Delta Air Lines, Inc. v. Chimet, S.p.A. (3d Cir. (Pa.) Aug. 30, 2010). Chimet, an Italian company with no U.S. offices, contracted with Delta in 2007 to transport over 100 kilograms of platinum (allegedly worth over US$4 million) from Italy to a consignee in Philadelphia, Pennsylvania. The platinum was stolen before delivery was made, allegedly in Philadelphia.
Under Article 22(3) of the Montreal Convention, Delta’s liability for the cargo loss would be limited to 19 Special Drawing Rights (currently equivalent to about US$30) per kilogram unless Chimet had declared a higher value. The parties’ dispute centered on whether Chimet had declared a higher value. In particular, the parties disagreed about the meaning of the entry “VAL VAL VAL VAL” on the air waybill and about certain other entries on that document and on the delivery receipt.
Delta filed an action in federal court in Pennsylvania seeking a declaratory judgment that its liability was limited pursuant to the Montreal Convention. Chimet moved to dismiss on forum non conveniens grounds, and the court granted the motion.
On appeal, Delta first argued that the trial court had abused its discretion by failing to give the required “considerable deference” to Delta’s choice of forum. The appeals court disagreed, holding that the trial court had given such deference by evaluating, and rejecting, Chimet’s arguments that Delta’s choice of forum deserved no deference.
Next, Delta argued that the trial court had abused its discretion in analyzing the Gulf Oil Corp. v. Gilbert forum non conveniens factors. In Gilbert, a 1947 case, the Supreme Court “provided a list of ‘private interest factors’ affecting the convenience of the litigants, and a list of ‘public interest factors’ affecting the convenience of the forum.”
As to the private interest factors, Delta contended that the dispute over whether Chimet had declared a higher value should be resolved by reference to the air waybill alone, and that consideration of other evidence, all of which (except for the delivery receipt) was located in Italy, was unnecessary. The appeals court disagreed, holding that the Montreal Convention does not preclude “consideration of extrinsic evidence to determine the terms of the contract of carriage.” The court further held that Chimet had met its burden of proving that testimony regarding this disputed issue could only be obtained from persons who resided in Italy, who were thus beyond the subpoena power of the U.S. courts. The court also held that an additional factor supporting Chimet’s argument was its “stated desire” to join certain Italian companies, which could not be joined in any U.S. litigation, as defendants in the case. Thus, the appeals court concluded that the private interest factors supported dismissal.
The appeals court came to the same conclusion regarding the public interest factors. It held that the “locus of the allegedly culpable conduct” was Italy, not Pennsylvania, because the parties’ dispute centered on whether Chimet had made a declaration of value when it delivered the cargo to Delta in Italy, and that “the circumstances under which the shipment of cargo was lost in Pennsylvania are not relevant to determining whether Delta’s liability is limited under the Montreal Convention.”