Plaintiff's Constitutional Challenge to EMF's Rejected

The U.S. Court of Appeals for the Second Circuit last week upheld the trial court's dismissal of a plaintiff's allegations that several utilities exposed her to high levels of electromagnetic fields in violation of the U.S. Constitution. Barnett v. Carberry,  No.10-1342-cv (2d Cir. 4/20/11).

Here at MassTortDefense we often explore the creative approaches of the plaintiffs' bar.  Here's a real "creative" one.

Plaintiff brought a purported Section 1983 civil rights action against a state licensing agency and  several  utility companies alleging that they exposed her home to unusually high levels of electromagnetic fields ("EMFs") in violation of her property and privacy rights and her rights to due process and equal protection of law.  Barnett claimed that she and her husband suffer from significant health problems allegedly caused by EMF emissions from a power line located 40 feet away from their home. They also allege that their home is now unmarketable.

The district court rejected the federal claims and declined to exercise jurisdiction over any pendent state law claims. On appeal, Barnett emphasized that she was not asking the court to declare that there is a constitutional right to a healthful environment. See MacNamara v. Cnty. Council of Sussex Cnty., 738 F. Supp. 134, 141-43 (D. Del.), aff'd, 922 F.2d 832 (3d Cir. 1990). Rather, she was asking that the court recognize that the asserted constitutional right to be safe and secure in one's home includes the right to be free from an "unreasonable" level of EMFs under the First, Fourth, Fifth, Ninth, and Fourteenth Amendments.

The court of appeals reviewed the relevant case law and, not surprisingly, concluded that no case establishes a constitutional or common-law privacy or property right to be free from an unreasonable level of EMFs.  The related privacy argument asserted, at best, that the government and utilities "failed" to protect her home from EMF emissions -- again never recognized. To the extent that plaintiff  challenged defendants for permitting her home to be "intruded upon" by unreasonably high levels of EMFs, she was forced to concede at argument that no legislature or administrative agency has even determined what levels of EMFs would be "unreasonably high." Indeed, that is a scientific policy question better decided by the legislature than the courts. Cf. City of New Orleans v. Dukes, 427 U.S. 297, 303 (1976) (stating that the judiciary may not "sit as a super-legislature to judge the wisdom or desirability of legislative polic[ies]" in areas that do not implicate fundamental rights or suspect classifications); Cellular Phone Taskforce v. FCC, 205 F.3d 82, 91 (2d Cir. 2000) (characterizing argument that agency should increase safety margin as "a policy question, not a legal one").

Plaintiffs, at least for now, need to stick to conventional tort theories. And defense counsel won't get to practice toxic torts and constitutional law at the same time.


Injunction Issued in Protracted Dryer Litigation

We have posted before about the ongoing Thorogood v. Sears Roebuck & Co. litigation, when the 7th Circuit rejected the proposed class action; when the court held that a "copycat" class action suit could not go forward in federal court in California;  and when the court reaffirmed its decision in an unusual opinion on the petition for rehearing.

The district court had certified a multi-state class of Kenmore-brand clothes dryer purchasers. On appeal, the Seventh Circuit called the case “a notably weak candidate for class treatment.” Not only did common issues of law or fact not predominate over the issues particular to each purchaser of a stainless steel Kenmore dryer, as Rule 23(b)(3) requires, there were, the court said, “no common issues of law or fact.” 547 F.3d at 746-47.

The same plaintiffs' lawyer then brought Murray v. Sears, Roebuck & Co., No. 4:09-cv-5744-CW (N.D. Cal.). Murray was a member of Thorogood’s class, and he brought essentially the identical claim in California. Sears Roebuck sought an injunction halting the new class action in front of Judge Leinenweber, who had presided over and eventually dismissed Thorogood’s original class suit, but he ruled that Sears could obtain adequate relief against being harassed by repetitive litigation by pleading collateral estoppel in Murray’s suit in California. Sears appealed, asking the court to to reverse the district court's denial of Sears’s motion to enjoin the virtually identical class action suit.

Ordinarily the ability to plead res judicata or collateral estoppel gives a litigant adequate protection against being harassed by repetitive litigation by the loser in a previous suit against him. But this case was unusual, said Judge Posner for the panel, both because it involved class action litigation and because of the specific tactics employed by class counsel. Class members are interested in relief for the class but the lawyers are primarily interested in their fees, and the class members’ stakes in the litigation are ordinarily too small to motivate them to supervise the lawyers in an effort to align the lawyers’ incentives with their own. The defendant wants to minimize outflow of expenditures and the class counsel wants to increase inflow of attorneys’ fees. "Both can achieve their goals if they collude to sacrifice the interests of the class.” Leslie, “The Significance of Silence: Collective Action Problems and Class Action Settlements,” 59 Fla. L. Rev. 71, 79-81 (2007). And when the central issue in a case is given class treatment and so will be resolved once and for all, a trial becomes a roll of the dice. Depending on the size of the class, a single throw may determine the outcome of an immense number of separate claims (hundreds of thousands, in the dryer litigation)—there is no averaging of decisions over a number of triers of fact having different abilities, priors, and biases. The risk of error becomes asymmetric when the number of claims aggregated in the class action is so great that an adverse verdict would push the defendant into bankruptcy; in such a case the defendant will be under great pressure to settle even if the merits
of the case are slight.

In the most recent iteration, the district court -- nothing the "tortured path" the case has taken through the judicial system -- has followed the direction of the 7th Circuit. Needless to say,  the parties disagreed as to the terms of the injunction that should be issued.  The primary areas of dispute were whether the injunction should be broad enough to encompass class action claims against co-defendant Electrolux and whether former members of the class should be allowed to pursue class-wide discovery against Sears as a non-party.   Sears argued that its advertising would still be at issue, and that Electrolux was obligated to indemnify Sears for any damages related to the marketing of the dryers.  That is, the only basis for Murray’s claims against Electrolux was the same advertising and marketing by Sears at issue in this case. As such, allowing Murray and his lawyers to continue to burden Sears with class-wide discovery concerning that issue would defeat the purpose of the injunction and circumvent the ruling in Thorogood.

The court concluded that any injunction should not allow class-wide discovery from Sears related to its advertising or representations regarding the composition of the dryer drums. Based on the representations of Murray’s counsel to the California court, it was clear that if his class action suit against Electrolux were allowed to continue, his attorneys plan to seek the same discovery from Sears as they would have if Sears itself were the defendant. No matter what it is called — third–party discovery, non–party discovery — by any name the Seventh Circuit has held that this amounts to irreparable harm.

Regarding whether the focus of the injunction should be on the issues that were litigated and decided in the previous Thorogood rulings, or on the identity of the parties, the court decided that the injunction precedents were couched in terms of the issues decided in the prior case, not the specific parties involved. There was no indication in any of the Seventh Circuit’s rulings that this conclusion depends on the party sued over these representations. Moreover, an injunction is not invalid merely because it may benefit non-parties. See Easyriders Freedom F.I.G.H.T. v. Hannigan, 92 F.3d 1486, 1501–02 (9th Cir. 1996).

Thus, the Court found that Sears would invariably be drawn into the defense of any class-action lawsuit regarding its marketing of the dryers as containing stainless steel drums, regardless of what party is named as a defendant. This would defeat the purpose of the Seventh Circuit’s ruling in Thorogood and prevent Sears from receiving the full measure of relief ordered by the Seventh Circuit. Murray and the other members of the class were free to pursue on a class basis claims against Electrolux not related to Sears’ marketing of the dryers, but they may not use a suit against Electrolux as a back-door method of evading the Seventh Circuit’s ruling in Thorogood.



FDA Holds Meeting on Food Safety Modernization Act Regulations

We have posted before about the Food Safety Modernization Act.  The FDA held a public hearing last week to take input on the implementation of the new food safety law.

FDA was seeking information on preventive controls used by facilities to identify and address hazards associated with specific types of food and specific processes.

After an intro from several FDA officials, the program included several breakout listening sessions. One covered FDA guidance documents for industry on preventive controls. FDA has recognized that it cannot provide a guidance document for each type of food or each type of food facility. Another breakout session focused on the relationship between CGMPs and the preventive controls. A third was on Product Testing and Environmental Monitoring. 

The session concluded with comments from stakeholders, including representatives of consumer groups, the food and feed industries, state regulatory officials, and small business groups.  Among those weighing in were the American Frozen Food Institute and the American Feed Industry Association.  One of the key requests from industry was the need for flexibility and the risks of too-rigid guidance to prevent contamination.  One size does not fit all, and each industry may be in the best position to figure out the specific tools they need.  Indeed, different facilities within an industry may need to employ different systems to prevent food safety hazards. Industry also called for FDA to recognize robust third-party food safety certification programs that are already in place in some food areas. 

Self-appointed consumer groups, on the other hand, called for extensive and detailed regulations of testing, with test protocols to be submitted to FDA in advance and approved.  

Supreme Court Hears Oral Argument in Second Circuit "Global Warming" Case

We have posted before about the climate change or so-called global warming litigation. Last week, the Supreme Court heard oral argument in one of the seminal cases in this area, American Electric Power Co. v. Connecticut, No. 10-174 (U.S. certiorari petition granted 12/6/10).

Readers will recall that the issues include whether a cause of action to cap carbon dioxide emissions can be implied under federal common law; and whether claims seeking to cap carbon dioxide emissions based on a court's weighing of the potential risks of climate change against the utility of defendants' conduct can be adjudicated through judicially discoverable and manageable standards, and whether they could ever be resolved without  the policy determinations clearly of a kind judges should not be making. (Justice Sotomayor, on the panel below, was recused.)

Extended time was given. The Court did not seem persuaded by the arguments of the defendants and the Justice Department that the case should be thrown out on procedural  grounds.  But on the merits, there appeared to be much skepticism about how a district court could ever proceed to a final decision in these kinds of cases.  Counsel for plaintiffs, the six states, had great difficulty  describing how to get there from here, how to have a manageable lawsuit against a small group of greenhouse gas emitters (among the billions of sources), and one focused on alleged  emission-reduction technology that they supposedly should have used. Counsel could muster not a single example of a similar suit that had proceeded to resolution.

Justice Ginsburg observed that the relief sought sounds like "the kind of thing EPA does..... You are setting up a District Judge as a kind of ‘super EPA.’”  And the rest of the Court's traditionally liberal wing seemed to suggest that this was an issue for the EPA.  Justice Kagan suggested that the suit overlapped the typical work of regulatory agencies; Justice Breyer asked an interesting hypothetical about whether the trial court could impose a remedy that was in essence a per-ton tax on carbon emissions, and assuming the finding was that this would be cost-effective, it would lead to substitution, it would "actually bring about a world without global warming." Plaintiffs answered in the negative.  But if there is no "power to enter that order, which could be proved to be extremely effective, and least possible harm to the consumer, why does [the court] have the power to enter the order you want?"

Justice Scalia wondered about the slippery slope, and if this suit could proceed against a handful of utilities, why couldn't the states sue every farmer who owned a cow, or every home that emitted from their home HVAC system?

Justice Alito took another approach to the difficulties of the litigation, noting that if a certain reduction in greenhouse gas emissions is ordered, that will increase the cost of electricity by a certain amount, and that will produce certain consequential effects. It will result in the loss of a certain number of jobs; it will mean that consumers will have less money to spend on other products and services; it will mean that some people will not be able to have air conditioning in the summer. That will have health effects on the elderly and people with breathing issues.  "How is the district judge -- what standard does the district judge have to decide those" questions?

Counsel for defendants correctly noted that the states were in essence asking a judge to perform a legislative and regulatory function, and balance a set of issues that is among the most complex, multifaceted, and consequential of any policy issues now before the country.

Chief Justice Roberts observed that a central issue when dealing with global warming is that there are costs and benefits on both sides, and a policy maker has to determine how much to readjust the world economy to address the global warming.  There are inevitable trade-offs. "I think that's a pretty big burden to impose on a district court judge."

Good news for the defendants: none of the eight justices appeared to voice any significant support for the plaintiffs' position.


Class Rep Who Dismisses Individual Claim Lacks Standing to Appeal Denial of Certification

A proposed class representative who voluntarily dismisses his individual claims lacks standing to appeal the denial of certification of the class claims, according to the Fourth Circuit.  Rhodes v. E.I. du Pont de Nemours & Co., No. 10-1166 (4th Cir.,  4/8/11).

The plaintiffs were residents of the City of Parkersburg in Wood County, West Virginia, and  customers of the Parkersburg City Water Department  which supplied water to homes located in Wood County.  DuPont operated a manufacturing facility in Wood County. For an extended period of time, DuPont’s plant  allegedly discharged perfluorooctanoic acid (PFOA) into the environment
surrounding the plant. Measurable quantities of PFOA were allegedly detected in the water that is pumped by the Water Department into the plaintiffs’ residences.

In 2006, the plaintiffs filed a complaint against DuPont in the Circuit Court of Wood County, West Virginia. Defendant removed. The plaintiffs asserted six common law claims, individually and on behalf of a class of customers of the Water Department, addressing the contamination of their municipal water supply and the alleged resulting presence of PFOA in their blood. The plaintiffs sought damages and injunctive relief to obtain medical monitoring for latent diseases on behalf of a class of Water Department customers allegedly exposed to PFOA beginning in 2005.

After conducting a hearing on the plaintiffs’ motion for class certification under Federal Rule of Civil Procedure 23(b), the district court concluded that the elements of a medical monitoring claim could not be proved on a class-wide basis using the type of evidence presented by the plaintiffs. The district court therefore denied the plaintiffs’ motion for class certification of their stand alone medical monitoring claims. The district court further held that the plaintiffs had not met their burden under Rule 23 for certification of a class to pursue medical monitoring relief based on the plaintiffs’ claims of negligence, gross negligence, battery, trespass, and private nuisance, the common law torts. The district court then denied the plaintiffs’ motion for class certification of the traditional common law tort claims for damages also.

DuPont filed motions seeking summary judgment on all the plaintiffs’ claims. The district court granted in part and denied in part DuPont’s motions. The district court granted DuPont’s
motions with respect to all the plaintiffs’ traditional common law tort claims, Rhodes v. E.I. Du Pont De Nemours and Co., 657 F. Supp. 2d 751, 762-73 (S.D.W. Va. 2009), but denied summary judgment with respect to the plaintiffs’ individual claims of medical monitoring.

Rather than proceed to trial on those remaining individual claims, in order to appeal immediately the adverse summary judgment and certification rulings, the plaintiffs filed a stipulation of voluntary dismissal under Federal Rule of Civil Procedure 41(a)(1) of their individual claims for medical monitoring.

The court of appeals affirmed the summary judgments, but what will be of more interest to our readers is DuPont’s argument that the 4th Circuit lacked appellate jurisdiction to address the merits of plaintiff’s appeal of the denial of class certification of their medical monitoring claims. DuPont asserted that the plaintiffs no longer had standing to advance this argument on appeal because, by voluntarily dismissing their individual claims for medical monitoring, the plaintiffs abandoned their interest in litigating the certification question. As a result, DuPont contended, the plaintiffs had no personal stake in this issue and did not satisfy the requirements for Article
III standing.

In response, the plaintiffs maintained that litigants routinely are permitted to dismiss various claims in order to appeal other claims and, that under federal precedent, this court could review the denial of class certification for a particular claim even though no plaintiff presently was advancing individual claims asserting that cause of action. The plaintiffs further argued that by its plain terms, their stipulated dismissal applied only to their individual medical monitoring claims. Thus, the plaintiffs contended that they did not abandon their stake in the certification question.

As a general matter, circumstances may change while a case is pending, thereby leaving a plaintiff
without the personal stake necessary to maintain Article III standing. For example, claims can expire, or parties can settle or dismiss their claims entirely. In such situations, the district court or appellate court must dismiss the case for lack of subject-matter jurisdiction. On the other hand, generally, a class representative not only has a "personal stake" in the substantive claim he or she asserts, but also a distinct procedural right to represent the interests of similarly situated individuals. This second, representative interest sometimes gives a putative class representative a sufficient "stake" in the class certification question to appeal an adverse certification ruling even after the putative class representative’s claim is mooted by intervening events.

Two conditions must be met, however, to retain Article III jurisdiction, according to the 4th Circuit. The imperatives of a dispute capable of judicial resolution must be sharply present, and there must be self-interested parties vigorously advocating opposing positions.

Other federal circuit courts addressing this issue have reached different conclusions on the question whether a plaintiff may voluntarily settle or dismiss his or her individual claims and still
appeal a certification denial. Some courts have held that standing is maintained when a named plaintiff expressly reserves the right to appeal a certification denial. See Richards v. Delta Air Lines, Inc., 453 F.3d 525 (D.C. Cir. 2006) (express reservation of class claim preserves standing of class
representative to appeal certification denial); Dugas v. Trans Union Corp., 99 F.3d 724 (5th Cir. 1996) (reservation of right sufficient to give putative class representative who settles individual claims standing to appeal denial of class certification). Cf. Narouz v. Charter Commc’ns, LLC, 591 F.3d 1261 (9th Cir. 2010) (putative representative retains standing to appeal unless releases interest in class claims in settlement agreement). Other courts have held that even an express reservation of right is not sufficient to satisfy Article III standing requirements. See Muro v. Target Corp., 580 F.3d 485 (7th Cir. 2009) (recitation in settlement agreement that plaintiff reserves right to appeal denial of class certification not sufficient to create concrete interest in class certification issue); Anderson v. CNH U.S. Pension Plan, 515 F.3d 823 (8th Cir. 2008) (same).

Although several of these cases held that the language of a plaintiff’s settlement agreement is determinative of that plaintiff’s "stake" in an appeal, the 4th Circuit seemed less concerned about the language of the dismissal than the fact of dismissal. It concluded that when a putative
class plaintiff voluntarily dismisses the individual claims underlying a request for class certification, as happened in this case, there is no longer a "self-interested party advocating" for class treatment in the manner necessary to satisfy Article III standing requirements.

The court held that it thus did lack jurisdiction to decide the issue whether the district court abused its discretion in denying the plaintiffs’ request for class certification of their medical monitoring

State Appeals Court Finds Personal Jurisdiction Over Foreign Part Maker

An Illinois appeals court recently held that Illinois courts may exercise jurisdiction over a French manufacturer of helicopter parts. Russell v. SNFA, No. 1-09-3012 (Ill. App. Ct.,  3/31/11).  The court reversed the trial court's decision to dismiss the case for lack of personal jurisdiction.

Readers know that the issues of personal jurisdiction over foreign product manufacturers is currently pending before the U.S. Supreme Court as we have posted before. This case underscores the importance of Supreme Court guidance in this area.

Plaintiff’s brother died during a helicopter crash in Illinois. He was the pilot and sole occupant, and was working for Air Angels, a medical air service that did business primarily in Illinois and, in particular, Cook County.  Defendant SNFA, a French company, made a part for that helicopter, which plaintiff claims was defective and the cause of the crash. Specifically, plaintiff alleged that the crash was caused by  the failure of one of the helicopter’s tail-rotor drive-shaft bearings, which defendant manufactured. Plaintiff alleged that, as a result of this failure, the drive shaft fractured, leaving the tail rotor inoperable; and the helicopter spun out of control.

Defendant moved to dismiss on the ground that Illinois had no jurisdiction over it.  Illinois has a jurisdictional statute, like many states, with a catchall provision which permits Illinois courts to exercise jurisdiction on any other basis now or hereafter permitted by the Illinois Constitution
and the Constitution of the United States. This permits an Illinois court to exercise personal jurisdiction to the extent permitted by the due process clause of the 14th Amendment to the United States Constitution.

General jurisdiction exists when defendant’s general business contacts with the forum state are continuous and systematic. Specific jurisdiction exists when the cause of action arose out of defendant’s contacts with the forum state.  Here, the court of appeals found that the state court had specific jurisdiction over defendant.  One relevant factor is whether the litigation results from alleged injuries that arise out of or relate to the defendant's activities in the state or directed to the state. For a tort action, the state in which the injury occurs is often considered to be the state in which the tort occurred. In the case at bar, the injury occurred in Illinois, and thus Illinois was deemed the state in which this tort occurred.  Numerous prior cases had noted that tortfeasors must expect to be haled into Illinois courts for torts where the injury took place there.

The court of appeals was also persuaded by the fact that the defendant was the same, and indeed many of the facts alleged the same, as in Rockwell International Corp. v. Costruzioni Aeronautiche Giovanni Agusta, S.P.A., 553 F.Supp. 328 (E.D. Pa. 1982).  The federal court there had held that the forum state, which was the site of the crash, could exercise specific personal jurisdiction over defendant SNFA. In both cases defendant had allegedly custom-made bearings for an A-109 helicopter; a subsequent owner replaced the tail-rotor drive-shaft bearings, with ones also manufactured by defendant. In both cases plaintiff alleged that the bearings and the drive shaft
failed, causing the helicopter to crash.

The Illinois court also determined that a relevant sale occurred in the state, despite the fact that the defendant sold the parts outside the U.S. It found that the cause of action could be traced from the sale of the ball bearings by SNFA, through its chain of distribution, to the apparent malfunction that allegedly caused the helicopter to crash. As a result, the court concluded that the “sale, malfunction and injury all occurred within” the forum state.

Defendant argued against minimum contacts claiming that its sales of ball bearings to the helicopter-maker Agusta were confined to Europe and that a court should not blur the distinction between Agusta.  But the court stressed that because the ball bearings were custom-made, SNFA intended its products to be an inseparable part of the marketing plan of Agusta.  That is, the bearing was uniquely designed for incorporation into Agusta’s helicopter, and SNFA had to
distribute its product through Agusta’s distributions system.  Agusta provided defendant with precise specifications, and defendant manufactured the bearings according to those specifications. Defendant acknowledged that it knows that its custom-made tail-rotor bearings are
incorporated by Agusta into helicopters and also sold as individual replacement parts.

SNFA did not deny that it knew that Agusta helicopters were sold throughout the United States, and that Agusta had an American subsidiary for the purpose of American distribution. Given the distribution system, SNFA had ample reason to know, said the court, and expect, that its bearing, as a unique part of a larger product, would be marketed in any or all states, including the forum state. By virtue of having a component specifically designed for the Agusta helicopter, SNFA had a "stake in" and expected to derive definite benefit from sales of the Agusta A-109 (and replacement parts) in the United States.

In essence, Agusta was the marketer and distributor to the consumer of their joint and ultimate product. SNFA has chosen to leave to Agusta the marketing and distribution to the consumer. Agusta was thus called the conduit through which this SNFA product, custom-made for Agusta, reached the ultimate consumers.

Finally, because the court found that SNFA designed and manufactured a component that was incorporated into a product which was intended to be, and was in fact, sold in the United States, it also concluded that where that component allegedly fails and causes injury in the very market in which the product was expected to be sold, it is not unreasonable or unfair to require the defendant to be subject to suit in that forum.

In one respect, this case does not present the most aggressive application of specific jurisdiction, in that the facts suggest something beyond mere stream of commerce jurisdiction, something more than just plain having sold a product that found its way into the forum.  But of great concern for foreign manufacturers would be the analysis of the nationwide distribution scheme, and the notion that by selling a part to a customer that has a national distribution system, a manufacturer thereby exposes itself to tort suits everywhere in the U.S.



Court of Appeals Vacates Class Certification in Toxic Tort Case

The Fifth Circuit has vacated the decision of the trial court in granting class status to a group of plaintiffs alleging that a refinery exposed them to toxic dust. Madison v. Chalmette Refining LLC, No. 10-30368 (5th Cir. 4/4/11).

Back in 2007, a number of schoolchildren, chaperoned by parents and teachers, participated in a historical reenactment at the Chalmette National Battlefield, the site of the January 8, 1815, Battle of New Orleans, the last great battle of the War of 1812 and “the site along the Mississippi River where Andrew Jackson gave the British their comeuppance.” D. BRINKLEY, The Wilderness Warrior: Theodore Roosevelt and the Crusade for America,p. 414 (2009). Adjacent to the battlefield is the Chalmette Refinery, which allegedly released an amount of petroleum coke dust that migrated over the battlefield. Plaintiffs sued on behalf of a class of all persons or entities located at the Chalmette National Battlefield in St. Bernard Parish, Louisiana, in the early afternoon of Friday, January 12, 2007 and who sustained property damage, personal injuries, emotional, mental, or economic damages and/or inconvenience or evacuation as a result of the incident.

The District Court granted the motion to certify, and defendants appealed. The court of appeals reviews the district court's decision to certify a class for an abuse of discretion. See, e.g., McManus v. Fleetwood Enters., Inc., 320 F.3d 545, 548 (5th Cir. 2003). The decision to certify is within the discretion of the trial court, but that discretion must be exercised within the framework of Rule 23. Castano v. Am. Tobacco Co., 84 F.3d 734, 740 (5th Cir. 1996).  The Supreme Court requires district courts to conduct a rigorous analysis of Rule 23 prerequisites.

The crux of this appeal was the legal basis for and sufficiency of evidence supporting the district court’s findings of superiority and predominance under Rule 23(b)(3). Before certifying a class under Rule 23(b)(3), a court must determine that questions of law or fact common to the members of the class predominate over any questions affecting only individual members and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. Determining whether the plaintiffs can clear the predominance hurdle set by Rule 23(b)(3) requires district courts to consider how a trial on the merits would be conducted if a class were certified.

Chalmette Refining cited the advisory committee note to Rule 23(b)(3), which has been quoted numerous times by the Fifth Circuit as highlighting the “relationship between predominance and superiority in mass torts.” See Castano v. American Tobacco Co., 84 F.3d 734, 745 n.19 (5th Cir. 1996). According to the note, a  “mass accident” resulting in injuries to numerous persons is ordinarily not appropriate for a class action because of the likelihood that significant questions, not only of damages but of liability and defenses to liability, would be present, affecting the individuals in different ways. In these circumstances an action conducted nominally as a class action would degenerate in practice into multiple lawsuits separately tried.

Here, the district court abused its discretion by failing to afford its predominance determination the “rigorous analysis” that Rule 23 requires. In particular, the district court did not meaningfully consider how plaintiffs’ claims would be tried.  Plaintiffs cited, and the trial court relied on, two cases that are among the very few certifying a tort injury class action. In Watson v. Shell Oil, the court certified a class of over 18,000 plaintiffs seeking damages stemming from an explosion at a Shell plant. 979 F.2d 1014, 1016 (5th Cir. 1992). Notably the court of appeals now clarified that "whether Watson has survived later developments in class action law–embodied in Amchem and its progeny–is an open question."  But even in Watson, the district court had a detailed four-phase plan for trial. Similarly, in Turner v. Murphy Oil USA, Inc., the district court granted class certification to a class of plaintiffs who suffered damages resulting from a post-Hurricane Katrina oil storage tank spill. 234 F.R.D. 597, 601 (E.D. La. 2006). Critical to the court’s predominance inquiry was the fact that plaintiffs had submitted a detailed proposed trial plan to the court, calling for bifurcation of certain issues.

In contrast, here there was no analysis or discussion regarding how the court would administer the trial.  Robinson v. Tex. Auto. Dealers Ass’n, 387 F.3d 416, 425–26 (5th Cir. 2004). The court failed to identify the substantive issues that would control the outcome, assess which issues will predominate, and then determine whether the issues are common to the class. Absent this analysis, it was impossible for the court to know whether the common issues would be a significant portion of the individual trials, much less whether the common issues predominate.  Instead, the trial court appears to have "adopted a figure-it-out-as-we-go-along approach." 

Even among the named class representatives, significant disparities existed, in terms of exposure, location, and whether mitigative steps were taken. The primary issues left to be resolved would turn on location, exposure, dose, susceptibility to illness, nature of symptoms, type and cost of medical treatment, and subsequent impact of illnesses on individuals.



Marital Privilege Over Emails Rejected in Oil Spill Litigation

The massive litigation over the Gulf oil spill has spawned a wide range of significant legal issues.  Here's an interesting little one. The magistrate judge in the MDL has held that a BP drilling engineer cannot assert marital privilege regarding e-mails to his spouse sought by the plaintiffs. In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico on April 20, 2010, MDL 2179 (E.D. La., 3/28/11).

Mr. Morel was employed by BP as a drilling engineer on the Macondo Well.  Plaintiffs and several defendants wanted to depose him.  The witness asserted the marital privilege as to certain email communications which were produced by BP to the Plaintiff Steering Committee. He contended that 93 documents containing email communications between himself and his wife should be returned to him or destroyed. His wife was a production engineer for BP, with no duties relating to the well. 

All of the email communications at issue were made through their BP email accounts. But the witness urged that: (1) BP permitted the personal use of company email; (2) it did not indiscriminately or randomly monitor its employees’ emails; (3) no third party other than BP had a right to access Mr. Morel’s email account.  The court framed the issue as whether BP’s notification
statements and email policies were sufficient to defeat Mr. Morel’s assertion of the marital privilege over the emails.

BP computer screens included the statement that “[w]ithin the bounds of law, electronic transmissions through internal and external networks may be monitored to ensure compliance with internal policies and legitimate business purposes."  BP’s Code of Conduct Policy provided that: Personal data, information or electronic communications created or stored on company computers or other electronic media such as hand-held devices are not private.

Mr. Morel, however, argued that the determination of privilege should not be made on the basis of the written BP policies but on how those policies were implemented.

There are a number of cases finding that when an employer has a rule prohibiting personal computer use, an employee cannot reasonably expect privacy in their prohibited communications.   Miller v. Blattner, 676 F.Supp.2d 485 (E.D.La. 2009); Thygeson v. U.S. Bankcorp, 2004 WL 2066764 (D. Or.); Kelleher v. City of Reading, 2002 WL 1067442, *8 (E.D. Pa.).

BP had no such prohibition, but BP notified its employees that electronic communications could
be monitored and accessed by BP. There are a few cases indicating that policies short of a prohibition of personal use can defeat an expectation of privacy. Muick v. Glenayre Electronics, 280 F.3d 741 (7th Cir. 2002); United States v. Etkin, 2008 WL 482281 (S.D.N.Y); Sims v. Lakeside School, 2007 WL 2745367, *1 (W.D. Wash.).

Based on these cases, this court found that it was not objectively reasonable for an employee to have an expectation of privacy where the employers’ policies clearly demonstrate that the employee’s electronic communications may be monitored and accessed by the employer; and thus they were subject to production by a subpoena.

Plaintiffs Bar Looking to Attack Exploration of Shale Gas

Many of our readers may have seen the recent cover story in Time noting how natural gas from shale rock promises to provide cleaner, abundant energy for the U.S.   While the fuels of the future were often said to be solar, wind, or nuclear (before Japan perhaps?), new drilling methods allow companies to tap into huge quantities of gas from shale rock. New estimates show that we have enough of this natural gas to last 100 years at current consumption rates.

The second biggest natural gas field in the world -- the Marcellus -- runs through your humble blogger's home state of Pennsylvania. The energy, jobs, taxes, and independence that tapping into this domestic resource will bring has spurred much interest and anticipation. The method to extract the gas from the rock is called hydraulic fracturing, which like any technology, carries potential risks.

As detailed in the Legal Intelligencer, however, the potential drilling into the Marcellus Shale has caught the attention of the plaintiffs' bar, including personal injury and environmental class action lawyers.  Plaintiffs lawyers are openly speculating about everything from gas leaks and fires,  to environmental groundwater impacts,  to the problems of large tanker trucks on small rural roadways.

Some plaintiff firms are reportedly trolling for clients, among local residents and workers on Marcellus Shale drill sites as well.

Out west, there has already been litigation filed. See Strudley v. Antero Resources Corp., No. 2011CV2218 (Colo. Dist. Ct., Denver Cty., 3/24/11).  Plaintiffs sued the gas exploration company and drilling equipment contractor, alleging that the hyrdrofracking contaminated their well water. Of more interest to our readers, perhaps, is the count for medical monitoring. Plaintiffs lawyers say they have other case to file, and are quoted as planning other medical monitoring class actions.

Medical monitoring is recognized under Pennsylvania law, and a handful of other states, and a plaintiff must prove:

1. exposure greater than normal background levels;

2. to a proven hazardous substance;

3. caused by the defendant's negligence;

4. as a proximate result of the exposure, plaintiff has a significantly increased risk of contracting a serious latent disease;

5. a monitoring procedure exists that makes the early detection of the disease possible;

6. the prescribed monitoring regime is different from that normally recommended in the absence of the exposure; and

7. the prescribed monitoring regime is reasonably necessary according to contemporary scientific principles.

Redland Soccer Club v. Dep't of the Army, 548 Pa. 178, 696 A.2d 137, 145-46 (Pa.1997).

A number of these elements implicate individual issues that should defeat class certification under the predominance or cohesiveness analyses of Rule 23.  Nevertheless, it should come as no surprise to industry that this vital economic activity comes with litigation risks as well.


Seminar Worth Checking Out

A head's up for our readers about an upcoming seminar worth checking out. DRI’s Drug and Medical Device Committee will hold its 27th annual Seminar on May 5-6, 2011 at the Sheraton Hotel and Towers in Chicago, Illinois. 


The Seminar offers an outstanding program for practitioners and in-house counsel who practice pharmaceutical and medical device law.  The Seminar features nationally recognized attorneys, both in-house and outside counsel, who will speak on a variety of cutting edge topics relevant to the life sciences industry.  The program offers a variety of presentations including moderated panel discussions, individual presentations from leading practitioners and practical demonstrations of trial skills.  There is also a Young Lawyers Blockbuster session. 


In addition to the outstanding educational opportunities, the Seminar provides great networking opportunities to connect or reconnect with counsel and clients from around the country. Attendees may earn up to 12 hours of CLE, including 1 hour of ethics credit.


More information available here. 


Federal Court Dismisses Soda Misrepresentation Claim

A New Jersey federal recently dismissed a putative class action accusing The Coca-Cola Co. of misleading consumers about the health value of the carbonated beverage Diet Coke Plus.  Mason et al. v. The Coca-Cola Co., No. 09-cv-00220 (D.N.J. 3/31/11).

This is another in the series of cases we have warned readers about: plaintiffs are not injured, are not at risk of injury, have gotten the benefit of their bargain, but claim they were somehow duped by marketing. Here, plaintiffs alleged that they “were persuaded to purchase the product because the term ‘Plus’ and the language ‘Diet Coke with Vitamins and Minerals’ suggested to consumers that the product was healthy and contained nutritional value,” when it allegedly did not.

Defendants moved to dismiss under the Twombly/Iqbal doctrine.  Of course, claims alleging fraud or mistake must also meet the heightened pleading requirements of Fed. R. Civ. P. 9(b), which requires such claims to be pled with “particularity.”

To state a claim under the New Jersey Consumer Fraud Act., a plaintiff must allege: “(1) unlawful conduct by the defendants; (2) an ascertainable loss on the part of the plaintiff; and (3) a causal relationship between the defendants’ unlawful conduct and the plaintiff’s ascertainable loss.” Frederico v. Home Depot, 507 F.3d 188, 202 (3d Cir. 2007). Plaintiffs claimed that defendant committed affirmative acts of fraud and deception, and that they were persuaded to purchase the product because the term ‘Plus’ and the language ‘Diet Coke with Vitamins and Minerals’ somehow suggested to consumers that the product was healthy and contained extra nutritional value.

However, the FDA's warning letter about the product attached by plaintiffs to their own complaint shows that it is not false that Diet Coke Plus contains vitamins and minerals.  Plaintiffs failed to allege with particularity what further expectations beyond these ingredients they had for the product or how it fell short of those expectations. Plaintiffs simply made a broad assumption that defendant somehow intended for Diet Coke Plus’s vitamin and mineral content to deceive plaintiffs into thinking that the beverage was really “healthy.”  Without more specificity as to how defendant made false or deceptive statements to plaintiffs regarding the healthiness or nutritional value of the soda, the court found that plaintiffs failed to plead the “affirmative act” element with sufficient particularity to state a viable NJCFA claim.

Plaintiffs also failed to plead an ascertainable loss. When plaintiffs purchased Diet Coke Plus, they received a beverage that contained the exact ingredients listed on its label. Plaintiffs could not explain how they experienced any out-of-pocket loss because of their purchases, or that the soda they bought was worth an amount of money less than the soda they consumed. Mere subjective  dissatisfaction with a product is not a quantifiable loss that can be remedied under the NJCFA.  The same defects doomed the common law misrepresentation claims.

Although the FDA had issued the warning letter (on a somewhat arcane and technical issue), the court noted that not every regulatory violation amounts to an act of consumer fraud. The court also noted that it is simply not plausible that consumers would be aware of FDA regulations regarding “nutrient content” and restrictions on the enhancement of snack foods. The complaint actually did not allege that consumers bought the product because they knew of and attributed something meaningful to the regulatory term “Plus” and therefore relied on it. Rather, plaintiffs alleged merely that they subjectively thought they were buying a “healthy” product that happened to also apparently run afoul of a technical FDA regulation.

CPSC General Counsel Speaks at DRI

I am attending the DRI Product Liability Conference in New Orleans this week (as I know a number of readers are). Your humble blogger serves as Chair of the Mass Torts and Class Action sub-committee.

At the keynote address, Cheryl Falvey, Esq., General Counsel of the Consumer Product Safety Commission, spoke about an issue we have posted on before, the new incident report database.
With the usual disclaimer that she was not speaking for the CPSC officially, she shared a number of personal insights.

The new database went on line last month, and the first consumer reports were posted last week. It can be viewed through the Commission site with a link to There is a search function for products or manufacturers names, and it lists any recalls and reports, which can be filtered by date.

She indicated that, like Congress and the bar, the Commission is extremely divided on the new database. She stressed that, per the statutory requirement, there is a disclaimer on the site that: CPSC does not guarantee the accuracy, completeness, or adequacy of the contents of the Publicly Available Consumer Product Safety Information Database on, particularly with respect to information submitted by people outside of CPSC. She admitted, however, that some lawyers may well seek to use the database to argue manufacturers were on notice of something regarding the product.

She noted that anonymous reports to the CPSC are not automatically published, but of course as to the public, every report on the website appears anonymous.

The CPSC believes it is mandated to publish reports of risks of harm as well as actual harm.

The Commission, she says, investigates only about 10% of the reports received; they do not have the budget and resources to investigate every report, let alone investigate reports before they are published. The CPSC is thus "not adjudicating" the product complaints, just posting them.