Berniard v. Dow Chem. Co., No. 10-30497, 2010 U.S. App. LEXIS 16515 (5th Cir. La. Aug. 6, 2010).
We have all experienced personal short lived chemical releases in which no one seems to claim these silent but deadly chemical exposures.. However, in this case, the plaintiffs knew exactly who had released the deadly chemicals.
The U.S. Fifth Circuit affirmed the district court’s order remanding seven class actions filed pursuant to an accidental release of a potentially noxious chemical, holding that because the incident was short lived, the defendants’ bald exposure extrapolations based on census data of the various geographical areas referred to in the pleadings were insufficient to establish the likely number of persons affected by the release or, for those affected, the severity of their harm.
Several plaintiffs brought class actions against Dow Chemical and Union Carbide after an accidental release of ethyl acrylate (EA), a potentially noxious chemical, on the morning of July 7, 2009, at the defendants’ facility in Taft, Louisiana. Shortly thereafter, the St. Charles Parish Department of Emergency Preparedness closed some roads and evacuated residents and businesses from an area stretching some two miles eastward from the Union Carbide facility.
A total seven class actions were filed against the defendants; including the two, which were “raced to the courthouse” on the very day of the release. Of the seven actions, two actions were originally filed in the district court pursuant to CAFA, and the five actions filed in the state court were removed by the defendants under CAFA to the district court. The district court remanded all the actions to state court holding that the defendants failed to establish that aggregate recovery of damages by the class members would likely exceed $5 million.
In a consolidated appeal, the Fifth Circuit affirmed the district court’s remand order. The Fifth Circuit noted that Louisiana law, La. Code Civ. Proc. Ann. art. 893, prohibits allegations by tort plaintiffs of the quantum of the damages to which they are entitled. Thus, when the quantity of damages is not alleged by the plaintiff class, a defendant seeking to sustain removal may follow either of two tracks: (1) Adduce summary judgment evidence of the amount in controversy, or (2) demonstrate that, from the class plaintiffs’ pleadings alone, it is “facially apparent” that CAFA’s amount in controversy is met.
The defendants elected to follow the facially-apparent path.
To prove the amount in controversy, the defendants relied on census data of the various geographical areas referred to in the several pleadings and complaints, and compared the quantum of recovery in previously reported cases that involved occurrences and injuries similar to the kinds about which the instant class plaintiffs complained.
The Fifth Circuit remarked that the defendants’ bald exposure extrapolations were insufficient to establish the likely number of persons affected by the release or, for those affected, the severity of their harm. The Fifth Circuit examined several pleadings at issue, and concluded that even when properly aggregated, the nature, timing, geographical extent, numerosity of the affected population, and nature of damage allegedly caused by this isolated, quickly controlled, and geographically limited EA escape, as pleaded in the several state court petitions, did not make it facially apparent that the stakes plausibly exceeded $5 million.
Given the generalized and conclusional nature of the allegations of the several complaints, the Fifth Circuit remarked that it could not say that the defendants carried their burden of showing not only what the stakes of the litigation could be, but what they were in light of the plaintiffs’ demands. Specifically, the defendants methodology was speculative and unconvincing, and thus, they failed to present a plausible explanation of how the claims of the class plaintiffs could equal or exceed $5 million. They overstated the reach of the plaintiffs’ petitions by improperly equating the geographic areas in which potential plaintiffs might reside with the population of the plaintiff class itself. Further, the comparison of damage recovery in similar cases was too attenuated to satisfy their burden. Thus, the Fifth Circuit, reviewing the records de novo, aggregated the allegations of all seven consolidated cases avoiding double counting and repetition to discern the alleged geographic and temporal reach of the EA release, the likely population of the affected class, and the effect of the release on the limited number of potentially affected plaintiffs, and found that the defendants failed to satisfy their burden under their chosen path of facial apparency.
Finally, the Court remarked that the state court petitions which were hastily filed presented an oxymoronic picture. Although the pleadings presented an expansive view of the geographical reach of the chemicals, the number of persons likely affected, the seriousness and extent of the injuries caused by contact with the rapidly diluting EA, and the potential monetary value of the damages incurred by the affected parties, including future damages and punitive damages; those pleadings also contained minimizing allegations, such as shortly after the release of EA, the roads were closed for two miles and residents were evacuated, and that the incident was short lived, with normalcy being restored in short order.