Day & Zimmermann, Inc. v. Challoner

Daniel Nelms and Hawley Challoner (plaintiff) were United States servicemen who served in Cambodia. In 1970, Nelms was killed and Challoner severely injured when a howitzer round manufactured by Day & Zimmermann, Inc. (Day) (defendant) prematurely exploded. Day was incorporated in Maryland and had its principal place of business in Pennsylvania; Day manufactured the round in Texas. Challoner and the administrator of Nelms’s estate (administrator) (plaintiff) sued Day in federal court in Texas; federal jurisdiction was premised on diversity of citizenship. Under Cambodian law, Challoner and the administrator would have to prove that Day was negligent, but under the law of the potentially relevant American states, Challoner and the administrator could recover under a strict-liability theory. The district court applied Texas law, and a jury awarded damages to Challoner and the administrator. The United States Court of Appeals for the Fifth Circuit affirmed. Per the Fifth Circuit, under Texas’s choice-of-law rules, Cambodian law would apply to the administrator’s claim and likely would apply to Challoner’s claim. But the Fifth Circuit concluded that it should not apply the law of a jurisdiction that had no interest in the litigation and that, as an American court, it was meant to effectuate the laws of the United States. Day appealed.