In re Oil Spill by the Oil Rig "Deepwater Horizon"

902 F. Supp. 2d 808, 2012 WL 4610381, 2012 U.S. Dist. LEXIS 141546
District Court, E.D. Louisiana·Decided October 1, 2012·No. MDL No. 2179·Published·Cited by 3 cases

Opinion

ORDER & REASONS

[As to the Motions to Dismiss the Pure Stigma, BP Dealer, and Recreation Claims]

CARL BARBIER, District Judge.

Before the Court are certain Defendants’ 1 motions to dismiss the “Pure Stigma Claims,” “BP Dealer Claims,” and “Recreation Claims.”2 Oral argument was held on September 14, 2012. Having considered counsel’s arguments, the relevant record, and the applicable law, the Court finds the motions should be GRANTED as set forth below.

I. PROCEDURAL AND FACTUAL BACKGROUND

This matter 'arises from the April 20, 2010 blowout, explosion, and fire aboard the DEEPWATER HORIZON semi-submersible drilling rig as it was engaged in [812]*812oil exploration on the Outer Continental Shelf, and the subsequent discharge of millions of gallons of oil into the Gulf of Mexico. After cases were consolidated in a multidistrict litigation (“MDL”) proceeding, the Court created various pleading bundles to manage the numerous and varied claims asserted. See Pretrial Order No. 11, Rec. Doc. 569. Relevant here is the “Bl Bundle,” which concerns non-governmental claims for economic loss and property damage.

Pursuant to the Court’s instruction, the Plaintiffs’ Steering Committee (“PSC”) filed a Master Bl Complaint, Rec. Doc. 879, and an Amended Master Bl Complaint, Rec. Doc. 1128 (collectively, “Bl Master Complaint”), which asserted claims under the Oil Pollution Act of 1990 (“OPA”), 33 U.S.C. § 2701, et seq., general maritime law, and state law. Many defendants moved to dismiss the Bl Master Complaint. On August 26, 2011, the Court issued an Order and Reasons granting in part an denying in part these motions (“B1 Order”). Rec. Doc. 3830, 808 F.Supp.2d 943 (E.D.La.2011). The Bl Order held, inter alia, that the DEEPWATER HORIZON was a vessel, the claims in the Bl Master Complaint fall within the Court’s admiralty jurisdiction, and that general maritime law is not entirely displaced by OPA. Id. at 5-8, 18-27, 808 F.Supp.2d at 950-51, 958-63. However, to the extent maritime law supplements OPA, traditional limitations such as the Robins Dry Dock rule (discussed below) remain in effect. Id. at 26, 808 F.Supp.2d at 962. The Bl Order also held that state law was preempted by maritime law, notwithstanding OPA’s state-law savings clause, 33 U.S.C. § 2718. Id. at 8-18, 808 F.Supp.2d at 951-958; see also Order & Reasons of Nov. 14, 2011, Rec. Doc. 4578 at 6-17 & n. 19, 2011 WL 5520295, at *3-8 & n. 19 (finding penalties asserted under state law are preempted by the CWA, notwithstanding OPA’s savings clause).

On May 2, 2012, the Court preliminarily approved a proposed class-action settlement regarding many, but not all, claims by private parties for economic loss and property damage resulting from the oil spill. Rec. Doc. 6418. A final fairness hearing is scheduled for November 8, 2012. In the interim, the Court directed the parties to file motions addressing the viability of three types of claims outside the proposed settlement: the “Pure Stigma,” “BP Dealer,” and “Recreation Claims.” Rec. Doc. 6657. BP, Cameron, Halliburton, Transocean, and M-I moved to dismiss these claims under Fed.R.Civ.P. 12(b)(6). The PSC filed oppositions to these motions. Additionally, the plaintiffs in member case 11-956, Sellno v. BP Exploration & Production, Inc. (“Sellno Plaintiffs”), filed an opposition to the motions targeting the Pure Stigma and Recreation Claims. The plaintiffs in member case 10-4573, Tobatex, Inc. v. BP, p.l.c. (“Tobatex”), filed an opposition to the motions targeting the BP Dealer Claims.

II. LEGAL STANDARD

A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). A defendant may move to dismiss a claim for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). To avoid dismissal, a complaint must plead enough facts to “ ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 547, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A claim is facially plausible when the factual allegations allow the court to “draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. “The plausibility standard is not akin to a ‘probability requirement,’ but it asks for [813]*813more than a sheer possibility that a defendant has acted unlawfully.” Id. A court must accept all well-pleaded facts as true and must draw all reasonable inferences in favor of the plaintiff. Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 232-33 (5th Cir.2009); Baker v. Putnal, 75 F.3d 190, 196 (5th Cir.1996). The court is not, however, bound to accept as true legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.

III. PURE STIGMA CLAIMS

The Court’s Order directing the parties to file the instant motions described the “Pure Stigma Claims” as “claims by or on behalf of owners, lessors, and lessees of real property that they have suffered damages resulting from the taint of their property caused by the oil spill, although no oil or other contaminant physically touched the property.” Rec. Doc. 6657 (emphasis added). In light of the briefing submitted, the Court clarifies that “Pure Stigma Claims” means claims alleging a reduction in the value of real property caused by the oil spill or other contaminant even though (1) the property was not physically touched by oil and (2) the property was not sold. Furthermore, “Pure Stigma Claims” do not include claims by a person who earns a living selling property, such as a real estate agent. See infra note 6 and related text.

For illustrative purposes, the following Short-Form Joinders3 reflect Pure Stigma Claims:

Mrs. Linda Hall (“Plaintiff’) owns a condominium at the Phoenix VIII located ... in Orange Beach, Alabama (residential). Plaintiff has experienced a diminution on the value of her property because of the oil spill. No known physical damage at this time.

Short-Form Joinder of Linda Hall, C.A. 10-8888, Rec. Docs. 245 (parentheticals appear in original).

My claim is for loss of value of my residence ... in Orange Beach, Al. No damage occurred to the property as a result of the spill. I had my property appraised in December 2005 @ $975,000. Another appraisal in December 2010 resulted in $470,000.

ShorL-Form Joinder of Philip Michael Reid, C.A. 10-8888, Rec. Doc.

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In re Oil Spill by the Oil Rig "Deepwater Horizon", 902 F. Supp. 2d 808, 2012 WL 4610381, 2012 U.S. Dist. LEXIS 141546 (E.D. La. 2012).

902 F. Supp. 2d 808 (In re Oil Spill by the Oil Rig "Deepwater Horizon") — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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