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How to Achieve the Best
Results for Non-American
Victims of Foreign Air Crashes
Marc S. Moller
Kreindler & Kreindler LLP
750 Third Ave.
Ne York,
New
York NY 10017
Ehud Stein, Esq.
St i Singer
Stein,
Si
&C
Co.
Saadia Gaon Street 24
Tel-Aviv, 67135
Israel
John Beer, Esq.
Weteringschans 85-87
1017 RZ Amsterdam
The Netherlands
Urban Olson
Olson, Esq.
Esq
Engelbrektsgatan 9-11 14
32 Stockholm, Sweden
Deborah Elsasser, Esq.
Clyde & Co US LLP
The Chrysler Building
16th Floor
405 Lexington
L i t A
Avenue
New York, New York 10174
Passengers vs. Aviation Defendants
•
Passengers
vs.
• Airline
• Manufacturer
• Maintenance
M i t
Co.
C
• Government
• Other
What are the true competing interests?
P
Passengers
vs. Aviation
A i ti Defendants
D f d t
Passenger
Passengers seek maximum compensation
f Death/Injury
for
D th/I j
Aviation Defendants
•
•
•
•
Avoid Liability, if possible.
Minimize exposure.
Avoid bad publicity and negative PR impact
impact.
Keep costs of doing business as low as
possible maximize profit
possible,
profit.
• Keep insurance premiums as low as possible.
• Insurers,
Insurers the aviation defendants’
defendants surrogate
wants to maximize profit.
• Limit claims
claims.
Surprise!
Plane crashes; what happens?
1. Ambulances come to the scene.
2. Survivors grieve or nurse injuries.
3. Airline expresses condolences.
1. Sets up a hotline
2. Assists passengers
3. Offers
Off
modest cash advances
4. Government investigators come to accident site and
hold news conferences
conferences.
5. Insurers meet and set a tentative “reserve”.
y
6. Victims contact lawyers.
“Hypothetical”*
y
A new twin-engine “Boing” plane operated by
“MLK Airlines” carrying
y g 74 p
passengers
g
crashes
on final approach to Schipol Airport in Amsterdam
the Netherlands. “MLK Airlines” is incorporated and
has its principal place of business in the
Netherlands. “Boing” has its headquarters in
Illinois and has manufacturing facilities
throughout the United States. The “Royce Rolls”
engines which powered the airplane were shipped
p
was
to the United States where the airplane
assembled. The crash caused deaths and injuries...
*Any similarities to actual companies, corporations or entities is purely
coincidental and no inferences should be drawn there from
Cont’d
A post-crash investigation conducted by the Dutch Civil Aviation
Authority concluded that the causes of the crash include
A. A manufacturing defect in the port side Royce Rolls
engine compressor.
B The
B.
Th fli
flight
ht crew’s
’ failure
f il
tto follow
f ll
th
the Pil
Pilott O
Operating
ti
Handbook procedures for continuation of flight following
a single engine failure.
C. Despite the engine failure, had the crew followed the
required single-engine-out emergency procedures the
crash might not have occurred
occurred.
D. The Dutch authority concluded, that the plane and
engine manufacturers and airline share responsibility
f the
for
th accident.
id t
The elephant in the room
Passenger #1
An Israeli resident who carried an Israeli Passport, purchased
his ticket in Tel Aviv
Aviv, was traveling on a TLV
TLV-JFK-TLV
JFK TLV itinerary,
itinerary
perished in the crash. He owned apartments in both New York
and Tel Aviv and maintained cars at both of his homes. In
connection with his professional activities he divided his time
equally between NY and Tel Aviv. He was 35 years old,
survived byy his wife and minor child. His annual earnings
g
were approximately $100,000 U.S. per year. He was also a
principal owner of a high tech company, incorporated in New
York with plans to “go
York,
go public
public” in the U
U.S.
S within six months of
the crash.
The decedent
decedent’s
s wife comes to Ehud Stein and asks “What
What do I do now?”
now?
HEADS OF DAMAGES UNDER ISRAELI LAW
• After 64 years of independence the Israeli
tort law is still much alike the British
Common law system especially as far as
compensation are awarded.
• Few innovations were introduced
introduced, one of
them is highly relevant is compensating
the estate of an accident victim for his
earning in the lost years (i.e. Loss of future
earnings )
earnings.)
In case of fatal accident:
the estate is entitled to:
1. Burial Costs and Expenses (not including
traditional expenses of a specific ethnic
community)
2. Loss of income in the lost years.
* see a comment next slide.
3. non pecuniary damages. (Pain & suffering).
* Modestly awarded.
In case of fatal accident
the dependents are entitled to:
1. The widow may recover her husband’s share
in his retirement pension scheme.
2. To children entitled to loss of support until
18 years and if in compulsory military service
until
til 21.
21
3. Loss of services as husband and father
(this is not lost of companionship ii.e.
e
non-pecuniary damage)
Conflict between heads of
damages
• Estate is entitled to loss of earning in the
lost years (less Expenses spared, approx.
Third)
• Dependents are entitled to recover their
loss of support
support, usually calculated taking
into account the number of house hold
member and the joint income
income.
• Insurer is not exposed to double risk.
• Higher calculation overrules.
In case of bodily injury
•
•
•
•
•
Loss of income (past & future) and pension.
Third party assistance
assistance.
Extra mobility expenses.
Ad t ti off dwelling.
Adaptation
d lli
Medical & rehabilitation treatments and
f iliti required
facilities
i db
beyond
d th
those supplied
li d b
by
the state.
• Non pecuniary damages- pain &suffering.
Calculated according the severity of the
i j
injury.
Passenger #2
A 45 year old Swedish citizen who had come to the United States
on a business trip was travelling on a Stockholm
Stockholm-JFK-TLV-Stockholm
JFK TLV Stockholm
ticket. He sustained catastrophic paraplegic injuries and is permanently
disabled. The victim is married, has a minor child who is 15 years old.
The victim’s wife comes to Urban and asks “How will my husband’s medical
expenses be covered? How will our family meet its living expenses if my
husband can no long work at his $75,000
$
job as an engineer in one of
Holland’s most prominent firms? He was certain to have several promotions,
maybe even to top management job within ten years. Our family has been
de astated b
devastated
by this crash and m
my h
husband’s
sband’s inj
injuries.
ries He is not onl
only ph
physically,
sicall
but psychologically broken and in constant pain. Can you help us?”
HEADS OF DAMAGES UNDER SWEDISH LAW
Injury Case
1. Medical Costs and Other Costs of the Injured Party
and
d Related
R l t dP
Persons
1. Loss of Income
2. Pain and Suffering, Disfigurement and Inconveniences
and “General
General Difficulties
Difficulties”
Death Case
1. Funeral Costs and Related Expenses
2. Loss of Support
3 Traumatic Grief of Relative or People Otherwise
3.
“related” to Decedent
European Union; 27 Member
States
Each with its own legal system
ADVOKATFIRMAN URBAN OLSON
EU Legislation
• Regulations passed by European Parliament
• Directives,
Directives Decisions,
Decisions Recommendations and
Opinions passed by combinations of
Parliament Council and Commission
Parliament,
ADVOKATFIRMAN URBAN OLSON
Rome II Treaty/Regulation (EC) No
864/2007
864/200
• All EU States
• Events occurring after entry into force (Art 31)
• Products: law of country of habitual residence of
victim if product marketed there, Art 5.1 (a)
• Country in which the product was acquired if
product marketed there, Art 5.1 (b)
• Cou
Country
t y where
e e damage
da age occurred
occu ed if p
product
oduct
marketed there, Art 5.1 (c)
The 1973 Hague Convention on
the Law Applicable to Products
Liability:
•
•
•
•
All damage caused by product
P
Personal
l injury
i j
Damage to tangible property
Except product itself and consequential
p
by
y
economic loss unless accompanied
other damage
ADVOKATFIRMAN URBAN OLSON
Signatories
•
•
•
•
•
•
•
•
•
•
•
•
•
Belgium,
Croatia,
Finland
Finland,
France,
Italy,
Luxemburg
Luxemburg,
Netherlands,
Norway,
P t
Portugal,
l
Serbia,
Slovenia,
S i and
Spain,
d
the former Yugoslav Republic of Macedonia.
ADVOKATFIRMAN URBAN OLSON
The 1973 Hague Convention on
th Law
the
L
Applicable
A li bl tto P
Products
d t
Liability:
y
• The law of the state of the principal place
person claimed to be
of business of the p
liable
ADVOKATFIRMAN URBAN OLSON
French Supreme Court decision
December 7,
7 2011
• Found U.S. Court of Appeal decision to
violate § 33 of Montreal 99 Convention
• Refused to exercise jurisdiction
• Probable general applicability in all EU
states “[è]tre appliquée sur l´ensemble du
territoire l´Union européenne sur la base
du critéres uniformes /../” (page 52)
• Result that no EU state is “alternative
forum” for FNC purposes (in carrier cases)
ADVOKATFIRMAN URBAN OLSON
Passenger #3
A 30 year old Dutch citizen who purchased his AMS-TLV-AMS
ticket in Amsterdam also perished in the crash
crash. He is survived
by his parents and was their sole source of support. Since
graduating from university he distinguished himself as one of
Holland’s most accomplished computer scientists and was in
the early stages of what promised to be a highly successful
career. At the time of his death he was earning
g approximately
pp
y
$50,000 per year.
The victim’s father comes to John and says “We are lost without our son.
What do my wife and I do now?”
Dutch Damages
Personal Injury Claims
1. Pain and suffering
2. Medical and other expenses not paid by insurance
p not p
paid through
g social benefits
3. Costs of care and household help
4. Loss of earnings including loss of career opportunities minus disability
5 Out-of-Court
5.
Out of Court attorneys fees and expert costs
Death Claims
1. Burial expenses not paid by insurance
2. Loss of financial (or domestic) support
3. Out-of-Court attorneys fees and expert costs
What about Friendship?
p
• American initiative after World War II
• Development of international trade
• Treaty
y of Friendship,
p, Commerce and
Navigation between the Kingdom of The
Netherlands and the United States of
A
America
i 1956
• “National treatment with respect to access
t the
to
th Courts
C t within
ithi territories
t it i off the
th other
th
Party”
Passenger #4
A 45 year old Connecticut domiciliary and head of household
survived by his wife and two minor children perished in the crash.
He was traveling on a JFK-TLV-JFK ticket purchased in New York.
At the time of his death he enjoyed a career as a hedge fund
manager and earned on-average in excess of $1 million a year.
Who wants this case?
FNC CONSIDERATONS
•
American among passengers and party to law suit (not enough; Air
France 447 crash over Atlantic Ocean)
•
Breach of U.S: corporate policy or safety rules (not enough ; Cessna
Runway Incursion, Milan Italy, kept sole U.S. resident plaintiff)
•
Product designed in the U.S. and evidence there (good enough; Silk
Air)
•
U.S. one of the five exclusive Montreal 99 jurisdictions (not enough;
West Caribbean; however note French Supreme
p
Court decision
December 7, 2011)
ADVOKATFIRMAN URBAN OLSON
FNC CONSIDERATONS Cont’d
Cont d
•
Maintenance of aircraft performed in the U.S. (good enough; West
Caribbean)
•
poses a threat to American travelers ((still untried))
Defect p
•
Cause of defect investigated by U.S. prosecutors (still untried)
•
Not all defendants join FNC motion (expected requirement in U.S.
jurisdictions)
ADVOKATFIRMAN URBAN OLSON
Is The United States the optimum
venue?
• Yes, if FNC cleared and a consolidated
action re carrier liability is not essential
• No, if FNC remains a substantial threat
and there is access to European court that
will apply Hague 1973 Treaty and U.S. law
(e.g. DHL
DHL-Bashkirian
Bashkirian mid
mid-air
air crash)
ADVOKATFIRMAN URBAN OLSON
Forum Non Conveniens in
Montreal Convention Cases
38
The Montreal Convention
•
•
Replaces the Warsaw Convention system of liability
Contains few “new” principles and essentially consolidates the
existing “Warsaw System”
Warsaw Convention (1929)
+ Hague Protocol (1955)
+ Guadalajara Supplementary Convention (1961)
+ Guatemala City Protocol (1971)
+ Montreal Protocol No. 4 (1975)
+ IATA A
Agreements
t (1995)
= Montreal Convention of 1999
Article 1 - Applicability
• Montreal Convention applies to “all international carriage of
persons, baggage or goods performed by aircraft for
reward.”
• Article 1(2) defines “international
international carriage”
carriage
– the place of departure and the place of destination, are
within:
• “the territories of two State Parties”, or
• “the territory of a single State Party, if there is an
agreed stopping place within a territory of another
St t even if that
State,
th t State
St t is
i nott a State
St t Party.”
P t ”
What Treaty
y Applies,
pp
, If Any?
y
State A
State B
State C
•Warsaw Convention •Warsaw Convention
•None
•Hague Protocol
•Hague Protocol
•Montreal Protocol 4 •Montreal Protocol 4
•Montreal Convention
State D
•Warsaw Convention
•Hague Protocol
•Montreal Protocol 4
•Montreal Convention
One-Way Transportation:
State A to State B: Warsaw Convention as amended by Hague Protocol & MP4
St t A tto St
State
State
t D
D: Montreal
M t l Convention
C
ti
State D to State A: Montreal Convention
State A to State C: No treaty applies
Round-Trip Transportation:: The treaty of the state of departure and final destination applies
RoundState A to State B to State A: Montreal Convention
State A to State C to State A: Montreal Convention
Jurisdictional Defenses Under the
Montreal Convention
1. Treaty Jurisdiction: If the Montreal
Convention applies, does a US court have
treaty jurisdiction per Article 33?
2. Forum Non Conveniens: even if there is
jurisdiction in the US, is the US the most
convenient forum in which to litigate the
case?
Treaty Jurisdiction under the
Montreal Convention
•
•
Subject
j
Matter/Treaty
y Jurisdiction: if the carriage
g is
governed by Montreal Convention – does the court have
subject matter jurisdiction in the US per Article 33?
An action for damages must be brought in one of five places:
1. Carrier’s domicile;
2. Carrier’s principal place of business;
3. Place where contract was made;
4. Final destination; or
5 Principal and permanent residence of the pax if there is
5.
personal jurisdiction over the carrier in that jurisdiction (for
bodily injury and death cases).
Forum Non Conveniens (“FNC”)
•
Even if there is Article 33 jjurisdiction in the US,, is
the US the most convenient forum for the litigation?
•
FNC Steps: FNC doctrine as applied by most courts in
the US involves a 3-step analysis:
1 What deference should be given to a plaintiff’s
1.
plaintiff s choice of
forum?
2. Is the an adequate alternative forum?
3. Balance “private interest factors” and “public interest
factors”
Issue: FNC and the Montreal Convention
• If there is treaty jurisdiction under MC Article 33
ma a co
may
court
rt dismiss the action on FNC Grounds?
Gro nds?
– No: Hosaka v. United Airlines, Inc., 305 F.3d 989
(9th Cir. 2002), cert. denied, 537 U.S. 1227 (2003) –
FNC dismissal not allowed if the court has treaty
jurisdiction per Article 28 of the Warsaw Convention.
– Yes: Pierre
Pierre-Louis
Louis v. Newvac Corp., 584 F.3d 1052
(11th Cir. 2009), cert. denied, 130 S. Ct. 3387 (June 7,
2010) – FNC dismissal allowed even if the court has
treaty jurisdiction per Article 33 because Article 33(4)
states that “Questions of procedure shall be governed
by the law of the court seised of the case.” In US, FNC
is a procedural question.
French Cour de Cassation Decision in
West Caribbean Airways – Impact?
US courts have held that a plaintiff’s refusal to
litigate in the alternative forum does not render the
forum “unavailable”
unavailable
• Navarrete De Pedrero v.
v Schweizer Aircraft Corp
Corp.,
635 F. Supp. 2d 251 (W.D.N.Y. 2009)
• Morales v. Ford Motor Co., 313 F. Supp. 2d 672
(S.D. Tex 2004)
French Cour de Cassation Decision in
West Caribbean Airways – Impact?
US courts have refused to reinstate US
lawsuits where there is a manipulation of the
pleadings or proceedings
• In re Air Crash Over the Mid-Atlantic on June 1, 2009, 792 F.
Supp 2d 1090 (N.D.
Supp.
(N D Cal
Cal. 2011)
• Del Istmo Assur. Corp. v. Platon, 2011 WL 5508641 (S.D. Fla.
Nov. 9, 2011)
• In
I re Bridgestone/Firestone,
B id
t
/Fi
t
Inc.
I
Tires
Ti
Products
P d t Liability
Li bilit
Litigation, 470 F. Supp. 2d 917 (S.D. Ind. 2006)
• Aguina v. Texaco, Inc., 142 F. Supp. 2d 534 (S.D.N.Y. 2001)