Adolf Lony v. E.I. Du Pont de Nemours & Company, 886 F.2d 628, 3rd Cir. (1989)
Adolf Lony v. E.I. Du Pont de Nemours & Company, 886 F.2d 628, 3rd Cir. (1989)
Adolf Lony v. E.I. Du Pont de Nemours & Company, 886 F.2d 628, 3rd Cir. (1989)
2d 628
Paul F. Doyle (argued), Kelly, Drye & Warren, New York City, for
appellant.
William H. Sudell, Jr. (argued), J. Judson Scaggs, Jr., Morris, Nichols,
Arsht and Tunnell, Wilmington, Del., for appellee.
Before HIGGINBOTHAM, GREENBERG, and HUTCHINSON, Circuit
Judges.
OPINION OF THE COURT
A. LEON HIGGINBOTHAM, Jr., Circuit Judge.
I. INTRODUCTION
1
Plaintiff Adolf Lony, a small West German business, appeals from the
dismissal by the district court of its suit in United States District Court for the
District of Delaware against E.I. Du Pont de Nemours & Co., a Delaware
Corporation, on grounds of forum non conveniens. For reasons that follow, we
find that the district court erred in failing to consider adequately and to
determine the amount of deference due the choice of forum of a foreign
plaintiff when suit is brought on the defendant's home ground and much of the
evidence is located there. We also find that it clearly erred in the conclusion it
drew from its weighing of the private interest factors and in its assessment of
the applicability of local law in its weighing of the public interest factors.
Because these errors constitute an abuse of discretion that alters the outcome of
the forum non conveniens analysis, we will vacate the order of dismissal and
remand this case for further proceedings.1
II. FACTS AND PROCEDURAL BACKGROUND
2
Appellant Adolf Lony ("Lony") is a sole proprietorship with its principal place
of business in the Federal Republic of Germany ("Germany"). Joint Appendix
("App.") at 909. It prints and processes cellophane and plastic films into
wrappers for food and other products. App. at 910-11. Appellee E.I. Du Pont de
Nemours & Co ("Du Pont") is a Delaware corporation with its principal place
of business in Delaware. App. at 909-10. In addition, Du Pont's research
laboratories and its Flexible Packaging Division headquarters are located in
Delaware. App. at 481, 354-56. Du Pont is the largest private employer in the
state. App. at 481.
Lony claims that in August of 1985, Haribo asked Lony whether the cellophane
packaging provided by Lony for its candy contained diethylene glycol
("DEG"), and specified that the cellophane used for Haribo candy must be free
of DEG. App. at 10, 13. The concern was apparently prompted by a widely
publicized scandal at that time over the presence of DEG in some European
foods and wines. App. at 910. Lony claims that it asked Transparent whether or
not the Du Pont cellophane was free of DEG, and that Transparent forwarded
the question to Du Pont and forwarded Du Pont's reply to Lony. App. at 10-11.
In October 1985, William Percival, of the Regulatory Affairs Group of Du
Pont's Polymer Products Department in Wilmington, wrote to Transparent:
App. at 557. Lony claims that Percival was aware that he was responding to a
customer's inquiry because he stated in a postscript, "[t]hanks for your
explanation regarding the reason for your questions." Id.; Appellant's Brief
("Applt's Br.) at 4.
Lony alleges that in December 1985 and January 1986, following Du Pont's
assurances, Lony shipped candy wrappers made with Du Pont cellophane to
Haribo; in May 1986, Haribo tested the candy wrappers it had received from
Lony, found they contained DEG, severed its business relationship with Lony,
and drove Lony to the brink of bankruptcy. App. at 13-14. Lony asserts that
Haribo returned the unused wrappers. App. at 309-10, 341-42. Subsequently,
Lony and Haribo renewed their business relationship. App. at 896.
10
In June 1986, Du Pont sold its entire cellophane business to Flexel, Inc.
("Flexel"). App. at 597-601. Lony asserts that all of Du Pont's records relating
to the cellophane business were transferred to Flexel and that Flexel now
employs personnel who worked for Du Pont at the time period relevant to this
litigation. App. at 85, 98, 597-601.
11
Lony brought this suit in Delaware on June 15, 1988, claiming tortious
misrepresentation, common law fraud, statutory fraud, breach of warranty, and
breach of fiduciary duty. In response to Du Pont's forum non conveniens
motion, the district court stayed discovery in the case except that related to
identifying witnesses, records and their location. App. at 78, 402. After briefing
and oral argument on the motion, the court granted it on November 14, 1988,
subject to a number of conditions (App. at 930-31): the West German courts
must entertain at least one of Lony's claims; Du Pont must submit to
jurisdiction in West Germany; it must facilitate trial proceedings in West
Germany by making available at its own expense any documents, witnesses or
other evidence in its custody or control that a West German court determines
might be needed and by providing translations where appropriate; it must agree
to pay any damages, costs and fees awarded by West German courts; finally,
Du Pont must consent to Lony's reinstitution of the suit in the United States
without prejudice should any of the other conditions fail. Id. Upon judgment
entered, Lony appealed.
12
Lony alleges that critical evidence necessary to proving its claims is located in
the United States, primarily in Wilmington and in Tecumseh, Kansas. Applt's
Br. at 9-19. It identified witnesses and documents regarding the following: Du
Pont's decision to use PEG in the manufacture of cellophane; its purchasing of
PEG; its use of PEG in the manufacturing process; the way in which the use of
PEG in the manufacturing process resulted in DEG in the cellophane; the
knowledge on the part of people at the Tecumseh plant and at Du Pont's
Regulatory Affairs Group in Wilmington that the use of PEG in manufacturing
cellophane would result in DEG in the finished product; and the ability of Du
Pont to identify its cellophane. Id. It further claims that some of the witnesses
and documents are now outside of Du Pont's control. The employees and
documents of the Tecumseh plant are now in the control of Flexel, and other
former Du Pont workers are now retired. Id. Those witnesses and documents
would not be readily available for trial if the case were heard in West Germany.
13
Du Pont, for its part, has denied that PEG in the manufacturing process causes
DEG to be present in cellophane. App. at 28. It claims that critical evidence
necessary to its defense and to the proof of damages is located in Europe. For
the most part, it does not specifically identify, but rather asserts the presence of,
documents and witnesses regarding the following: the causal link between the
presence of any DEG in Du Pont cellophane and Haribo's termination of its
business relationship with Lony; tests done in Europe allegedly establishing the
presence of DEG in the cellophane; the life history of the cellophane after it
entered Lony's control which might explain the presence, or an increased level,
of DEG in the wrappers; the claim that it was Du Pont cellophane that was used
in the wrappers; and the amount of Lony's damages. Appellee's Brief
("Applee's Br.") at 8-10. Du Pont asserts that those witnesses and documents
would not be readily available if the case were heard in the United States.
III. DISCUSSION
14
Our scope of review in this matter is limited. The motion to grant or deny a
forum non conveniens motion lies within the sound discretion of the district
court. "[W]here the court has considered all relevant public and private interest
factors, and where its balancing of these factors is reasonable, its decision
deserves substantial deference." Piper Aircraft Co. v. Reyno, 454 U.S. 235,
257, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981).2 Therefore, "our review is limited
to consideration of whether the district court abused its discretion, and we do
not perform a de novo resolution of forum non conveniens issues." Lacey v.
Cessna Aircraft Co. 862 F.2d 38, 43 (3d Cir.1988).
15
We have previously stated that a district court abuses its discretion in a forum
non conveniens analysis when it fails to consider adequately and to determine
the amount of deference due the foreign plaintiff's choice of forum (Id. at 4546) or when it clearly errs in weighing the factors to be considered. Id. at 43
(citing Reyno v. Piper Aircraft Co., 630 F.2d 149, 160 (3d Cir.1980).
16
We have recently restated the grounds for dismissing a case for forum non
conveniens in Lacey, 862 F.2d at 38, which came out shortly before the ruling
in this case and was first brought to the attention of the district court in the
motion for rehearing. In Lacey, as in the instant case, the plaintiff was not a
United States citizen or resident and the defendant was a Pennsylvania
manufacturer of the product that allegedly was responsible for the damage.3
The standard is stated as follows:
17district court may, in the exercise of its sound discretion, dismiss a case "when an
A
alternative forum has jurisdiction to hear the case, and when trial in the chosen
forum would 'establish ... oppressiveness and vexation to a defendant ... out of all
proportion to the plaintiff's convenience,' ... Piper, 454 U.S. at 241, 102 S.Ct. at
258.... (quoting Koster [v. American Lumbermens Mutual Casualty Co.], 330 U.S. at
524 [67 S.Ct. 828, 832, 91 L.Ed. 1067] [ (1947) ]. In deciding whether to dismiss a
case for forum non conveniens, "the ultimate inquiry is where trial will best serve
the convenience of the parties and the ends of justice." Koster, 330 U.S. at 527, 67
S.Ct. at 833....
18
....
19
... However, the plaintiff's choice of forum should rarely be disturbed, unless
the balance of factors is strongly in favor of the defendant.
20
Lacey, 862 F.2d at 42-43. The opinion also emphasizes that the defendant bears
the burden of persuasion as to all elements of the forum non conveniens
analysis. Id. at 43.
21
24
The appellant Lony claims that in dismissing the suit on grounds of forum non
conveniens the district court abused its discretion in several respects. Lony
contends the court accorded no deference to Lony's choice of forum, placed the
burden of persuasion on the plaintiff rather than on the defendant where it
belonged, and clearly erred in weighing the private and public interest factors,
making several omissions and errors of law and fact. We shall review each of
Lony's claims.
25
26
We noted that, under Piper, a district court must "consider the availability of an
adequate alternative forum and the amount of deference to be accorded the
plaintiff's choice of forum before it weighs the private and public interest
factors relevant to the forum non conveniens inquiry." Lacey, 862 F.2d at 45
(citation omitted). Lony apparently does not appeal the district court's finding
that West Germany is an adequate alternative forum. As the Supreme Court
stated in Piper, "[o]rdinarily, this requirement will be satisfied when the
defendant is 'amenable to process' in the other jurisdiction," except in the "rare
circumstances ... where the remedy offered by the other forum is clearly
unsatisfactory," such as when "the alternative forum does not permit litigation
of the subject matter of the dispute." Piper, 454 U.S. at 255 n. 22, 102 S.Ct. at
265 n. 22. In this case, two conditions of dismissal were Du Pont's submission
to the jurisdiction of the West German courts and the West German courts'
willingness to entertain at least one of Lony's claims. App. at 930-31.
Moreover, Lony does not maintain that any remedy available in West Germany
would be "clearly unsatisfactory." Lony argues, rather, that the district court
28
29
When
the home forum has been chosen, it is reasonable to assume that this choice is
convenient. When the plaintiff is foreign, however, this assumption is much less
reasonable. Because the central purpose of any forum non conveniens inquiry is to
ensure that the trial is convenient, a foreign plaintiff's choice deserves less
deference.
30
31
Because the reason for giving a foreign plaintiff's choice less deference is not
xenophobia, but merely a reluctance to assume that the choice is a convenient
one, that reluctance can readily be overcome by a strong showing of
convenience. In ruling on a forum non conveniens motion, the district court
must indicate the amount of deference it is giving to plaintiff's choice. Lacey,
862 F.2d at 45. Where a foreign plaintiff has made a strong showing of
convenience, we hold that the district court must indicate how far that showing
goes toward putting the foreign plaintiff on the same footing as a domestic
plaintiff.
32
The district court had the following to say on the amount of deference due
plaintiff's choice of forum:
33
[L]ess
deference is given to a plaintiff's choice of forum where the plaintiff is not a
United States citizen or resident.
34
35
36
Lony maintains that the district court merely restated the rule, failed to say how
much deference it gave to the plaintiff's choice of forum, as required by Lacey,
and, in fact, gave it no deference at all. Applt's Br. at 27; Applt's Reply Br. at 1.
Du Pont reads the district court's statements as indicating that the court
considered the question and granted some deference to the plaintiff's choice,
but found that dismissal was nonetheless warranted. Applee's Br. at 16-17.
37
We cannot say that the district court gave no deference at all to plaintiff's
choice of forum, but it did little beyond restating the rule and filling in the
names of the parties. In this case, more than that is required of the district court.
The foreign plaintiff is suing the defendant in the latter's home forum where the
latter's corporate headquarters, headquarters of the division in question, and
research laboratories are located. That in itself has considerable weight in
showing that the plaintiffs choice was based on convenience. In addition, the
plaintiff has taken pains to show that much of the evidence it needs to establish
liability is located in the forum it chose, and the conduct that caused the alleged
injury issued from Delaware. If the plaintiffs do not prove liability, they have
lost the case; thus, particularly where the liability evidence predominates in the
plaintiff's choice of forum, the court should be quite cautious in disregarding
such an essential fact of the litigation.
38
deference is due this plaintiff's choice of forum, if, indeed, it is due any less
than that of a domestic plaintiff. The district court's failure to give adequate
consideration to these questions and to make a determination based on the facts
of this case was an abuse of discretion and constitutes reversible error.
C. Private Interest Factors
39
In Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S.Ct. 839, 91 L.Ed. 1055 (1947),
the Supreme Court stated that the relevant private interest factors to be
considered in a forum non conveniens analysis include
40
relative
ease of access to sources of proof; availability of compulsory process for
attendance of unwilling, and the cost of obtaining attendance of willing, witnesses; ...
and all other practical problems that make trial of a case easy, expeditious and
inexpensive. There may also be questions as to the enforceability of a judgment if
one is obtained.
41
Id. at 508, 67 S.Ct. at 843; see also Piper, 454 U.S. at 241 n. 6, 102 S.Ct. at 258
n. 6; Lacey, 862 F.2d at 46. Moreover, as the Supreme Court recently stated:
42 examine "the relative ease of access to sources of proof," and the availability of
To
witnesses, the district court must scrutinize the substance of the dispute between the
parties to evaluate what proof is required, and determine whether the pieces of
evidence cited by the parties are critical, or even relevant, to the plaintiff's cause of
action and to any potential defenses to the action.
43
Van Cauwenberghe v. Baird, 486 U.S. 517, 108 S.Ct. 1945, 1953, 100 L.Ed.2d
517 (1988) (quoting Gulf Oil, 330 U.S. at 508, 67 S.Ct. at 843).
44
The district court in the instant case noted the private interest factors set forth
in Gilbert, and introduced its analysis with the statement that "[e]ach of these
factors ... favors dismissal." App. at 920. After completing its analysis of the
private interest factors, however, the court seemed to depend on its erroneous
treatment of the deference due a foreign plaintiff's choice of forum. It stated,
"Thus, remembering that 'when a plaintiff is a foreign citizen and is not suing
in his home forum, the presumption of ... plaintiff's convenience is less
reasonable and deserves less deference,' we find that the balance of private
factors, if not at equipoise, is tipped toward dismissal." App. at 924.
45
Insofar as the district court's assessment of the balance depended on the court's
apparent view that less deference is always due the foreign plaintiff's choice of
forum, that will have to be re-examined when the district court inquires on
remand into whether less deference is due the choice in this case, and if so,
how much less. Since that view seemed to affect the court's assessment of the
balance of private interest factors, we assume that without it the court would
have found the balance of those factors either at equipoise or tipped toward the
plaintiff.
46
Even without that correction, Lony correctly challenges the legal significance
that the district court gave its assessment of the private interest factors. The
district court found that "the balance of private factors, if not at equipoise, is
tipped toward dismissal." App. at 924. We agree that this is an erroneous
conclusion. If the balance of private interest factors is close to equipoise, as the
district court found it to be, that would not favor dismissal. Du Pont had the
burden of establishing that "trial in the chosen forum would 'establish ...
oppressiveness and vexation to a defendant.... out of all proportion to plaintiff's
convenience.' " Piper, 454 U.S. at 241, 102 S.Ct. at 258. When the court found
the private interest factors to be "at equipoise" (or tipped toward the defendant),
it should have concluded that they weighed in favor of retaining jurisdiction,
not that they tipped "toward dismissal." App. at 930.
47
We shall next review the court's assessment of the specific private interest
factors for plain error, apart from its dependence on an assumption of lesser
deference due the choice of forum of a foreign plaintiff and the significance it
gave to its finding that the private interest factors were almost evenly balanced.
48
The district court set out Lony's two liability issues as presented in its brief as
follows: "(1) Is DEG present in cellophane manufactured using PEG 300 as a
raw material? And, (2) If so, did DuPont know or should it have known this?"
The court acknowledged that "it is true that many witnesses are located in the
United States." App. at 921. It reasoned, however, that the first issue could be
proved by European experts as easily as by Du Pont's experts in the United
States. On the issue of knowledge, the court found that its condition that Du
Pont "make available, and translate into German where appropriate at its own
expense, any documents, witnesses or other evidence in its custody or control"
would provide all the evidence Lony needed. App. at 921.
49
In addition, the court noted that Lony could make available persons and
documents in the United States outside of Du Pont's control by using
procedures established by the Convention on the Taking of Evidence Abroad in
Civil or Commercial Matters ("Hague Convention"), opened for signature
March 18, 1970, 23 U.S.T. 2555, T.I.A.S. No. 7444. App. at 921-22. Rejecting
Lony's claim that trial in West Germany would result in the unavailability of
much important evidence, the court found that dismissal "may actually result in
more evidence being available in a West German courtroom." App. at 922. The
court based this assertion on its belief that under Hague Convention procedures
the evidence available to litigants in Germany seeking assistance from the
United States might be broader than that available to litigants in the United
States seeking assistance from West Germany. Id. Finally, the district court
found that much of the evidence as to the causation of Lony's alleged injuries
and as to damages was in West Germany. Id.
50
Lony does not dispute the correctness of the district court's statement of the two
liability issues. Applt's Br. at 35. It contends, however, that the district court
ignored the "massive factual record of potential witnesses in this case" that
Lony had provided, and required DuPont to present "no evidence whatsoever"
on its interests in changing the forum. Id. at 33-34. Lony claims that, as a result,
not only was the burden of persuasion improperly shifted, but the court reached
an erroneous conclusion.
51
As noted above, the district court is entitled to determine whether the evidence
offered by the parties is "critical, or even relevant" to prove or defend the
claims; indeed, it must do so to assess properly the relative ease of access to
sources of proof. Van Cauwenberghe, 108 S.Ct. at 1953. This means that, while
it may not simply ignore sources of evidence presented by Lony, the court may
judge them to be unnecessary or irrelevant.
52
With regard to the first liability issue, Lony identifies various persons who are
or were employed by Du Pont who could testify as to the use of PEG 300 in
manufacturing the type of Du Pont cellophane Lony ordered. The court rightly
concluded that this testimony is unnecessary. Since Du Pont has admitted that it
used PEG in the manufacture of the type of cellophane Lony purchased, Lony
does not need evidence located in the United States to show that Du Pont used
PEG 300; it does not need any evidence at all on that point.
53
Lony also identifies evidence in the United States that it claims is needed to
establish that the PEG 300 used in the manufacture of Du Pont cellophane type
K160DB23 was responsible for DEG in the finished product. Du Pont's
position, which the district court adopted, is that any expert witnesses could
provide Lony with the testimony that the use of PEG as a raw material in the
manufacturing process will result in DEG in the finished cellophane.
Accordingly, Du Pont argues that witness on this point could easily be obtained
in Europe. App. at 921. Since Du Pont denies that the use of PEG as a raw
material caused DEG to be present in its cellophane, however, it seems
disingenuous of Du Pont to claim that Lony can make do with witnesses who
are and were unconnected with Du Pont. At trial, Du Pont would doubtless try
to refute the testimony of the foreign witnesses that it claims are all Lony
needs. Lony wants to put on witnesses who were working for Du Pont at the
Tecumseh plant when the cellophane was manufactured there and who would
testify to the manufacturing process used by Du Pont and the way in which the
DEG could get from the PEG into the cellophane in that process. Applt's Br. at
9-14. Because Du Pont contests Lony's claim that the PEG it used in the
manufacturing process resulted in DEG in the cellophane, Lony should not
have to make do with a presentation of evidence that may not withstand the
defense Du Pont would mount, but should be entitled to prove its claim in the
most direct and specific manner possible, linking the DEG in the cellophane to
Du Pont's own manufacturing process. The district court's conclusion that Lony
needs no access to sources of proof in the United States to prove the first issue
is not warranted. Lony would be greatly inconvenienced by not having ready
access to this evidence in the United States.
54
With regard to the second liability issue, Du Pont's knowledge that PEG in the
manufacturing process would result in DEG in the cellophane, Lony claims that
some of that information can be provided by documents and witnesses from the
Tecumseh plant, which are outside Du Pont's control, and some by documents
and witnesses in Du Pont's control in Wilmington. Applt's Br. at 17-19. Some of
this evidence may be cumulative, but, since Du Pont is denying knowledge,
Lony should be able to put forth whatever evidence it can as to the extent of Du
Pont's alleged knowledge, and should not be limited to proving what someone
in Du Pont's Wilmington headquarters knew or should have known. Since Du
Pont has agreed, as a condition of dismissal, to make available to the German
courts all of the evidence within its control, then its documents and personnel in
Wilmington would be readily available for trial in Germany. However, the
evidence provided by documents from the Tecumseh plant and by witnesses
who work there or formerly worked there would not be readily available in
Germany since they are no longer in Du Pont's control.4 Lony would be slightly
inconvenienced by not having access to it.
55
With regard to evidence located in Europe that Du Pont claims it needs, the
court found that much of the evidence as to causation of Lony's alleged injuries
and damages is in West Germany:
56
Specifically,
all of the DEG test results conducted in Germany by Haribo and the
West German Government on the wrappers that were allegedly made of DuPont
cellophane are in West Germany.... Information as to why Haribo terminated its
business relationship with Lony exists in West Germany, not here. Information as to
the amount of damages, both actual and those related to the loss of Lony's business
reputation, that Lony allegedly suffered because of Haribo's termination [is] in West
Germany.
57
App. at 922-23.
58
Lony asserts that much of the evidence Du Pont claims it needs is unnecessary
because Du Pont can identify its own cellophane by performing tests on it.
App. at 192, 218. Therefore, by testing the rejected wrappers that Haribo
returned to Lony, Du Pont can determine that the cellophane is its own. If true,
it would make unnecessary evidence in West Germany proving the chain of
control of the cellophane to show that the wrappers were actually made of the
Du Pont cellophane. Lony also claims that the test results from Germany and
German evidence on possible outside sources of contamination of the wrappers
would be irrelevant, since Lony plans to prove that the DEG was present in the
cellophane as manufactured.5 This evidence in Europe is considerably less
significant if Lony can prove that the cellophane contained DEG as
manufactured and that Du Pont can identify its cellophane conclusively.6
Barring such proof, Du Pont is considerably inconvenienced by not having
ready access to the evidence it claims it needs for its defense, but Lony's case is
correspondingly considerably weakened.
59
With regard to the reasons for Haribo's termination of business with Lony and
the damages, we agree with the district court that critical information is located
in Europe. Lony claims that the evidence Du Pont needs relating to damages is
in Lony's control, but Du Pont is entitled to go beyond the information in
Lony's records, and clearly the evidence of damage to reputation is not all in
Lony's control. Du Pont is greatly inconvenienced by not having this evidence
readily available.
60
We find that each of the parties has correctly identified some important
evidence in the forum of its choice and that the district court correctly ruled that
not all of the evidence so identified was necessary. While we might have found
that somewhat more of the evidence located in the United States to be
necessary to a proper determination of the case on its merits than did the district
court, we will reserve judgment as to whether the district court abused its
discretion in its assessment of the private interest factors until we have
reviewed all of them.
61
might result in more information being available if the trial were held in West
Germany. App. at 922. We find that that conclusion is a misreading of the
Hague Convention as it is affected by the procedural law of the respective
countries.7
62
In trials held in Germany, the parties do not direct the investigation to the same
extent that they do in the United States.8 They may recommend that the court
call certain witnesses or seek certain information, but the court may decide that
it does not need them. There is no pre-trial discovery. The trial may be a long,
rambling event, held intermittently over a period of months, during which the
court will call for whatever evidence it deems necessary. In general,
considerably less evidence is sought and introduced in a commercial trial in
Germany than in a comparable suit in the United States, largely because in
West German trials parties do not have access to an equivalent of our pre-trial
discovery. In the parties' discussion of the private interest factors, there is some
confusion as to what evidence would be available if the trial were held in West
Germany. In a forum non conveniens analysis we, like the district court, will
not consider the fact that the West German courts typically choose not to call
for the same amount of information as would be produced for trial in the
United States. We will consider only the relative ease of access to the evidence
and the availability of compulsory process to compel witnesses or documents
should the court wish to request them.
63
The West German courts have very limited power to order documents and none
to compel their production. With regard to documents in West Germany, their
production could not be compelled regardless of where the trial was held,
although testimony relating to them might be ordered for specific documents.
There are no fishing expeditions for documents such as often occur in discovery
in the United States.9
64
With regard to documents in the United States, a wide range of them could be
compelled if the trial were held in this country; if the trial were held in
Germany, few of them could be requested by the German courts through the
Hague Convention because of German procedural rules that limit requests for
documents for use in West German trials. Du Pont has agreed to make its
documents available in Germany, but third party documents such as those in the
control of Flexel would not be available under that agreement. Overall,
considerably more evidence in the form of documents would be available if the
trial were held in the United States.
65
least not in this case. In Germany, parties need not testify, even as to the
contents of their documents, but that immunity would be waived as to Du Pont
because one condition of dismissal is that Du Pont make available to the
German courts all witnesses and documents within its control. In either forum,
the courts can compel testimony from third parties within their jurisdictions,
and either country will honor requests from the other for the testimony of
witnesses.
66
The district court stated that if the case were tried in Germany more evidence
might be available because "there is a question of whether West Germany will
execute letters rogatory for the purpose of pretrial discovery ..." App. at 922.
We are uncertain what prompted this conclusion of the district court. The West
German courts have indicated that they will execute letters rogatory for pretrial
discovery to the extent that they would order such evidence if the case were
tried in their own courts, that is, they will order the examination of witnesses,
but not the production of documents.10 They could not compel those documents
for trial in Germany. Therefore the district court was in error in suggesting that
evidence that the German courts might refuse to provide for pretrial discovery
in response to letters rogatory would be available were the trial held in
Germany.
67
In considering whether the "choice of one forum over the other will alleviate
practical problems, making trial of the case expeditious and inexpensive," the
practical problem of the need to translate documents and the testimony of
witnesses is a relevant concern. Dahl v. United Technologies Corp., 632 F.2d
1027, 1031 (3d Cir.1980). Lony claims that none of the potential witnesses
from Du Pont speaks German, and that most of the potential German witnesses
speak English. Applt's Br. at 20. It adds that while "[n]umerous English
documents will have to be translated into German," id. at 38, "DuPont's
interrogatory responses disclosed that it had already translated into English
much of the German correspondence in this action." Id. at 20 (citing App. at
89). Du Pont responds that Lony greatly exaggerates its need for documents and
witnesses in the United States to prove its claims that there was DEG in the
cellophane and that Du Pont knew of it. Applee's Br. at 32. It adds that "[a]ll
other issues ... will be centered in Germany" and that Germany is therefore the
more convenient forum in terms of language concerns. Id.
68
The district court set as a condition of dismissal that Du Pont translate into
German at its own expense any evidence in its control which a German court
requested, but otherwise did not discuss the language issue. It seems that more
of the German witness speak English than the reverse, but there is evidence and
testimony on both sides that would have to be translated. We cannot say that the
balance favors one side or the other, and evidently the district court did not find
that it did either. The district court made no finding as to the relative costs of
trying the case in the two forums and neither party raised the issue on appeal.
69
70
71
In Piper, the Supreme Court described the relevant public interest factors in a
forum non conveniens inquiry as including
454 U.S. at 241 n. 6, 102 S.Ct. at 258 n. 6 (quoting Gulf Oil, 330 U.S. at 508,
73
454 U.S. at 241 n. 6, 102 S.Ct. at 258 n. 6 (quoting Gulf Oil, 330 U.S. at 508,
67 S.Ct. at 843): see also Lacey, 862 F.2d at 48. As we further noted in Lacey,
"[i]n evaluating the public interest factors the district court must 'consider the
locus of the alleged culpable conduct, often a disputed issue, and the
connection of that conduct to plaintiff's chosen forum.' " 862 F.2d at 49 (citing
Van Cauwenberghe, 108 S.Ct. at 1953).
74
The district court noted that "even when the private convenien[ce] of the
litigants are nearly in balance, a trial court has the discretion to grant forum non
conveniens dismissal upon finding that retention of jurisdiction will be unduly
burdensome to the community, that there is little or no public interest in the
dispute, or that foreign law would predominate if jurisdiction is retained." App.
at 924 (citing Pain, 637 F.2d at 791-92). The court found that dismissal was
warranted because "the public interest factors strongly favor dismissal." App. at
930. In analyzing the public interest factors, the court looked at three factors:
the nexus with the two jurisdictions, local interest in the issues in each
jurisdiction, and the interest in having the case tried in a forum familiar with
the law that governs the issues. App. at 924-30.
75
The district court first reasoned that while the case had a nexus with Delaware
because "Du Pont is incorporated in Delaware; Du Pont performed relevant
tests of the cellophane in question in Delaware; and the alleged
misrepresentations were made from Delaware to West Germany," App. at 925,
West Germany had both the larger number of contacts with the dispute and the
more important contacts. The court noted that the
76 scandal was centered in West Germany; Lony sold the cellophane in question
DEG
to Haribo in West Germany; Lony and Haribo both have their principal places of
business in West Germany; Lony's communications to [Transparent] and DuPont
seeking information about the DEG content of the cellophane in question originated
from West Germany; Haribo performed its cellophane tests and has records of these
tests in West Germany; Haribo terminated its business relationship with Lony in
West Germany; and any damage resulting from the termination of this relationship
occurred in West Germany.
Id.11
77
The court concluded that West Germany has the more important contacts to the
litigation (App. at 926) and that it also has the greater number of contacts,
though the court gave less weight to the latter factor. Clearly, both forums have
important contacts to the litigation. Here again, we might have reached a
somewhat different conclusion as to the importance of the contacts with the two
forums. In addition to the contacts with Delaware that the district court notes,
With regard to the second factor, local interest in the dispute, the district court
reasoned that West Germany had the stronger local interest because "[t]he DEG
scandal was centered in West Germany and Austria." App. at 926. It noted that
Delaware had a strong interest because every government has an interest in
"ensuring that businesses incorporated or operating within its borders abide by
the law." App. at 926. But it found that
79 government also has what we consider a stronger interest in ensuring that its
every
citizens do not come into contact with unsafe products imported within its borders.
West Germany is no exception to this rule. There can be no argument that whatever
harm occurred from the DEG scandal, it occurred in West Germany, not in
Delaware.
80
App. at 926-27.
81
The district court implies that the safety of the wrappers was an issue in this
case, and suggests that Lony should have alleged that the DEG content of the
wrappers exceeded the amount allowable by the West German government as
part of its claim as to why Haribo terminated their business relationship. The
court notes that "Lony fails to allege at any point that the level of DEG
allegedly present in the DuPont cellophane exceeded the West German
standard of 500 parts per million and, in effect, information as to why Haribo
terminated its business relationship with Lony exists in West Germany, not
here." App. at 923.
82
As Lony states, the case is not concerned with "the health dangers of DEG in
candy wrappers," but is, rather "a straight commercial [dispute] arising out [of]
Lony's requirement [that] DuPont cellophane be absolutely DEG free, and
specific representations to that effect by DuPont." Applt's Br. at 46. Lony
claims that the case "has nothing whatsoever to do with the levels at which
DEG is dangerous to health, or what those levels are considered to be in West
Germany." Id. It adds that public concern over the safety of products containing
DEG merely formed part of the background to the case and explains Haribo's
insistence that the wrappers for its candy contain no DEG.
83
Du Pont claims that Lony changed its position concerning the relevance of the
DEG scandal in Europe, noting that it included three pages of allegations about
the DEG scandal in its complaint (App. 4-7) and considerable material in the
appendix to its brief to the district court. Applee's Br. at 38. The fact that Lony
is now placing less emphasis on the DEG scandal as background to its case
does not change the fact that it never alleged that Du Pont's cellophane was
unsafe, nor does it make the West German government's interest in this case
that of "ensuring that its citizens do not come into contact with unsafe products
imported within its borders," as the district court states. App. at 926.
84
We find that the primary interest of the German government is similar to that of
Delaware. Delaware is interested in ensuring that businesses incorporated or
operating within its borders abide by the law; Germany is interested in insuring
that businesses selling their products within Germany or to German companies
abide by the law and do not engage in wrongful business practices or
misrepresent their products. In addition, we find that West Germany's interest
in the presence of DEG in products sold within its borders is implicated even
though this is a commercial dispute and even though there is no allegation that
the amount of DEG in the product exceeds the allowable West German
standard. Germany may be particularly concerned with misrepresentations
regarding the presence in an imported product of a chemical which has been the
subject of a major public health scandal, even if there was no allegation that the
level of the chemical present in the product exceeded acceptable limits and even
if it did not, in fact, exceed acceptable limits. Insofar as the district court based
its assessment of West Germany's stronger interest on its belief that the case
deals with the safety of products imported into West Germany, its analysis is
flawed, but we cannot say that its conclusion that West Germany has the
stronger interest in the case is an abuse of discretion.
85
The third public interest factor is the applicability of local law. Lony maintains
that the district court erred in determining that West German law would apply
to its claim of intentional misrepresentation and in ignoring its claims under
Delaware statutes. We agree.
86
If the case were heard in Delaware, the district court would, in a diversity case,
apply the choice of law rules of Delaware, the forum state. Klaxon Co. v.
Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed.
1477 (1941). The district court found that the application of Delaware's choice
of law rules did not produce a clear result, and turned to the Restatement
(Second) Conflict of Law Sec. 148.2 (1971) for guidance. App. at 927-29. The
district court noted that "[i]n Johnston Associates, Inc. v. Rohm & Haas, Inc.,
560 F.Supp. 916 (D.Del.1983), this Court held that in the case of intentional
88
In this case, the place of injury was Germany, but the place of the alleged
wrongful conduct, the misrepresentation that allegedly caused the injury, was
Delaware. Therefore, Delaware law will apply to Lony's claim of intentional
misrepresentation. Lony did not dispute the district court's finding that West
German law would apply to Lony's negligent misrepresentation and warranty
claims. App. at 929.
89
Lony also points out that the district court did not even mention the fact that
Lony had two causes of action based on Delaware statutes designed to ensure
that its corporate citizens do not conduct business in a deceptive, unfair or
misleading manner. Applt's Br. at 46-47. The statutes are the Delaware
Consumer Fraud Act, Del.Code Ann. tit. VI Secs. 2511-27 (Supp.1988) and the
With regard to the public interest factors as a whole, we find the court clearly
erred in concluding that they "strongly favor dismissal." App. at 930. With
regard to the first factor, the importance of contacts with each forum, the
balance is close and we cannot say that the district court abused its discretion in
concluding that the contacts with West Germany were more important. With
regard to the second factor, public interest in the case, again, the balance is
close and we cannot say the court's decision that West Germany had the greater
interest was an abuse of discretion. On the third factor, however, the
applicability of local law, the court erred in its conclusion as to the choice of
law in intentional misrepresentation and in its failure to discuss the claims
under Delaware statutes. This factor favors Delaware law and therefore weighs
in favor of retaining jurisdiction. When we balance all three factors, we find
that the district court's conclusion that the public interest factors "strongly favor
dismissal" is clearly in error and an abuse of discretion.
IV. CONCLUSIONS
91
For the foregoing reasons, we find that the district court abused its discretion in
failing to consider adequately and to make a determination of the amount of
deference due the plaintiff's choice of forum. In addition, the court clearly erred
in the conclusion it drew from its weighing of the private interest factors, in its
determination of the choice of law that applied to plaintiff's claim of intentional
misrepresentation and in its failure to consider plaintiff's claims under Delaware
statutes.
92
We will vacate the order of dismissal and will remand the matter to the district
court for reconsideration of the forum non conveniens motion in light of this
opinion and for further proceedings consistent with this opinion.
We have considered and will deny appellant's motion for leave to submit a
letter of the ambassador of the Federal Republic of Germany to the United
States
In Lacey, the plaintiff, who was Australian, had a choice of two forums, both of
which were foreign: Pennsylvania, where the allegedly defective exhaust
system of an airplane was manufactured, and British Columbia, where the air
crash occurred
Du Pont claims that under its agreement of sale with Flexel it can get
documents from the Tecumseh plant, but Lony alleges that the contract only
allows Du Pont reasonable access to records for preparing tax returns and does
not give Du Pont the right to secure the documents Lony requires to use for
trial in West Germany. Applt's Reply Brief at 11. The agreement of sale
between Du Pont and Flexel specifies that Flexel shall allow Du Pont
reasonable access to the books and records that Du Pont transferred to Flexel
"for the purpose of enabling [Du Pont] to prepare and support its various tax
returns and verifying its quality control procedures with respect to filled orders,
..." App. at 601. Since Lony alleges that the DEG in the cellophane resulted not
from any lapse in quality control but, rather, from the use of PEG in Du Pont's
process of manufacturing this type of cellophane, the document seems to
support Lony's position
For a discussion of the relationship between the Hague Convention and the
Federal Rules of Civil Procedure, see Weis, The Federal Rules and the Hague
Conventions: Concerns of Conformity and Comity, 50 U.Pitt L.Rev. 903
(1989)
10
Id
11
The court also pointed out that the case had a nexus with Kansas because the
cellophane was manufactured there, and with Switzerland because Transparent,
a Swiss company, had allegedly made misrepresentations to Lony. App. at 925