IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF OKLAHOMA PLAINTIFFS NOTICE CONCERNING POTENTIAL TRIAL GROUPS

Transcription

1 Case 5:13-cv M Document 139 Filed 04/11/17 Page 1 of 15 IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF OKLAHOMA HELEN BRIGGS, et al., ) ) Plaintiffs, ) ) v. ) Case No. 5:13-cv M ) FREEPORT-MCMORAN COPPER ) & GOLD, INC., et al. ) ) Defendants. ) PLAINTIFFS NOTICE CONCERNING POTENTIAL TRIAL GROUPS COME NOW Plaintiffs, by and through counsel, to respectfully submit this notice concerning potential trial groups or more generally, how to best organize this Mass Tort case for trial. This notice is being filed in accordance with the Court s Amended Scheduling Order [Doc. No. 87]. BACKGROUND On January 12, 2015, the Court entered an amended scheduling order [Doc. No. 87] in this case, which at Paragraph 5 and footnote 1 directed the parties to confer regarding the size and methodology for selecting a potential trial group. In Paragraph 5 of Doc. No. 87, the Court s order contemplates that such a trial group may be necessary if the class is not certified, if the certification is limited to certain issues, or if the parties retain separate or individual non-class claims. In accordance with the Court s Amended Scheduling Order, on February 23, 2015, Plaintiffs filed their Motion for Class Certification [Doc. No. 90]. On May 6, 2015, the 1

2 Case 5:13-cv M Document 139 Filed 04/11/17 Page 2 of 15 Court entered an order denying Defendants Motion to Dismiss, in toto, holding that Plaintiffs pled sufficient facts to state a plausible claim directly against all Defendants [Doc. No. 94. at 6] ( [T]he Court finds that plaintiffs have pled sufficient facts to state a plausible claim against the Non-BZC Defendants for direct liability with respect to plaintiffs claims of trespass, private nuisance, public nuisance, negligence, and negligence per se. ). The Court further held that Plaintiffs pled sufficient facts to state a claim against all defendants based on agency [Doc. No. 94. at 7-8]. The Court also held that Plaintiffs sufficiently pled an alter ego theory of liability against all Defendants, if barely. [Doc. No. 94 at 9]. On April 27, 2015, Defendants timely responded to Plaintiffs Motion for Class Certification [Doc. No. 100]. On June 25, 2015, Plaintiffs replied in a timely fashion in support of their Motion for Class Certification [Doc. No. 106]. Defendants filed their surreply on the Motion for Class Certification on July 24, 2015 [Doc. No. 118]. On March 28, 2017, the Court denied Plaintiffs Motion for Class Certification [Doc. No. 135]. Specifically, the Court found that joinder of Plaintiffs in this litigation was not impracticable [Doc. No. 135 at 5-6] ( The Court finds that joinder is not impracticable. ). The Court also indicated that it views this as a damages case, and not an injunctive relief case. Id. at 6-7. PRACTICALITIES Practically speaking, this is a case about toxic pollution requiring the presentation of expert evidence. Most claims in this case have a diminution in property value between $15,000 and $100,000. The presentation of Plaintiffs expert evidence is expected to cost 2

3 Case 5:13-cv M Document 139 Filed 04/11/17 Page 3 of 15 approximately $50,000 per trial. The cost to put on the expert evidence in ten or a hundred trials would be prohibitively prejudicial to Plaintiffs. See Doc. No. 90 at 13. Moreover, multiple trials of Plaintiffs against the same Defendants may produce variable results, with some juries holding Defendants liable, and other juries not, a variable result that does not reflect well on the judicial process. Id. Practically speaking, and despite their elegant protests, there are not serious liability questions in this case. Defendants agreed that the scientific evidence that they prepared shows that their emissions of cadmium from the smelter, which are now found on the Plaintiffs homes, match up perfectly. Specifically, the Defendants argued: Smelter emissions included lead, arsenic, and cadmium (not just one in isolation, but all three together in predictable ratios). The air model and the median soil sampling data for cadmium match up perfectly. DX 5 at 6. Stated differently, the median cadmium levels decline the further away the sample is from the Smelter site. This validates the accuracy of the air model of historical smelter impacts. On the other hand, lead results do not match soil levels. Instead, in many locations median lead results are 3 to 4 times higher as distance from the Smelter increases. Why is lead so much different from cadmium? The answer is that something other than Smelter air deposition is responsible for lead in Blackwell soils, and that something is lead paint. Doc. No. 100 at (emphasis added). While the Defendants argument is that they are not responsible for all the lead contamination (essentially, they urge that lead paint contributed to the lead pollution in Blackwell), they admit, based on their own air modeling, that they are responsible for the cadmium contamination on Plaintiffs properties it match[es] up perfectly. The Plaintiffs have complained that their properties are contaminated with Lead, Cadmium, Arsenic, and other heavy metals. See Doc. No. 65 at 3 ( Plaintiffs are landowners in and around Blackwell, Oklahoma, and 3

4 Case 5:13-cv M Document 139 Filed 04/11/17 Page 4 of 15 their property is in areas known or believed to be contaminated by Defendants waste, including Lead, Cadmium, Zinc and other metals and polluting materials. ); Id. at 122, 130; Id. at 133 ( Defendants also admit that DHHS classifies cadmium as a known human carcinogen, IARC classifies cadmium as a human carcinogen, and EPA classifies cadmium as a probable human carcinogen. ). In the context of briefing the issues of class certification, the bulk of the effort necessary to prepare the case for trial has been completed. The parties retained expert witnesses. Some (but not all) of the expert depositions have been taken. The parties deposed many (but probably not all) of each other s fact witnesses. A great deal of information has been discovered and shared by all parties, and databases of discovery information have been managed with all parties already identifying to the Court many exhibits that tend to prove their cases or defenses. Accordingly, much of the work (perhaps most) needed to prepare the case for trial has been completed, and the issues remaining for trial have been narrowed and focused largely on the question of Plaintiffs damages. MANAGING TRIAL The Court declined to use the procedural tool of class certification to manage the trial in this case, and instead decided to join each of the nearly 150 or so claims in a single action. The Amended Scheduling Order, as outlined above, prior to the class certification order raised the issue of whether and to what degree trial groups can be employed to resolve this case as a Mass Tort. When the parties conferred on April 6, 2017, their views on how to manage trial groups, if any, were widely divergent. Defendants proposed a series of trials, where each 4

5 Case 5:13-cv M Document 139 Filed 04/11/17 Page 5 of 15 trial would have 3 plaintiffs. Defendants would not agree that the outcome of any one or more of the trials would be used to extrapolate a settlement for all the cases, but they offered that the trials might aid in future settlement. Plaintiffs indicated that such small trial groups would be prejudicial because the cost of marshalling the expert testimony for each trial would be approximately $50,000, no matter whether the case concerned 3 plaintiffs or all 150. It is possible that in any trial of 3 Plaintiffs there may not be $50,000 in diminution of property value at issue (though in some cases there would be greater diminution claims). Thus, many of Defendants proposed trial groups would cost more just in expert witness fees than the diminution in value claims. Additionally, per Defendants proposal, they would be able to veto the most valuable of the Plaintiffs claims from the early trial groups, ensuring that the larger claims would not be heard at first. Accordingly, making the trial groups so small as to only allow 3 per trial would work a hugely prejudicial hardship on Plaintiffs. While Plaintiffs will be able to recover their attorney fees upon successfully prevailing, their expert witness costs are not recoverable. The result of Defendants proposal would be to significantly diminish (or eliminate) the amount of damages any Plaintiff would recover after a Plaintiff prevails because the damages Plaintiffs would obtain would be eaten up by the expert witness costs of prosecuting the toxic elements of the case. And, the Defendants can be expected to take their early losses in the smaller cases and try to use the lessons they learn in do over trials that would be deferred until later after they veto the larger claims from the early trial groups. The entire process proposed by Defendants was prejudicially unfair to Plaintiffs. 5

6 Case 5:13-cv M Document 139 Filed 04/11/17 Page 6 of 15 Plaintiffs inquired whether Defendants would entertain larger trial groups, and Plaintiffs suggested for the purposes of discussion trial groups of 50 plaintiffs at a time. Defendants would not even consider a trial group of 50, but also did not articulate why 50 plaintiffs were not feasibly joined in a single trial (let alone all 150 or so). As noted above, the question of Defendants liability is not seriously in question since they admit that they are responsible for the carcinogenic cadmium (a heavy metal ) on the Plaintiffs properties, and because they have not postulated how the cadmium would be transported differently from the smelter than the Defendants other heavy metal emissions (e.g., Lead and Arsenic). Indeed, the toxic heavy metals either were emitted from the plant s stacks, or improperly disposed of throughout the town by the Defendants allowing their wastes to be used as building and road materials. Other than Defendant s Lead paint theory (which is contradicted by their own Cadmium modeling), what is left, then, is the question of the amount of damages owed to each Plaintiff. That figure is partly represented by the diminution in property value, and by the inconvenience and annoyance to which each Plaintiff was subjected (and continues to be subjected). Moreover, to the extent the Plaintiffs can show that Defendants heavy metal emissions were grossly negligent or done with malice, a Jury should award punitive damages against the Defendants. Such a result is not hard to imagine when the facts are well known that the Defendants stopped operating the smelter only because they did not want to bear the expense of installing pollution control devices that would have protected human health and that could have eliminated the entire problem in the first place. 6

7 Case 5:13-cv M Document 139 Filed 04/11/17 Page 7 of 15 This case can be managed in a single trial, and it is indisputable that it would be much more efficient to have a single trial. If there is a single trial, then each of the experts would only testify one time. Assuming each expert would testify for 1 day (there are 3 Plaintiff experts and 5 Defense experts), that is 8 trial days. Assuming each Plaintiff can set out her relevant facts in 2 hours, that would be 70 hours of trial time (or about 2 weeks). Assuming another week for all other needed fact witnesses (company witnesses, third parties with pertinent knowledge), and two days for preliminary matters and for closing argument, then a trial of all 150 (approximately) claims at once would take about 25 trial days or 5 weeks which is not an unheard-of length of time for a complicated trial. On the other hand, Defendants proposal would take much longer. Even if one would assume in a wildly optimistic best case scenario that all the cases would settle by agreement after only 3 trials of 3 groups of 3 plaintiffs. Each of the 3 trials would still require 8 days of expert testimony (24 days). Each trial would require another week of fact testimony of company and third party witnesses (15 days), and each trial would require a day of the 3 Plaintiffs testimony (3 days). Each trial at a minimum would require 2 days of preliminary matters and closing argument (6 days). As a result, it would take at least 48 trial days nearly 10 weeks to try just 9 of the Plaintiffs claims. Accordingly, it would take nearly twice as long to try just 9 of the 150 (or so) claims as it would take to try all of them. If one would not assume that there is a wildly optimistic chance of settlement of all claims after 3 trials, but pragmatically that each case will require a trial (particularly given Defendants do-over approach), then overall it will take nearly 1,000 trial days, or well more than 4 years, to resolve the claims presently and properly 7

8 Case 5:13-cv M Document 139 Filed 04/11/17 Page 8 of 15 before the Court using the Defendants proposal. The cost to the Plaintiffs would be staggering they would have to spend $2,500,000 just on expert witnesses to repeat the same answers to the same questions 50 times to 50 different juries. That would also yield staggering costs to the Court as it paid for tens of thousands of juror days from funds that could be used elsewhere. The Defendants proposal would require an enormous waste of resources, would benefit only them, would severely prejudice the Plaintiffs, and would waste the Court s resources. Moreover, even if the cases could be resolved after 3 trials (involving about 2 months of the Court s trial time), Defendants proposal would require empaneling 3 juries, requiring unnecessarily dozens of jurors to serve and be paid from the Court s limited resources. And, then there is the question of the Court sitting through the same exact testimony and argument between the same experts and other witnesses over and again with the only practical change being the identity of the jurors. Defendants justification for small trial groups was that each of the tort claims would somehow require different testimony. But, Defendants do not propose even one solitary real fact to show how one real plaintiff would require proof different from another. The theory they propose is not supported with evidence. Rather, as their own expert witnesses concede, there are sample reports showing the level of contamination on every single property owned by each of the named plaintiffs. The same experts on both sides will engage in the same battle over what those same reports mean for each Plaintiff, with Defendants using the same expert in every case to urge that the levels of heavy metals either come from lead paint, or are inconsequential, and with Plaintiff s experts showing 8

9 Case 5:13-cv M Document 139 Filed 04/11/17 Page 9 of 15 how the levels are dangerous and have caused injury in the past, and how even the Defendants agree that the Cadmium on the Plaintiffs property match[es] up perfectly with their emissions. The trial testimony will largely be a discussion of a spreadsheet of heavy metal contamination data, and a map showing where the heavy metal contamination rests. That spreadsheet and that map will be identical in every case, discussed by identical experts (for all parties), with identical questions on identical direct and cross examination. As Defendants own expert opined and as Defendants noted, the source of the contamination of Cadmium (their smelter) which is found on the Plaintiffs properties match up perfectly. That match doesn t change when the parties change because the modeling, the spreadsheets, the maps, the witnesses, the exhibits, and even the questions will always be the same. Additionally, the testimony regarding damages will likewise be the same map of damaged properties, but in this case a spreadsheet calculating how each property s value is diminished because of the heavy metal contamination. In every case, the parties can be reasonably expected to engage the same experts who will reach the same conclusions regarding each property, with the Plaintiffs urging that the heavy metal contamination has reduced the value of their homes, and the Defendants urging that it is all just lead paint, and that no diminution exists. Again, the same witnesses, the same documents, the same testimony, with only the faces of the jurors changing as 3 new plaintiffs are rotated in for another month of trial before the Court, for over 4 years. 9

10 Case 5:13-cv M Document 139 Filed 04/11/17 Page 10 of 15 Plaintiffs were willing to reach a reasonable compromise with Defendants in preparing trial groups (and remain willing to reach a reasonable approach for managing trial). Plaintiffs suggested that the parties agree to a single bell weather trial based on representative plaintiffs, where the results of the jury verdict regarding a limited number of Plaintiffs would be extrapolated to all Plaintiffs, coupled with a high/low arrangement agreed to by the parties to insulate all parties against a runaway jury. Such limits would make trial and settlement a feasible solution. Defendants flatly would not agree to any such proposal a proposal that benefited them as much as the Plaintiffs. Defendants implied that their approach of trials of 3 Plaintiffs is a bell weather. It is not. A bell weather trial is not an open-ended enterprise where the outcome of each trial does nothing more than bind the parties in that trial. The Annotated Manual for Complex Litigation (3d) (2002) indicates at page 424, note 1094 and at page 425, note 1100, how such bell weather trials are used to extrapolate (with the agreement of the parties) to reach a result, not just more litigation or a potential settlement. While something can be learned from small trials, and in some situations such test cases might be practical, the price of that education in this case is too high to be considered reasonable without some agreement from the Defendants that they will not simply take their first losses to litigate the next case, hoping they learned from their losses how to obtain a better outcome in a do over trial where the stakes increasingly become greater. More than just a series of do overs that are severely prejudicial to Plaintiffs who would appear in later trials, Defendants appear to be attempting to use their enormous financial advantage as one of the largest mining companies in the world to discourage any 10

11 Case 5:13-cv M Document 139 Filed 04/11/17 Page 11 of 15 of the Plaintiffs from seeking justice because it will cost each Plaintiff, on average, as much or more than they might receive from a jury to put on the expert testimony necessary to prove their claims if they are required to try their claims in small trials. Put plainly, Defendants proposed approach is severely prejudicial to the Plaintiffs both because it gives Defendants an improper tactical advantage (multiple do overs ) and allows them to use their significant financial advantage to deny the Plaintiffs justice. Plaintiffs consulted with the Annotated Manual for Complex Litigation (3d) (2002), which at section outlines different approaches that might be taken to manage Mass Tort trials through the use of trial groups. Plaintiffs also consulted with the Florida Court manual that similarly outlines processes the Court may consider in managing this trial. Available at ManMassTortCa.pdf. As both treatises discuss, there have been mass tort trials across the country, even with as many as 8,000 plaintiffs all appearing in one single trial. And, as both treatises indicate, there can be reasons to have more than one trial, including because different Defendants injured different Plaintiffs, or where some Plaintiffs hold different claims than other Plaintiffs. Thinking about the case before this Court, there is but one set of Defendants (particularly considering the Alter Ego and Agency allegations). The questions of causation are the same as demonstrated by the Defendants air dispersion model to prove that their cadmium found on the Plaintiffs properties match[es] up perfectly with emissions from their smelter. 11

12 Case 5:13-cv M Document 139 Filed 04/11/17 Page 12 of 15 There is, however, one place where a practical distinction may reside in this case: in relation to residential and commercial properties. There is a group of claims for diminution in the value of residential property (the bulk of the claims), and there is also a (smaller) group of claims for commercial property damage. The commercial claims would reasonably also include business interference and interruption damages. Those business damages may, therefore, require somewhat different proof. Indeed, Plaintiffs excepted the business damage claims from the proposed class, The Plaintiffs feel that it was this distinction between business and personal damages that the Court most likely was considering when it referred to trial groups and the potential for non-class claims in the Amended Scheduling Order. Even in the instance where a group is chosen based on an arbitrary basis (3, 10, or 50 plaintiffs) or where a group is determined based on practical differences (residential versus business damages), there will be more than one jury, and each jury will be asked to impose punitive damages. It is conceivable that each jury will award significant punitive damages punishing the Defendants for their conduct. 1 In the aggregate, the Defendants could be exposed to an overall punitive damages award that is much greater because there were 50 trials (Defendants suggestion), not 1 or 2 (Plaintiffs suggestion). Accordingly, it should be noted that Defendants should not be permitted to later complain in this Court or on appeal that the award of punitive damages in the 50 trials they are suggesting is unjust, because they will have caused the problem about which they would be complaining. 1 Potentially uncapped because the heavy metal contamination threatens human health. 12

13 Case 5:13-cv M Document 139 Filed 04/11/17 Page 13 of 15 CONCLUSION Taking all these issues into account, and desiring only a speedy and reasonable resolution of their claims, the Plaintiffs respectfully suggest that the most efficient way to try this case is in one trial, with all the Plaintiffs appearing. The evidence is the same, the witnesses are the same, the exhibits are the same, the questions are the same, and the arguments are the same. If the Defendants were amenable, a bell weather agreement with a high-low limit to extrapolate a final resolution by agreement would make sense. Because a reasonable agreement does appear to be offing, the Plaintiff suggest that it is not reasonable to assume at a few small trials (which give Defendants a do over as the stakes loom larger in the cases yet to come) will change Defendants perspective or encourage a later settlement. Accordingly, the Plaintiffs suggest a pragmatic rather than an optimistic approach to trial planning is best. If the Court were to take the optimistic approach, it may well end up confining the Court, hundreds of jurors and the Parties to as many as 1,000 trial days, repeating the same evidence over and again as the Defendants take advantage of their do overs and financial might. It should be noted that the Defendants would take that advantage at great expense to the Court (up to 1,000 court days), the potential jurors (thousands of juror days) and the Plaintiffs (by diminishing the value of many of the cases in expert witness fees that cannot be recovered). Accordingly, the Plaintiffs respectfully suggest that one trial of all claims would appear to be the most efficient, and reasonable. Alternatively, the Plaintiffs believe it may also make sense to organize residential claims into one group, and business claims into another. 13

14 Case 5:13-cv M Document 139 Filed 04/11/17 Page 14 of 15 Respectfully submitted, /s/jason Aamodt Jason Aamodt, OBA No Krystina E. Phillips, OBA No Dallas L.D. Strimple, OBA No INDIAN AND ENVIRONMENTAL LAW GROUP, PLLC 204 Reunion Center Nine East Fourth Street Tulsa, Oklahoma Telephone: (918) Facsimile: (918) and Trae Gray, OBA No Ryan Ellis, OBA No LANDOWNERFIRM, PLLC Rt. 5, Box 305 Coalgate, Oklahoma Telephone: (580) Facsimile: (888) ATTORNEYS FOR PLAINTIFFS 14

15 Case 5:13-cv M Document 139 Filed 04/11/17 Page 15 of 15 CERTIFICATE OF SERVICE I hereby certify that on Tuesday, April 11, 2017, I electronically transmitted the attached document to the Clerk of Court using the ECF System for filing and transmittal of a Notice of Electronic Filing to the following ECF registrants: Reid E. Robison reid.robison@mcafeetaft.com Timothy J. Bomhoff tim.bomhoff@mcafeetaft.com Sandra G. Rodriguez srodriguez@velaw.com Morgan L. Copeland mcopeland@schickcopeland.com Lewis C. Sutherland lsutherland@velaw.com Tracey K. Rice trice@schickcopeland.com Kevin A. Gaynor kgaynor@velaw.com Robert M. Schick rschick@schickcopeland.com /s/jason Aamodt 15