CASE: BP CHEMICALS LTD v.

JIANGSU SOPO CORPORATION GROUP LTD

(2005)

QUESTION: Identify the legal status of SOPO in the lawsuit initiated by BP

Chemicals under the Foreign Sovereign Immunity Act in 1976 of the United States.

BRIEF STRUCTURE
I. Definition
1. What is the Sovereign Immunity Act?
2. In what situation can a company/ country apply a sovereign act?
II. Case brief
1. Characters mentioned in the case study
2. Situation between those characters
III. Case analysis
1. sopo đã vi phạm điều gì
2. phán quyết của tòa
3. trả lời câu hỏi
IV. Conclusion
V. Questions

I. CASE BRIEF (NHẮC LẠI CẢ CÂU HỎI CỦA CÔ) - Dương, Quỳnh
(Kiểu khi mà làm slide mình sẽ làm kiểu:
Đây là BP - BP là abcxyz
Đây là Sopo - Sopo là abcxyz
Vào năm X BP và Sopo đã..

1. BP: Plaintiff BP Chemicals Ltd. is a British corporation with its principal place of
business in London, England. Among other businesses, BP is involved in the design and
construction of commercial plants used to manufacture acetic acid through a process
known as methanol carbonylation. When BP bought the methanol carbonylation
process from Monsanto, it also stepped into Monsanto's shoes with respect to existing
license agreements Monsanto had with third parties. One of those licenses had been
granted to a Taiwanese company known as China Petrochemical Development
Corporation (CPDC).

2. SOPO: Defendant Jiangsu SOPO Corporation (Group) Ltd. is a Chinese state-owned

petrochemical company. SOPO is the owner of the “921 plant,” which is an acetic acid
plant located in Zhenjiang City, Jiangsu Province, People’s Republic of China.
 Production at the 921 plant began in 1998. SOPO is a large enterprise which has
significant ties to the local Chinese Communist Party.

What kind of company is Sopo?

Sopo is a chemical company organized under the laws of China and wholly-
owned by the Chinese government

3. In 1990, the People's Republic of China (China) approved the building of a major acetic
acid factory in Zhenjiang City. This project became known as the 921 project (the “92”
signifying the year 1992, and the “1” signifying the month of January). In 1992, SOPO
contracted with SPECO for the latter to design and construct the 921 plant for SOPO as
the ultimate end user and owner. SPECO thereafter contracted with a number of vendors
in the United States to fabricate the specialized equipment needed for a methanol
carbonylation acetic acid plant, supposedly utilizing “home-grown” technology, that is,
technology developed by a Chinese chemical research institute for a low-pressure
methanol carbonylation process

4. SPECO: In 1988, a business enterprise called the Shanghai Petrochemical Engineering

Company (SPECO) was formed to engage in major chemical engineering projects in
China.

5. The group of vendors who specialize in fabricating equipment needed for a methanol
carbonylation acetic acid plant is relatively small. Monsanto and BP (and their licensees)
had used these same vendors for all of their licensed plants worldwide. Thus, the vendors
were familiar with the specifications they would regularly receive utilizing BP's trade
secrets for its methanol carbonylation process. One of them is Nooter Corporation,
located in St. Louis, Missouri, who supplied the SOPO plant with nineteen key pieces of
equipm2`ent..

This case involves the alleged misappropriation of trade secrets for a process used
to manufacture acetic acid, a chemical component used in inks, plastics, resins,
and fabrics. This process was developed by Monsanto in the 1960s - 1970s and
then bought by BP in 1986. Both corporations had the right to license the process
to third parties and in this case, neither Sopo nor SPECO was licensed. BP alleges
that Chinese defendants Jiangsu Sopo Corporation (Group) Ltd. ("Sopo") and
Shanghai Petrochemical Engineering Co. ("SPECO") wrongfully acquired BP
trade secrets and ultimately incorporated them into Sopo's acetic acid plant located
in China, which is also known as the "921 plant". Defendant Nooter Corp., a
Missouri corporation, manufactured key components of the 921 plant. Sopo and
SPECO allegedly sent bid packages and technical specifications containing BP's
trade secrets to Nooter and to several other United States companies that also
provided equipment or supplies for the plant.
II. PHÂN TÍCH CASE (TẤT CẢ CHỦ THỂ HÀNH ĐỘNG, LUẬT, PHÁN
QUYẾT) + ĐƯA RA CÂU TRẢ LỜI CHO CÂU HỎI CỦA CÔ
Sopo luôn của nhà nước nhưng có commercial act

1. Diễn biến - Lan, Hằng

The thing you have to always remember is that “No state may exercise legal
jurisdiction over another”. - SOVEREIGN IMMUNITY

The FSIA provides the only basis for exercising jurisdiction over a foreign state in
the courts of the US. Under the FSIA, foreign sovereigns are immune from suit in
the United States except to the extent that the Act provides otherwise that we have
to distinguish whether it’s a commercial act. If a foreign state has made a prima
facie showing of immunity, the burden is on the party seeking to invoke the court's
jurisdiction to show that one of the FSIA's exceptions applies.

In 1995, BP noticed that some of the specialized vendors had received bid
specification packages from SPECO for Sopo's 921 plant that were very similar to
specifications used by BP in prior licensed projects. Until 2/1999, BP filed this
action in Missouri district court against Sopo, SPECO and Nooter Corporation
with allegation that the parties misappropriated BP's trade secrets in violation of
the Missouri Uniform Trade Secrets Act (MUTSA). Sopo brought a motion to
dismiss the action for lack of subject matter jurisdiction alleging immunity from
suit because their actions was not insufficient on their face to fall within the
“commercial activity carried on in the United States" exception to immunity under
the FSIA meanwhile Nooter settled with BP for an undisclosed sum, and the terms
of the settlement, in part, require Nooter to cooperate with BP in its action against
Sopo.

BP alleges that SOPO, acting with others, unlawfully obtained access to BP’s
acetic acid technology and that SOPO copied the specifications for its 921 plant
from one of BP’s licensed plants in Asia. According to BP, SOPO disclosed the
wrongfully acquired trade secrets to a number of vendors in the United States, who
used BP’s stolen trade secrets to fabricate and provide items for SOPO’s use in the
921 plant.

BP did not dispute that Sopo is a presumptively immune "foreign state" under the
FSIA. BP argued, however, that the "commercial activities" exception found in 28
U.S.Code, Section 1605 subjects Sopo to this court's jurisdiction. BP also claimed
SOPO used” or disclosed" the trade secrets in meetings with the American vendors
which occurred in the US acting through its alleged agent, SPECO.
=> BP alleges, however, that SPECO was Sopo's agent and that SPECO's
contacts with the United States should therefore be attributed to Sopo for
jurisdictional purposes. Moreover, BP's proposed second amended complaint
adds allegations that Sopo and SPECO conspired with others to misappropriate
BP's trade secrets.

Thus, BP then amended its complaint to add allegations of a civil conspiracy

between Sopo and SPECO.

But there’s no evidence that SPECO acted as SOPO's agent when it met with
American vendors. All supply contracts with Nooter and other United States
vendors were executed by SPECO, not by Sopo itself. There is no evidence that
Sopo sent any direct communications to the United States vendors, although
Sopo employees visited the vendors in the United States for training and
equipment inspections.

The two sides continued to argue back and forth about whether SPECO is an
agency of Sopo or not; whether Sopo is entitled to Sovereign Immunity, and
whether that is an exception under the FSIA 1976 ?

After holding an evidentiary hearing, the district court rejected BP’s theory that
there existed a relationship between Sopo và SPECO, but agreed with BP that
SOPO's own activity within the US territory was sufficient for jurisdiction under
the FSIA.

The district court focused on a number of vendor meetings in which SOPO

representatives directly participated, 2 main categories were the Nooter meetings
and the meetings with all other vendors
Trục thời gian 1994 - 1996
 The Nooter meetings
 The Spring 1994
 6/1995
 8/1995
 The meetings with all other vendors
 In the summer of 1995 - Fisher-Rosemount, Burnsville, Minnesota
 In May of 1995 - Hobart Corp., Troy, Ohio
 In July of 1995 - Baird Co.
 In August of 1995 - Lightnin, Rochester, New York
 In September of 1995 - A Company Near Boston, Massachusetts
 In September of 1995 - BW/IP plant, Tulsa，Oklahoma
 In 1995 and another in late 1996 or early 1997 - Haynes International, In
May of 1996 - Measurementation, Inc., Chino California Four.
  In the summer of 1996 - Phoenix Co., Houston， Texas
 In August of 1996 - ABB Co., Ohio
 Kokomo, Indiana

At least 20 employees of SOPO traveled to at least 11 vendors between 1994 and

1996. During these meetings, amongother things, SOPO employees
inspected and tested equipment for the 921 Plant and trained for its ultimate
use. SOPO's personnel on numerous occasions participated in technical
discussions regarding the construction of the plant and the equipment being
ordered from the U.S. vendors. The discussions at the meetings relatedto
equipment being built by the vendors using the allegedly stolen trade secrets.
Since the discussion concerned equipment being built from stolen
specifications, BP's trade secrets were “used” during these meetings.

Under the MUTSA, BP's claim consists of the following elements:

1. SOPO used BP's trade secrets without BP's express or implied consent
2. At the time of the use, SOPO knew or had reason to know that knowledge
of the trade secret was derived from or through a person (SPECO)
who had utilized improper means to acquire it.

BP contends the evidence considered by the district court demonstrates SOPO

used BP's trade secrets without BP's consent, and the use is connected to
SOPO's own commercial activity in the US

SOPO counters that BP's evidence and the district court's fact findings are not
specific enough to survive its factual challenge to jurisdiction. SOPO claims proof
that itsrepresentatives were present during the various vendor meetings, and
that equipment for the 921 plant was discussed during those meetings, is
insufficient to show that SOPO itself used BP trade secrets during the meetings.
SOPO also cites several cases for the proposition that it was incumbent upon
the district court to identify the specific conduct of SOPO representatives
during the vendor meetings to show they used BP's trade secrets

2. Phán quyết của tòa - Tú, Minh Anh

 Lần kiện thứ nhất: In the first appeal, the appeal court held BP's pleadings
survived a facial jurisdictional challenge brought by SOPO pursuant to the FSIA
 Lần kiện thứ hai (vụ kiện của case): In this appeal, the court determine whether
BP marshaled sufficient facts in support of its pleadings to survive SOPO's
factual jurisdictional challenge under the FSIA, and whether SOPO had sufficient
contacts with the State of Missouri for the district court to exercise personal
jurisdiction over it
  The result of the appellate court was that the district court annulled the sentence
and released SOPO back to the country on the grounds that it was incorrect for
Sopo to enjoy immunity. The court want the district court to retry and issue a
different sentence

 DISTRICT COURT ĐANG BẮT ĐẦU XỬ LẠI VỤ ÁN, BỞI VÌ:

 SOPO contended the pleadings were insufficient on their face to fall within the
“commercial activity carried on inthe United States” exception to immunity under
the FSIA, and thus that the defendant was not immune from suit—based on the
evidence.
 SOPO counters that BP's evidence and the district court's fact findings are not
specific enough to survive its factual challenge to jurisdiction. SOPO claims proof
that its representatives were present during the various vendor meetings,
and that equipment for the 921 plant was discussed during those meetings, is
insufficient to show that SOPO itself used BP trade secrets during the meetings.

CÁC CHẤP THUẬN TÒA ÁN ĐƯA RA TRONG VỤ KIỆN THỨ 2

 The district court agreed and granted the motion, holding BP’s suit against SOPO
focused on the wrongful acquisition of BP’s trade secrets, and SOPO did not
acquire any of BP’s trade secrets in the United States.
 With respect to SOPO's “sufficient contacts” personal jurisdiction challenge, The
district court focused on this same commercial activity, in particular the Nooter
meetings which occurred in Missouri, and concluded SOPO had sufficient
minimum contacts with Missouri for the court to exercise personal jurisdiction
over SOPO


Personal Jurisdiction:
 The district court found SOPO had sufficient contacts with the United States to fit
within the commercial activity exception of the FSIA. It’s believed that it’s
dispositive of the related issue of whether SOPO had sufficient minimum contacts
with an American forum that it could be expected to be haled into court there.

3. Trả lời câu hỏi của cô + opinion

Identify the legal status of SOPO in the lawsuit initiated by BP Chemicals under the
Foreign Sovereign Immunity Act in 1976 of the United States.
 SOPO là công ty như thế nào ( xác định loại hình công ty, xác định owner vs
user, vốn, cổ phần,...)
  Vốn: 100% vốn nhà nước
 Loại hình doanh nghiệp: Company Limited (Công ty trách nhiệm hữu hạn)
 Was listed on Shanghai Stock Exchange in 1996 with stock code 600746
 Owner: The government of the People's Republic of China.
 SOPO có thuộc foreign sovereign không? - YES
 Because SOPO is an entity wholly-owned by China, it’s considered a
“foreign state” under the FSIA, and is presumptively immune from suit in
American courts
 Vì sao hoạt động của SOPO lại thuộc ngoại lệ thương mại điều chỉnh bởi
FSIA
According to 28 U.S.Code Section 1605 “the action is based upon a commercial
activity carried on in the United States by the foreign state; or upon an act
performed in the United States in connection with a commercial activity of the
foreign state elsewhere; or upon an act outside the territory of the United States in
connection with a commercial activity of the foreign state elsewhere and that act
causes a direct effect in the United States.”

Let’s take a look at this case:

1. First, Sopo engaged in the commercial activity of constructing and
operating the 921 plant in China.
2. Secondly, Sopo engaged in the commercial activity of contracting with
United States vendors to provide equipment for the 921 plant.
Moreover, SOPO's direct participation in vendor meetings during which
equipment utilizing trade secrets stolen from BP was discussed, inspected and
tested.
Therefore, all these proof subjects Sopo to this court's jurisdiction

 DỰ BÁO PHÁN QUYẾT CUỐI CÙNG:

 SOPO purportedly obtained and used BP trade secrets for Project 921 through a
total of 12 meetings, including 2 with Nooter in Missouri and 10 with the other
Vendors in the US, with the participation of SOPO and SPECO representatives.
 SOPO is the ultimate end user and owner of 921 plant (even though SPECO does
engage in the meeting with vendors and use BP’s trade secrets) so SOPO have
responsible for compensating BP

CONCLUSION (KHẲNG ĐỊNH LẦN NỮA ĐÁP ÁN CÂU HỎI CỦA CÔ)
1. Because SOPO is an entity wholly-owned by China, so it’s considered a “foreign
state” under the FSIA, and is presumptively immune from suit in American
courts. A claim can be brought against a foreign sovereign, however, if the action
is “based upon a commercial activity carried on in the US.”
=> Kđ câu trl cho câu hỏi của cô