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Court Affirms Forum-Related Decision But Says Case Should be Stayed, Not Dismissed

November 15, 2010 – Media Coverage
HarrisMartin

LOS ANGELES -- A California appellate court has upheld a trial court's dismissal of an asbestos case on forum grounds, but has directed the court to enter a stay in the proceedings as opposed to an outright dismissal. Reaser, et al. v. A.W. Chesterton Co., et al., No. B219026 (Calif. 2nd Dist. Ct. App., Div. 7).

In the Nov. 8 opinion, the 2nd District Court of Appeal said that since questions have been raised regarding personal jurisdiction in the alternative forum, staying the action preserves the plaintiffs' right to pursue claims in California, should they fail in Florida.

The plaintiffs brought the claims on behalf of Robert Reaser, who was born in Pennsylvania and maintained his residence in the state while serving in the U.S. Navy from 1951 to 1971. Reaser left the U.S. Navy in 1971, after serving on vessels in California, and moved to Florida, where he worked in construction and in the automobile industry.

In 2008, the plaintiffs filed an asbestos-related lawsuit in California that was later removed to federal court and transferred to the national asbestos MDL. Shortly after the removal, the plaintiffs filed a separate action, also in California, against different defendants. Those defendants, however, moved to dismiss the case on forum non conveniens grounds, arguing that Florida was a more suitable forum for the lawsuit. The trial court agreed, granting the motion, but staying it with the stipulation that the plaintiffs could ask that the stay be lifted if it was determined that some of the defendants were not subject to personal jurisdiction in Florida.

The plaintiffs subsequently filed a Florida action identical to the California one. One of the defendants, Hill Brothers Chemical Co., sought dismissal for lack of personal jurisdiction. Prior to the court's ruling on the defendant's motion, another defendant removed the case to federal court.

The plaintiffs then asked the California trial court to lift the stay, pointing to Hill Brothers Chemical's challenge to personal jurisdiction in the Florida case. The California court opted not to lift the stay, noting that the Florida trial court never ruled on the defendant's motion.

In 2009, the plaintiffs dismissed all of the pending actions and instead filed a new wrongful death lawsuit in California. The defendants once again challenged the suit on forum non conveniens grounds and, once again, the California court agreed. The instant appeal followed.

In addressing the plaintiffs' argument that it has not been established that all of the defendants are subject to personal jurisdiction in Florida, the appellate court found that in a large case such as this one, "the moving defendant need not show that all defendants are subject to jurisdiction in the same alternative forum before an action can be stayed based upon the principle of forum non conveniens."

However, the appellate court did find that while the trial court was correct in finding that a suitable alternative forum, it erred when it decided to dismiss the complaint outright instead of staying it.

"While it was certainly appropriate to consider the residence of the plaintiffs, the court completely ignored the fact that at least one of the defendants -- Hill Brothers -- had claimed in the prior litigation to be a California resident, not subject to jurisdiction in Florida," the court said.

The court continued, stating that "given the history of lawsuits between these parties, in our view, the court was remiss in disregarding the strong likelihood that successful challenges to jurisdiction would be made in Florida. The court's comments instead reflect that its greatest concern was with the perceived burden on the court. It is certainly true that dismissing the case creates less of a burden on the court, than a stay creates. However, if the lower court is correct, that is if the alternative forum is suitable because defendants are subject to jurisdiction in the other forum, then the burden on the court created by a stay and dismissal is the same-none. If the case is resolved in the other jurisdiction, then the ?stayed action will be dismissed. However, in the event the plaintiff cannot obtain relief in the alternative forum, then a stay gives the plaintiff the ability to pursue its claim in California. In our view, the court erred in failing to take full measure of these possibilities."

The court concluded by ruling that the judgment of dismissal was reversed, but the case was remanded with directions to grant the motion and enter an order staying the action.

Counsel for the plaintiffs is Brian P. Barrow of Simon, Eddins & Greenstone.

The defendants are represented by Guy W. Stilson and Sonja E. Blomquist of Low, Ball & Lynch; James P. Cunningham and Susanna G. Arani of Carroll, Burdick & McDonough; Steven M. Mitchel and Jackie K. Vu of Booth, Mitchel & Strange; Keith M. Ameele and Tiffany M. Birkett of Foley & Mansfield; Lillian Ma, Dean E. Short and John Son of Tucker, Ellis & West; Robert E. Feyder, Geoffrey M. David, Nicholas P. Vari and Michael J. Ross of K&L Gates; Philip S. Ward, Robert L. Nelder and Nicole T. Roberts of Hassard Bonnington; Gabriel A. Jackson, Peter K. Renstrom, Ana T. Portillo and Christine A. Huntoon of Jackson, Jenkins Renstrom; Frank D. Pond and Previn A. Wick of Pond North; James J. Yukevich, Steven D. Smelser and Patricia E. Ball of Yukevich, Calfo & Cavanaugh; Michael J. Pietrykowski, Don Willenburg and T. Stephen Corcoran of Gordon & Rees; Ruth Segal, Ryan M. Terschluse and Rosemary H. Do of Lynberg & Watkins; Virginia Vasquez of Vasquez, Estrada & Conway; David T. Biderman and Vick K. Mansourian of Perkins Coie; Robert S. Kraft, Jeffery J. Fadeff and Alice K. Loh of Bassi, Edlin, Huie & Blum; Henry D. Rome, Bobbie R. Bailey and Lisa K. Rauch of Howard, Rome, Martin & Ridley; Laurie J. Hepler and Gonzalo C. Martinez of Carroll, Burdick & McDonough; and Edward R. Ulloa of Hawkins Parnell & Young.

Document is Available Call (800) 496-4319 or Search www.harrismartin.com Opinion Ref# ASB-1011-16

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