Source: http://supreme.justia.com/cases/federal/us/494/516/
Timestamp: 2014-08-21 12:09:51
Document Index: 494356153

Matched Legal Cases: ['§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404', '§ 1404']

Ferens v. John Deere Co. :: 494 U.S. 516 (1990) :: Justia US Supreme Court Center Justia.comFind a LawyerLegal AnswersLawMore ▾Justia BlogVerdictLaw Blog DirectoryLegal FormsUS Law US Supreme Court Cases Federal Cases US Constitution US Code Federal RegulationsFederal DocketsState CasesState Codes & StatutesTrademarksPatentsCompany Legal ProfilesMarketing ServicesSign InSearchJustia › US Law › US Case Law › US Supreme Court › Volume 494 › Ferens v. John Deere Co. › Syllabus
Sign up for Justia's FREE Newsletters: Daily Opinion Summaries by Court (covering the U.S. Supreme Court, all Federal Appellate Courts, and the 50 State Supreme Courts), and Weekly Opinion Summaries by Practice Area. Subscribe NowFerens v. John Deere Co.494 U.S. 516 (1990)Annotate this Case
CaseU.S. Supreme CourtFerens v. John Deere Co., 494 U.S. 516 (1990)Ferens v. John Deere Co.No. 88-1512Argued November 6, 1989Decided March 5, 1990494 U.S. 516SyllabusPetitioner husband lost a hand in Pennsylvania when it allegedly became caught in a harvester manufactured by respondent Deere, a Delaware corporation. Petitioners, Pennsylvania residents, delayed taking legal action against Deere until after Pennsylvania's 2-year tort limitations period expired. In the third year, they filed proper diversity suits (1) in a Federal District Court in Pennsylvania, raising contract and warranty claims as to which the applicable Pennsylvania limitations period had not yet run, and (2) in a Federal District Court in Mississippi, where Deere did business, alleging tort causes of action. As to the latter suit, petitioners knew that the federal court had to apply the Mississippi state courts' choice-of-law rules, Klaxon Co. v. Stentor Electric Mfg. Co.,313 U. S. 487, 313 U. S. 496, under which Mississippi's 6-year tort statute of limitations would apply. The Mississippi court then granted petitioners' motion to transfer the tort action to the Pennsylvania court under 28 U.S.C. § 1404(a), which allows such transfers "[f]or the convenience of parties and witnesses, in the interest of justice." However, the Pennsylvania court declined to honor the Mississippi tort statute of limitations, ruling that, since petitioners had moved for transfer as plaintiffs, the rule in Van Dusen v. Barrack,376 U. S. 612 -- that, following a defendant-initiated § 1404(a) transfer, the transferee court must follow the choice-of-law rules prevailing in the transferor court -- was inapplicable. The court therefore dismissed the tort action under Pennsylvania's tort statute of limitations, and the Court of Appeals affirmed.Held: The policies underlying Van Dusen, as well as other considerations, require a transferee forum to apply the law of the transferor court, regardless of who initiated the transfer. Pp. 494 U. S. 521-532.(a) The Van Dusen policy that § 1404(a) should not deprive parties of state law advantages that exist absent diversity jurisdiction is not violated by applying that case's rule to transfers initiated by plaintiffs. Applying the transferor law will not deprive plaintiffs of any state law advantages. Moreover, although a defendant may lose a nonlegal advantage if the transferor law controls -- e.g., Deere would lose whatever advantage inheres in forcing petitioners to litigate in Mississippi or not at all -- that loss is slight, since a plaintiff always can sue in the favorable state court or in diversity and not seek a transfer. Section 1404(a) Page 494 U. S. 517 exists to eliminate inconvenience without altering permissible choices under the federal venue statutes, and it is not its purpose to protect a party's ability to use inconvenience as a shield to discourage or hinder litigation otherwise proper. Applying the transferor law in these circumstances is in full accord with the rule in Erie R. Co. v. Tompkins,304 U. S. 64, whereas applying the transferee law would seriously undermine Erie, since it would mean that initiating a § 1404(a) transfer changes the state law applicable in a diversity case, a result disapproved generally by this Court. See Van Dusen, supra, at 376 U. S. 636-637. Pp. 494 U. S. 524-527.(b) Applying the transferor State's law with respect to plaintiff-initiated § 1404(a) transfers does not contravene Van Dusen's policy against forum shopping, since, even without § 1404(a), a plaintiff already has the option of shopping for a forum with the most favorable law. Applying the transferee law, by contrast, might create opportunities for forum shopping in an indirect way, since such application, to the extent that it discourages plaintiff-initiated transfers, might give States incentives to enact laws similar to Mississippi's long tort statute of limitations in order to bring in out-of-state business that would not be moved at the instance of the plaintiff. Pp. 494 U. S. 527-528.(c) The Van Dusen policy mandating that the § 1404(a) transfer decision turn upon considerations of convenience, rather than on the possibility of prejudice resulting from a change in the applicable law, requires application of the transferor law when a plaintiff initiates the transfer. If a law change were to occur following such a transfer, a district court would be at least reluctant, despite convenience considerations, to grant a transfer that would prejudice the defendant. Hardship might occur because plaintiffs may find as many opportunities to exploit application of the transferee law as they would the transferor law. If the transferee law were to apply, moreover, the plaintiff simply would not move to transfer unless the benefits of convenience outweighed the loss of favorable law. The desire to punish the plaintiff who has chosen an inconvenient forum overlooks the facts that § 1404(a) exists for the benefit of witnesses and courts, as well as the moving party, and that litigation in an inconvenient forum harms the entire judicial system. Pp. 494 U. S. 528-530.(d) Foresight and judicial economy also favor the simple rule that the transferor law should apply regardless of who makes the § 1404(a) motion. While applying the transferee law to plaintiff-initiated transfers would eliminate cases such as this in the future, that rule would produce undesirable complications, and would result in litigation and uncertainty in cases presenting other situations -- e.g., a transfer at the request of both parties, or by the court on its own motion. Pp. 494 U. S. 530-531. Page 494 U. S. 518(e) Although requiring a district court in Pennsylvania to apply a Mississippi statute of limitations to a Pennsylvania cause of action might seem to be too generous to petitioners, and even to reward them for manipulative conduct, that does not affect the outcome of this case, since Congress gave them the power to seek a § 1404(a) transfer, and Van Dusen already could require the same result. Moreover, no alternative rule would be more acceptable. Applying the transferee law would, in effect, tell petitioners that they should have continued litigating their separate actions in Pennsylvania and Mississippi, thereby causing the wastefulness of time, energy, and money that § 1404(a) was designed to prevent. Allowing them simply to file in the convenient forum, and then to request application of the law of the inconvenient forum, would ignore the fact that § 1404(a) does not provide for an automatic transfer, but requires a showing of convenience, and that the transfer is "in the interest of justice." And there is no need to develop more sophisticated federal choice-of-law rules to cover all diversity actions involving transfers, since state conflicts rules already ensure generally that appropriate laws will apply, and, even if more elaborate federal rules would not run afoul of Klaxon and Erie, applying the transferor law effects the appropriate balance between fairness and simplicity. Pp. 494 U. S. 531-532.862 F.2d 31, reversed and remanded.KENNEDY, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and WHITE, STEVENS, and O'CONNOR, JJ., joined. SCALIA, J., filed a dissenting opinion, in which BRENNAN, MARSHALL, and BLACKMUN, JJ., joined, post, p. 494 U. S. 533.