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Cal Supremes Resolve Important Conflict of Laws Issue

By Bruce Nye

    Cal Biz Lit blogged here on McCann v. Foster Wheeler (2008), ___Cal.Rptr.___, Superior Court of Los Angeles County; BC336869.  The case dealt with a conflict between Oklahoma?s pro-business statute of repose, which would bar the plaintiff?s claim, and Code of Civil Procedure section 340.2, California?s pro-plaintiff statute of limitations for asbestos claims, which would have allowed it.  Plaintiff was exposed to asbestos related to the defendant?s product for two weeks in the late 1950?s in Oklahoma.  The defendant was a resident of New York.  And the plaintiff moved to California in 1975, living here until his mesothelioma diagnosis more than thirty years later.

    California uses a three-part ?governmental interest? method for resolving conflicts. Reich v. Purcell (1967) 67 Cal.2d 551.  First, it looks at whether there is actually a conflict.  Second, it looks at whether both states have an interest in applying their own laws.  Finally, if there is a conflict and if both states have interests, it looks at which interest will be more significantly impaired  by application of the other?s law.

    The Court of Appeal had ruled that Oklahoma had no interest in protecting a New York defendant, so that California?s pro-plaintiff statute of limitations applied. 

    Yesterday, the Supremes reversed in McCann v. Foster Wheeler LLC (February 18, 2010) ___ Cal.___ (S162435).   The court held 7-0 that Oklahoma had an interest in business-friendly legislation both as applied to local businesses and to out-of-state businesses.  Furthermore, the interest in creating a more business-friendly environment in Oklahoma would be more severely impaired by applying California law than would California?s pro-plaintiff interest be impaired by applying the Oklahoma bar.

    It is not unusual for non-California plaintiffs to sue non-California defendants in toxic tort cases where the primary nexus between the case and California is that the plaintiff?s attorneys are located here.  CBL can imagine a number of situations where this sort of conflict of laws arises, and the McCann decision could well apply to any number of situations involving toxic exposures in plaintiff-unfriendly jurisdictions.

Full post as published by CalBizLit on February 19, 2010 (boomark / email).