Products Liability Law Daily Malaysia Airlines Flight MH370 lawsuits belong in Malaysia
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Monday, January 13, 2020

Malaysia Airlines Flight MH370 lawsuits belong in Malaysia

By Georgia D. Koutouzos, J.D.

The United States is not the appropriate forum in which to litigate claims against either the airline or the manufacturer of the ill-fated aircraft.

The federal trial court overseeing the multidistrict action arising from the March 2014 disappearance of Malaysia Airlines Flight MH370 did not abuse its discretion in concluding that Malaysia, and not the United States, was the most convenient forum in which to litigate Montreal Convention-based claims against Malaysia Airlines as well as products liability and wrongful death claims against Boeing Co., the U.S. Court of Appeals for the District of Columbia Circuit ruled, affirming the trial court’s dismissal of the U.S.-based lawsuits on forum non conveniens grounds (In re Air Crash over the Southern Indian Ocean on March 8, 2014 (Smith v. Malaysia Airlines Berhad) , January 10, 2020, Rao, N.).

Malaysia Airlines Flight MH370 disappeared somewhere over the Southern Indian Ocean en route from Kuala Lumpur International Airport in Malaysia to Beijing, China, on March 8, 2014, after which a four-year search yielded no definitive answers as to the whereabouts of the aircraft or the cause of its presumed crash. Representatives of many of the passengers filed lawsuits in the United States, asserting claims under the Montreal Convention against the airline as well as state-law products liability and wrongful death claims against Boeing Co., which had manufactured the at-issue B-777 aircraft.

The actions were centralized into a multidistrict litigation in the U.S. District Court for the District of Columbia, after which Boeing and Malaysia Airlines jointly moved to dismiss on forum non conveniens grounds. The trial court granted the motion, concluding that Malaysia is a more convenient forum in which to hear all claims. The representatives appealed the trial court’s decision.

Standard of review. A party seeking dismissal for forum non conveniens bears the burden of showing both: (1) that an adequate alternative forum is available to hear the dispute; and (2) if so, that the balance of certain public and private interest factors strongly counsels in favor of trying the dispute in the alternative forum. Furthermore, under U.S. Supreme Court precedent, the forum non conveniens determination is committed to the trial court’s discretion and is afforded substantial deference, subject to reversal only for clear abuse of discretion.

Adequacy of forum. In the case at bar, the trial court did not abuse its discretion when it concluded that Malaysia is an adequate, available forum for the representatives’ Montreal Convention and state-law products liability/wrongful death claims, the appellate panel found. Malaysia’s enactment of a law that transferred all the assets of the air carrier that had operated the flight to the carrier that replaced it as Malaysia’s national airline without deeming the replacement carrier a successor entity to its predecessor did not render that country an inadequate forum for litigation of the representatives’ claims, the panel said, noting that the operating carrier appeared to have an insurance policy that would apply to the representatives’ Montreal Convention claims. Even assuming that the law rendered the operating carrier judgment-proof, a U.S. forum would not provide any greater likelihood of redress, the panel held, adding that because a group of representatives had failed to raise any challenge to the adequacy of tort damages under Malaysian law before the trial court, those arguments were forfeited.

In any event, in the context of a forum non conveniens inquiry, a foreign forum is not inadequate merely because it has less favorable substantive law, the panel instructed. Where, as here, it appears undisputed that an alternative forum would provide a plaintiff at least some remedy, a trial court acts within its discretion in deeming that forum an adequate alternative to a U.S. court, the panel advised.

Public and private interest factors. Nor did the lower court clearly abuse its discretion in concluding that the balance of relevant public and private interest factors weighs heavily in favor of trying appellants’ cases in Malaysia, the panel instructed. The trial court found that Malaysia’s public interest in hearing claims arising out of Flight MH370’s disappearance far outweighed that of the United States, even as to the tort claims asserted against U.S.-based manufacturer Boeing. The trial court further held that the private interest factors tilted strongly in favor of trying these cases in Malaysia given the overwhelming amount of evidence and witnesses located in Malaysia and the potentially insurmountable challenges that would arise from attempting to make that evidence available in a United States court.

Choice of forum. The trial court also correctly recognized that the starting point for the forum non conveniens analysis is a strong presumption in favor of a plaintiff’s chosen forum. However, the precise degree of deference afforded that choice varies depending on the plaintiff’s connection to the forum—i.e., a plaintiff who chooses to sue in his home forum receives the strongest presumption, whereas a foreign plaintiff with minimal or no connections to the United States is entitled to less deference.

Accordingly, the trial court afforded the representative of one of the three U.S. citizens on the missing flight the highest degree of deference and tailored its analysis of the remaining plaintiffs’ interests in having their claims heard in the United States to their particular circumstances. The trial court’s analysis reflected a careful consideration of the foreign plaintiffs’ interests in trying the cases in the United States as well as a thoughtful balancing of the public and private interest factors with respect to those individuals specifically. Because the lower court concluded that even the substantial interest in trying claims in the United States of the U.S. citizen’s representative could not overcome the significant evidentiary problems posed by proceeding in a U.S. court, the panel found that it necessarily followed that the foreign plaintiffs—who were entitled to less deference—could not succeed in showing that the balance of interests weighed in favor of maintaining their claims here.

Sovereign immunity. The representatives argued that the trial court erred by declining to first reach the separate sovereign immunity challenges raised by the air carrier and its replacement and then relying on the existence of potentially intractable immunity questions as a justification for its forum non conveniens dismissal. That argument incorrectly suggested that the lower court had treated the carriers’ immunity challenges as granted for purposes of the forum non conveniens analysis, however.

In addition, the trial court did not impermissibly "leapfrog" the immunity questions and then rely on the same unresolved immunity issues to deny the representatives their chosen forum. Instead, it merely conducted a preliminary assessment of the carriers’ immunity claims and concluded that "[t]he potential of intractable immunity questions that might stymie Boeing’s ability to implead other defendants raises the prospect of precisely the kind of oppressive and vexatious outcome that forum non conveniens dismissal is designed to avoid." Boeing and the Malaysian carriers raised serious arguments regarding the carriers’ likely immunity, and it was entirely proper for the trial court to have recognized that serious jurisdictional questions exist and to have weighed that as a factor in favor of dismissal.

As for the representatives’ contention that the trial court placed undue weight on sovereign immunity concerns as a private interest factor favoring dismissal, the lower court’s opinion made clear that the court had considered all relevant circumstances, including the potential immunity issues, and had concluded that taken as a whole, the private interest factors favored dismissal of the claims. Therefore, because there was no clear abuse of discretion in the trial court’s reasoning, its decision was affirmed.

The case is Nos. 18-7193, 18-7195, 18-7196, 18-7197, and 18-7198.

Attorneys: Mary F. Schiavo (Motley Rice LLC) for Elizabeth Smith. Telly Andrews (KMA Zuckert LLC) for Malaysia Airlines Berhad, d/b/a Malaysia Airlines and Allianz Global Corporate and Specialty. Mack Harrison Shultz, Jr. (Perkins Coie LLP) for Boeing Co.

Companies: Boeing Co.; Malaysia Airlines Berhad, d/b/a Malaysia Airlines; Allianz Global Corporate and Specialty

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