Project Codu Plaintiffs vs. ATI Want Case Remanded to State Court

The plaintiffs in the breach of contract complaint against American Tower International (ATI) want their lawsuit remanded to the 11th Judicial Circuit Court in Miami-Dade County where it originated before ATI removed it Jan. 3 (see 2301030035), said their motion Thursday (docket 1:23-cv-20009) in U.S. District Court for Southern Florida in Miami.

Plaintiffs Terra Towers, TBS Management and DT Holdings allege ATI improperly withdrew from an $800 million Latin American telecom tower project contract called Project Codu (see 2301030035). Their motion to remand came two days after ATI moved to dismiss the complaint on grounds a contract was never in place for ATI to breach (see 2302010002).

The plaintiffs want the case remanded because the parties stipulated to facts during their underlying arbitration proceedings “that negates the existence of subject matter jurisdiction in this cause,” said their motion. The court also should remand the proceedings because ATI “is judicially estopped from effectuating removal of these proceedings pursuant to the removal procedure set forth under the New York Convention,” it said.

Section 205 of the convention permits a defendant to remove an action to federal district court “where the notice of removal describes an arbitration agreement” that may be governed by the convention and where the subject agreement “sufficiently relates to the case pending before the district court such that it could conceivably affect the outcome of the case,” said the motion. ATI asserts the district court has subject matter jurisdiction over the breach of contract action set forth in the plaintiffs’ state court complaint, it said. As ATI now sees it, this breach of contract action is “inextricably intertwined” with the parties’ underlying arbitration that is governed by the convention.

But the plaintiffs “asserted this identical breach of contract action” in its original counterclaim in the underlying arbitration, said the motion. At that time, though, ATI and its Peruvian subsidiary “raised a jurisdictional challenge to this identical breach of contract claim” in the underlying arbitration, arguing the arbitration provisions within the parties’ Project Codu contract “did not relate to or in any way encompass this specific claim,” it said.

ATI’s “then position” on this issue was accepted during the early phases of the underlying arbitration, said the motion. The plaintiffs agreed to withdraw their breach of contract action for the Project Codu contract without engaging in motion practice or otherwise seeking the “arbitral tribunal’s interjection,” it said.

ATI removed to the district court the breach of contract complaint filed in state court “on the inconsistent ground” that the convention permits removal in these circumstances because the Project Codu agreement is now, solely for removal purposes, “inextricably intertwined” with the parties’ underlying arbitration, said the motion. The court should reject ATI’s attempt to remove these proceedings “on the misleading and disingenuous ground” that the breach of contract action in the state court complaint is related to the parties’ underlying arbitration, and therefore subject to removal under the convention, it said.