Adams v. Shell Oil Co.

136 F.R.D. 588, 1991 U.S. Dist. LEXIS 7191
CourtDistrict Court, E.D. Louisiana
DecidedMarch 20, 1991
DocketCiv. A. Nos. 88-1935, 88-2719
StatusPublished
Cited by11 cases

This text of 136 F.R.D. 588 (Adams v. Shell Oil Co.) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Adams v. Shell Oil Co., 136 F.R.D. 588, 1991 U.S. Dist. LEXIS 7191 (E.D. La. 1991).

Opinion

ORDER AND REASONS

MENTZ, District Judge.

The subject of this Order and Reasons is the establishment of a trial plan.

I. BACKGROUND

The plaintiffs filed this suit for a class action against the defendants, Shell Oil Company and Brown & Root U.S.A., Inc., claiming actual and punitive damages from the May 5, 1988 explosion in the catalytic cracking unit at the Shell Oil Refinery in Norco, Louisiana. The actual damages alleged include death, physical and mental injuries, property damage, and environmental damage. The punitive damage claim is based on Louisiana Civil Code article 2315.3 [590]*590which provides a remedy for punitive damages where “the plaintiff’s injuries were caused by the defendant’s wanton or reckless disregard for public safety in the storage, handling, or transportation of hazardous substances or toxic substances.” La. Civ.Code Ann. Art. 2315.3 (West Supp. 1991).

The Court certified the suit as a class action under Federal Rule of Civil Procedure 23(b)(3) on November 28, 1988.1 The class is defined as follows:

All persons or entities who were physically present or owned property within the Parishes of St. Charles, St. John the Baptist, St. James, Orleans or Jefferson on May 5, 1988, and who sustained injuries or damages as a result of the explosion at the Shell Oil Refinery in Norco, Louisiana.

Pursuant to Federal Rule of Civil Procedure 23(c)(4)(A)2, the Court established two subclasses. See Order entered November 28, 1988, Rec.Doc. # 349. The common issues in Subclass A, which apply to all class members, are: 1) the determination of the defendants’ legal liability for compensatory damages resulting from the explosion; and 2) the determination of the defendants’ legal liability for punitive damages. The common issue in Subclass B, which applies to the Shell employees who were working at the time of the explosion, is Shell’s liability for intentional tort.3

A Notice of Class Action was mailed to approximately 25,000 persons and entities who were reasonably believed to be potential class members. The notice was also published in various newspapers with a general circulation in the geographic boundaries of the class, as well as posted in the parish courthouses. The notice established a reasonable period for opting-out of the class action. See Notice of Class Action, Appendix A to this Order. Approximately 1,240 potential class members opted-out of the class action.

Thirty-four individual suits were filed on behalf of the plaintiffs who opted-out of the class action.4 The Court consolidated those suits under the caption Robert Adams, Sr. v. Shell Oil Company, Civil Action No. 88-2719, Section “I” (E.D.La.), and then consolidated the Adams cases with the class action, but only for the purpose of discovery on the issues of liability and punitive damages. See Minute Entry entered August 1, 1989, Rec.Doc. #795a. The Court ordered the consolidations pursuant to Federal Rule of Civil Procedure 42(a) to eliminate costly and unnecessary discovery on identical issues. Later, the Court ordered that there shall be one punitive damage trial, and consolidated all opt-out cases with the class action for trial on punitive damages. See Minute Entry entered April 4,1990, Rec.Doc. # 1004f; Manual for Complex Litigation, Second, § 21.631 at 109 (1985) (Under Rule 42(a), class actions may be consolidated with cases instituted by opt-out plaintiffs.) The opt-out cases must wait to try compensatory damages until after the punitive damage trial.

The purpose of punitive damages is to punish outrageous conduct and deter such conduct in the future. See Sharp v. [591]*591Daigre, 564 So.2d 303 (La.1990) (Dennis, J., dissenting); Creech v. Aetna Casualty & Surety Co., 516 So.2d 1168, 1173 (La. App.2d Cir.1987), writ denied, 519 So.2d 128 (La.1988). Where the defendant’s conduct occurs in a single incident, such as the explosion at Shell’s refinery, the defendants’ conduct towards each plaintiff is identical. Thus, multiple punitive damage trials for a single course of conduct are not only redundantly time consuming and expensive, but can repetitively punish the defendant resulting in overkill.

The Court is aware that the Fifth Circuit has held in two asbestos cases that multiple punitive damage awards for the same course of conduct do not violate due process. See King v. Armstrong World Indus., Inc., 906 F.2d 1022 (5th Cir.1990), followed with reservations in Edwards v. Armstrong Indus., Inc., 911 F.2d 1151, 54-55 (5th Cir.1990). The Fifth Circuit made these rulings despite its “misgivings,” and in King, quoted the following passage from Judge Friendly’s opinion in Roginsky v. Richardson-Merrell, Inc., 378 F.2d 832, 839 (2d Cir.1967): “The legal difficulties engendered by claims for punitive damages on the part of hundreds of plaintiffs are staggering____ We have the greatest difficulty in perceiving how claims for punitive damages in such a multiplicity of actions throughout the nation can be so administered as to avoid overkill.” King, 906 F.2d at 1033.

Nothing in the Fifth Circuit’s opinion in King or Edwards precludes a single punitive trial under the circumstances in the present case. The fact that a procedure has passed constitutional muster does not necessarily mean that a departure from that procedure denies due process. See Pacific Mutual Life Insurance Co. v. Haslip, — U.S. -, 111 S.Ct. 1032, 113 L.Ed.2d 1 (1991) (Scalia, J. dissenting).

The facts in this case present a situation in which a single punitive damage trial is feasible. Unlike the asbestos cases and other cases affecting plaintiffs nationwide, and involving a course of conduct occurring over a long period of time as well as the likelihood of future claims, the present case involves a single event affecting, at one time, certain people in a five-parish area within the Eastern District of Louisiana. By virtue of the class certification, all of the claimants are before this Court. Thus, under the circumstances of this case, a single punitive damage trial is an available alternative that satisfies the best interests of both parties.

All opt-out plaintiffs were given an opportunity to become what the Court and the parties have called “double-opt-outs,” by waiving the right to claim and recover punitive damages. The reason for creating this category was to accommodate those opt-out plaintiffs who objected to their claims being consolidated with the class action on the ground that it would delay resolution of their compensatory damages. The opt-out plaintiffs were advised that if they elected to double-opt out they would be given quick trial dates.

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Bluebook (online)
136 F.R.D. 588, 1991 U.S. Dist. LEXIS 7191, Counsel Stack Legal Research, https://law.counselstack.com/opinion/adams-v-shell-oil-co-laed-1991.