Douglas W. DAVIS et al., Plaintiffs and Appellants, v. SHILEY INCORPORATED et al., Defendants and Respondents.
This case involves the infamous artificial Convexo-Concave artificial heart valve developed, tested, manufactured and promoted by Shiley Incorporated in Irvine, California. After the Food and Drug Administration (FDA) granted Shiley approval to distribute the valves worldwide in 1979, medical providers soon discovered some of the valves contained a weak outlet strut mechanism which fractured in approximately one percent of its recipients, causing death or serious injury. (Michael v. Shiley, Inc. (3d Cir.1995) 46 F.3d 1316, 1319.) In 1986, Shiley recalled all its valves from the market and ceased production. Recipients were left to make the appalling choice of undergoing life-threatening heart valve replacement surgery or waiting to see whether their valve would withstand the test of time. Not surprisingly, a flood of litigation resulted.
In one such matter, we held a cause of action “does not presently exist under any theory premised on the risk the valve may malfunction in the future.” (Khan v. Shiley Inc. (1990) 217 Cal.App.3d 848, 857, 266 Cal.Rptr. 106, original italics [this includes claims of strict liability, negligence, breach of warranty and failure to warn].) But we determined a plaintiff could properly bring a fraud action. (Ibid.)
Here, we review the fraud claims of one Shiley valve recipient, Douglas Davis.1 The court granted Shiley's summary judgment motion, ruling Davis's lawsuit was time-barred by the applicable Oregon statute of repose. Finding the trial court improperly applied out-of-state law, we reverse and remand.2
summary of Facts
In 1983, Douglas Davis underwent valve implant surgery in Oregon, where he and his wife resided. Five years later, he filed a federal product liability and fraud lawsuit in Oregon against Shiley. His case ended in a summary judgment which was affirmed on appeal.
In 1994, Davis underwent open-heart surgery to explant the valve and replace it with a newer model. The surgery was performed in Oregon. One month later, he filed the underlying action in California. Davis alleged Shiley knowingly disseminated material misrepresentations to him, his physicians, and the general public about the valve's safety and propensity to fail. Specifically, he asserted, “ [Shiley] misrepresented the safety and efficacy of the [ ] valve in labeling, advertising, and promotional materials;  Knowing that its pre-marketing testing of the [ ] valve was inadequate, [Shiley] promoted and sold the [ ] valve but failed to provide adequate warnings to plaintiffs and the general public which fairly reflected the risks known to [Shiley]; ․  [Shiley] made understatements in reports of the [ ] valve strut fracture and failure rate when [Shiley] knew the predictable and reasonable probable rate was significantly higher;  [Shiley] disseminated false and misleading information in connection with recalls of the [ ] valve, which information was calculated to deceive the medical community, governmental agencies, plaintiffs and the general public about the true facts concerning the recall;  [Shiley] omitted material facts showing that the [ ] valve had a history of strut failure ․;  [Shiley] made false and misleading statements that there were modifications in the [ ] valve manufacturing process which allegedly eliminated the defects in the valve, when in fact, [Shiley] knew or reasonably should have known that [ ] valves manufactured under the new process contained the same defects.” Davis alleged Shiley “made these misrepresentations with the intention ․ the plaintiffs, [ ] physicians and the consuming public would rely on them in selecting the [ ] valve for use.” In addition, he claimed to have justifiably and detrimentally relied on the misrepresentations.
Shiley again moved for summary judgment claiming the lawsuit was time-barred by Oregon's statute of repose which required Davis to file his claim within eight years of the valve's purchase. Alternatively, Shiley claimed res judicata arising from Davis's first suit barred him from maintaining the second. Davis requested a continuance to obtain further discovery on the issues of fraud, misrepresentation and deceit as to the valve's safety. The court denied his motion and concluded Davis's claims were time-barred under Oregon law. Although it did not rule on Shiley's alternative argument, the court noted it did not believe res judicata applied in this case.3
statute of Limitations Choice of Law Analysis
Shiley devotes its entire brief to proving the trial court correctly applied Oregon's statute of repose. Its focus is misdirected because the statute applies to product liability actions. True, in his complaint Davis alleged several theories of recovery based on product liability law, i.e., strict liability in tort, negligence, and breach of express and implied warranties. But, as we have explained, only Davis's fraud claim is viable. (Khan v. Shiley Inc., supra, 217 Cal.App.3d at p. 855, 266 Cal.Rptr. 106 [plaintiff must have proof the product has malfunctioned to recover under any product liability theory].)
We therefore turn our focus to the determination of which state's fraud statute of limitations “most appropriately applies.” (Hurtado v. Superior Court (1974) 11 Cal.3d 574, 580, 114 Cal.Rptr. 106, 522 P.2d 666.) In making this decision we are required to follow the “governmental interest approach,” which “proceeds in three steps: (1) determination of whether [Oregon and California] ․ have different laws, (2) consideration of whether each of the states has an interest in having its law applied to the case, and (3) if the laws are different and each has an interest in having its law applied (a ‘true’ conflict), selection of which state's law to apply by determining which state's interests would be more impaired if its policy were subordinated to the policy of the other state. [Citations.]” (North American Asbestos Corp. v. Superior Court (1986) 180 Cal.App.3d 902, 905, 225 Cal.Rptr. 877.)
Do California and Oregon have different laws?
California and Oregon prescribe different time periods after the date of discovery in which a plaintiff must file a fraud claim. In California, a plaintiff has three years (Code Civ. Proc., § 338) while Oregon plaintiffs are limited to two. (ORS § 12.110(1).)
Does each state have an interest in having its law applied?
“A state will have an interest in having its law applied if the policies underlying the law would be thereby advanced. When only one of two potentially concerned states has an interest in having its law applied, the conflict of laws is said to be ‘false;’ the court simply applies the law of the only interested state. [Citations.]” (Ashland Chemical Co. v. Provence (1982) 129 Cal.App.3d 790, 794, 181 Cal.Rptr. 340, italics added.) This case presents a false conflict.
Ashland Chemical Co. v. Provence, supra, 129 Cal.App.3d 790, 181 Cal.Rptr. 340 is instructive. There, the parties disagreed over whether California's or Kentucky's statute of limitations applied in a guaranty contract cause of action. The court concluded, “California is the only interested state. Statutes of limitations are designed to protect the enacting state's residents and courts from the burdens associated with the prosecution of stale cases in which memories have faded and evidence has been lost. [Citation.] Here California courts and a California resident would be protected in applying California's statute of limitations because California is the forum and the defendant is a California resident. Applying California's statute of limitations would thus advance its underlying policy. In choice of law terms, California has an ‘interest’ in applying its law. In contrast, Kentucky has no interest in having its statute of limitations applied because here there are no Kentucky defendants and Kentucky is not the forum. This case ․ is ‘the very paradigm of the false conflict.’ [Citation.]” (Id. at p. 794, 181 Cal.Rptr. 340; see also American Bank of Commerce v. Corondoni (1985) 169 Cal.App.3d 368, 215 Cal.Rptr. 331 [California court found false conflict in dispute over whether California's or New Mexico's statute of limitations applied, holding New Mexico had no interest in applying its law in a dispute involving a California defendant].)
Similarly, this case presents a false conflict. California is the only state interested in applying its statute of limitations: California is the forum, and Shiley, the only defendant, is a California resident. Thus, application of California's limitations period serves its underlying policy to protect California residents and courts from stale claims. Conversely, Oregon has no interest in applying its law because there are no Oregon defendants and Oregon is not the forum.
We reject Shiley's contention that Oregon “has a strong interest in having its law applied here.” Relying on several Oregon cases, Shiley argues, “Oregon's statute of repose represents a policy decision as to the importance of putting limits on the prospect of litigation regarding products sold in Oregon.” (See, e.g., Johnson v. Star Machinery Co. (1974) 270 Or. 694, 530 P.2d 53, 56.) But Shiley forgets to mention the plaintiffs and defendants in those cases were Oregon residents. The courts were not faced with a choice of law dilemma and therefore did not address whether Oregon has an interest in aiding defendants residing out of state from stale claims raised in another state. The only relevant policy to be gleamed from those cases is states have a clear interest in protecting resident defendants from stale causes of action brought within the state. This mandate actually supports Davis's argument California, not Oregon, has an interest in applying its law here.
We are also unpersuaded by Shiley's attempt to minimize California's interest in applying its statute of limitations based on California's record of granting Shiley's forum non conveniens motions. (See, e.g., Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 1 Cal.Rptr.2d 556, 819 P.2d 14.) At oral argument Shiley tried to make this contention sound like a $1 million argument, but on review it turns out to be worth less than a nickel. “Forum non conveniens is an equitable doctrine” allowing 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. [Citation.]” (Id. at p. 751, 1 Cal.Rptr.2d 556, 819 P.2d 14.) The court considers whether “the alternate forum is a ‘suitable’ place for trial” and if so, evaluates “the private interests of the litigants and the interests of the public in retaining the action for trial in California [, including] ․ the ease of access of sources of proof, the cost of obtaining attendance of witnesses, ․ [the desire to avoid] overburdening local courts with congested calendars, [and] protecting the interests of potential jurors․” (Ibid.)
None of these factors are relevant in deciding whether California has an interest in applying its statute of limitations. Indeed, as delineated by the Supreme Court, the focus of this inquiry is limited to consideration of the policies underlying enactment of the limitations period. (Hurtado v. Superior Court, supra, 11 Cal.3d at pp. 580-581, 114 Cal.Rptr. 106, 522 P.2d 666.) We find no reason to require trial courts to also consider extraneous information regarding the suitability of the entire lawsuit.4
california's Borrowing Statute
Thus, we look to California law and specifically Code of Civil Procedure section 361 which provides, “When a cause of action has arisen in another State, or in a foreign country, and by the laws thereof an action thereon cannot there be maintained against a person by reason of the lapse of time, an action thereon shall not be maintained against him [or her] in this state․” (Italics added.) In other words, plaintiffs cannot maintain a lawsuit in California if their claims are time-barred in the state where the cause of action arose.
Davis's fraud claim arose in California and Oregon. The necessary elements of fraud are “(a) misrepresentation (false representation, concealment or nondisclosure); (b) knowledge of falsity [ ]; (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage. [Citations.]” (5 Witkin, Summary of Cal. Law (9th ed. 1988) Torts, § 676, p. 778.) Davis alleged Shiley knowingly and intentionally disseminated false information promoting its products from California, and Davis detrimentally relied upon these misrepresentations while residing in Oregon. Because Davis's action partially arose in California, the borrowing statute is inapplicable and California's three-year statute of limitations applies. (Code Civ. Proc., § 338.)
Nevertheless, we still cannot resolve whether Davis's action is timely. In moving for summary judgment, Shiley presented facts relevant only to the Oregon statute of repose, i.e., proof Davis purchased the valve in Oregon over eight years ago.5 There is no evidence in the record regarding when Davis discovered the alleged fraudulent misconduct. Thus, we remand the matter.6
The Berriers' appeal is dismissed. The judgment rendered in the Davis' lawsuit is reversed and the case remanded. The Davises shall recover their costs on appeal.
My colleagues, Justices Crosby and Sonenshine, took a serious wrong turn in part IV of Khan v. Shiley, Inc. (1990) 217 Cal.App.3d 848, 857-858, 266 Cal.Rptr. 106, when, after pages of well-reasoned analysis explaining why the plaintiffs had no products liability cause of action because of the absence of any actual defect in their heart valves, they concluded, almost as an afterthought, that a fraud claim was possible because that claim impugned the defendants' “conduct,” as distinct from the defendants' “product.” Said the Khan court: “A cause of action does not presently exist under any theory premised on the risk the valve may malfunction in the future. This includes negligence, i.e., failure to warn, and breach of warranty. Allegations of fraud, however, are in a class by themselves․ [¶] Unlike the other theories, in which the safety and efficacy of the product is assailed, the fraud claim impugns defendants' conduct.” (Id. at p. 857, 266 Cal.Rptr. 106, footnote omitted, original emphasis.)
The distinction between “conduct” and “product” is not convincing in the context of Shiley's marketing of its heart valve. The nature of the alleged fraud-essentially, omitting data showing a certain level of risk of failure-is itself so intertwined with the design and manufacture of the product that it is, in substance, a products liability claim, because it is still premised, as my colleagues correctly perceived about negligence and warranty claims, on (as they said in Khan ) the “risk the valve may malfunction in the future.” Permitting a fraud claim to go forward based on conduct regarding the risk of malfunction is merely a circumvention of the well established rule in products liability law that there is no liability where there is no malfunction. (See Khan, supra, 217 Cal.App.3d at p. 855, 266 Cal.Rptr. 106.) 1
That said, the fact remains that even if we accept-indeed, especially if we accept-the rationale in Khan, Davis' present claim for fraud is necessarily precluded under the doctrine of res judicata. Ironically enough, one of the many cases which have recognized that fraud claims arising out of the marketing of Shiley's heart valve are really, in substance, products liability claims is Pryor v. Shiley, Inc. (9th Cir.1990) 916 F.2d 716, 1990 WL 159582,2 in which the plaintiff in the case now before us, Douglas Davis, was also one of the losing plaintiffs. Davis asserted a misrepresentation claim there too, but it was rejected for what it really was: a nonviable products liability claim in disguise. The federal appellate court said: “The misrepresentation causes of action were properly dismissed also. Oregon treats all product liability actions the same, regardless of the theory asserted. Plaintiffs cannot avoid the physical harm requirement by recasting their failure to warn claims as misrepresentation claims.” (1990 WL 159582 at p. 2.) In short, Davis has already litigated in federal court Shiley's conduct in allegedly making misrepresentations in the course of marketing its heart valve. He lost.
It is true that since the Pryor decision was handed down Davis has undergone surgery to remove the device, a fact that makes a difference in some jurisdictions. The Third Circuit for example, in construing Pennsylvania law, has concluded that the fact of removal or “ explantation” surgery provides the necessary element of physical injury. (Compare Angus v. Shiley, Inc. (3d Cir.1993) 989 F.2d 142, 147 [no viable claim because there was no direct physical injury in case where there was no malfunction and no removal surgery] with Michael v. Shiley, Inc. (3d Cir. 1995) 46 F.3d 1316, 1332-1333 [viable claim because of explantation surgery].)
What my colleagues fail to appreciate, however, is that inherent in the rationale of Khan (as much as I disagree with it) is the idea that the presence or lack of physical injury makes no difference to a fraud claim. Remember: they concluded that fraud was in a “class by itself” in Khan because the claim did not impugn Shiley's product, only its conduct. (Khan, supra, 217 Cal.App.3d at p. 857, 266 Cal.Rptr. 106.) Yet if only Shiley's “conduct” is impugned by Davis' fraud claim, then it makes no difference whether or not he underwent explantation surgery-the surgery only goes to whether he incurred some physical injury, which would only be relevant if physical injury was a requisite for his fraud claim. And, as my colleagues concluded in Khan, physical injury is not a requisite for assertion of a fraud claim.
That is the essential self-contraction of my colleagues' analysis and why the judgment must be affirmed: If Davis really has a viable fraud claim, separate from his product liability claims, then that fraud claim was finally decided in 1990 by the Ninth Circuit when it decided Pryor. To the degree that his explantation surgery has any legal relevance, it can only be because it supplies a necessary element-physical injury-previously missing from his product liability claim, not his fraud claim. And in that regard, if the fact of explantation surgery makes his product liability claim viable, then it must necessarily be precluded-as the majority opinion impliedly recognizes-as barred by Oregon's statute of repose. Either way, the trial court was correct in entering judgment for Shiley.
Even assuming that Davis' claim were not barred by res judicata, I would be required to dissent because I cannot agree with the majority's analysis of the statute of limitations problem. Essentially, in weighing the respective interests of the states,3 they ignore California's interest in protecting its businesses and taxpaying employers from competitive disadvantage. (See Howe v. Diversified Builders, Inc. (1968) 262 Cal.App.2d 741, 747, 69 Cal.Rptr. 56; cf. also Stangvik v. Shiley, Inc. (1991) 54 Cal.3d 744, 760, 1 Cal.Rptr.2d 556, 819 P.2d 14.)
Consider the sheer anomalousness of the result proffered by the majority opinion: They give an out-of-state plaintiff the right to sue an in-state employer under a theory wholly unavailable to the out-of-state plaintiff in his home state, and then, on top of that, give the out-of-state plaintiff the benefit of our state's more liberal statute of limitations on fraud claims. And this is a result that is supposed to reflect the product of a balancing process in which our state's respective interests are taken into account! As far as I can tell, the majority have simply gone out of their way to ensure that California gets the short end of the stick.
Howe v. Diversified Builders, Inc., supra, 262 Cal.App.2d 741, 69 Cal.Rptr. 56 is on point and directly contrary to today's result. In Howe, a Nevada subcontractor was injured in Nevada working on a project for California general contractors. Under Nevada law, he was deemed, as a subcontractor, an employee of the general contractors and limited to workers' compensation and therefore could not seek more generous tort damages. Under the more liberal California law, a subcontractor was not considered an employee and could seek tort damages. Naturally, he, like Davis here, wanted to sue under the more liberal California law.
The trial court, however, in balancing the respective interests of the states, applied Nevada law and granted summary judgment for the California defendants. The appellate court affirmed.
In affirming, the appellate court was plain: “California has no interest in extending to Nevada residents greater rights than are afforded them by the state of their domicile.” (Howe, supra, 262 Cal.App.2d at pp. 745-746, 69 Cal.Rptr. 56, emphasis added.) Indeed, the court repeated the point in the opinion, ruling that the trial court “properly adopted Nevada law because California has no interest in the subject matter of the action which would warrant its extending to Nevada residents rights to which they are not entitled by the state of their domicile.” (Id. at p. 747, 69 Cal.Rptr. 56.) To do so, the court said, “would discriminate invidiously against California employers engaged in business in Nevada.” (Ibid.) The court added that it was Nevada, not California, which would shoulder the “economic burdens” attendant upon any incapacity. (Id. at p. 746, 69 Cal.Rptr. 56.)
Invidiously discriminating against California business is precisely what the majority do today: They extend to an Oregon resident a right that resident does not have in his home state, give him the benefit of the more liberal statute of limitations in this state to boot, and, to add insult to injury to the taxpayers of this state, give him the right to proceed even where he has already litigated the identical claim in his home state. It is hard to fathom how a court of this state could contrive a worse result against a California employer.
It might be objected, of course, that Howe only involved disparities in substantive rights in the context of a workers' compensation scheme, while the present case involves differences in the statute of limitations, and that somehow policy considerations like competitive disadvantage are not appropriate when balancing the respective state interests in the context of differences in the statute of limitations. Thus the majority limit their balancing of the respective state interests here to only the narrowly defined policy of protection against stale claims and, further, assume that California's interest is in necessarily applying its own statute. That assumption is both unexamined and simplistic. A state's interest is not necessarily in always applying its own law.
The majority's logic makes no sense, for three reasons. In the first place, it fails on its own premises. For the sake of argument let us assume that the majority is correct and the focus is limited to consideration of the policy of protecting California residents against stale claims. How, pray tell, is that policy advanced by preferring a more liberal statute of limitations over a more restrictive one? The simple answer is that it is not. Even if California's interest is only limited to protecting its citizens against stale claims, its interest is necessarily in applying Oregon's more restrictive statute.
Second, and more to the point, the interests of the two states in the context of a choice between respective statutes of limitations have been grossly oversimplified by the majority. A statute of limitations not only serves to preclude “stale” claims, it functions as a gross claims limitation mechanism, essentially winnowing out the total number of claims which a state's courts must process. (Cf. Hurtado v. Superior Court (1974) 11 Cal.3d 574, 581, 114 Cal.Rptr. 106, 522 P.2d 666 [caps on damages reflect policy of state to protect its residents from excessive financial burdens].) The “interest” of a state is therefore advanced when application of its statute of limitations precludes claims against its citizens by out-of-state plaintiffs, though that would not apply if one of its own residents were suing an out-of-state defendant.
Third, there is no reason to exclude broader public policy factors-such as the effect of the choice on the relative competitiveness of a state's employers-from consideration even in statute of limitations choice of law cases. As mentioned above, statutes of limitations are gross claim preclusion devices, and therefore in balancing the respective “governmental interests” courts should be able to take their effect, as such, into account.
Finally, even assuming that res judicata did not apply, and further assuming that the balancing of the respective state interests on the differing statutes of limitations required application of California's more liberal statute, I would still be compelled to write separately to state that the broad policy factor regarding this state's competitiveness should still be considered, albeit then in the context of a forum non conveniens motion.
A few years ago, in Prince v. Urban (1996) 49 Cal.App.4th 1056, 57 Cal.Rptr.2d 181, Justice Crosby wrote a thoughtful dissent in which he advanced the proposition that public policy concerns are properly suited for forum non conveniens motions rather than, say, jurisdictional ones. (See Prince, supra, 49 Cal.App.4th at p. 1067, 57 Cal.Rptr.2d 181 (dis. opn. of Crosby, J.).) Assuming that his position there is well taken, it would follow that such matters as the comparative disadvantage to California's businesses here would be properly taken into account in a forum non conveniens motion.4 After all, if public policy considerations in regard to the respective governmental interests cannot be taken into consideration when the issue is the choice of which state's statute of limitations applies, such considerations must be taken into consideration some time, and that would be in a forum non conveniens motion. While application in that context is not the analysis I favor (as made clear above), the parties should still be reminded that at least one member of this panel is not totally blind to the real interests of the state.
The trial court did the right thing, and its judgment should be affirmed.
1. Davis's lawsuit was consolidated with many others at the trial court level. Two other similarly-situated plaintiffs, Tommy Berrier and Joanne Marie Berrier, were also parties to this appeal but notified us after oral argument they had settled their cases. Accordingly, we dismiss their appeals.
2. We note Pamela J. Davis alleged loss of consortium. Having found her husband may state a fraud claim, we also reverse the summary judgments entered against her.
3. Contrary to the dissent's opinion, this tentative ruling was correct. In his first lawsuit, Davis stipulated he had not suffered any physical injury. For this reason, the court granted Shiley's motion for summary judgment, ruling physical harm was required in order to state a claim for negligence or strict product liability. Because the court characterized Davis's misrepresentation claim as simply a reallegation of products liability, it held the claim was also barred as a matter of law. This ruling was upheld on appeal: “The misrepresentation causes of action were properly dismissed [ ]. Oregon treats all product liability actions the same, regardless of the theory asserted. Plaintiffs cannot avoid the physical harm requirements by recasting their failure to warn claims as misrepresentation claims.” (Pryor v. Shiley, Inc. (9th Cir.1990) 916 F.2d 716, 1990 WL 159582 [nonpub. opn.].)Following the rational of Pryor, Justice Sills maintains Davis's fraud allegations involve the same elements as product liability causes of action. He argues those types of claims were completely resolved in Pryor, and therefore barred by the doctrine of res judicata. Not so. As we stated in Khan, “ “[Although a] cause of action does not presently exist under any theory premised on the risk the valve may malfunction in the future ․ [a]llegations of fraud ․ are in a class by themselves. [¶] For purposes of fraud, it matters not that the valve implanted ․ is still functioning, arguably as intended. Unlike ․ other theories, in which the safety and efficacy of the product is assailed, the fraud claim impugns defendants' conduct.” (Khan v. Shiley Inc., supra, 217 Cal.App.3d at p. 857, 266 Cal.Rptr. 106, italics added and footnotes omitted.) The court in Pryor lumped Davis's fraud allegations with his other causes of action attacking the nature of Shiley's products. The court did not recognize fraud as a distinct cause of action addressing Shiley's conduct. Accordingly, the principles of res judicata are not invoked. (See generally 7 Witkin (4th ed. 1997) Res Judicata, §§ 280 & 281, pp. 820-821.)Moreover, we are puzzled by Justice Sills's lengthy discussion of Davis's valve replacement. Although the surgical procedure occurred after the Pryor decision was filed, it is irrelevant to res judicata. As our colleague acknowledges in his dissent, “[P]hysical injury is not a requisite for assertion of a fraud claim[;]” it relates only to product liability causes of action. (Dis. opn. p. 833, original italics.)
4. Our dissenting colleague acknowledges the governmental interest approach to choice-of-law questions. This concession is however buried in a footnote. No wonder, he ignores this precedent, instead focusing on factors related to motions for forum non conveniens. Specifically, Justice Sills adds to the choice of law equation broad public policy concerns about protecting taxpaying employers from economic burdens and competitive disadvantages. But as we discussed in our opinion, supra, the law clearly delineates that what courts are to rely upon when making choice of law determinations. Justice Sills's points are not included.Not only does the dissenting opinion deviate from well-established law, its acceptance would create a onerous standard. Indeed, we find no reason to convert the conflict-of-law question from a relatively uncomplicated evaluation of the policies underlying enactment of the law into a formless and limitless review of each state's latest public policies.In addition, our disgruntled colleague offers what amounts to an advisory opinion on the merits and pitfalls of forum non conveniens motions. (See dis. opn. pp. 834-835.) We decline the temptation to join him on his soapbox.
5. Davis also alleges: (1) his participation in a class-action suit against Shiley tolled the Oregon statute of repose and (2) the court erroneously denied his continuance request. Based on our ruling, we need not discuss these contentions.
6. Before oral argument, Shiley submitted a letter to the court citing several recent federal cases. First, it invited our attention to Hilburn v. General Motors Corp. (E.D.Mich.1997) 958 F.Supp. 318, 320 where the court decided whether Michigan's or North Carolina's statute of repose applied in an automobile product liability case. Although the court underwent a choice of law analysis, the case is inapt because it did not employ the “governmental interest approach.” Indeed, the court failed to consider the legislative intent behind the conflicting laws of each state.Second, Shiley's authority noting a plaintiff's class-action participation does not toll a personal injury claim is inapt here. As explained, based on our ruling we need not resolve Davis's claims regarding tolling.Finally, Shiley enclosed a copy of a recent order issued by the United States District Court in Vestal v. Shiley Inc. (C.D.Cal. Nov. 17, 1997) Civ 96-1205-GLT(EEX) (nonpub.opn.). The court determined North Carolina's statute of repose, rather than California's statute of limitations, should apply in plaintiff's product liability action. We are not bound by the federal court's opinion (9 Witkin, Cal. Procedure (4th ed.1997) Appeal, § 942 & 943, pp. 983-984) and find its reasoning faulty. The court determined a true conflict existed because each state had an interest in applying its law. Relying on Stangvik v. Shiley Inc., supra, 54 Cal.3d 744, 1 Cal.Rptr.2d 556, 819 P.2d 14, it stated, “California's only interest is in deterring unlawful conduct by California companies.” (Vestal v. Shiley Inc., supra, typed opn. p. 6.) Whereas, North Carolina enacted the statute of repose to shield manufacturers from “ ‘open ended liability.’ ” (Id. at p. 5, citing Tetterton v. Long Mfg. Co. (N.C.1985) [314 N.C. 44] 332 S.E.2d 67, 73.) This analysis fails for several reasons. First, California's interest in applying its statute of limitations cannot be defined in the context of factors relevant to forum non conveniens motions. Indeed, the court in Stangvik only addressed the merits of defendant's forum non conveniens motion and is therefore inapt. The court overlooks the clear policy, underlying California's statute of limitations, to protect its resident defendants and courts from stale claims. Although the district court recognized North Carolina also has such a policy underlying its statute of repose, it failed to offer any reason why the legislature would extend such protection to out-of-state defendants.
1. I'm not too lonely on this soapbox. As one federal district court has noted, “In cases where the Shiley heart valve has not fractured, at least twenty-seven courts have granted summary judgment to the Defendants on the ground that a plaintiff may not recover for her fear or anxiety that a heart valve may fracture in the future.” (Bowling v. Pfizer, Inc. (S.D.Ohio 1992) 143 F.R.D. 141, 147.) Indeed, it would seem that the circumvention of established products liability law represented by the Khan-fraud theory has met with virtually universal rejection.
2. Pryor is an unpublished opinion; the citation is to a table in the reporter. A copy of the actual opinion is available from Westlaw. The opinion may be cited and quoted here because it is relevant to the present case under the doctrine of res judicata. (See Cal. Rules of Court, rule 977(b)(1).)
3. The traditional view of choice of law was that the forum state would enforce the substantive law properly applicable, even if it was not that of the forum state, but would necessarily apply its own procedural law, including the statute of limitations of the forum state. (E.g., Biewend v. Biewend (1941) 17 Cal.2d 108, 114, 109 P.2d 701.) The analysis was changed in 1967 when the Supreme Court handed down Reich v. Purcell (1967) 67 Cal.2d 551, 63 Cal.Rptr. 31, 432 P.2d 727. The new analysis departs from the mechanistic prior rule: Now the court must conduct “an analysis of the respective interests of the states involved.” (See Hurtado v. Superior Court (1974) 11 Cal.3d 574, 579, 114 Cal.Rptr. 106, 522 P.2d 666.)
4. It is a staple of forum non conveniens that the other forum must be available to the plaintiff, i.e., the defendant must be subject to the jurisdiction of the alternative forum. In that regard it is sometimes said that a forum non conveniens motion will fail if the plaintiff's cause of action “would elsewhere be barred by the statute of limitations.” (Stangvik v. Shiley, Inc. (1991) 54 Cal.3d 744, 752, 1 Cal.Rptr.2d 556, 819 P.2d 14.) With respect, I think the formulation needs to be refined a little. Stangvik cited a Judicial Council comment to section 410.30 of the Code of Civil Procedure which stated that a “suit will be entertained, no matter how inappropriate the forum may be, if ․ [t]he plaintiff's cause of action would elsewhere be barred by the statute of limitations, unless the court is willing to accept the defendant's stipulation that he will not raise this defense in the second state․” (Id. at p. 752, 1 Cal.Rptr.2d 556, 819 P.2d 14, quoting Judicial Council com., 14 West's Ann.Code Civ. Proc. (1973 ed.) § 410.30, pp. 492-493.)The Judicial Council comment cited three cases in support of its formulation, Vargas v. A.H. Bull Steamship Co. (1957) 44 N.J.Super. 536, 131 A.2d 39, Aetna Insurance Company v. Creole Petroleum Corporation (N.Y.App.Div.1966) 27 A.D.2d 518, 275 N.Y.S.2d 274, and Wendel v. Hoffman (N.Y.App.Div.1940) 259 A.D. 917, 18 N.Y.S.2d 96. If one examines these three cases, however, one does not find authority for a blanket rule against granting forum non conveniens motion when the forum state's statute of limitations would result in the loss of the case. The latter two cases from New York were short memorandum opinions merely noting that motions were being granted in light of the defendant's willingness not to plead the statute of limitations as a defense; Vargas is a tour de force in which the court noted that forum non conveniens motions turn ultimately on such considerations as “the ends of justice,” (Vargas, supra, 131 A.2d at p. 43), noted that “[t]here are no immutable boundaries confining the doctrine,” (ibid.), and, most importantly, noted the appropriateness of conditioning the granting of a forum non conveniens motion on “an effective waiver of any advantages the delay might otherwise afford” the defendant. (Id. at p. 45.)In the light of Vargas' recognition that it is the delay occasioned by the plaintiff's initial choice of forum and not any special solicitude that plaintiff should win which requires the waiver, a more precise formulation of the role that the statute of limitations plays in forum non conveniens motions would be this: A forum non conveniens motion will not be granted unless the defendant is willing to waive whatever advantage he or she will have accrued by virtue of the delay occasioned by the fact that the plaintiff first chose to file the action in the forum.Any other formulation encourages, as the facts in the present case well illustrate, forum shopping for the sake of circumvention of a home state's statute of limitations.
SONENSHINE, Associate Justice.
CROSBY, J., concurs.