Consumer Class Actions and Mass Torts : Class Action Lawyer & Attorney : J. Russell Jackson : Skadden Law Firm : Complex Class Actions : Consumer Class Actions & Mass Torts Law Blog

Increasingly, foreign plaintiffs want to use US courts to adjudicate disputes that arose overseas.  The Texas Court of Appeals' decision in Lalila v. Parker Drilling Co., 2009 WL 618248 (Tex. App. -- Houston [1st Dist.] Mar. 12, 2009), is a good example of a court's use of the doctrine of forum non conveniens to control its docket and avoid adjudication of such disputes.

In Lalila, 766 Bangladeshis sued a number of defendants in Texas state court over two gas well explosions in Tangratila, Bangladesh, asserting causes of action in negligence, nuisance, trespass, and conversion.  The Texas defendants moved to dismiss for forum non conveniens.  The trial court granted the motion, which the appellate court reviewed for abuse of discretion.

Texas is one of the few states to have codified the rules relating to forum non conveniens.  That statute provides that if an act or omission occurring in Texas was a proximate or producing the injury, then forum non conveniens dismissal is not available.  The court noted, however, that both proximate and producing cause require "causation in fact," which "means the defendant's act or omission was a substantial factor in bringing about the plaintiff's injury, which would not otherwise have occurred."  The court reviewed the various acts that plaintiffs alleged occurred in Texas (design of the rig and parts, negligent supervision of the gas well project), concluding that plaintiffs' complaint never connected them up to the injuries suffered in Bangladesh in such a way as to meet the "causation in fact" requirement.

The court then proceeded to evaluate Bangladesh as a forum.  The court rejected plaintiff's criticism of the courts as corrupt, saying the evidence was based on hearsay from only three Bangladeshi attorneys.  The court gave little weight to the fact that Bangladeshi courts do not have a class action procedure, noting that it has joinder and is a judicial system based on English common law that has the types of torts asserted by Lalila.

The court also noted the legal inability and prohibitive costs of bringing witnesses from Bangladesh and translating their testimony, as well as the fact that the vast majority of evidence resides in Bangladesh.  The court concluded that the balance of public and private interests clearly weighed in favor of Bangladesh.  And thus, the court concluded that the trial court did not abuse its discretion in dismissing the case for foreign non conveniens.

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A recent decision from a federal district court in Massachusetts raises interesting issues regarding the effect of rulings in competing class actions.  In Gintis v. Bouchard Transportation Co., 2009 WL 95661 (D. Mass. Jan. 15, 2009), a tugboat and barge had strayed off course while navigating a shipping canal.  They collided with a reef, resulting in up to 98,000 gallons of oil being spilled into Buzzards Bay, contaminating real property all along the bay and requiring cleanup.

Buzzards Bay property owners had sued the defendants in both state and federal court in Massachusetts.  The state court had declined to certify a class of propertyowners from across the bay, finding that the named representatives from the town of Mattapoisett could not adequately represent the interests of a baywide class.  The state court ultimately did, however, certify a class of Mattapoisett residents.

In federal court, both the plaintiffs and defendants sought to use the state court decision offensively, urging that the order merited collateral estoppel effect.  The defendants sought to hold plaintiffs to the state court's determination that a baywide class was not certifiable.  The plaintiffs sought to hold defendants to the state court's determinations on the individual elements of Rule 23.

The court in Gintis rejected both assertions of collateral estoppel.  The court acknowledged that the Seventh Circuit has held that a court's denial of certification can be conclusive against absent proposed class members.  Id. at *2 (citing In re Bridgestone/Firestone, Inc. Tires Prods. Liab. Litig., 333 F.3d 763, 768 (7th Cir. 2003)).  But that can only be the case where the absent class members were adequately represented by class counsel.  Because the state court had held that the named plaintiffs there could not adequately represent other bay propertyowners, the state court's decision denying certification of a baywide class could not have collateral estoppel effect.

The court in Gintis similarly rejected the plaintiffs' attempt to give nonmutual offensive collateral estoppel effect to the state court's conclusions about predominance, superiority, and other elements of Rule 23.  It reasoned that plaintiffs could not easily have joined the earlier state court action, and further it would be fundamentally unfair to apply collateral estsoppel to defendants because the state court's determinations on the elements of Rule 23 were made based on assumptions about a much smaller and manageable Mattapoisett-only class.

Having dispensed with the collateral estoppel arguments, the district court proceeded to analyze whether the proposed class of more than 1,000 property owners from around the bay should be certified.  The plaintiffs argued that there were good grounds to certify the class for at least liability and causation determinations, leaving the calculation of damages to be determined subsequently on an individual basis. 

The court ultimately held that the predominance and superiority requirements were not satisfied because determining liability and causation on the public nuisance theory would require the same kind of individualized inquiry that a damages determination would require:

[T]he proposed class members would have to show that there has been an "unreasonable interference with a right common to the general public" and some "special injury of a direct and substantial character."  A showing of "unreasonable" interference and "special," "direct," and "substantial" injury would require an examination into the individual characteristics of the proposed class members' properties and the extent of contamination.

Id. at *5.  In reaching this conclusion, the court relied heavily on the decision in Church v. General Electric Co., 138 F. Supp. 2d 169 (D. Mass. 2001), in which a court refused to certify a class to determine whether PCB contamination constituted public nuisance and trespass for riparian landowners.

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