to sign to somebody else i don't because if you're if you're if you're judgment creditor then it seems to me that you that you stand in the shoes of of of the whose debt you  use debt you're trying to collect well that's simply not supported by the authorities there are there is likewise no authority that supports the notion you admit your judgment creditor we are a judgment creditor pursuant to your not like a rd party beneficiary you're not you're not an ethically know if we were we would be bound by that provision the fact that we derive our rights from a statute to qualify with a judgment creditor have have broader rights than a than a beneficiary or stands in the shoes of the actual smart of the insured for purposes of foreign selection clause or for any purpose whatsoever greenport seems to have been explicit in saying look we're not going to establish lack that are rules there just too many competing factors and so you've got to look at the facts of each case and one of the things that for me speaks to this case mean in some cases the parties are trying to say look i shouldn't be bound by this form selection clause i'm not invoking the contract i'm not trying to get the benefit of anything in this case your trying to get the benefit of the insurance policy no because if you if you don't you can't collect anything you've got a judgment against presumably insolvent parties so you're trying to say this insurance policies affect  we want to get the benefit of it but we don't want to be bound by provisions that are within that policy which i don't understand why you can pick and choose well because that's consistent with the manner in which the stand in the shoes and likewise i think even more significantly in the olds case the court held that a statute of limitations that was contained in the insurance policy a one year statute of limitations to pursue the judgment claim that you had you're not bound by that you're not bound by that statue of limitations because your claim is based upon the statute not the go ahead i'm and eighty and i know there's a whole argument that's been raised with regard to whether it applies because of and at some point may want to address how this policy was issued order livered within the state of california but i'm direct action against the ensure on the policy and subject to its terms and limitations correct i don't see anything there that says it's not subject to the terms and limitations or that you're allowed to bring that policy that lawsuit where you want it while you're allowed to bring it in california is our business you know it would so it so point to be the language in this statute that says that you have to be allowed to bring it in california there's the sex you clearly does not say and they say is that correct so why isn't that a problem well it's a problem because of the policies that have been addressed have been about right dress by california and by this court in that has evolved around eleven thousand five hundred and eighty is uniform that a that a provision can't be written into an insurance policy that modifies it or even the lays it for example well let me put it this way you're on that i don't believe that liberty mutual could've written a part written a provision in this policy that said if a interparty gets a judgment against you and that injured party brings an action against us as a judgment creditor we have the right to retry whether there was liability and the amount of damages we have the right to do that the question will they be able to have written that in this policy and i believe the answer's no they can't good would be that's fundamentally unfair the substance of that is unfair the yes and there's california law that makes a point and law from lots of jurisdictions that make that point but your problem here that you are required is to accept as a premise that in this case a forum selection clause attached to a choice of law clause should be deemed fundamentally unfair the statute doesn't say that so you've got to get to it and can get to it if in fact that premise is correct but i don't see how the statute establishes that premise is correct it takes more than that well why isn't why isn't your argument that that that on a policy to be  any other insurance company if you if you sell a policy to a california insured you're going to be regulated in the context of that policy you're going to be highly regulated and the courts have said in the context if you intend  to renew you have to give sixty days notice and if they don't there's and that and they can't waive that seventy eight maybe maybe it may be a constraint on the whether this policy actually expired on august th two thousand and fourteen at the question that i've got is would would california six hundred and seventy eight dollars be considered in any litigation in australia and why aren't the australian courts as capable of deciding whether whether liberty mutual is bound by california law as a california court could decide well i know that you had you had some experts on both sides testify about australia law and there's an australian law that is somewhat similar to california's but doesn't seem to provide the same doesn't seem to provide a remedy doesn't say what happens if you don't get diving was fourteen or fifteen days notice and it and it doesn't apply if a replacement policy why wouldn't care why would an australian court feel that in this question i'm going to ask opposing counsel why wouldn't australian court feel bound to say well when you wrote this policy in california you were subject to california's rules and we will at least apply six seventy eight whatever else will do and in australia as to under australian rules where we will we will have to we will have to look to the law of california that regulated the in the writing of insurance in california even though the form selection clause and the choice of law is here it s seemed to stretch a huge stretch i don't think the liberty mutual be so interested in getting to australia if they thought that was even a possibility there was that the choice of law we get asked to apply for a law frequently the but the choice asked even more frequently but they'd be looking at a policy that had both or choice most as form selection clause and a choice of law provision and under and they already do you do know what what what australia's choice of hers it all honors the choice of law provision there but that but that doesn't that doesn't tell you i don't i'm not sure that that answers the question i don't think we can say for that nobody can say for certain what an australian court would do because that it certainly it certainly well i mean you had you you took some expert witness on this you had expert you had a couple of you had a couple of statements issued by australian lawyers correct and unrefuted that the that the australian law is significantly different  same level of protection and there's the choice of law provision in the contract there's every reason to believe that they would apply that and it relates back to one hundred and fifteen dollars a day to go back to when what you think might be a weak argument but but having to go to where this case belongs it's got to be richer than that i mean we're not talking and i don't need to disparage any country now but we're not talking and i don't know north korea ours in bob way or something australia has got a very highly regarded legal system that derives from the same legal system than ours does it may not adopt all of california's policies it will consider i would presume would consider what california has enacted and to the extent that california code applies would consider that but i'm not sure telling me that our prospects of succeeding in australia aren't as good or california is banned is more toward what we want as a result i don't think that explains why this case needs to be litigated here and can't be litigated in australia why does california get to tell the whole world what to do and why doesn't california adopt something that says if you cover a claim brought by a california resident and you choose to be registered to do business in california and then you have to accept a california court it could say that but it doesn't this court in the haste in case and eighty the state has a manifest interest in providing its residents with a form the state has a manifest interest in providing but but california can't provide a forum in australia be hindered in any way we submit that having to facing a change of venue does exactly that and my point is california can't provide cannot provide a forum in australia this court says that's exactly what eleven thousand five hundred and eighty does it's a venue statute we have we california have a manifest interest in providing a form that's a far different suggestion that maybe you can go to australia and maybe you can  even pursue your rights as a judgment creditor they don't even have my recall correctly that heyst it was a personal jurisdiction case that that is a mystery of all due respect you're on that is a misreading of haste and that's what the liberty mutual has continued to maintain haste in was a personal jurisdiction it dealt specifically separately and said it had to efface separately the eleven thousand five hundred and eighty dollars claim on its own and the constitutional the and so it's sort of irrelevant whether it was just about personal injury because they talked about the important public policies to give injured victims a remedy a strong state interest in regulating insurance than volves lives and limbs of the public and ensuring the tort victims are able to reach insurers and and finally in just a few seconds i have left i would like to suggest that the guidance this court recently received from the california supreme court on pitts or so should inform the manner in which it analyzes the public policy importance and significance of both  i'd like to start really where this discussion in least in our view should be framed and that should be framed by the supreme court's decision in brennan and it's progeny that talk about the deference that federal courts give form selection clauses and when you go back and you read those cases it's a recognition that companies are engaging in much more international business there's going to be a need for certainty and predictability in connection with those contracts and some of those are contracts where parties are negotiating and can reach agreement and in those contexts it's very difficult to set aside a form selection clause we're dealing here with somebody who's not a party to the contract and is told ok you've got a claim sort of unremarkable i've been injured no real dispute it appears about the fact of a serious injury and they discover there isn't sure it's not a huge surprise only the insurance requires them for this product they bought at their local store someplace i think sonoma county that they're expected to go like eight thousand miles away to australia especially ironic given that the insurance company is a company incorporated in delaware headquartered in massachusetts and they use a statue of liberty is that symbol then that seem odd to you it doesn't your honor if you go back and look at the factual premise of all this actually the liberty entity that negotiated this contract was an australian and and it was dealing with the parent of eco smart eco smart was the california company i say liberty mutual insurance company here that's the defendant it's apparently not even separately incorporated  want it was the australian entity of liberty mutual selling a policy to a company called the fire company the fire company was the parent company of eco smart is it australia correct we know what proportion of its business was within the united states well i don't know specifically you want to but i know that the policy covered the fire company all of its subsidiaries and geographically covered the united states canada and australia and so those and had separate policy provisions and limits for north american origin claims in the nd policy runner because what happened was there was a negotiation between the australian entity and the fire company the corporate parent of eco smart and they were negotiating the new policy and liberty the australian entity decided we want to reduce our level of risk in particular with respect to these products that don't have flame arrestors and so the parties negotiated that became a discussion about premiums and scope of risk and there was a limitation on the scope of coverage that went into the nd policy the parties agreed to that all the premiums were set based upon that and then for almost forty days later is when the accident happened to the plaintiffs so with this pilot with this policy written to ethel smart it was written to the fire company it was written to the fire company eco smart was listed as one of the insurance as was all of the fire company subsidiaries in australia canada and in the united states so does six of the point one have any relevance to the writing of this insurance policy the way that i would say that your honor there is a difference in australian law and california law with respect to the amount of notice you have to give o material change in a policy in california six hundred and seventy eight dollars talks about sixty days notice in australia it's a fourteen day notice period but the statutes operate generally the same you have to give that notice or otherwise california provides a remedy and australia doesn't my initial story doesn't tell you what happens if you don't if you don't give it the notice you want of that wasn't my understanding my understanding is that it operates very similarly to the california if you don't give notice  would have two opportunities they could bring this claim directly under the australian statute in their papers in front of the district court as well as in front of this court they argue that only seventy two hours notice was given well if if that's what they believe the facts are they could take that claim in our group before the australian court that that liberty has violated the notice provision and take advantage of that they could also argue that the choice of law provision should move in favor of california law and it's my understanding that that is a claim that they would also consider and adjudicate in australia it's my recollection your honor that the district court did not apply in on the choice of law here or the court only limited his ruling to the form select selection cost so it might be saying they would have the ability to make that argument in australia i want to go back to parts of a section fifty eight dollars of the australian the australian code so you get the fourteen days and if you fail to comply with the fourteen days then the end of the original contract still applies that's my understand how long does that apply i do not know that i would want to make it was that there are sixty days in that in the california statute i don't see any limitation in the australian steps in the limited by resolve whether there was a some kind of a conflict between fifty eight dollars sixty seven cents correct and they would presumably your honor they would look at traditional choice of law factors they would look at where they believe the policy was issued and delivered you know it's our position as we argued in front of the district court that the policy was issued and delivered all in australia and if you look at the policy itself it was expressed in australian dollars it's trading currency so it is our view and delivered to the fire companies broker in australia is the fire company insolvent it's my understanding that they are not and it's also my understanding that the plaintiffs could have an opportunity to move against them for the judgment that they acquired against theirs subsidiary but i don't i don't know that they've done that and i looked and i thought i saw something that was reported that the judgment included the fire company and i did not believe that they were insolvent you and i thought that the bankruptcy included only echo smart so do is is there any question as to whether the statue of limitations has run in australia i don't believe it has your honor and does the prior judgement old appears to be the sort of in the nature of an of a of a declaratory judgment was prior previously obtained in australia does that have collateral stoppel effect here my understanding is that it's not that was only against the fire company and it's my recollection that there was a consent decree issued so if the plaintiffs were to go to australia and were to argue what they argued in front of the district court and organ in front of this court that there was insufficient notice given they would be able to present those arguments and those claims and the court would you to keep those i would like to go back to the question that the panel asked about six hundred and seventy eight point one and it starts with that with the premise that the supreme court has clearly articulated the deference that's paid to form selection clauses we don't believe you want to respectively that our policy contravenes california law in any way because california law really just provides an avenue for relief that avenue of relief in australia the six hundred and seventy eight point one provision although it's in there there is no it's not in the statute it's not in any judicial the decision that suggest you can't waive that statute or that is a strong or compelling fundamental aspect of california public policy and if you think about it from an international contract it sure does make sense that two australian parties contracting would want to understand what the notice provision is so that they could understand when they need to change or move to another insurance carrier the whole purpose behind sixty point one is not so much for the plaintiffs here it's really about direct insureds so that you have some notice decision or statute that i'm aware of that says that sixty eight point one can't be waived right or says six hundred and one point one is a fundamental policy of california law so my point is that when you're thinking about an international contract and one of the important things is notice of policy changes while the parties here are agreed on the australian law applying so fourteen days is what everyone was operating under now when liberty gave notice to the fire company that we're going to make a change because we don't want to insure these risks when the fire company had some options right they could go to another carrier they could pay more premiums to get that coverage they could pull the products from certain markets instead they moved forward and i think the issue from our perspective here is that with the plaintiffs are trying to do is they're trying to improve their positioning over the direct insurance the plaintiffs here are our judgment creditors there have derivative rights they have to accept the terms and limitations as described in one hundred and fifteen zero well one of those terms is the form selection clause one of the terms is what's going to apply australian law is going to apply now that the plaintiffs can go to australia and litigate all of that but your honor i accept your premise that has been my experience that australian courts have great due process and that was the whole reason for the supreme court saying no longer as are we as a nation going to say that we could only get justice here in our that we have to adopt to the reality of the world that these are going to be international contracts this is an international contract the plaintiffs are stepping into the shoes of the director insured here and are limited by their terms and limitations so you're saying that the plaintiffs here have no better rights than the original site or to the contract pursuant two hundred and eleven thousand five hundred and eighty which gives them any right at all your honor that's correct they they have to set the terms and they used the terms and there have been some statutes you know one of the recent cases that came down was that gemini gemini case that looked at an idaho statute that basically said all contracts that are formed and i don't have to have idaho as a form of that's an example of a state saying this is our public policy if you're going to have a contract in idaho it's got to be litigated here california didn't do that california left it open and that's what judge work in the district court decided he said you know look at this you all  was give you an avenue for relief well you've got that avenue of relief and it's in australia and that's where you should pursue it could california an act that was limited to insurance companies are going to register as an insurance company to provide coverage in california or to sell policies in california that you are still obligated to accept a california forum not just for policies that you sell and deliver here but for claims made by california residents so the question is could california enact that policy that would be very similar i think to the idaho policy it would have it's it would have its downsides right because alex kemp policy reasons why california might not want they could do that but if they could then is it meaningful that the state hasn't and acted such a rule i think it is i think it's a recognition that companies in our state are going to be involved in international business there's going to be a need to allow them freedom of agreement and one of those agreements is where this issue's going to be resolved i mean you look at this situation your honor and you have it where you're not only insuring the parent company who's operating in australia you're insuring all of their subsidiaries that could operate anywhere in the united and canada so those are going to be all different laws so the parties say let's have some certainty let's have some a level of confidence in what we're doing so that our relationships can be governed by one document and so they agreed to what they agreed to in the policies what's i think what i think is mistaken in the plaintiff's position here is they've got a judgment against eco smart eco smart was the tortfeasor california gives them an ability to go after the policies effect was smart but they don't acquire any more rights than e one the c e o of eco smarts that he got last minute notice he flew to australia wasn't real happy about that about the changes and that he gets that just within i think just a couple of days of the of the change in the policy the expiration of the policy so you and i know that is the factual assertion that's made that factual assertion is correct then they'll have relief right they could petition for relief in australia we don't believe that those are the facts i understand so putting that aside i would say the answer is no because eco smart is the subsidiary of the fire company the fire company is what balland itself and all of its subsidiaries to that contract my guess is if smart was here we'd be having a very different discussion because it would be well eco smartly or parent right we would be having a different discussion but that it's the same discussion that they're entitled to isnt it right but i think more to they're even more to their detriment because then it would be even clearer the plaintiffs are stepping into the shoes of that was smart eco smart had to comply with the terms and limitations of the policy so did the plaintiffs and one of the terms of the policy is the form selection clause and that's very very right and it's all going to be a little a little circular but as long as if they get to australia they can still raise the six hundred and seventy eight point one question my understanding is they could raise the conflict of law question and seek to apply california law there are limits to the stepping into the policy argument there are certainly cases lots of cases that recognize at some point a result is going to be fair and reasonable so the form selection clause north korea you wouldn't be here today insisting that they got to go to north korea sure so it's illegal to find where the outline is but go back to the facts are related to the very beginning why isn't it unreasonable to expect somebody who buys a product in california product by a company in california or the subsidiary eco smart injured in california encountering now an insolvent manufacturer but discovering there is an insurance policy issued by liberty mutual with the statue of liberty and all those other things why isn't it unreasonable to say you got to go down under halfway around the world to pursue your claim i think it's for adult couple of different reasons this is not a situation where liberty is denying coverage that is a political or trying to get out from under its responsibilities there were two policies here it was the st policy and then the nd policy the nd policy doesn't cover the accident that was incurred by the plaintiffs here so it's libby's position that we don't have a policy we didn't insure that risk that's the key why it's fair to say has because this was a situation where libby sold a policy directly to echo smart libby sold that policy to echo smart's parent which operates in many jurisdictions around the world but with that coast guard is a named insured so it's not like liberty didn't know there was coverage that would be provided here true but there were also coverage for all of the fire companies subsidiaries operating in the united states in australia as well as in canada and so it's i think it's very reasonable in that kind of an international contract for the parties to have some understanding of which of the many jurisdictions that could apply should apply and the party going understanding in a dispute between the parties but if you have coverage which is at least may have been carved out by the nd policy but at least of the time they arrange it was entered into and for some kind of claims in the nd policy as well you know the claims are not going to be broader the dispute isn't going to be with the fire company you know it's going to be with an injured rd party that's the nature of manufacturing coverage and so it's all well and good to say that look we strike this deal we agree with tween us which is all but bremen stalking about that this is where we're going to resolve our disputes it looks very different when you're talking about a claim brought by somebody who's injured in california as opposed to australia but we didn't directly insure the lewises that that might be the case if we directly ensured louis's we directly insured the fire company  claims which you could anticipate would come from rd parties that's the reason for the carve out in the nd policy there had to have been mindful of that's what much of this coverage is we're not simply insuring the fire company for it's own the so what is for fire or damage or hail or whatever else we're providing coverage against claims that will come from injured rd parties for use of your product understand you want to but run in the progeny from bremen kind of recognize that when you have international contracts you're going to have some of these issues and they give deference to a farm selection clause so that at least it honors and respects the choice of the parties what happen defining the parties as the parties to the insurance contract knowing that they're going to be claimants that are one of those partners but those claimants in the ordinary course would not have direct claims against the insurance carrier write their claim would have been against echo smart eco smart got a default a default judgment i believe and then the statute in california gave them a direct action against the insured but the statue in california doesn't say you know what in this situation as a matter of policy you could bring that type of claim in california it only says subject to the terms and limitations this is one of those terms so maybe california if california had that type of a statute maybe we'd be a little bit more like the jem gemini case and idaho but we're not the california was very very clear as the limits of what a plaintiff like the lewises can achieve in this situation i see that i've gone over my time by quite a bit thank you for your patience happy to answer the questions i fire company and spark is i think being way overstated here to make the fire company the insured and everybody else is just sort of hanging out there as the core point of equity part is a named insured so the liberty mutual decided although they decided while they were a company was sitting in australia they decided to insure a california company a california company that's doing business in california is putting a product in the stream of commerce in california that ends up in a retail store in that community of sonoma california residents shop so but do you would you admit that if this policy had been written by liberty mutual directly to echo smart without any intervention by the fire company that was a california company with a california selection clause selection clause and california choice of law but had written a nd policy timely you wouldn't have a cause of action here would you if they'd written the if they'd given the proper no they'd given sixty days notice you timing of the two policies and australia does have a similar a similar statute to california it just is only for limited to fourteen days rather than sixty days the problem with the with the australian statute is it doesn't tell us what happens it tells us that that bad things will happen to the to the insurer to the insurance company to change the policy but it doesn't tell us how it goes which is that that's an open question as they look at the days it could be last and eyestrain court might decide to and seventy eight dollars and say well things you are since you were ensuring that the california company you had to comply with california rules on this that it's a fundamental question but but there's a there's an equally significant distinction between the statutes  california statute says you have to give that notice not only if you intend not to renew but if you intend to substantially reduce the coverages that provision is not in the australian statute and i think that's a that's a significant difference that that  out here and it played up it played out on the ground and this is not just theoretical this was a situation where the fire company the california company was finding itself perhaps uninsured on an uninsured not getting the sixty days notice that they were entitled to in california having to try to scramble and end up ended up getting this policy that was far inferior that under california law would would not have avoided  the the remedy in six hundred and seventy eight point five so there that the statutes are fundamentally different and given the way it played out on the ground here it had a real difference to these injured parties thank you