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Dealing a significant legal setback to the remaining plaintiffs suing over the September 1998 crash of Swissair Flight 111, a federal judge has ruled that most of the defendants are immune from punitive damages because the case is governed by both the Warsaw Convention and the Death on the High Seas Act. The rulings came in a pair of opinions handed down last week by Chief U.S. District Judge James T. Giles of the Eastern District of Pennsylvania, who was assigned to preside over all the case under the federal Multi-District Litigation Program. In the first opinion, Giles ruled that because the crash occurred in Canadian waters, it is covered by the Death on the High Seas Act, or DOHSA. Plaintiffs’ lawyers argued that DOHSA applies only when an accident occurs in the “sovereignless” high seas and not when it occurred in foreign territorial waters. Giles agreed that the plaintiffs had a valid argument that the term “high seas” is used in maritime law to refer only to those waters not claimed by any country. But Giles found that Congress had a different meaning in mind when it passed DOHSA in 1920. In a long line of decisions, Giles said, the federal courts have routinely applied DOHSA to cases involving accidents in another country’s territorial waters. In a string citation, Giles noted that DOHSA has been applied to cases involving the English Channel, a Venezuelan lake, a river in Peru and a scuba-diving expedition off the Berry Islands in the Bahamas. And since DOHSA was amended in 2000, Giles said, it is safe to assume that Congress was aware of how the courts were applying the law and must be presumed to have acquiesced to the courts’ interpretation of the term “high seas.” “A court must assume that Congress intended a given term to have its ‘established meaning.’ However, if there is a contrary indication — that is, some evidence that Congress did not intend a term to have its established meaning — a court must look to the definition that best explains existing case law and that is consistent with any known Congressional terminology distinctions,” Giles wrote. “Because DOHSA was amended in 2000, the principles of statutory interpretation applicable to amendments require this court to assume that when it amended DOHSA, Congress was aware of and intended to carry forth the effect given by the courts in interpreting ‘high seas’ over the decades following DOHSA’s original enactment,” Giles wrote. In the second opinion, Giles concluded that the Warsaw Convention applies not only to Swissair and Delta Airlines, but also to SR Technics, a company that oversaw the installation of an in-flight entertainment system that plaintiffs claim was the cause of the crash. Giles found that since SR Technics took on Swissair’s responsibilities for certifying planes as airworthy after the entertainment system was installed, it qualifies for the same Warsaw Convention protection afforded to any “carrier.” According to court papers, Flight 111 left New York City’s John F. Kennedy Airport on Sept. 2, 1998, en route to Geneva, Switzerland. Within minutes, pilots notified air traffic controllers that they were diverting the flight to Halifax because of smoke in the cockpit. About 17 minutes later, the flight crashed into the Atlantic Ocean off Peggy’s Cove, Nova Scotia, killing 229 — a crew of 14 and 215 passengers, primarily American, Canadian, Swiss and French. Although the precise location of the September 1998 crash is undetermined, both sides agreed that it occurred within the 12-mile territorial waters currently claimed by the Canadian federal government, but outside the 3-mile limit of the territorial waters claimed by Canada at the time the U.S. Congress passed DOHSA in 1920. Lawsuits were filed on behalf of more than 140 decedent passengers in federal courts throughout the United States. The defendants include Swissair, which controlled and operated the international flight; Delta Airlines, which ticketed many of the American passengers, pursuant to an operating agreement between the airlines; McDonnell Douglas, which manufactured the airplane; and Boeing, which owns McDonnell Douglas and acts as its successor-in-interest. The plaintiffs allege that a primary cause of the crash was a fire sparked by a malfunction in the in-flight entertainment system (IFEN), which provided passengers with gaming, shopping, individual movies, video programming and other services. As a result, the plaintiffs also sued Interactive Flight Technologies Ltd., which developed, designed, built components for, and marketed the IFEN system and entered into a contract with Swissair to equip the Swissair fleet with the system; Hollingsead International, which performed the airplane/IFEN integration engineering and installation pursuant to a contract with IFT; Santa Barbara Aerospace, which obtained the necessary certification from the Federal Aviation Administration for the installation of the IFEN system and reviewed test results for environmental testing of IFEN system components; and SR Technics, which, pursuant to a contract with Swissair, provided facilities, support and oversight for the installation of the IFEN system, monitored the quality of the workmanship of the systems installed, and certified the aircraft as airworthy following installation of the IFEN system and prior to the return of the plane to service. The plaintiffs also sued DuPont, the manufacturer of the metallized Mylar used in the aircraft’s insulation blankets, which, they theorize, permitted the rapid spread of the fire. Boeing and Swissair conceded liability for purposes of compensatory damages only and agreed to pay to any plaintiff full compensatory damages available under any law, foreign or domestic, that was determined applicable to a particular decedent in a particular case, provided the claim was limited to compensatory damages. Cross-claims for contribution and indemnification were filed by and among the various defendants. Once the plaintiffs’ claims for damages have been tried or settled, the defendants will resolve those issues among themselves or through trial. Because the Canadian authorities are still investigating the crash and have not issued a final report of their findings, and to afford all parties a fair opportunity to attempt to settle claims amicably, Giles stayed liability discovery pending resolution of the question whether DOHSA is the exclusive avenue for assertion of claims against defendants in actions brought in the courts of the United States. By its terms, DOHSA precludes recovery of punitive damages. Now Giles has ruled that the amended version of DOHSA applies to the case. Plaintiffs’ lawyers argued that DOHSA should not apply because the “established meaning” of the term “high seas” does not include the territorial waters of another country. But Giles found that Congress did not intend for the established meaning of the term high seas to apply when it passed DOHSA. “Despite this ostensibly established meaning under international law, a review of legislative history … demonstrates that the proponents and opponents of the original DOHSA legislation employed substantively different definitions of the term, and it can be vigorously disputed whether Congress intended to incorporate into DOHSA the international concept of high seas as sovereignless waters,” Giles wrote. Giles found that the long line of case law interpreting the original 1920 version of DOHSA controls because Congress must have been aware that the courts were interpreting the term “high seas” to exclude foreign territorial waters when it amended DOHSA in 2000. “When Congress amends an existing statute, a court must presume that any part of the statute left intact reflects Congress’ intent to preserve the prevailing judicial interpretation of that portion,” Giles wrote. Swissair, Delta and SR Technics were represented by attorneys Michael J. Holland and Desmond T. Barry of Condon & Forsyth in New York. Boeing was represented by attorneys Jerome J. Shestack, Patrick T. Matusky and Judd A. Serotta of Philadelphia-based Wolf, Block, Schorr & Solis-Cohen, along with Keith Gerrard, Rex C. Browning, Ronald A. McIntire and Allison Kendrick of Perkins Coie in Washington, D.C. The plaintiffs’ team is led by Lee Kreindler of New York’s Kreindler & Kreindler and includes Kenneth P. Nolan and Frank Granito Jr. of Speiser Krause in New York; Jerome L. Skinner of Waite Schneider in Cincinnati; Aaron S. Podhurst of Podhurst, Orseck, Josefsburg, Eaton, Meadow, Olin & Perwin in Miami; Michel Baumeister of Baumeister & Samuels in New York; Jonathan C. Reiter of Broder & Reiter in New York; Robert Clifford and Donald J. Nolan, both of Chicago; and David E. Rapoport of Rosemont, Ill.

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