Reid v. Siniscalchi, C.A. No. 2874-VCN (November 20, 2014)

The Court denied a motion to dismiss a suit against an Italian company and two Italian citizens. The dispute involved a Delaware limited liability company formed to take commercial advantage of Russian satellite orbital slots. The plaintiff alleged that the Italian company and the two individual defendants conspired to misappropriate the business opportunities of the LLC. The Court held the plaintiff pleaded sufficient facts to satisfy the five-part test required to establish personal jurisdiction based on conspiracy theory. The opinion noted, however, that at the motion to dismiss stage, all inferences must be drawn in favor of the plaintiff. The five-part test was taken from Istituto Bancario Italiano SpA v. Hunter Eng’g Co., 449 A.2d 210, 222 (Del. 1982). The Court found the plaintiff sufficiently alleged, first, that a conspiracy to defraud existed because he presented circumstantial evidence that two or more people had a meeting of the minds in pursuit of a goal, and that their actions included an unlawful act that damaged the plaintiff. In this case the unlawful act was the formation of the Delaware holding company that acquired the LLC and thereby took control of it. The plaintiff also sufficiently alleged that: Second, all defendants were members of that conspiracy because it could be inferred that the conspiracy served their interests; third, that the formation of the holding company was a substantial act in furtherance of the conspiracy that occurred in the forum state; fourth, the Italian entity knew or had reason to know about the formation of the holding company; and fifth, the act in the forum state was a direct and foreseeable result of the conduct in furtherance of the conspiracy because the formation of the holding company was an intentional act.