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By Michael Greene
April 6 — The Delaware Supreme Court April 6 held that Mexican law, not Texas law, should govern a product liability dispute between Bell Helicopter Textron Inc. and representatives of the victims of a helicopter crash.
Writing for the majority, Delaware Supreme Court Chief Justice Leo E. Strine Jr. ruled in favor of Bell in its interlocutory appeal “[b]ecause the governing Restatement test to determine which sovereign's law to apply strongly favors Mexico.” The decision reverses a superior court order determining that the law of Texas, where an alleged defective strap fitting was manufactured, should apply to the dispute.
At the outset of the opinion, the court noted that neither of the parties contended that Delaware law should apply to the dispute and that the only connection to the forum is that Bell is a Delaware corporation.
Accordingly, the court determined that under the Restatement, deference should be shown to the sovereign state with the “most significant” relationship to the litigation.
Applying the four contacts set forth in the Restatement (Second) of Conflict of Laws §145(2), the court found that Texas did not have more significant relationship to the injury and parties than Mexico. In doing so, the court rejected the superior court's determination that the helicopter crash “fortuitously occurred” in Mexico. Instead, the court wrote that because all of the victims lived and worked there, “they did not ‘fortuitously' happen to be in Mexico.”
The court additionally found that the Restatement §6 principles also favored applying Mexican law.
Of note, Strine found that the first of the six principles, “the needs of the interstate and international systems,” strongly favor the application of Mexican law.
“Providing incentives for Mexican citizens to evade the limits on remedies and damages imposed by their own legal system when the defendant fortuitously happens to be a U.S.-based company threatens to disturb international relations and to impede the willingness of companies to do business in Mexico.,” he wrote.
In a dissenting opinion, Justice James T. Vaughn Jr., who was confirmed in October, opined that he believed that the plaintiffs “successfully rebutted the presumption that Mexican law applies to the substantive issues of this case.” Justice Vaughn disagreed with the majority that the policies of Mexico may be undermined if Texas law was applied. Accordingly, he agreed with the superior court's evaluation of the Restatement factors.
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The opinion is available at http://www.bloomberglaw.com/public/document/Bell_Helicopter_Textron_Inc_v_Arteaga_No_333_2015_BL_96809_Del_Ap.
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