The U.S. District Court for the Northern District of Illinois recently issued three separate decisions dismissing litigation arising from the crash of AirAsia Flight QZ8501 on December 28, 2014. The case involved claims brought by the representatives of 36 of the 156 passengers who were killed in the crash against seven defendants, including the alleged owner of the aircraft and various component manufacturers. The aircraft manufacturer, Airbus, S.A.S., was originally named as a defendant but was dismissed for lack of personal jurisdiction in December 2015. AirAsia was not a party to the litigation.
Before the court were three motions: 1) a joint motion by Doric Corporation, Honeywell International, Inc., and Goodrich Corporation (the “FNC defendants”) to dismiss on the basis of forum non conveniens; 2) a motion to dismiss for lack of personal jurisdiction by Thales Avionics, S.A.S., a French company that allegedly manufactured Flight Augmentation Computers for the accident aircraft; and 3) a motion for summary judgment by Airbus Americas, Inc.
The FNC defendants argued that Indonesia, rather than the United States, is the appropriate forum for the litigation because the crash occurred in or near Indonesian waters, the overwhelming majority of the decedent passengers and crew were Indonesian citizens, the flight was operated by an Indonesian airline, and the accident was investigated by the Indonesian Transportation Safety Committee (the “KNKT”). In support of their motion, they provided the KNKT’s official report of the accident investigation, which suggested that pilot error and maintenance issues may have contributed to the crash, as well as testimony from an expert in Indonesian law regarding the accessibility of the Indonesian courts. Plaintiffs opposed the forum non conveniens motion and filed a separate motion to bar the testimony of the FNC defendants’ Indonesian law expert as unreliable.
The court denied plaintiffs’ motion, holding that standards of admissibility such as Federal Rule of Evidence 702 do not apply when assessing expert testimony on a question of foreign law.1 Looking to Federal Rule of Civil Procedure 44.1, which permits courts to use “any relevant material or source . . . whether or not submitted by a party or admissible” to determine foreign law, the court held that it was free to use the expert’s testimony to assist it in deciding the forum non conveniens motion regardless of its admissibility or reliability under the Federal Rules of Evidence.
Turning to the forum non conveniens motion, the court first held that because none of the plaintiffs were U.S. citizens, their choice of forum was not entitled to deference. It then found Indonesia to be an available alternative forum for the litigation because the moving defendants had agreed to submit to personal jurisdiction there, and an Indonesian court could not decline to exercise jurisdiction sua sponte. Despite the fact that Indonesia allows only limited pretrial discovery, the court also found it to be an adequate forum for plaintiffs to pursue their claims. The court then weighed the public and private interest factors implicated by plaintiffs’ choice of forum in the United States, and found that these generally weighed in favor of dismissal. Specifically, the court found that the parties would have easier access to critical evidence, including aircraft wreckage and testimony from AirAsia employees, in Indonesia.2 It also found that Indonesia’s public interest in the litigation overwhelmingly outweighed that of the United States given that the accident occurred in Indonesia, involved an Indonesian airline, and implicated Indonesian flight safety regulations and air traffic control. In contrast to Indonesia’s strong interest in adjudicating claims arising from the accident, the interests of the State of Illinois and the United States were “nearly nonexistent.”
Having determined that Indonesia had a stronger public interest in the litigation and would be a more convenient place to conduct it, the court granted the forum non conveniens motion and dismissed the case as against the three FNC defendants.
In its separate motion, Thales Avionics argued that the court could not exercise specific jurisdiction over it because the accident at issue had no connection to the United States, nor could the court exercise general jurisdiction because the French company does not have sufficient business contacts here. Opposing the motion, plaintiffs argued that under the Multiparty Multiforum Trial Jurisdiction Act (the “MMTJA”), which provided the court’s subject matter jurisdiction, service of process alone was enough to establish personal jurisdiction. The court rejected plaintiffs’ argument, holding that the MMTJA does not abrogate the constitutional due process principle, recently articulated by the U.S. Supreme Court in Daimler AG v. Bauman,3 that to be subject to general jurisdiction a foreign corporation must have business contacts in a forum so “continuous and systematic” that it is “essentially at home” in the forum. Although Thales Avionics markets its products in the United States and derives significant revenue from American customers, such revenue constitutes less than 10% of its annual global sales, and it has no authorized agent or representative in the United States and performs no direct sales here. The court held that these contacts fall below the “essentially at home” standard required to exercise general jurisdiction, and granted the motion to dismiss.4
In support of its motion for summary judgment, Airbus Americas, Inc. argued that while its parent company Airbus S.A.S. (which had already been dismissed from the litigation) designed and built the accident aircraft, it had no involvement with the aircraft’s design, manufacture, marketing or sale, and could not be held liable. Assessing the evidence in the record, the court agreed. As a predicate to its decision, the court applied the “location” and “nexus” test set forth in Jerome Grubart, Inc. v. Great Lakes Dredge & Dock Co.5 to determine that the case fell within admiralty jurisdiction and was governed by general maritime law. Under maritime law, a defendant “cannot be liable for a manufacturing defect in a product that it did not make or supply,” and Airbus Americas, Inc. could not be liable.6
With these three decisions, a major portion of the U.S. litigation arising from one of the deadliest air crashes in Indonesian history has been dismissed.
1 See Siswanto v. Airbus Americas, Inc., No. 15-CV-5486, 2016 WL 7178460 (N.D. Ill. Dec. 9, 2016) (memorandum opinion and order granting the FNC defendants’ motion to dismiss).
2 Important to this aspect of the decision was a declaration by AirAsia that it would refuse to consent to jurisdiction in the United States or cooperate with any United States-based litigation.
3 134 S. Ct. 746 (2014).
4 Siswanto v. Airbus Americas, Inc., No. 15-CV-5486, 2016 WL 7178459 (N.D. Ill. Dec. 9, 2016) (memorandum opinion and order granting Thales Avionics’ motion to dismiss).
5 513 U.S. 527 (1995).
6 Siswanto v. Airbus Americas, Inc., No. 15-CV-5486, 2016 WL 7178458, at *5 (N.D. Ill. Dec. 9, 2016) (memorandum opinion and order granting summary judgment as against Airbus Americas, Inc.).