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January 31, 1997


The opinion of the court was delivered by: BRODERICK

 Broderick, J.

 January 31, 1997

 Presently before the Court are the motions of three defendants who are residents of the United Kingdom to dismiss Plaintiff's complaint pursuant to Fed. R. Civ. P. 12(b)(1), 12(b)(2), 12(b)(5), and 12(b)(6), as well as on the grounds of forum non conveniens. The moving defendants are the United Medical and Dental Schools of Guy's and St. Thomas's Hospitals (hereinafter "UMDS" or "the Schools"), Dr. Mary Dyson, and Hugh Lewis (hereinafter collectively the "UMDS Defendants").

 The UMDS Defendants move to dismiss under Rule 12(b)(1) on the grounds that the Schools, and also the individuals acting in the scope of their employment with the Schools, are immune from suit as agencies or instrumentalities of the United Kingdom pursuant to the Foreign Sovereign Immunities Act, 28 U.S.C. §§ 1602 et seq.; under Rule 12(b)(2) on the grounds that the Court may not exercise personal jurisdiction over them; under Rule 12(b)(5) on the grounds that Plaintiff violated the Hague Convention in effectuating service of process; under Rule 12(b)(6) for the reasons set forth in the motion of defendants James R. McGonigle and Longport, Inc., filed on June 19, 1996; and finally, on the grounds of forum non conveniens.

 After permitting the parties roughly three months to conduct limited discovery into the jurisdictional issues raised by the UMDS Defendants' motions, and upon considering the parties' legal memoranda, affidavits, and oral argument to the Court on January 17, 1997, the Court will deny the UMDS Defendants' 12(b)(1), 12(b)(2), 12(b)(5), and forum non conveniens motions for the reasons set forth in this Memorandum. By Order dated today, the Court will also deny the UMDS Defendants' Rule 12(b)(6) motion.

 I. Background

 Based on the exhibits and affidavits submitted to the Court in connection with the UMDS Defendants' motions to dismiss, the Court summarizes the factual contentions of the parties as follows: The Plaintiff Supra Medical Corp. was incorporated in Delaware in 1985 under the name Ventnor Corporation and is located in Chadds Ford, Pennsylvania. The Plaintiff was listed on the American Stock Exchange in 1992 as Topox, Inc., and later that year changed its name to the current Supra Medical Corp.

 In 1990, the Plaintiff acquired patents and patent applications to certain medical scanner technology for use in treating wounds, skin ulcerations, and pressure sores. In 1991, the Plaintiff acquired the patents, licenses and technology to the Supra Scanner, a medical device proposed for use in diagnosing skin cancers, burns, and other types of wounds. One key element of the Supra Scanner, however, was acquired under an exclusive sublicense agreement with the National Aeronautics and Space Administration. Plaintiff's Exh. 39 (Supra Medical Corp. 1993 Annual Report).

 The Supra Scanner combines ultrasound, voice-activation, and computer technology in a single instrument to produce high resolution monochromatic or color images of skin tissue up to approximately 1.5 inches beneath the skin. Such technology permits physicians to assess skin wounds without resorting to exploratory surgery.

 Plaintiff alleges the following scheme by the Defendants to misappropriate its technology: Defendants James McGonigle and Philip Loori were officers and directors of the Plaintiff at the time it acquired patents and patent applications for the Supra Scanner technology in 1991. Soon thereafter, the Plaintiff; Defendant United Medical and Dental Schools of Guy's and St. Thomas's Hospitals; and Defendant Dr. Mary Dyson, the chair of the Schools' Division of Anatomy and Tissue Repair Unit, agreed to establish a program in England to test the efficacy of the Supra Scanner and ultimately establish "wound healing centers" utilizing the Supra Scanner.

 At about the same time that the Plaintiff was establishing a relationship with the UMDS Defendants in 1992, Defendants McGonigle and Loori resigned as officers and directors of Plaintiff and sold most of their shares in Plaintiff's common stock. According to the Plaintiff, Defendants McGonigle and Loori soon thereafter established their own corporation, Defendant Longport, Inc., to pursue the same line of business.

 In 1994, Defendants McGonigle and Loori proposed a joint venture between Longport and the Plaintiff regarding the Supra Scanner technology. The Plaintiff apparently declined this offer. Immediately thereafter, Defendant Dyson resigned from Plaintiff's board of directors and made a presentation of the Supra Scanner to one of Plaintiff's competitors over Plaintiff's objections. Plaintiff alleges that Dyson also engaged in business discussions with Longport.

 In 1995, Defendants McGonigle, Loori, and Longport announced a joint venture with the UMDS Defendants to establish wound healing clinics using medical devices which the Plaintiff claims incorporate its Supra Scanner proprietary technology. Longport and the UMDS defendants are currently developing and testing a medical scanner device at wound healing centers in England and the United States. See Plaintiff's Exhs. 53-59.

 The Plaintiff filed this action on May 16, 1996, alleging that from in or about 1992, the UMDS Defendants and Defendants McGonigle, Loori, and Longport devised and joined in a scheme to misappropriate the Plaintiff's Supra Scanner technology. The complaint alleges mail and wire fraud violations as well as interstate transportation of stolen property. The Plaintiff seeks damages in excess of $ 7 million and a permanent injunction against the Defendants from utilizing or profiting from the Plaintiff's technology.

 II. Defendants' Rule 12(b)(1) Motion to Dismiss Under the Foreign Sovereign Immunities Act, 28 U.S.C. §§ 1602-11

 The UMDS Defendants argue that the Foreign Sovereign Immunities Act ("FSIA" or "Act"), 28 U.S.C. §§ 1602-1611, gives them immunity from this Court's jurisdiction. Section 1604 of the Act provides that "a foreign state shall be immune from the jurisdiction of the courts of the United States . . . ." Moreover, the UMDS Defendants argue that the "commercial activity exception" to the FSIA, § 1605(a)(2), does not strip them of their immunity.

 The FSIA codifies the State Department's previous practice of granting foreign nations immunity from suit in the United States. Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 488, 76 L. Ed. 2d 81, 103 S. Ct. 1962 (1983). "Congress passed the Foreign Sovereign Immunities Act [in 1976] in order to free the Government from the case-by-case diplomatic pressures, to clarify the governing standards, and to 'assure litigants that . . . decisions are made on purely legal grounds and under procedures that insure due process.'" Id. "To accomplish these objectives, the Act contains a comprehensive set of legal standards governing claims of immunity in every civil action against a foreign state or its political subdivisions, agencies or instrumentalities." Id.

 Motions to dismiss under the FSIA must be brought pursuant to Fed. R. Civ. P. 12(b)(1) because the Act raises a question of the court's subject matter jurisdiction. The FSIA "provides the sole basis for obtaining jurisdiction over a foreign state in the courts of this country." Saudi Arabia v. Nelson, 507 U.S. 349, 113 S. Ct. 1471, 1476, 123 L. Ed. 2d 47 (1993) (quoting Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 433, 109 S. Ct. 683, 102 L. Ed. 2d 818 (1989)). Unless an exception to the FSIA applies, a court lacks subject matter jurisdiction over a claim against a foreign state or its agency or instrumentality. Saudi Arabia, 113 S. Ct. at 1476 (citing Verlinden, 461 U.S. at 488-89); Federal Insur. Co. v. Rubin, 12 F.3d 1270, 1279 & 1284 n. 13 (3d Cir. 1993); Foremost-McKesson v. Islamic Republic of Iran, 284 U.S. App. D.C. 333, 905 F.2d 438, 442 (D.C. Cir. 1990).

 In Verlinden, the Supreme Court upheld the constitutionality of the FSIA under both Articles I and III of the United States Constitution. First, the Court concluded that Congress could restrict actions involving foreign states under its express authority in Article I to regulate foreign commerce. The Act "governs the types of actions for which foreign sovereigns may be held liable in a court in the United States, federal or state." Verlinden, 461 U.S. at 496-97. Second, the Court held that the FSIA's jurisdictional grant to federal courts complies with Article III, since every action against a foreign sovereign involves a question of substantive federal law and therefore "arises under" federal law. Id. at 497.

 When moving to dismiss under the FSIA, the defendant bears the initial burden of making a prima facie showing that it is a "foreign state" or "agency or instrumentality" of a foreign state and thus enjoys sovereign immunity. Federal Insur. Co., 12 F.3d at 1285 n. 13. The burden then shifts to the plaintiff to produce evidence establishing that the foreign state is not entitled to immunity under one of the exceptions in § 1605. The ultimate burden of proving immunity, however, rests with the party claiming that it is an agency or instrumentality of a foreign state. Id.

 Accordingly, this Court must undertake a two-step inquiry in deciding the UMDS Defendants' Rule 12(b)(1) motion to dismiss. First, under § 1603, are the UMDS Defendants a foreign state or agency or instrumentality of a foreign state? Second, if so, are the UMDS Defendants stripped of ...

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