Simon v. United States ( 2003 )

Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
8-20-2003
Simon v. USA
Precedential or Non-Precedential: Precedential
Docket No. 02-2945P
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PRECEDENTIAL
Filed August 20, 2003
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 02-2945
LOUIS SIMON; HOWARD ASHER;
HENRY F. MILLER; SUZANNE PETERSON,
EXECUTORS OF THE ESTATE
OF B. KENIN HART, DECEASED,*
Appellant
v.
UNITED STATES OF AMERICA
*(Amended in accordance with Clerk’s Order
dated 8/27/02)
(D.C. Civil No. 01-cv-05671)
Nos. 02-3996, 02-3997
MARY SCHALLIOL, AS PERSONAL
REPRESENTATIVE OF THE ESTATE
OF DENNIS SCHALLIOL, DECEASED
v.
JOHN FARE, JR., AS PERSONAL
REPRESENTATIVE OF THE ESTATE
OF JOHN FARE;
HART DELAWARE CORPORATION;
UNITED STATES OF AMERICA
2
Mary Schalliol,
Appellant in 02-3996
John Fare, Jr.,
Appellant in 02-3997
(D.C. Civil No. 01-cv-00224)
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
District Judge: Honorable Marvin Katz
Argued June 23, 2003
Before: SLOVITER, AMBRO, and BECKER, Circuit Judges
(Filed: August 20, 2003)
ARTHUR G. RAYNES, ESQ.
STEPHEN E. RAYNES, ESQ.
Raynes, McCarty, Binder,
Ross & Mundy
1845 Walnut Street, Suite 2000
Philadelphia, PA 19103
AARON S. PODHURST
JOEL S. PERWIN (Argued)
MICHAEL OLIN
Podhurst, Orseck, Josefsberg, Eaton,
Meadow, Olin & Perwin, P.A.
25 West Fagler Street, Suite 800
Miami, FL 33130
Attorneys for Appellants Louis Simon,
Howard Asher, Henry F. Miller, and
Suzanne Peterson, Executors of the
Estate of B. Kenin Hart, Deceased
in 02-2945
3
ROBERT D. McCALLUM, JR.
Assistant Attorney General
JEFFREY S. BUCHOLTZ
Deputy Assistant Attorney General
PATRICK L. MEEHAN
United States Attorney
TERENCE M. HEALY
VICTOR M. LAWRENCE
RODNEY PATTON (Argued)
Trial Attorneys
Torts Branch, Civil Division
U.S. Department of Justice
P.O. Box 14271
Washington, D.C. 20044-4271
Attorney for Appellee United States
HARRY A. WILSON, JR. (Argued)
D. BRUCE KEHOE
Wilson Kehoe and Winingham
2859 North Meridian Street
P.O. Box 1317
Indianapolis, IN 46206-1317
DANIEL S. WEINSTOCK
Feidman Shepherd Wohlgelernter
Tanner
25th Floor
1845 Walnut Street
Philadelphia, PA 19103
Attorneys for Appellant Mary
Schalliol in 02-3996
J. ARTHUR MOZLEY (Argued)
Mozley, Finlayson & Loggins, LLP
5605 Glenridge Drive
Suite 900
Atlanta, GA 30342-1380
Attorney for Appellee
Hart Corporation/Delaware Division
in 02-3996 & 02-3997
4
JOSEPH M. LAMONACA
Suite 303
Route 202 & 1
G & M Building
Chadds Ford, PA 19317
Attorney for John Fare, Jr.,
Appellee in 02-3996 & Appellant in
02-3997
OPINION OF THE COURT
BECKER, Circuit Judge.
The threshold question presented by this interlocutory
appeal, 28 U.S.C. § 1292(b), is whether Indiana’s or
Pennsylvania’s choice-of-law rules govern a suit against the
United States by the estates of passengers killed in the
crash of a small private aircraft. Two of the decedents lived
in Pennsylvania, another worked in Pennsylvania, the plane
was hangared in Pennsylvania, and the corporation that
owned it was incorporated in Pennsylvania. The plane
crash, which occurred during a landing at a Kentucky
airport in inclement weather, resulted from: (1) the
Government’s publication in Washington, D.C. of a chart
incorrectly showing that a long-inactive instrument landing
approach at the airport was active; and (2) the negligence of
Indiana-based federal air traffic controllers in relying on
that chart, in neglecting to monitor the radar during the
flight’s landing approach, and in failing to respond to the
pilot’s last-minute radio communications.
In a multistate tort action, the Federal Tort Claims Act
(“FTCA”) requires a federal court to apply the whole law of
the place where the acts of negligence occurred, including
its choice-of-law rules. 28 U.S.C. §§ 1346(b), 2674; Richards
v. United States, 369 U.S. 1 (1962). In a pretrial ruling, the
District Court determined that because acts of negligence
were committed in both Indiana and the District of
Columbia (“D.C.”), those jurisdictions’ choice-of-law rules
were candidates to govern the case. In order to determine
whether it was necessary to choose between the two, the
5
Court first had to determine whether there was a true
conflict between their choice-of-law rules. It concluded that
there was a true conflict because, unlike the District of
Columbia, Indiana law does not recognize the doctrine of
depeçage, i.e., conducting separate choice-of-law analyses
for different issues within a single theory of recovery, such
as liability and damages. To determine which jurisdiction’s
rules applied, the District Court employed the methodology
set forth in Gould Electronics, Inc. v. United States, 220 F.3d
169 (3d Cir. 2000), where we described five different
approaches to choice-of-law conflicts. Concluding that
these factors on balance favored Indiana, the District Court
utilized Indiana’s choice-of-law rules to determine whether
to apply Indiana’s or Pennsylvania’s substantive law.
Turning to the question whether Indiana’s choice-of-law
rules would apply Pennsylvania or Indiana’s substantive
law to the case (no party urged the application of D.C. or
Kentucky substantive law), the District Court first
determined that there was a true conflict between the two
jurisdictions’ damages regimes, as Pennsylvania’s damages
law (urged by Plaintiffs) allows for more generous
compensation of tort victims than Indiana’s (urged by the
Government). The Court concluded that the Indiana
Supreme Court would choose Indiana substantive law over
that of Pennsylvania. Reasoning that the choice-of-law
issue would likely be outcome determinative, however, the
Court certified the choice-of-law question to us under 28
U.S.C. § 1292(b). The papers are not entirely precise, but it
is clear from their tenor that the District Court decided
both choice-of-law issues and that they have been
presented by this appeal.
We are unsure about the correctness of the District
Court’s threshold ruling — that a true conflict exists
between Indiana and D.C.’s choice-of-law rules. Because
the Indiana Supreme Court has not addressed the question
whether Indiana courts may apply depeçage, we will vacate
the District Court’s conclusion that the Indiana Supreme
Court would not permit them to do so, and certify that
question to the Indiana Supreme Court itself pursuant to
Rule 64 of the Indiana Rules of Appellate Procedure.1 In the
1. We are not constrained by the final judgment rule since this is an
interlocutory appeal.
6
ordinary case, that would be sufficient for now. But if the
Indiana Supreme Court holds that Indiana does not
recognize depeçage, meaning that there is a true conflict
between Indiana and D.C. law, we will then be obliged to
decide which jurisdiction’s choice-of-law rules to apply, and
if we choose Indiana, another question looms — whether
Indiana would apply its own substantive law or
Pennsylvania’s to the case.2 This is an extremely difficult
question, and we are doubtful of the correctness of the
District Court’s resolution of the issue. Evaluating the
Indiana three-pronged test for determining which state’s
law it would apply would seem to result in a “tie” between
two factors, the third being largely neutral. This question
too would therefore benefit from a determination by the
Indiana Supreme Court as to how it would apply the factors
and break the tie.
While logically we might make the initial certification to
the Indiana Supreme Court and await its results (which
might or might not render it necessary for us to proceed
further), we are reluctant to risk the necessity of a second
certification to the Indiana high court, especially in view of
2. It is possible that Indiana’s and D.C.’s choice-of-law rules might
conflict even if Indiana embraces depeçage, for Indiana has adopted a
modified lex loci delicti test, which looks first to the place where the tort
occurred, which is Kentucky in this case. Since Kentucky bears little
relation to the action, however, Indiana’s lex loci test examines: (1) the
place where the conduct causing the injury occurred; (2) the residence
and place of incorporation and place of business of the parties; and (3)
the place where the parties’ relationship is centered. Hubbard, 515
N.E.2d at 1073. In contrast, D.C. employs a government interest test,
under which government interest is determined by considering: (1) the
place where the conduct causing the injury occurred; (2) the place where
the conduct causing the injury occurred; (3) the domicile, residence,
place of incorporation and place of business of the parties; and (4) the
place where the relationship is centered. Raflo v. U.S., 157 F. Supp. 2d
1, 5 (D.C. Cir. 2001).
Viewing the modified lex loci and government interests tests as whole,
however, we do not discern a meaningful difference between them under
the facts of this case. We therefore conclude that the existence of a true
conflict between Indiana’s and D.C.’s choice-of-law rules turns on
whether Indiana employs depeçage.
7
the fact that this case was fully ready for a four-week trial
when the District Court made its § 1292(b) certification.
Avoiding the spectre of a two-step certification requires
that we assume that Indiana may decide that it does not
recognize depeçage, in which case: (1) there will be a true
conflict between Indiana and D.C. choice-of-law principles;
and (2) this Court will have to decide which applies. To do
this, we must clarify our reasoning in Gould Electronics
since that opinion did not establish a general rule. We
synthesize the Gould approaches into a single inquiry that
chooses the rules of the jurisdiction containing the last
significant negligent act or omission relevant to the FTCA.
Since we conclude that the air traffic controllers in Indiana
committed the last significant act, we will apply Indiana’s
choice-of-law rules. As noted above, under the Indiana
Supreme Court’s three-part choice-of-law test set forth in
Hubbard Manufacturing Co., Inc. v. Greeson, 515 N.E.2d
1071, 1073 (Ind. 1987), one factor is indeterminate, one
favors Indiana substantive law, and one favors
Pennsylvania substantive law. Since Hubbard gives no
indication of how to break such a tie, we will also certify
this question to the Indiana Supreme Court. Upon receipt
of the answers to both certified questions, the trial court
can proceed to trial with certainty as to the law.
I.
These cases arise out of a fatal plane crash in Somerset,
Kentucky, in January of 2000. Dennis Schalliol, a
Pennsylvania resident, was employed as a salesman by
Hart National, a Pennsylvania Corporation with its principal
place of its national real estate business in Pennsylvania.
B. Kenin Hart, also a Pennsylvania resident, was the sole
owner, chairman, and CEO of Hart National. In 1998, Hart
National established a subsidiary, Hart Delaware, whose
main job it was to operate the aircraft in question.
(Although called Hart Delaware, it is based in
Pennsylvania.) Hart Delaware had but one employee, John
Fare, a New Jersey resident and pilot, who was hired to fly
the airplane. The airplane was hangared and operated out
of the Northeast Philadelphia Airport for the primary
8
purpose of transporting employees of Hart National from
Pennsylvania to related business sites.
In January of 2000, the airplane departed from Northeast
Philadelphia Airport bound for Ohio State University
Airport, via Cincinnati, with pilot Fare and passengers
Schalliol and Hart on board. After picking up a broker, Loy
Thompson, in Cincinnati, the plane traveled to Ohio State
University Airport in Columbus and remained there
overnight. The next morning, pilot Fare received a weather
briefing indicating that there were bad conditions at the
scheduled destination of Somerset, Kentucky. Such
conditions required an instrument flight rules (IFR) landing.
While en route to Kentucky, pilot Fare communicated with
federal air traffic controllers at the Indianapolis Air Route
Traffic Control Center who cleared the flight for the SDF
(Simplified Directional Facility) runway 4 approach at the
Somerset airport. The SDF system is a group of
instruments that guides a plane horizontally onto the
runway. Together with an altimeter, it allows a plane to
land “blind.” As it turns out, the SDF approach had been
out of service since 1995, a fact reflected in the Airport
Facility Directory (“AFD”) published by the Federal Aviation
Administration (“FAA”), although pilot Fare was unaware of
that condition.
The plane’s last radio contact with the air traffic
controllers occurred when it was about 30 miles north of
the Somerset airport. As it descended, weather conditions
made it impossible to see the surrounding terrain. With no
further contact from the air traffic controllers, pilot Fare
relied on the Instrument Approach Procedure (“IAP”), a
document compiled and published in Washington, D.C.
that lists navigable IFR approaches to various airports
around the country, to guide the landing. If operational, the
SDF would have guided the plane safely onto the runway,
but instead the plane drifted off course and struck a guy
wire from a radio communications tower approximately 3.3
miles from the Somerset airport. The resulting crash killed
everyone on board.
The personal representatives of the decedents brought
suit in the District Court for the Eastern District of
Pennsylvania. Plaintiffs’ amended complaint under the
9
Federal Tort Claims Act, 28 U.S.C.A. §§ 1346(b), 2671 et al.
(“FTCA”), alleged that the U.S. was negligent in publishing
the IAP for the SDF approach to Somerset when in fact that
approach had been out of service for five years at the time
of the crash.3 It further alleged that the air traffic
controllers in Indiana acted negligently by issuing a
clearance for an approach that was out of service, failing to
monitor radar scopes after clearance was given, failing to
conduct proper briefings, and failing to issue a safety alert
to pilot Fare.
Plaintiff Mary Schalliol, as personal representative of the
estate of Dennis Schalliol, not only brought a claim of
negligence against the United States under the FTCA, but
also sued the estate of pilot Fare (alleging his negligence)
and Fare’s employer, Hart Corporation/Delaware Division.
The estate of pilot Fare, through separate counsel, has also
brought a cross-claim of negligence against the United
States. In a separate action that has been consolidated on
appeal, four personal representatives of the estate of B.
Kenin Hart, his three children and his mother (collectively,
the “Simon Plaintiffs”), have brought claims against the
United States. The United States filed separate motions for
determinations of the applicable choice of law in each of the
cases, and each motion sought the application of Indiana
substantive law to the claims pled against it under the
FTCA. Plaintiff Schalliol, defendants Fare and Hart
Delaware, and the Simon Plaintiffs each responded
separately seeking the application of Pennsylvania
substantive law, which is far more favorable to tort victims.
As explained supra, the District Court found a true
conflict between Indiana and D.C.’s choice-of-law rules, so
it employed the choice-of-law procedure set forth in Gould
Electronics to determine which jurisdiction’s rules apply.
Gould delineates five common approaches in choosing
between competing choice-of-law regimes, although it does
not express a preference for any of the five because, under
the facts of that case, one of the approaches was
inapplicable and the remaining four yielded the same
3. As their arguments are substantively identical, this opinion will refer
to all claimants against the United States as “Plaintiffs.”
10
outcome. Applying the approaches to the facts in this case,
the Court found the first one, “when the injury can be
parsed by the acts or omissions in the different states, . . .
applying the relevant state’s choice of law rules for each act
or omission,” 220 F.3d at 182, inapplicable because the
injury — death in a plane crash — cannot be parsed. It
concluded that the second approach, “elect[ing] the choice
of law rules of the place of the last act or omission having
a causal effect,” id., clearly favored Indiana, the location of
the air traffic controllers.
The District Court likewise determined that the third
approach, electing the rules of “the place of the last act or
omission having the most significant causal effect,” id.,favored Indiana because a direct nexus exists between the
conduct of the controllers and the crash. The fourth
approach, “select[ing] the choice of law rules of the state in
which ‘physical acts’ could have prevented the injury,” id.
at 183, was found to be indeterminate because just as the
air traffic controllers in Indiana could have given different
instructions, the federal employees in D.C. could have
published an accurate IAP. Finally, the fifth approach,
choosing “based on where the ‘relevant’ act or omission
occurred,” id., was found to be indeterminate because there
were two independent acts of negligence, each of which
could have been fatal in its own right. In sum, the District
Court concluded that of the five Gould approaches, one was
inapplicable, two favored Indiana, and two were
indeterminate, so it applied Indiana’s choice-of-law rules to
choose between Indiana and Pennsylvania substantive law.4
4. Although on these facts an argument might have been made for D.C.
or perhaps even Ohio or Kentucky substantive law, no party urges such
a result. When such a situation arises in a diversity case, the laws of
each unpleaded jurisdiction are presumed to be identical to the law of
the forum (Pennsylvania) on all issues. See, e.g., National Ass’n of
Sporting Goods Wholesalers, Inc. v. F.T.L. Marketing Corp., 779 F.2d
1281, 1285 (7th Cir. 1985) (“Stated in another manner, unless the
parties argue otherwise, it is assumed that the law of the forum and the
laws of the applicable jurisdiction are in substance the same.”). As this
case arises under federal question rather than diversity jurisdiction,
however, we assume analogously that the laws of unpleaded jurisdictions
are identical to those of the jurisdiction whose substantive law is
11
Indiana employs a modified lex loci delicti test, which
applies the substantive law of the jurisdiction where the
tort was committed. Hubbard, 515 N.E. 2d at 1073.
Generally, in Indiana wrongful death or injury cases, the
place where the death occurred is the site of the tort’s
commission or of the “last event necessary,” see, e.g.
Lambert v. Yellowbird, Inc., 496 N.E.2d 406, 409 (Ind. Ct.
App. 1986), which in this case is Kentucky, the site of the
crash and resulting deaths. As the District Court explained,
however, the Indiana inquiry does not end here:
In those instances where the place of the tort bears
little connection to the legal action, this Court will
permit the consideration of other factors such as: 1)
the place where the conduct causing the injury
occurred; 2) the residence or place of business of the
parties; and 3) the place where the relationship is
centered. These factors should be evaluated according
to their relative importance to the particular issues
being litigated.
Hubbard, 515 N.E.2d at 1073 (quoting Restatement
(Second) of Conflicts of Laws § 145(2) (1971)).
The District Court concluded that Kentucky “has little
connection to the legal action” concerning the FTCA claims
against the United States’s air traffic controllers and chart
publishers, so it turned to the three supplemental Hubbard
factors. It found that the first, “the place where the conduct
causing the injury occurred,” favored Indiana because
although negligence also occurred in D.C., “the conduct
most directly affecting the plane’s landing clearly occurred
in Indiana.” For example, the Indiana controllers were the
only actors with direct contact with and control over the
pilot and plane.
ultimately selected. In essence, there is presumed to be no conflict
between the laws of Pennsylvania, D.C., and Kentucky, and as the
Restatement (Second) explains: “When certain contacts involving a tort
are located in two or more states with identical local law rules on the
issue in question, the case will be treated for choice-of-law purposes as
if those contacts were grouped in a single state.” § 145, Comment i
(1975).
12
As to the second Hubbard factor, “the residence or place
of business of the parties,” they are various — Indiana
(plantiff Schalliol), Pennsylvania (three of the four Simon
plaintiffs and passenger Hart), New York (fourth Simon
plaintiff), Delaware (defendant Fare/Cross-plaintiff Fare and
defendant Hart Delaware), and, with respect to the
defendant United States, all states or no state.5 The District
Court concluded that this factor favored no state, so it
apparently gave that factor relatively little weight. Finally,
the District Court concluded that the third Hubbard factor,
“the place where the relationship is centered,” could
likewise point to any of several locations since none of the
parties was ever located in the same state as any adverse
party.
Based on these three factors, the District Court
concluded that Indiana bears the “edge” as the jurisdiction
with the most significant contacts to the negligence claims
against the United States. However, the District Court
recognized that such a decision would effectively dictate the
case’s outcome, which is essentially a question of damages
— it is hard to envision a successful defense to the
Government’s liability. Because the choice-of-law issues are
so critical, the Court certified them for our immediate
review pursuant to 28 U.S.C. § 1292(b), which requires
that: (1) the issue involve a controlling question of law; (2)
as to which there are substantial grounds for difference of
opinion; and that (3) an immediate appeal of the order may
materially advance the ultimate termination of the
litigation. This being a clear case for § 1292(b) certification,
we accepted it and, under Rule 5 of the Federal Rules of
Appellate Procedure, requested briefing and heard oral
argument.
The District Court had diversity jurisdiction over the
Simon and Schalliol suits pursuant to 28 U.S.C. § 1332. It
had jurisdiction over Fare’s cross-claim against the United
States by virtue of the Federal Tort Claims Act, 28 U.S.C.
§§ 1346(b) and 2671 et seq. We exercise jurisdiction
5. The District Court did not accurately state the location of Hart
Delaware which, despite its misleading name, is incorporated in and
does business primarily in Pennsylvania. Also, although Plaintiff Fare
lived in Delaware, he worked exclusively in Pennsylvania.
13
pursuant to 28 U.S.C. § 1292(b). Because choice-of-law is a
purely legal determination, our review is plenary.
II.
The Federal Tort Claims Act waives sovereign immunity
against persons suing the federal government for
commission of various torts. In a multi-state tort action, it
requires a federal court to apply the law of the place where
the acts of negligence occurred. 28 U.S.C.A. §§ 1346(b),
2674. The Supreme Court, however, has expressly rejected
the argument that the law of the place of injury should
apply where negligence occurs in one state and results in
injury or death in another. Richards v. U.S., 369 U.S. at 1.
Richards dictates that either Indiana or D.C.’s choice-of-law
rules must apply, for those are the two places where
government negligence allegedly occurred — the air traffic
controllers were based in Indiana, and the faulty IAP was
published in D.C. Although each of the key questions will
be certified, for the benefit of the Indiana Supreme Court
and the parties, it is important that we lay out the factual
and legal background reasoning that animates our decision.
In choosing between Indiana and D.C.’s choice-of-law
regimes, we must first determine whether there exists a
“true conflict” between them. Gould, 220 F.3d at 179, 181.
The parties disagree as to whether Indiana and D.C.’s rules
differ in any material respect. Indiana’s choice of law
utilizes a modified lex loci delicti test. Hubbard, 515 N.E.2d
at 1073. It begins with the presumption that the
substantive law of the place where the tort was committed
governs the case. Id. However, if the place of the tort bears
little connection to the legal action, Indiana follows the
“most significant relationship” test detailed in the
Restatement (Second) Conflicts of Laws. Id. at 1074. The
parties agree that Kentucky, the location of the tort, has
little connection to the litigation since the plane merely
crashed there. Therefore, in this case Indiana law defaults
to the “most significant relationship” test, in which it
considers three factors: (1) the place where the conduct
causing the injury occurred; (2) the residence and place of
incorporation and place of business of the parties; and (3)
the place where the parties’ relationship is centered.
14
In comparison, D.C. implements a hybrid of the
“governmental interest” and Restatement (Second)
methodologies that identifies the governmental policies
underlying the applicable laws and determines which
state’s policy would be most advanced by having its laws
applied to the facts of the case. Raflo v. United States, 157
F. Supp.2d 1, 4 (D.D.C. 2001). The stronger state interest
is found by examining: (1) the place where the injury
occurred; (2) the place where the conduct causing the
injury occurred; (3) the domicile, residence, place of
incorporation and place of business of the parties; and (4)
the place where the relationship is centered. Id. at 5.
Although D.C.’s analysis also takes into account
government policies, plaintiffs contend that the factors D.C.
considers do not differ meaningfully from those Indiana
considers, and therefore that there is merely a false conflict
between D.C. and Indiana law.
The United States disagrees, asserting that a true conflict
exists. It points out that Indiana did not adopt the policy
component of § 6 of the Second Restatement. See, e.g.,
Hubbard, 515 N.E.2d at 1074 (declining to balance
competing interests of states by identifying policies
underlying their differing laws); In re Bridgestone/Firestone,
Inc., Tires Prods. Liab. Litig., 155 F. Supp.2d 1069, 1083
n.10 (S.D. Ind. 2001) (noting that interests of each state are
not determinative or generally even considered by Indiana
courts). It notes that academic commentators agree that
Indiana eschews such policy considerations. See, e.g.,
Symeon C. Symeonides, The Judicial Acceptance of the
Second Conflicts Restatement: A Mixed Blessing, 56 Md. L.
Rev. 1248, 1252, 1268 & n.136, & 1272 n.159 (1997)
(“[Indiana’s] significant-contacts approach differs from
section 6 of the Restatement (Second) in that it calls for a
consideration of the factual contacts alone, rather than a
set of policies in light of the factual contacts as does the
Restatement (Second).” (emphasis added). Plaintiffs,
however, assert that Indiana courts do consider state
policies in their analysis. See, e.g., In Re the Estate of
Bruck, 632 N.E.2d 745, 749 (Ind. Ct. App. 1994) (holding
on the specific point at issue that, although Indiana law
would otherwise apply, “only under Ohio law can the
distribution fulfill the essential purpose of the damages,
15
which is to benefit the immediate survivors regardless of
dependency”).
It is of course possible that even if D.C. considers policy
while Indiana does not, the two schemes would present a
false conflict because they would ultimately select the same
state’s substantive law. But, the United States argues, the
conflict in choice-of-law regimes goes deeper than mere
consideration of policy, for D.C.’s choice-of-law rules
recognize the concept of depeçage while Indiana’s do not.
Depeçage is “the process whereby different issues in a
single case arising out of a single set of facts are decided
according to the laws of different states.” Broome v. Antlers’
Hunting Club, 595 F.2d 921, 923 n.5 (3d Cir. 1979). In the
case at bar, depeçage would enable a court to apply one
state’s laws to assess liability and another’s to assess
damages. It is clear that D.C.’s choice-of-law rules permit
depeçage, see, e.g., Stutsman v. Kaiser Foundation Health
Plan of the Mid-Atlantic States, Inc., 546 A.2d 367, 373
(D.C. App. 1988), so a critical question for “true conflict”
purposes is whether Indiana’s do as well.
Plaintiffs identify several Indiana decisions that allegedly
employ depeçage, including Allen v. Great American Reserve
Ins. Co., 766 N.E.2d 1157, 1162 (Ind. 2002) (“In analyzing
each of the counts of the plaintiffs’ complaint, it is first
necessary to determine which state’s law applies to that
count. The answer may differ for different counts and may
differ between defendants as to a single count.”); Cap
Gemini America, Inc. v. Judd, 597 N.E.2d 1272, 1281 (Ind.
Ct. App. 1992) (undertaking separate choice-of-law
analyses on liability and damages); Estate of Sullivan v.
United States, 777 F. Supp. 695 (N.D. Ind. 1991) (applying
Arizona law to the medical malpractice action and Indiana
law to the wrongful death claim). None of these cases,
however, establishes that Indiana law embraces depeçage.
Allen was a routine application of different choice-of-law
analyses to different counts, as opposed to different issues
within a single count. Cap Gemini conducted a choice-of-
law analysis for damages purposes, but there were actually
two distinct claims at stake in that case, the second of
which involved only a question of damages — the liability
and damages issues involved different theories of recovery.
16
Finally, although Estate of Sullivan did employ depeçage,
the Indiana court in that case was applying Arizona’s
choice-of-law rules, not Indiana’s.
Viewing Indiana’s caselaw as a whole, the closest an
Indiana court has come to employing depeçage is in In re
the Estate of Bruck, 632 N.E.2d 745 (Ind. Ct. App. 1994).
There the court said in dictum that, if it had found a true
conflict, it would have applied a New York decision stating
that “the recovery and distribution aspects of wrongful
death cases may be separated when choice-of-law questions
arise.” Id. at 749. But as the District Court correctly noted,
Bruck’s dictum is not very valuable here, especially since no
Indiana case has explicitly employed depeçage and the
dictum itself is from an intermediate appellate court.
Plaintiffs offer one slightly different rationale in favor of
depeçage: that many Indiana cases adopt § 145 of the
Restatement, which in turn incorporates the general criteria
of § 6 of the Restatement. See Hubbard, 632 N.E. 2d at
1073-74 (Ind. 1987). Because § 6 endorses depeçage,
plaintiffs submit that depeçage has been incorporated
indirectly into Indiana law. However, given the possibility
that Indiana has adopted only part of the Restatement, we
are unwilling to conclude that Indiana has embraced
depeçage based only on such roundabout reasoning.
In sum, we find no evidence that Indiana courts employ
the concept of depeçage, and absent depeçage it is clear
that there is a true conflict between Indiana and D.C.’s
choice-of-law rules. We nevertheless note that the Indiana
Supreme Court has not definitively resolved the matter, and
we believe that a question of such importance is best left to
that Court’s authoritative disposition. We will therefore
certify the issue to the Indiana Supreme Court pursuant to
Rule 64 of the Indiana Rules of Appellate Procedure.
III.
In a multistate tort action, the FTCA requires a federal
court to apply the law of the place where the acts of
negligence occurred. 28 U.S.C. §§ 1346(b), 2674; Richards,
369 U.S. at 1. We must therefore apply either Indiana’s or
D.C.’s choice-of-law rules, but we need only choose between
17
them if they conflict. For the reasons outlined above, we
will assume arguendo that Indiana does not embrace the
concept of depeçage, and therefore that a true conflict
exists. In Gould, 220 F.3d at 169, we addressed the matter
of how to resolve such a conflict. Our opinion surveyed the
caselaw and literature on the subject and identified five
common approaches: (1) applying different rules to different
theories of liability; (2) choosing the place of the last
allegedly-wrongful act or omission; (3) determining which
asserted act of wrongdoing had the most significant effect
on the injury; (4) choosing the state in which the United
States’ physical actions could have prevented injury; and
(5) determining where the “relevant” act or omission
occurred. Under Gould’s facts, however, the first approach
was inapplicable and the final four pointed toward the
same state, so we declined to adopt any one approach.
The case at bar is much closer, and the approaches yield
conflicting results. The parties agree that the first
approach, applying different rules to different theories of
liability, is inapplicable because there is only one theory of
liability — negligence. The second approach, choosing the
place of the last allegedly-wrongful act or omission, seems
clearly to favor Indiana. Although it is true that the IAP
published in D.C. incorrectly depicted as operational an
SDF approach that had been out of service for five years,
(Plaintiffs’ Stipulation of Facts, A96), the air traffic
controllers’ negligence postdated the chartmakers’
negligence. Plaintiffs’ pretrial memorandum alleges that the
controllers: (1) failed to review various Area and Hazard
binders which would have revealed that the SDF approach
was out of service; (2) cleared the flight for landing on an
out-of-service approach; (3) failed to monitor the plane on
radar during the approach, a safeguard which would have
revealed that the plane was off course; (4) failed to issue a
low altitude safety advisory; and (4) failed to respond to
pilot Fare’s radio communication after his first pass by the
runway. (Report of Expert J. Gary Parham, Schalliol
Appendix at 104A).
The plaintiffs, however, submit that the air traffic
controllers’ last-in-time negligence is relatively unimportant
because their location in Indiana was a mere fortuity —
18
they could have been anywhere, and Indiana as a
jurisdictional entity had nothing to do with the plane crash.
They therefore argue that this factor should be given
relatively little weight, and cite to In re Aircrash Disaster
Near Roselawn, Indiana on October 31, 1994, 926 F. Supp.
736, 743 n.9 (N.D. Ill. 1996) (“The manner in which federal
air traffic controllers choose to partition air space has no
bearing on the litigation of the decedent’s injuries or the
interests of the several states in this litigation.”).
The United States disagrees that the flight controllers’
location was fortuitous, because the plane’s flight plan
ensured that it would traverse the controllers’ airspace,
where they would communicate with the pilot. It also
argues that the Aircrash Disaster case is inapposite, for in
that case no party had sued the United States alleging air
traffic controller negligence, so the location of the
controllers themselves was not a factor.
We are satisfied that this “last wrongful act” approach
favors Indiana law even if the air traffic controllers’ location
was to some degree fortuitous. It certainly is not entirely
fortuitous, for the federal government has undoubtedly
positioned air traffic controllers strategically so as to create
manageable regions of airspace. Indeed, the publication of
the IAP in Washington, D.C. was at least as fortuitous, for
there is no reason why its contents could not have been
compiled and distributed in any jurisdiction.
The third Gould approach, determining which asserted
act of wrongdoing had the most significant effect on the
injury, is quite close. The District Court concluded that this
test favored Indiana, where the acts of negligence assertedly
had the most “direct nexus” to the crash. The Plaintiffs
disagree, arguing that this concept of “direct nexus” flirts
dangerously close to the second factor, which is the place
of the most recent act. In their view, “most significant
cause” is not synonymous with “proximate cause,” and they
argue that this factor actually favors D.C. because the
chartmakers in D.C. committed a (in fact, “the”) major sin
of commission by producing a defective product. The air
traffic controllers, on the other hand, merely relied upon
this inaccurate map, making their negligence less
significant.
19
As explained supra, however, it is clear that the air traffic
controllers’ negligence went beyond passive reliance on a
faulty chart; among other things, they failed to review
mandatory binders, failed to monitor the flight’s approach
on radar, and failed to respond to the pilot’s radio
communications. The Government does not meaningfully
challenge these points — although it maintains that the air
traffic controllers were not negligent, this position is
undermined by its concession at oral argument that: “the
air traffic controllers cleared the pilot for an approach; the
navigational aid for that approach was out of service, [and]
they knew it was out of service but forgot.” We therefore
conclude that with clear negligence by the air traffic
controllers counter-balancing that of the chart makers, this
third approach is also indeterminate. Each act of negligence
might fairly be termed a “but for” cause of the crash, and
reasonable minds could disagree on which cause (if any)
was most significant.
The fourth approach, choosing the state in which the
United States’s physical actions could have prevented
injury, seems likewise to be indeterminate. The air traffic
controllers could have given correct instructions and been
more attentive during the plane’s approach, and the chart
makers could have produced an accurate chart. No one
physical act seems to be the clear cause of the accident.
The fifth and final Gould approach, determining where
the “relevant” act or omission occurred, seems to us to add
nothing unique to the inquiry. Indeed, it seems
indistinguishable from the third approach of identifying the
“most significant” act of negligence. We therefore conclude
that this approach is also indeterminate.
Of the five Gould approaches, then, one is inapplicable,
three are indeterminate, and one favors Indiana. Although
Gould might therefore counsel choosing Indiana law insofar
as it “outscores” D.C. law, the approaches overlap to such
an extent that it would not seem judicious to resolve the
question in so simplistic a fashion. At all events, Gould
itself does not compel that outcome, and we are unwilling
to endorse a system that requires an ad hoc balancing of
vague and overlapping approaches each time we choose
among choice-of-law regimes. Indeed, it is unclear that one
20
method of picking a choice-of-law regime is superior to
another ex ante.
Jurisdictions’ interests — their policy concerns — are
safeguarded by their substantive laws, so there is much at
stake in choosing a substantive regime in a case. Likewise,
because jurisdictions’ choice-of-law regimes differ and
might therefore affect which substantive law applies, each
jurisdiction has an interest in applying its choice-of-law
rules to a case. There is, however, no compelling reason for
a federal court to prefer one method to another for choosing
among competing jurisdictions’ choice-of-law regimes. For
example, it is unclear whether a federal court’s adoption of
a “last act” approach would yield more desirable final
outcomes than a “most significant contact” approach, for
once the “last act” jurisdiction is identified, its choice-of-law
rules might in turn employ a “last act” approach, a “most
significant contacts” approach, or another approach
entirely.
We therefore conclude that clarity is the most important
virtue in crafting a rule by which we choose a jurisdiction.
In that sense, Gould’s methodology is far from desirable, for
it lists several often-conflicting and overlapping approaches
without providing any guidance as to which approach
should be given the most weight. Today we refine Gould by
adopting a single approach to resolving choice-of-law
disputes in FTCA cases: we will apply the choice-of-law
regime of the jurisdiction in which the last significant act or
omission occurred. This has the salutary effect of avoiding
the selection of a jurisdiction based on a completely
incidental “last contact,” while also avoiding the conjecture
that “most significant act” inquiries often entail.
In this case, the “last significant act” approach clearly
points to Indiana, the location of the air traffic controllers’
negligence. We should therefore apply Indiana’s choice-of-
law rules to determine whether Indiana’s or Pennsylvania’s
substantive laws apply.
IV.
Indiana law first looks to determine whether there is a
true conflict between the competing jurisdictions’
21
substantive law. Assuming that depeçage does not exist,
see supra, we must look at the negligence cause of action
as a whole. This case is essentially about damages, for
liability does not seem difficult and it is clear that
Pennsylvania and Indiana allow very different degrees of
recovery. Pennsylvania allows joint-and-several liability and
right of contribution, while Indiana does not. See 42
Pa.C.S.A. § 8322, 8324; I.C. § 34-51-2-12. Moreover,
although both states maintain survival statutes that allow
recovery of survival damages for the decedent’s personal
injuries and consequent damages, Indiana does not permit
recovery for both wrongful death and survival damages.
Cahoon v. Cummings, 715 N.E. 2d 1 (Ind. App. 1999).
Lastly, unlike Indiana, Pennsylvania damages include the
decedent’s conscious pain and suffering from the moment
of injury to the time of death. It is clear that a true conflict
exists.
In the case of a true conflict, Indiana applies the law of
the place of the tort, unless that place “bears little
connection to the legal action.” Hubbard, 515 N.E.2d at
1073-74. Kentucky is the place of the tort, and the parties
agree that it has little relevance; in such instances, Indiana
employs a three-part test to determine which state’s
substantive laws apply, under which it considers: “(1) the
place where the conduct causing the injury occurred; (2)
the residence or place of business of the parties; and (3) the
place where the relationship is centered.” Id. Each of these
factors must be evaluated “according to their relative
importance to the particular issues being litigated.” Id.
The first factor, “the place where the conduct causing the
injury occurred,” clearly favors Indiana because no
negligence occurred in Pennsylvania. The second factor,
“the residence or place of business of the parties,” seems to
favor Pennsylvania. Hart Delaware, which owned the plane,
was incorporated in Pennsylvania, and plaintiff Fare worked
in Pennsylvania. Although plaintiff Schalliol lived in
Indiana, three of the four Simon plaintiffs lived in
Pennsylvania. While the air traffic controllers presumably
lived in Indiana, they are not the defendants — the United
States is the defendant, and it is assumed to reside in all
states or no state. Compare Clawans v. United States, 75 F.
22Supp. 2d 368, 374 (D.N.J. 1999) (noting that U.S. is not a
resident of a particular state), with United States v.
Whitcomb, 314 F.2d 415, 417 (4th Cir. 1963) (finding that
the United States is a resident of every state). On balance,
the “residence or place of business of the parties” seems to
favor Pennsylvania.
The third factor, “the place where the parties’ relationship
is centered,” is somewhat difficult to conceptualize on these
facts. At no time were the parties located in the same state
— their only relationships involved reliance on a map and
communication over a radio, neither of which seems
“centered” in a particular place.
Surveying the three Hubbard factors, the first points to
Indiana, the second to Pennsylvania, and the third is
indeterminate. Like our decision in Gould, Hubbard gives
no guidance as to which factor is most important or how to
“break a tie,” so any decision by this court on which
substantive law Indiana would apply would be little more
than a guess. We will therefore certify this issue to the
Indiana Supreme Court under Rule 64 of the Indiana Rules
of Appellate Procedure.
V.
For the above reasons, we will certify the following
questions to the Indiana Supreme Court: (1) whether a true
conflict exists between Indiana’s and D.C.’s choice-of-law
rules; and (2) if there is a true conflict and Indiana’s choice-
of-law rules therefore control per our “last significant act”
test, how to resolve a split among the Hubbard factors in
choosing a jurisdiction’s substantive law when one factor
points toward Indiana, another toward Pennsylvania, and
the third is indeterminate, and what substantive law
Indiana would choose under these facts.6
6. Pilot Fare, who is being sued by the Plaintiffs in a Pennsylvania court,
makes one argument that concerns only his cross-claim:
As a matter of equity, it is unfair to judge [Fare’s] alleged negligent
acts or omissions as a Defendant under Pennsylvania law, and then
23
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
judge any alleged comparative negligent acts or omissions by Fare
as a Cross-Claimant (Plaintiff) according to a different state’s
substantive law. As a result, regardless of the various state’s
interests in the application of their substantive law, Pennsylvania
law should apply. To hold otherwise would put the Estate of Fare in
the tenuous position of being judged by two different standards.
We find this argument to be without merit.