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PIERCING THE TRANSNATIONAL MARITIME VEIL: WHAT LAW APPLIES IN RULE B ATTACHMENT PROCEEDINGS?

TABLE OF CONTENTS

I. Introduction                                     268
II. Background of Topics                            270
 A. Charterparties                                  270
 B. Rule B Attachment                               271
 C. Arbitration Clauses                             272
 D. Choice-of-Law                                   274
 E. Piercing the Corporate Veil                     277
III. Blue Whale Case                                279
 A. Terms of the Charterparty                       280
 B. HNA's Property is Attached in New York          281
 C. Attachment vacated by Southern District of New
    York                                            282
 D. Second Circuit Court of Appeals' Decision       282
 E. Application of Rule Made by Blue Whale          284
IV. Discussion                                      285
 A. Choice of Law Clause Cannot Govern Corporate
    Identity                                        285
 B. What Law Should Govern? Choice of Law Analysis  286
  1. Jurisdiction                                   286
  2. Substantive Law                                287
 C. Limited Inquiry--Prima Facie Pleading           290
 D. Suggested Remedy                                290
V. Conclusion                                       293


I. INTRODUCTION

A hypothetical vessel owner with multiple vessels makes his living by chartering his vessels to other parties. One day, the vessel owner contracts with a foreign business for the charter of one of the vessels for a single voyage. The vessel will be loaded with 250,000 tons of iron ore in Brazil bound for a port in mainland China. The charterer is required to pay 98% of the freight, (1) roughly $4.5 million, seven days after loading the ore. The seven days pass without the freight being paid. Nervous that the charterer may not pay, the vessel owner asserts a maritime lien over the cargo and instructs the captain to wait in a safe port for further instructions. Almost two weeks later, the charterer pays the 98% balance, and the vessel owner instructs the vessel to set sail for the next port. The cargo having been discharged, the vessel owner invoices the charterer for the remaining 2%, the costs he incurred from the delay (demurrage), (2) and the costs of the exercise of the lien. The charterer fails to pay the remainder. Thus, per the agreement in the charterparty, the vessel owner commences arbitration in London whereby English law will apply to the dispute. Anticipating that the company may become insolvent, the vessel owner files an ancillary proceeding in the United States to obtain security for a possible arbitration award. Because the defendant company appears to be low in capital, the vessel owner decides to pursue a claim against its parent company's assets in New York and files a Rule B (3) attachment action in the Southern District of New York. The assets, however, belong to a different wholly owned subsidiary of the parent corporation. To pursue a claim against the parent or the sibling corporation's assets, the vessel owner must assert an alter ego claim to pierce the corporate veil. There is no dispute that the charterparty between the vessel owner and the charterer is a maritime contract within admiralty jurisdiction which is a requirement for the vessel owner to avail himself of a Rule B proceeding. (4) What is not clear, however, is what law will govern the inquiry of corporate identity and whether corporate form should be disregarded to pierce the corporate veil to hold shareholders liable for the corporation's obligations.

There are many risks in the international shipping industry. The vessel could get caught in a storm and sink. Pirates could hijack the vessel and take the crew and cargo hostage. The vessel could collide with another vessel or allide with an object, causing damage to property and persons, potentially giving rise to liability. Even with these dangers considered, perhaps the biggest concern of the shipper is collecting the freight from the consignee. (5) The shipper may refuse to deliver the cargo until a certain portion of the freight is paid, delaying the vessel's schedule. Shippers that enter into voyage charters attempt to perfectly time one charterparty to end as the next begins, from port to port. (6) In order to generate income for their owner, vessels must keep moving because idle vessels bleed money.

In a business fraught with so many risks, it is not surprising that each contracting party would seek to protect itself contractually. Known variables in a contract are one way a party can protect itself when contracting with an unknown party. This can be done by inserting choice clauses (that is, choice-of-law, choice-of-forum, and arbitration clauses) which are actually "specialized forum selection clause[s]," (7) and are typically part of every charterparty contract.

The first part of this comment will give a brief historical background of the topics at issue. The second part will discuss the case in which these issues arose, Blue Whale Corp. v. Grand China Shipping Development Co., Ltd., (8) including the application of the rule developed by Blue Whale. The third part will discuss the problems with the Blue Whale decision and possible alternatives.

II. BACKGROUND OF TOPICS

A. Charterparties

A charterparty is a contract whereby a vessel, or a part thereof, is leased for a '"specified term, or for a specified voyage, in consideration of a certain sum of money per month or per ton, or both, or for the whole period or adventure described.' These contracts are considered maritime contracts, and are, therefore, cognizable in admiralty." (9) Like many terms, concepts, and rules in admiralty, charterparties have a rich history. The origin of the term "charterparty" can be traced to the method in which the contract was formulated. (10) Identical terms of a contract were written on opposite sides of a sheet of paper which was then separated and each party received a copy. (11) In the event of a dispute, the pieces of paper were put back together to prove the existence of a contract. (12) "Charter" refers to the lease of the vessel, while "party" originated from the separation or "parting" of the contract. (13) A charterparty is subject to the general rules governing contract, as it is a contract. (14) Though most charterparties are reduced to a writing, verbal agreements are binding. (15) There are no statutory provisions that govern charterparties, but rather the law is comprised of judicial and arbitral decisions. (16)

B. Rule B Attachment

Actions in rem can be traced to Roman law. (17) The action to recover or obtain the actual thing through possession of it is founded in Civil law. (18) The action further developed in medieval Europe around the fifteenth century. (19) In rem actions largely developed because of the refusal of defendants to appear before the court. (20) The United States allows remedies to creditors through arrest in rem and maritime attachment. (21) These remedies have a long history and have been codified in the Supplemental Rules for Certain Admiralty and Maritime Claims of the Federal Rules of Civil Procedure. (22) This article will focus primarily on the United States' attachment procedure known as Rule B. (23) Though Rule B attachment is considered an in personam action, it is oftentimes referred to as a quasi in rem action. (24) Because Rule B jurisdiction is in personam, if the defendant appears in the action and the plaintiff's claim is allowed, the judgment is enforceable against all of the defendant's property, and not only against the property seized as in the action in rem. If the defendant fails to appear in court, the maximum amount the plaintiff could hope to recover is limited to the value of the property attached. (25) Attachment allows a court to obtain jurisdiction over a defendant though their property and allows a plaintiff to obtain security in the event a defendant cannot be located. (26)

C. Arbitration Clauses

One method of alternate dispute resolution available in maritime practice is arbitration. (27) Arbitration also seeks to reduce the costs of resolving legal disputes and to avoid procedural complexity. (28) Previously, litigation was favored over arbitration to resolve disputes. (29) Arbitration clauses were routinely deemed as invalid attempts to usurp the jurisdiction of the courts. (30) The passage of the Federal Arbitration Act (F.A.A.) (31) in 1925, turned the tide the other way, irrevocably. (32) Arbitration is now favored over litigation, particularly in disputes involving international commerce. (33) Maritime contracts--charterparties in particular--commonly contain arbitration clauses. (34) Arbitration clauses found in charterparties are presumed to be valid. (35) If a lawsuit is filed and an arbitration clause is deemed valid, the arbitration clause will likely be enforced by an order compelling arbitration or staying court proceedings. (36) For this reason, charterparty disputes are the number one source of maritime arbitrations. (37) New York and London have become popular hubs of arbitration. (38) Both cities are major ports and have a large connection to the international shipping industry. (39) London is the epicenter of the marine insurance industry with Lloyd's of London being the most dominant. (40) New York is one of the United States' leading ports and is the headquarters for a large amount of international finance and banking. (41) Both cities have numerous firms specializing in maritime arbitration. (42) In London, there are associations or societies which specialize in particular types of disputes: London Maritime Arbitrators Association (charterparties) and Council of Lloyd's (salvage), while the Society of Maritime Arbitrators, Inc. dominates the field in New York. (43)

D. Choice-of-Law

Choice-of-law provisions have been traced back as far as Hellenistic Egypt. (44) During that time period, the language of the contract--such as Egyptian or Greek--would determine what law would govern the contract. (45) Parties could choose their forum and law by simply writing their contract in the controlling contractual language. (46) The law has adapted over time, and no longer are parties required to write the provisions of contracts in the language of the state to have the laws of that state govern the contract. In the United States, the Restatement (Second) of Conflicts of Laws is now the preferred approach and states:

(1) The law of the state chosen by the parties to govern their contractual rights and duties will be applied if the particular issue is one which the parties could have resolved by an explicit provision in their agreement directed to that issue.

(2) The law of the state chosen by the parties to govern their contractual rights and duties will be applied, even if the particular issue is one which the parties could not have resolved by an explicit provision in their agreement directed to that issue, unless either

(a) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties' choice, or

(b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue and which, under the rule of [section] 188, would be the state of the applicable law in the absence of an effective choice of law by the parties.

(3) In the absence of a contrary indication of intention, the reference is to the local law of the state of the chosen law. (47)

The Restatement continues in Section 188 to lay out specific factors to consider when determining what law governs a particular dispute:

(1) The rights and duties of the parties with respect to an issue in contract are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the transaction and the parties under the principles stated in [section] 6.

(2) In the absence of an effective choice of law by the parties (see [section] 187), the contacts to be taken into account in applying the principles of [section] 6 to determine the law applicable to an issue include:

(a) the place of the contraction,

(b) the place of negotiation of the contract,

(c) the place of performance,

(d) the location of the subject matter of the contract, and

(e) the domicile, residence, nationality, place of incorporation and place of business of the parties. These contacts are to be evaluated according to their relative importance with respect to the particular issue.

(3) If the place of negotiating the contract and the place of performance are in the same state, the local law of this state will usually be applied, except as otherwise provided in [section][section] 189-199 and 203. (48)

In the maritime context, the U.S. Supreme Court adopted a similar approach to that of the Restatement in Lauritzen v. Larsen and The BREMEN u. Zapata Offshore, Inc. (49)

In Lauritzen v. Larsen, (50) the U.S. Supreme Court was faced with the issue of what law should apply to a Danish seaman who was injured in Havana, Cuba and later brought suit in New York. (51) Larsen, the seaman, sought remedies provided by United States law under the Jones Act. (52) The Court noted that (1) Larsen was a Danish citizen; (2) he was injured aboard the RANADA, a Danish flagged vessel; (3) the owner of the RANADA was a Danish citizen; and (4) the articles of the ship, which Larsen signed, were written in Danish and provided that all rights of the crewmembers would be governed by Danish law and by the contract between the owner and the Danish Seaman's Union, of which Larsen was a member. (53) The vessel owner contested not only the U.S. court's jurisdiction, but also the application of U.S.-based law. (54) Through the plain wording of the Court's decision, it is obvious the Court did not intend the application of the factors they developed to be applied to cases other than maritime torts: "We therefore review the several factors which, alone or in combination, are generally conceded to influence choice of law to govern a tort claim, particularly a maritime tort claim, and the weight and significance accorded them." (55) The factors the Court decided to consider for what law would apply to the case were (1) the place of the wrongful act, (2) the law of the flag of the vessel, (3) the allegiance or domicile of the injured person, (4) the allegiance of the defendant shipowner, (5) the place of contract, and (6) the inaccessibility of the foreign forum. (56) In developing factors 1 and 2--the place of the wrongful act and the law of the flag of the vessel--the court cited to the Restatement of Conflict of Laws. (57)

In the M/S BREMEN v. Zapata Off-Shore Co., the Supreme Court again cited to the Restatement of Conflict of Laws in a maritime case; however, the dispute arose from contract rather than tort. (58) Zapata Off-Shore Company ("Zapata") contracted with Unterweser, owner of the M/S BREMEN, to tow an ocean-going, self-leveling drilling rig, the CHAPARRAL, owned by Zapata, from Louisiana to off-shore Italy. (59) After negotiating several terms of the contract, the final effective version contained the following forum selection clause: "Any dispute arising must be treated before the London Court of Justice." (60) While in the international waters of the Gulf of Mexico, the tow was caught in a storm and the CHAPARRAL was damaged. (61) Zapata directed the BREMEN to go to the nearest port of refuge, Tampa, Florida, and subsequently filed suit against Unterweser in personam and the BREMEN in rem in the United States District Court for the Middle District of Florida in Tampa. (62) Unterweser moved for the dismissal of the case on the bases of lack of jurisdiction or forum non conveniens. (63) The district court denied Unterweser's motion to dismiss, denied a stay in the proceedings, and granted Zapata's motion to restrain Unterweser from further litigating the case in London. (64) The district court relied upon Fifth Circuit precedent quoting that "agreements made in advance of controversy whose object is to oust the jurisdiction of the courts are contrary to public policy and will not be enforced." (65) This ruling was upheld by the U.S. Court of Appeals for the Fifth Circuit both on panel and upon rehearing en banc. (66) The Supreme Court reversed, ruling that "[forum selection] clauses are prima facie valid and should be enforced unless enforcement is shown by the resisting party to be 'unreasonable' under the circumstances." (67) The Court notes that this view is the same as the Restatement of the Conflict of Laws. (68) The Supreme Court's willingness to look to the Restatement of the Conflict of Laws for matters of maritime tort and forum selection clauses is significant insofar as the Court may look to the Restatement for future disputes involving corporate identity and piercing the corporate veil.

E. Piercing the Corporate Veil

The legal construct of piercing the corporate veil has long confused courts and scholars alike. Chief Justice Cardozo put it cogently when he commented on the legal fiction of limited liability of corporations: "The whole problem of the relation between parent and subsidiary corporations is one that is still enveloped in the mists of metaphor." (69) The legal fiction of corporate form was created with the intention of insulating shareholders from liability with regard to claims of creditors. (70) Incorporation with the intention of limiting liability does not automatically nullify it. (71) In his opinion in Anderson v. Abbott, Justice William O. Douglas stated the importance of the doctrine of limited liability--emphasizing that "[l]imited liability is the rule not the exception; and on that assumption large undertakings are rested, vast enterprises are launched, and huge sums of capital are attracted." (72) Indeed, there are instances when limited liability will be denied. (73) Chief Judge Cardozo stated that a surrender of that principle of limited liability would be made "when the sacrifice is so essential to the end that some accepted public policy may be defended or upheld." (74) Fraud is regularly used as reason for disregarding limited liability, but it is not a prerequisite. (75) Anderson v. Abbott has frequently been quoted to support veilpiercing in situations where there has been no fraud: "[a]n obvious inadequacy of capital, measured by the nature and magnitude of the corporate undertaking, has frequently been an important factor in cases denying stockholders their defense of limited liability." (76)

Corporate structure has increasingly become a more recurrent theme in maritime disputes. Incorporation has typically been used as a way of limiting liability and piercing the corporate veil allows a plaintiff to establish the liability of shareholders, alter egos, and corporate officers. (77) The factors courts use in determining whether to pierce the corporate veil vary drastically between circuits. (78) During the brief period in time where attachment of electronic funds transfers (EFTs) were allowed in the Second Circuit, the Southern District of New York and the Second Circuit heard numerous cases involving alter ego disputes. (79) In Winter Storm Shipping Ltd. v. TPI, a vessel owner sought and was granted Rule B attachment of funds which momentarily passed through an intermediary bank as an electronic fund transfer. (80) The Southern District of New York granted the motion to vacate the attachment of the funds. (81) The Second Circuit determined that (1) due process did not require that the charterer have prior knowledge of which intermediary bank would be used to effect maritime attachment; (82) (2) the charterer's funds in the hands of the intermediary bank during implementation of an electronic funds transfer were deemed property subject to maritime attachment; (83) and (3) a New York state statute which prohibited courts from restraining funds during electronic transfer was preempted by federal maritime law. (84) Winter Storm was later overruled by Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd. (85) on the basis that under New York law, "EFTs are neither the property of the originator nor the beneficiary while briefly in the possession of an intermediary bank." (86) This is significant because it signifies the willingness of the federal courts asserting admiralty jurisdiction to step back and respect the laws of the states rather than declare federal supremacy.

III. BLUE WHALE CASE

The facts of Blue Whale Corporation v. Grand China Shipping Development Co., Ltd. are essentially the same as set forth in the introduction of this comment. (87) Blue Whale Corporation ("Blue Whale"), a foreign company, owned a vessel registered in Liberia. (88) Blue Whale entered into a charterparty agreement with a Chinese company, Grand China Shipping Development Company, Ltd. ("Development") on May 25, 2011. (89) The parties agreed that Development would pay 98% of the freight, totaling $4.56 million within seven Hong Kong banking days after the completion of cargo loading operations. (90) The loading operations were completed on July 17, 2011, and Development was sent an invoice. (91) Blue Whale sent numerous communications requesting payment; however, Development failed to pay by July 26, 2011. (92) On August 25, 2011, Blue Whale exercised a lien over the cargo, and instructed the vessel to dock in Singapore to await further instructions. (93) On approximately September 2, 2011, Development paid the balance. (94) Blue Whale released the lien and directed the vessel to sail to the destination port of Xingang on September 5, 2011. (95) On September 15, 2011, Blue Whale invoiced Development for the remaining 2% of the freight, $126,918.04, which was due within thirty days of the completion of discharge, October 27, 2011. (96) On October 13, 2011, Blue Whale sent Development an invoice for the demurrage costs, $494,753.30, associated with the delay in paying the initial 98%. (97)

A. Terms of the Charterparty

The terms of the charterparty provided that Blue Whale would transport 250,000 metric tons of iron ore from Ponta da Madeira, Brazil to Majishan or Qingdao, People's Republic of China. (98) The charterparty contained an arbitration clause which contained a choice-of-law clause as follows:

Any disputes arising under the Contract shall be settled amicably. In case no such settlement can be reached, the matter in dispute shall be referred to arbitration in London and British law to apply. One chosen by each of the parties hereto and the third by the two so chosen; their decision or that of two of them shall be final, and for the purpose of enforcing and award, this agreement may be made a rule of the court. The arbitrators shall be commercial men."

B. HNA's Property is Attached in New York

On March 26, 2012, Blue Whale Corporation filed a verified complaint seeking Issuance of Process of Maritime Attachment and Garnishment. (100) In its complaint, Blue Whale sought to attach all tangible and intangible property belonging to Grand China Shipping Development and HNA Group up to $1,315,710.18. (101) Blue Whale alleged that Grand China Shipping and HNA Group were only separate from each other as a formality. (102) Blue Whale supported its argument through the following allegations: (1) Grand China Shipping and HNA Group shared a common logotype which feature the initials "HNA"; (2) the two companies utilized e-mail addresses with the same domain name; (3) the intermediary corporation Grand China Logistics held 97 percent of the stock in Grand China Shipping; (4) Grand China Shipping's activities were dominated by HNA and Grand China Logistics, and (5) Grand China Shipping Development was undercapitalized. (103) Blue Whale further alleged that Grand China Shipping, Grand China Logistics, and HNA Group used the corporate separateness to conduct fraudulent trading practices by avoiding to pay their obligations. (104)

The diagram below should provide a better visual demonstration of the corporate structure and relationships between the parties.

C. Attachment vacated by Southern District of New York

The Southern District of New York granted HNA Group's motion to vacate the attachment. (105) The Southern District of New York ruled that, pursuant to the choice of law clause in the charterparty, English law applied to the dispute. (106) Under English law, piercing the corporate veil is rare. (107) Evidence of an impropriety alone is insufficient. (108) Under English law there must exist some liability to the plaintiff by the defendant at the time of incorporation and the purpose of incorporation was to avoid that liability. (109) The Southern District of New York held that under those stringent standards, Blue Whale failed to plead a valid prima facie claim against HNA. (110) HNA did not plead that it created the subsidiary Grand China Shipping Development to avoid an existing liability to Blue Whale. (111)

D. Second Circuit Court of Appeals' Decision

The Second Circuit held that the prima facie validity of a maritime claim depends upon the substantive law applied and that maritime choice of law principles determine what substantive law governs alter ego claims. (112) In conducting a maritime choice of law analysis, the Second Circuit determined that federal common law was applicable to the alter ego claim. (113) The Second Circuit vacated the district court's ruling and remanded the case with instructions to apply federal common law to the alter ego claim. (114)

In its analysis, the Second Circuit stated that the prima facie validity of a claim under Rule B relies upon substantive law. (115) The inquiry of whether a claim sounds in admiralty is a procedural inquiry and is governed by federal maritime law. (116) The Southern District of New York was split on what law governs a case's prima facie validity and the Second Circuit had yet to weigh in on the matter. (117) Harley Mullion & Co. Ltd. v. Caverton Marine Ltd. (118) presumed that "federal law governs all questions concerning the validity of a Rule B attachment." Al Fatah Int'l Nau. Co. Ltd. v. Shivsu Canadian Clear Waters Tech. (P) Ltd. held that "Rule B itself does not provide the basis for determining the existence of a valid prima facie admiralty claim," but rather, "the existence of a valid prima facie claim turns on substantive law." (119) The Second Circuit agreed with Al Fatah, determining that "substantive law supplies the relevant measure for deciding whether or not the claim is legally sufficient." (120) This led the court to ponder, "[W]hat substantive law controls the validity of Blue Whale's alter ego claim?" (121) The court determined there were three possibilities as to what law would apply: the choice-of-law provision in the charterparty, an automatic application of federal common law, or whatever law a maritime choice-of-law analysis would determine appropriate. (122) Because the court held that alter ego status is collateral to a charterparty contract, the choice-of-law provision could not provide the applicable substantive law. (123)

In engaging in a choice-of-law analysis, the court determined that the proper choice-of-law doctrine was maritime choice-of-law. (124) Maritime choice-of-law is governed by Lauritzen-Rhoditis-Romero; the rules developed by Lauritzen v. Larsen, Hellenic Lines Ltd. v. Rhoditis, and Romero u. Int'. Terminal Operating Co. (125) The rule set forth by Lauritzen-Rhoditis was designed to determine what law applied in cases involving personal injury and death of seamen, but has since been applied to all types of maritime conflicts by lower courts. (126) The Second Circuit determined that in weighing the Lauritzen "points of contact," federal common law was proper to apply for determining the prima facie validity of Blue Whale's claim. (127)

E. Application of Rule Made by Blue Whale

The application of the rule set forth by the Second Circuit can be confusing. A plaintiff seeking to invoke the admiralty jurisdiction in United States federal courts must plead a valid prima facie case. Whether the plaintiff will be afforded the special procedures and rules afforded under admiralty jurisdiction depends on whether the claim sounds in admiralty. The law which governs whether or not a claim sounds in admiralty is governed by federal maritime law. If a claim is determined to sound in admiralty, admiralty jurisdiction and all of its rules and procedures apply. To determine the applicable law that governs the underlying claim, a maritime choice-of-law analysis must be conducted. The maritime choice-of-law analysis weighs particular "points of contact" to determine which law has the most significant contacts with the underlying issue. Once the proper controlling law is determined, it is applied to determine whether the plaintiff has properly pled a valid prima facie case.

IV. DISCUSSION

Lord Denning's metaphor accurately describes the allure of United States courts to foreign plaintiffs: "As a moth is drawn to the light, so is a litigant drawn to the United States. If he can only get his case into their courts, he stands to win a fortune." (128) United States courts are often called upon to consider in rem actions brought by foreign claimants seeking recovery in claims governed by foreign law. (129) This is due to the international nature of the maritime industry. (130) United States courts are an attractive forum for in rem claims. (131) This is evidenced by the fact that far more claims are secured by a maritime lien under United States maritime law than under the law of other countries. (132) Often, a plaintiff seeking an in rem remedy in the United States would not be afforded the claim in the foreign forum under which the foreign governing law would apply. (133) An understanding of both admiralty procedure and choice-of-law principles is required because the law governing such cases is complex and often confusing. (134)

A. Choice of Law Clause Cannot Govern Corporate Identity

Conceptually, the rules which govern parties' contractual relationships with one another can be separated into two types of rules, "imperative" and "suppletive." This concept of imperative and suppletive rules are rooted in ancient Roman law. (135) In ancient Roman law, jus cogen were rules which were mandatory and could not be deviated from and jus dispositivum were rules which were suppletive and could be disregarded through agreement. (136) Imperative rules cannot be contracted out of and are typically protective in nature. Imperative rules pertaining to corporations can be divided into two categories: rules which protect creditors and rules which protect minority shareholders. (137) For the purposes of this comment, only the rules which seek to protect creditors are of interest. Some such protective rules for the benefit of creditors are minimum capitalization and distribution of assets by way of dividends leading to liquidation. (138)

There is a logical public policy reason for the law governing corporate identity to be a mandatory rule. A sophisticated corporation could contract with an unsophisticated party and insert a clause stipulating what law would govern the corporate identity. The sophisticated party could choose law more favorable to his corporation which would make it harder to pierce the corporate veil. Mandatory laws seek to protect creditors, especially those less sophisticated. The other reason would be for uniformity in the application of law. The Supreme Court in Edgar v. MITE Corp. stated, "[0]nly one state should have the authority to regulate a corporation's internal affairs... because otherwise a corporation could be faced with conflicting demands." (139) Similarly, the Court in Kamen v. Kemper Fin stated, "Uniform treatment of directors, officers and shareholders is an important objective which can only be attained by having the rights and liabilities of those persons with respect to the corporation governed by a single law." (140) Lastly, the Court in CTS Corp. v. Dynamics ruled, "[t]his beneficial free market system depends at its core upon the fact that a corporation--except in the rarest situations--is organized under, and governed by, the law of a single jurisdiction, traditionally the corporate law of the state of its incorporation." (141)

B. What Law Should Govern? Choice of Law Analysis

1. Jurisdiction

Jurisdiction is "the power and authority... to pronounce the sentence of the law, or to award the remedies provided by law... in favor of or against persons (or a res) who present themselves, or who are brought, before the court in some manner sanctioned by law as proper and sufficient." (142) In some cases, the United States' federal courts may assert jurisdiction over parties who have otherwise agreed to subject themselves to the jurisdiction of another adjudicator such as an arbitral panel subject to the laws of another nation. Prior to the Federal Arbitration Act, "[t]he law is, and always has been, in the absence of a statute authorizing them to do so, that parties may not by private agreement oust the jurisdiction of the courts." (143) Once the Act was passed, arbitration in lieu of litigation did not oust the jurisdiction of the courts, but "provide[d] for maintaining [the court's] jurisdiction while at the same time recognizing arbitration agreements as affirmative defenses and providing a forum for their specific enforcement." (144) As long as the courts have jurisdiction, an arbitration clause will not automatically oust that jurisdiction. For Rule B attachments, the jurisdiction originates with the location of a res within the district and subject to the court's jurisdiction. To avail themselves of the procedures granted under Federal Rules of Civil Procedure Supplemental Rules for Certain Admiralty and Maritime Claims, plaintiffs must validly invoke a court's Admiralty Jurisdiction.

2. Substantive Law

In attempting to determine the applicable substantive law that should apply in a veil piercing or alter ego claim, the Second Restatement of Conflict is instructive:

The local law of the state of incorporation will be applied to determine the liability to which a person subjects himself by purchasing, or subscribing to, shares of a corporation. This law will likewise be applied to determine whether the shareholder's liability runs to the corporation, or to its creditors, or to both the corporation and its creditors. The local law of the state of incorporation will be applied to determine such issues because (1) this is the law which the shareholders, to the extent that they thought about the question, would usually expect to have applied to determine their liability, (2) exclusive application of this law will assure uniform treatment of shareholders or of classes of shareholders and (3) this state will usually have the dominant interest in the determination of this issue. (145)

When the defendant is a foreign entity, the Second Restatement holds, "[a] state may impose liability upon a shareholder of a foreign corporation for an act done by the corporation in the state, if the state's relationship to the shareholder is sufficient to make reasonable the imposition of such liability upon him." (146)

The Second Circuit in Kirno Hill v. Holt contemplated veil piercing in the maritime context:

[t]he prerequisites for a piercing a corporate veil are as clear in federal maritime law as in shoreside law: [the parent] must have used [the subsidiary] to perpetrate a fraud or have so dominated and disregarded [the subsidiary]'s corporate form that [the subsidiary] primarily transacted [the parent]'s personal business rather than its own corporate business. (147)

The District Court for the District of Connecticut noted the ambiguity of the statement in Kirno Hill:

While the court noted that the requirements were the same for federal maritime law as for shoreside law, there is no indication as to which shoreside law the Court was referring. As discussed below, however, while subsequent cases have adopted the Court's holding as the proper rule for federal maritime law, they have not adopted the Court's conclusion that this rule is the same for shoreside law... [T]he Court's use of the disjunctive 'or' appears to set forth alternative methods of piercing the corporate veil--either by a showing of fraud or by a showing of domination. (148)

The Second Circuit recognized that '"[w]hile complete domination of the corporation is the key to piercing the corporate veil... such domination, standing alone, is not enough; some showing of a wrongful or unjust act toward [the party seeking piercing] is required.'" (149) The Fifth Circuit has subsequently explained that this injustice requirement can be met by showing fraud, an illegal act, or a misuse of the corporate form. (150)

The Fifth Circuit attempted to create their own rule for veil piercing. Generally, the corporate veil is pierced "only if (1) the owner exercised complete control over the corporation with respect to the transaction at issue and (2) such control was used to commit a fraud or wrong that injured the party seeking to pierce the veil." (151) Although the Fifth Circuit has not addressed whether federal common law permits a subsidiary to be held liable for the parent corporation's obligations, the court has indicated that there is little conceptual difference between the test for forward as opposed to reverse veil piercing. (152)

In White Rosebay Shipping S.A v. HNA Group, Co., Ltd., the Fifth Circuit acknowledged federal common law's attempt at uniformity in the maritime field, but the court refused to be bound by decisions made by other districts or circuits, holding:

Although it is true that the purpose of adopting federal common law--maritime or otherwise--is to promote uniformity, this does not preclude the possibility that different circuits may adopt varying interpretations of federal law because the only common binding precedent among each circuit is that of the Supreme Court. Therefore, because courts in the Fifth Circuit have never drawn a distinction between federal common law and maritime law in the context of veil piercing, it is inappropriate to do so here, regardless of any precedent from the District of Connecticut or the Second Circuit. (153)

The Circuits' unwillingness to develop a uniform rule regarding maritime choice-of-law as it pertains to piercing the corporate veil signifies the need for a Supreme Court ruling.

C. Limited Inquiry--Prima Facie Pleading

The Second Circuit in Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd. determined that a Rule B proceeding was a limited inquiry and fact-intensive inquiries were not proper. (154) Aqua Stoli did not involve a veil piercing claim, but the Second Circuit cited Aqua Stoli in Blue Whale in discussing the need for simplifying the Rule B process. (155) This goal is at conflict, however, with the nature of a veil piercing claim. At its core, a veil piercing claim is fact intensive. (156)

The District of Maryland in Vitol S.A. v. Capri Marine Ltd. described the fact intensive nature of a veil piercing claim, When determining whether to pierce a corporate veil based upon allegations of alter ego, courts consider various factors, including but not limited to the existence, vel non, of gross undercapitalization, insolvency, siphoning of funds, failure to observe corporate formalities and maintain proper corporate records, non-functioning officers, control by a dominant stockholder, injustice or fundamental fairness, etc. To disregard the corporate form a number of factors must be present, including 'an element of injustice or fundamental unfairness.' The determination of alter ego is a factually intensive matter and to be made on a case-by-case basis. (157)

The courts need to address the conflict in one of two ways: either disallow veil piercing claims in Rule B attachment actions, or allow for a more fact intensive inquiry for veil piercing claims in Rule B attachments.

D. Suggested Remedy

One possible remedy would be to codify specific conflict-of-laws provisions to apply strictly to cases which fall under the court's admiralty jurisdiction. English Admiralty courts, the basis of the American maritime law, has its roots in civil law rather than common law. One tenet of civil law is codification of laws because codification assists in uniformity. Circuits would have a clearer rule to apply, and there would be less discord between circuits. Louisiana has codified conflict-of-laws provisions in the Civil Code, and the provisions could be instructive in developing a federal conflict of laws provision. Louisiana Civil Code Article 3515 states:

Except as otherwise provided in this Book, an issue in a case having contacts with other states is governed by the law of the state whose policies would be most seriously impaired if its law were not applied to that issue. That state is determined by evaluating the strength and pertinence of the relevant policies of all involved states in the light of: (1) the relationship of each state to the parties and the dispute; and (2) the policies and needs of the interstate and international systems, including the policies of upholding the justified expectations of parties and of minimizing the adverse consequences that might follow from subjecting a party to the law of more than one state. (158)

This article is similar to the contacts rule set forth in Shaffer and Lauritzen, but it accounts for policies of another state being harmed if its laws are not applied to the matter. This type of consideration would be especially helpful in piercing the corporate veil situations. A sovereign nation's policy of regulating corporations organized under its laws would be undermined in certain situations if its laws were ignored and the laws of another nation were applied. There could still be scenarios where the laws of the United States would be applied over the laws of the country of incorporation. One example of such a scenario, a foreign corporation which complies with the laws of the country where it is incorporated, but the allowance of the limitation of shareholder liability would cause harm to United States citizens or policies. The Louisiana code even has separate code articles for contracts (conventional obligations) and torts (delictual obligations). Louisiana Civil Code Article 3537 deals with conventional obligations and provides:

Except as otherwise provided in this Title, an issue of conventional obligations is governed by the law of the state whose policies would be most seriously impaired if its law were not applied to that issue. That state is determined by evaluating the strength and pertinence of the relevant policies of the involved states in the light of: (1) the pertinent contacts of each state to the parties and the transaction, including the place of negotiation, formation, and performance of the contract, the location of the object of the contract, and the place of domicile, habitual residence, or business of the parties; (2) the nature, type, and purpose of the contract; and (3) the policies referred to in Article 3515, as well as the policies of facilitating the orderly planning of transactions, of promoting multistate commercial intercourse, and of protecting one party from undue imposition by the other. (159)

Louisiana Civil Code Article 3542 governs delictual and quasi-delictual obligations

Except as otherwise provided in this Title, an issue of delictual or quasi-delictual obligations is governed by the law of the state whose policies would be most seriously impaired if its law were not applied to that issue. That state is determined by evaluating the strength and pertinence of the relevant policies of the involved states in the light of: (1) the pertinent contacts of each state to the parties and the events giving rise to the dispute, including the place of conduct and injury, the domicile, habitual residence, or place of business of the parties, and the state in which the relationship, if any, between the parties was centered; and (2) the policies referred to in Article 3515, as well as the policies of deterring wrongful conduct and of repairing the consequences of injurious acts. (160)

Federal alter ego law does not weigh the importance to the state of having its laws applied to the individual case. (161) Instead of examining the interests of the state of incorporation, federal courts follow federal precedent, usually without regard to the state's corporate law. (162) Ignoring the consideration of state corporate law is adverse to one of the fundamental principles of federal common law--the balancing of state versus federal interests. (163) Rather than mechanically looking to factors identified in previous cases, the court should determine whether the corporate veil should be pierced "in the light of the policy underlying the applicable legal rule, whether of statute or common law." (164) One scholar proposed a two prong test. (165) The first prong, "unity of interest and ownership," would have domination and control as crucial factors. (166) The second prong would be proof of an "inequity." (167) Inequity may be satisfied upon "proof of a federally defined violation." (168) This may include federal statutory violation, unsuccessful defense of a federal civil suit, or state law which has been adopted by federal statute. (169) An important consideration would be weighing the differences between the corporate form being used to evade a federal policy and merely taking advantage of legal options and protection available through incorporation. (170) The true objective of federal veil piercing is to determine whether a federal policy has been evaded through the "abuse of the corporate form, not to use the violation as an excuse to justify piercing the corporate veil." (171) Courts "should be able to discern between the use and abuse of the corporate form." (172)

V. CONCLUSION

The Constitution grants Congress the power "to regulate Commerce with foreign Nations," but what about between foreign Nations? (173) What stake do U.S. courts have in disputes between citizens of foreign nations whose only connection to the U.S. is property situated in the U.S.? Is the aspiration to the uniform application of federal maritime law more important than the laws of foreign nations regulating companies incorporated under the laws of the foreign nation? These are just some of the questions which arise from disputes between citizens of foreign nations seeking remedies and procedures in U.S. courts.

A newly designed approach is needed to ensure all factors are fairly weighed, due process of the law is followed, and uniform application occurs across all districts. Automatic application of federal common law would not serve this purpose, as the Second Circuit correctly ruled in Blue Whale. (114) In the wake of the attachment frenzy during the Winter Storm era, (175) a closer examination of the ease of piercing the corporate veil (which is supposed to be an extreme remedy) in Rule B attachments is needed. This is especially true for the veil piercing of foreign corporations using U.S. based law.

The current robotic application of Lauritzen-Rhoditis-Romero for all conflict of laws issues stemming for admiralty and maritime actions is unpredictable and not uniformly applied across all Circuits. (176) The Lauritzen-Rhoditis factors were designed for maritime personal injury or death cases, and are ill-suited for other maritime tort conflicts. The Lauritzen-Rhoditis factors are even more ill-suited to contract disputes. (177) The Supreme Court has not revisited Lauritzen, but hopefully, should it revisit its decision, the Court will develop a more cohesive approach to maritime conflict of laws, especially for conflicts involving foreign elements. (178)

Lance C. Bullock (*)

(*) J.D. Candidate 2019, Loyola University New Orleans College of Law; B.A. 2008, Louisiana State University.

(1) "'Freight' is not cargo but is a charge for transportation--the reward payable to the carrier for the carriage and delivery of goods." THOMAS J. SCHOENBAUM, ADMIRALTY AND MARITIME LAW, [section] 7-6 (5th ed. 2012).

(2) "Demurrage is a reparation paid to the shipowner to compensate for vessel time lost." THOMAS J. SCHOENBAUM, ADMIRALTY AND MARITIME LAW [section] 8-15 (5th edition 2012).

(3) FED. R. CIV. P. SUPP. B. (2012).

(4) "In general, a contract relating to a ship in its use as such, or to commerce or navigation on navigable waters, or to transportation by sea or to maritime employment is subject to maritime law and the case is one of admiralty jurisdiction, whether the contract is to be performed on land or water... In order to be considered maritime, there must be a direct link between the contract and the operation of the ship, its navigation, or its management afloat." STEVEN F. FRIEDELL, 1 BENEDICT ON ADMIRALTY [section] 182, at 12-4 to 12-6 (7th rev. ed. 1999). The following have been held to lie within admiralty jurisdiction: "Suits on contracts for the carriage of goods and passenger; for the chartering of ships (charterparties); for repairs, supplies, etc., furnished to vessels, and for services such as towage, pilotage, wharfage; for the services of seamen and officer; for recovery of indemnity premiums on maritime insurance policies." GRANT GILMORE & CHARLES L. BLACK, JR., THE LAW OF ADMIRALTY [section] 1-10, 22 (2d ed. 1975).

(5) William Tetley, Q.C., Arrest, Attachment, and Related Maritime Procedures, 73 TUL. L. REV. 1895, 1898 (1999).

(6) Loberiza v. Calluna Maritime Corp., 781 F. Supp. 1028, 1031-32 (S.D.N.Y. 1992) (explaining the "tramp trade" in the maritime shipping industry as going from port to port soliciting charters).

(7) Charles S. Donovan, Picking the Shipowner's Poison--Choice-of-Law Clauses and Maritime Liens, 14 U.S.F. MAR. L.J. 185, 186 (2001-2002) (quoting Manetti-Farrow, Inc. v. Gucci Am. Inc., 858 F. 2d 509, 514 n. 4 (9th Cir. 1988)).

(8) Blue Whale Corp. v. Grand China Shipping Development Co.. Ltd., 722 F.3d 488 (2d Cir. 2013).

(9) RICHAED A. LORD, 22 WILLISTON ON CONTRACTS [section] 58:5 (4th ed.).

(10) Id.

(11) Id.

(12) Id.

(13) Id.

(14) RICHARD A. LORD, 22 WILLISTON ON CONTRACTS [section] 58:5 (4th ed.).

(15) Id.

(16) Id.

(17) William Tetley, Q.C., Arrest, Attachment, and Related Maritime Procedures, 73 TUL. L. REV. 1895, 1900 (1999).

(18) Id.

(19) Id. at 1901.

(20) Id.

(21) Id. at 1899.

(22) Gina M. Venezia, The B, C, D's, of the Admiralty Rules: Obtaining Security for Your Claims, 27 U.S.F. MAR. L.J. 241, 242 (2014-2015).

(23) FED.R. CIV. P. SUPP. B(2012).

(24) ''Quasi in rem, like true in rem, jurisdiction is premised on the court's pre-judgement dominion and control over property. Quasi in rem proceedings traditionally shared in rem's important jurisdictional characteristic that the locus of the property within the forum state was, by itself, sufficient to establish jurisdiction." PETER HAY, PATRICK BORCHERS & SYMEON SYMEONIDES, CONFLICT OF LAWS [section] 5.6 (5th ed. 2010).

(25) William Tetley, Q.C., Arrest, Attachment, and Related Maritime Procedures, 73 TUL. L. REV. 1895, 1936 (1999).

(26) Gina M. Venezia, The B, C, D's, of the Admiralty Rules: Obtaining Security for Your Claims, 27 U.S.F. MAR. L.J. 241, 243 (2014-2015). See also Western Bulk Carriers (Austrailia), Pty. Ltd. v. P.S. Intern., Ltd., 762 F. Supp. 1302, 1306 (1991).

(27) Robert Force, Anthony J. Mavronicolas, Two Models of Maritime Dispute Resolution: Litigation and Arbitration, 65 TUL. L. REV. 1461, 1472 (1991).

(28) Id.

(29) Martin Davies, Litigation Fights Back: Avoiding the Effect of Arbitration Clauses in Charterparty Bills of Lading, 35 J. MAR. L. & COM. 617, 617 (2004).

(30) Id.

(31) 9 U.S.C. [section] 1 et seq. (2012).

(32) Martin Davies, Litigation Fights Back: Avoiding the Effect of Arbitration Clauses in Charterparty Bills of Lading, 35 J. MAR. L. & COM. 617, 617 (2004).

(33) Id.

(34) Id.

(35) Id.

(36) Id.

(37) Martin Davies, Litigation Fights Back: Avoiding the Effect of Arbitration Clauses in Charterparty Bills of Lading, 35 J. MAR. L. & COM. 617, 618 (2004).

(38) Robert M. Jarvis, Maritime Arbitration, 1 ALTERNATE DISPUTE RESOLUTION IN FLORIDA [section] 8.1, (Continuing Legal Educ. Comm. of the Florida Bar ed.1995).

(39) Id.

(40) Id.

(41) Id.

(42) Id.

(43) Robert M. Jarvis, Maritime Arbitration, 1 ALTERNATE DISPUTE RESOLUTION IN FLORIDA [section] 8.1, (Continuing Legal Educ. Comm. of the Florida Bar ed.1995).

(44) DIAN TOOLEY-KNOBLETT AND DAVID GRUNING, 24 LA. CIV. L. TREATISE, SALES [section] 1:18 (2012).

(45) Id.

(46) Id.

(47) RESTATEMENT (SECOND) OF CONFLICTS OF LAWS [section] 187 (1971).

(48) RESTATEMENT (SECOND) OF CONFLICTS OF LAWS [section] 188 (1971).

(49) Charles S. Donovan, Picking the Shipowner's Poison--Choice-of-Law Clauses and Maritime Liens, 14 U.S.F. MAR. L.J. 185, 187 (2001-2002). See also Lauritzen v. Larsen, 345 U.S. 571, 582 (1953); M/S BREMEN v. Zapata Off-Shore, 407 U.S. 1, 11 (1972).

(50) Lauritzen v. Larsen, 345 U.S. 571 (1953).

(51) Id. at 573.

(52) Id.

(53) Id.

(54) Id.

(55) Lauritzen v. Larsen, 345 U.S. 571, 582 (1953).

(56) Id. at 583-89.

(57) Id. at 583-86 (n.14 and n.19).

(58) M/S BREMEN v. Zapata Off-Shore, 407 U.S. 1, 2 (1972).

(59) Id.

(60) Id.

(61) Id. at 3.

(62) Id. at 3-4.

(63) BREMEN, 407 U.S. 1, 4 (1972).

(64) Id. at 6.

(65) Id. (quoting Carbon Black Export, Inc. v. The MONROSA, 254 F 2d. 297 (5th Cir. 1958), cert, dismissed, 359 U.S. 180 (1959)).

(66) Id. at 7.

(67) Id. at 10.

(68) BREMEN, 407 U.S. 1, 11 (1972).

(69) Berkey v. Third Ave. Ry. Co., 244 N.Y. 84, 94 (N.Y. Ct. App. 1926).

(70) Anderson v. Abbott, 321 U.S. 349, 361 (1944).

(71) Id.

(72) Id. at 362.

(73) Id.

(74) Berkey, 244 N.Y. at 95.

(75) Anderson, 321 U.S. at 362 (1944).

(76) Id.

(77) James K. Dumont, Pleading Insanity on Piercing the Corporate Veil: Supplemental Rule E's Heightened Pleading Standard Protects Polluting Shipowners in the Fourth Circuit, 38 TUL. MAR. L.J. 665, 670 (September 2014).

(78) Id.

(79) Id. at 671.

(80) Winter Storm Shipping Ltd. v. TPI, 310 F. 3d 263, 265 (2d Cir. 2002).

(81) Id.

(82) Id. at 273.

(83) Id. at 274.

(84) Id. at 279.

(85) Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58, 72 (2d Cir. 2009).

(86) Id. at 71.

(87) Blue Whale Corp. v. Grand China Shipping Dev. Co., 722 F.3d 488, 491 (2d Cir. 2013).

(88) Id.

(89) Id.

(90) Verified Complaint at 3, Blue Whale Corp. v. Grand China Shipping Development Co., 2013 WL 12129270 (S.D.N.Y. 2013) (No. l:12-cv-02213-AJN).

(91) Id.

(92) Id.

(93) Id.

(94) Id.

(95) Verified Complaint at 3, Blue Whale Corp. v. Grand China Shipping Development Co., 2013 WL 12129270 (S.D.N.Y. 2013) (No. l:12-cv-02213-AJN).

(96) Id. at 3.

(97) Id. at 4.

(98) Original Complaint at 7, Blue Whale Corp., 2013 WL 12129270 (No. 1:12-cv-02213-AJN); Plaintiffs Exhibit 1 at 3, Blue Whale Corp., 2013 WL 12129270 (No. l:12-cv-02213-AJN).

(99) Plaintiffs Exhibit 1 at 15, Blue Whale Corp. v. Grand China Shipping Development Co., 2013 WL 12129270 (S.D.N.Y. 2013) (No. l:12-cv-02213-AJN).

(100) Verified Complaint at 1, Blue Whale Corp., 2013 WL 12129270 (No. 1:12-cv-02213-AJN).

(101) Id. at 10-12.

(102) Id. at 6-7.

(103) Id.

(104) Id. at 7.

(105) Blue Whale Corp., 2013 WL 12129270, at *6.

(106) Id. at *2.

(107) Id. at *4 (citing In Re Tyson, 433 B.R. 68, 89 (S.D.N.Y. 2010)).

(108) Id. at *5 (citing FR 8 Singapore Pte. Ltd. v. Albacore Maritime Inc., 794 F. Supp. 2d 449, 460 (S.D.N.Y. 2011)).

(109) Id. (citing FR 8 Singapore Pte. Ltd., 794 F. Supp. 2d at 460).

(110) Blue Whale Corp., 2013 WL 12129270, at *5.

(111) Id.

(112) See Blue Whale Corp.,722 F. 3d at 493-498.

(113) See id. at 498-500.

(114) Id. at 500.

(115) Id. at 493.

(116) Id. at 492.

(117) Blue Whale Corp.,722 F. 3d at 493.

(118) Harley Mullion & Co. v. Caverton Marine Ltd., 2008 WL 4905460, at *2 (S.D.N.Y. Aug. 7, 2008).

(119) Al Fatah Int'l Nav. Co. v. Shivsu Canadian Clear Waters Tech. (P) Ltd., 649 F. Supp. 2d 295, 300 (S.D.N.Y. 2009).

(120) Blue Whale Corp.,722 F.3d at 495.

(121) Id.

(122) Id.

(123) Id.

(124) Id. at 498.

(125) SYMEON C. SYMEONIDES, CHOICE OF LAW 643 (2016). See Lauritzen v. Larsen, 345 U.S. 571 (1953); Romero v. Int'l Terminal Operating Co., 358 U.S. 354 (1959); Hellenic Lines v. Rhoditis, 398 U.S. 306 (1970).

(126) SYMEON C. SYMEONIDES, CHOICE OF LAW, 643 (2016).

(127) Blue Whale Corp.,722 F.3d at 499-500.

(128) Smith Kline & French Labs. v. Bloch L1983] 2 All E.R. 72, 74 (Denning, MR).

(129) Martin Davies, Symposium: Troubled Waters--Admiralty Law: Insurance, Pollution, and Finance Issues, 83 TUL. L. REV. 1435, 1435 (June, 2009).

(130) Id. at 1435.

(131) Id.

(132) Id.

(133) Id. at 1435-1436.

(134) Martin Davies, Symposium: Troubled Waters--Admiralty Law: Insurance, Pollution, and Finance Issues, 83 TUL. L. REV. 1435, 1436 (June, 2009).

(135) Alejandro M. Garro, Codification Technique and the Problem of Imperative and Suppletive Laws, 41 LA. L. REV. 1007, 1007 (1981).

(136) Id.

(137) Richard M. Buxbaum, Facilitative and Mandatory Rules in the Corporation Law(s) of the United States, 50 AM. J. COMP. L. SuPP. 249, 252-53 (2002).

(136) Id. at 252.

(136) Edgar v. MITE Corp., 457 U.S. 624, 645 (1987).

(140) Kamen v. Kemper Fin, 500 U.S. 90, 106 (1991).

(141) CTS Corp. v. Dynamics, 481 U.S. 69, 90 (1987).

(142) Jurisdiction, BLACK'S LAW DICTIONARY (2d ed. 1910) (Older edition was cited for specific wording).

(143) Am. Sugar Ref. Co. v. Anaconda, 138 F. 2d 765, 766-67 (5th Cir. 1943).

(144) Id.

(145) RESTATEMENT (SECOND) OF CONFLICT OF LAWS [section] 307 (1971).

(146) Id.

(147) Kirno Hill v. Holt, 618 F. 2d 982, 985 (2d. Cir. 1980) (citing Gartner v. Synder, 607 F. 2d 582, 586 (2d Cir. 1979)); Interocean Shipping Co. v. National Shipping and Trading Co., 523 F. 2d 527, 539 (2d Cir. 1975)).

(148) Northern Tankers (Cyprus) Ltd. v. Backstrom, 967 F. Supp. 1391, 1399 (Dist. Conn. 1997).

(149) American Fuel Corp. v. Utah Energy Dev. Co., 122 F. 3d 130, 134 (2d Cir.1997) (citing Morris v. New York State Dept. of Taxation and Finance, 623 N.E. 2d 1157, 1161 (N.Y. 1993)).

(150) Bridas II, 447 F.3d 411, 416-17 (5th Cir. 2006) (citing In re Sims, 994 F.2d 210, 217-18 (5th Cir.1993); United States v. Jon-T Chems., Inc., 768 F. 2d 686 (5th Cir. 1985); Edwards Co. v. Monogram Indus., Inc., 730 F. 2d 977, 984 (5th Cir. 1984)).

(151) Bridas I, 345 F. 3d 347, 359 (5th Cir. 2003) (citing American Fuel Corp. v. Utah Energy Dev. Co., 122 F. 3d 130, 134 (2d Cir. 1997)).

(152) Chao v. Occupational Safety & Health Review Comm'n, 401 F. 3d 355, 364 (5th Cir. 2005) (explaining that '"[t]his slight variation is of no consequence, however, because the end result under both views is the same-two separate entities merge into one for liability purposes'") (quoting Maiz v. Virani, 311 F. 3d 334, 346 n. 11 (5th Cir.2002)).

(153) White Rosebay Shipping S.A. v. HNA Group Co., Ltd., 2012 WL 6858239, note 4 (S.D. Tx. 2012).

(154) Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd., 460 F.3d 434, 447 (2d Cir. 2006).

(155) Blue Whale Corp.,722 F. 3d 488, 500 (2d Cir. 2013).

(156) Vitol S.A. v. Capri Marine Ltd., 2011 U.S. Dist. LEXIS 132206, *10-11 (D. Md. 2011).

(157) Id.

(158) LA. CIV. CODE ANN. art. 3515 (2017).

(159) LA. CIV. CODE ANN. art. 3537 (2017).

(160) LA. CIV. CODE ANN. art. 3542 (2017).

(161) Piercing the Corporate Law Veil: The Alter Ego Doctrine Under Federal Common Law, 95 Harv. L. Rev. 853, 864 (1982).

(162) Id. at 865.

(163) Id.

(164) Id. at 866.

(165) Id.

(166) Piercing the Corporate Law Veil: The Alter Ego Doctrine Under Federal Common Law, 95 HARV. L. REV. 853, 866 (February 1982).

(167) Id.

(168) Id.

(169) Id. at 867-68.

(170) Id. at 868.

(171) Piercing the Corporate Law Veil: The Alter Ego Doctrine Under Federal Common Law, 95 HARV. L. REV. 853, 870 (February 1982).

(172) Id.

(173) U.S. Const. art. I, [section] 8, cl. 3 (emphasis added).

(174) Blue Whale Corp. v. Grand China Shipping Dev. Co., 722 F.3d 488, 491 (2d Cir. 2013).

(175) Winter Storm Shipping Ltd. v. TPI, 310 F.3d 263 (2d Cir. 2002).

(176) PETER HAY, PATRICK BORCHERS & SYMEON SYMEONIDES, CONFLICT OF LAWS [section] 17.63 (5th ed. 2010).

(177) SYMEON C. SYMEONIDES, CHOICE OF LAW, 670 (2016).

(178) PETER HAY, PATRICK BORCHERS & SYMEON SYMEONIDES, CONFLICT OF LAWS [section] 17.63 (5th ed. 2010).
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