and Jonathan Harris (BNPP Asia's Regional Head of Company Research). Gallo Decl. Ex. J at 2, 3. As Harris's October 15 email summary of the meeting attests, Rousseau, Harris and Chakravarty planned to solicit Discovery Research employees to "resign from Thomas Weisel enmass (sic)." Dhillon Decl. Ex. E. In furtherance of their scheme, the BNP Paribas Defendants asked Chakravarty to provide confidential information about the qualifications, expertise and compensation of a targeted group of more that twenty Discovery Research professionals. See, e.g., id. (asking Chakravarty to provide "current comp," "job descriptions," "background," and "an indication of what comp levels you would think about for their move to BNP Paribas" for "the core group of your team. . . about 20-25 individuals").

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A password-encrypted spreadsheet discovered on Chakravarty's TWP-issued laptop contains precisely the information Harris requested--Discovery Research employees' (1) 2007 base and bonus compensation, (2) 2008 expected TWP base compensation, (3) sector coverage, (4) years of experience, (5) educational background and (6) 2008 "proposed" base and bonus compensation, including a signing bonus. Dhillon Decl. ¶18 & Ex. F; see also Declaration of Laurel Sutcliffe In Support Of Plaintiffs' Consolidated Opposition To Defendants' Motions To Dismiss The First Amended Complaint Sutcliffe ("Sutcliffe Decl.") 17-10 & Exs. A & B (discussing password protection). The spreadsheet also contains salary and bonus information for Chakravarty and a "purchase price" analysis. Id. Another worksheet in that same encrypted document contains a schedule for interviews with individual Discovery Research analysts on October 25 and 26, 2007, approximately ten days after Harris's email and just a few days before the analysts began to give notice. Id. A third worksheet contains a timeline for the defection of Discovery Research analysts. Id. These documents show that Chakravarty and the BNP Paribas Defendants used TWP LLC's confidential information actively to solicit TWIPL employees to quit en masse and jump ship to BNPP Asia's India business. 13 And the employees responded. Between October 31 and November 6, 2007, seventeen Discovery Research employees gave notice-- including ten of Discovery Research's fourteen FINRA-licensed research analysts and seven research associates. Dhillon Decl. ¶19. 14 Of the four remaining research analysts, three had only been licensed for a few months. Id. Chakravarty would also have resigned if he had not first been terminated for cause on November 7, 2008, after TWP LLC discovered his 13 Plaintiffs are informed and believe that Chakravarty provided, or instructed others to provide, other confidential information to the BNP Paribas Defendants--including business plans and lists of customer contacts. Because merits discovery has not yet commenced, Plaintiffs have not yet been able to confirm this. Plaintiffs also know Chakravarty traveled to Hong Kong during the time the analysts were resigning, and believe he did so specifically to deliver to the BNP Paribas Defendants confidential information related to Discovery Research and to plot and scheme to destroy Discovery Research. 14 In addition to the seventeen research professionals who resigned, TWIPL's human resources generalist, who was later discovered to be materially assisting Chakravarty, quit on November 7. Dhillon Decl. ¶19.
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conspiracy with the BNP Paribas Defendants. Id. Defendants' orchestration of the mass defection of key employees destroyed the Discovery Research business. Due to the simultaneous departure of most of its licensed analysts, Discovery Research could not produce timely research reports on many of the stocks it covered. Id. ¶20. Despite intensive efforts over several weeks to salvage the damaged business--including exploring efforts to quickly recruit, hire, train and license new research analysts--TWP LLC management concluded reluctantly that the loss of talent rendered Discovery Research unable to provide research coverage of a quality and scope that TWP LLC's subscribers demanded (and had paid for). Id. As a result, on December 6, 2007, TWP Group announced that Defendants' actions had forced the shutdown of Discovery Research. Id.; see also Gallo Decl. Ex. K. The closure of Discovery Research deprived TWP LLC of current and future revenue from the sale of subscriptions and from trading in stocks covered by Discovery Research. Dhillon Decl. ¶20. The BNP Paribas Defendants contemplated, and indeed hoped for, this sequence of events. Harris's October 15 email to Chakravarty describes BNP Paribas's willingness to

13

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take over TWP LLC's Mumbai office if the mass resignations led to a decision to shut down operations: Once you have [formal offers for the research team] . .. we'd look to you to resign from Thomas Weisel enmass. If their reaction is that they'd move to shut down the remainder of the office, we can step in and offer to take over the remainder as a gesture to save them the office shutdown costs. (Id., Ex. E) Chalcravarty's timetable for the team's defection to BNP Paribas includes a date (after the dates on which team members were expected to resign) for "TWP's decision on real estate" (id., Ex. F)--an apparent acknowledgement that TWP LLC would have little reason to keep Discovery Research open once virtually all its qualified analysts were gone. The BNP Paribas Defendants have created their own venture with the research team poached from Discovery Research. A December 4, 2007 BNP Paribas press release entitled "BNP Paribas Securities Asia Launches Onshore Research Platform in India" describes the creation of a 27-person securities research team in India under the leadership of Chakravarty.
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Gallo Decl. Ex. L. According to the release, the new India research team will "complete BNP Paribas Securities Asia's regional research footprint," and "with the new setup boasting 10 writing analysts and 13 research associates by the end of year, BNP Paribas Securities Asia will see its India securities capabilities significantly boosted." This "boost" comes at Plaintiffs' expense. Indeed, all the people who comprise BNPP Asia's new India research venture are former Discovery Research professionals. 15 Id. ARGUMENT I. THE COURT HAS JURISDICTION OVER THIS DISPUTE. Defendant BNP Paribas does not contest this Court's jurisdiction. Defendants BNPP Asia and Chalcravarty oppose jurisdiction primarily on the ground that they have no physical presences in California. As we show below, these arguments are insufficient. The facts in this case establish that these defendants are subject to jurisdiction (1) under the "express aiming theory" and (2) because BNPP Asia provides, on a continuous basis, execution services to California investors on trades worth hundreds of millions of dollars annually. A. BNPP Asia Purposefully Availed Itself Of This Court's Specific Jurisdiction By Conspiring With Chakravarty To Commit Wrongful Acts Against TWP LLC, A Known California Resident. 1. Legal Standard. A defendant without a physical presence in a state can subject itself to specific jurisdiction in that state through "express aiming"--the "purposeful direction of a foreign act having an effect in the forum state." CE Distribution, LLC v. New Sensor Corp., 380 F.3d 1107, 1111 (9th Cir. 2004) (quoting citation omitted). The "express aiming" requirement is met "when the defendant is alleged to have engaged in wrongful conduct targeted at a Plaintiffs have obtained a March 13, 2008 research report authored by one of the former Discovery Research analysts, Vijay Sarathi. Dhillon Decl. ¶22 & Ex. G. The report lists Sarathi's employer as "BNP Paribas India Solutions Pvt Ltd" ("BNPP India"), which is described as a "member company of the BNP Paribas Group." Id. at 1, 27. The report lists twenty-one members of BNPP India's "India Research Team"--every single one of whom is a former Discovery Research employee. Id. 1122. BNPP India's research team is headed by Chalcravarty, and comprised of the seventeen research analysts and associates who left Discovery Research en masse between October 31 and November 6, plus three other Discovery Research research associates who left subsequently. Id. ¶22 & Ex. G at 24.
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plaintiff whom the defendant knows to be a resident of the forum state." Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 223 F.3d 1082, 1087 (9th Cir. 2000); Panavision Int'l, L.P. v. Toeppen, 141 F.3d 1316, 1321 (9th Cir. 1998). Under the Ninth Circuit's express aiming test, a plaintiff need not allege that the harm was directed at the forum state itself. The harm is jurisdictionally sufficient if aimed at a resident of the forum state, even when the actions causing the harm occurred outside the forum. Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122 (9th Cir. 2003) (personal jurisdiction existed over British company that allegedly interfered with a California company's business operations in Europe). The harm need not be felt only in the forum state. A majority of the harm may be felt elsewhere, so long as the defendant knows the plaintiff will suffer some harm in the forum state. Yahoo! Inc. v. La Ligue Contre Le Racisme et L'Antisemitisme, 433 F.3d 1199, 1207 (9th Cir. 2006) (en bane) ("[T]he 'brunt' of the harm need not be suffered in the forum state. If a jurisdictionally sufficient amount of harm is suffered in the forum state, it does not matter that even more harm might have been suffered in another state."). 2. BNPP Asia's Raid On Discovery Research Was Expressly Aimed At TWP LLC. By wrongfully acquiring confidential information about Discovery Research and its professionals and using that information to lure away Discovery Research's trained analysts, BNPP Asia disrupted the flow of research reports from Mumbai to TWP LLC in California--ultimately causing the destruction of TWP LLC's entire Discovery Research initiative. In so doing, BNPP Asia deliberately harmed a known California resident and purposefully availed itself of this Court's jurisdiction. TWIPL and Discovery Research's close ties to TWP LLC were readily apparent to BNPP Asia. TWP Group's public filings state that TWIPL was both a subsidiary and NYSE-approved branch of TWP LLC. See, e.g., Gallo Decl. Ex A. The Discovery Research analysts, including Chakravarty, were registered as associated persons of TWP LLC with FINRA and other U.S. regulatory authorities. This information, too, was publicly
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available at the FINRA website. Chakravarty, BNPP Asia's "inside man," was a TWP LLC employee throughout his tenure at Discovery Research. BNPP Asia officials, including Rousseau and Harris, undoubtedly knew of the connection between Discovery Research and TWP LLC, as did their co-conspirator Chakravarty. Their recognition of the connection is on display in Harris's October 15 email to Chakravarty, which envisions that Discovery Research personnel will "resign from Thomas Weisel enmass." Dhillon Decl. Ex. E (emphasis added). Harris makes no distinction between the Indian subsidiary and the California-based parent company. That the harm has befallen a California plaintiff is equally clear. As set forth in the Statement of Facts, Section C, supra, Discovery Research's operations were intertwined inextricably with TWP LLC in San Francisco and were operated for TWP LLC's benefit. Discovery Research served as an offshore manufacturing facility whose "product"--research reports on under-covered U.S. companies--was supplied to TWP LLC according to its specifications so that TWP LLC could package, market and sell it. TWP LLC personnel based primarily in San Francisco decided which companies to research, supervised the analysis, and sold and distributed the reports on a subscription basis. Investors' subscription agreements and payment arrangements were with TWP LLC, not TWIPL; TWP LLC stood to receive any revenue and profit from the subscription agreements over and above TWIPL's operating costs plus twelve percent.16 Having targeted a California company, it is legally beside the point that BNPP Asia's wrongful acts occurred in Asia. Harris Rutsky, 328 F.3d at 1131 (personal jurisdiction upheld based on express aiming into California when defendant targeted resident corporation with wrongful acts performed in London); see also, e.g., Integral Development Corp. v.

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16 The BNP Paribas Defendants mischaracterize this lawsuit as "essentially an employment dispute involving Indian employees who are employed in India" (BNP Paribas and BNP Paribas Securities Mot. to Dismiss First Am. Compl. ("BNPP Mot") at 13)--an argument that glosses over BNPP Asia's own Hong Kong citizenship and connection to a worldwide bank, and ignores altogether the California citizenship of the principal plaintiff, TWP LLC.
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Weissenbach, 99 Cal. App. 4th 576, 587 (2002) (misappropriation of trade secrets by German national managing German subsidiary of California company and use of that information to injure California company supported exercise of personal jurisdiction under express aiming theory). A primary justification for the "express aiming" doctrine is to prevent a state's residents from having to travel to sue out-of-state wrongdoers who target those residents from afar. Calder v. Jones, 465 U.S. 783, 790 (1984) ("An individual injured in California need not go to Florida to seek redress from persons who, though remaining in Florida, knowingly cause the injury in California"). The knowing targeting and the harm are the keys--and both are present here. B. General Jurisdiction Exists Over BNPP Asia Which Provides Substantial, Continuous And Systematic Services To California Investors Through Other BNP Paribas Affiliates That Have Substantial California Contacts. 1. A Foreign Defendant With Minimal Direct Contact With A Forum Nonetheless May Be Subject To General Jurisdiction If It Uses A General Agent For Business Within That Forum. A court may exercise general jurisdiction over a non-resident defendant with substantial, continuous and systematic contacts with the forum. BNPP Asia unquestionably conducts substantial business that originates in California.

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REDACTED
These contacts alone are substantial enough to warrant general jurisdiction. Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163 (general jurisdiction existed over company doing hundreds of millions of dollars of business in state).

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An out-of-state entity may be subject to general jurisdiction through the conduct of a
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"general agent" used to conduct business within the forum. Harris Rutsky, 328 F.3d at 1134-35. An in-forum entity serves as a foreign defendant's "general agent" by performing services in the forum that it "would have to undertake" itself if the foreign defendant "did not have a representative to perform them." Id. at 1135 (internal citation omitted). The general agent's contacts with the forum are imputed to the foreign defendant, so that jurisdiction over the agent also creates jurisdiction--either specific or general, depending on the nature of the contacts--over the foreign defendant. /d.17 Affiliates operate as each other's agents in different states or countries if they depend on each other's foreign operations to produce a single integrated product. In such situations, the out-of-state entity, but for the existence of the in-forum affiliate acting as its general agent, either would have to forego operating in the forum or create its own contacts with the forum. In Palmieri v. Estefan, 793 F. Supp. 1182 (S.D. N.Y. 1992), for example, the court held that general jurisdiction existed in New York over a network of thirty-three foreign subsidiaries of New York-based Sony Music. Id. at 1187-94. The subsidiaries used their New York parent as a conduit for new products (music recordings made in New York) and as a central clearing house to swap recording rights. Id. at 1185-86. The subsidiaries were subject to jurisdiction based on the New York contacts of Sony Music because "when two corporations have common ownership and their activities are interrelated as here, they may 170ther jurisdictions have also adopted the general agency theory of jurisdiction. See, e.g., Dainippon Screen Mfg. Co., Ltd. v. CFMT, Inc., 142 F.3d 1266, 1270-71 (Fed. Cir. 1998) (upholding jurisdiction over foreign subsidiary company based on parent's contacts in forum); Mangual v. Gen. Battery Corp., 710 F.2d 15, 20-21 (1st Cir. 1983) (upholding jurisdiction over foreign parent corporation based both on individual agent's tortious conduct in forum and fact that parent shared office space with in-forum subsidiary); Shanks v. Westland Equip. & Parts Co., 668 F.2d 1165, 1166-68 (10th Cir. 1982) (upholding jurisdiction over foreign trailer manufacturer based on in-state affiliate's frequent use of foreign manufacturer's trailers in the state); Palmieri v. Estefan, 793 F. Supp. 1182, 1187-94 (S.D.N.Y. 1992) (upholding general jurisdiction over foreign subsidiary when in-state parent acted as agent); Brunswick Corp. v. Suzuki Motor Co. Ltd., 575 F. Supp. 1412, 1421-23 (E.D. Wis. 1983) (holding that Wisconsin agent's contacts could subject foreign corporate affiliates to general jurisdiction when the foreign affiliates had "systematically injected themselves into the Wisconsin market place" through the acts of their Wisconsin agents); Orefice v. Laurelview Convalescent Ctr., Inc., 66 F.R.D. 136, 139-42 (E.D. Pa. 1975) (jurisdiction over foreign subsidiary appropriate when parent acted as in-forum agent, even where parent's forum contacts had nothing to do with subject matter of suit).
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have an agency relationship for jurisdictional purposes, even if the resident corporation is not controlled by the nonresident entity." Id. at 1194. In Freeman v. Gordon & Breach, ScL Publishers, 398 F. Supp. 519, 520-522 (S.D.N.Y. 1975), a New York district court asserted jurisdiction over a foreign company based on the contacts of its New York affiliate. The two commonly owned corporate affiliates, although distinct corporate entities, acted as "one commonly owned enterprise . . . which, in order to function, must rely upon the joint endeavors of each constituent part." Id. As these cases indicate, the agent need not be a subsidiary of the foreign business entity. It can be above the foreign entity on the corporate ladder. Thus, a resident parent can be a foreign subsidiary's local agent even though the subsidiary is often the smaller entity and lacks "control" over the parent's acts. Dainippon Screen Mfg. Co. v. CFM'T, Inc., 142 F.3d 1266, 1271 (Fed. Cir. 1998) (parent could be in-forum agent of subsidiary); Shanks, 668 F.2d at 1166-68 (sister company as agent); Palmieri, 793 F. Supp. at 1187-94 (parent as agent); Jayne v. Royal Jordanian Airlines Corp., 502 F. Supp. 848, 856-60 (C.D. N.Y. 1980) (same); Energy Reserves Group, Inc. v. Superior Oil Co., 460 F. Supp. 483, 513-15 (C.D. Kan. 1978) (same); Orefice, 66 F.R.D. at 141 (same); Freeman, 398 F. Supp. at 520-22 (S.D. N.Y. 1975) (same). 2. BNP Paribas Affiliate BNPP Securities Corp. Serves As BNPP Asia's California Agent Because It Performs Functions In California That BNPP Asia Otherwise Would Have To Perform For Itself.

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3. General Jurisdiction Exists Because The California Contacts That Can Be Imputed To BNPP Asia Are Substantial, Continuous, And Systematic.

REDACTED

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Such substantial contact with California is more than enough to invest this court with general jurisdiction over BNPP Asia. C. This Court Has Specific Jurisdiction Over Chakravarty Because He Was A TWP LLC Employee At The Time Of The Conspiracy And Knew That Raiding Discovery Research Would Injure TWP LLC In California. Chakravarty is subject to this Court's specific jurisdiction for the same reasons described above. As a Director of Discovery Research with intimate understanding of its business model, Chalcravarty facilitated the BNP Paribas Defendants' raid on Discovery Research and understood that gutting Discovery Research would injure TWP LLC in San
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Filed 07/10/2008

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Francisco. When he conspired with the BNP Paribas Defendants, Chakravarty remained an employee of TWP LLC and knew his own departure would harm TWP LLC. He, like his co-conspirators, "expressly aimed" his wrongful conduct at his California-based employer. By virtue of his employment agreements with TWP LLC--including his agreements not to disclose confidential information and not to use company resources to his own advantage--Chalcravarty also remained in contractual privity with TWP LLC, a California company, until he was terminated for his part in the raid. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 479-80 (1985) (minimum contacts existed over party that entered into contract with substantial connections with forum state). See also, e.g., Integral Development Corp., 99 Cal. App. 4th at 589-90 (2002) (minimum contacts existed over a German national who entered into an employment agreement with a California company to manage its German subsidiary). D. Jurisdiction Over BNPP Asia And Chakravarty Is Reasonable And Necessary For The Furtherance Of Justice. Reasonableness and justice require that this Court exercise jurisdiction over BNPP Asia and Chakravarty for two independent reasons: (1) BNPP Asia and Chakravarty knowingly caused the destruction of San Francisco-based TWP LLC's Discovery Research initiative; and (2) BNPP Asia maintained substantial contacts with California through its general agent. The Ninth Circuit balances seven factors to decide whether jurisdiction is reasonable: (1) the extent of the defendants' purposeful injection into the forum state's affairs; (2) the burden on the defendant of defending in the forum; (3) the extent of conflict with the sovereignty of the defendant's state; (4) the forum state's interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiff's interest in convenient and effective relief; and (7) the existence of an alternative forum. (Dole Food Co., Inc. v. Watts, 303 F.3d 1104, 1114 (9th Cir. 2002)) The burden is on Defendants to demonstrate in "compelling" fashion that the seven factors weigh heavily against the exercise of jurisdiction here. Burger King, 471 U.S. at 477. If the question is close, a court cannot decline to exercise jurisdiction for lack of reasonableness. See Roth v. Garcia Marquez, 942 F.2d 617, 625 (9th Cir. 1991) (exercise of personal
OPP. TO DEFS.' MOT. TO DISMISS FIRST AM. COMPL. C-07-6198 MHP

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HOWARD RICE AEMEROVSKI CANADY FALK RABKIN
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Case 3:07-cv-06198-MHP

Document 48

Filed 07/10/2008

Page 32 of 45

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HOWARD RICE ,IEMEROVSKI CANADY FAL( I Eri RAI3KIN
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jurisdiction was reasonable even though only two of seven reasonableness factors favored plaintiff while three favored defendants; even though the defendants may have been "able to show that the exercise of jurisdiction might be unreasonable," the "closeness of the question manifests that they cannot do so in a compelling fashion"). The present case is not close; the reasonableness factors weigh heavily in favor of jurisdiction in California. 1. The Purposeful Injection Factor Weighs Strongly In Favor Of Jurisdiction Because BNPP Asia And Chakravarty Expressly Aimed Wrongful Conduct At TWP LLC.

BNPP Asia deliberately injected itself into this forum by establishing substantial contacts with California through its corporate affiliates. More importantly, both BNPP Asia and Chakravarty expressly aimed their wrongful conduct into California. The fact that BNPP Asia and Chakravarty aimed wrongful conduct at TWP LLC "knowing that [this conduct] would likely injure [TWP LLC] in California" is sufficient to tip the purposeful injection factor "strongly in plaintiff's favor." Dole, 303 F.3d at 1115 (internal citation and quotation marks omitted). See also, e.g., Integral Development Corp., 99 Cal. App. 4th at 588 (German national's alleged misappropriation of trade secrets from California company and alleged use of that information to injure California company constituted tortious conduct aimed at a California plaintiff and provided a reasonable basis for the assertion of jurisdiction). 2. Defendants Have Not Shown That Defending This Lawsuit In California Would Be Unduly Burdensome.

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The burden on Defendants is not a significant factor. Unless inconvenience to the defendant "is so great as to constitute a deprivation of due process, it will not overcome clear justifications for the exercise of jurisdiction." Roth, 942 F.2d at 623 (internal quotation marks omitted). While litigating in Californi