Bell v. Foster Wheeler Energy Corporation, et al

Filing 434

ORDER AND REASONS re Choice of Law. IT IS ORDERED that, with respect to the alleged Idaho exposures, Louisiana law will apply to the survivorship claim and Idaho law will apply to the punitive damages issue in this wrongful death claim. Signed by Judge Lance M Africk.(bwn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
WILLIAM C. BELL ET AL.

CIVIL ACTION

VERSUS

No. 15-6394

FOSTER WHEELER ENERGY
CORP. ET AL.

SECTION I

ORDER AND REASONS
William Bell was regularly exposed to asbestos while serving as an engineman,
machinery repairman, and a machinist mate in the United States Navy in the 1960s.
The majority of Mr. Bell’s exposure occurred while he was serving at sea on four ships,
and it is settled that general maritime law governs liability for those exposures. But
Mr. Bell also claims that he was exposed to asbestos during a six month period in
which he was training at the land-based Naval Reactors Facility in Idaho. Through
earlier summary judgment briefing, it became apparent that the parties disagreed as
to whether Idaho law or Louisiana law applied to the Idaho exposures. The Court
ordered additional briefing 1 on the issue. Defendants argue that Idaho law applies,
and plaintiffs argue that Louisiana law governs.
I.
Louisiana’s choice of law rules determine which state’s law applies.
Mumblow v. Monroe Broad., Inc., 401 F.3d 616, 620 (5th Cir. 2005).

See

Under

Louisiana’s choice of law approach, “if the laws of the states do not conflict, then no
1

R. Doc. Nos. 371, 373, 384, 387.

choice of law analysis is necessary, and [courts should] simply apply the law of the
forum state.” Id.; see also Champagne v. Ward, 893 So. 2d 773, 786 (La. 2005).
Further, “[u]nder Louisiana’s choice of law rules, a sweeping determination that the
law of one state applies to the case, as opposed to an issue in a case, constitutes a
derogation of the appropriate analysis.” Favaroth v. Appleyard, 785 So. 2d 262, 265
(La. App. 4 Cir. 2001). “When a conflict exists with regard to more than one issue,
each issue should be analyzed separately.” Id.; see also La. Civ. Code art. 3515,
comment (d) (“This Article does not prohibit dépeçage[, however] [t]he unnecessary
splitting of the case should be avoided, especially when it results in distorting the
policies of the involved states.”).
The parties identify two pertinent conflicts. First, Louisiana allows a survival
action under these circumstances and Idaho does not. 2 Second, Idaho allows the
The Louisiana Civil Code provides for the survival of tort claims without
qualification. La. Civ. Code art. 2315.1 (“If a person who has been injured by an
offense or quasi offense dies, the right to recover all damages for injury to that person,
his property or otherwise, caused by the offense or quasi offense, shall survive. . . .”).
In Idaho, survival claims for all damages except damages for the decedent’s pre-death
pain and suffering are permitted only when the decedent’s death was not related to
the wrongful act or negligence. See Idaho Code § 5–327(2) (“A cause of action for
personal injury or property damage caused by the wrongful act or negligence of
another shall not abate upon the death of the injured person from causes not related
to the wrongful act or negligence. Provided however, that the damages that may be
recovered in such action are expressly limited to those for: (i) medical expenses
actually incurred, (ii) other out-of-pocket expenses actually incurred, and (iii) loss of
earnings actually suffered, prior to the death of such injured person and as a result
of the wrongful act or negligence.”).
In Evans v. Twin Falls Cty., 796 P.2d 87, 92 (Idaho 1990), the Supreme Court
of Idaho explained that “[a]t common law if the victim of a tort died before he
recovered a judgment, the victim’s right of action also died.” Because Iowa Code § 73116 provides that the rules of the common law are in effect in Idaho unless modified
by other legislative enactments, see id., the fact that Idaho Code § 5–327(2) only
allows for survival actions where the decedent’s death was not caused by the wrongful

2

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recovery of punitive damages in a wrongful death action and Louisiana does not. 3
The Court analyzes each conflict separately and concludes that Louisiana law should
apply to the survivorship claim, but that Idaho law should apply to the punitive
damages issue. 4
II.
Unlike many other American jurisdictions, Louisiana has always had codified
choice of law rules. Trizec Properties, Inc. v. U.S. Mineral Prod. Co., 974 F.2d 602,
604-05 (5th Cir. 1992).

Louisiana’s general choice of law rules are set forth in

Louisiana Civil Code article 3542. Marchesani v. Pellerin-Milnor Corp., 269 F.3d 481,
487 (5th Cir. 2001). Article 3542 provides:
an issue of delictual or quasi-delictual obligations is governed by the law of the
state whose policies would be most seriously impaired if its law were not
applied to that issue. That state is determined by evaluating the strength and
pertinence of the relevant policies of the involved states in the light of: (1) the
pertinent contacts of each state to the parties and the events giving rise to the
dispute, including the place of conduct and injury, the domicile, habitual
conduct means that in cases where the decedent’s death was caused by the wrongful
conduct, no survival claim is permitted.
3Compare Pfau v. Comair Holdings, Inc., 15 P.3d 1160, 1165 (Idaho 2000)
(recognizing that punitive damages are recoverable in such actions) and Manning v.
Twin Falls Clinic & Hosp., Inc., 830 P.2d 1185, 1191 (Idaho 1992) (affirming jury
award of punitive damages in wrongful death claim under Idaho law) with Ross v.
Conoco, Inc., 828 So. 2d 546, 555 (La. 2002) (punitive damages only recoverable when
expressly authorized by statute). Although plaintiffs argue that Louisiana law
applies, they note the punitive damages conflict in the event the Court concludes that
Idaho law governs.
4 The parties also argue in lengthy footnotes whether either Louisiana or Idaho
permits recovery based on an unreasonably dangerous per se theory of strict liability.
But as even the defendants recognize in their briefing, the defendants have found “no
authority” either approving or disapproving of such a theory under Idaho law. See R.
Doc. No. 384, at 3 n.6. Accordingly, the defendants have not carried their burden of
demonstrating a conflict between Louisiana law and Idaho law, and Louisiana law
will apply by default. The Court makes no holding at this time as to whether
Louisiana law would provide for such a theory of recovery under the facts of this case.
3

residence, or place of business of the parties, and the state in which the
relationship, if any, between the parties was centered; and (2) the policies
referred to in Article 3515, as well as the policies of deterring wrongful conduct
and of repairing the consequences of injurious acts.
La. Civ. Code art. 3542.
Louisiana Civil Code article 3515, in turn, is the “general and residual rule”
that guides and informs Louisiana’s approach to choice of law and is closely paralleled
by article 3542. Marchesani, 269 F.3d at 486. Article 3515 provides that, except as
otherwise specified in the part of the Civil Code addressing choice of law:
an issue in a case having contacts with other states is governed by the law of
the state whose policies would be most seriously impaired if its law were not
applied to that issue. That state is determined by evaluating the strength and
pertinence of the relevant policies of all involved states in the light of: (1) the
relationship of each state to the parties and the dispute; and (2) the policies
and needs of the interstate and international systems, including the policies of
upholding the justified expectations of parties and of minimizing the adverse
consequences that might follow from subjecting a party to the law of more than
one state.
La. Civ. Code art. 3515.
Louisiana Civil Code articles 3543 through 3546 provide more specific choice
of law rules which dictate the appropriate choice of law in certain scenarios. La. Civ.
Code art. 3542, comment (b). When applicable, those articles generally prevail over
the more generalized rules provided in article 3542. Id.; see also La. Civ. Code art.
3547. Because none of the more precise choice of law rules provided in articles 3543
through 3546 specifically apply under the facts of this case, however, the Court’s
analysis is guided primarily by articles 3542 and 3515.

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A.
The Court first addresses the survival claim. Pursuant to articles 3515 and
3542, the Court begins the analysis by identifying “the pertinent contacts of each
state,” including “the place of conduct and injury, the domicile, habitual residence, or
place of business of the parties, and the state in which the relationship, if any,
between the parties was centered.”

La. Civ. Code arts. 3515, 3542; see also

Marchesani, 269 F.3d at 487. The first contacts to identify are the place of the alleged
tortious conduct and the place of injury. Although William Bell was diagnosed with
mesothelioma in Louisiana in 2015, Louisiana law considers Idaho to be the place
where William Bell’s injury occurred for purposes of the survival action. See Rando
v. Anco Insulations Inc., 16 So. 3d 1065, 1083 (La. 2009) (“[Plaintiff’s] injury occurred
at the time of significant exposure to asbestos, not later when his disease
(mesothelioma) manifested itself.”). 5 As for the place where the alleged tortious
behavior occurred, Idaho is clearly the state with the pertinent connection. All of the
alleged tortious conduct took place in Idaho, and none of the alleged exposures
occurred in Louisiana.
The next contact to identify is the place of domicile. Under Louisiana choice of
law rules, courts look to the domicile of the decedent when considering a survival
action. See La. Civ. Code art. 3544, comment (b). Although he spent a number of
years outside of the State due to his naval service, William Bell was officially
domiciled in Louisiana his entire life. The defendants are domiciled in various states,
Although the plaintiffs oppose this conclusion, what courts in other states have said
about the choice of law rules in other states bears little relevance to the analysis.

5

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but none of them is domiciled in Louisiana or Idaho. As for the place where the
relationship between William Bell and the defendants was centered, that must be
Idaho as well. Indeed, both the alleged wrongful conduct and the injury occurred
there.
Having identified the relevant contacts, the second step pursuant to articles
3515 and 3542 requires the Court to consider the state policies that might be
implicated in the choice of law. See La. Civ. Code arts. 3515, 3542; Marchesani, 269
F.3d at 487. Both Idaho and Louisiana may have policy interests which could be
implicated by the choice of law. Idaho, like all states, has an interest in regulating
conduct within its borders. Louisiana, on the other hand, has an interest in seeing
its injured citizens fully compensated—irrespective of where their injury occurs.
After all, even when Louisiana domiciliaries are not injured in Louisiana, the effects
and especially the expense of an injury will surely be felt here.
The third step of the choice of law analysis set forth by articles 3515 and 3542
requires the Court to evaluate the “strength and pertinence” of each state’s policy
interests in light of “the policies and needs of the interstate and international
systems” so as to determine which state’s policies would be “most severely impaired”
if its law was not applied. See La. Civ. Code arts. 3515, 3542; Marchesani, 269 F.3d
at 487. After doing so, the Court concludes that Louisiana’s interests are stronger
and would be more severely impaired if its survival law was not applied under these
circumstances. See Louisiana Practice Series § 12:5 (“[E]ach state having factual
contacts with a given multi-state case may not have an equally strong interest in

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regulating all issues in the case, but only those issues that actually implicate its
policies in a significant way.”).
The Court notes that in the tort context, Louisiana choice of law rules
distinguish “issues pertaining to standards of conduct and safety” from “issues of loss
distribution and financial protection.” Compare La. Civ. Code art. 3543 6 with La.
Civ. Code art. 3544. 7 The commentary to the Civil Code explains that the distinction
6

Article 3543 provides:
Issues pertaining to standards of conduct and safety are governed by the law
of the state in which the conduct that caused the injury occurred, if the injury
occurred in that state or in another state whose law did not provide for a higher
standard of conduct.
In all other cases, those issues are governed by the law of the state in which
the injury occurred, provided that the person whose conduct caused the injury
should have foreseen its occurrence in that state.
The preceding paragraph does not apply to cases in which the conduct that
caused the injury occurred in this state and was caused by a person who was
domiciled in, or had another significant connection with, this state. These cases
are governed by the law of this state.

La. Civ. Code art. 3543.
7 Article 3644 provides:
Issues pertaining to loss distribution and financial protection are governed, as
between a person injured by an offense or quasi-offense and the person who
caused the injury, by the law designated in the following order:
(1) If, at the time of the injury, the injured person and the person who caused
the injury were domiciled in the same state, by the law of that state.
Persons domiciled in states whose law on the particular issue is
substantially identical shall be treated as if domiciled in the same state.
(2) If, at the time of the injury, the injured person and the person who caused
the injury were domiciled in different states: (a) when both the injury and
the conduct that caused it occurred in one of those states, by the law of that
state; and (b) when the injury and the conduct that caused it occurred in
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“draws from the substantive law of torts and its two fundamental objectives—
deterrence and compensation.” La. Civ. Code art. 3543, comment (a). While the line
between the two categories of law is not always clear, rules relating to conduct and
safety generally encompass the so-called “rules of the road,” or rules which regulate
conduct. See id.; S. Symeonides, Louisiana’s New Law of Choice of Law for Tort
Conflicts: An Exegesis, 66 Tul. Law Rev. 677, 699-705 (1992).

Issues of loss

distribution and financial protection, on the other hand, include rules which—for
example—impose a ceiling on the amount of compensatory damages available or rules
which provide immunity from suit. See id.
According to the Civil Code’s commentary, “[a] state’s policy of deterrence
embodied in its conduct-regulating rules is implicated in all substandard conduct that
occurs within its territory, even if the parties involved are not domiciled in that state.”
Id. “Conversely, a state’s loss-distribution policy may or may not extend to nondomiciliaries acting within its territory, but does extend to domiciliaries even when
they act outside the state.”

Id.

In other words, conduct-regulating rules are,

generally speaking, tied to territoriality whereas loss-compensating rules are tied to
domicile. Symeonides, 66 Tul. Law Rev. at 703. The distinction between conductdifferent states, by the law of the state in which the injury occurred,
provided that (i) the injured person was domiciled in that state, (ii) the
person who caused the injury should have foreseen its occurrence in that
state, and (iii) the law of that state provided for a higher standard of
financial protection for the injured person than did the law of the state in
which the injurious conduct occurred.
La. Civ. Code art. 3544.

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regulating rules and loss-compensating rules is important to the choice of law
decision between Louisiana’s survivorship law and Idaho’s survivorship law.
In Marchesani, the Fifth Circuit emphasized that under Louisiana’s choice of
law rules, “the ultimate question is not which state has the most significant interest
in the dispute, but rather which state’s policies would be most seriously impaired if
its law were not applied to the issue.” 269 F.3d at 488 (internal quotation marks and
citations omitted).

Furthermore, the Fifth Circuit noted that the Louisiana

legislature “has made clear that ‘[w]hat is to be evaluated is not the wisdom or
goodness of a state policy, either in the abstract or vis-à-vis the policy of another state,
but rather the strength and pertinence of this policy in space.’” Id. (quoting La. Civ.
Code art. 3515, Revision Comment (c)).
On the one hand, the alleged wrongful conduct and injury occurred in Idaho.
On the other hand, the consequences of that conduct and injury are felt most acutely
here in Louisiana where William Bell resided, where he was diagnosed with
mesothelioma and died, and where his brother John Bell currently resides. As such,
Louisiana’s interests would suffer the greater impairment if a Louisiana domiciliary’s
injury remained unremedied by the operation of another state’s law.

Idaho’s

interests, in contrast, cannot be viewed as greatly impaired by the application of
Louisiana law under these circumstances.
After all, it is not as if Idaho prohibits all survival actions in all circumstances.
As the Court observed in supra note 2, if a decedent’s death occurred “from causes
not related to the wrongful act or negligence,” a survival action is permitted under
Idaho law. See Idaho Code § 5–327(2). It follows that the application of Louisiana’s
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survivorship provision—albeit in circumstances not recognized in Idaho—cannot be
said to completely undermine Idaho public policy.
Further, because the availability of a survivorship action is better
characterized as a loss-compensating rule and not a conduct-regulating rule, the
personal contacts of this litigation to Louisiana are more significant than the
territorial contacts of this litigation to Idaho with respect to the survivorship issue.
Although the specific choice of law provisions set forth in articles 3543 to 3546 of the
Louisiana Civil Code are not determinative of the inquiry under these facts, they are
nevertheless instructive in gauging the strength of Louisiana’s policy interests. In
light of Louisiana’s strong interest in ensuring that its domiciliaries are
compensated—even when their injury occurs outside of Louisiana, and considering
that Idaho’s policy with respect to its survivorship law will not be greatly undermined
by the application of Louisiana law in these circumstances, the Court concludes that
Louisiana’s policy interests would suffer the greater impairment if its law was not
applied.
B.
Next, the Court considers whether Idaho law or Louisiana law should apply to
the question of punitive damages in a wrongful death suit. The Court again begins
the analysis by identifying the pertinent contacts. As previously explained, Idaho is
the state where the alleged tortious conduct occurred. But unlike the injury in the
survival action, the injury in the wrongful death action is deemed to have occurred in
Louisiana. As a wrongful death action is meant to compensate a survivor for the
injury he suffers upon the death of a relative or spouse, John Bell did not sustain an
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injury until his brother William died. See Watkins v. Exxon Mobil Corp., 145 So. 3d
237, 241 (La. 2014) (“The wrongful death action is intended to compensate the
beneficiaries for compensable injuries suffered from the moment of death and
thereafter.”) (citation omitted). Because William Bell died in this state, that is where
John Bell’s injury occurred.
Louisiana is also the state with the relevant domiciliary connection. Under
Louisiana choice of law rules, courts look to the domicile of the surviving plaintiff
when considering a wrongful death action. See La. Civ. Code art. 3544, comment (b).
As previously noted, John Bell—the wrongful death claimant—is domiciled in
Louisiana.

Also as previously noted, none of the defendants are domiciled in

Louisiana or Idaho. With respect to “the state in which the relationship, if any,
between the parties was centered,” see La. Civ. Code art. 3542, the Court concludes
that the relationship between John Bell and the defendants cannot be considered
“centered” in either Louisiana or Idaho. After all, the conduct occurred in one state
and the injury occurred in another.
Turning to the policies implicated by the pertinent contacts, Idaho undoubtedly
has a policy interest in regulating the behavior of companies that operate within its
borders. As punitive damages are intended to deter wrongful conduct, Idaho has an
interest in seeing its punitive damages law applied to alleged tortious conduct
occurring in Idaho. But the Court has difficulty locating a relevant Louisiana policy
interest. While Louisiana surely has an interest in seeing its injured citizens fully

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compensated, punitive damages are intended not to compensate but to punish, and
none of the alleged reckless behavior in this case occurred in Louisiana. 8
The Court finds that Idaho’s interests would suffer the greater impairment if
its law was not applied. As explained in the previous section, Louisiana’s choice of
law analysis distinguishes between conduct-regulating rules and loss-allocating
rules. According to the Civil Code’s commentary, “[a] state’s policy of deterrence
embodied in its conduct-regulating rules is implicated in all substandard conduct that
occurs within its territory, even if the parties involved are not domiciled in that state.”
La. Civ. Code art. 3543, comment (a). As punitive damages are intended to regulate
conduct and not to compensate victims, it is difficult to understand why Louisiana
would have a strong policy interest in seeing its punitive damages law applied in this
context. Idaho’s interests, on the other hand, would be more severely undermined if
its conduct-regulating rules were not applied to Idaho conduct.
Further, the “policies and needs of the interstate and international systems,
including the policies of upholding the justified expectations of parties and of
minimizing the adverse consequences that might follow from subjecting a party to
the law of more than one state,” counsel in favor of applying Idaho law. See La. Civ.
Code art. 3515. As the defendants emphasize, it would be unreasonable to subject
companies doing business in Idaho to different and perhaps even conflicting
The Court does recognize that “[a]lthough the purpose of punitive damages is to
punish and deter, the injured party receives the benefit of such payment and from
the plaintiff’s standpoint, punitive damages are additional compensation for the
egregious conduct inflicted upon him.” Creech v. Aetna Cas. & Sur. Co., 516 So. 2d
1168, 1173 (La. Ct. App. 1987).
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standards of conduct depending on where individual employees are domiciled.
Upholding the justified expectations of the parties requires application of Idaho law
to regulate Idaho conduct. Idaho law should apply to the punitive damages issue on
the wrongful death claim.
III.
For the foregoing reasons,
IT IS ORDERED that, with respect to the alleged Idaho exposures, Louisiana
law will apply to the survivorship claim and Idaho law will apply to the punitive
damages issue in this wrongful death claim.

New Orleans, Louisiana, March 6, 2017.

_________________________________________
LANCE M. AFRICK
UNITED STATES DISTRICT JUDGE

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