State Doctrines of Forum Non Conveniens: Beyond Gulf Oil
April 26, 2022
State courts have their own doctrines for addressing transnational litigation. As Bill Dodge has documented, for example, states have taken different approaches to determining whether state laws have extraterritorial effect. Likewise, state courts have their own doctrines of forum non conveniens (FNC). While a majority of states today apply a version of FNC that is indistinguishable from the federal doctrine, significant variation remains—as Bill Dodge, Chris Whytock, and I document in a forthcoming article, The Many State Doctrines of Forum Non Conveniens.
Before summarizing key points of divergence, a quick refresher on the federal doctrine of FNC (as set out in Gulf Oil Corp. v. Gilbert and Piper Aircraft v. Reyno): First, the defendant must identify an adequate and available alternative forum. Second, the plaintiff’s choice of forum is entitled to significant deference—unless the plaintiff is not a U.S. resident, in which case its choice of forum is given less deference. Third, the court must weigh private and public interests in determining whether the identified alternative would be a more appropriate forum in which to resolve the dispute. The private interests focus on the parties’ access to evidence and witnesses, as well as “all other practical problems that make trial of a case easy, expeditious and inexpensive.” The public interests include local interest (or lack thereof) in the case, the administrative burden of hearing the case, and choice-of-law considerations. We categorize 33 states and the District of Columbia as currently following this general framework.
But we found that 17 states—fully one third—depart from this framework in one or more ways:
Carve-Outs for Local Plaintiffs and Local Causes of Action
Most notably, six states prohibit FNC dismissals for certain categories of cases: Colorado, South Carolina, and Texas prohibit dismissal of cases brought by in-state plaintiffs; Alabama prohibits dismissal of in-state causes of action; and Louisiana and Virginia prohibit both. Also notably, with the exception of South Carolina, all of these carve-outs were adopted not by judges, but by legislatures trying to nudge recalcitrant judiciaries towards a greater acceptance of FNC. That is, when state judiciaries were unwilling to embrace FNC—or an FNC doctrine as expansive as the federal model—state legislatures stepped in, but they were unwilling or unable to go as far as the federal courts in permitting discretionary dismissals.
No Requirement of an Available Alternative Forum
New York and Delaware courts have disclaimed the requirement that there be an alternative forum available to hear the dispute. This is a problematic development because removing this requirement can lead to real denials of justice. But given the pressures and historical trends we document in our article, we would not be surprised to see more states follow their lead. In particular, FNC statutes in four states—Colorado, Oklahoma, Texas, and West Virginia—list the existence of an alternative forum as a factor to be considered rather than as a threshold requirement. West Virginia courts have nonetheless interpreted the West Virginia statute as incorporating the common law requirement of an alternative forum; we would encourage courts in Colorado, Oklahoma, and Texas to do the same.
Primary Emphasis on Private Interest Factors
A few states have eschewed the public interest factors from Gulf Oil, focusing instead on the litigation convenience of both parties. This approach is in keeping with the original framing of the FNC inquiry: is the burden on the defendant to litigate in this forum out of all proportion to the benefits plaintiff would obtain?
Some states instead swap Gulf Oil’s public interest factors for an emphasis on nexus. That is, these states ask whether they have a connection with the dispute in terms of the parties’ domicile, the location of the cause of action, or the applicability of local law. (I have recently written separately about the need to revise the public interest factors, suggesting similar reforms for the federal courts).
Rejecting Piper’s Decreased Deference for Foreign Plaintiffs
Academics have long criticized Piper’s suggestion that foreign plaintiffs should receive less deference for their choice of forum. Not all states have adopted Piper’s distinction, and Washington and Oregon have outright rejected it. As the Washington Supreme Court wrote in Myers v. Boeing Co., Piper’s “reference to the attractiveness of United States courts to foreigners, combined with a holding that . . . gives less deference to foreign plaintiffs based on their status as foreigners, raises concerns about xenophobia.” The Washington court assailed the logic of Piper’s reasoning (“Why is it less reasonable to assume that a plaintiff from British Columbia, who brings suit in Washington, has chosen a less convenient forum than a plaintiff from Florida bringing the same suit?”) and found that the distinction was simply not necessary (given that the private interest factors already account for party convenience). Or as the Oregon Supreme Court put it in Espinoza v. Evergreen Helicopters, “we defer to the plaintiff’s choice not because it is assumed to be convenient, but because it is the plaintiff’s right to choose from those forums that are available to it.”
Finally, some states have developed entirely different frameworks for analyzing FNC. In a carefully researched statute adopted in 1960, Wisconsin enumerated its own factors and limited courts to staying (rather than dismissing) cases for FNC. Colorado’s statute, adopted in 2004, lists a series of factors and instructs courts that they must dismiss cases in which all the factors are met; as long as the plaintiff is not a Colorado resident, the court may dismiss as long as one or more (but fewer than all) of the factors are satisfied. Delaware has treated FNC as intertwined with parallel litigation: If the Delaware suit is the first-filed case, the defendant must show “overwhelming hardship” to get the case dismissed for FNC. But if litigation is already underway in another sovereign’s courts, then there is a presumption in favor of deferring to that pending parallel litigation.
Meanwhile, Georgia’s doctrine is a mess of competing statutes and judicial interpretations; Puerto Rico has firmly rejected Gulf Oil and all but the narrowest of discretion to dismiss cases; and Idaho has yet to adopt any doctrine of FNC.
Lessons from the Variation
Because federal courts apply the federal doctrine of forum non conveniens even in diversity suits, these differences from the federal doctrine can encourage forum shopping by both plaintiffs and defendants. For example, defendants in Texas have removed to federal court to avoid the Texas statute that limits forum non conveniens dismissals in personal injury cases brought under Texas law. Plaintiffs, meanwhile, may choose to sue Delaware corporations in Delaware state courts given Delaware’s “overwhelming hardship” standard (and the inability of in-state defendants to remove to federal court if federal jurisdiction would be based solely on diversity of jurisdiction). Indeed, Delaware’s recent rejection of the available alternative forum requirement could be understood as an effort to counteract such forum-shopping, particularly after the U.S. Supreme Court effectively directed more litigation against Delaware corporations to the state of Delaware in cases like Daimler v. Bauman and Bristol-Myers Squibb Co. v. Superior Court.
Such forum shopping has pressured states to converge on the federal doctrine of FNC, as we document in our article. Yet some states have nonetheless forged their own paths. It took a long time for many states to adopt FNC in the first place, with a few states only doing so after legislatures intervened to overcome judicial hesitancy. Even today, a third of the states have not fully embraced the federal model. At least four lessons can be drawn from this doctrinal variation:
First, scholars and professors should not assume that Gulf Oil and Piper represent “the” doctrine of FNC.
Second, federal judges should not assume that state doctrines of FNC track the federal version. That means the Erie question (i.e., should federal courts apply state or federal FNC doctrine to state-created causes of action?) cannot be avoided by simply assuming that it makes no difference. That said, the Erie question has arguably been settled by decades of federal judicial opinions that have applied federal FNC doctrine to causes of action created by states that did not, at the time, permit FNC dismissals or that significantly limited its application.
Third, state judges, in turn, should be wary of citing federal precedent in FNC decisions (unless their high court has already tethered state doctrine to the federal doctrine, as the Florida Supreme Court explicitly did in 1996).
Finally, and more constructively, both state and federal judges interested in updating and improving FNC doctrine would do well to consider the innovations, both large and small, developed by state courts.