Del. Forum Non Conveniens Doctrine Doesn't Depend on Adequate Alternative Forum
Corporations sued in Delaware and subject to jurisdiction here sometimes employ the doctrine of forum non conveniens (FNC) to seek dismissal of the litigation if defending here would create an overwhelming hardship. In a recent decision from Delaware's Superior Court, Judge Vivian L. Medinilla provided important guidance about the doctrine and affirmed that in the final analysis it remains a defendant-centric test, as in Hupan v. Alliance One International, Del. Super. C.A. No. N12C-02-171 VLM (Aug. 25). The FNC doctrine recognizes the substantial weight given to a plaintiff's choice of forum by permitting a defendant to displace the Delaware forum only upon demonstrating "overwhelming hardship" if forced to litigate here. When a defendant can demonstrate such hardship, however, Hupan makes clear that dismissal is appropriate even if the plaintiff is not assured of an alternative forum to bring its claims. AsHupan illustrates, the doctrine has particular relevance to suits brought by foreign plaintiffs seeking recovery for harm incurred in foreign lands, governed by foreign law and requiring extensive use of foreign language.
In Hupan the plaintiffs were 23 Argentine tobacco farmers and their children. They claimed that the children suffered birth defects as a result of the parents' exposure to dangerous chemicals during the cultivation of tobacco in Argentina.
The plaintiffs brought suit in Delaware Superior Court. Two of the defendants Philip Morris Global Brands Inc. (PM Global) a Delaware corporation, and Philip Morris USA (PM USA), a Virginia corporation, (collectively, the FNC defendants) moved to dismiss the action on FNC grounds. The court applied Delaware's traditional Cryo-Maid factors to evaluate the FNC motions: the relative ease of access to proof; the availability of compulsory process; the possibility of a view of the premises; whether the controversy depends on the application of Delaware law; the pendency or nonpendency of a similar action in another jurisdiction; and all other factors that would make trial of the case easy, expeditious and inexpensive.
Analyzing these factors in light of the evidence of hardship offered by the FNC defendants, the court found that they had met their burden of showing that it would present an overwhelming hardship for the FNC defendants to defend the action in Delaware. Specifically, the court focused on the extreme difficulty and expense of gathering critical evidence and trying the case when the plaintiffs resided in Argentina, allegedly suffered their injuries there, novel issues of Argentine law would control and the unsettled provisions would have to be interpreted based on non-English text. Indeed, the Hupan facts tracked closely the facts from a recent Delaware Supreme Court decisions upholding dismissal of Argentine plaintiffs' claims on FNC grounds, as in Martinez v. E.I. DuPont de Nemours, 86 A.3d 1102 (Del. 2014), as revised (Mar 4, 2014).
Following dismissal of their claims on FNC grounds, the plaintiffs moved for reargument and clarification. The plaintiffs argued that before ever applying the Cryo-Maid factors, a Delaware court ruling on a FNC motion must first address as a threshold matter whether there existed an "adequate alternative forum" with jurisdiction over the moving defendants and no statute of limitations bar. The plaintiffs also requested that the court impose conditions on dismissal to assure the presence of an adequate forum in Delaware or elsewhere. The court denied reargument.
The court acknowledged that the existence of an adequate alternative forum was an element of federal FNC law. It ruled, however, that each state is free to develop its own FNC doctrine and that Delaware had not included this element as a threshold consideration. Rather the pendency or non-pendency of an action elsewhere was one of several factors subsumed within the Cryo-Maid analysis to be considered in determining whether the defendant has met its burden of showing overwhelming hardship if forced to litigate in Delaware.
Finally, the court rejected the conditions requested by the plaintiffs, including conditioning FNC dismissal on reinstatement of their claims in Delaware if the claims brought in another forum were time-barred, or personal jurisdiction over the defendants there could not be obtained. Apart from procedural deficiencies with this belated request to impose conditions, the court reasoned that plaintiffs' request for reinstatement in Delaware, if granted, effectively would vitiate its previous finding that defendants would suffer overwhelming hardship if forced to litigate here.
Although this case arose in the context of foreign nationals asserting foreign tort claims, the FNC analysis applies to business disputes as well, (see, e.g., IMZ Merchandizing & Manufacturing v. Tirex, (Del. Ch. Nov. 2, 2000). Even defendants who are incorporated in Delaware but faced with overwhelming hardship if forced to litigate claims here, may utilize the FNC doctrine to obtain relief. Moreover, defendants facing overwhelming hardship need not consent to conditions requiring them to waive defenses or otherwise facilitate suit in another jurisdiction as the price of escaping suit in Delaware.