Louisiana Law Blog

By Bradley C. Myers, Charles S. McCowan, Jr., and M. Dwayne Johnson

The Louisiana Supreme Court recently issued a major decision in favor of industry by reversing the rulings of a trial court and an appellate court that found plaintiffs in a toxic tort case were entitled to an award of punitive damages based on the application of another state’s law.

Kean Miller submitted an amicus brief in Craig Steve Arabie v. CITGO Petroleum Corporation, 2010-C-2608 (La. 3/13/12) on behalf of the Louisiana Chemical Association, the American Chemistry Council, and the Chamber of Commerce of the United States of America in support of CITGO’s successful appeal of the punitive damages award.

On March 13, 2012, the Louisiana Supreme Court in a 5-2 decision, held that under Louisiana’s choice of law principles, the punitive damages laws of Texas could not be applied to a claim for personal injuries that occurred in Louisiana, even though the defendant was a Delaware corporation with its corporate headquarters in Texas.

In overturning the lower courts’ decisions awarding punitive damages (while upholding the compensatory damages awards), the Court provided some much-needed guidance about how the Louisiana Civil Code articles governing choice of law should be interpreted when punitive damages are sought under another state’s law against a corporate defendant domiciled outside Louisiana but with a significant Louisiana presence. Following an accidental release from a wastewater treatment system, fourteen plaintiffs filed suit alleging that they were injured as a result of exposure to fumes from the release. The plaintiffs sought punitive damages under Texas law. (In 1996, Louisiana repealed a law that allowed punitive damages for injuries caused by the wanton or reckless disregard of public safety in the storage, handling, or transportation of hazardous or toxic) Plaintiffs alleged that decisions made at the corporate level in Texas justified the imposition of Texas law. The trial and appellate courts agreed with plaintiffs’ position on punitive damages.

The Supreme Court, however, disagreed. Under the facts presented, the Court held that under the Louisiana Civil Code articles on Choice of Laws, the defendant corporation had to be treated as a Louisiana domiciliary; and, as such, Louisiana law did not allow an award of punitive damages for injuries sustained in Louisiana by Louisiana residents allegedly resulting from an accident that also occurred in Louisiana. The Court analyzed a number of factors in reaching its conclusion, including that all plaintiffs were located in Louisiana, the defendant had a major presence in Louisiana, the events took place in Louisiana and the injuries occurred in Louisiana. In looking at these factors, the Court noted that unless management or corporate level decisions outweighed the allegedly tortious activity that occurred within Louisiana, those corporate-level decisions would not justify the application of another state’s laws. . Therefore, the Court overturned the punitive damages award.

Craig Steve Arabie v. CITGO Petroleum Corporation

Read the amicus brief.
 

By Barrye P. Miyagi

The Medicare laws have undergone significant changes. With the relatively new reporting regulations and the focus on compliance, litigators must implement new procedures in their practice. Many companies are establishing guidelines to obtain information needed to comply with the Medicare Secondary Payer Act (“MSP”) and the Medicare, Medicaid and SCHIP Extension Act of 2007 (“MMSEA”).

The Centers for Medicare & Medicaid Services (“CMS”) is responsible for oversight of the Medicare program. While the CMS has published information to guide the parties, there is room for interpretation of many of the guidelines and, in some instances, there are no guidelines to assist the parties.

This white paper is designed to provide parties involved in toxic tort liability suits with knowledge of the key provisions of the MSP and the MMSEA. The white paper focuses on the practical aspects of obtaining information needed for compliance, common misconceptions and risk avoidance. The document also discusses the significance of cases involving incidents that pre-date the December 5, 1980 MSP, practical aspects of determining when the December 5, 1980 policy may be applied, and recent guidance from the CMS on that issue.

Download the white paper.

Kean Miller LLP is pleased to announce the release of the ninth edition of the Practical Digest of Louisiana Class Action Decisions.  The digest is produced by Charles S. McCowan, Jr., Bradley C. Myers, Gerald E. Meunier (Gainsburgh, Benjamin, David, Meunier & Warshauer), and Thomas F. Daley (District Attorney of the 40th Judicial District).  The fifty page book provides a digest of Louisiana class action decisions, classification by subject matter, and classification by certification disposition.

Click here to download  a copy of the digest.  For a hard copy, please email client_services@keanmiller.com

* The digest is a compilation of certain class action decisions and it should not be construed as a complete reflection of the holdings of the cases.

By Katie D. Bell

In The Pension Committee of the University of Montreal Pension Plan, et al. v. Banc of America Securities LLC, et al., 685 F.Supp.2d 456 (S.D.N.Y. 2010), Judge Scheindlin—author of the renowned Zubulake decisions—further develops the boundaries of discovery duties in a lengthy opinion. Although the opinion does not require parties to meet a standard of perfection during discovery, the opinion serves as an important guide that offers concrete rules and potentially burdensome standards that attorneys should heed to avoid sanction.

Writing systematically, Scheindlin initially frames the fundamental concepts underlying the nature and scope of a party’s duty to preserve, collect, review, and produce requested records during discovery:

The first [critical issue] is plaintiffs’ level of culpability-that is, was their conduct of discovery acceptable or was it negligent, grossly negligent, or willful. The second is the interplay between the duty to preserve evidence and the spoliation of evidence. The third is which party should bear the burden of proving that evidence has been lost or destroyed and the consequences resulting from that loss. And the fourth is the appropriate remedy for the harm caused by the spoliation. (1)

By Katie D. Bell

Electronic Discovery, or “E-Discovery”, is not considered the “novel issue” it once was. However, E-Discovery still presents problems that litigants and courts struggle with. Below is a summary of recent Louisiana Federal Court opinions dealing with the issues surrounding E-Discovery.

In Frees, Inc. v. McMillian, 2007 WL 184889 (W.D. La. Jan. 22, 2007), the Western District of Louisiana granted the plaintiff’s motion to compel. In an unfair competition and trade secret theft action, the plaintiff claimed that the defendant, a former employee, had stolen various data files. Plaintiff had unsuccessfully requested production of defendant’s laptop and desktop. The Court granted the motion to compel the defendant to produce these two items because they were the most likely places that the data files would be located. The Court did institute protective measures so as to prevent the disclosure of any irrelevant or personal information.
 

By Bradley C. Myers
 

The United States Supreme Court recently resolved conflicts among the Circuit Courts about the citizenship of a corporation for determining diversity of citizenship jurisdiction (1). This will allow corporations to analyze with more predictable results whether to remove a case to federal court. In Hertz Corp. v. Friend, et al, No. 08-1107 (February 23, 2010) (a unanimous decision, which is unusual in and of itself), the Court decided that when determining a corporation’s citizenship for diversity of citizenship jurisdiction, the “principal place of business” of the corporation is “the place where the corporation’s high level officers direct, control, and coordinate the corporation’s activities”—something that courts have referred to as the “nerve center” of the corporation.

Throughout 2004–2007 a housing boom along with a series of hurricanes in the Gulf of Mexico combined to create a shortage of drywall in the United States.  Needing drywall to build the homes that were much in demand, suppliers turned abroad. Chinese manufacturers stepped in, providing cheap and readily available material.  This influx of Chinese drywall was concentrated in Florida, Louisiana, and Mississippi; the states most affected by Hurricanes Wilma, Katrina, and Rita.  Since 2006, it has been estimated by some sources that more than 550 million pounds of drywall have been imported from China.  There are reports that some 100,000 homes could possibly be affected nationwide. 

By G. Trippe Hawthorne

The Louisiana Legislature has adopted House Concurrent Resolution No. 185, authored by Representative Tim Burns.  The resolution urges and requests that the Department of Health and Hospitals and the Deptartment of Insurance, in consultation with the Louisiana State Licensing Board for Contractors, investigate the health risks associated with living in homes that contain drywall imported from China, study the potential homeowners insurance coverage issues, including triggers, endorsements, and exclusions to policies that are related to drywall imported from China, and determine whether such material should be identified as a substandard, unsafe building material.  The resolution goes on to request a report of the findings and recommendations of this study to the legislature prior to the convening of the 2010 regular session.

A copy of the enrolled version of the resolution can be seen here: Download file

by Erich P. Rapp

by Erich P. Rapp

During a presentation at the Defense Research Institute’s Toxic Torts and Environmental Law Seminar in New Orleans on Friday March 9, 2007, Dr. Pamela Williams of ChemRisk, Inc. indicated that she was preparing to publish a study on the potential for exposure to benzene from products containing trace (less than 0.1%) levels of benzene. Her study will likely conclude that measured airborne concentrations of benzene during the handling or use of petroleum-derived products in the United States have typically not exceeded workplace standards since at least the early 1980's. The Williams’ study will also likely conclude that indoor air modeling shows that workplace exposures are likely to be minimal during the application of products containing trace levels of benzene. Finally, the Williams study will likely conclude that petroleum-derived products containing trace levels of benzene are not expected to produce 8-hour TWA airborne concentrations that exceed current regulatory standards under typical product use scenarios.

Kean Miller is pleased to announce that 12 lawyers, formerly in the Admiralty & Maritime, Construction, and Energy practice areas with Lemle & Kelleher, LLP, have joined the firm in the New Orleans office.

"We are very excited to welcome these distinguished attorneys to our law firm. They are an outstanding resource for our clients. Our offices are located in Louisiana's major port cities --- New Orleans, Baton Rouge and Lake Charles -- and this esteemed group brings over 150 years of combined experience in maritime issues, admiralty law, marine insurance, oil & gas, drilling and exploration, pipelines, construction, and energy law to our clients." said Gary A. Bezet, managing partner of the 121-lawyer firm.

By Esteban Herrera

Reproduced with permission from Toxics Law Reporter, Vol. 20, No. 47, pp. 1067-1069 (Dec 8, 2005). Copyright 2005 by The Bureau of National Affairs, Inc. (800-372-1033). http://www.bna.com

In the wake of two hurricanes, many Louisiana industries, businesses, and citizens are left with a monumental task of cleaning up the damages caused by the storms. Many Louisianians also face the somewhat unknown future of what potential liability lies ahead under various environmental statutes and programs. After the storms, the State of Louisiana and the federal government temporarily eased many requirements under various environmental regulatory programs so that immediate actions could be taken to preserve property and protect lives. Significant questions remain, however, as to how these agencies are going to use their enforcement discretion in the future with respect to events that occurred during and after the storms.

By Mark D. Mese

Reproduced with permission from Class Action Action Litigation Report, Vol. 6, No. 21, pp. 795-797 (Nov 11, 2005). Copyright 2005 by The Bureau of National Affairs, Inc. (800-372-1033). http://www.bna.com

The damages caused by Hurricane Katrina in Louisiana, Mississippi, and Alabama constitute the largest natural disaster in U.S. history. Hurricane Katrina's impact on insurers and their policyholders have already set in motion what will probably be one of the largest legal and public policy storms to hit the United States in modern times. Nowhere will the storm be more evident than in disputes involving wind and water damage coverage.

The eye of the coverage storm is already manifesting itself in coastal areas of Louisiana, Mississippi, and Alabama.

By Glenn M. Farnet

Reproduced with permission from Class Action Action Litigation Report, Vol. 6, No. 21, pp. 793-795 (Nov 11, 2005). Copyright 2005 by The Bureau of National Affairs, Inc. (800-372-1033). http://www.bna.com

Katrina has already spawned a hurricane of lawsuits. These suits include: suits by individuals who claim they were injured by hazardous substances that leaked from storage facilities, refineries, or pipeline facilities; suits by individuals who claim that oilfield production and pipeline activities caused wetland damage that exacerbated the effects of hurricane Katrina; and suits by individuals who claim faulty levees caused the widespread flooding that followed in the days after Katrina made landfall. All of these suits have a common thread: each will require the courts to determine whether the damages sued upon resulted from nature's fury or human blunder.

Louisiana, like many other states, recognizes the general principle that an "act of God" can be a complete defense to liability for negligence and strict liability claims. Louisiana courts have generally used a consistent definition of the term "act of God," but the application of that definition in the context of a specific event has not always been consistent or clear, particularly when the issue of contributing human fault is at play.

By Glenn M. Farnet

The past twenty years has seen a dramatic increase in the volume of mass tort and other forms of complex litigation. As the volume of litigation has grown, so too have the burdens on the judiciary and the litigants. To address this growing problem, it is imperative that modern adjudicatory tools be adopted to achieve the goal of securing the just, speedy, and inexpensive determination of every action. One such case management tool that has developed in the context of mass tort litigation - but that can be equally effective in other types of litigation - is the Lone Pine Order.

As a service to the community and its clients, Kean Miller will present a Post-Katrina Energy Industry Forum on Thursday, October 13th. In addition, the firm will host its Louisiana Environmental Forum on Friday, October 14th. These two important industry events are part of a week-long breakfast briefing series designed to provide innovation, insight and ideas for business and industry in Louisiana. These breakfast briefing events will be held at Drusilla Place, 3482 Drusilla Lane (Jefferson Highway at I-12 in Baton Rouge).

Per its website at http://www.laed.uscourts.gov, the United States District Court for the Eastern District of Louisiana has closed until further notice, and has suspended "all deadlines and delays in matters pending before this court...until ordered otherwise."

By Lolly White

In-house counsel who are employed in Louisiana but are not licensed to practice law here have until July 1, 2005 to file an application for limited licensure to practice under the Louisiana Supreme Court's new In-House Counsel Rule.

By Charles S. McCowan, Jr.

The Louisiana Supreme Court recently adopted a new Rule XII Section 13, governing the participation by out of state attorneys in Louisiana litigation. Often, guest attorneys desire to participate in Louisiana cases on a pro hac vice basis. The new rule governs such participation. Read more.