Mahmoud Shaban & Sons v. Mediterranean Shipping

U.S. DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Admiralty

New York Law Journal

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Judge Thomas Griesa

Jordan's Mahmoud Shaban & Sons (MSS) bought rice from California's American Commodity Co. (ACC). Loaded in California, the rice arrived in Jordan unfit for consumption. MSS sought recovery from carrier GlobeRunners and ship owner Mediterranean Shipping Co. (MSC). GlobeRunners sued ACC for indemnity or contribution, alleging the rice tainted at loading, when ACC had exclusive control. No party's business is in, nor did the transaction touch, the district. The court denied ACC dismissal. GlobeRunners acted as its agent when agreeing to a forum clause in its bill of lading with MSC, establishing personal jurisdiction over ACC. Discussing A.P. Moller-Maersk v. Ocean Express Miami, the court concluded it remained the law—as expressed by Home Assur. ex rel. Stanley Door Sys. v. M/V Hanjin Marseilles and Jockey Int'l v. M/V Leverkusen Express—that a shipping intermediary acts as the "upstream" merchant or carrier's agent when it agrees to a forum selection clause with a "downstream" carrier. Under the pact's definitions of "carrier" and "merchant," both ACC and GlobeRunners were "merchants." The subject clause covered "any suit by Merchant" and "any suit by the Carrier" without mentioning contemplated defendants.

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