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February 27, 2019 Articles

U.S. Litigation on the Disappearance of Malaysia Airlines Flight 370 Dismissed

The decision to dismiss on forum non conveniens grounds provides a detailed background of what factors courts look at in foreign air crash cases.

By Michael S. Krzak

On March 4, 2014, Malaysia Airlines Flight 370 (MH370), a Boeing 777, disappeared over the southern Indian Ocean. The flight originated in Kuala Lumpur, Malaysia, and was en route to Beijing, China, at the time it disappeared. There were 227 passengers and 12 crew members on the aircraft. See In re Air Crash over Southern Indian Ocean, on March 8, 2014, No. MC-16-1184 (KBJ), 2018 WL 6133070, at *2 (D.D.C. Nov. 21, 2018). The 12 crew members were Malaysian citizens, and the 227 passengers consisted of 14 nationalities, including 152 Chinese citizens, 38 Malaysian citizens, and 3 U.S. citizens. Id. Following the disappearance, an unprecedented international search and rescue, followed by a search and recovery effort, took place. It is now three and a half years since the aircraft disappeared, and while some pieces of the wreckage have washed ashore in the Indian Ocean and on the coast of Africa, most of the plane has not been found, including the cockpit voice recorder and the digital flight data recorder. None of victims have been found. Id. at *4. 

On January 28, 2015, the Malaysian Department of Civil Aviation announced that all of the individuals on MH370 were presumed deceased. Litigation ensued in both Malaysia and the United States. Complaints were filed in California, the District of Columbia, Illinois, New York, South Carolina, and Washington State. Ultimately, the Judicial Panel on Multidistrict Litigation centralized the pretrial proceedings with respect to the cases filed in the United States in Washington, D.C., before U.S. District Judge Ketanji Brown Jackson. Of the 88 decedents represented in the multidistrict litigation (MDL) in the United States, 77 were also represented in the cases pending in Malaysia. Id. at *6.

On November 21, 2018, Judge Brown Jackson issued a lengthy decision dismissing the cases pending before her based on the doctrine of forum non conveniens. In total, 40 complaints were pending in the MDL. All remaining cases were dismissed, the court holding that, “on balance, the claims asserted in the consolidated complaints have a substantial and overriding nexus to Malaysia that outweighs the less substantial connection to the United States.” Id. at *2.

In coming to her conclusion, Judge Brown Jackson applied the forum non conveniens factors established in Piper Aircraft Co. v. Reyno, 454 U.S. 235 (1981). These factors include:

  • whether there is an available and adequate alternative forum; and
  • whether the balance of the various public and private interest factors indicates that maintaining the case in the current forum is comparatively inconvenient.

Id. at 254.

Judge Brown Jackson looked to the forum non conveniens factors as they relate to both the claims that the various plaintiffs made against Malaysia Airlines based on the Montreal Convention and the claims that the various plaintiffs made against Boeing under negligence and product liability theories, seeking damages for wrongful death.

Claims Against Boeing

The plaintiffs in the various cases brought claims against Boeing, the manufacturer of the aircraft. The court noted that 35 of the cases currently pending in the MDL asserted wrongful death and products liability claims against Boeing. In re Air Crash over Southern Indian Ocean, on March 8, 2014, 2018 WL 6133070, at *21. Despite the fact that a number of the plaintiffs were U.S. citizens and that three of the decedents in the litigation were U.S. citizens, the court found Malaysia to be an adequate forum to litigate the claims brought against Boeing. In coming to this conclusion, the court considered the balance of the public and private interests and concluded that they weighed in favor of dismissal on forum non conveniens grounds.

In weighing the public interest factors, the court recognized that Boeing is an American corporation. However, the court noted that “the key question as far as the forum non conveniens balancing is concerned is whether the significant public interest of the country that manufactured the aircraft outweighs the public interest of the country that maintained and operated the ill-fated plane.” Id. at *22. In drawing this conclusion, the court followed prior precedent in similar cases that considered the public interest of the carrier’s country to be weighed most heavily in the context of consideration of forum non conveniens. Id. (citing Schijndel v. Boeing Co., 263 F. App’x 555, 557 (9th Cir. 2008)). However, the court seemed to leave the door open to a differently pleaded case arising under like circumstances surviving a forum non conveniens challenge:

One can certainly conceive of a case in which the interest of the country where the aircraft is manufactured might be considered superior to that of the country where the aircraft was maintained and operated—say in a case involving specific allegations of fact pertaining to a single identified design or manufacturing defect that allegedly caused the crash.

Id. at * 22.

Because there was no wreckage and no identifiable defect in the absence of the cockpit voice recorder and the digital flight data recorders, which have not been recovered, the plaintiffs in the MH370 crash case were proceeding on a res ipsa loquitur theory as opposed to alleging an identifiable, specific defect. In light of this circumstance, it appears that the court was not inclined to find that the interests of the United States in resolving the claims against Boeing outweighed Malaysia’s interests.

The court also considered Boeing’s inability to implead certain corporate entities that the court noted were controlled by the Malaysian government. Because the Foreign Sovereign Immunities Act could impede Boeing from adding these entities in the United States, the court gave greater weight to Malaysia, where Boeing could do that.

Last, the court considered the private interest factors. The court gave great weight to Boeing’s representations that it would make all evidence in its possession available in Malaysia. Significantly, in looking at the fact that the plaintiffs’ claims against Boeing were based on res ipsa loquitur, the court noted that

[t]o succeed on the [res ipsa loquitur] theory, Plaintiffs will have to rule out other likely causes of the plane’s disappearance—e.g., weather, terrorism, crew sabotage, and the like—and a substantial portion of the evidence regarding possible alternative causes is located in Malaysia. . . . Similar evidence pertaining to the cause of the disaster is likely located in Australia, the United Kingdom, and other non-U.S. Countries. [citation omitted] Thus, when the nature of these claims and the scope of the related litigation is carefully considered, the location-of-the-evidence aspect of the private interest factor tips in favor of dismissing the instant claims.

Id. at *24.

Claims Against Malaysian Airlines
under the Montreal Convention

In addition to bringing product liability claims, the various plaintiffs asserted claims pursuant to the Montreal Convention. In ruling that the cases should be dismissed under the doctrine of forum non conveniens, the court first looked to the availability and adequacy of Malaysia as an alternative forum for purposes of the claims brought under the Montreal Convention. Citing numerous other decisions, the court found that Malaysia was an adequate forum. Id. at *13. The court was unimpressed with the argument made by one of the groups of plaintiffs that they would not be able to secure relief because of a restructuring, post-crash, of certain Malaysian Airlines entities. The court reasoned that there was insurance available and that if the entities were truly not subject to a judgment because of a change in the law in Malaysia, the relief would be just as difficult to prove in the United States.

As to the public interest factors, the court found that “Malaysia has an overwhelming interest in the resolution of any Montreal Convention claims that have been asserted against its own national carrier due to one of the largest aviation disasters in Malaysian history.” Id. at *14. The court went on to note that

Malaysia’s myriad connections to that flight are undeniably substantial. It was Malaysia’s national air carrier—MAS—that operated Flight MH370, and the ill-fated aircraft departed from an airport in Kuala Lumpur shortly before its disappearance. . . . Malaysian air traffic controllers were the last persons to have direct contact with the pilot and crew, who were themselves Malaysian citizens. And after the aircraft vanished, Malaysian officials were responsible for leading the civil safety investigation pursuant to an international treaty. Malaysian authorities further conducted a separate criminal investigation concerning individuals who were known to have contact with the flight and/or aircraft, and the Malaysian court system has now undertaken to entertain a host of lawsuits that were filed in that jurisdiction by representatives and heirs of the decedents—in fact 77 of the 88 Flight MH370 passengers whose interests are represented in the cases that are now before this Court are also the subject of pending Malaysian lawsuits that arise out of these same unfortunate circumstances. What is more, the Flight MH 370 disaster was of such significance to the government of Malaysia that it enacted legislation reorganizing MAS and creating MAB in the wake of these events.

Id. at *14.

According to the court, all of the above factors “underscore the very strong Malaysian interest in the Montreal Convention claims arising from this tragedy.” Id. Coupled with the fact that the plaintiffs pleaded unspecific res ipsa loquitur counts, the court seems to have been persuaded by the fact that 77 of the 88 plaintiffs before the court in the MDL had also filed cases in Malaysia.

The court also looked to the private interest factors and concluded that those factors also favored transfer to Malaysia. Despite the plaintiffs’ agreement to make all of the evidence relating to damages available in the United States, the court held that it did not rise to the level of making the United States a convenient forum. Because the plaintiffs were seeking in excess of the 113,000 special drawing rights (an international “currency” established by the International Monetary Fund, the value of which is calculated in reference to a selection of the major currencies in the world’s trading and financial systems) that the Montreal Convention automatically provides for, the court placed great weight on Article 21 of the Montreal Convention:

However, with respect to the Montreal Convention claims at issue in this MDL, the private interest-balancing inquiry does not stop there because the Plaintiffs have made clear that they are seeking damages in excess of the first 113,000 special drawing rights [citations omitted]. The Montreal Convention permits plaintiffs to recover such excess damages (assuming their evidence establishes those loss values), but the carrier is authorized to defend against any such judgment by demonstrating that “the accident is entirely attributable to events wholly outside the carrier’s control.” [citation omitted] And it is that inquiry that will necessarily expand the scope of the litigation related to Plaintiffs’ Montreal Convention claims such that litigating these claims in the United States could become unduly burdensome.

Id. at *16.

The court discussed the alternative parties and the potential evidence that would make it unduly burdensome to litigate the case in the United States. In the court’s assessment,

[h]ere liability-related evidence might include satellite-communication evidence located in the United Kingdom, debris evidence in France and Australia, and the discovery quest would also inevitably include seeking the potentially vast amounts of materials and information that are located in Malaysia, including personnel files, airline maintenance records, manuals, air traffic control recordings, video recordings, cargo records and bank records.

Id.

Ultimately, in weighing the balance of the private interest factors, the court held that the location of the evidence would be relevant because the plaintiffs were seeking damages in excess of the 113,000 special drawing rights and the defendants would have a right to conduct discovery and assert their defenses.

Conclusion

Overall, the court’s decision provides a detailed background of what factors the court looks to in making the forum non conveniens determination, including the weight that is assigned to the public and private interest factors depending on the theories and allegations made by plaintiffs in foreign air crash cases. While the court ultimately dismissed the plaintiffs’ claims, the court recognized that if the facts and circumstances had provided for a concrete defect theory against the U.S. manufacturer, a different forum non conveniens outcome allowing U.S. jurisdiction may have occurred.
 

Michael S. Krzak is with the Krzak Rundio Law Group, LLC, in Chicago, Illinois.


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