United States Court of Appeals

Fifth Circuit



## FILED

April 4, 2003

Charles R. Fulbruge III

Clerk 

## In the



# United States Court of Appeals

for the Fifth Circuit

_______________



### m 01-41161

_______________



### M ARIA 

### O. V ASQUEZ



### , ET AL



### .,

Plaintiffs-Appellants,



### A LEJANDRA 

### M ARLEN 

### R. D ELUNA



### ,

Intervenor Plaintiff-Appellant,

VERSUS



### B RIDGESTONE 

### /F IRESTONE



### , I NC



### ., ET AL



### .,

Defendants-Inervenor

Defendants- Appellees.

* * * * * * * * * * * * * * * * * * *2 _______________



### m 02-40053

_______________



### M ARIA 

### O. V ASQUEZ



### , ET AL



### .,

Plaintiffs-Appellants,



### A LEJANDRA 

### M ARLEN 

### R. D ELUNA



### ,

Intervenor Plaintiff-Appellant,



### D ANA 

### R. A LLISON



### , ET AL



### .,

Appellants,

VERSUS



### B RIDGESTONE 

### /F IRESTONE



### , I NC



### ., ET AL



### .

Defendants-Appellees,

_________________________

Appeals from the United States District Court

for the Eastern District of Texas

_________________________

Before G ARWOOD , S MITH , and B ARKSDALE

, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Car crash victims’ survivors su ed the ti re manufacturer and other defendants in state

court. After defendants removed to federal

court, the district court dismissed on grounds

of forum non conveniens (“f. n .c.”), finding

Mexico to be the more convenient forum. The

court a l so enjoined plaint iffs from pursuing3

an y claim against defendants in Texas state

court or federal court. We vacate the f.n.c.

dismissal so that a return ju risdiction clause

may be added, and we order that the injunction

be modified to conform to the Anti-Injunction

Act , 28 U.S.C. § 2283. The dismissal and

injunction are otherwise free of error.

I.

Th i s action arises from an automobile accident in the state o f Nuevo Leon, Mexico,

that killed six passengers, all Mexican citizens.

Plaint iffs and intervenors, who are family

members of the deced ent s, allege that the

vehicle and one of its tires were defective, that

the vehicle was impr o perly maintained, and

that the driver was careless. Plaintiffs first

filed wron g ful death and survival claims

against defendants Bridgestone/Firestone, Inc.

(“Bridgestone”), General Motors Corporati on

(“General Motors”), Lucent Technologies,

Inc., and Lucent Technologies Maquiladoras,

Inc., 1 in federal distric t court in Brownsville,

Texas (“ Vasquez I

”). That suit was dismissed

for lack of diversity jurisdiction.

The instant case (“ Vasquez II ”) was filed in

Orange County, Texas, and removed to federal

district court in Beaumont, Texas. That court

dismissed on grounds of f.n.c., concluding that

the dispu t e should be heard in Mexico. The

location of the accident, the sources of proof,

plaintiffs’ home, and the lack of local interest

were factor s t hat the court found favored

M exico . The court also determined that

Mexica n law would govern. The court dismissed wit h prejudice, noting in its

memorandum opinion that “[a] judgment of

dismissal under for um non conveniens h ere should act to preclude a future lawsuit brought

elsewhere in this country.”

Before the c o urt dismissed V asquez II

, plaint iffs filed a separate state court suit in

Cameron County, Texas (“ Vasquez III ”).

They init ially were represented by different

counsel before the dismissal of Vasquez II ; at

that time, counsel of record filed an amended

petition and a petition in intervention on plaint iffs’ behalf. V

asquez III was removed to federal court and ult imately dismissed by stipulation. 2

Following the f.n.c. dismissal in Vasquez II

, pl aintiffs also sued in Webb County, Texas.

T his suit, V

asquez IV

, named five defendants

not named in the three previous suits:

Bridgestone Corporati on, Brid g estone/Firestone de Mexico, S.A., Rudolph Miles and

Sons, Inc., Dicex Interna t io nal, Inc., and the

driver of the vehicle, Villanueva. V asquez IV

also included two new plaint iffs, the parents of

one of the deceased crash victims, Ivonne

Juarez. After defendants removed V asquez IV

to federal court, the Vasquez II court sua

sponte issued a temporary restraining order

barring plaintiffs and their attorneys from arguing their pending motion to remand and

from prosecuting any new suits.

The Vasquez II court later issued a

permanent injunction that prohibited

plaint iffs, their attorneys, their agents,

and all persons acting on behalf of plaint iffs, or in concert with any and all of the

plaint iffs or their attorney s from

prosecuting, filing, or pursuing any suit

1 Lucent Technologies, Inc., and Lucent

Technologies Maqui ladoras, Inc., have since settled

and are no longer parties to this appeal. 2 The Vasquez II court found that V asquez III

was “an attempt by the Plaintiffs to relitigate this

case.”4

or case or cause of act io n against the

defendants herein in any district court of

the State o f Texas, and any United

States District Court in the State of Texas against the said movants.

The court reasoned that the All Writs Act, 28

U.S.C. § 1651(a), permitt ed it to protect the

finality of its f.n.c. dismissal. Plaintiffs argue

that the injunction violates the Anti-Injunction

Act, specifically that it does not fall under the

Act’s relitigation exception. This appeal consolidates plaint iffs’ challenge to the Vasquez II

cour t ’s dismissal and the permanent injunction.

II.

Federal courts apply the federal version of

f.n.c. in resolving a motion t o dismiss where

the alternative forum is a foreign tribunal. D e

Aguilar v. Boeing Co.

, 11 F.3d 55, 58 (5th

Cir. 1993). We review an f.n.c. d ismissal for

abuse of discretion. G onzalez v. Chry sler

Corp.

, 301 F.3d 37 7, 379 (5th Ci r. 2002),

petition for cert. filed

, 71 U.S.L.W. 3489 (Jan.

7, 2003) (No. 02-1044). To obtain an f.n.c.

dismissal, a party must demonstrate (1) the

existence of an available and adequate

alternative forum and (2) that the balance of

relevant pr ivate and public interest factors

favor dismissal. A lpine View Co. v. Atlas

Copco AB

, 205 F.3 d 208, 221-22 (5th Ci r.

2000). Under federal f.n.c. principles, the

court properl y found that Mexico is the more

convenient forum.

A.

An alternative forum is considered available

if the entire case and all parties can come

within it s jurisdiction. 3 The district court found that defendants’ stipulation to submit to

a Mexica n co urt’s jurisdiction in the state of

Nuevo Leon made Mexico an available forum.

Plaint iffs now argue that because Mexican fede ral law provides greater damages than do e s

the law of

Nuevo Leon, defendants should

have been r equired to submit to the jurisdiction of a Mexican federal court in Mexico

City. Forum availability and adequacy are separate inquiries, however , so we rej ect

plaint iffs’ attempt to bootstrap the two.

Indeed, p laintiffs do not dispute that an

available Mexican forum exists in the courts of

Nuevo Leon.

An alternative forum i s adequate if “the

parties will not be deprived of all remedies or

treated unfairly, even though they may not enjoy the same benefits as they might receive in

an A merican court.” G onzalez

, 301 F.3d at

379-80 (citation and internal quotation marks

omitted). In Gonzalez

, we rejected the

plaintiffs’ contenti on that a forei gn

jurisdiction’s decision to limit damages and

limit the availabilit

y of strict liabilit

y 

### SS even to

the point at which the lawsuit ceases to

beco me econo mically viable 

### SS somehow

renders that jurisdiction inadequate. I d

. at

381. Importantly, G onzalez also involved

Mexican plaint iffs s uing an American vehicle

manufacturer over a car accident in Mexico.

Id. at 383. The fact that Mexico provides a

wrongful death c a use of action, albeit with

severe damage caps, 4 makes the count r y an

3 In re Air Crash Disaster Near New Orleans,

La. on July 9, 1982

, 821 F.2d 1147, 1165 (5th Cir.

(continued...) 3 (...continued)

1987) (en banc), vacated on other groun ds sub

nom. Pan Am. World Airways, Inc. v. Lopez , 490

U.S. 1032 (1989).

4 Defendants’ expert stated that Nuevo Leon

law limits wrongful death liability to approximately

(continued...)5

adequate forum. P iper Aircraft Co. v. Reyno

, 454 U.S. 235, 255 (1981).

B.

Once a court determines that there is an adequate alternative forum, it must balance the

relevant private and public interest factors. I d.

at 254-55. Private interest factors include

the relative ease of access to sources of

proof; the availabilit

y of compulsory

process for attendance of unwilling, and

the cost of obt aining attendance of

willing, witnesses; the possibility of view

of premises, if view woul d be

appropriate to the action; and a ll other

practical pro blems that make trial of a

case easy, expeditious and inexpensive.

McLennan v. Am. Eurocopter Corp., Inc.

, 245

F.3d 403, 424 (5th Cir. 2001) (in ternal

q uotati on marks and citation omitted). In

Piper

, the Court stated that “there is ordinarily

a strong presumption in favor of the plaint iff’s

choice of forum, which may be overcome only

when the privat e and public factors clearly

point towards trial

in t he alternative forum.”

454 U.S. at 255. Sti l l , the di stri ct court

det ermined, consistently with P iper

, that

because plaint iffs are residents of a foreign

country, their forum choice should be

accorded less deference. Id. at 255-56.

Plaint iffs contend the court erred, because

a treaty between the United Sta tes and

Mexico, the International Covenant of Civil

and Political Rights, entitles Mexican plaint iffs

to the same deference as American citizens, only with the understanding that suing in the

United States may be less convenient. 5 Article

14(1) of the treaty states, inter alia : “All persons shall be equal before the courts and tribunals. In the determination of . . . rights and

obligations in a s uit at law, everyone shall be

entitled to a fair and public heari ng by a

c ompetent, independent, and i m parti al

tribunal.” 6 We need no t decide this issue,

howev e r, because the private and public

factors “clearly point towards” trial in

Mexico. 7 Piper , 454 U.S. at 255.

Analyzing the private factors, the court correctly determined that trial should be held in

Mexico. The court emphasized that plaintiffs,

the driver of the vehicle, and all decedents are

Mexican citizens. In addition, the vehicle and

tires were manufactured, purchased, and main4 (...continued)

$5,700 plus an unspec i fied amount of “moral

damages” designed to compensate for humiliation,

injury to reputation, and mental anguish. 5 Plaintiffs cite In re Br idgestone/Firestone,

Inc. Tires Products Liability Litig.

, 190 F. Supp.

2d 1125, 1136 (S.D. Ind. 2 002), which held that

the Treaty of Peace, Friendship, N a vigation and

Commerce between the United States and Venezuela gives “e x patriate U.S. nationals and treaty

nationals residing in their home countries

. . . the

same preference of their choice of forum, with the

consideration that suing in a United States forum

while residing in a foreign country is less likely to

be convenient.” Plaintiffs, however, invoke the

International Covenant on Civil and Political

Rights, a separate treaty, so it is hard to see how In

re Bridgestone/Firestone is relevant.

6 International Covenant on Civil and Political

Rights, Dec. 16, 1966, art. 14(1), 999 U.N.T.S.

171.

7 S ee James v. Gulf Int’l Marine Corp. , 777

F.2d 193, 194 n.2 ( 5th Cir. 1985) (stating that

even where courts have inte rpreted forum-access

treaty provisions broadly, they have “s t ill

dismissed suits where the balance weighs in favor

of another forum”).6

tained in Mexico. The vehicle had a Mexican

owner, and the trip took place ent i rely in

Mexico. All the physical evidence and medical

reports are in Mexico; conducting trial in t he

United States would require the translation of

numerous reports and witness testimony.

Federal courts have no power of com pulsory

proc ess over Mexican citizens, including the

s urviving driver and passenger, police, and

mechanics who serviced and maintained the

vehicle.

Plaint iffs point out that documents relating

to the design and manufacture of the vehicle’s

tires are located in the United States and must

be translated into Spanish. They also aver that

the court’s refusal to permit a dditional

discovery prevented them from demonstrating

the exact role of

General Motors and

Bridgestone in designing and fabricating their

products. 8 Yet, even without the aid of

additional discovery, plaintiffs argued in the

district c o urt that the design information is

located in the United States, so we do not see

how they have been prejudiced. 9 Assuming arguendo that all information relating to the design and manufacture of the

tires and vehicle is located in the United

States, we still find the co urt’s analysis

correct. The tires and vehicle were

manufactured and sold in Mexico; the vehicle’s

servi ci ng records and the dri ver’s

records 

### SS both vital to plaint iffs’ alter n ative

theories of liability 

### SS

are also located there.

C.

Plaint iffs maintain that the court erred i n

applying the relevant public f.n.c. factors,

which are

administrative difficult ies flowing from

court congestion; the local interest in

having localized controv ersies decided

at home; the interest in having the tri al

of a div ersit y case in a forum that is at

home with the law that must govern the

action; t he avoidance of unnecessary

problems in c o nflict of laws, or in the

application of foreign law; and th e

unfairness of burde ning citizens in an

unrelated forum with jury duty.

McLennan

, 24 5 F.3d at 424 (internal

quotati o n marks and citation omitted). The

co urt determined these factors favor trial in

Mexico, because the case would overburden

its already

overcrowded docket, Texas has

little local interest in the o utcom e, and

Mexican law should govern the controversy.

Plaint iffs assert the location of Bridgestone’s main plant in Orange Co unty, Texas, 8 Again, plaintiffs’ reliance on In re Bridgestone /Firestone Tires Products Liability Litig.

, 190 F. Supp. 2d 1125, is problematic. Although,

in that case, the multi-district l itigation court denied the defendant’s motion to dismiss on grounds

of f.n.c., some of the vehicles and tires, unlike the

situation in this case, were manufacture d in the

United States. I

d. at 1139-40. More importantly,

the suit involved traffic accidents in Colombia, not

Mexico; that country’s procedure rules would have

required American deponents to travel there to

rat ify their testimony. I

d. at 1138. Finally, the

court believed that political unrest could make trial

in Colombia difficult. Id. at 1143-44.

9 See HC Gun & Knife Shows, Inc. v. City of

Houston

, 201 F.3d 544, 549 (5th Cir. 2000) (stat-

(continued...) 9 (...continued)

ing that a discovery ruling should be reversed only

if the complai ning party demonstrates that it was

prejudiced by the ruling).7

refutes the court’s conclusion that there is little

local interest. In fact, the plant that plaintiffs

reference is not the company’s principal place

of business, nor does it even pr oduce ti res.

C o nversely, Mexico has an interest in prot ecting its own citizens from defective products acquired in Mexico and causing injury

there. 10

The linchpin of plaint iff’s argument 

### S S that

th e alleged wrongful act was the original design of the vehicle and tires 

### SS reaches back too

far in the accident’s causal chain. Identifying

t he situs of the wrongful conduct a s an

American designer’s drawing board ignores

the production, sale, and alleged failure of the

product, which all occurred in Mexico. If

acc e pted, plaint iffs’ argument would curtail

the rights of foreign go vernments to regulate

their internal economies and threaten to engulf

American courts with foreign claims, Gulf Oil

Corp. v. Gilbert

, 3 30 U.S. 501, 508 (1947).

In addition, plaint iffs’ attempt to place the

alleged wrongful conduct in the United States

ignores their own altern a tive liabilit y theories

that improper maintenance and c areless driving

caused the accident. Plaint iffs are permitted t o plead in the alternativ e. F ED

. R. C IV

. P. 8(e)(2). For purposes of f.n.c., however, they cannot present

only one of their multiple liability theories for

the sole purpose of gaining a favorable forum.

For similar reasons, plaint iffs’ contention

that the court erred in its choice- o f-law

determination is unavailing. 11 A federal court

sitting in diversity applies the conflict-of-laws

rules of the state in which it sits. K laxon Co.

v. Stentor Elec. Mfg. Co.

, 313 U.S. 487, 496

(1941). Texas applies the “most significant relationship” test, Gutierrez v . Collins , 583

S.W.2d 312, 318-19 (Tex. 1979), which considers various contacts: the place where the injury occurred, the place where the injury causing conduct occu rred, the parties’ residence,

and the place where the relati o nship, if any,

between the parties is centered. 12

Even if the design of the tires and vehicles

is characterized as the conduct causing injury,

the aggregate of other specific contacts favors

application of Mexican law. As the court recognized, all the decedents and plaint iffs are citizens of Mexico, the accident and subsequent

investigatio n took place in Mexico, and the

vehicle and tires were manuf actured and

purchased there.

The mo st significant relationship test further requires that the specific contacts be evaluated in light of policy considerations. D uncan v. Cessna Aircraft Co. , 665 S.W.2d 414, 10 See Delgado v. Shell Oil Co.

, 231 F.3d 165,

181 (5th Cir. 2000) (“[T]hose fo r eign countries

[where the plaintiffs hailed from and had suffered

injury] obviously have an interest in protecting the

rights and welfare of their citizens.”); Ka mel v.

Hill-Rom Co.

, 10 8 F.3d 799, 804-05 (7th Cir.

1997) (noting that Indiana residents “have a mere

passing interest” where a foreign plaintiff is injured

in a foreign land); Torreblan ca de Aguilar v.

Boeing Co.

, 806 F. Supp. 139, 144 (E.D. Tex.

1992) (stat ing that Mexico has a “paramount interest” in resolving claims brought by Mexican

plaintiffs arising from an air crash in Mexico that

was investigated by Mexican authorities). 11 We review a court’s choice-of-law

determination de novo. Spence v. Glock, Inc. , 227

F.3d 308, 311 (5th Cir. 2000).

12 R ESTATEMENT (S ECOND ) OF C ONFLICT O F

L AWS § 145 (1971).8

421 (Tex. 1984). These considerations are

(a) the nee ds of the interstate and

int e rnational systems; (b) the relevant

policies of the forum; (c) the relevant

policies of other interested states and the

relative in terests of those states i n the

determination of the particular is sue;

(d) the protecti on of justified

expectations; (e) the basic po l icies

underlying the particular field of law; (f)

certainty, predictability and uniformity

of result; and (g) ea se in the

determination and application of the law

to be applied.

R ESTATEMENT (S E COND ) OF C ONFLICT OF

L AW S § 6 (1971). A proper choice-of-law

“achieve[s] the best possible accommodation”

of both nations’ policies. Id. cmt. f.

We are m

indful of the disparate levels of

wrongful death d am

ages provided under Texas

and Mexican law and the incen t ive for plaint iffs to sue in the United States. Given that all

decedents and plaintiffs are Mexican, however,

there is little justif

icat ion for applying Texas

law, which seeks to “protect[] the rights of its

citizens to adequate compe n sation.” 13 Were

we to apply Texas law as a means of righting

any perceived i nequities of Mexican law, we

would be undercutting Mexico’s right to

create a hospitable climate for investment. 14 Uniformity, predictability, and accommodat ion

of the competing policies of the two nations

favor applying Mexican law.

D.

There is no guarantee that Nuevo Leon will

remain an available forum or that defendants

will submit to its jurisdiction. A return

jurisdiction clause remedies this con cern by

permitting parties to return to the dismissi n g

court should the lawsuit become impossible in

the foreign forum. The “failure to include a

return jurisdiction clause in an f.n.c. dismissal

constitutes a per se abuse of discretion.” R obinson v. TCI/US West Communications, Inc.

, 117 F.3d 900, 907-08 (5th Cir. 1997). As we

said in In re Air Crash Disaster

, 821 F.2d at

1166:

If the di strict court deci des that the

[public and private intere st factors] favor in a foreign forum, it must finally ensure that a plaint iff can reinstate his suit

i n the alternative forum without undue

inconvenience or preju d ice and that if

the defendant obstructs such

reinstatement in the alter native forum

that th e plaintiff may return to the

American forum.

The court did not include a return jurisdiction

clause in its dismissal order, so we vacate and

remand with instructions that one be added.

13 See Trailways, Inc. v. Clark

, 794 S.W .2d

4 79, 486 (Tex. App. SS

Corpus Christi 1990, wr i t

denied) (emphasis added); s ee also Baird v. Bell

Helicopter Textron

, 491 F. Supp. 1129, 1150-51

(N.D. Tex. 1980).

14 See Gonzalez

, 301 F.3d at 381-8 2 (“In

making this policy choice, the Mexican gov e rnment

(continued...) 14 (...continued)

has resolved a trade-off among t he competing

objectives and costs of tort law, involving interests

of victims, of consumers, of manufacturers, and of

various other economic and cultural values. In

resolving this trade-off, the Mexican people,

through their duly-elected la wmakers, have decided

to limit tort damages. . . .”).9 III.

The district court halted plaint iffs’ “judicial

hopscotch” by invoki ng t he All Writs Act,

which authorizes federal courts “to issue all

writs necessary or appropriate in aid o f their

respective jurisdictions an d agreeabl e to the

usages and principles of law.” 28 U.S.C.

§ 1651. This power dovetails with the relitigation exception to the Anti-Injunction Act,

which, although generally prohibiting federal

courts fro m enjoining state proceedings, permits a court to enjoin a state court “where necessary in aid of its jurisdiction, or to protect or

effectuate its judgments.” 28 U.S.C. § 2283.

The relitigation exception is grounded in

principles of res judicata and collateral estoppel. C hick K am Choo v. Exxon Corp. , 486

U.S. 140, 147 (1988). The test for the

relitigation excep t ion is the same test used to

determine claim pr eclusion or r es judicata :

“(1) the parties in a later action mu st be

iden t ical to (or at least in privity with) the

parties in a prio r action; (2) the judgment in

the prior action must have been rendered by a

co urt of competent jurisdiction; (3) the prio r

ac t ion must have concluded with a final

judgment on the merits; and (4) the same claim

or cause of actio n must be involved in both

suits.” Regions Bank v. Rivet , 224 F.3d 483,

488 (5th Cir. 2000) (internal quotation marks

and citation omitted); N.Y. Life Ins. Co. v.

Gillispi e , 203 F.3d 384, 387 (5th Cir. 2000).

In Next Level Com munications LP v. DSC

Commun i cations Corp.

, 179 F.3d 244, 250

(5th Cir. 1999), we recogn ized that the

relitigation exception also applies where issue

preclusion, or collateral estoppel, exists. 15 The district court so ught to protect i ts f.n.c. dismissal 

### SS a judgmen t 

### SS

so we must decide

whether it is res judicata for purposes of the

relitigation exception.

The permanent injunction prohibited

plaintiffs and counsel from pursuing “any suit

or cause of action against defendants” in any

Texas state or federal co urt. 1 6 The district

court determined that an f.n.c. dismissal is entitled to claim-preclusive effect as a final judgment on the merits, finding also that Texas

s t at e courts would apply the same choice-oflaw rules and “virtually the same” f.n.c. test as

a federal court. We conclude that an f.n.c. dismissal is not a decision on the merits, so we direct the court to modify

it s injunction to prevent plaint iffs from relitigating only the

choice-of-law determination.

Plaint iffs contend the injunction is

inappropriate because defenda nt s failed to

15 “Collateral estoppel exists where: (1) the issue at st a ke is identical to the one involved in the

(continued...) 15 (...continued)

prior action; (2) the issue was actually litigated in

the prior action; (3) the determination of the issue

in the prior action was a necessary part of the judgm ent in that earlier action; and (4) the legal

standard used to assess the issue is the same in

both proceedings.” N

ext Level

, 179 F. 3d at 250

(citations and internal quotation marks omitted).

16 The permanent injunction order broadly forbids plaintiffs from pursuing “any suit or cause of

action” against defendants; only the memorandum

opinion and temporary r estraining order limit relitigation of claims “arisi ng from the August 12,

1999 accident.” Plaintiffs do not attack the

permanent injunction or der on this technicality,

however, so neither will we. S ee Royal Ins. Co. v.

Quinn-L Capital Corp.

, 960 F.2d 1286, 1294 (5th

C ir. 1992) (“We thus reject a ppellants’

construc t ion of the declaratory judgment as

artificial and unnecessarily formalistic.”).10

de mo nstrate imminent harm or the lack of an

adequate remedy. Rondeau v. Mosinee Paper

Corp.

, 422 U.S. 49, 57 (1975) . Plaintiffs argue that pleas of res judicata

, where appropriate, are sufficient to protect the Vasquez

II court’s dismissal. The court’s finding that

Vasquez IV was plaint iffs’ second attem pt to

relitigate its “final judg m ent” was sufficient,

however, to enjoin further litigation. Q uintero

v. Klaveness Ship Lines

, 914 F.2d 717, 721

(5th Cir. 1990); Next Level

, 179 F.3d at 257.

In Q uintero

, 914 F.2d at 720-21, we

affirmed a decision to enforce the principles of

res judicata in the firs t instance by enjoining

state court relitigation of a choice -of-l aw determination. Though we conclude that the injunction impermissibly prohibits plaint iffs from

suing in state court, the district co urt did not

err by invoking the relitigation exception,

wh i ch seeks to prevent the wasteful and

hara ssing revisiting of previously decided

matters.

A.

At least where there is claim preclusion, the

relitigation exception applies only to the actual

parties of the first proceedi n g and those in

privity with them. R ivet

, 224 F.3d at 488.

The permanent

injunct ion designated

“plaint iffs, their attorneys, their agents, and all

persons acting on behalf of plaint i ffs, or in

con cert with any and all of the plaintiffs or

their attorney s,” as well as the moving

defend a nts. V

asquez IV contains two new

plaint iffs 

### SS

the parents of decedent Ivonne

Juarez 

### SS and five new defendants not named in

Vasquez II

.

Privity has been described as nothing more

than a “legal conclu sio n that the relationship

between the one who is a party on the record

and the non-party is sufficiently close to afford application of the principle of preclusion.”

Southwest Airlines, Inc. v. Texas Int’l Airlines,

Inc.

, 546 F.2d 84, 95 (5th Cir. 1977) (citation

omitted). Privity exists where, for example, a

party’s claim is derivative of the original

party’s claim. 17

Ivonne Juarez’s est at e representative, Jessica Juarez, is a party in V asquez II

, but her

parents did not join the litigation until the advent of V

asquez IV

. Given that both seek

wrongful death claims on behalf of Ivonne

Juarez and are represented by t he same

counsel, they are in privity with one another.

Our conclusion is bolstered by the fact that

plaint iffs’ counsel named Juarez’s parents as

parties in two motions filed in Vasquez II ; the

parents also submitted a list of all companies

sued previously to the Vasquez II court. The

co urt’s reference to all parties acting “on behalf of” or “in concert with” plaint iffs means

that Juarez’s parents were among those

properly enjoined.

The five new defendants, on the other hand,

are not proper subjects of the injunction. The

court enjoined suit against o nly the moving

defendants and did not make any findings as to

17 See T errell v. DeConna , 877 F.2d 1267,

1270-73 (5th Cir. 1989) (holding that a wife bringing a los s -of-consortium claim cannot relitigate

issues that had been decided in he r husband’s

personal injury suit); Meador v. Oryz Energy Co.

, 87 F. Supp. 2d 658, 665 (E.D. Tex. 2000) (finding

that where two estate beneficiaries were “in privity

with their common ancestor for a claim belonging

to that ancestor, it follows that they are also in

privity with each other”).11

privity. Quintero

, 914 F.2d at 721. 18 Though

it is arguable that plaint iffs could have sued

these five defendants in the original action, the

relitigation exception, as noted, requires that

the claims actually be litigated in the first proceeding. H

atcher

, 152 F.3d at 544. Even if

the injunct io n otherwise falls within the relitigation exception, its express terms prevent

e njo ining litigation against non- V asquez II

defendants.

B.

An f.n.c. dismissal, based on a doctrine “of

procedure rather than of substance,” Am.

Dredging Co. v. Mille r , 510 U.S. 443, 453

(1994), does not resolve the substantive merits

and therefore falls outside the relitigation exception. 19 In C

hick Kam Choo

, 486 U

. S. at

142-43, a Singapore resident brought marit ime

and Texas state law claims in federal court. In

granti ng defendant’s motion to dismiss on

grounds of f.n.c., the district court found that

Singapore law governed. The court enjoined

the pla i ntiff after she refiled the Texas state

law claim and brought a new claim under Singapore law in Texas state court.

The Supreme Court vacated the injunction

so far as it prohibited litigating the Singapore law claim, noting that the f.n.c. dismissal “did

not reso lve t he merits of this claim.” I d. at

148. In other words, instead of the substantive

merits, “the only issue decided by the District

C ourt was that petitioner’s claims should be

dismissed under th e federal f orum non conveniens doctrine.” Id.

Rule 41(b) states that an order of dismissal

“operate s as an adjudication on the merits”

unless t he court states otherwi se or the di smissal is for lack of jurisdiction, improper venue, or failure to join a party under Rule 19.

F ED

. R. C IV

. P. 41(b). 20 Because an f.n.c.

dismissal involves the court’s “declin[ing] to

exercise its jurisdiction, even though the court

has jurisdiction and venue,” Piper

, 454 U.S. at

250, it does fall under one of the three

exceptions 

### SS

lack of jurisdic t ion, lack of

venue, 21 or failure to join a party. Nor did the

18 See Ha tcher v. Avis Rent-A-Car Sys., Inc.

, 152 F.3d 540, 544 (5th Cir. 1998) (“Since thes e

individuals were not named in the federal court action, no claim against them was actually decided by

the federal court.”).

19 Baris v. Sulpicio Lines, Inc. , 74 F.3d 567,

572-73 (5th Cir.), vacated

, 74 F.3d 575 (1 9 96),

reh’g en banc

, 101 F.3d 367 (1996). The panel

opinion in Baris was vacated; an equally divided en

banc court affirmed the court’s enjoining of reli tigation following the district court’s f.n.c. dismissal. 20 F ED

. R. C IV

. P. 41(b) states:

For failure of the plaintiff to prosecute or

to comply with these

rules or any order of

court, a defendant may move for dismissal

of an action or of any claim against the

defendant. Unless the court in its order for

dismissal otherwise specifies, a dismissal

under this subdivision and any dismissal not

provided for in this rule, other th a n a

dismissal fo r lack of jurisdiction, for

improper venue, or for failure to join a party

under Rule

19, operates as an adjudication

upon the merits.

21 Although the Court has observed that f.n.c. is

a “supervening venue provision,” Am. Dre dging

, 510 U.S. at 453, there is a long-standing distinction

between a 28 U.S.C. § 1404(a) f.n.c. transfer and

an “improper forum, ” Tel-Phonic Servs. v. TBS

Int’l, I nc. , 975 F.2d 1134, 1141 (5th Cir. 1992).

Thi s, we feel, warrants a distinction between an

(continued...)12

district court state that the dismissal was

involuntary; the court instead stated that by

dismissing with prejudic e, i t sought to

preclude plaint iffs from relitigating their claims

“elsewhere in this country.”

Previously, rule 41(b)’s effect regarding

claim preclusion was quest io ned because of

the limit ed enumerated exceptions to its

default rule that judgments genera lly be

deemed “on the merits.” 18 C HARLES A LAN

W RIGHT ET AL

., F E DERAL P RACTICE AND

P ROCED U RE § 4435, at 140 (2d ed. 2002).

Many types of dismissals “do not seem to fall

within the categories ‘provided for in this rule’

and yet clearly sh ould not 

### SS a nd do

not 

### SS operate as an adjudication that precludes

a second action on the sam e claim.” I

d.

In Semtek Int’l, Inc . v. Lockheed Martin

Corp.

, 531 U.S. 497 (2001), the Court reigned

in rule 41(b) as a

determinant of claimpreclusion, reco gnizing that the meaning of

“judg m ent on the merits” has changed over

t ime and “has come to be applied to so me

judgments ” (like the instant district court’s

f.n.c. dismissal) “that do no t pass upon the

merits of a claim and hence do not (in many

jurisdictions) entail claim-preclusive ef fect.”

I d. at 502. The Court determined that rule

41(b) primarily “relates to the dismissing court

itself.” That is, an “adjudication on the merits”

bars refiling of the same claim in the same

court but does not establish claim preclusion.

Id. at 505-06. S emtek held that when a

diversity court dismisses a clai m on state

substantive law grounds, the preclusive effect

of the judgment is measured not by rule 41(b), but by the preclusion law of the state in which

the court sits.

T he district court, although exercising d i

versity jurisdiction, dismissed on federal procedural grounds, thus distin guishing S emtek

. And despite rule 41(b)’s enabling the court to

prevent relitigatio n of federal f.n.c. principles

in a Texas federal court, 22 w e cannot, after

Semtek

, look to th e rule as a gui de to the

judgment’s claim-preclusive effect elsewhere.

Semtek states that rule 41(b) “would be a highly peculiar context in which to announce a federally prescribed rule on the complex question

of claim preclusion, saying in effect, ‘All

federal dismissals (with three specified

exceptions) preclude suit elsewhere, unless the

court otherwise specifies.’” Id. at 503. Also,

permitting a rule of civil procedure to control

the effect given a federal j udgment by a state

court arguably violates the jurisdictional limitation of the Rules Enabling Act. 23 Id.

Instead, we lo o k to the longstanding rule

that “federal common law governs the claimpreclusive effect of a dismissal by a federal

court sitting in diversity.” Id. at 508 (citation

omitted) . Fortunately, C hick Kam Choo

,

21 (...continued)

f.n.c. dismissal and an “improper venue” dismissal. 22 Our statement in Quintero that an f.n.c. dismissal may be designated “‘with prejudice,’ so long

as the plaintiff’s ability to reinstate the action is

otherwise adequately protected,” means only that a

court may prevent relitigation of the federal f.n.c.

issue. 914 F.2d at 722. So far as Q uintero may

be read as permitting an f.n.c. dismissal to be

afforded a broader preclusive effect, that case dealt

only with an injunction barring relitigation of a

choice-of-law determination, so it is dictum

. Id.

23 The Rules Enabling Act states that the rules

“shall not abridge, enlarge or modify any

substantive right.” 28 U.S.C. § 2072(b).13

which makes no me nt ion of rule 41, reveals

that an f.n.c. dismissal is not a claim-preclusive

judgment.

Chick Kam Choo characterizes a dismissal

based on federal f.n.c. principles as one not resolving the underlying substantive issues. 486

U.S. at 148. The principle of f.n.c., as “nothing more or less than a supervening venue provision,” Am. Dredging

, 510 U.S. at 453,

contemplates resolvin g t he merits in another

forum, negating the possibility of claimpreclusion. Although an f.n.c. dismissal designated on the merits may bar reconsideration of

the claims in another Texas fede ral court, 2 4 it

cannot forever bar the controversy from all

American courts. To concl ude otherwi se

would prevent states from decidi ng the

openness of their courts. 25

Defendants seek to distinguish Chick Kam

Choo because Texas f.n.c. law has changed; they argue that toda y Texas would apply the

s ame or even a less deferential standard than

the federal f.n.c. st andard, perm itti ng

application of the relitigation ex c eption. In

contrast to the situation in Semtek

, where the

dismissal’s preclusive effect was dictated by

state preclusion law

, defe ndants seek to have

the preclusive effect of the f.n.c. dismissal turn

on differences between federal and state f.n.c.

law.

This would have the undes irable effect of

varying the preclusive effect accorded a federal

f.n.c. dismissal

based on the law of the int erpreting state. Instead, the type of federal

common law applied to a federal proc edural

dismissal, unlike a dismissal based on state

substan t ive law, does not incorporate state

law. C hick Kam Choo

, 531 U.S. at 508

. T he

threats of “forum-sh opping . . . and . . .

inequitable administration of the laws” that

Erie s eeks to avoid, Hanna v. Plumer

, 380

U.S. 460, 468 (1965), are non-existent where

a di smissal is based on federal procedure.

Chick Kam Choo ’s observation regarding the

differ ences between the Texas “open courts”

policy and federal f.n.c. law serve s only to

emphasize the likelihood of a different result in

state court.

C.

Whereas the f.n.c. dismissal did not decide

the substantive merits of plaint iffs’ claims, the

court’s choice of Mexican law did. This is

somewhat counter-intuitive, given that a

choice-of-law determination is a necessary part

of an f.n.c. dismissal. P iper

, 454 U.S. at 245.

The result is that plaint iffs are not barred from

pursuing their claim s in Texas state court so

long as they bring only Mexican law claims.

Key to Chick Kam Choo’s reasoning is that

a choice-of-la w determination made in 24 Even where a court ent ers a final f.n.c. dismissal, it may reconsider the issue i f there is a

change in the material facts underlying the

judgment. Exxon Corp. v. Chick Kam Choo

, 817

F.3d 307, 312 (5th Cir. 1987), r ev’d on other

grounds , 486 U.S. 140 (1988).

25 Chick Kam Choo

, 486 U.S. at 148-49

(“Federal forum non conveniens principles simply

cannot determine whether Te xas courts, which

operate under a broad “open-courts” ma ndate,

would consider themselves an appropriate forum

for petitioner’s lawsuit . .

. . [W]hether the Texas

state court s are an appropriate forum for

petitioner’s Singapore law claims has not yet been

litigated.”); see also Picco v. Global Marine

Drilling Co.

, 900 F.2d 846, 848 (5th Cir. 1990)

(“[ Chick Kam Choo ] held that a federal forum non

conveniens dismissa l was not p er se necessarily

res judicata of the appropriateness of state courts

as a forum for the same litigation . . . .”).14

furtherance of an f.n.c. dismissal is a decision

on the merits. Regarding the Texas law claims

previ o usly dismissed in federal court on

grounds of f.n.c., Chick Kam Choo stated that

the “validity of the cl aim was adjudicated”

once the lower court determined that

S ingapore law governed. C hick Kam Choo

, 48 6 U.S. at 150. In other words, the di stri ct

co urt ’s choice-of-law determination

“necessarily precludes the application of Texas

law, [so] an in

junction preventing relitigation

of that issue in state court is within the scope

of the reli

t igation exception to the AntiInjunction Act.” 26 I

d. ; see also Quintero

, 914

F.2d at 722.

Following the reasoning of C hick Kam

Choo

, the district court’s decision to apply

Mexican law adjudicated plaint iffs’ Texas law

claims. Even if the other f.n.c. factors were

found to favor Texas over Mexico, plaint iffs’

Texas law cl aims would be unsustainable in

light of the court’s adverse choice-of-law determination. As the district court observed, it

actually rendered two judgments: (1) Mexican

law governs the controversy; and (2) the f.n.c.

f actors favor dismissal and trial in Mexi co.

Under Chick Kam Choo

, only the former is a

decision on the merits.

Even if a choice-of-law determination were

not considered a judgment separate from the

f.n.c. dismissal, issue preclusion would make it

a proper subject of the relitigation excep tion.

Next Level

, 179 F.3d at 249-50. The choiceof-law issue was “distinctly put in issue,

litigated, and determined in the former action.”

Brister v. A.W.I., Inc.

, 946 F.2d 350, 354 (5th

Cir. 1991) (citation omitted) . As noted,

federal courts apply the same choice-of-law

analysis as the state in which they sit. K laxon

, 313 U.S. at 497. Also, issue preclusion does

not require that the accompanying

judgment 

### SS

in this case the f.n.c. dismissal 

### SS be

adjudicated on the meri

ts. A cree v. Air Line

Pilots Ass’n

, 390 F.2d 199, 203 (5th Cir.

1968). Consistent, however, with C hick Kam

Choo

, our finding that the choice-of-law determination actually adjudicated the Texas state

law claims, thereby trigger ing claim preclusio n,

prevents applicat io n of the injunction beyond

the plaintiffs and those in privity. 27

For the foregoing reasons, we VACATE

t he f.n.c. dismissal and permanent injunctio n

and REMAND with instruction to add a return

jurisdiction clause to the judgment and modify

the injunction enjoining plaint iffs fro m relitigating the cour t’s choi

ce-of-law determination.

26 In maritime

cases, choice-of-law is a

determination on the merits and may be treated as

the equivalent of a motion for summary judgment.

Quintero

, 914 F.2d at 721; Nunez-Lozano v.

Rederi

, 634 F.2d 135, 137 (5th Cir. Unit A 1980).

No reason comes to mind for limiting this principle

to maritime cases. 27 Unlike claim pre clusion, collateral estoppel

does not always require complete identification of

parties. Next Level

, 179 F.3d at 255-56; Meza v.

Gen. Battery Corp.

, 908 F.2d 1262, 1273 (5th Cir.

1990).