Garcia v. Chiquita Brands Int'l, Inc.

48 F.4th 1202

Myriam Ramirez GARCIA, substituted in place of Antonio Gonzalez Carrizosa, et al., Plaintiffs,

Jane Doe 8, Plaintiff-Appellant,

v.CHIQUITA BRANDS INTERNATIONAL, INC., Defendant-Appellee,Chiquita Fresh North America LLC, substituted in place of Antonio Gonzalez Carrizosa, et al., Defendants.

No. 21-10211

United States Court of Appeals, Eleventh Circuit.

Filed September 8, 2022

Marco Benjamin Simons, Richard L. Herz, Marissa Vahlsing, EarthRights International, Washington, DC, Benjamin D. Brown, Agnieszka M. Fryszman, Cohen Milstein Sellers & Toll, PLLC, Washington, DC, Leslie M. Kroeger, Cohen Milstein Sellers & Toll, PLLC, Palm Beach Gardens, FL, Arturo Carrillo, Colombian Institute of International Law, Washington, DC, Judith Brown Chomsky, Law Offices of Judith Brown Chomsky, Elkins Park, PA, Paul L. Hoffman, Schonbrun Seplow Harris Hoffman & Zeldes, LLP, Hermosa Beach, CA, for Plaintiff-Appellant.

Michael L. Cioffi, Trial Attorney, Thomas H. Stewart, Blank Rome, LLP, Cincinnati, OH, Frank Anthony Dante, Melissa Fundora Murphy, Blank Rome, LLP, Philadelphia, PA, Adam V. Orlacchio, Blank Rome, LLP, Wilmington, DE, James M. Garland, Covington & Burling, LLP, Washington, DC, Anthony R. Yanez, Wargo French & Singer, LLP, Miami, FL, for Defendant - Appellee.

Before Newsom, Marcus, Circuit Judges, and Covington, District Judge.^*

Marcus, Circuit Judge:

This action is about many things. It's about one U.S. company facing over four thousand accusations of criminal conduct in a foreign country. It's about a putative class action that lasted more than a decade before the plaintiffs moved for class certification. But for us today, it's largely about one issue: whether we apply federal law or a foreign country's law on the availability of equitable class tolling in a Rule 23 class action. At bottom, it's about the reach of Erie Railroad Company v. Tompkins .¹

For almost a decade, Chiquita Brands International, Inc. ("Chiquita") funded a violent, paramilitary terrorist group operating in Colombia. Chiquita's near-decade-long support for the terrorist group spawned over a decade's worth of litigation. One putative class action under Federal Rule of Civil Procedure 23, Cardona v. Chiquita Brands International, Inc. , was filed against Chiquita in 2007, and it included only state and Colombian law claims after the plaintiffs’ federal claims were dismissed by a panel of this Court on interlocutory review.²

After class certification in Cardona was denied in 2019, the Plaintiffs here -- who were unnamed class members in Cardona -- filed this Complaint in federal district court in New Jersey, raising state and Colombian law claims. The case was eventually transferred by the Judicial Panel on Multidistrict Litigation ("JPML") to the Southern District of Florida. That court dismissed the Colombian law claims as time-barred, despite the Plaintiffs’ contention that they should have a right to equitable tolling under the rule announced by the Supreme Court in American Pipe³ -- a federal, judge-made rule that tolls the statute of limitations for the claims of unnamed class members while a putative Rule 23 class action is pending certification. The Plaintiffs challenge that determination, and they also say that the district court abused its discretion in denying their request to amend the Complaint to (1) support their claim for minority tolling,⁴ and (2) add claims under the Alien Tort Statute ("ATS"), 28 U.S.C. § 1350, et seq .

We affirm in part, reverse in part, and remand for further proceedings consistent with this opinion. Although there is a square conflict between Colombian law and federal law in this diversity action, under Erie , Colombia's law prevails over the rule announced in American Pipe . However, the district court abused its discretion in dismissing the Plaintiffs’ Complaint with prejudice without having allowed the Plaintiffs the opportunity to amend to support their minority tolling argument, although the district court correctly denied the Plaintiffs’ application to amend their Complaint to include Alien Tort Statute claims.

I.

The facts are straightforward. From 1997 to 2004, the Auto-defensas Unidas de Colombia ("AUC") -- a violent paramilitary group in Colombia designated by the U.S. government as a Foreign Terrorist Organization ("FTO") -- killed, tortured, and assaulted thousands of Colombian civilians. Soon after Chiquita pleaded guilty in the District Court for the District of Colombia to one count of engaging in transactions with a specially-designated global terrorist group (the AUC) in violation of 50 U.S.C. § 1705(b), family members of banana workers and others who had been targeted and killed by the AUC filed a putative federal class action in federal district court in New Jersey against Chiquita on July 19, 2007 for its role in funding, arming, and otherwise supporting AUC. The Cardona plaintiffs brought a Rule 23(b)(1) class action, alleging claims under the ATS, the Torture Victims Protection Act ("TVPA"), and pursuant to New Jersey and Colombian law. In 2008, the JPML centralized the Cardona action and several similar actions in the Southern District of Florida.

In June 2011, the district court largely denied Chiquita's first motion to dismiss in the Cardona action, but Chiquita appealed that determination to our Court on an interlocutory basis. A panel of this Court dismissed the ATS and TVPA claims. See Cardona , 760 F.3d 1185 (11th Cir. 2014). The Cardona plaintiffs then filed a second amended complaint in November 2012, naming Chiquita and several of its former executives and employees as individual defendants. In March 2017, the Cardona plaintiffs sought to file a third amended complaint to add several hundred additional named plaintiffs -- the same Plaintiffs here. But the district court denied that motion, given the "advanced stage of the proceeding and imminent scheduling of the matter for trial." Class certification was denied on May 31, 2019. No longer putatively represented by the named plaintiffs in the Cardona action, the Plaintiffs sued Chiquita Brands in district court in New Jersey on March 25, 2020. Complaint, Jane Doe 8, et al. v. Chiquita Brands Int'l, Inc. , Civ. No. 20-3244, DE 1, 2020 WL 1561707 (D.N.J. Mar. 2020). The Complaint asserted various claims under New Jersey law and violations of Colombian civil and criminal law.⁵ The JPML transferred the case to the Southern District of Florida.

The Plaintiffs’ case was cut short. The district court granted Chiquita's motion to dismiss with prejudice, dismissing the remaining claims brought under Colombian law as time-barred by Colombia's ten-year statute of limitations because the filing of the Cardona action did not toll it. The district court also dismissed all New Jersey state law claims on extraterritoriality grounds -- a decision that the Plaintiffs do not appeal.

The court concluded that the Plaintiffs’ Colombian law claims were time-barred after performing a two-step choice-of-law analysis. For starters, the district court rejected the Plaintiffs’ argument that, under American Pipe , the Colombian statute of limitations was tolled for the twelve years while class certification was pending in Cardona . It explained that the judge-made rule announced in American Pipe concerned the tolling of the statute of limitations only for claims arising under federal law for Rule 23 purposes. The district court agreed with many other federal courts, which have held that Erie compels the conclusion that state class tolling rules -- not the rule announced in American Pipe -- control in diversity class actions.

After finding that American Pipe did not apply to state law claims, the district court applied New Jersey choice-of-law rules because the case had originally been filed in New Jersey. The court observed that the laws of New Jersey and Colombia were in "true conflict" because, although one New Jersey appellate court had embraced American Pipe ’s equitable tolling, Colombia had not recognized a similar principle. Considering that Colombian law claims were at issue, and the litigation's only connection to New Jersey was that Chiquita was incorporated there, the court concluded that Colombia had "a more significant relationship" to the parties in the litigation, and therefore, Colombian law applied. The bottom line, the court reasoned, is that Colombia's ten-year statute of limitations barred the Plaintiffs’ claims.

The Plaintiffs moved to Alter or Amend the Final Judgment of Dismissal with Prejudice under Rule 59(e) of the Federal Rules of Civil Procedure. They sought to include additional facts to establish that some of the Plaintiffs still were entitled to minority tolling and to add claims arising under the Alien Tort Statute.

The district court rejected the application to amend. As for minority tolling, the court explained that the Plaintiffs failed to previously raise minority tolling as a method of avoiding the limitations bar in either their Complaint or their motion to dismiss, so any application to amend the Complaint on those grounds had been waived. The district court reasoned that it was clear from the face of the Complaint that all of the claims were barred by Colombia's statute of limitations, so the Plaintiffs needed to explain how those minor Plaintiffs’ claims were still live -- and they failed to do so. As for the Plaintiffs’ ATS claims, the court denied the application on futility grounds.

The Plaintiffs timely appealed the dismissal of their Colombian law claims and the district court's denial of their request to amend to support their minority tolling argument and to add ATS claims.

II.

We start with the district court's dismissal of the Plaintiffs’ Colombian law claims for failure to state a claim, which we review de novo . Randall v. Scott , 610 F.3d 701, 705 (11th Cir. 2010). We also review de novo a district court's choice-of-law rulings, Strochak v. Federal Ins. Co. , 109 F.3d 717, 719 (11th Cir. 1997),...