In re Union Carbide Corp. Gas Plant Disaster at Bhopal, India in December, 1984

Nos. 86-7517; -7589; -7637 (809 F.2d 195) (2d Cir. January 14, 1987)

ELR Digest

The court holds that the district court did not abuse its discretion by granting Union Carbide's motion to dismiss 145 consolidated personal injury actions arising out of the release of methyl isocyanate gas in December 1984 from Union Carbide's Bhopal plant on the grounds of forum non conveniens. Soon after the accident, the first of 145 class actions, involving approximately 200,000 plaintiffs, was filed in a federal district court. The complaints were consolidated in the Southern District of New York in June 1985. In the meantime, India enacted the Bhopal Gas Leak Disaster (Processing of Claims) Act in March 1985, granting the Union of India (UOI) the exclusive right to represent the victims. In April 1985, the UOI filed a complaint in the Southern District of New York on behalf of all victims of the accident. In May 1986, the district court dismissed the consolidated complaints on the grounds of forum non conveniens, subject to three conditions. The appellate court first determines that plaintiffs' choice of a United States forum is entitled to little or no deference, since all but a few of the 200,000 plaintiffs are Indian citizens who have replaced their American counsel with the UOI, which now wishes to proceed in Indian courts. The district court's finding that Indian courts provide a reasonably adequate alternative forum was not clearly erroneous. Plaintiffs' contention that the district court should retain jurisdiction because Union Carbide has its principal place of business in the United States is not persuasive, since Union Carbide has consented to Indian jurisdiction. Plaintiffs' assertion that the most probative evidence on negligence and causation is located in the United States is not supported by the record. The principal witnesses and documents are located almost entirely in India. The court rejects plaintiffs' argument that transfer of the cases to India will jeopardize a $350 million settlement being negotiated by plaintiffs' American counsel. The settlement has never been finalized and the UOI, which is itself a plaintiff in addition to representing the individual plaintiffs, is firmly opposed to the settlement.

The court holds that Union Carbide may seek appellate review of the conditions imposed by the district court on its forum non conveniens dismissal, since it expressly reserved its right to appeal and it has made a sufficient showing of prejudice from the second and third conditions. The court upholds the condition requiring Union Carbide to consent to the Indian court's personal jurisdiction over it and waive the statute of limitations as a defense. The court holds, however, that the district court erred in conditioning its dismissal on Union Carbide's consent to the enforceability in theUnited States of an Indian judgment. The district court erroneously assumed that absent this condition, plaintiffs might not be able to enforce an Indian judgment in the United States. The New York Foreign Country Money Judgments Law provides that a foreign country judgment will generally be recognized as conclusive between the parties, except in certain situations not applicable here. The court rejects Union Carbide's argument that the court should protect it against potential denials of due process by the Indian courts by authorizing the district court to monitor the Indian proceedings and rectify any abuses. The district court loses all further jurisdiction over the cases when it dismisses on the grounds of forum non conveniens. Any denial of due process by the Indian courts can be raised as a defense to any attempts to enforce an Indian judgment in United States courts. Further, the language of the district court's condition, which requires that the judgment "comport with minimal requirements of due process," may be misconstrued as providing for a lesser standard than American courts would otherwise require. The court holds that the district court also erred in requiring Union Carbide to consent to discovery by plaintiffs in accordance with the Federal Rules of Civil Procedure when Union Carbide is confined to the more limited discovery under Indian law. Basic justice requires that both sides have equal access to evidence.

The full text of this opinion is available from ELR (24 pp. $3.50, ELR Order No. C-1359).

Counsel for Plaintiffs-Appellants
F. Lee Bailey
66 Earldor Cir., P.O. Box 679, Marshfield MA 02050

Counsel for Defendant-Appellee
Bud G. Holman
Kelley, Drye & Warren
101 Park Ave., New York NY 10178
(212) 808-7800

Mansfield, J.

[OPINION OMITTED BY PUBLISHER IN ORIGINAL SOURCE]