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December 2012: Unanimous Affirmance of Trial Court Victory in Forum Non Conveniens Case

December 2012

After winning dismissal of a lawsuit against The Coca-Cola Company (“TCCC”) in the Southern District of New York, Quinn Emanuel recently secured a unanimous affirmance in the Second Circuit Court of Appeals. In 2010, two Guatemalan citizens filed suit in New York against TCCC on the basis of anti-labor violence allegedly perpetrated in Guatemala not by TCCC, but by its former independent local bottler. TCCC itself had nothing to do with this wrongdoing, and was not even aware of it while it was occurring, but nevertheless found itself embroiled in potentially costly litigation in a forum thousands of miles away from where the events had occurred. Quinn Emanuel stepped in, as it has in numerous similar lawsuits arising around the globe, and immediately obtained forum non conveniens dismissal on the ground that the plaintiffs should have brought their case in Guatemala, where the underlying events had occurred and the pertinent evidence and witnesses were located. Quinn Emanuel demonstrated to the district court’s satisfaction that Guatemala was a fully adequate judicial forum (a prerequisite to obtaining dismissal), and that the plaintiffs would not have to appear in Guatemalan court—thus assuaging the court’s concerns for their safety. The district court thus dismissed the case.

The district court, however, left the plaintiffs with an out: If the Guatemalan courts refused to hear their case, and if such a decision was affirmed by that country’s highest tribunal, the district court indicated willingness to reinstate the complaint in New York. But because the plaintiffs had no interest in actually pursuing their case outside the U.S., they responded to the dismissal order by filing a purposefully inadequate complaint in Guatemala. When the Guatemalan court dismissed that complaint, the plaintiffs declined to pursue an appeal in Guatemala, and instead immediately returned to the district court in New York.

Quinn Emanuel convinced the court that the plaintiffs’ efforts in Guatemala did not comply with the district court’s conditions to reinstatement because the Guatemalan complaint had obscured the reason for the Southern District’s dismissal order, and had even suggested inaccurately that the U.S. courts had retained jurisdiction. Worse, the plaintiffs had neglected to inform the Guatemalan court of a clear basis for its own authority to hear the case. The district court agreed, and refused to reinstate the plaintiffs’ complaint. And, in September, a three-judge appellate panel unanimously affirmed, adopting TCCC’s position (and that of the district court) in full.