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Ogner v. Kilohana

United States District Court, D. Hawaii

November 29, 2017

IRVING OGNER, Plaintiff,
M/V KILOHANA, O.N. 1208577, her engines, machinery, furniture, equipment, and appurtenances, In Rem; and DAVID E. THOMAS, In Personam; Defendants.


          J. Michael Seabright, Chief United States District Judge


         Before the court is Defendant David E. Thomas' (“Thomas”) Motion to Dismiss Plaintiff Irving Ogner's (“Ogner”) First Amended Verified Complaint (“FAC”), ECF No. 10, for lack of subject-matter jurisdiction. ECF No. 20. For the reasons discussed below, the court finds that it has admiralty jurisdiction over this action and therefore DENIES the Motion to Dismiss.


         A. Factual Background

         As alleged in the FAC, Ogner, Thomas, and Johnny Antoon (“Antoon”) entered into an oral agreement (the “Agreement”) in 2007 to form a partnership to acquire, maintain, and use the M/V Kilohana, O.N. 1208577, a United States Coast Guard documented vessel (the “Vessel”). FAC ¶ 7. Pursuant to the Agreement, the partners would each own a one-third interest in the Vessel and be responsible for one-third of the expenses for maintaining, insuring, and mooring the Vessel. Id. The Vessel was initially moored in Florida where Antoon resided. Id. Antoon withdrew from the partnership in 2010, id., and on May 7, 2010, title to the Vessel was recorded in the name of “Irving Ogner and David E. Thomas, JTRS.” FAC Ex. “A” at 3, ECF No. 10-2. The parties now dispute their percentage ownership interest in the Vessel. FAC ¶ 11.

         In 2010 Thomas borrowed approximately $200, 000, using the Vessel as collateral, to prepare and ship the Vessel to Hawaii. Id. ¶ 9. The parties further dispute whether Thomas or the partnership is responsible for the costs of shipping and maintaining the Vessel in Hawaii. To convince Ogner to allow the Vessel to be shipped to Hawaii, Thomas agreed to be solely responsible for shipping costs and all future costs of maintaining, insuring, and mooring the Vessel, which he would and did use as a residence in Hawaii. Id. ¶ 10. Thomas now contends that costs for shipping and maintenance are the responsibility of the partnership and that he is owed approximately $145, 715.46. Id. The current market value of the Vessel is estimated to be $208, 000. Id. ¶ 14.

         The parties' disagreement over the management, use, and buyout or sale of the Vessel is irreconcilable. Id. ¶ 12. Thus, Ogner filed the instant action for partition pursuant to Rule D of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions, for sale of the Vessel, and for an accounting. Id. ¶¶ 15-19. Ogner seeks the sale of the Vessel, an award of sale proceeds in proportion to his ownership interest, reimbursement from sale proceeds for costs incurred with the Vessel's arrest and custody, an injunction requiring Thomas to disclose the partnership's financial records, and distribution of partnership assets pursuant to the Agreement. Id. ¶¶ E-H.

         B. Procedural Background

         Ogner filed a Verified Complaint against the Vessel, in rem, and Thomas, in personam, on July 21, 2017, ECF No. 1, and the FAC on August 1, 2017, ECF No. 10. On August 2, 2017, the court issued a Warrant for Maritime Arrest of the Vessel, ECF No. 15, and an Order Appointing Substitute Custodian, ECF No. 16. The Warrant was served and the Vessel taken into custody on August 9, 2017. ECF No. 17. On August 23, 2017, Thomas filed a Verified Statement of Interest for the in rem Defendant Vessel. ECF No. 19. On August 30, 2017, Thomas filed the instant Motion to Dismiss for lack of subject-matter jurisdiction. ECF No. 20. Ogner filed an Opposition on November 8, 2017, ECF No. 31, to which Thomas did not file a Reply. The Motion was heard on November 29, 2017.


         Federal Rule of Civil Procedure 12(b)(1) authorizes a court to dismiss claims over which it lacks subject-matter jurisdiction. The court may determine jurisdiction under Rule 12(b)(1) so long as “the jurisdictional issue is [not] inextricable from the merits of a case.” Kingman Reef Atoll Invs., L.L.C. v. United States, 541 F.3d 1189, 1195 (9th Cir. 2008). The moving party “should prevail [on a Rule 12(b)(1) motion to dismiss] only if the material jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of law.” Casumpang v. Int'l Longshoremen's & Warehousemen's Union, Local 142, 269 F.3d 1042, 1060-61 (9th Cir. 2001) (citation and quotation marks omitted); Tosco Corp. v. Cmtys. for a Better Env't, 236 F.3d 495, 499 (9th Cir. 2001), abrogated on other grounds by Hertz Corp. v. Friend, 559 U.S. 77 (2010).

         A Rule 12(b)(1) challenge may be either facial or factual. Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). In a facial attack, the court may dismiss a complaint when the allegations of and documents attached to the complaint are insufficient to invoke subject-matter jurisdiction. See Savage v. Glendale Union High Sch. Dist. No. 205, 343 F.3d 1036, 1039 n.2 (9th Cir. 2003). When the jurisdictional challenge is facial, all allegations of material fact are taken as true and construed in the light most favorable to the nonmoving party. Fed'n of African Am. Contractors v. City of Oakland, 96 F.3d 1204, 1207 (9th Cir. 1996). This presumption of truthfulness does not extend to legal conclusions, “even if cast in the form of factual allegations.” Lacano Invs., LLC v. Balash, 765 F.3d 1068, 1071 (9th Cir. 2014) (quotation and citation omitted).

         In a factual attack, the challenger “disputes the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction.” Safe Air for Everyone, 373 F.3d at 1039. When determining a factual attack, the court “relies on affidavits or any other evidence properly before [it] to contest the truth of the complaint's allegations.” Courthouse News Serv. v. Planet, 750 F.3d 776, 780 (9th Cir. 2014) (internal quotation marks, brackets, and citation omitted). “Once the moving party has converted the motion to dismiss into a factual motion by presenting affidavits or other evidence properly brought before the court, the party opposing the ...

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