Carris, Ted F. v. Marriott Int'l , 466 F.3d 558 ( 2006 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 06-1506
TED F. CARRIS,
Plaintiff-Ap p ellant,
v.
MARRIOTT INTERNATIONAL, INC., et al.,
Defend ants-Ap p ellees.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 04 C 1480—Joan B. Gottschall, Jud ge.
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ARGUED SEPTEMBER 6, 2006—DECIDED OCTOBER 16, 2006
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Before FLAUM, Chief Jud ge, and BAUER and POSNER,
Circuit Jud ges.
POSNER, Circuit Jud ge. This appeal from the dismissal of a
complaint for failure to state a claim presents a question of
conflict of laws that is very similar to the one we resolved in
Sp ino zzi v. ITT Sherato n Co rp ., 174 F.3d 842 (7th Cir. 1999).
In response to a Sheraton advertisement in Illinois, Spinozzi
had made a reservation at a resort hotel that Sheraton
owned in Acapulco. One night after he arrived, the lights
went out and searching in the dark for a room occupied by
his friends he fell into an unguarded maintenance pit on the
2 No. 06-1506
hotel grounds. In the ensuing diversity suit he asked the
district court in Illinois to apply Illinois rather than Mexican
law because Mexican law makes contributory negligence a
complete defense to a suit for negligence, while Illinois, like
most other U.S. states, has switched to comparative negli-
gence. We ruled that Mexican law applied. That was where
the accident occurred and Mexico had a stronger interest
than any other jurisdiction in regulating the safety of hotels
located there. We also noted the unacceptable burden that
would be placed on a hotel if it had to comply with the tort
law of every country from which its guests came. But we
said that it would be a different case (though we could find
no authority on the point) if Sheraton’s advertisements in
Illinois had stated or implied that an Illinois guest of the
Acapulco Sheraton would have the same legal rights that he
would have if it were the Chicago Sheraton.
The present suit by Ted Carris against Marriott Interna-
tional, the owner of the Marriott hotel chain, was dismissed
on the pleadings and so we accept as true the facts alleged
by the plaintiff, according to which: Carris is a fan of the
Marriott chain and believes that it maintains “high stan-
dards of accommodation and recreatio n” (emphasis added).
He is a resident of Illinois, and it was there that by clicking
on the Marriott International website he discovered and
made a reservation at the Nassau Marriott Resort (NMR) in
the Bahamas. NMR advertised on its website (which Carris
accessed from Marriott’s) that it offers its guests a variety of
recreational activities, including jet skiing. Carris believed
that NMR was owned by Marriott, and claims he wouldn’t
have gone there had he known it was merely franchised by
Marriott.
At the resort he rented a jet ski, and while operating it in
“the permitted area” off NMR’s private beach fell off the
jet ski, breaking his leg. He drifted for hours in the water
No. 06-1506 3
before being rescued by a passing boat. He claims that the
accident was caused by NMR’s negligence in failing to
supervise the jet ski concessionaire, to warn him that the jet
ski concession w as a concession rather than being managed
by the resort’s employees, to teach him how to operate the
jet ski safely, to alert him to the hazards of jet skiing in an
ocean, and to equip the jet ski with a “kill switch.” We
digress to note that allegations of negligence are, despite
appearances, essential to his claim. Had the accident
occurred despite due care by the resort, the fact that Carris
would not have been there had he not thought it was owned
by Marriott would not establish legal causation (just “but
for” causation, which is never enough for liability), because
the misrepresentation would not have increased the risk of
an accident. That risk would (assuming due care by NMR)
have been just as great had the resort been owned by
Marriott. See, e.g., Berry v. Sugar No tch Bo ro ugh, 43 Atl.
240 (Pa. 1899); William M. Landes & Richard A. Posner, The
Eco no m ic Structure o f To rt Law 238 (1987).
Carris wants Illinois tort law to govern his case because
that law includes an extension of the agency doctrine of
respondeat superior that would enable him to fasten
vicarious liability on Marriott for negligence by employees
of NMR. Had Marriott owned the resort, the negligence of
the employees (though probably not of the concessionaire,
an independent contractor) would be Marriott’s responsibil-
ity under that doctrine. Marriott was not their employer,
however—NMR, a separate, indeed unaffiliated (in the
corporate law sense), corporation was—and so NMR’s
employees were not Marriott’s employees and their negli-
gence would not be imputed to Marriott as a matter of
respondeat superior. But if Marriott created the ap p earance
that NMR was owned by Marriott, and Carris was led by
that appearance to believe that it was owned by Marriott
and he relied to his detriment on that belief, then the
4 No. 06-1506
doctrine of apparent authority (more commonly of course
invoked in contract cases than in tort cases, see, e.g., Sark es
Tarzian, Inc. v. U.S. Trust Co ., 397 F.3d 577, 583 (7th Cir.
2005)), would allow him to treat Marriott as if were the
employer of NMR’s employees. Yo rk v. Rush-Presbyterian-
St. Luk eås Med ical Center, No. 99507, 2006 WL 1702529, at
*17-30 (Ill. June 22, 2006); Gilbert v. Sycam o re Municip al
Ho sp ital, 622 N.E.2d 788, 795-96 (Ill. 1993); OåBanner v.
McDo nald ås Co rp ., 670 N.E.2d 632, 634-35 (Ill. 1996);
Crink ley v. Ho lid ay Inns, Inc., 844 F.2d 156, 166-67 (4th Cir.
1988).
The parties agree, however, that under Bahamian law, as
under the English common law, which the Bahamas, a
former colony of England, has adopted, apparent authority
is not a ground of tort liability. This probably is incorrect.
Arm agas Ltd . v. Mund o gas S.A. (The ç Ocean Fro sté ), [1986]
2 Lloyd’s Rep. 109, 115-16 (House of Lords); Navarro v.
Mo regrand Ltd ., [1951] 2 T.L.R. 674, 680 (Court of Appeal).
But we leave the parties to their agreement, and so if
Bahamian law applies, Carris’s only recourse is against
NMR, and presumably he would have to sue it in the
Bahamas. So we must determine whether under Illinois
conflict of laws principles (for in a diversity suit the federal
court applies the conflicts principles of the state in which it
sits), Illinois or Bahamian tort law governs this case.
Illinois conflicts principles require the court to select the
law of the jurisdiction that has the “most significant rela-
tionship” to the events out of which the suit arose, and to
the parties. Esser v. McIntyre, 661 N.E.2d 1138, 1141 (Ill.
1996). In the case of a tort suit, this analysis usually points
to the jurisdiction in which the conduct giving rise to the
suit occurred, for a state regulates the safety of the activities
that are carried on within its borders. (That was the insight
behind the old torts conflict rule of lex lo ci d elicti, still the
No. 06-1506 5
default rule in tort cases.) And here the regulating jurisdic-
tion is the Bahamas. Carris resists this conclusion, arguing
that maybe the accident occurred in international waters,
beyond the three-mile limit. That is unlikely, considering
what ocean swells would do to such a tiny craft and that
Carris claims to have been operating the jet ski in “the
permitted area” off the beach when the accident occurred.
No matter. The conduct of which he complains is not the
accident itself (unlike the case in which the accident victim
is a passenger in a boat negligently operated by the defen-
dant) but the absence of instruction in the operation of a jet
ski, the absence of safety equipment, and the failure to
supervise the concessionaire, all of which acts or omissions
occurred before Carris left the beach. He doesn’t even
complain of the defendant’s failure to have rescued him
when he fell off the jet ski, a failure that may conceivably
(though improbably) have “occurred” (in the sense that the
omission of a material fact might be said to occur in the
securities prospectus that should have stated the fact) in
international waters.
All that Carris has to link the accident to Illinois, then,
besides his being a resident of that state—which clearly is
not enough by itself, since Marriott is not an Illinois resident
and the accident (and the negligent acts that Carris claims
caused the accident) occurred elsewhere, see Tanner v.
Jup iter Realty Co rp ., 433 F.3d 913, 914-16 (7th Cir. 2006);
Sp ino zzi v. ITT Sherato n Co rp ., sup ra, 174 F.3d at 846; Bi-
Rite Enterp rises, Inc. v. Bruce Miner Co ., 757 F.2d 440,
443 (1st Cir. 1985); Cum m ings v. Club Med iterranee S.A.,
2003 U.S. Dist. LEXIS 19459 (N.D. Ill. 2003); compare Esser
v. McIntyre, 661 N.E.2d 1138, 1142 (Ill. 1996); Co o k v.
Winfrey, 141 F.3d 322, 329 (7th Cir. 1998)—is that Marriott
has a website accessible to anybody in the world who has
uncensored Internet access. No one suggests that at its
6 No. 06-1506
website or elsewhere Marriott implies that Illinois law
would follow an Illinoisian to the Bahamas or that NMR
complies with U.S. or Illinois safety standards for the rental,
design, or operation of jet skis (on which see National
Transportation Safety Board, “Personal Watercraft Safety
Study” 35 (NTSB/SS-98/01); Boat Registration and Safety
Act, 625 ILCS 45/4 to 45/5)). The State Department even
warns travelers that “the water sports and scooter rental
industries in the Bahamas are not carefully regulated.
Visitors should rent equipment only from reputable opera-
tors, and should insist on sufficient training before using the
equipment. Every year, people are killed or injured by the
improper use of scooters, jet-skis, and personal watercraft or
by the careless or reckless operation of such equipment by
others. You should insist on seeing proof that operators
have sufficient medical and liability insurance. Travelers
should also invest in low-cost traveler’s insurance that
includes medical evacuations, as most American insurance
companies do not cover this.” U.S. State Department,
Co nsular Info rm atio n Sheet: The Baham as: Safety and
Security, Sept. 25, 2006, http://travel.state.gov/travel/
cis_pa_tw/cis/cis_989.html.
So the case really is just like Sp ino zzi—in fact even more
clear cut against applying Illinois law, because of the nature
of the advertising that drew Carris to the Bahamian resort.
If he is right about Illinois principles of conflict of laws, any
hotel chain that has a website (and it is doubtful that any
hotel chain does not) subjects itself to the tort law of every
country whose nationals stay at one of the hotels in the
chain, or at least every country that has a conflict of laws
standard as spongy as Illinois’. The burden of compliance
would be staggering, especially since different countries,
having different ideas about safety, might impose inconsis-
tent tort duties. One jurisdiction might think the absence of
airbags from vehicles negligent; another might think their
No. 06-1506 7
presence negligent because of the danger to children. So
how would a hotel equip its airport shuttle van?
Carris argues alternatively that the rejection by Bahamian
law (as he assumes) of the apparent authority extension of
respondeat superior is so offensive to the fundamental
policy of the State of Illinois that the state courts would
insist that Illinois tort law govern this case, though not
Bahamian water accidents generally. The Bahamas’ as-
sumed rejection of a somewhat esoteric (though neither
novel nor uncommon) extension of traditional common law
principles (esoteric when applied tort as distinct from
contract cases) is not so “evil or repugnant” (Lyo ns v.
Turner Co nstructio n Co ., 551 N.E.2d 1062, 1065 (Ill. App.
1990)) as to offend a fundamental policy of Illinois. It is less
“evil or repugnant” than the rejection of comparative
negligence, which we held in Sp ino zzi did not offend a
fundamental policy of Illinois law, 174 F.3d at 846-49, or
than allowing punitive damages to be insured against, held
in Internatio nal Surp lus Lines Ins. Co . v. Pio neer Life Ins.
Co ., 568 N.E.2d 9, 15-17 (Ill. App. 1990), not to offend
fundamental principles of Illinois law either. Compare
Do nald so n v. Fluo r Engineers, Inc., 523 N.E.2d 1113, 1113-17
(Ill. App. 1988), and Panco tto v. So cied ad e d e Safaris d e
Mo cam biq ue, S.A.R.L., 422 F. Supp. 405, 409-12 (N.D. Ill.
1976), the former a case in which Illinois public policy was
embodied in a statute rather than in a common law princi-
ple; statutes tend to be more emphatic declarations of state
policy than judicial decisions, being enacted by legislatures,
with their superior democratic legitimacy, rather than
devised by courts.
In this case, moreover, the apparent authority doctrine,
itself an extension of traditional tort principles, would be
stretched so far from its heartland that the state policy
supporting the doctrine would be severely attenuated.
8 No. 06-1506
Almost everyone knows that chain outlets, whether restau-
rants, motels, hotels, resorts, or gas stations, are very often
franchised rather than owned by the owner of the trade-
mark that gives the chain its common identity in the
marketplace. Had Carris really believed that owned and
franchised Marriotts abroad have different standards of
safety for jet skiing (but why would anyone think that,
when trademarks are a representation of unifo rm quality, of
which safety is an important dimension in the case of a
resort, and the same Marriott trademark covers both its
owned and its franchised hotels?), he should have inquired
into the ownership of NMR rather than assume that it was
owned by Marriott.
AFFIRMED.
A true Copy:
Teste:
_______________________________
Clerk o f the United States Co urt o f
Ap p eals fo r the Seventh Circuit
USCA-02-C-0072—10-16-06