Consumer Class Actions and Mass Torts : Class Action Lawyer & Attorney : J. Russell Jackson : Skadden Law Firm : Complex Class Actions : Consumer Class Actions & Mass Torts Law Blog

If I had any competency at all with computers, I would have some background music for this post:  the 1980 hit "One in a Million You" by Larry Graham (former bassist for Sly and the Family Stone and the father of the slap bass style of playing).

Featured today is the Sixth Circuit's recent decision in Hirsch v. CSX Transportation, Inc., No. 09-4548 (6th Cir. Sept. 8, 2011), in which some residents of Painesville, Ohio brought a class action against a railroad for damages allegedly resulting from a train derailment and three-day fire during which 1,300 people were evacuated from homes within a half-mile radius of the crash.  The class brought claims for nuisance, strict liability, trespass, negligence and medical monitoring.  The trial court granted a motion to dismiss the first three claims, but allowed discovery to go forward on the negligence claim and medical monitoring remedy.

CSX had stipulated to a breach of duty when the train derailed, so the only remaining elements of a negligence claim were proximate cause and injury.  The defendant moved for summary judgment, which the trial court granted.  Plaintiffs had at least four experts to advance their theory that class members had been exposed to dioxin from the fire at levels above the EPA's threshold of acceptability, thereby increasing their cancer risk by one in a million.

The Sixth Circuit affirmed the grant of summary judgment.  It began by noting the procedural posture of the case.  The defendants had not challenged the admissibility of plaintiffs' expert testimony under Daubert.  Rather, the district court had granted summary judgment based on the defendant's challenge to the sufficiency of the expert evidence.  As the court noted, "[e]ven where an expert's evidence is ruled admissible under the Daubert standards, a district court remains free to decide that the evidence amounts to no more than a mere scintilla."  Slip op. at 4-5.

Plaintiff's expert opined that although the class members had not sustained any physical injury to date, their relative risk of developing cancer had been increased by one chance in a million.  The Sixth Circuit held that this slight increase in cancer risk was not enough for a reasonable physician to order a medical surveillance program.

Even the "one-in-a-million" opinion was based on speculation about the amount of exposure to dioxin, as well as its source.  (Dioxin occurs naturally and exists in the environment at background levels.)  The court explained:

[W]e are left with a report speculating (based on speculation) that the Plaintiffs might have been exposed to quantities of dioxin somewhere in the ballpark of 43.9 ppt, and that their risk therefore might (or might not) be somewhere around 50% of a one in a million additional risk of developing cancer. . . .

. . . If something has a one-in-a-million chance of causing cancer, then it will not cause cancer in 999,999.  For some perspective, the National Safety Council estimates a person's lifetime risk of dying in a motor vehicle accident as 1 in 88.  The lifetime risk of dying in "air and space transport accidents" is roughly 1 in 7,000.  The risk of being killed by lightning is roughly 1 in 84,000, while the risk of being killed in a "fireworks discharge" stands at around 1 in 386,000.  These risks--of death, not disease--are all much smaller than what the plaintiffs allege in this case:  lifetime odds of developing cancer at 50% of 1 in 1,000,000.  To even approach that number, we can look at the average person's risk of dying from bathtub drowning in any given year (1 in 840,000).

Slip op. at 6-7 (citations omitted).

The Sixth Circuit concluded that "the Plaintiffs have alleged only a risk that borders on legal insignificance, have failed to produce evidence establishing even this hypothetical risk with any degree of certainty, and have demanded a jury trial based upon their expert's review of this evidence and conclusory statement of the relevant legal standard."  Slip op. at 8.  Accordingly, it affirmed the summary judgment for the defendant.

The Hirsch opinion provides a couple of excellent resources for risk information.  One is the National Safety Council's "Injury Facts," and the other is the Harvard Center for Risk Analysis.

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Cases brought by public water authorities often present special challenges, particularly where the party sued is not a neighboring landowner, but instead is a product manufacturer that stands far removed from any alleged contamination.  Federal preemption sometimes can be an issue.  Proximate causation is often problematic, since the presence of any alleged contaminant can only have occurred through the conduct of independent third parties, like neighboring farmers, who may or may not have followed the manufacturer's instructions and warnings.

The recent opinion in City of Greenville v. Syngenta Crop Protection, Inc., 2010 WL 4791674 (S.D. Ill. Nov. 18, 2010) raises different issues, including the adequacy of pleadings.  The plaintiffs in the case are public water authorities from various states.  They sued to recover the cost of testing and monitoring their water for atrazine, a chemical used in Syngenta's herbicide.  They also want the cost of installing a carbon-based filtration system to remove atrazine from the water, as well as punitive damages.  

Plaintiffs assert four causes of action:  (i) trespass onto plaintiffs' rights to possess raw water; (ii) public nuisance for interfering with the use and enjoyment of the raw water; (iii) strict liability, and (iv) negligence for breaching duties to avoid contaminating plaintiffs' water sources.  

The defendant moved to dismiss, and the court ultimately mostly denied the motion.  The court began its analysis by considering the defendant's argument that the plaintiffs had not properly pled any injury -- and thus lacked standing -- because they did not plead that their "finished water" (or post-treatment water) contained atrazine at maximum contaminant levels ("MCLs") higher than the EPA's set limit of 3 parts per billion on an average annualized basis.  Without contamination at such levels, the defendant argued, the plaintiffs had not demonstrated that they were impaired in their ability to provide potable water to the public.

The court rejected this argument and sided with plaintiffs, who had cited an opinion from the MTBE Products Liability Litigation.  The court reasoned that where the presence of atrazine at any level makes the plaintiffs' job of providing potable water more difficult and costly, the plaintiffs have suffered an injury regardless of whether the MCL threshhold has been reached.  The court remarked:

[I]t seems an extremely bad rule to require a public water supplier to provide overly contaminated water to the public before it can seek redress from one responsible for the contamination.  Thus, the Court agrees with the In re:  MTBE court that a water provider may demonstrate an injury in fact even if its finished water does not exceed an MCL if its use of the water to meet its statutory obligations to the public becomes more costly because of a defendant's conduct.

Id. at *4.  The court warned, however, that on summary judgment, the plaintiffs will have to show a specific, immediate threat of atrazine in excess of the MCL to maintain standing to sue.  Id. at *5.

Next, the court considered the defendant's challenge to the strict liability claim of the Indiana plaintiffs.  It summarily dismissed the strict liability claim because Indiana law does not allow strict liability in design defect cases; design defect is measured by a negligence standard.  Thus, the court granted the defendant's motion on that count against the claims of the Indiana plaintiffs.  Id. at *6.

The court next analyzed whether the economic loss doctrine barred the tort claims of the remaining plaintiffs under Ohio, Iowa, Kansas, Missouri and Indiana law.  The court concluded that it did not.  The court recited a basic description of the economic loss doctrine, and then concluded that the "economic loss rule simply does not apply in this case because the plaintiffs have alleged that the defendants are responsible for damages to their property rights in their raw water sources by causing those sources to be contaminated by atrazine."  Id. at *8 (citing MTBE).

Finally, the court refused to dismiss the plaintiffs' claims for future damages and refused to apply the statute of limitations at the motion to dismiss stage.

So, the City of Greenville plaintiffs live to fight another day.  But there are many, many more legal defenses that they must surmount, and it remains to be seen whether the claims can be tried together as a class action.  This is a litigation worth monitoring, and we'll report on further developments as they arise.

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Senior US District Judge W. Harold Albritton recently issued an opinion in a nuisance case that once again reminds us of the importance of having a class that is capable of objective, ascertainable definition at the outset of the litigation.   See Benefield v. International Paper Co., Civ. A. No. 2:09cv232-WHA, Slip op. (M.D. Ala. Oct. 20, 2010). 

In Benefield, the plaintiffs alleged that the defendant's paper mill had discharged hazardous substances over the course of many years, resulting in property damage to properties within a two-mile radius of the facility.  The class was defined as all people who, as of the date of the filing of the Complaint, owned real property located within two miles of the facility which was contaminated by what was released from the defendant's facility and who suffered as a result a diminution in property value of $100 or more.  Slip op. at 2.  There were a number of exclusions, including people who suffered personal injuries and people who were litigants or class members in other similar cases.

The court denied class certification, beginning its analysis with the problems with the class definition.  Establishing that each property was contaminated would require individualized proof, the court concluded, as would determining whether the property value was diminished by more than $100.  Slip op. at 7-8.  Although the court ultimately concluded -- unlike many other courts -- that the admissibility of expert testimony was not ripe for adjudication at the class certification stage, the court focused on the weaknesses in the plaintiffs' experts' blanket conclusions and ill-conceived methodologies in rejecting the class definition:

In short, while the Plaintiffs have argued, correctly, that this court should not engage in any merits determination in determining whether the class should be certified, the Plaintiffs have asked the court to find facts, based on disputed evidence, to determine who is in the class.  The court concludes, therefore, that it is not administratively feasible for the court to determine whether a particular individual meets the class definition. 

Slip op. at 8 (citation omitted).  The court also noted that the exclusions carved out of the class definition also presented their own problems:  "That [personal injury] exclusion will require a determination of which people within the geographic area who own residential property also have personal injuries caused by releases from the Facility, which itself poses causation issues, and therefore makes the class definition improper."  Id. at 9.

The court went on to consider the standing of one plaintiff, who could not establish by deed or will that he actually had an ownership interest in his property.  The court concluded that he lacked standing to assert claims on behalf of property owners.  (He had asserted some damage to personal property as well, but the court indicated that this presented typicality/adequacy of representation problems, although it might cure his personal standing problem.)

The other plaintiff presented multiple typicality and adequacy problems.  First, he jointly owned his property with his wife, and his wife was the plaintiff in a similar action that had been carved out of the class definition.  Moreover, after filing the class certification motion, plaintiff filed an amended complaint that asserted claims for public nuisance, private nuisance, and fraud.  Yet he did not seek class certification for those claims.  This led the court to conclude that his adequacy was "undermined by the pendency of those claims."  Slip op. at 15 ("because Johnson's claims are factually the same as only some of the putative class, he is pursuing some damages not sought by the entire class, and he apparently seeks to recover on theories not asserted on behalf of the entire class, his claims are not typical, and he is not an adequate class representative").

In analyzing the predominance requirement of Rule 23(b)(3), the court observed that the claims for public nuisance, private nuisance, abnormally dangerous activity, and fraud likely would require "highly individualized determinations."  Slip op. at 19.  Moreover, there were significant individualized damages issues that -- when combined with the individualized causation issues -- counseled against certification.  Id. at 21. 

The court also found the superiority requirement lacking, particularly in light of the other actions already pending.

Benefield is a good reminder that how one defines the class -- and who is excluded from the class -- matters, and can prove fatal to a putative class action.

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On Monday the Fourth Circuit issued an opinion in a public nuisance suit that contains important legal reasoning that is likely to impact global warming litigation.  See State of North Carolina v. Tennessee Valley Authority, No. 90-1623, Slip op. (4th Cir. Jul. 26, 2010).  To be clear, the suit against the TVA was not a global warming case.  Rather, it was a public nuisance case in which the State of North Carolina sought to use public nuisance theory to impose restrictions on Alabama and Tennessee energy plants to reduce the amount of sulfur dioxide and nitrous oxides that they emitted, even though the plants were operating within their state and federal permits.

The trial court had entered judgment for North Carolina, declaring the emissions a public nuisance and issuing an injunction requiring the Tennessee and Alabama plants to install expensive scrubber plants to remove sulfur dioxide and nitrous oxide from their emissions.

The Fourth Circuit Court of Appeals -- in a unanimous panel opinion -- reversed the trial court.  The court premised its opinion on some fundamental precepts that should discourage other courts from using public nuisance theory to regulate air pollution.

First, the court held that there is a strong presumption that a common-law public nuisance theory is preempted by the complex framework of federal and state statutes and regulations governing air pollution.  The court explained that comprehensive framework, and then observed:

The system of statutes and regulations addressing the problem [of air pollution] represents decades of thought by legislative bodies and agencies and the vast array of interests seeking to press upon them a variety of air pollution policies.  To say this regulatory and permitting regime is comprehensive would be an understatement.  To say it embodies carefully wrought compromises states the obvious.  But it is the work of many, many people, and it is in place.

. . . [The district court's] decision threatens to scuttle the extensive system of anti-pollution mandates that promote clean air in this country.  If courts across the nation were to use the vagaries of the public nuisance doctrine to overturn the carefully enacted rules governing airborne emissions, it would be increasingly difficult for anyone to determine what standards would govern.  Energy policy cannot be set, and the environment cannot prosper, in this way.

Slip op. at 10-11.  The court continued:

It ill behooves the judiciary to set aside a congressionally sanctioned scheme of many years' duration -- a scheme, moreover, that reflects the extensive application of scientific expertise and has set in motion reliance interests and expectations on the part of those states and enterprises that have complied with its requirements.  To replace duly promulgated ambient air quality standards with standards whose content must await the uncertain twists and turns of litigation will leave whole states and industries at sea and potentially expose them to a welter of conflicting court orders across the country.

Slip op. at 16.

As the court recognized, public nuisance standards are blunt tools that are often vague and indeterminate.  This is, in part, due to the fact that public nuisance is the Swiss Army knife of the common law, being pressed into service in a pinch to address loud parties, prostitution, obstacles in highways, bullfights, and smells from pig farms.  Applying International Paper Co. v. Ouellette, 479 U.S. 481 (1987), the court reasoned:

We can state . . . with assurance that Ouellette recognized the considerable potential mischief in those nuisance actions seeking to establish emissions standards different from federal and state regulatory law and created the strongest cautionary presumption against them.

Slip op. at 19.  Thus, where Congress has granted states a role in the federal regulatory regime and permitting process, both field and conflict preemption principles come into play, and at a minimum they prevent the use of common law public nuisance to create a wholly different role for states (like North Carolina).  As the court explained, the fact that the federal statute has a generic savings clause does not change this analysis.  Slip op. at 20.

The Fourth Circuit's opinion has an entire section devoted to the difference between the branches of government and their institutional capabilities.  It recognizes that agencies -- with the notice and comment process -- are better equipped to regulate in a forward-looking mode and to digest an entire body of science to create empirically-based regulations.  See slip op. at 21-23 ("[W]e doubt seriously that Congress thought that a judge holding a twelve-day bench trial could evaluate more than a mere fraction of the information that regulatory bodies can consider.").  The court instructed:

It is crucial therefore that courts in this highly technical arena respect the strengths of the agency processes on which Congress has placed its imprimatur.  Regulations and permits, while hardly perfect, provide an opportunity for predictable standards that are scientifically grounded and thus give rise to broad reliance interests.

Slip op. at 23-24.

These fundamental principles articulated by the Fourth Circuit are not limited to cases involving sulfur dioxide or nitrous oxide.  They would apply equally to global warming litigation, and they highlight the inherent inadequacy of the judicial branch and the common law to provide the sort of empirical, forward-looking regulations that would promote stability and predictability in this important area of public policy.

The Fourth Circuit's opinion also articulated a basic principle of public nuisance law that is an independent reason why the TVA could not be held liable for creating a public nuisance:  where the conduct complained of has been expressly approved by the applicable federal and/or state authorities, it cannot be a public nuisance as a matter of law.  Slip op. at 29-30, 32 ("If TVA is in compliance with the more demanding federal EPA requirements and state law SIPs, it cannot be in violation of less-stringent state law nuisance standards.").

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Welcome back from the Independence Day holiday!  You'll note the shameless photo of the three amigos that ruled my home over the holiday weekend.  But after a holiday break, it's back to business.

Last month the Ohio Supremes issued an opinion firmly establishing that, in order to plead damages for annoyance and discomfort in a nuisance case, the plaintiff must plead some form of physical discomfort.  In Banford v. Aldrich Chemical Co., 2010 WL 2330342 (Ohio June 9, 2010), the defendant ran a chemical company that distilled nitric oxide, a hazardous chemical.  On September 21, 2003, the defendant had an explosion at its plant that caused a shock wave in the surrounding neighborhood.  No neighboring property owner was physically injured, but they were evacuated for 24 hours as a safety precaution.  Approximately 3 months later, the plant shut down. 

Shortly thereafter, a group of neighbors brought a class action against the defendant for negligence, strict liability for engaging in an ultrahazardous activity, negligent infliction of emotional distress, and nuisance.  The trial court dismissed the NIED claim, holding that plaintiffs failed to present sufficient evidence of severe and debilitating emotional harm.

The trial court had certified a narrow class of neighboring property owners and set forth a four-phase trial plan that would consider:  (1) liability, (2) individual damages, (3) liability for punitive damages, and (4) amount of punitive damages.  Prior to trial, the defendant conceded liability, thus eliminating Phase 1 of the trial.

In phase 2 of the trial, plaintiffs put on evidence of their damages.  One plaintiff, who was ten at the time of the explosion, testified that after the explosion, she was sent to a basement crawl space for five or six minutes, and then was evacuated and spent the night at her grandparents' house.  She testified that "it was really weird," "everybody was upset," and "it was just really awkward."  She was awarded $100 in annoyance and discomfort damages.  She was the only one of the plaintiffs who appealed the judgment, arguing that her fear and subjective concerns about herself and her parents were compensable elements of annoyance and discomfort damages.  She also argued that the trial court erred by excluding evidence of prior accidents at the plant and statements about them at subsequent town meetings.

The Ohio Supremes held that a plaintiff may not, under Ohio law, recover for a "trifling annoyance or unsubstantiated or unrealized fears."  Id.  at 4.  Rather, it must be an "appreciable, substantial tangible harm resulting in actual material, physical discomfort."  The court looked to prior nuisance decisions:

A physical component is inferred in much of our case law that discusses damages for annoyance and discomfort.  In the cases that have awarded damages for annoyance and discomfort, the type of nuisance had affected a person's senses, resulting in physical discomfort.  "Cases supporting recovery for personal discomfort or annoyance involve either excessive noise, dust, smoke, soot, noxious gases, or disagreeable odors as a premise for awarding compensation." . . . These conditions affect one's sight, sound, smell, hearing or touch, which may cause a physical discomfort.

In cases in which courts have determined that circumstances did not rise to the level of nuisance and have refused to award damages for annoyance and discomfort, the offending situation had no effect on the senses and thus no physical component of annoyance.

It has long been recognized that a nuisance must materially interfere with physical comfort.  Consequently, we hold that in order to recover damages ofr annoyance and discomfort in a nuisance claim, a plaintiff must establish that the nuisance caused physical discomfort. 

Id. at *5 (citations omitted).

Notably, a person can pursue emotional distress damages in Ohio without proving the manifestation of a physical injury, but the distress must be severe and debilitating and does not encompass mere upset or hurt feelings.  Id. at *6.  The trial court had dismissed the emotional distress claim for failing to provide evidence of severe emotional distress.

The trial court also excluded evidence of a 1995 explosion and a 1998 chemical leak at the plant, as well as evidence of discussions of these incidents at 2003 town meetings after the 2003 explosion.  The Ohio Supremes affirmed this ruling as being within the trial court's discretion.  The nuisance in this instance arose from a single explosion and was not ongoing.  Accordingly, the trial court was within its discretion to exclude such evidence under Rule of Evidence 403, particularly where damages were not based on fear of future injury.

The Ohio Supreme Court's approach is somewhat restrictive, but no more than is necessary given the malleable nature of the nuisance causes of action generally.  Requiring physical discomfort is an appropriate limitation on what otherwise might become unlimited liability.

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Regular readers may remember that last fall, a three-judge panel of the Fifth Circuit Court of Appeals quietly issued an opinion on a Friday afternoon in Comer v. Murphy Oil Co., holding that plaintiffs who blamed Hurricane Katrina on climate change caused by energy, mining and oil companies had standing to bring a claim and were not precluded by the political question doctrine.  I discussed that opinion here.

Not surprisingly, the defendants petitioned for rehearing en banc.  The Fifth Circuit granted the petition, but before oral argument could be held, another judge recused, making the total number of unrecused judges less than a majority of the court.  The Fifth Circuit  directed the parties to address what should be done where there was no longer a majority of the court available to hear the en banc appeal.

True to form, the Fifth Circuit once again dropped an important opinion in this case on Friday afternoon, and it managed to garner virtually no media attention over the weekend.

The panel of eight judges in Comer v. Murphy Oil Co. issued an opinion that surprised most of those who had made predictions about what the Fifth Circuit might do:  it dismissed the appeal, observing that the prior opinion and judgment of the three-judge panel had been properly vacated when nine judges voted to rehear the case en banc.  Now that there were only 8 judges, the majority reasoned, they did not have a quorum to hear the appeal and could do nothing more than dismiss it.  They could not re-instate the three-judge panel's opinion, they reasoned.  And so that panel's prior opinion and judgment remain vacated.  (Most commentators had predicted the Fifth Circuit would leave the three-judge panel's opinion and judgment in place.)

This, of course, creates a tremendous mess for those seeking to appeal to the U.S. Supreme Court.  And it threatens to overshadow the underlying substantive legal issues with a potpourri of procedural arguments.

A good preview of those arguments can be found in the dissents.  The three judges who had authored the original Comer decision made impassioned arguments as to why the court could hear the case.  Judge W. Eugene Davis (a Reagan appointee), submitted a dissent in which Judge Carl E. Stewart (a Clinton appointee) joined, agreeing that the Fifth Circuit had lost its quorum of judges to hear the case en banc, but arguing that the rule vacating an opinion once rehearing was granted was never meant to permanently vacate an opinion if the en banc appeal could not be heard.  He also urged that the acting Chief Judge had the authority to request the appointment of a Circuit Judge from another Circuit to sit by designation.

Judge James L. Dennis (a Cllinton appointee who wrote the original Comer decision) wrote a much longer dissent.  Judge Dennis stressed the fact that the Fifth Circuit has a duty to decide all appeals that come before it.  By leaving the prior decision vacated, the court was breaching its duty to decide, he argued. 

The court had plenty of ways in which to rehear and decide the appeal, Judge Dennis admonished.  First, its reading of the statute requiring a quorum was wrong, he said.  The rule only requires a quorum of non-disqualified judges, not all judges.  Thus, the 8 remaining judges could decide the appeal, he said.

Moreover, he agreed with Judge Davis that the Acting Chief Judge had the authority to request appointment of a judge to sit by designation.

The Fifth Circuit has a vacancy, Judge Dennis reminded the court, and thus it also could delay decision on the matter until President Obama fills the vacancy.  (The majority had rejected this approach as possibly taking months, and even then presenting the possibility that the new appointee would have a recusal problem.)

Judge Dennis also included a lengthy discussion of the so-called Rule of Necessity, in which judges who ordinarily would recuse themselves from a matter decline to do so where doing so would prevent the ability of the court to decide the question.  Judge Dennis encouraged the court to invite those judges who had recused themselves to re-visit the question in light of the Rule of Necessity.

Judge Dennis took issue with the majority's argument that it had no power to do anything other to dismiss the appeal.  Indeed, he argued that dismissing the appeal was in fact a decision not to take a number of different courses of action:

[T]he majority's dismissal in this case is a decision to reject several legally valid courses of action, not a merely ministerial application of settled rules as the majority suggests.  It is therefore inconsistent with the majority's own rationale, which is predicated on the claim that we lack a quorum and therefore lack the power to take any action in this case. . . .  The majority instead has decided to dismiss a case over which we have jurisdiction, thereby violating the longstanding rule, dating back to Cohens v. Virginia, that we lack the power to decline to exercise the jurisdiction that has been conferred on us.  Because this court has an absolute duty to render a decision in this appeal, I respectfully dissent.

Dennis' dissent at 23.

You can bet that the certiorari petitions to the U.S. Supreme Court will be chock full of arguments as to why the Fifth Circuit was wrong not to decide the Comer appeal.  But the real underlying question remains more important:  Do victims of natural disasters have standing to sue a subset of those who allegedly contribute to "climate change" based on the hypothesis that the disaster might have been milder if the ocean had been a few degrees cooler?  The causal chain on such climate change theories are simply too attenuated to support legal standing.  And the sooner we get a definitive ruling from the Supreme Court on that issue, the better off we'll be.

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Increasingly, foreign plaintiffs want to use US courts to adjudicate disputes that arose overseas.  The Texas Court of Appeals' decision in Lalila v. Parker Drilling Co., 2009 WL 618248 (Tex. App. -- Houston [1st Dist.] Mar. 12, 2009), is a good example of a court's use of the doctrine of forum non conveniens to control its docket and avoid adjudication of such disputes.

In Lalila, 766 Bangladeshis sued a number of defendants in Texas state court over two gas well explosions in Tangratila, Bangladesh, asserting causes of action in negligence, nuisance, trespass, and conversion.  The Texas defendants moved to dismiss for forum non conveniens.  The trial court granted the motion, which the appellate court reviewed for abuse of discretion.

Texas is one of the few states to have codified the rules relating to forum non conveniens.  That statute provides that if an act or omission occurring in Texas was a proximate or producing the injury, then forum non conveniens dismissal is not available.  The court noted, however, that both proximate and producing cause require "causation in fact," which "means the defendant's act or omission was a substantial factor in bringing about the plaintiff's injury, which would not otherwise have occurred."  The court reviewed the various acts that plaintiffs alleged occurred in Texas (design of the rig and parts, negligent supervision of the gas well project), concluding that plaintiffs' complaint never connected them up to the injuries suffered in Bangladesh in such a way as to meet the "causation in fact" requirement.

The court then proceeded to evaluate Bangladesh as a forum.  The court rejected plaintiff's criticism of the courts as corrupt, saying the evidence was based on hearsay from only three Bangladeshi attorneys.  The court gave little weight to the fact that Bangladeshi courts do not have a class action procedure, noting that it has joinder and is a judicial system based on English common law that has the types of torts asserted by Lalila.

The court also noted the legal inability and prohibitive costs of bringing witnesses from Bangladesh and translating their testimony, as well as the fact that the vast majority of evidence resides in Bangladesh.  The court concluded that the balance of public and private interests clearly weighed in favor of Bangladesh.  And thus, the court concluded that the trial court did not abuse its discretion in dismissing the case for foreign non conveniens.

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A recent decision from a federal district court in Massachusetts raises interesting issues regarding the effect of rulings in competing class actions.  In Gintis v. Bouchard Transportation Co., 2009 WL 95661 (D. Mass. Jan. 15, 2009), a tugboat and barge had strayed off course while navigating a shipping canal.  They collided with a reef, resulting in up to 98,000 gallons of oil being spilled into Buzzards Bay, contaminating real property all along the bay and requiring cleanup.

Buzzards Bay property owners had sued the defendants in both state and federal court in Massachusetts.  The state court had declined to certify a class of propertyowners from across the bay, finding that the named representatives from the town of Mattapoisett could not adequately represent the interests of a baywide class.  The state court ultimately did, however, certify a class of Mattapoisett residents.

In federal court, both the plaintiffs and defendants sought to use the state court decision offensively, urging that the order merited collateral estoppel effect.  The defendants sought to hold plaintiffs to the state court's determination that a baywide class was not certifiable.  The plaintiffs sought to hold defendants to the state court's determinations on the individual elements of Rule 23.

The court in Gintis rejected both assertions of collateral estoppel.  The court acknowledged that the Seventh Circuit has held that a court's denial of certification can be conclusive against absent proposed class members.  Id. at *2 (citing In re Bridgestone/Firestone, Inc. Tires Prods. Liab. Litig., 333 F.3d 763, 768 (7th Cir. 2003)).  But that can only be the case where the absent class members were adequately represented by class counsel.  Because the state court had held that the named plaintiffs there could not adequately represent other bay propertyowners, the state court's decision denying certification of a baywide class could not have collateral estoppel effect.

The court in Gintis similarly rejected the plaintiffs' attempt to give nonmutual offensive collateral estoppel effect to the state court's conclusions about predominance, superiority, and other elements of Rule 23.  It reasoned that plaintiffs could not easily have joined the earlier state court action, and further it would be fundamentally unfair to apply collateral estsoppel to defendants because the state court's determinations on the elements of Rule 23 were made based on assumptions about a much smaller and manageable Mattapoisett-only class.

Having dispensed with the collateral estoppel arguments, the district court proceeded to analyze whether the proposed class of more than 1,000 property owners from around the bay should be certified.  The plaintiffs argued that there were good grounds to certify the class for at least liability and causation determinations, leaving the calculation of damages to be determined subsequently on an individual basis. 

The court ultimately held that the predominance and superiority requirements were not satisfied because determining liability and causation on the public nuisance theory would require the same kind of individualized inquiry that a damages determination would require:

[T]he proposed class members would have to show that there has been an "unreasonable interference with a right common to the general public" and some "special injury of a direct and substantial character."  A showing of "unreasonable" interference and "special," "direct," and "substantial" injury would require an examination into the individual characteristics of the proposed class members' properties and the extent of contamination.

Id. at *5.  In reaching this conclusion, the court relied heavily on the decision in Church v. General Electric Co., 138 F. Supp. 2d 169 (D. Mass. 2001), in which a court refused to certify a class to determine whether PCB contamination constituted public nuisance and trespass for riparian landowners.

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