In the
United States Court of Appeals
For the Seventh Circuit
Nos. 09-2280, 09-3020
Y AO -W EN C HANG , et al.,
Plaintiffs-Appellants,
v.
B AXTER H EALTHCARE C ORPORATION, et al.,
Defendants-Appellees.
Appeals from the United States District Court
for the Northern District of Illinois, Eastern Division.
MDL No. 986 JFG—John F. Grady, Judge.
S UBMITTED F EBRUARY 12, 2010—D ECIDED M ARCH 26, 2010
Before P OSNER, E VANS, and T INDER, Circuit Judges.
P OSNER, Circuit Judge. This is a parallel case to Abad v.
Bayer Corp., 563 F.3d 663 (7th Cir. 2009), decided by this
panel last year. The case was dismissed by the district
court, and the plaintiffs have appealed. Ordinarily when
all parties to an appeal are represented by counsel, the
court directs oral argument unless the parties waive
argument and we accept the waiver. But when, as in
this case, an appeal is closely related to an earlier appeal,
2 Nos. 09-2280, 09-3020
or is successive to it, we are more likely to deny oral
argument on the ground that “the facts and legal argu-
ments are adequately presented in the briefs and record,
and the decisional process would not be significantly aided
by oral argument.” Fed. R. App. P. 34(a)(2)(C). We have
decided to do that in this case.
Abad was a diversity (technically an “alienage,” 28 U.S.C.
§ 1332(d)(2)(B)) class action on behalf of several hundred
Argentines, consolidating a number of suits that had
been filed in various U.S. states and transferred by
the multidistrict panel to the federal district court in
Chicago, pursuant to 28 U.S.C. § 1407, for inclusion in
In re Factor VIII or IX Concentrate Blood Products Litiga-
tion. That is the name that has been given to the pretrial
proceedings in a large number of products-liability suits by
hemophiliacs who had been infected with HIV (the virus
that causes AIDS) that had gotten into the clotting factor
that persons afflicted with hemophilia inject into their
bloodstreams in order to control bleeding. The plaintiffs
charged that the defendants—the manufacturers of the
clotting factors—had failed to eliminate HIV from the
blood of donors from which the clotting factors had been
made, as they could and should have done by applying
heat in the manufacturing process.
The class members in Abad had acquired and injected
and become infected by the contaminated clotting
factors in Argentina, and the district court granted the
defendant’s motion to dismiss the action on the ground of
forum non conveniens—the doctrine that allows a court to
dismiss a suit if there are strong reasons for believing that
Nos. 09-2280, 09-3020 3
it should be litigated in the courts of another, normally a
foreign, jurisdiction, in Abad the courts of Argentina.
We affirmed.
The district court had deferred ruling on the
defendant’s motion until completion of the plaintiffs’
pretrial discovery. The defendant’s discovery would
have to be conducted in Argentina because that was
where the members of the class lived. So while deposi-
tions and other documents obtained in the plaintiffs’
discovery would have to be translated into Spanish if the
suit was litigated in Argentina, documents obtained in
the defendant’s discovery in Argentina would have to be
translated into English if the case was tried in Chicago.
The plaintiffs argued that under Argentine choice of law
rules, the substantive law that would be applied if the case
were litigated in an Argentine court would be American
rather than Argentine law. If true, this would, we said,
have been a powerful argument for leaving the case in
Chicago. But as near as we were able to determine, it
was false. Argentine law would apply wherever the
case was tried; and especially because of the dearth of
relevant Argentine precedents or other sources of law,
the Argentine court would probably do a better (more
authentic, legitimate, authoritative) job of applying
(if necessary creating) Argentine law than an American
court. And we noted that the presumption in favor of
a plaintiff’s choice of the court in which to litigate (a
presumption based in part on the costs and delay
involved in restarting a case in another court) is
weakened when the plaintiffs are foreign and could
4 Nos. 09-2280, 09-3020
litigate the case in their home court. Thus on balance
Argentina was the more convenient, the more suitable,
forum for the litigation.
The present case, filed originally in California by resi-
dents of Taiwan but transferred by the multidistrict panel
to the district court in Chicago with the other clotting-
factor suits for pretrial proceedings, is similar to Abad,
although it adds a breach of contract claim to the
tort claims. (Like Abad, it is actually a series of cases
that have been consolidated for purposes of pretrial pro-
ceedings.) The main tort claim is that the defendants
acquired blood from high-risk donors, processed it im-
properly in California where they manufactured clotting
factors, and after discovering that the factors were con-
taminated by HIV nevertheless continued to distribute
the product in foreign countries while withdrawing
them from distribution in the United States. Thus, like
the plaintiffs and class members in the Abad case, the
plaintiffs in this case, or the decedents whom they repre-
sent, reside, and obtained and injected the clotting factor,
in a foreign country. The plaintiffs also charge that the
defendants fraudulently induced them to enter into a
settlement agreement that released the defendants from
liability in exchange for paying $60,000 to each plaintiff.
The breach of contract claim alleges violation of a term
of the settlement.
The district judge dismissed some of the plaintiffs’ claims
as untimely and the others on the ground of forum non
conveniens. Although a dismissal on the latter ground is
without prejudice, it is appealable, illustrating that the
Nos. 09-2280, 09-3020 5
“rule” that dismissals without prejudice are nonfinal and
therefore nonappealable under 28 U.S.C. § 1291 is a Swiss
cheese. See Schering-Plough Healthcare Products, Inc. v.
Schwarz Pharma, Inc., 586 F.3d 500, 506 (7th Cir. 2009);
Taylor-Holmes v. Office of Cook County Public Guardian, 503
F.3d 607, 609-10 (7th Cir. 2007). In Mañez v. Bridgestone
Firestone North American Tire, LLC, 533 F.3d 578, 584 (7th
Cir. 2008), we compared dismissal on grounds of forum
non conveniens to “a dismissal for lack of personal or
federal subject-matter jurisdiction, which, while fore-
closing future litigation of the matter in the court
issuing the order, does not preclude a plaintiff from
refiling and litigating in a proper forum.” And such
dismissals, though without prejudice, are of course
appealable.
The critical issue so far as the dismissals on the merits
are concerned is choice of law. When a diversity case is
transferred by the multidistrict litigation panel, the
law applied is that of the jurisdiction from which the
case was transferred, in this case California. In re Air
Disaster at Ramstein Air Base, Germany, on 8/29/90, 81 F.3d
570, 576 (5th Cir. 1996); Johnson v. Continental Airlines Corp.,
964 F.2d 1059, 1063 n. 5 (10th Cir. 1992); see also Ferens
v. John Deere Co., 494 U.S. 516, 521-31 (1990); Van
Dusen v. Barrack, 376 U.S. 612, 633-39 (1964); Interna-
tional Marketing, Ltd. v. Archer-Daniels-Midland Co., 192
F.3d 724, 729 (7th Cir. 1999); Larry Kramer, “Choice of Law
in Complex Litigation,” 71 N.Y.U. L. Rev. 547, 552 (1996).
The plaintiffs’ claims that the district judge dismissed on
the merits he dismissed as untimely under California law.
6 Nos. 09-2280, 09-3020
California statutes of limitations don’t begin to run
until the plaintiff discovers, or should in the exercise of
reasonable diligence have discovered, that he has a
claim against the defendant. Norgart v. Upjohn Co., 981
P.2d 79, 88-89 and n. 3 (Cal. 1999); Jolly v. Eli Lilly & Co., 751
P.2d 923, 927-28 (Cal. 1988); K.J. v. Arcadia Unified School
District, 92 Cal. Rptr. 3d 1, 10 (Cal. App. 2009). But the
discovery rule would not save the plaintiffs’ tort claims
from dismissal for untimeliness. True, the plaintiffs argue
that they didn’t have enough information on which to base
a suit until a New York Times article about the contamina-
tion of clotting factors with HIV was published on May 22,
2003, and therefore that their suit, filed in 2004, was timely,
since the California statute of limitations for personal-
injury claims is two years. Cal. Civ. P. Code § 335.1; Fox v.
Ethicon Endo-Surgery, Inc., 110 P.3d 914, 921 n. 3 (Cal. 2005).
But as the district court found, the plaintiffs had had a rea-
sonable basis to suspect that they had a cause of action
more than five years before the article appeared, when
their counsel had begun negotiations with two of the
defendants to settle negligence claims arising from the
contamination of the defendants’ clotting factors with
HIV. These negotiations culminated in the settlement
in 1998 on which the plaintiffs’ breach of contract claim
is based.
The plaintiffs argue that the limitations period should
have been tolled by defendants’ “fraudulent concealment”
because when entering into the settlement agreement
they said they had done nothing wrong and that they
were offering financial aid purely as a humanitarian
gesture. The plaintiffs are mistaken. Denial of liability
Nos. 09-2280, 09-3020 7
when negotiating a settlement agreement is the norm; it
is not evidence of fraudulent concealment of anything.
The district court was also correct in ruling in the
alternative that a California court would apply (“borrow”
is the technical legal term) the Taiwanese 10-year statute of
repose, because the plaintiffs’ tort claims arose under
Taiwanese law. The hemophiliacs whom the plaintiffs
represent were infected in the 1980s, more than
a decade before these suits were brought.
A statute of repose, which is designed specifically
for products-liability suits, cuts off liability after a fixed
number of years, whether or not the plaintiff should
have discovered within that period that he had a claim.
A statute of repose thus overrides the discovery rule.
It does this because of the long latency of many product
defects, which can under a discovery rule impose vast
and unpredictable products liability on manufacturers.
See Eaton v. Jarvis Products Corp., 965 F.2d 922, 929-31 (10th
Cir. 1992); Pullum v. Cincinnati, Inc., 476 So. 2d 657, 659-
60 (Fla. 1985); Davis v. Whiting Corp., 674 P.2d 1195-
96 (Ore. App. 1984).
If the plaintiffs’ tort claims arose in Taiwan, California
law makes the Taiwanese statute of repose applicable to
those claims. The reason is California’s “borrowing”
statute, which—sensibly designed to discourage forum
shopping—provides that “when a cause of action has
arisen in another State, or in a foreign country, and by
the laws thereof an action thereon cannot there be main-
tained against a person by reason of the lapse of time, an
action thereon shall not be maintained against him in
8 Nos. 09-2280, 09-3020
this State, except in favor of one who has been a citizen
of this State, and who has held the cause of action from
the time it accrued.” Cal. Civ. P. Code § 361; see McCann
v. Foster Wheeler LLC, 2010 WL 547274, at *8-10 (Cal. Feb. 18,
2010); cf. Flowers v. Carville, 310 F.3d 1118, 1123 (9th Cir.
2002) (Nevada law); Employers Ins. of Wausau v. Ehlco
Liquidating Trust, 723 N.E.2d 687, 694 (Ill. App. 1999). The
plaintiffs argue that their claims arose in California, not
Taiwan, because it was in California that the defendants
failed to process their clotting factors in a way that would
prevent contamination by HIV. But with immaterial
exceptions (such as trespass, where purely nominal
damages can be awarded even if there is no tangible harm,
because “a continuing trespass may ripen into a prescrip-
tive right and deprive a property owner of title to his or her
land,” Kronos, Inc. v. AVX Corp., 612 N.E.2d 289, 293 (N.Y.
1993); see also W. Page Keeton et al., Prosser and Keeton on
the Law of Torts § 13, p. 75 (5th ed. 1984); Restatement
(Second) of Torts § 163 and comment d (1965)), there is no
tort without an injury. That is the rule in California, e.g.,
Buttram v. Owens-Corning Fiberglas Corp., 941 P.2d 71, 77
n. 4 (Cal. 1997); United States Liability Ins. Co. v. Haidinger-
Hayes, Inc., 463 P.2d 770, 776, (Cal. 1970); In re Marriage
of Klug, 31 Cal. Rptr. 3d 327, 333 (Cal. App. 2005), as
elsewhere. E.g., Kamelgard v. Macura, 585 F.3d 334, 340-
41 (7th Cir. 2009) (Illinois law); Abad v. Bayer, supra, 563
F.3d at 669; Parris v. State Farm Mutual Automobile Ins. Co.,
494 S.E.2d 244, 246-47 (Ga. App. 1997); Keeton et al.,
supra, § 30, pp. 164-65. The tort of which the plaintiffs
complain thus occurred in Taiwan. See McCann v. Foster
Wheeler LLC, supra, at *10 and n. 5; see also Rajala v. Don-
Nos. 09-2280, 09-3020 9
nelly Meiners Jordan Kline, P.C., 193 F.3d 925, 928 (8th Cir.
1999) (Missouri law).
The case on which the plaintiffs principally rely, McKee
v. Dodd, 152 Cal. 637 (1908), was a breach of contract case
rather than a tort case. The breach had been committed
in New York, the place where payment was due, and
the suit was held to have arisen there. A claim of breach
of contract is complete when the breach is committed,
and indeed one can obtain a judgment in a breach of
contract action without proving any loss at all. E.g., Troyk
v. Farmers Group, Inc., 90 Cal. Rptr. 3d 589, 628 n. 36 (Cal.
App. 2009); Movitz v. First National Bank of Chicago, 148
F.3d 760, 765 (7th Cir. 1998); E. Allan Farnsworth, Contracts
§ 12.8, p. 757 (4th ed. 2004). Anyway the plaintiff was
in New York when the breach occurred, so the injury
also occurred there, just as it occurred in Taiwan in
the present case.
The plaintiffs concede that the suit “accrued” in Taiwan
but deny that it “arose” there. They misunder-
stand those terms. A claim “accrues” when the statute of
limitations begins to run; a claim that could not have
been discovered by the date on which it arose will not (in
a jurisdiction with a discovery rule) accrue then. E.g.,
Norgart v. Upjohn Co., supra, 981 P.2d at 88; United States
Liability Ins. Co. v. Haidinger-Hayes, Inc., supra, 463 P.2d at
775-77; Cada v. Baxter Healthcare Corp., 920 F.2d 446, 450 (7th
Cir. 1990). The terms “arose” and “accrued” often are
conflated, because, other than in cases in which the discov-
ery rule is invoked, usually the date on which the cause of
action “accrues” is also the date on which it “arises.” In re
10 Nos. 09-2280, 09-3020
Marriage of Klug, supra, 31 Cal. Rptr. 3d at 334. The plain-
tiffs’ claims arose in Taiwan, and that’s all that matters.
California courts would apply the Taiwanese statute
of repose in this case even if there were no borrowing
statute. Applying the “balancing of interests approach”
that California courts use to resolve conflict of laws issues,
a California court would reason that if Taiwan will not
provide a remedy to its own citizens, there is no reason
for California to do so. See McCann v. Foster Wheeler LLC,
supra, at *11, *13, *15-16; cf. Nelson v. Sandoz Pharmaceuticals
Corp., 288 F.3d 954, 965 (7th Cir. 2002); Macurdy v. Sikov &
Love, P.A., 894 F.2d 818, 821 (6th Cir. 1990). What interest
has California in treating Taiwanese plaintiffs more
generously than Taiwan treats them?
We turn to the claims that the district court dismissed
not as untimely but on the basis, rather, of forum non
conveniens. One set of claims arises from the settlement
agreement that provided the plaintiffs with $60,000
apiece as compensation for the injuries caused by the
contaminated clotting factors. The agreement contained
what the parties call a “scale-up” clause but would more
commonly be referred to as a “most favored nation”
clause. The clause required the defendants to increase
the compensation in the settlement agreement to what-
ever level the defendants agreed to in later settlements
with other clotting-factor claimants. The contract was
negotiated and signed in Taiwan, and while the plain-
tiffs argue that the scale-up clause is clear on its face
and applicable to their claims, the contract actually is
ambiguous. For it is silent on whether the reference to
Nos. 09-2280, 09-3020 11
other claimants who by receiving higher compensation
increase the plaintiffs’ entitlement is just to other
Taiwanese claimants, as the defendants argue, or to other
claimants anywhere in the world, as the plaintiffs ar-
gue—rather implausibly, given the enormous global
variance in damages awards. Evidence beyond the lan-
guage of the settlement agreement will be necessary to
disambiguate the clause, and it seems that most of
the persons who are in a position to give such
evidence live in Taiwan—the plaintiffs’ Taiwanese
counsel who negotiated the settlement, a Taiwanese
patient representative, members of the Taiwanese de-
partment of health, defendant’s Taiwanese outside
counsel, and an employee of defendants in Taiwan—
while only two live in the United States.
Taiwanese law makes it difficult to gather evidence
for use in a trial in a foreign country because Taiwan
is not a party to the Convention on the Taking of
Evidence Abroad in Civil or Commercial Matters,
http://hcch.net/index_en.php?act=conventions.text&cid=82
(visited Mar. 17, 2010); see 10B Federal Procedure § 26:906
(Lawyers ed. 2010). The alternative method of obtaining
evidence in a foreign country—sending a letter rogatory
to the foreign court, United States Department of State,
“Taiwan Judicial Assistance,” http://travel.state.gov/law/
info/judicial/judicial_669.html (visited Mar. 13, 2010)—
seems not to be a very satisfactory means of obtaining
evidence from Taiwan. See Kenneth C. Miller & Nancy
Pionk, “The Practical Aspects of Litigating against Foreign
Corporations,” 54 J. Air L. & Commerce 123, 146-49 (1988);
12 Nos. 09-2280, 09-3020
Hayes Bicycle Group, Inc. v. Muchachos Int’l Co., 2008 WL
4830570, at *2-3 (E.D. Wis. Oct. 31, 2008).
The only circumstance that would favor holding the
trial in California rather than in Taiwan would be the
greater convenience for the defendants, since they are
American companies. But as they don’t want the case
to be tried in California, or indeed anywhere else in
the United States, really there is nothing in favor of the
American forum. And as we pointed out in Abad,
“when application of the doctrine [of forum non
conveniens] would send the plaintiffs to their home court,
the presumption in favor of giving plaintiffs their choice
of court is little more than a tie breaker.” 563 F.3d at
667. There is no tie here.
The remaining claim that the district court dismissed
on grounds of forum non conveniens is the products-
liability claim of Chen-Chen Huang that may or may
not be time-barred. It is an unusual claim because
Huang is not a hemophiliac or a hemophiliac’s repre-
sentative. Rather, she claims to have been infected by
sexual relations with her boyfriend who was a
hemophiliac (now dead) and is believed to have become
infected with HIV from clotting factors manufactured
by one of the defendants. The critical issue at trial is
likely to be the likelihood that sex with her boyfriend
was responsible for Huang’s contracting HIV. The perti-
nent evidence is in Taiwan and for the reason noted
earlier would be difficult to obtain for use in a trial in
the United States.
A complication is that whether Huang’s claim would be
time-barred if litigated in a Taiwanese court is uncertain.
Nos. 09-2280, 09-3020 13
The defendants say they “candidly told the district
court that they do not know whether testimony in Taiwan
from, for example, medical providers might impeach
Ms. Huang’s assertion that she did not know of her HIV
infection until 2002, when such testimony could give
rise to a limitations defense.” Huang responds that this
wishy-washy statement fails to satisfy the defendants’
burden of proving that Taiwan is an “adequate” alternative
forum, and if it isn’t then dismissal on grounds of forum
non conveniens was improper.
The Supreme Court has said that “if the remedy pro-
vided by the alternative forum is so clearly inadequate or
unsatisfactory that it is no remedy at all,” such dismissal
is indeed improper, Piper Aircraft Co. v. Reyno, 454 U.S.
235, 254 (1981), as in such cases as Nemariam v. Federal
Democratic Republic of Ethiopia, 315 F.3d 390, 394-95 (D.C.
Cir. 2003), and El-Fadl v. Central Bank of Jordan, 75 F.3d
668, 677-79 (D.C. Cir. 1996). The alternative forum must
provide the plaintiff with “a fair hearing to obtain some
remedy for the alleged wrong.” Stroitelstvo Bulgaria Ltd. v.
Bulgarian-American Enterprise Fund, 589 F.3d 417, 421 (7th
Cir. 2009). But the relief need not be as comprehensive
or as favorable as a plaintiff might obtain in an American
court. Id.; see also, e.g., Piper Aircraft Co. v. Reyno, supra, 454
U.S. at 249; Capital Currency Exchange, N.V. v. National
Westminster Bank PLC, 155 F.3d 603, 610-11 (2d Cir. 1998).
It would be odd to subject the defendant to an incon-
venient forum merely to increase the chances that the
plaintiff will prevail on the merits. As the Supreme Court
explained in the Piper Aircraft case, “jurisdiction and venue
requirements are often easily satisfied. As a result, many
14 Nos. 09-2280, 09-3020
plaintiffs are able to choose from among several forums.
Ordinarily, these plaintiffs will select that forum whose
choice-of-law rules are most advantageous. Thus, if the
possibility of an unfavorable change in substantive law
is given substantial weight in the forum non conveniens
inquiry, dismissal would rarely be proper.” 454 U.S. at 250.
But the cases suggest that if the plaintiff’s suit would be
time-barred in the alternative forum, his remedy there
is inadequate—is no remedy at all, in a practical
sense—and in such a case dismissal on grounds of forum
non conveniens should be denied unless the defendant
agrees to waive the statute of limitations in that forum
and the waiver would be enforced there. Norex Petroleum
Ltd. v. Access Industries, Inc., 416 F.3d 146, 159 (2d Cir.
2005); Bank of Credit & Commerce Int’l (Overseas) Ltd. v. Bank
of Pakistan, 273 F.3d 241, 246-47 (2d Cir. 2001); Mercier v.
Sheraton Int’l, Inc., 935 F.2d 419, 426 (1st Cir. 1991);
Kontoulas v. A.H. Robins Co., 745 F.2d 312, 316 (4th Cir.
1984); but see Yavuz v. 61 MM, Ltd., 576 F.3d 1166,
1182 (10th Cir. 2009). There is an exception, however, for
cases in which a plaintiff seeks to defeat dismissal by
waiting until the statute of limitations in the alter-
native forum has expired and then filing suit in his pre-
ferred forum (with the longer limitations period) and
arguing that the alternative forum is inadequate. Compania
Naviera Joanna SA v. Koninklijke Boskalis Westminster
NV, 569 F.3d 189, 202-03 (4th Cir. 2009); cf. In re
Bridgestone/Firestone, Inc., 420 F.3d 702, 705-07 (7th Cir.
2005). That is different from the case in which as a conse-
quence of delays inherent in litigation the defendant
has acquired an airtight defense of untimeliness in the
Nos. 09-2280, 09-3020 15
alternative forum since the litigation began. See Aguinda
v. Texaco, Inc., 303 F.3d 470, 475, 478-79 (2d Cir. 2002). The
basis for dismissal on grounds of forum non conveniens
should be the superior convenience of the alternative
forum rather than a difference in substantive law that
spells doom for the plaintiff’s case if it is sent there.
The exception is inapplicable in this case. But this can’t
help Huang. If her claim is time-barred in Taiwan, it
is time-barred in California because, as we know, the
California courts would apply the Taiwanese limitations
period to a tort claim by a Taiwanese injured in Taiwan.
So even if, as she fears, something in Taiwan’s statute
of limitations will bar her claim if she is shunted to
a Taiwanese court, that something would be applied by
a California court to bar a suit in California.
We can imagine a case in which the court chosen by
the plaintiff has a longer statute of limitations than
the court preferred by the defendant and would not
apply the other jurisdiction’s shorter statute. Then dis-
missal on grounds of forum non conveniens would be
tantamount to dismissal on the merits, and if so it would
matter what the thinking behind the shorter statute of
limitations was. Suppose it was purely procedural
or institutional—the jurisdiction with the shorter limita-
tions period lacked confidence that its courts could
handle stale evidence but this misgiving was not shared
by the court in which the plaintiff had sued. Then no
jurisdiction’s policy would be served by sending the
plaintiff to a court in which his case would be doomed.
This case is different because the shorter statute (shorter
16 Nos. 09-2280, 09-3020
because the statute of repose caps the conventional
statute of limitations that begins to run upon discovery)
expresses a substantive policy that the plaintiff is trying
to avoid. Refusing to invoke forum non conveniens
would give the plaintiff a gratuitous substantive advan-
tage. Convenience favors Taiwan and the statute of limita-
tions applicable to this suit will be the same whether
the case is tried there or in California.
A FFIRMED.
3-26-10