Justia Class Action Opinion Summaries

Appellant/cross-appellee OXY USA Inc. appealed the grant of summary judgment to appellees/cross-appellants, a class of plaintiffs represented by David and Donna Schell, and Ron Oliver, on the question of whether their oil and gas leases required OXY to make "free gas" useable for domestic purposes. OXY also appealed: the district court’s certification of plaintiffs' class; the denial of a motion to decertify; and an order to quash the deposition of an absent class member. Plaintiffs cross-appealed the district court's: denial of their motion for attorneys' fees; denial of their motion for litigation expenses; and denial of an incentive award. Notably, plaintiffs also moved to dismiss the appeal as moot. OXY opposed dismissal for mootness, but argued that if the Tenth Circuit found mootness, the Court should vacate the district court’s decision. Appellees/cross-appellants were approximately 2,200 surface owners of Kansas land burdened by oil and gas leases held or operated by OXY, executed separately from approximately 1906 to 2007. The leases contained a "free gas" clause. The clauses weren't identical, but all, in substance, purported to grant the lessor access to free gas for domestic use. All of the plaintiffs who have used free gas obtain their gas from a tap connected directly to a wellhead line. In addition, some members of the plaintiff class (including about half of the current users of free gas) received royalty payments from OXY based on the production of gas on their land. In August 2007, OXY sent letters warning free gas users that their gas may become unsafe to use, either because of high hydrogen sulfide content or low pressure at the wellhead. These letters urged the lessors to convert their houses to an alternative energy source. On August 31, 2007, leaseholders David Schell, Donna Schell, Howard Pickens, and Ron Oliver filed this action on behalf of themselves and others similarly situated, seeking a permanent injunction, a declaratory judgment, and actual damages based on alleged breaches of mineral leases entered into with OXY for failure to supply free usable gas. After review of the matter, the Tenth Circuit held that that OXY’s sale of the oil and gas leases at issue here mooted its appeal; therefore, the Court granted plaintiffs’ motion to dismiss. Nevertheless, the Court concluded that the cross-appeal had not been mooted by this sale, and affirmed the district court’s judgment as to the denial of attorneys’ fees, litigation expenses, and an incentive award. View "Schell v. OXY USA" on Justia Law

Phillips owns an underground petroleum pipeline, built in 1930. A 1963 report stated that 100 barrels of leaded gasoline had leaked beneath West Alton, Missouri, and not been recovered. The leak was repaired. In 2002 a West Alton resident noticed a petroleum odor in his home. He contacted Phillips, which investigated. West Alton has no municipal water. Testing on the owner’s well disclosed benzene, a gasoline additive and carcinogen, at three times allowable limits. Phillips purchased the property, and two nearby homes and, with the Missouri Department of Natural Resources (MDNR), established a remediation plan. In 2006 Phillips demolished the homes, removed 4000 cubic yards of soil, and set up wells to monitor for chemicals of concern (COCs). Phillips volunteered to provide precautionary bottled water to 50 residents near the site. Sampling of other wells had not shown COCs above allowable limits. MDNR requested that Phillips test the wells of each family receiving bottled water before ending its water supply program. Phillips chose instead to continue distributing bottled water. Most of the recipients are within 0.25 miles of the contamination site. In 2011 nearby landowners sued, alleging nuisance, on the theory that possible pockets of contamination still exist. The Eighth Circuit reversed class certification, noting the absence of evidence showing class members were commonly affected by contamination, View "Smith v. ConocoPhillips Pipe Line Co." on Justia Law

Plaintiffs, holders of BP securities, filed suit against BP and two of its executives, alleging that BP made two distinct series of misrepresentations in violation of federal securities law: one series regarding its pre-Deepwater Horizon spill safety procedures, and one regarding the flow rate of the oil after the spill occurred. The district court only certified the post-spill class. Both sides appealed. The court concluded that the district court did not abuse its discretion in certifying the Post-Spill class where the district court determined that plaintiffs had established a model of damages consistent with their liability case and capable of measurement across the class, as required by the Supreme Court’s recent decision in Comcast Corp. v. Behrend. Accordingly, the court affirmed as to that issue. The court also affirmed the district court's decision not to certify the Pre-Spill class where plaintiffs’ materialization-of-the-risk theory cannot support class certification. View "Ludlow v. BP" on Justia Law

In these consolidated cases, BP appealed three settlement awards, related to the 2010 Deepwater Horizon oil spill, that it paid to nonprofits through its Court-Supervised Settlement Program. On appeal, BP argued that the Claims Administrator improperly interpreted the Settlement Agreement. The awards were based on the Claims Administrator’s determination that nonprofits may count donations and grants as “revenue” under the terms of the Agreement (the Nonprofit-Revenue Interpretation). As a preliminary matter, the court concluded that it has jurisdiction over this appeal under the collateral order doctrine and that BP's appeals were timely. On the merits, the court concluded that BP failed to show that the Nonprofit-Revenue Interpretation violates the plain language of the Agreement. The court held that the Nonprofit-Revenue Interpretation does not alter the class definition in violation of Rule 23 or Article III. Finally, the court concluded that there was no abuse of discretion in the district court's denial of review of the individual awards. Accordingly, the court affirmed the judgment. View "In Re: Deepwater Horizon" on Justia Law

Plaintiff filed suit against Denbury, alleging that Denbury breached its duty to act as a reasonable and prudent operator of the well that was drilled under oil, gas, and mineral leases. At issue on appeal was whether the district court erred in remanding the case on the basis that the local single event exclusion under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d)(11)(B)(ii), (ii)(I), applies to this case. The court concluded that the plain text of the exclusion supports plaintiffs' view that the terms "event" and "occurrence" are not generally understood to apply only to incidents that occur at a discrete moment in time. Moreover, this understanding is supported by legislative history and other case law interpreting the local single event exclusion. Therefore, the court held that, although the exclusion applied in cases in which the single event or occurrence happens at a discrete moment in time, the single event or occurrence may also be constituted by a pattern of conduct in which the pattern is consistent in leading to a single focused event that culminates in the basis of the asserted liability. Accordingly, the court held that the failure of the Well constituted the "event or occurrence" from which the claims of plaintiffs arose. The court affirmed the judgment of the district court. View "Rainbow Gun Club, Inc., et al. v. Denbury Onshore, L.L.C., et al." on Justia Law

ComEd closed its Zion nuclear power plant in 1998. A decommissioned nuclear must be “decommissioned” and not be dangerously radioactive. Decommissioning is supervised by the Nuclear Regulatory Commission, which requires the operator to finance the decommissioning. The details of the trust fund are left to the state agency, in this case the Illinois Commerce Commission, which (220 ILCS 5/9‐201.5(a)), authorized ComEd to create a trust to be funded by $700 million in charges levied by ComEd on its customers. The Act entitles ComEd customers to the return of money not spent when the decommissioning is completed. In 2001, with the permission of the ICC, ComEd transferred ownership of the Zion plant and the trust assets, to ComEd’s parent, Exelon. Neither Exelon nor its subsidiary is a public utility. Ordinarily the utility (ComEd) would have owned the plant after shutting it down, but transaction costs would be reduced by uniting financing and decommissioning in the same company. After several transfers, plaintiffs brought suit, claiming that the trust funds are being misused in violation of the Illinois Public Utilities Act and common law of trusts. The district court, without deciding whether to certify a class, dismissed. The Seventh Circuit affirmed, noting that that none of the plaintiffs are beneficiaries of the trust. View "Pennington v. ZionSolutions LLC" on Justia Law

This case stemmed from the Deepwater Horizon drilling platform oil spill. On appeal, BP challenged the district court's decision upholding the Claims Administrator's interpretation of the settlement agreement between it and the class of parties injured in the oil spill and the district court's dismissal of its action for breach of contract against the Administrator and denial of its motion for a preliminary injunction. The court concluded that the balance of equities favored a tailored stay where those who experienced actual injury traceable to loss from the Deepwater Horizon accident continued to receive recovery but those who did not receive their payments until this case was fully heard and decided through the judicial process weighed in favor of BP. Accordingly, the court reversed the denial of the preliminary injunction and instructed the district court to expeditiously craft a narrowly-tailored injunction that allowed the time necessary for deliberate reconsideration of significant issues on remand. The court affirmed the district court's dismissal of BP's suit against the Claim Administrator. View "In Re: Deepwater Horizon" on Justia Law

Plaintiffs filed suit against GenOn, on behalf of a putative class of at least 1,500 individuals who own or inhabit residential property within one mile of GenOn’s 570-megawatt coal-fired electrical generation facility in Springdale, Pennsylvania. The complaint asserted state tort law claims, based on ash and contaminants settling on plaintiffs’ property. The district court dismissed, finding that because the plant was subject to comprehensive regulation under the Clean Air Act, 42 U.S.C. 7401, it owed no extra duty to the members of the class under state tort law. The Third Circuit reversed, holding that the plain language of the Clean Air Act and controlling Supreme Court precedent indicate that state common law actions are not preempted. View "Bell v. Cheswick Generating Station, Genon Power Midwest, L.P." on Justia Law

Plaintiffs filed suit on behalf of themselves and other similarly situated landowners who used agents in an effort to lease oil and gas rights in Mercer County. When the transactions did not go as planned, plaintiffs sued an oil and gas company, Halcon, alleging breach of agreement and the duty of fair dealing. After Halcon claimed that the agents were “necessary parties,” plaintiffs decided to file direct claims against the agents, which destroyed diversity jurisdiction. Plaintiffs intended to pursue all of their claims in state court. Halcon argued that it did not oppose joining agents, agreed that the all claims would benefit from being heard in a single proceeding, but asserted that the case should proceed in federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d)(2), (d)(2)(A), (d)(5)(B), because discovery had begun and there were ongoing ADR activities. The district court dismissed without prejudice. Plaintiffs filed in state court, with some changes. Halcon then removed the state court action to the same federal district court, which again remanded, citing the “home state” exception to subject matter jurisdiction under CAFA. The Third Circuit affirmed, citing CAFA’s “local controversy” exception because the case relates to Pennsylvania owners and their land. View "Vodenichar v. Halcon Energy Props., Inc." on Justia Law

Defendant-Appellant XTO Energy, Inc. appealed a district court's certification of a class of Kansas royalty owners who sought recovery for its alleged underpayment of royalties. Specifically, the class claimed XTO violated Kansas law by improperly deducting costs for placing gas into a "marketable condition." After careful consideration, the Tenth Circuit concluded that the class did not meet Rule 23(a)'s commonality, typicality and adequacy requirements or Rule 23(b)(3)'s predominance requirement. Furthermore, the Court found the class' argument in favor of certification through collateral or judicial estoppel unavailing. The class certification order was vacated and the matter remanded for further proceedings. View "Wallace B. Roderick Revocable Trust v. XTO Energy" on Justia Law