Argument Recap: Sinochem v. Malaysia Int’l Shipping on 1/9

The following argument recap was written by Melanie Bostwick of Harvard Law School. Her preview of this can be found here.

Tuesday’s argument in Sinochem v. Malaysia Int’l Shipping, No. 06-102, suggested that the Court is likely to rule in favor of petitioner Sinochem by holding that a district court may dismiss a suit on forum non conveniens grounds before conclusively determining that it has jurisdiction over the case and parties.

The Justices had few questions for petitioner’s attorney, Gregory A. Castanias. Mr. Castanias therefore had plenty of time to reiterate the arguments set forth in Sinochem’s brief: that a ruling in its favor would be faithful to the Court’s precedent, that no exercise of hypothetical jurisdiction is required to dismiss for forum non conveniens before determining jurisdiction, and that Sinochem’s desired holding would promote the goals of judicial economy, constitutional avoidance, and international comity. Mr. Castanias fielded brief questions from Justices Kennedy and Ginsburg about the binding effect of one district court’s forum non conveniens determination in the event that, following dismissal, plaintiff brought the case in a different federal court. The attorney stated that he knew of no case in which this had happened, but that the forum non conveniens determination and any analysis of relevant factors would likely be persuasive to the second court, but would not be preclusive, because of the multifactor, discretionary nature of the test. Justice Ginsburg also inquired about an issue raised by respondent MISC in its brief, asking whether the existence of personal jurisdiction has a bearing on the forum non conveniens analysis. Mr. Castanias acknowledged that it does in some cases, but emphasized that the present litigation is not such a case. Finally, Mr. Castanias pointed to the lack of any U.S. interests involved in the dispute between Sinochem and MISC.

The Justices had more questions for Douglas Hallward-Driemeier, who argued on behalf of the United States as amicus curiae in support of Sinochem. In response to Mr. Hallward-Driemeier’s opening statement that forum non conveniens, like supplemental jurisdiction or abstention, can be determined before jurisdiction, Justice Ginsburg asked whether the Court’s language in Gulf Oil Corp. v. Gilbert indicated that the doctrine of forum non conveniens presupposes the existence of jurisdiction. Mr. Hallward-Driemeier clarified that in that case, the Court was responding to a suggestion that because jurisdiction did exist, a court was unable to dismiss for forum non conveniens. He also affirmed, in response to a question from Justice Stevens, that the United States was arguing that forum non conveniens can be considered before both subject-matter and personal jurisdiction. Justice Kennedy renewed his question about the preclusive effect of one district court’s forum non conveniens dismissal if the case is brought in a second federal court. Justice Scalia joined in, asking why there should be any preclusive effect when the doctrine is entirely discretionary. Mr. Hallward-Driemeier answered that the second federal court could reexamine the issue; this result is consistent with previous cases holding that a federal court’s forum non conveniens analysis is not binding on a state court, nor a state court’s analysis on a federal court. Toward the end of the government’s argument time, Justice Ginsburg raised an issue not addressed in the parties’ briefs: whether conditional dismissal, which is common in forum non conveniens cases, is possible when the court imposing the condition may not have jurisdiction over the party intended to be bound. Mr. Hallward-Driemeier asserted that conditional dismissals would still be appropriate under the government’s desired rule; in the event that the defendant broke the condition, the plaintiff could return to the district court to reopen the litigation.

Ann-Michele G. Higgins, counsel for respondent MISC, faced more challenges from the Justices during her argument than did her opponents. Ms. Higgins began by offering three reasons for the Court to rule in MISC’s favor and require district courts to determine jurisdiction before undertaking the forum non conveniens analysis: consistency with Gulf Oil, the advantages of a clear bright-line rule, and the fact that the doctrine presupposes jurisdiction. She then started to explain that forum non conveniens is not entirely separate from the merits of a case. After Ms. Higgins pointed out that on appeal from a forum non conveniens dismissal the appellate court would look at jurisdiction, Justice Scalia interjected to ask how that added to MISC’s case. Ms. Higgins responded that it demonstrated that MISC’s proffered rule does not waste judicial resources, since jurisdiction is likely to be considered on appeal even if the district court does not reach it. Justice Stevens then expressed a concern that cases such as this lack a case or controversy on appeal, given that dismissal is inevitable regardless of the existence of personal jurisdiction. In response, Ms. Higgins pointed to the dispute over the negligent misrepresentation claim. Justice Ginsburg then turned the discussion to whether there was any reason for an American court to be involved in determining whether a fraud had been committed on a Chinese court; when Ms. Higgins quoted the Chinese court as saying that the American litigation would not affect its proceedings, Justice Ginsburg opined that this was merely a polite way of saying that the U.S. court had no business hearing the case.

The rest of Ms. Higgins’s time was devoted to a discussion with Justices Scalia and Ginsburg about the fact that the case was going to be dismissed whether or not personal jurisdiction was considered by the district court. When Ms. Higgins, in response to a question from Justice Scalia, stated that the defendant might waive personal jurisdiction if it was found not to exist, Justice Ginsburg pointed out that such a waiver would not be forthcoming from a defendant who had moved to dismiss for forum non conveniens in the first place. The Justices were skeptical that, apart from extended discovery, MISC had anything to gain from the rule it advocated. Justice Scalia rebutted Ms. Higgins’s assertion that a district court might reconsider its forum non conveniens decision if it found that personal jurisdiction existed by pointing out that the decision to dismiss was made on the assumption that personal jurisdiction was proper. Finally, Justice Ginsburg asked why forum non conveniens should not be viewed as comprising aspects of both domestic venue transfer statutes, §§ 1404 and 1406; if it includes aspects of § 1406, the precedent of Goldlawr suggests that personal jurisdiction is unnecessary for the court to dispose of the case. While not responding to that question directly, Ms. Higgins took the opportunity to point out that §§ 1404 and 1406 support MISC’s argument that its desired rule would be limited, since it would apply only to cases where the alternative forum is a foreign country or a state court.