Gaynell Reyno, As Personal Representative of the Estate Ofwilliam Fehilly, Liam Stewart Fehilly, Williamjames Mcdougall Storm, David Vincentmoran, and Peter Cunninghamscott, Appellant, v. Piper Aircraft Company, a Corporation; Avco Lycoming Enginegroup, a Division of Avco Corporation; Hartzellpropeller, Inc., a Corporation, 630 F.2d 149 (3d Cir. 1980)

This is an appeal from a dismissal of a wrongful death action on grounds of forum non conveniens. The issues include the factors to be considered in such a dismissal, the burden of persuasion on such motion, the scope of the trial judge's discretion, and the application of choice of law rules of California and Pennsylvania.

The event giving rise to this dispute was the crash of a Piper aircraft in Scotland in July 1976. The plane was owned by a Scottish air taxi service, the passengers and crew of which were Scottish. All persons aboard were killed and no witnesses survived the crash. There are indications, however, that something went wrong with the left engine for which compensatory action by the pilot was impossible, was unnecessarily difficult, or was ineptly handled by the pilot.¹ 

Gaynell Reyno, a California resident and personal representative of the estates of various Scottish decedents, sued on their behalf in a California state court. Named as defendants were Piper Aircraft Corp., a Pennsylvania corporation that manufactured the aircraft; Avco Lycoming Engine Group, which produced the engine; and Hartzell Propeller, Inc., an Ohio corporation that built the propeller. The wrongful death action is based on theories of strict liability and negligence.² 

On motions by Piper and Avco based on diversity of citizenship, the case was removed from the California state court to the federal district court in California. After the removal, Hartzell moved to dismiss for lack of personal jurisdiction or, in the alternative, to transfer the case to the Middle District of Pennsylvania under 28 U.S.C. § 1404(a).³  Piper moved to dismiss for failure to state a cause of action or, alternatively, to transfer the case to the Middle District of Pennsylvania and to strike the claim for punitive damages. The action was dismissed as to Avco with the agreement of plaintiff.

The district court in California entered an order (1) granting the motion to quash service of process as to Hartzell on the ground that personal jurisdiction over Hartzell was neither authorized by California law nor in accord with due process; and (2) transferring the case to the Middle District of Pennsylvania pursuant to § 1404(a).

Subsequent to the transfer, Hartzell was validly served with process in Pennsylvania and then moved to dismiss the case on the common law ground of forum non conveniens. Piper filed a similar motion captioned as a request for judgment on the pleadings or summary judgment. Both motions were accompanied by affidavits. On the basis of the affidavits, the trial judge granted the motions to dismiss because of forum non conveniens on condition that defendants submit to personal jurisdiction in Scotland and waive any statute of limitations there. Reyno filed a timely appeal.

In this Court, Reyno raises two major contentions: (1) The judge erred in not holding defendants equitably estopped to assert that Scotland was a more appropriate forum, inasmuch as Piper had maintained in California that Pennsylvania was the most appropriate forum. (2) The trial judge abused his discretion in dismissing the action. Subsidiary, but arguably crucial, to this second point is the claim that the district judge's order was based on a legal error as to whether Scottish or Pennsylvania law applied to most or all of the case.

I. THE INTERACTION OF A TRANSFER UNDER § 1404(a), A SUBSEQUENT FORUM NON CONVENIENS MOTION, AND THE CONCEPT OF PRECLUSION

Reyno argues that the district court erred in not considering whether the defendants were equitably estopped from moving to dismiss. Essentially, she contends that, by following a successful motion to transfer the case from California to Pennsylvania with a motion to dismiss so that the case would have to be filed in Scotland, the defendants are trifling with the court and wasting judicial and litigant time and resources.

The district court's opinion did, however, consider plaintiff's argument and rejected it, albeit in a somewhat summary fashion:

No cases are cited in support of that proposition and we believe that is a sufficient indicator of the merit of that argument. . . . The papers filed concerning the motion to transfer are, of course, irrelevant to the question we have decided. They were filed early on in this proceeding before many of the important facts of this case were uncovered. Also, Defendants should not be punished for their failure to file a motion to dismiss for forum non conveniens first, instead of the motion to transfer. If they would have filed such a motion we feel sure that the California district court would have likewise dismissed this action.⁴ 

The Court of Appeals for the Fifth Circuit has reversed the dismissal of an admiralty claim on forum non conveniens grounds for the reasons now pressed by Reyno. It declared that the defendant should not be permitted, after securing a statutory transfer from Louisiana to Georgia, to contend that Georgia was not really an appropriate forum; the defendant "may not 'so trifle with the judicial process.' "⁵ 

Defendants here urge, and the district court seemed to accept, that they did not take inconsistent positions before the district court in California and that in Pennsylvania. The motion in California, defendants claim, simply represented that Pennsylvania was a better forum than California, whereas the present motion contends that Scotland is better yet. Furthermore, they aver, any inconsistencies are a result of fuller knowledge of the relevant facts.

Examination of the motions made by defendants in California reveals that their prior allegations are indeed at variance with their present contentions. A statutory transfer, as well as a common law dismissal, must be shown to be not only more convenient, but also in the interest of justice. In meeting that burden, Hartzell asserted in California that "the plaintiffs would easily have their interests herein protected and adjudicated by application to the courts located in the State of Pennsylvania, and in fact such would be overwhelmingly fair to all the parties herein."⁶  Similarly, Piper argued that "(t)he propriety of transferring the within action to Pennsylvania for the convenience of the witnesses appears to overwhelm other factors, in view of the apparent theories of liability as against the defendants."⁷ 

Both defendants asserted that, because the claim was based on strict liability, virtually all the evidence and material witnesses as to production and design would be in Pennsylvania or Ohio.⁸  Furthermore, they argue that new facts bearing on forum non conveniens were discovered after motions were filed in California.

At the time of the transfer motion critical facts such as where various witnesses are, where the crash occurred, where the wreckage was located, and who owned the plane, were known. All that seems new was that a British administrative agency would investigate and report on the accident and that the decedents' estates would institute a separate action against the air taxi service in Scotland. Although these last facts are indeed relevant to a forum non conveniens motion, they are hardly surprising or significant.

Nevertheless, two factors weigh against an absolute preclusion to raise a forum non conveniens motion in this case: (1) The thrust of Hartzell's motion in the California court, and the contention accepted by that tribunal, was lack of personal jurisdiction. Arguably, then, it is not fair to make Hartzell responsible for proceedings there, even if it would be fair and proper as against Piper. (2) Forum non conveniens entails important considerations of public interest, in addition to those of the private litigants themselves. If defendants are correct in their proposition that trial in Pennsylvania would be unduly burdensome to the court and the juror community, it might be self-defeating to raise an absolute barrier to pleading forum non conveniens. Hence, although a party who moves for transfer under § 1404(a) will not be automatically estopped to assert forum non conveniens after a transfer is accomplished, the fact that a party previously succeeded in a statutory transfer ought to be weighed against dismissing for forum non conveniens and as adding to a defendant's already substantial burden on the later motion.

The doctrine that an otherwise validly brought claim may be dismissed because the forum chosen was inconvenient for trial originated in the common law of Scotland,⁹  became part of the common law of many states,¹⁰  and has a long history of use in federal admiralty actions.¹¹  It was introduced into federal diversity jurisdiction by Gulf Oil Corp. v. Gilbert¹²  and Koster v. (American) Lumbermens Mutual Casualty Co.,¹³  decided in 1947.

Simple in enunciation but complex in application, the principle of the doctrine is that a court may resist imposition upon its jurisdiction even when neither jurisdiction nor venue is defective.¹⁴  As a result of the passage of 28 U.S.C. § 1404(a), soon after the two seminal Supreme Court cases,¹⁵  forum non conveniens as a common law doctrine has been dormant for purposes of interstate dismissals within the federal system. That statute is similar to the common law doctrine, but authorizes transfers within the federal court system with a lesser burden both substantively and procedurally than a motion to dismiss.¹⁶ 

The question whether federal or state law of forum non conveniens applies in a diversity case was left open by the Supreme Court and has not definitively been decided by any court of appeals.¹⁷  In this case, as in many brought before the federal courts, federal law has been argued at all stages in the litigation.¹⁸  Upon specific request for supplementary briefing in this Court, all three parties agree that if a choice is necessary, federal law should be followed, and cite numerous district court opinions and commentaries in support of that position.¹⁹  They assert, nevertheless, that it is probably not necessary to decide between federal and state law because the cases dealing with forum non conveniens in both California and Pennsylvania have mirrored federal law in all essential respects. We agree.²⁰ A. Comparative Burdens, Trial Court Discretion, and Standard of Review

A plaintiff is generally conceded the choice of forum so long as the requirements of personal and subject matter jurisdiction, as well as venue, are satisfied. He should not be deprived of the advantages presumed to come from that choice unless the defendant clearly adduces facts that "either (1) establish such oppressiveness and vexation to a defendant as to be out of all proportion to plaintiff's convenience . . . or (2) make trial in the chosen forum inappropriate because of considerations affecting the court's own administrative and legal problems."²¹  A court must balance these private and public interest factors, "(b)ut unless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed."²² 

The district judge believed that the plaintiff's choice of forum is of diminished significance, and the defendants' burden of showing inconvenience correspondingly less, when the plaintiff more precisely, the real party in interest is foreign or when the forum chosen is not the plaintiff's home ground.²³  But neither of these burden-shifting principles may be found in opinions of the Supreme Court or this Court.

In support of the proposition that less solicitude is due a foreign plaintiff's choice of forum, the district court relied on a decision of the District Court for the Southern District of New York which stated that a foreign plaintiff's "choice of forum should be given less weight than the choice of an American plaintiff."²⁴  The court of appeals affirmed the judgment in that case, but disapproved of the district court's characterization of the forum non conveniens doctrine applicable to noncitizens.²⁵  Indeed, as the Court of Appeals for the Second Circuit has recently held, the citizenship of the plaintiff does not affect the defendant's burden under Gilbert and Koster. American citizenship of the plaintiff does not increase the defendant's burden, just as foreign citizenship may not lessen it.²⁶ 

The holding by the trial judge that a plaintiff's choice is entitled to less weight when it is not the plaintiff's state of residency is somewhat difficult to follow when, as here, that party had already been forced to cede the "home court advantage" as a result of the defendants' previous motion to transfer the case from California to Pennsylvania.²⁷  It would be the rare situation in which a defendant could complain of being vexed or harassed by defending a lawsuit on its home ground.

Of course, the Supreme Court has stated that "(t)he doctrine (of forum non conveniens) leaves much to the discretion of the court to which plaintiff resorts," but this broad proposition was followed by the explanatory observation that "experience has not shown a judicial tendency to renounce one's own jurisdiction so strong as to result in many abuses."²⁸  The standard of review is one of abuse of discretion,²⁹  but if the trial court has not held the defendants to their proper burden or has clearly erred in weighing the factors to be considered, the equivalent of an abuse of discretion has been demonstrated. Discretion must be exercised within the applicable standards.³⁰  The district court's wide discretion may not serve the defendants as a burden-shifting device on appeal from an order in their favor.

The Gilbert Court divided the elements to be considered into those affecting the private interests of the litigants and those in which the public has an interest. The former include

the 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; possibility of view of premises, if view would be appropriate to the action; and all other practical problems that make trial of a case easy, expeditious and inexpensive. There may also be questions as to the enforcibility of a judgment if one is obtained.³¹ 

Also relevant is the inability to implead other parties directly involved in the controversy.³²  These various ingredients are weighed to determine the "relative advantages and obstacles to fair trial."³³ 

Among the public interest factors are a) problems of creating court congestion and imposing jury duty in litigation centers that are removed from the origin of the controversy, and b) benefits of holding the trial in a place accessible to the witnesses to the accident and of having the trial in a forum where the court is familiar with the law governing the case rather than having a court elsewhere untangle foreign law.³⁴ 

We shall examine each of these elements to determine whether the defendants met their burden.

If a dismissal is to be premised on the convenience of witnesses, more than a mere allegation to that effect is required. The rule for a statutory transfer, which is to be more readily granted, is no less applicable to a dismissal for forum non conveniens:

The party seeking the transfer must clearly specify the key witnesses to be called and must make a general statement of what their testimony will cover. The emphasis must be on this showing rather than on numbers. One key witness may outweigh a great number of less important witnesses. If a party has merely made a general allegation that witnesses will be necessary, without identifying them and indicating what their testimony will be the application for transfer will be denied.³⁵ 

The district court opinion does not discuss the need for such a showing, but rather merely refers generally to witnesses on the damages issue and witnesses on the potential supervening negligence of the Scottish air taxi service, all of whom are in Scotland.³⁶  Nor do the defendants direct us to any affidavits setting forth the requisite specific information, and our search of the record detects none. The requirement of specificity would seem more acute in this case given that in motions before the district court in California the defendants claimed somewhat inconsistently with the position now taken though perhaps more accurately, that all witnesses relevant to strict liability or negligence in manufacturing are in Pennsylvania or Ohio.³⁷ 

At the least, then, the district court did not have sufficient information to weigh the convenience of witnesses, and its conclusion that this factor favored defendants appears to be without the requisite foundation.

One further error in discerning the balance of inconvenience to witnesses deserves mention. The trial judge stated that the convenience of expert witnesses, like that of counsel, "is of small importance."³⁸  No explanation was given for this assertion,³⁹  but the theory seems to be either that expert witnesses are fungible or that their testimony can be introduced effectively by deposition. We agree with authors of a noted treatise that this view is unsound.⁴⁰  In this case, as in many others, the testimony of expert witnesses will be crucial. Finding the most trustworthy and credible experts is not often easy, and the advantages of live testimony are not to be discounted.⁴¹ 

2. Availability of Compulsory Process and Impleader

The defendants' major factual contention when the case comes to trial will be that the fatal crash at issue was caused not by any manufacturing or design defects, but by pilot error or by the negligence of the foreign air taxi service. Inability to implead foreign third-party defendants was argued vigorously here as a problem with a trial in this country, and it has, of course, generally been considered an important consideration favoring a forum non conveniens dismissal.⁴²  Because there is an action pending in Scotland by the decedents' estates against the appropriate Scottish defendants, which lawsuit Piper and Hartzell have consented to join as codefendants, the district court concluded, that it would be unfair and unduly burdensome for defendants to be subjected to both trials. Although the extra burden is readily apparent, the unfairness is not. The defendants state their point as follows:

Defendants' inability to join (the Scottish) parties as defendants in this case would seriously prejudice Defendants, through exposure to unnecessary, duplicitous litigation, and inconsistent verdicts. If Defendants are found liable here, they will be forced to file an indemnity or contribution action in Scotland against these parties. In light of the fact that Pennsylvania and Scottish law differ greatly with respect to products liability, Piper faces the substantial possibility, and great prejudice, of being held liable on a products liability theory in this case but being forced to prove negligence in an indemnity or contribution action in Scotland. Even if the same standard of liability is applied in this action and in an indemnity or contribution action in Scotland, Defendants run the substantial risk that different juries will find different facts and, hence, produce inconsistent results.⁴³ 

If the defendants are found liable on strict liability here but must prove negligence against the air carrier to obtain indemnity, that is not unfair, but simply the result reached under the laws of the jurisdictions in which the two companies reside. The air taxi operates exclusively in Scotland and plans its operations and expenses according to Scottish law. Piper and Hartzell reside in strict liability jurisdictions, conduct most of their business in strict liability states, and plan accordingly.

The defendants' risk of inconsistent verdicts would only exist if neither Pennsylvania nor Scotland followed principles of res judicata. Under those principles, any subsequent verdict for plaintiffs would merge with a previous favorable judgment or be barred by a prior judgment against the plaintiffs.⁴⁴  Res judicata is clearly applicable in American jurisdictions and we may assume, in the absence of any affidavits or citations of Scottish law to the contrary, that it is followed in Scotland as well.⁴⁵ 

We therefore conclude that defendants' inability to implead other potentially liable parties would indeed make litigation here more burdensome, but defendants have not shown that it would also be unfair. It is properly an element in their favor on the motion to dismiss, but it is not as weighty as they contend.

The district court concluded that, to the extent weight was to be assigned this factor, it favored defendants: "Familiarity with the topography around Tulla, Scotland and inspection of the wreckage of the plane would be aided by a trial in the British Isles."⁴⁶ 

It is unclear whether the trial judge in fact ascribed any significant weight to this consideration, and still more uncertain is what benefit a lay jury would obtain from observing the wreckage in deciding whether the plane crashed because the engine or propeller were incorrectly manufactured or the pilot was negligent. Furthermore, the topography of Scotland may, to the extent relevant, be readily proved by testimony.

The parties in arguing this case, and the trial judge in deciding it, have placed the greatest importance on whether, under the applicable choice of law rules, American or Scottish law would apply to major aspects of the claims. The district court concluded that, for the most part, Pennsylvania law should apply to Piper and Scottish law to Harzell.⁴⁷  Because application of different laws to the different defendants might confuse the jury, and because ascertainment of Scottish law would make the trial more difficult, the necessity of applying foreign law to a portion of the case was considered the "uppermost" factor favoring dismissal.⁴⁸ 

As will be discussed below, we conclude that the district court erred in its choice of law determinations. But even if the district court were correct in its conclusion that a mixture of Scottish and American law would be required, dismissal would not have been justified under this Court's settled principles of forum non conveniens.

First, we held in Hoffman v. Goberman that "(i)t is settled that the mere fact that the court is called upon to determine and apply foreign law does not present a legal problem of the sort which would justify the dismissal of a case otherwise properly before the court. The district court was therefore, in error in basing its action, in part at least, on this ground."⁴⁹  Although there may be circumstances in which the application of foreign law would present difficulties sufficient to favor dismissal because of difficulties of translation or because the foreign law itself has principles unknown to our jurisprudence we are not faced with such a case here.⁵⁰  Negligence principles are well-known on this side of the Atlantic and of course there will be no translation problems in dealing with Scottish law.

Second, if trial here would confuse the jury because a different country's law would apply to each defendant, that confusion would either not be eliminated by a trial in Scotland or would be eliminated only by unacceptable unfairness to the plaintiff. If, as is unlikely, a Scottish court as a "transferee" court would apply the same choice of law rulings as would the court here, it would have an equally difficult problem in applying the laws of different countries to different defendants. Dismissal here would not eliminate the difficulty, but only shift it to a foreign forum.

The district court, though, had the affidavit of Scottish counsel that Scotland's choice of law rule for torts was to apply the law of the place of injury to all facets of the case, and therefore Scotland probably would apply its own law to all claims. Even under the district court's choice of law analysis, requiring a mixture of American and Scottish law, it is apparent that the dismissal would work a change in the applicable law so that the plaintiff's strict liability claim would be eliminated from the case. But this Court has held that a dismissal for forum non conveniens, like a statutory transfer, "should not, despite its convenience, result in a change in the applicable law."⁵¹  Only when American law is not applicable, or when the foreign jurisdiction would, as a matter of its own choice of law, give the plaintiff the benefit of the claim to which she is entitled here, would dismissal be justified.

2. Choice of Law Rules Under Klaxon and Barrack

As a federal court deciding a case premised on diversity jurisdiction, we are required by Klaxon⁵²  to apply the conflicts of law rules of the state in which we sit. We are not permitted to fashion our own rules, however clearer or salutory they might seem.⁵³  Complicating matters here is that, for purposes of this litigation and its choice of law problems, we are in effect "sitting" in two different states. Moreover, though not entirely disinterested, each state is in the position of choosing between the laws of two other states.

The action against Piper was transferred under § 1404(a) from California to Pennsylvania. The law of the transferor forum i. e., California's choice of law rules should therefore, under Van Dusen v. Barrack,⁵⁴  be applied as to Piper.

Hartzell's situation is more complex. The California district court ruled that personal jurisdiction over Hartzell was lacking, both under California law and the Due Process Clause. The court did not dismiss the case against Hartzell, but rather quashed service of process and ordered transfer to Pennsylvania along with codefendant Piper. Although this Court has held that transfer under § 1404(a) is proper even though the transferor state lacked personal jurisdiction,⁵⁵  that does not resolve the problem whether the Klaxon and Barrack rules would still require us to apply the choice of laws rule of the transferor state.

To state the problem is, we believe, to explain why California's law may not apply to Hartzell: if California's exercise of jurisdiction over Hartzell would violate due process, so would application of that state's choice of law rules.⁵⁶  Furthermore, Barrack is not so rigid. The Court there stated as a general rule of statutory construction of § 1404(a) that, to be "in the interest of justice," a transfer should not work a change in the applicable law.⁵⁷  We conclude that this case comes within an exception, the possibility of which was noted in Barrack,⁵⁸  to the application of the transferor state's law. As with any other statute, we must construe § 1404(a) to avoid any constitutional problem,⁵⁹  and so hold that when there has been an interstate transfer without personal jurisdiction, the transferor state's choice of law does not apply to that defendant. Because Pennsylvania does have personal jurisdiction, the federal court must look to that state's choice of law rules under Klaxon to determine which law applies to Hartzell.

Our analysis so far does not differ from that of the district court, which held that California's choice of law rules applied to Piper and Pennsylvania's rules applied to Hartzell.⁶⁰  The court went on to hold that under California's governmental interest approach the Scottish law of wrongful death would apply to make Reyno an improper litigant, but Pennsylvania's law of strict liability rather than Scotland's negligence law would govern the theory of the tort.⁶¹  Pennsylvania's significant contacts approach was thought to require that Scottish law apply to all facets of the claim against Hartzell.⁶²  We must examine these rulings to determine whether they are erroneous as a matter of law.

a. California Conflicts Law Applied to Piper

California was a pioneering state in the governmental interest analysis approach to choice of law that was developed by Professor Currie.⁶³  In Reich v. Purcell,⁶⁴  the California Supreme Court abandoned the traditional view that the law of the place of wrong (injury) must be applied in tort actions regardless of the issues, and established in its stead the principle that "(t)he forum must search to find the proper law to apply based upon the interests of the litigants and the involved states."⁶⁵ 

Also integral to the holding in Reich v. Purcell was the introduction into California law of the concept of "false conflicts."⁶⁶  In Reich, the wrongful death action arose from an automobile accident that occurred in Missouri between an Ohio plaintiff and a California defendant. Missouri, the state of injury, limited compensation for wrongful death, but neither California nor Ohio had any limitation. The California Supreme Court held that as to the issue of the extent of damages, as opposed to the standard of conduct on which liability was based, there was no true conflict in governmental interests. Since California had no limitation on damages, it had no interest in protecting its resident defendant from a higher recovery. Moreover, the defendant's California insurance policy would be calibrated to the potential burdens of larger claims. Missouri had an interest in the standard of conduct for behavior within its borders, but its interest in limiting damages was solely to protect in-state defendants. It had no substantial interest in extending that protection to defendants from states with no such limitations, and Ohio, as the state where the decedents' estates were probated, did have a substantial interest in unlimited recovery. Therefore, Ohio's law as to the damages issue was applied.⁶⁷ 

Subsequent cases indicate a further refinement of the governmental interest and false conflict methodology termed a "comparative impairment" approach.⁶⁸  This approach comes into practice only after a " 'preliminary analysis has identified a true conflict of the governmental interests involved.' " Once this preliminary step is satisfied, the court resolves a true conflict by " 'determin(ing) which state's interest would be more impaired if its policy were subordinated to the policy of the other state. . . . (T)rue conflicts should be resolved by applying the law of the state whose interest would be the more impaired if its law were not applied.' "⁶⁹ 

Among the relevant factors to be considered in determining choice of law under California's comparative impairment approach are the following:

(1) The status of the law whether it is to be considered anachronistic or ascendant in the common law jurisdictions. " 'If one of the competing laws is archaic and isolated . . ., it may not unreasonably have to yield to the more prevalent and progressive law, other factors of choice being roughly equal.' "⁷⁰ 

(2) Insurance and other planning for risks. Parties may be expected to plan their activities with insurance in mind, and that planning may affect the comparative fairness of two competing rules of liability.⁷¹ 

As we have mentioned, the district court divided the case against Piper into distinct issues, and ruled that a California court would apply its law as to one and Scottish law as to others. He then employed what conflicts scholars refer to as depecage, defined as "the process of applying the rules of different states to determine different issues in the same case."⁷²  Although the California Supreme Court has not explicitly adopted this method, it is implicit in that court's analysis of cases and it is consistent with modern governmental interest analysis to examine comparative governmental interests as to each issue, to the extent the issues are separable and the balance of comparative interests may vary.⁷³  We shall therefore examine separately the issues identified by the parties and the district court: the standard of liability, damages for wrongful death, and the capacity of the plaintiff to bring a wrongful death suit as a representative.

Any asserted conflict between American strict liability and Scottish negligence law is, we believe, a false one. Two basic policies underlie theories of tort liability: deterrence of harm-causing conduct and compensation of persons injured by that conduct. In private tort law, in which civil rather than criminal liability is imposed, the deterrence function is accomplished by compensation of the plaintiff. The choice between holding a manufacturer liable only for negligence and holding it strictly liable for any dangerous products or design is, practically speaking, a matter both of searching for optimal deterrence of harmful conduct and of allocating the costs of injuries either to producers or consumers. A negligence standard is, broadly speaking, more protective of producers, while strict liability is more solicitous of consumers.

The perceived conflict in this case is between Scotland's interest in encouraging industry by protecting manufacturers and making it relatively more difficult for consumers to recover. Pennsylvania, by contrast, in adopting strict liability, has shifted some of the burdens of injuries from consumers to producers. By adopting this policy of increased deterrence, it seeks to make manufacturers more careful in production and design than they would be if held to a negligence standard.⁷⁴ 

Applying Pennsylvania's strict liability standard to its resident manufacturer would serve that state's interest in the regulation of manufacturing. Scotland's interest in encouraging industry within its borders would not be impaired, however, by applying a stricter standard of care on a foreign corporation which has no industrial operations in Scotland. Furthermore, Scotland would have no interest in denying compensation to its residents for the purpose of benefiting a foreign corporation. Finally, imposition of strict liability on Piper cannot be said to be unfair to it. Inasmuch as Pennsylvania, the state in which Piper makes its product, and the vast majority of American jurisdictions in which most of Piper's aircraft are sold and fly, have strict liability,⁷⁵  that is the legal standard under which it plans its operations.

Pennsylvania's interest in deterring defects in products can be served without impairing any significant interest of Scotland. Application of Scotland's negligence law would only harm resident beneficiaries without any countervailing benefit to its industrial economy. We therefore conclude that, as between Pennsylvania and Scottish law on this issue, a California court would apply Pennsylvania's strict liability analysis. Similar considerations would govern any greater restrictions on recovery for wrongful death that Scotland may have.⁷⁶ 

The district court declined to make any definitive ruling on the issue of plaintiff's capacity to sue because of the paucity of available information for balancing comparative governmental interests. 479 F. Supp. at 735. There was thought to be no need to decide this question, because the court concluded for other reasons that the action should be dismissed and brought anew in Scotland.⁷⁷ 

Because we reverse the dismissal, it will be necessary for the trial judge to decide that issue based upon additional information. If it is held that Reyno does not have representative capacity, it will be necessary to allow a substitution of parties so that the decedents' estates can bring the action directly. Such a substitution would not destroy diversity and should be granted in the interests of justice.⁷⁸ 

Guiding the trial judge's decision should be the requirement of Fed. R. Civ. P. 17(b) that the capacity of an individual to sue in a representative capacity "shall be determined by the law of the state in which the district court is held."⁷⁹  In addition to examining the laws of California and Pennsylvania to determine whether Reyno has representative capacity,⁸⁰  the trial court should consider whether the defendants' challenge to the plaintiff's capacity to sue has come too late in the litigation.⁸¹ 

b. Pennslyvania Conflicts Law Applied to Hartzell

Citing Griffith v. United Airlines,⁸²  the district court applied the "significant contacts" approach to determine that Scotland's standard of liability, rather than that of Ohio or Pennsylvania, applied to Hartzell.⁸³  But a close examination of Griffith and, more importantly, subsequent elaborations by the Pennsylvania Supreme Court reveals that Pennsylvania's approach to choice of law is quite similar, at least for purposes of this litigation, to that of California. Pennsylvania first looks to identify and thus avoid false conflicts, and then, when a true conflict is present, examines and compares the competing governmental interests.

In Griffith, the Pennsylvania Supreme Court overturned the old rule that the law of the state of wrong governs all issues in tort actions,⁸⁴  but it did not specifically set forth the contours of that rule's replacement. In fact, as the court later indicated, once governmental interests were examined Griffith involved a false conflict situation.⁸⁵  The state in which an airplane crashed was held to have no interest in enforcing its limitation of damages for wrongful death when neither party was a resident.⁸⁶ 

The Pennsylvania Supreme Court noted three general approaches competing to replace the old rule: (1) Professor Currie's early emphasis on applying the forum's law when the forum has a legitimate interest in the issue presented;⁸⁷  (2) Professor Ehrenzweig's stress on the interests of the parties, specifically looking to whether the defendant would have planned by insurance for the risks to which he would be exposed by the applicable law;⁸⁸  and (3) the "significant contacts" approach of the Restatement (Second) of Conflicts, under which a court applies the law of the state with the most significant relationship with the occurrence and the parties.⁸⁹  Rather than choose among these alternative approaches, the Pennsylvania Supreme Court adopted what it believed was the essence of all three: "a more flexible rule which permits analysis of the policies and interests underlying the particular issue before the court."⁹⁰ 

Subsequent cases confirm that Pennsylvania courts follow a governmental interest analysis approach, with a state's contacts being considered significant only when the behavior giving rise to the contact furthers or abrogates a state policy. Where the place of accident is fortuitous and the state where the accident occurred has no interest in the regulatory standard at issue, any conflict between that state and a state truly interested because, for example, the parties resided there, Pennsylvania appears to suggest, a false one.⁹¹ 

In McSwain v. McSwain, the court stated its approach as follows:

Whether the policies of one state rather than another should be furthered in the event of conflict can only be determined within the matrix of specific litigation. What should be sought is an analysis of the extent to which one state rather than another has demonstrated, by reason of its policies and their connection and relevance to the matter in dispute, a priority of interest in the application of its rule of law.⁹² 

The latest discussion in Cipolla v. Shaposka⁹³  summarized the approach of the cases discussed above as calling upon the court to determine which state "has the greater interest in the application of its law to the question now before us." Moreover,

In determining which state has the greater interest in the application of its law, one method is to see what contacts each state has with the accident, the contacts being relevant only if they relate to the "policies and interests underlying the particular issue before the court." When doing this it must be remembered that a mere counting of contacts is not what is involved. The weight of a particular state's contacts must be measured on a qualitative rather than quantitative scale.⁹⁴ 

Griffith, McSwain and Cipolla indicate to us that the primary approach of the Pennsylvania Supreme Court in choice of law is governmental interest analysis. Our determination as to whether the Pennsylvania court would apply American strict liability and unlimited recovery for wrongful death, rather than the negligence and damage limitations law of Scotland, therefore follows our prediction of California law. Indeed, the district court ruled that American standards of liability would control under governmental interest analysis applied as to California.⁹⁵  It is apparent, then, that the district court erred in concluding that foreign law would govern a substantial part of the case, and it is likewise apparent that the choice of law factor weighed heavily in favor of dismissal for forum non conveniens.

We have held that under the applicable choice of law rules Pennsylvania and Ohio are the jurisdictions with the greatest policy interest in this dispute. It follows that the other public interest factors that should be considered under the Supreme Court cases of Gilbert and Koster favor trial in this country rather than Scotland.

Because the defendants did not meet the burden required of them for a forum non conveniens dismissal, the judgment of the district court will be reversed and the cause remanded for further proceedings consistent with this opinion.