Forum Non Conveniens. Third Circuit holds that district court properly dismissed claims by UK residents and their estates against manufacturers allegedly responsible for a fire in a London high-rise apartment building, but erred by conditioning the dismissal on Plaintiff's ability to return to the U.S. court for damages phase.

Kristen Behrens v. Arconic, Inc., Nos. 20-3606, 21-1040, 21-1041 (3d Cir. July 8, 2022) [click for opinion]

On June 15, 2017, a refrigerator-freezer ignited in an apartment in the Grenfell Tower, a London high-rise apartment building. The resulting fire eventually engulfed the entire building in flames. Seventy two people were killed and hundreds more were injured.

Refurbished from 2012 to 2016, the Tower was fitted with a new exterior cladding system consisting of insulation boards attached to the outside of the building and protected from the weather by rainscreen panels. The rainscreen panels themselves consisted of two aluminum sheets bonded together with a layer of highly flammable polyethylene. The public inquiry confirmed that these panels were a primary reason why the fire was able to consume the building's exterior at such a rapid rate.

The fire prompted a public inquiry by then-Prime Minister Theresa May and a criminal investigation by the London Metropolitan Police Service, as well as civil suits in the United Kingdom. Additionally, 245 UK residents and their estates brought a products liability action in Pennsylvania state court against the manufacturers of the panels (Arconic, Inc. and Arconic Architectural Products) and the manufacturer of the refrigerator-freezer alleged to be the source of the fire (Whirlpool Corporation).

After removing to federal court, Defendants moved to dismiss under the doctrine of forum non conveniens, asserting that the lawsuit was more appropriately pursued in the United Kingdom. The district court agreed and dismissed based on forum non conveniens. However, the district court attached several conditions to the dismissal, including that, if the UK court determines that Pennsylvania law applies to damages and that Defendants may be liable for punitive damages, then Plaintiffs may reinstate the action in the Pennsylvania federal court. Plaintiffs appealed the forum non conveniens dismissal, while Defendants cross-appealed the aforementioned condition. Reviewing the dismissal on the applicable abuse of discretion standard, the Third Circuit affirmed.

Plaintiffs first argued that the district court incorrectly afforded only moderate deference to their decision to file in Pennsylvania, asserting that great deference was owed due to the amount of discovery that had already taken place in Pennsylvania. The circuit court held that the district court had properly considered the posture of the proceedings, noting that the discovery that had taken place was limited to the preliminary issue concerning the convenience of the venue and was thus distinguishable from the case cited by Plaintiffs, where significant merits discovery had taken place and a trial date had been set.

Next, the circuit court reviewed the weight afforded to Defendants' inability to implead UK-based third parties, which the district court held favored dismissal. The district court's determination that Defendants' need to pursue contribution claims against other potentially negligent third parties located in the UK—e.g., property owners, architects, and contractors involved in the refurbishment of the Tower—favored dismissal was deemed a reasonable one, and the circuit court declined to disturb it.

Lastly, Plaintiffs challenged the weight afforded to the location of relevant evidence, arguing that the evidence related to their claims was located in the United States or France, not the UK. The flaw in Plaintiffs' argument was that Plaintiffs had focused only on the location of the evidence relevant to their claims, while the court must also consider the location of evidence relevant to Defendants' defenses. Because the UK-based evidence was relevant to Defendants' defenses, the district court properly held that the location of this evidence weighed in favor of dismissal.

However, the circuit court found it was error to allow a damages phase based on United States law to return to the district court. Although conditions on forum non conveniens dismissals are permissible—for example, allowing the suit to return if the new forum rejects it on jurisdictional grounds, or a defendant's agreement to make evidence available in the new forum—the condition allowing an action to return to the U.S. for purposes of damages would result in many of the same inconveniences that prompted dismissal in the first instance.

Concerns as to whether Defendants would be punished for their alleged misconduct were without merit. First, the circuit court noted that there was nothing to suggest that if the UK court, applying U.S. law, determined that punitive damages are appropriate, that it would be incapable of determining an appropriate award. Second, other conditions offered sufficient protection for Plaintiffs' damages, including that if the UK court declined jurisdiction over the damages proceedings, the action could nonetheless return to the U.S. Accordingly, the circuit court struck the dismissal condition.

Benjamin Cody Davis of the Miami office contributed to this summary.