Judge: Michael P. Linfield, Case: 21STCV42265, Date: 2022-09-28 Tentative Ruling
Case Number: 21STCV42265 Hearing Date: September 28, 2022 Dept: 34
SUBJECT: Motion
to Stay or Dismiss Action Based on Forum Non Conveniens
Moving Party: Defendant
Global Reinsurance Corporation of America (“Global”)
Resp. Party: Plaintiff
Pacific Employers Insurance Company (“Pacific”)
Defendant Global Reinsurance Corporation of America’s Motion to Stay or
Dismiss Action Based on Forum Non Conveniens is GRANTED. The action is DISMISSED.
I.
BACKGROUND
On November 16, 2021, Plaintiff Pacific Employers Insurance Company
filed a complaint against Defendant Global Reinsurance Corporation of America
alleging the following causes of action:
1.
Breach
of Contract
2.
Declaratory
Relief as to the Facultative Certificate
On November 18, 2021, Plaintiff Pacific Employers Insurance Company
filed a First Amended Complaint against Defendant Global Reinsurance
Corporation of America alleging the following causes of action:
1.
Breach
of Contract
2.
Declaratory
Relief as to the Facultative Certificate
On August 9, 2022, Defendant Global Reinsurance Corporation of America
(“Global”) moved the Court “for an order dismissing this action or, in the
alternative, staying all further proceedings. The motion will be made on the
ground that California is an inconvenient forum for trial of this action and in
the interest of substantial justice this action should be heard in a forum
outside of this State. Code Civ. Proc §§ 418.10(a); 410.30(a).” (Motion, p.
2:1-4.)
On September 6, 2022, Plaintiff Pacific Employers Insurance Company
(“Pacific”) opposed Global’s motion to stay or dismiss for forum non
conveniens.
On September 20, 2022, Global replied to Pacific’s opposition.
II.
ANALYSIS
A.
Request
for Judicial Notice
On August 9, 2022, Defendant Global Reinsurance Corporation of America
requested that the Court take judicial notice of the following documents in
support of Global’s Motion to Stay or Dismiss Based on Forum Non Conveniens.
1.
Exhibit
1 The Amended Complaint for Damages and Declaratory Relief and Exhibit A
thereto filed in the present action styled Pacific Employers Insurance Company
v. Global Reinsurance Corporation of America, Case No. 21STCV42265;
2.
Exhibit
2- The first page of the most recent Annual Statement filed by Global with the
Pennsylvania Secretary of State which evidences that Global is organized and
incorporated under the laws of New York, its principal place of business is in
Philadelphia, Pennsylvania and the primary location of its books and records is
in Philadelphia, Pennsylvania.
Global’s request for judicial notice of Exhibit 1 is DENIED as
superfluous. Any party that wishes to draw the Court’s attention to a matter
filed in this action may simply cite directly to the document by execution and
filing date. (See Cal. Rules of Court, rule 3.1110(d).)
The Court GRANTS Global’s request for judicial notice of Exhibit 2
pursuant to Evidence Code § 452(c).
B.
Legal
Standard
A defendant, on or before the last day of his or her time to plead or
within any further time that the court may for good cause allow, may serve and
file a notice of motion to stay or dismiss the action on the ground of
inconvenient forum. (CCP, § 418.10(a)(2). When a court upon motion of a party
or its own motion finds that in the interest of substantial justice an action
should be heard in a forum outside this state, the court shall stay or dismiss
the action in whole or in part on any conditions that may be just. (CCP, §
410.30(a).)
"Forum non conveniens is an equitable doctrine invoking the
discretionary power of a court to decline to exercise the jurisdiction it has
over a transitory cause of action when it believes that the action may be more
appropriately and justly tried elsewhere. . . . In determining whether to grant
a motion based on forum non conveniens, a court must first determine whether
the alternate forum is a “suitable” place for trial. If it is, the next step is
to consider the private interests of the litigants and the interests of the
public in retaining the action for trial in California. The private interest
factors are those that make trial and the enforceability of the ensuing
judgment expeditious and relatively inexpensive, such as the ease of access to
sources of proof, the cost of obtaining attendance of witnesses, and the
availability of compulsory process for attendance of unwilling witnesses. The
public interest factors include avoidance of overburdening local courts with
congested calendars, protecting the interests of potential jurors so that they
are not called upon to decide cases in which the local community has little
concern, and weighing the competing interests of California and the alternate
jurisdiction in the litigation." (Stangvik v. Shiley Inc. (1991) 54
Cal.3d 744, 751 [cleaned up].)
“An alternative forum is “suitable” if it has jurisdiction and an
action in that forum will not be barred by the statute of limitations.” (C. Forum
Non Conveniens, Cal. Prac. Guide Civ. Pro. Before Trial Ch. 3-C; Guimei
v. General Elec. Co. (2009) 172 CA4th 689, 696, 91 CR3d 178, 185; Chong
v. Sup.Ct. (HBZ Finance Ltd.) (1997) 58 CA4th 1032, 1036-1037.)
"On a motion for forum non conveniens defendant, as the moving
party, bears the burden of proof. The granting or denial of such a motion is
within the trial court's discretion, and substantial deference is accorded its
determination in this regard." (Id.) A nonresident plaintiff
"who files suit in California is entitled to due deference under the
circumstances presented, not a strong presumption, in favor of its choice of
forum. That deference is to be weighed and balanced by the trial court along
with all the other pertinent factors, including the defendant's residence or
principal place of business, and has no direct bearing on the moving
defendant's burden of proof." (National Football League v. Fireman's
Fund Ins. Co. (2013) 216 Cal.App.4th 902, 929.)
The court's ruling on a forum non conveniens motion may turn on whether
dismissal, or only a stay, is sought. If a stay is granted, the California
court retains jurisdiction, so that if for any reason plaintiff is denied a
prompt trial in the alternative forum, the California court can order the
action resumed in California. On the other hand, once a dismissal is ordered,
the California court loses jurisdiction and there is nothing left to resume.
For this reason, the court's power to dismiss an action for inconvenient forum
is more limited than its power to stay. (C. Forum Non Conveniens, Cal. Prac.
Guide Civ. Pro. Before Trial Ch. 3-C; Archibald v. Cinerama Hotels
(1976) 15 Cal.3d 853, 858-859.)
C.
Discussion
1.
Timeliness
Pacific argues that Global’s motion is untimely under CCP § 418.10(b)
because Global made a general appearance in the case and waited nine months
while availing itself of California courts before filing the present motion.
(Opposition, MPA, 4:3—6:23.)
However, a defendant may, not must, serve and file a motion to stay or
dismiss based on inconvenient forum within the timing framework of CCP §
418.10(a). There is no time limit for filing a motion to stay or dismiss based
on inconvenient forum and filing such a motion one year after a case is filed
may be permissible, especially when no prejudice to a plaintiff is found. (Morris
v. AGFA Corp. (2006) 144 Cal.App.4th 1452, 1461.)
The Court does not find evidence to suggest that granting the present
motion would prejudice Pacific. Discovery between the parties only recently
began. (Dubner Decl., ¶ 10; Tabb Decl. (Reply), ¶ 6.) Thus, the Court finds
that the present motion is timely under Morris.
2.
Suitability
of Alternative Forum
Global argues that the suitability requirement for stay or dismissal
based on forum non conveniens is satisfied by the Commonwealth of Pennsylvania
because (1) a Pennsylvania state court may exercise personal jurisdiction or
Pacific and Global because Pacific is a Pennsylvania corporation, both parties
have their principal place of business in Pennsylvania, and Global has
significant contacts with the alternative forum, (2) the statute of limitations
on written contract actions has not run in Pennsylvania, and (3) Pennsylvania
law recognizes facultative reinsurance contract causes of action. (Motion, MPA, p. 10:5-23.)
The Court finds no evidence that Pennsylvania is an unsuitable forum.
3.
Private
Interest Factors
Global notes the following:
1)
Both
parties reside in Pennsylvania, not California. (Motion, MPA, p. 11:10-16,
First Amended Complaint, ¶ 1; Request for Judicial Notice, p. 2:9-12, Ex. 2.)
2)
Relevant
witnesses reside and/or work outside California. (Motion, MPA, p. 11:17-27;
Reinsel Decl., ¶ 2; Burke Decl., ¶3; Brandt Decl., ¶¶ 3, 5, Ex. 5.)
3)
Global’s
documents “are maintained in Pennsylvania and Global’s business records related
to the issuance of the Certificate are located in New York.” (Request for
Judicial Notice, p. 2:9-12, Ex. 2; Brandt Decl., ¶ 4.)
4)
Relevant
events to the action occurred outside California. (Motion, MPA, p. 12:8-21;
Burke Decl., ¶¶ 2-4, Ex. 4; Reinsel Decl., ¶¶ 3-5, Ex. 3; Brandt Decl., ¶¶ 2-8,
Exs. 5-8.)
Pacific argues that Global did not specify whether two of its
identified witnesses are within Pennsylvania state courts’ subpoena power.
(Opposition, p. 7:21-22.) Pacific notes that technological advances should
render the physical location of Global’s relevant documents mainly irrelevant.
(Opposition, p. 7:23—8:10.) Pacific also notes that the facultative reinsurance
certificate “was placed by a California broker for a California insurer with a
New York-based reinsurer; as a result, that factor favors California.”
(Opposition, p. 8:6-7.)
4.
Public
Interest Factors
Global notes that Pacific is not a California corporation and has not
resided in California for twenty years. (Motion, MPA, p. 13:3-4, 14:9.) Global
argues that public interest factors favor the motion given overburdened
California court dockets given the ongoing COVID-19 pandemic, and low
Californian interest “in litigating a dispute brought by a corporation that has
not been a California resident in more than 20 years, seeking reinsurance under
a contract issued decades ago for underlying asbestos lawsuits that were filed
nationwide where only 1.5% of those lawsuits were filed in California.”
(Motion, MPA, p. 14:8-11.) Pacific notes that state court calendars were
affected by COVID-19 universally and that Global presents no evidence that
Pennsylvania’s courts endure less calendar overcrowding than California’s.
(Opposition, p. 8:23-25.) Pacific notes further “California’s strong public
interest in assuring that reinsurance proceeds are available for a policy
issued by a California insurer to a California insured.” (Opposition, p.
9:5-6.)
5.
Conclusion
The Court finds that the parties’ residences, the residences of
relevant witnesses, the location of relevant events to the present action weigh
in favor of the present motion. (The Court does not find Global’s argument
about the COVID-19 pandemic to be persuasive; the pandemic has affected all
courts throughout the country.) This case involves litigating the responsibilities
of two foreign corporations under a decades-old contract for underlying
lawsuits mostly filed outside California.
Pennsylvania is a suitable – and less costly – forum. Since the Statute
of Limitations in Pennsylvania has not run, this case can be filed in that
foreign jurisdiction.
III.
CONCLUSION
Defendant Global Reinsurance Corporation of America’s Motion to Stay or
Dismiss Action Based on Forum Non Conveniens is GRANTED. The action is DISMISSED.