2005 | Cited 0 times | D. Massachusetts | December 8, 2005


Plaintiff Travelers Indemnity Company of Illinois filed suit asa subrogee of Patco Corporation ("Patco") against defendantWolverine (Massachusetts) Corporation regarding the malfunctionof a thermal oxidizer sold by defendant to Patco pursuant to asales agreement. Of the Complaint's original three countsalleging negligence, strict liability and breach of impliedwarranties of merchantability and fitness, only Count 1 remains.The question of negligence regards defendant's installation ofand start-up assistance for the thermal oxidizer in addition tofailure to warn of any dangers after providing such services.Although the parties dispute whether defendant in fact installedplaintiff's thermal oxidizer, they agree that defendant providedstart-up assistance. Plaintiff contends that at least some of thethermal oxidizer problems resulted from faulty start-upassistance and now moves for the application of Rhode Island lawto the determination of comparative negligence. Defendant opposesand argues that Massachusetts law properly governs thecomparative negligence issue. "The question of which state's law applies is resolved usingthe choice of law analysis of the forum state — in this case,Massachusetts." Reicher v. Berkshire Life Ins. Co. of America,360 F.3d 1, 4 (1st Cir. 2004). When the issue involves acontractual dispute, "Massachusetts honors choice-of-lawprovisions in contracts." Northeast Data Sys., Inc. v. McDonnellDouglas Computer Sys. Co., 986 F.2d 607, 610 (1st Cir. 1993).Otherwise, Massachusetts' choice-of-law framework requiresconsideration of several factors in order to determine theappropriate forum state. See Reicher, 360 F.3d at 4-6.

Defendant argues, first, that the thermal oxidizer salesagreement governed the subsequent sale of start-up services,thereby placing disputes about start-up services within the scopeof the agreement's choice-of-law provision (which invokesMassachusetts law). (See Def.'s Mem. of Law in Opp. to Pl.'sMot. 8-11). Plaintiff, to the contrary, asserts that the sale ofstart-up services arose independently of the oxidizer salesagreement and that the correct state forum depends upon analysisunder the Massachusetts choice-of-law framework. Determiningwhether the oxidizer sales agreement included start-up servicesis unnecessary, however, because the choice-of-law frameworkfavors Massachusetts as the appropriate forum.

"The first step in a choice of law analysis is to determinewhether an actual conflict exists between the substantive laws ofthe interested jurisdictions, here, Massachusetts and [RhodeIsland]." Reicher, 360 F.3d at 4. Under Rhode Island law,plaintiff may recover for any portion of damages attributable todefendant, even if plaintiff is responsible for more than half ofthe malfunction. See R.I. Gen. Laws § 9-20-4. If Massachusetts law applies, as recommended by defendant, amodified comparative fault rule would bar any recovery ifplaintiff is more than 50% liable for the damages. See Mass.Gen. Laws ch. 231, § 85. Thus, finding that Patco was responsiblefor more than half of its own damages would bar all recovery byplaintiff under Massachusetts law, whereas Rhode Island wouldstill permit plaintiff to obtain compensation for the portion ofdamages attributable to defendant. Accordingly, an actualconflict exists between Massachusetts and Rhode Island laws onthe issue of comparative negligence.

Next, "Massachusetts courts consider a variety of factors" inorder to determine which state demonstrates more significantrelationship to the case. Reicher, 360 F.3d at 5. Plaintiffcites several factors in support of Rhode Island, includingPatco's place of incorporation, the location of the injury andprovision of start-up services, and the site where a majority ofthe business meetings between Patco and defendant occurred.(See Pl.'s Mem. of Law in Supp. of Its Mot. 10). Rhode Island'sinterest in protecting and compensating its businesses furtheradvocate for application of its laws. (Id. at 11). Althoughplaintiff argues that "values of certainty, predictability, anduniformity of result do not favor the application ofMassachusetts law," it relies upon circular reasoning in supportof this argument. (Id. at 12).

Factors that favor Massachusetts, on the other hand, includedefendant's place of incorporation and the forum for the instantlitigation as selected by plaintiff. (See Def.'s Mem. of Law inOpp. to Pl.'s Mot. 17). Additionally, defendant argues that Massachusetts' comparative negligence law operates, as intendedby public policy, as a "loss-allocating rule" to protect residentdefendants. (Id. at 14-15).

Determination of the appropriate state forum requires more than"simply adding up various contacts." Bushkin Assoc., Inc. v.Raytheon Co., 393 Mass. 622, 632 (1985). Instead, these shouldbe considered in light of the "choice-influencing factors listedin § 6(2) of the Restatement (Second) of Conflict of Laws." 634. Unfortunately, several of these factors "point clearlytoward neither State." Bushkin, 393 Mass. at 635. For example,the "relevant policies of the forum[s]" differ with respect tothe degree of protection they offer for defendants — greater inMassachusetts — as compared to the degree of relief offered forplaintiffs — greater in Rhode Island. Restatement (Second) ofConflicts § 6(2)(b). Yet, this difference does not favor oneforum over the other.

The factor concerning "the protection of justifiedexpectations" bears relevance, however. Id. at § 6(2)(d).Regardless of whether defendant succeeded in explicitlydesignating Massachusetts as the selected forum as a matter law,defendant clearly expected Massachusetts law to apply to all ofthe services it provided. (See Def.'s Mem. of Law in Opp. toPl.'s Mot. 8). Similarly, plaintiff expected that Massachusettslaw would apply at least to all matters within the scope of thatagreement and, even if the agreement does not cover start-upservices, plaintiff never said that it expected Rhode Island law,and not Massachusetts law, to govern provision of the start-upservices. Plaintiff contends, though, that defendant "act[ed]without giving thought to the legal consequences of [its] conductor to the law that may be applied," and thereby had "no justified expectations to protect." Restatement (Second)of Conflict of Laws § 6 cmt. g. However, the fact that defendantmay have acted negligently does not undermine the fact that itworked diligently to ensure a Massachusetts forum for anydisputes or litigation. "Generally speaking, it would be unfairand improper to hold a person liable under the local law of onestate when he had justifiably molded his conduct to conform tothe requirements of another state." Id. The facts that theinjury occurred in Rhode Island and that comparative negligencefavors the plaintiff under Rhode Island law do not outweighdefendant's and, to a lesser extent, plaintiff's demonstratedexpectations that Massachusetts law would apply to their courseof dealings.

Accordingly, plaintiff's motion to apply Rhode Island law (# onthe docket) is denied.

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