BOSTON (CN) — General Electric will escape scot-free for its role in designing and maintaining the Fukushima nuclear plant that was hit by a tsunami and caused billions of dollars in damage, the First Circuit ruled Friday.
The court rejected a lawsuit brought by 150,000 Japanese individuals and businesses who said they were “economically devastated” in March 2011 when an earthquake unleashed a 45-foot wave that overwhelmed the plant, causing an explosion and a massive release of radiation.
Under Japanese law, all claims related to the disaster must be brought against TEPCO, short for the Tokyo Electric Power Co., either in a lawsuit or an administrative proceeding. TEPCO has already paid out more than $80 billion in claims, partially subsidized by the Japanese government.
But the plaintiffs in this case filed suit in Boston, where GE is headquartered, claiming that an American court should allow them to sue an American corporation. Led by Shinya Imamura, they claimed GE was negligent in designing and maintaining the plant and in choosing a site for it that had a “long-recorded history of very large earthquakes and tsunamis.”
The head federal judge in Massachusetts, Chief U.S. District Judge Patti Saris, dismissed the suit in April 2019 on forum non conveniens grounds, saying the case should be brought in Japan because an adequate remedy for the plaintiffs’ injuries existed there.
The plaintiffs appealed, arguing that, even if they had a remedy in Japan, they didn’t have any remedy against General Electric. They also claimed an “inherent right” to seek recovery against all wrongdoers, not just TEPCO.
But the First Circuit disagreed. “So long as Japanese courts continue to allow plaintiffs their day in court, where they may obtain full and fair compensation — regardless of which entity ultimately foots the bill — there is no meaningful absence of jurisdiction,” U.S. Circuit Judge Juan Torruella wrote for the court.
“While plaintiffs may not be able to obtain recovery in Japan specifically from GE, Japan nevertheless adequately addresses the same types of claims through a carefully designed … compensation scheme.”
An 86-year-old Reagan appointee, Torruella also called it likely that, even if the plaintiffs could bring a lawsuit in Massachusetts, a Massachusetts court would have to apply Japanese law, and thus the suit would end up getting dismissed anyway.
The plaintiffs “appear to be motivated at least in part by forum shopping,” wrote Torruella.
Imamura and his co-plaintiffs will consider filing a petition with the U.S. Supreme Court, their attorney, Earl Forte of Eckert Seamans, told Courthouse News. Forte said the damages are “very substantial,” and he will be planning next steps as soon as he is able to contact the lead plaintiffs in Japan.
Maggie Gardner, an expert on international litigation at Cornell Law School, told Courthouse News that the result doesn’t surprise her.
“Federal judges have a lot of discretion, I would say too much discretion, to dismiss transnational cases — even where, like here, the plaintiffs are suing U.S. corporations in their home courts,” she said.
“But given the current state of the law, and given Japan’s adoption of a unified compensation scheme, this is not a surprising application” of forum non conveniens, Gardner added.
A similar case was argued last month in the Ninth Circuit in which a group of U.S. sailors sued GE over injuries they allegedly received while offering humanitarian aid in the wake of the Fukushima disaster. They claim that they were injured while on board U.S. ships and therefore the injuries occurred in the U.S. under the Convention on the High Seas treaty. A trial court in that case also dismissed the claims against GE.
The sailors are represented by John Edwards, the 2004 Democratic vice-presidential nominee. Edwards’ firm also represents a separate group of sailors who have filed a federal suit that is pending in Washington, D.C.
GE shares were down for the day and showed little reaction to the news.
The First Circuit opinion was joined by U.S. Circuit Judges Sandra Lynch, a Clinton appointee, and William Kayatta, who was appointed by President Obama.
At oral argument last October, Lynch had pressed the plaintiffs’ side on why they wanted to bring the case in the U.S. when they could collect the same damages in Japan, suggesting that their chief goal was “simply pressuring GE into a settlement.”