Vacatur of Attachment ≠ Dismissal

Shagang Shipping Company Limited v. HNA Group Co., Ltd., 2018 WL 1517670 (W.D. WA., March 28, 2018)

After obtaining a judgment in England in excess of $68 million for breach of a charter agreement, Shagang sought to attach golf courses in Washington pursuant to Rule B. It alleged that the guarantor on the charter agreement and other defendants “abused the corporate form.” HNA along with the other defendants filed a motion to vacate the attachment and to dismiss under Rule 12(b)(6).The trial judge first addressed the legal burden of proof of Shagang which for purposes of the motion to vacate the attachment is higher than the requirements under Rule 12(b)(6).  Shagang had to make a prima facie showing that the corporate alter ego was used for fraudulent purposes or to conduct the business of the controlling corporation rather than its own.The court determined that Shagang failed to establish a prima facie case of an alter ego theory and vacated the Rule B attachment. However, it did not dismiss the case noting that even if jurisdiction based on maritime attachment is lacking, dismissal is not automatic.