In Re Air Crash Disaster Near Peggy's Cove, Nova Scotia on September 2, 1998 , 210 F. Supp. 2d 570 ( 2002 )

MEMORANDUM

GILES, Chief Judge.

I. INTRODUCTION

Responsible for conducting consolidated pretrial proceedings in the Multidistrict Litigation arising from the crash of Swissair Flight No. Ill near Peggy’s Cove, Nova Scotia, on September 2, 1998, the court now considers the motion of defendants The Boeing Co. (“Boeing”) and McDonnell Douglas Corporation (“McDonnell Douglas”), joined by all other defendants, to dismiss all claims for punitive damages as precluded by the Death on the High Seas by Wrongful Act, as amended, 46 U.S.C. app. §§ 761-767 (“DOHSA”). They argue that DOHSA is the exclusive avenue open to plaintiffs for any monetary recovery.¹ For the reasons that follow, defendants’ motion is granted and judgment is entered in favor of the defendants as to all claims for punitive damages.

II. BACKGROUND

Swissair Flight No. Ill, a McDonnell-Douglas MD-11 aircraft, departed from New York City’s John F. Kennedy Airport en route to Geneva, Switzerland. Although the precise location of the September 2, 1998 crash is undetermined at this time, defendants stipulate for the purposes of this motion that the accident site is within the 12-mile territorial waters currently claimed by the Canadian federal government, but is outside the 3-mile limit of the territorial waters claimed by Canada at the time the U.S. Congress passed DOHSA in 1920.² Two-hundred fifteen passengers, primarily American, Canadian, Swiss, ,and French domiciliaries, and fourteen crew members were killed in the crash.

Lawsuits were filed on behalf of more than 140 decedent passengers on that flight in federal courts throughout the United States. The defendants include: Swissair, which controlled and operated the international flight; Delta, which ticketed- many of the American passengers, pursuant to an operating agreement between the airlines; SAirGroup, the parent holding company for Swissair; McDonnell Douglas, which manufactured the airplane; and Boeing, which owns McDonnell Douglas and acts as its successor-in-interest. In addition, the plaintiffs allege that a primary cause of the crash was a fire sparked by a malfunction in the In-Flight Entertainment (“IFEN”) System. This system provided passengers with gaming, shopping, individual movies, video programming, and other services. Plaintiffs also have sued Interactive Flight Technologies, Ltd. (“IFT”), 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 (“HI”), which performed the airplane/IFEN integration engineering and installation pursuant to a contract with IFT; Santa Barbara Aerospace (“SBA”), which, pursuant to a subcontract with HI, obtained the necessary certification from the Federal Aviation Administration (“FAA”) 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.³ Plaintiffs have 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.

The federal court cases were transferred to this court for coordinated and consolidated pretrial proceedings pursuant to 28 U.S.C. § 1407(a) since the cases involve common questions of fact. Pursuant to a joint agreement, 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, the court 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.

Defendants argue that DOHSA applies because the crash occurred on the high seas more than 12 nautical miles from United States shores and that it must be applied, at least, as to all U.S. domiciliary decedents.

Plaintiffs respond that DOHSA cannot apply because the crash occurred in Canadian territorial waters which, they contend, are not included in the internationally accepted scope of the term “high seas.” They offer that for accidents occurring in foreign territorial waters general maritime law, in conjunction with state law, provides sufficient guidance as to appropriate legal remedies.

III. DISCUSSION

DOHSA

As' amended in 2000, DOHSA provides, in pertinent part:

In the case of a commercial aviation accident, whenever the death of a person shall be caused by wrongful act, neglect, or default occurring on the high seas 12 nautical miles or closer to the shore of any State, or the District of Columbia, or the Territories or dependencies of the United States, this chapter shall not apply and the rules applicable under Federal, State, and other appropriate law shall apply.

46 U.S.C. app. § 761(b).

The Amendment created a new cause of action for nonpeeuniary damages.

If the death resulted from a commercial aviation accident occurring on the high seas beyond 12 nautical miles from the shore of any State, or the District of Columbia, or the Territories or dependencies of the United States, additional compensation for nonpeeuniary damages for wrongful death of a decedent is recoverable. Punitive damages are not recoverable.

46 U.S.C. app. § 762(b)(1). Nonpeeuniary damages are defined as damages for loss of care, comfort, and companionship. 46 U.S.C. app. § 762(b)(2).

The Amendment’s application was retroactive and applicable to any death occurring after July 16, 1996.⁴ Pub.L. 106-181, Title IV, § 404(c) (Apr. 5, 2000). All, parties agree that if DOHSA is applicable, then it applies as amended.

On its face, Amended DOHSA seems capable of supporting both plaintiffs’ and defendants’ arguments. If the term “high seas” is seen as waters to which no sovereign could lay a claim, then the plaintiffs’ interpretation would indeed hold water. On the other hand, if the term “high seas” is viewed as encompassing all navigable sea waters “beyond 12 nautical miles from the shore” of the United States, then defendants’ interpretation would be correct. This court concludes that, given the guidelines established for resolution of a nautical statute’s meaning when its language is subject to differing readings, the latter reading, defendants’, is the only plausible one.

A. Principles of Maritime Statutory Interpretation

Under circumstances where the words of a nautical statute may not be susceptible to clear, plain reading, the United States Supreme Court has directed that a court define maritime terms of art according to their “established meaning” under the general maritime law existing at the time the Act was passed and in the case law to which Congress was then responding. McDermott International Inc. v. Wilander, 498 U.S. 337, 342, 354, 111 S.Ct. 807, 112 L.Ed.2d 866 (1991).

Under generally accepted principles of international law, the navigable sea is divided into three zones: inland waters; territorial waters extending seaward from a defined coastal baseline; and the high seas, international waters beyond the limit of a sovereign’s territorial sea. United States v. Louisiana, 394 U.S. 11, 22-23, 89 S.Ct. 773, 22 L.Ed.2d 44 (1969); see generally I. Brownlie, Principles of Public International Law at 183-84 (3d ed.1979); Webster’s New Collegiate Dictionary (1979) (defining “high sea” as “the open part of a sea or ocean especially] outside territorial waters”). Despite this ostensibly established meaning under international law, a review of legislative history, infra, 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.

Under McDermott, the first rule of construction of maritime statutes is that, in the absence of contrary indication, a court must assume that Congress intended a given term to have its “established meaning.” 498 U.S. at 342, 111 S.Ct. 807. However, if’ there i's 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. Id. at 354, 111 S.Ct. 807. For example, in justifying its definition for the term “seaman” under the Jones Act, the McDermott Court stated, “This rule best explains our case law ■ and is consistent with the pre-Jones Act interpretation of ‘seaman’ and Congress’ land-based/sea-based distinction.” Id. See also In re: Air Crash Off Long Island, New York, on July 17, 1996, 209 F.3d 200, 203 (2d Cir.2000) (hereinafter “TWA Flight 800”) (noting that the Supreme Court interpreted the word “seaman” in the Jones Act with reference to the Supreme Court decisions to which Congress was responding when it passed that Act).

Applying McDermott, this court must examine whether “high seas” reflected an established meaning as understood by Congress when it enacted the statute in 1920. If no such established meaning existed, the court must then look to a definition that best explains existing case law and is consistent with any known Congressional terminology distinctions. 498 U.S. at 354, 111 S.Ct. 807.

Additionally, 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.

In amending a statute, Congress is presumed to know the federal courts’ intervening interpretation of the statute it intends to amend. Where there is no indication that Congress intended to change the meaning courts have given to the statute, a court must presume that Congress did not intend a change. Ankenbrandt v. Richards, 504 U.S. 689, 700-01, 112 S.Ct. 2206, 119 L.Ed.2d 468 (1992) (“With respect to such a longstanding and well-known construction of the diversity statute, and where Congress made substantive changes to the statute in other respects, ..., we presume, absent any indication that Congress intended to alter this exception, ..., that Congress ‘adopt[ed] that interpretation’ when it reenacted the diversity statute.”); Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222, 227, 77 S.Ct. 787, 1 L.Ed.2d 786 (1957); Iraola & CIA, S.A. v. Kimberly-Clark Corp., 232 F.3d 854, 859-60 (11th Cir.2000). Courts must presume that Congress will use clear language if-it intends to alter an established understanding about what a law means; if-Congress fails to do so, courts must presume that the new statute has the same effect as the older version. Firstar Bank, N.A. v. Faul, 253 F.3d 982, 988 (7th Cir.2001) (citing Cottage Svgs. Ass’n v. Commissioner, 499 U.S. 554, 562, 111 S.Ct. 1503, 113 L.Ed.2d 589 (1991); NBD Bank, N.A. v. Bennett, 67 F.3d 629, 632 (7th Cir.1995)).

Further, the Supreme Court has held that re-enactment of a statute which has been given a consistent judicial interpretation generally includes the settled judicial interpretation. Pierce v. Underwood, 487 U.S. 552, 567, 108 S.Ct. 2541, 101 L.Ed.2d 490 (1988); Lorillard v. Pons, 434 U.S. 575, 580-81, 98 S.Ct. 866, 55 L.Ed.2d 40 (1978) (Congress in adopting a new law incorporating sections of a prior law normally can be presumed to have had knowledge of interpretation given to incorporated law.). From these cases is extracted the principle that 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.

1. The Less-than-Established Meaning of “High Seas” in DOHSA’s Legislative History

DOSHA, 46 U.S.C. app. § 761, was enacted by Congress in 1920 to resolve the anomaly created by the Supreme Court’s decision in The Harrisburg, 119 U.S. 199, 7 S.Ct. 140, 30 L.Ed. 358 (1886). See S.Rep. No.216, 66th Cong., 1st Sess., 3, 4, (1919); H.R.Rep. No.674, 66th Cong., 2d Sess., 3, 4 (1920) (noting that the rule of that case had been rejected by “[e]very country of western Europe,” and was a “disgrace to a civilized people”), cited in TWA Flight 800, 209 F.3d at 204; Moragne v. States Marine Lines, Inc., 398 U.S. 375, 397, 90 S.Ct. 1772, 26 L.Ed.2d 339 (1970). In The Harrisburg, a steamer collided with a schooner in waters between the coast of Massachusetts and the islands of Martha’s Vineyard and Nantucket, killing the first officer of the schooner. See id. at 199-200, 7 S.Ct. 140. Because the decedent’s widow and child did not bring suit within the applicable state statutes of limitations, they sought to recover under general maritime law. The Court held that, in absence of an applicable state statute, general federal maritime law did not provide a remedy in cases of wrongful death. The Court reasoned thát since there was no common law remedy for wrongful death on land, there could be none at sea. See id. at 212-13, 7 S.Ct. 140.⁵

Supreme Court decisions subsequent to The Harrisburg mitigated the harshness of that holding by giving more expansive interpretations to state statutes that provided recovery for deaths occurring upon navigable waters, even on the high seas, beyond a state’s territorial waters. In The Hamilton, 207 U.S. 398, 403, 28 S.Ct. 133, 52 L.Ed. 264 (1907), the Court held that a citizen of Delaware could bring suit in admiralty against' another under Delaware’s wrongful death statute, even though the death had occurred on the high seas, seven miles off the coast of Virginia. The Court reasoned that Delaware law defined the obligations of the parties, “even when personally on the high seas.” Id. The tension between the holdings in The Harrisburg and The Hamilton “created jurisdictional fictions and serious problems in choice’of law, that sometimes denied recovery altogether.” Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 235, 106 S.Ct. 2485, 91 L.Ed.2d 174 (1986)

1 . This is one of two motions seeking to dismiss the claims for punitive damages. The other motion, joined by defendants Swissair, SR Technics AG, Sairgroup, and Delta Airlines, Inc., seeks dismissal of all claims for punitive damages on the ground that such claims are precluded by the Warsaw Convention.

2 . Defendants' briefs do not address the significance, if any, of this distinction. They contend that DOHSA applies regardless of whether the accident occurred in foreign territorial waters or international waters. Canada extended its territorial sea from the three to the 12-mile mark from its shores in 1996. Oceans Act, S.C., part 1, ch. 31, § 4 (1996) (Can.); cf. Territorial Sea and Fishing Zones Act, R.S.C., ch. 22 (Í964) (repealed 1996) (Can.) (three-mile territorial sea).

3 . SR Technics, pursuant to a contract with Swissair, is responsible for ensuring the airworthiness, serviceability, and technical flight safety of the Swissair fleet. This includes, but is not limited to, responsibility for base maintenance, line maintenance, inspection, overhaul, alteration, and repair of aircraft, engines, and aircraft components. SR Tech-nics, formerly known as Swissair Technical Services Ltd., is the former Department of Technical Services of Swissair, formed as a separate corporate entity and performing, by contract, the maintenance, service, and repairs that Swissair would be obligated to do on its own. SR Technics also is 100 % owned by SAirServices, which in turn is 100 % owned by SAirGroup.

4 . July 16, 1996 is the day before the TWA Flight 800 crash.

5 . It was not until 1970 that The Harrisburg was overruled. In Moragne v. States Marine Lines, Inc., 398 U.S. 375, 388, 90 S.Ct. 1772, 26 L.Ed.2d 339 (1970), a unanimous Court recognized that a remedy existed for wrongful death under general maritime law, based upon the "wholesale abandonment” of the prohibition on wrongful death actions on land in England and in the United States.