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By Greg Anding

For years, plaintiffs in asbestos litigation have been filing suit in the plaintiff-friendly jurisdictions of St. Louis, Missouri and Madison County, Illinois.  Some estimate that more than half of all mesothelioma claims filed in the United States are filed in Illinois and Missouri.  Many of those claims arise out of alleged exposures completely outside of those two states: some sources cite as many as 72%.  Under guidance from the United States Supreme Court’s ruling in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), Missouri appears to be bringing that trend to an end, which will likely mean an increase in filings in states such as Louisiana where the alleged exposures actually occurred.  A similar issue is currently pending in Illinois, and a similar ruling would likely mean more filings in Louisiana as well.

On February 28, 2017, the Missouri Supreme Court, in State ex rel. Norfolk So. Ry. Co. v. Hon. Colleen Dolan, No. SC95514 (2/28/2017), applying the United States Supreme Court’s landmark ruling in Daimler, dismissed plaintiff’s suit for lack of personal jurisdiction.  Russel Parker, plaintiff, was an Indiana resident who was allegedly injured in Indiana while employed by Norfolk Southern Railway Company (“Norfolk”), a Virginia corporation with its principal place of business in Virginia.  The court found that although Norfolk owned and operated railroad tracks in Missouri, Mr. Parker’s suit did not arise out of or relate to Norfolk’s activities in Missouri, and therefore, Missouri had no specific jurisdiction.  More significant was the court’s finding of no general jurisdiction despite Norfolk’s “substantial and continuous business in Missouri” as demonstrated by its ownership of 400 miles of railroad tracks in Missouri, 590 employees in the state and generation of approximately $232 million in annual revenue from its Missouri operations.  Finding that Norfolk also conducted “substantial and continuous business in at least 21 other states,” and its Missouri business amounted to only 2 percent of its total business, the court held this was insufficient to establish general jurisdiction over Norfolk.  The court also noted that Norfolk did not consent to suit over activities unrelated to Missouri simply by complying with Missouri’s foreign corporation registration statute.

For more information, please contact any member of our Louisiana Asbestos Defense and Occupational Exposure team.

Norfolk Opinion.

 

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By Brittany Buckley Salup

Chief Judge Brian Jackson issued an “Omnibus Order Suspending All Deadlines” for cases pending or to be filed in the U.S. District Court for the Middle District of Louisiana.  The Order explains that the court has been inaccessible—a key term in the Federal Rules of Civil and Appellate Procedure—since August 12, 2016 due to historic flooding in the region.  Until further notice from the Middle District, all deadlines and delays in cases pending or to be filed in the Middle District are suspended.  This suspension expressly applies to prescriptive and peremptive periods.  In addition, all pending criminal cases in the Middle District are temporarily excluded from the time requirements of the Speedy Trial Act.

The Middle District’s Order follows similar Executive Orders from Governor Edwards, which suspended deadlines in Louisiana state courts due to flooding.  More information about the Governor’s Orders is available here.

A copy of the Middle District’s Order (M.D. La. General Order 2016-10) is available here.

 

 

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By Claire Juneau

On August 17, 2016, Governor Edwards amended Executive Order JBE 2016-57 which had suspended the running of prescription, peremption, and all legal delays from August 12, 2016 until September 9, 2016. The amendment to Executive Order JBE 2016-57 modifies the suspension of deadlines as follows:

  • Liberative prescription and peremptive periods continue to be suspended throughout Louisiana until Friday, September 9, 2016.
  • Deadlines in legal proceedings currently pending in state courts, administrative agencies, and boards in Acadia, Ascension, Assumption, Avoyelles, Cameron, East Baton Rouge, East Feliciana, Evangeline, Iberia, Iberville, Jefferson Davis, Lafayette, Livingston, Pointe Coupee, St. Charles, St. Helena, St. James, St. John the Baptist, St. Martin, St. Tammany, Tangipahoa, Vermilion, Washington, West Baton Rouge, and West Feliciana, Parishes, continue to be suspended until Friday September 9, 2016. This suspension includes all deadlines set forth in the Louisiana Civil Code, the Louisiana Code of Civil Procedure, Title 9 (Civil Code Ancillaries) Title 13 (Courts and Judicial Procedure), Chapter 11 of Title 18 (Election Campaign Financing); Chapter 10 of Title 23 (Worker’s Compensation); Chapter 5, Part XXI-A of Title 40 (Malpractice Liability for State Services); Chapter 5, Part XXIII, of Title 40 (Medical Malpractice), and Title 49, Chapter 13 (Administrative Procedure) of the Louisiana Revised Statutes. This is a modification from the original Exeuctive Order JBE 2016-57 which suspended deadlines statewide.
  • Except for the suspension of prescriptive and peremptive periods and the suspension of deadlines in the parishes listed above, the suspension provided for in original Executive Order JBE 2016-53 shall end Friday, August 19, 2016. If a party can show an inability to meet the deadlines caused the flooding, the court, administrative agency, or board shall suspend deadlines specific to that matter until September 9, 2016.

A copy of the amendment can be found here: JBE-16-57-Amended-Emergency-Suspension-of-Deadlines-in-Legal-Proceedings

A copy of the original executive order can be found here.

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By Tyler Moore Kostal

As previously reported, the Louisiana Supreme Court heard oral argument in Oleszkowicz v. Exxon Mobil Oil Corporation, et al. and Chauvin v. Exxon Mobil Corporation, et al., regarding the dispute as to whether claims for punitive damages are barred by res judicata. The court recently issued opinions in these cases.

To recap, a jury awarded the plaintiff in the initial Oleszkowicz case compensatory damages for the increased risk of cancer but specifically denied punitive damages. The denial was based on the jury’s express finding that that the defendant had not engaged in wanton or reckless conduct. Soon after that suit, plaintiff actually developed cancer and filed suit again, claiming that his cancer was caused by the same exposure and conduct as the first suit. He sought compensatory damages and renewed his claim for punitive damages. Contrary to the verdict in the first suit, the jury awarded plaintiff $10 million in punitive damages. The defendant appealed, and the court of appeal reduced the punitive damages award but rejected defendant’s argument of res judicata. Instead, the court of appeal found that an exception to res judicata applied, as “the complexity of and convoluted circumstances” of the case constituted “exceptional circumstances.” However, the Louisiana Supreme Court concluded that res judicata bars any re-litigation of the punitive damages claim and that no “exceptional circumstances” exist to justify an exception to res judicata. The court found it undeniable that the plaintiff’s right to bring a future cancer claim in his initial case did not change the fact that he fully prosecuted his punitive damages claim, and the jury, in deciding whether to award such damages, found that the defendant had not engaged in wanton or reckless conduct. While the court noted that the facts are unusual, the case does not involve a complex procedural situation or an unanticipated quirk in the system to which an exception to the general rules of res judicata applies. Because it found that the plaintiff’s punitive damages claim must be dismissed, the court reversed the judgment of the court of appeal.

In Chauvin, the defendant settled the plaintiff’s fear/increased risk claim and received a release from all future claims, except for future cancers. Plaintiff later developed cancer and filed another lawsuit, including a claim for punitive damages. The defendant sought dismissal of all claims barred by plaintiff’s prior settlement. The trial court agreed and granted defendant’s exception of res judicata as to all claims, including punitive damages, other than damages for future cancer. Plaintiff appealed, and the court of appeal reversed the trial court’s judgment as it pertained to punitive damages, finding an exception to res judicata. The Louisiana Supreme Court held that punitive damages relate to conduct and are separate and distinct from compensatory damages related to a specific injury. Because the plaintiff released all punitive damages arising out of the defendant’s alleged misconduct resulting in his exposure to NORM, res judicata bars his subsequent claim for punitive damages and no exception to res judicata applies. The court reversed the decision of the court of appeal and reinstated the trial court’s judgment. The plaintiff sought rehearing from the Louisiana Supreme Court. The court denied rehearing on February 6, 2015.

In sum, the Louisiana Supreme Court held that a jury’s prior finding of no punitive damages, or a prior release of punitive damages, prevents the same plaintiff from later pursuing punitive damages against the same defendant in a subsequent case for the same exposure.

 

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By Tyler Moore Kostal

The Louisiana Supreme Court recently heard oral argument in two cases, Oleszkowicz v. Exxon Mobil Oil Corporation, et al. and Chauvin v. Exxon Mobil Corporation, et al., both involving a plaintiff’s damages for potential exposure to naturally occurring radioactive material (NORM). This is the second lawsuit for both plaintiffs against the same defendant, for the same exposure to NORM as in the first suit. Both plaintiffs initially sued (in other matters) for fear/increased risk of cancer and then later sued for developing cancer due to the same potential NORM exposure. The fact that the plaintiffs can bring separate lawsuits for the same exposure is not in dispute. What is in dispute is whether the plaintiffs are entitled to punitive damages for each claim.

In the initial Oleszkowicz case, a jury awarded plaintiff compensatory damages for the increased risk of cancer but specifically denied punitive damages. The denial was based on the jury’s express finding that that the defendant had not engaged in wanton or reckless conduct. Soon after that suit, plaintiff actually developed cancer and filed suit again, claiming that his cancer was caused by the same exposure and conduct as the first suit. He sought compensatory damages and renewed his claim for punitive damages. Contrary to the verdict in the first suit, the jury awarded plaintiff $10 million in punitive damages. The defendant appealed. The court of appeal reduced the punitive damages award but failed to eliminate it entirely, rejecting defendant’s argument of res judicata. Instead, the court of appeal found that “the complexity of and convoluted circumstances” of the case constituted “exceptional circumstances,” thereby relieving plaintiff of the preclusive effect of the final judgment in his first suit. The Louisiana Supreme Court granted defendant’s writ of review, limiting the argument to the issue of res judicata.

The Chauvin case involves essentially the same issue except that, rather than a jury verdict in the first instance, the parties entered into a settlement agreement. The defendant settled plaintiff’s fear/increased risk claim and received a release from all future claims, except for future cancers. Plaintiff later developed cancer and filed another lawsuit, including a claim for punitive damages. The defendant sought dismissal of all claims barred by plaintiff’s prior settlement. The trial court agreed and granted defendant’s exception of res judicata as to all claims, including punitive damages, other than damages for future cancer. Plaintiff appealed, and the court of appeal reversed the trial court’s judgment as it pertained to punitive damages, finding an exception to res judicata. The Louisiana Supreme Court granted defendant’s supervisory writ.

Oral argument was heard in both cases on Monday, October 13, 2014.

 

By Tyler Moore Kostal

Recently, the Louisiana Supreme Court granted a writ application to the Fourth Circuit Court of Appeal in Watkins v. Exxon Mobil Corporation, et. al.—an action involving plaintiff’s damages from decedent’s potential NORM (i.e., naturally occurring radioactive material) exposure. The central issue before the court is whether the one-year period to bring a survival action under Louisiana Civil Code Article 2315.1 is peremptive or prescriptive. Prior to the Fourth Circuit’s ruling in Watkins, the First, Second, Third, and Fifth Circuits weighed in on the issue and concluded that the one-year period is peremptive and thus not subject to suspension or interruption. Because the Fourth Circuit reached the opposite conclusion, holding that the one-year period in Art. 2315.1 is prescriptive, not peremptive, there is now a clear split on the issue in the circuit courts of appeal. Should the court find the one-year period to be prescriptive, the right to bring a survival action could be extended exponentially, contrary to the longstanding interpretation of the survival statute.

Oral argument is set for Monday, January 27, 2014.

By Scott D. Huffstetler

The Occupational Safety and Health Administration (OSHA) is seeking public comments regarding a proposal for a new online whistleblower complaint form. The form, which would allow whistleblowers to electronically submit whistleblower complaints directly to OSHA, is part of OSHA’s proposal to revise the information collection requirements for handling retaliation complaints filed with OSHA under various whistleblower protection statutes. The proposal may be accessed electronically here, and comments are due on or before March 18, 2013.

OSHA is responsible for investigating alleged violations of whistleblower provisions contained in a number of statutes. These statutes include:

  • Occupational Safety and Health Act, 29 U.S.C. 660
  • Asbestos Hazard Emergency Response Act, 15 U.S.C. 2651
  • International Safe Container Act, 46 U.S.C. 80507
  • Safe Drinking Water Act, 42 U.S.C. 300j-9(i)
  • Federal Water Pollution Control Act, 33 U.S.C. 1367
  • Toxic Substances Control Act, 15 U.S.C. 2622
  • Solid Waste Disposal Act, 42 U.S.C. 6971
  • Clean Air Act, 42 U.S.C. 7622
  • Energy Reorganization Act of 1974, 42 U.S.C. 5851
  • Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. 9610
  • Wendell H. Ford Aviation Investment and Reform Act for the 21st Century
  • Corporate and Criminal Fraud Accountability Act of 2002 (Title VIII of the Sarbanes-Oxley Act of 2002)
  • Pipeline Safety and Improvement Act of 2002
  • National Transit Systems Security Act and the Federal Railroad Safety Act
  • Consumer Product Safety Improvement Act of 2008
  • Affordable Care Act, 29 U.S.C. 218C
  • Consumer Financial Protection Act, Section 1057 of the Dodd Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203
  • Seaman’s Protection Act, 46 U.S.C. 2114, as amended by Section 611 of the Coast Guard Authorization Act of 2010, Public Law 111-281
  • Section 402 of the FDA Food Safety and Modernization Act, Public Law 111-353
  • Section 31307 of the Moving Ahead for Progress in the 21st Century Act, 49 U.S.C. 30171

The electronic form expands the methods in which a whistleblower may submit a complaint to OSHA under one of these statutes – either by submitting the form electronically directly through the Internet; or by downloading, completing, and submitting the form to OSHA by fax, mail, or hand-delivery. The proposed form will enable workers to electronically submit whistleblower complaints directly to OSHA 24-hours a day. Last year, a record number of whistle-blower cases were filed and resolved by OSHA. This was after a series of initiatives were launched during the 2012 fiscal year to strengthen OSHA’s whistleblower protection programs. It is believed that the current proposals, if accepted and initiated in 2013, will result in an even greater number of OSHA whistleblower claims being filed.

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.

Our 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 manuscript focuses on the practical aspects of obtaining information needed for compliance, common misconceptions and risk avoidance. The manuscript 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.

 

By Mark D. Mese

The purpose of this post is to provide insureds with general information that will assist them in recognizing important facts and issues related to insurance coverage of environmental disasters. The primary areas addressed include (1) understanding the general types of potential insurance coverage; (2) recognizing environmental disasters; (3) deciding what to do once an environmental disaster is discovered to improve the possibility of insurance coverage and finally, (4) long term plans to improve coverage of potential future environmental disaster claims.

Insurance Policies

Insurance Coverage for Environmental Disaster Coverage is a complicated subject that must consider many different issues over many different timelines and many different jurisdictions with many different types of hazards. Understanding what an environmental disaster is and recognizing that one has occurred is the first thing an insured must do. Until the insured has recognized that an environmental disaster has occurred, it cannot ask the insurer for coverage and it cannot provide notice and coverage cannot be triggered. There are many different types of environmental disasters, a brief review of the history of the pollution exclusion in general liability policies provides some prospective as to how insurers look at environmental disasters and coverage.

Early standard general liability policies issues prior to 1966 contained insuring agreements that provided coverage for injury (caused by accident). The standard insurance service organization (ISO form) which is a general liability form used by most insurers was revised in 1966 to provide coverage for an “occurrence” with neither “expected” nor “intended” by the insured and specifically included continuous or repeated exposure to substantially the same conditions in its coverage. As a result of these changes, claims related to environmental damages increase dramatically. Insurers using the standard form added a mandatory endorsement in 1970 (ISO Form 00020173 1973) that excluded coverage using the following language:

“Bodily injury or property damage arising out of the discharge, dispersal, release or escape of smoke vapors, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any watercourse or body of water.”

The referenced ISO form was often used in conjunction with a carve-back in of coverage which provided: “this exclusion does not apply if such discharge, dispersal, release or escape is sudden and accidental.”

As you might expect, and as many of you may know, the 1970’s and 1980’s were a turbulent period for insureds and insurers who were engaged in coverage disputes under CGL policies for pollution related claims. Courts in the various jurisdictions reached different conclusions and were often at odds which made predicting coverage difficult.

The insurers, through the insurance service organization, created an absolute pollution exclusion in 1985 (See ISO form CG0021207), which excluded coverage for the following:

“Bodily injury” or property damage” arising out of the actual, alleged, or threatened discharge, dispersal, release or escape of pollutants:

At or from any premises, site or location which is or was at any time owned, occupied, or rented or loaned to, an insured[.]

“Pollutants” means solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed.”

The absolute pollution exclusion lacked an exception for coverage for sudden or accidental problems and it did not provide coverage for allegations or threats of a polluting event and it also eliminated the requirement for a discharge into a foreign land, the atmosphere or water course or a body of water.

Not surprisingly, the absolute pollution exclusion was a source of significant litigation between insureds and insurers and lead to various interpretations by courts across the country. Some courts fell into a camp which accepted the insurance industry’s broad interpretation of the exclusion. Another group affords limited exclusion to damages when an undefined claim involved harm to the broader environment. Another group of courts found that the exclusion was ambiguous or required to be interpreted based on history of the exclusion and looked at the presentations of the insurance industry to the various insurance commissioners in the various states “Doer v. Mobil Oil Corporation,” 774 So.2d 119, 2000-0947, (La. 12/19/00). Knowing which state an environmental disaster is in and more importantly, what state law is going to apply to coverage, becomes very important and can be important in planning litigation as will be discussed below in some detail.

There are many types of insurance products today providing various types of coverage for environmental disasters. A review of all of the different products available is beyond the scope of this paper. Coverage ranges from limited coverage provided via endorsements to CGL policies to stand alone policy forms. Over the years, insureds have sought an expansion of coverage to avoid the gaps created by the pollution exclusions in CGL policies. In recent years there has been a significant increase in the number of carriers providing environmental coverage products compared to the limited market of even five or six years ago. Based on work with brokers over the last year or so, it appears that there are around 30 different insurers now offering some form of environmental coverage. Coverage available for environmental claims is more readily available currently on a claims made basis; although occurrence based insurance is also sometimes available.

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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.