Ecuadorian courts appears inadequate, if not illusory. The court need not reach this issue because defendant has not met its burden of proof that the case should be dismissed on forum non conveniens grounds even if Ecuador does provide a suitable alternative forum.
The doctrine of forum non conveniens is discretionary in nature, see, Gilbert, supra at 507-08; it permits dismissal where plaintiff's forum choice is oppressive and vexatious to defendant or where administrative and legal difficulties make the chosen forum otherwise inappropriate; Koster v. Lumbermen's Mut. Cas. Co., 330 U.S. 518, 524, 91 L. Ed. 1067, 67 S. Ct. 828 (1947). But plaintiff's choice of forum should be disturbed only where the balance of convenience strongly favors the defendant. Gilbert, supra at 508; Hoffman v. Goberman, 420 F.2d 423, 426 (3d Cir. 1970). Where an American plaintiff has chosen his or her home forum and the alternative forum is foreign, an even stronger showing is required. See, Hoffman, supra at 428 (". . . [plaintiff's] election of such a forum should not be disregarded in the absence of persuasive evidence that the retention of jurisdiction will result in manifest injustice to the defendant."); Olympic Corp. v. Societe Generale, 462 F.2d 376, 378 (2d Cir. 1972); cf. Mizokami Bros. of Ariz., Inc. v. Baychem Corp., 556 F.2d 975, 977 (9th Cir. 1977), cert. denied, 434 U.S. 1035, 54 L. Ed. 2d 783, 98 S. Ct. 770 (1978).
"Private interest" factors relevant to a forum non conveniens inquiry include: relative ease of access to sources of proof; availability of compulsory process for attendance of unwilling witnesses; cost of trial attendance by willing witnesses; possibility of viewing the premises, if appropriate; and enforceability of the judgment. A court must not permit harassment of the defendant by plaintiff's choice of a forum unnecessarily inconvenient to the defendant. Gilbert, supra at 508. It must weigh the potential for a fair trial in each alternative forum. "Public interest" factors include the relative congestion of court dockets, choice of law considerations, and the relationship of the community in which the courts and jurors reside to the events giving rise to the litigation. Id. at 508-09.
SALCO contracted with D & Z to design, prepare plans and specifications, and procure materials and equipment
for its new cocoa processing plant in Ecuador. SALCO asserts that the contract with D & Z was to be performed primarily in Ecuador, not Pennsylvania, id. at 19, and that a "significant amount of time [was spent by plaintiff's employees and agents] in performing site surveys, information gathering, and various on-site supervisory and inspection services . . . during various stages of development and construction of the new plant," id. at 9. SALCO does not dispute that it rejected D & Z's proposal to provide construction management services in Ecuador and contracted with an Ecuadorian firm to supervise construction of the plant instead. Id., PP 6-7. D & Z avers that the time spent by its personnel in Ecuador approximated only six percent of the total time spent on the project and that most of the remainder (94%) was spent at D & Z headquarters in Pennsylvania. Affidavit of Gil J. Karlsson, paras. 9-10. The contract was for the most part performed in the United States.
SALCO contends that "the focus of this action will be not on plaintiff's claim but on the defendant's counterclaim that faulty performance of the contract resulted in the construction of a substandard . . . plant in Ecuador." Defendant's Memorandum, supra at 3. It asserts that the trier of fact will be deprived of the opportunity to view the new cocoa bean processing plant if this case is tried here. Had D & Z's contractual obligations included direct supervision of construction of defendant's plant, view of the plant site might be critical. But D & Z's contractual obligations were limited chiefly to design and procurement; evidence of D & Z's performance will be found in designs, specifications and procurement orders it executed. D & Z's books and records are located in Pennsylvania, as are its executives, employees who worked on the project, and chocolate industry experts whom D & Z will call to testify to the validity of its designs. Plaintiff's Memorandum of Law Opposing Defendant's Motion to Dismiss the Complaint on Forum Non Conveniens Grounds, 13; Karlsson Affidavit, para. 22. The parties are not precluded from submitting videotaped, photographic or other evidence of the cocoa plant's condition. Dismissal for inability to view the plant is not warranted. But cf. Shepard Niles Crane & Hoist Corp. v. Fiat, S.A. et al., 84 F.R.D. 299 (W.D.N.Y. 1979) (suit against Italian corporation dismissed where contract at issue included installation of hot metal carrier system in Italy); J.F. Pritchard & Co. v. Dow Chemical of Canada, Ltd., 331 F. Supp. 1215 (W.D. Mo. 1971), affirmed, 462 F.2d 998 (8th Cir. 1972) (suit against Canadian corporation dismissed where contract included construction of ammonia plant in Canada).
SALCO avers it would call over forty witnesses on the issue of D & Z's performance under the disputed contract and that most of them are located in Ecuador. Affidavit of Guillereno Arosemena, para. 22. Of those potential witnesses, at least five are party witnesses (id., (1)-(4), (39)); of the non-party witnesses, four are employees of U.S. corporations (id., (23), (24), (35), (40)) and the remaining non-party witnesses are Ecuadorian architects, engineers and contractors. D & Z asserts that most of these proposed witnesses have nothing to do with the scope of D & Z's work; it proposes to call sixteen employees and at least sixteen non-party witnesses to testify, of whom ten or more may be joined as third-party defendants. Plaintiff's Memorandum, supra at 8-9; Karlsson Affidavit, paras. 21-22. D & Z states that if SALCO's actual counterclaim proves broader in scope than its present allegations suggest, plaintiff might wish to call additional witnesses or join additional defendants from among the more than sixty U.S. contractors and suppliers with whom it dealt in fulfilling its procurement obligations to SALCO. Plaintiff's Memorandum, supra at 9.
Whether this suit is litigated in the Eastern District of Pennsylvania or in Ecuador, the non-resident corporation will incur substantial costs in making its own employees available to testify at trial and its operations may be seriously disrupted by their absence. The non-resident party may be prevented from the use of process for compelling the testimony of witnesses and from joining third-party defendants beyond the court's jurisdiction.
SALCO must prove that the balance of convenience in this regard tips strongly in its favor. Gilbert, supra at 508; see, Dale Metals Corp. v. Kiwa Chemical Industry Co., Ltd. et al., 442 F. Supp. 78, 81 (S.D.N.Y. 1977) (dismissal motion denied where Japanese defendants at best tipped balance of witnesses "into equipoise"). It has not met that burden.
Finally, SALCO argues that this court is not an appropriate forum because it would be required to apply Ecuadorian law. Defendant's Memorandum, 30-33. But a district court need not dismiss a case simply because it would have to apply foreign law, Hoffman, supra at 427. In diversity suits the district court will apply the choice of law rules of the forum state. Klaxon Co. v. Stentor Electric Manufacturing Co., Inc., 313 U.S. 487, 85 L. Ed. 1477, 61 S. Ct. 1020 (1941), on remand, 125 F.2d 820 (3d Cir. 1942), cert. denied, 316 U.S. 685, 62 S. Ct. 1284, 86 L. Ed. 1757 (1942); Melville v. American Home Assurance Co., 584 F.2d 1306, 1308 (3d Cir. 1978). Pennsylvania's conflicts law combines both grouping of contacts and interest analysis. Id. at 1311.
In a suit for breach of contract relevant contacts include the places of negotiation, contracting and performance, location of the subject matter of the contract, and citizenship of the parties. Schoenkopf v. Brown & Williamson Tobacco Corp., 483 F. Supp. 1185, 1195 (E.D. Pa. 1980), affirmed, 637 F.2d 205 (3d Cir. 1980).
The principal contract at issue was negotiated both in Pennsylvania and Ecuador. See, Arosemena Affidavit, supra, PP 5-9; Affidavit of Charles A. Word, paras. 4, 6-18. It was executed by SALCO in Ecuador, although the parties differ as to the date and means by which the executed contract was returned to D & Z. See, Arosemena Affidavit, supra, P 8; Word Affidavit, supra, P 17. The subsequent letter agreement adding procurement services was also executed by SALCO in Ecuador, Karlsson Affidavit, supra, P 8. But the designs, specifications and procurement orders which are the subject of the contract are located in Philadelphia. The contract was substantially performed at plaintiff's Philadelphia headquarters, see, id., PP 9-10.
The more significant contracts are in Pennsylvania. See, Schoenkopf, supra at 1195 and n.3 (Pennsylvania law applied where Pennsylvania was "central and substantial place of performance"); Bohrer-Reagan Corp. v. Modine Manufacturing Co., 433 F. Supp. 578 (E.D. Pa. 1977) (Pennsylvania law applied where place of contract formation was unclear but place of performance was Pennsylvania); cf. Shepard Niles, supra (suit dismissed where significant part of performance was in Italy and contract stipulated application of Italian law in an Italian forum); Pritchard, supra (suit dismissed where contract was executed and performed in Canada and contract stipulated application of Canadian law).
SALCO nevertheless asserts that under interest analysis, Ecuadorian law should govern. Defendant's Memorandum, supra at 32. Ecuador has a significant interest in litigation involving Ecuador's leading producer of cocoa products. See, Word Affidavit, Exhibit "A" (advertising brochure of Salcedo Group, SALCO's parent company). Should SALCO implead Ecuadorian contractors and suppliers involved in construction of its plant, Ecuador's interest in the dispute would be even greater. However, the interest of Pennsylvania is also substantial. D & Z's principal place of business is in Philadelphia, where it employs approximately six hundred people. Affidavit of Harry M. Perks, para. 4. Sixty or more contractors and suppliers with whom D & Z did business in executing its contract with SALCO are United States companies. Plaintiff's Memorandum, supra at 9. Of those that D & Z names as potential third-party defendants, two are Pennsylvania corporations (five are New Jersey or New York companies having economic ties with this forum). In light of these factors, it is Pennsylvania law that will most likely apply.
Thus, neither a contacts nor interest analysis dictates the application of Ecuadorian law; neither private nor public interest factors weigh heavily in defendant's favor. Therefore, plaintiff's forum choice will not be disturbed. See, Gilbert, supra at 508; Hoffman, supra at 426.
AND NOW, this 19th day of October, 1982, upon consideration of defendant's motion to dismiss for forum non conveniens, plaintiff's response thereto, defendant's reply, supporting briefs, affidavits and exhibits, and for the reasons set forth in the accompanying Memorandum, it is ORDERED that defendant's motion is DENIED.