Veracruz v. BP, P.L.C.

784 F.3d 1019, 2015 WL 1965819
CourtCourt of Appeals for the Fifth Circuit
DecidedMay 1, 2015
DocketNo. 13-31070
StatusPublished
Cited by4 cases

This text of 784 F.3d 1019 (Veracruz v. BP, P.L.C.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Veracruz v. BP, P.L.C., 784 F.3d 1019, 2015 WL 1965819 (5th Cir. 2015).

Opinion

CARL E. STEWART, Chief Judge:

In April 2010, a blowout, explosion, and fire occurred aboard the mobile offshore drilling unit Deepwater Horizon as it was [1022]*1022preparing to temporarily abandon a well 50 miles off the Louisiana coast. Millions of gallons of oil discharged into the Gulf of Mexico before the well was capped nearly three months later.

In September 2010, three Mexican states (Veracruz, Tamaulipas, and Quintana Roo (hereinafter, the “Mexican States” or “Plaintiffs”)) filed substantially similar complaints in the Western District of Texas for damages incurred as a result of the oil spill. After the cases were consolidated in the Eastern District of Louisiana as part of the Deepwater Horizon multidistrict litigation, the district court in September 2013 granted summary judgment to the defendants — BP, Transocean, Halliburton, and Cameron1 — because the Mexican states did not hold a sufficient “proprietary interest” in the allegedly damaged property. The Mexican States have appealed this judgment.

I. Factual and Procedural Background

The Mexican States- each filed suit against BP (well owner, operator, and block lessee), Transocean (owner of the Deepwater Horizon), Halliburton (cement contractor), Anadarko (co-owner and co-lessee with BP), and Cameron (manufacturer of the blowout preventer)2 for damages they allegedly incurred or would sustain as a result of the oil spill. These damages included “monitoring and preparing to respond to the oil spill; contamination and injury to the waters, estuaries, seabed, animals, plants, beaches, shorelines, etc., of the Mexican States; lost taxes, fees, etc., due to reduced fishing activity and fishing-related industries; lost taxes, etc., due to diminished tourism; and the net costs of providing increased public services.” In re Oil Spill, 970 F.Supp.2d 524, 526 (E.D.La.2013). The Mexican States brought claims alleging negligence, gross negligence, negligence per se, violations of the Oil Pollution Act (“OPA”), private nuisance, and public nuisance.

In December , 2011, the district court dismissed the Mexican States’ claim for negligence per se, the OPA claim,3 and the two nuisance claims. The court preserved the negligence and gross negligence claims against the current Defendants “only to the extent there has been a physical injury to a proprietary interest.” In re Oil Spill, 835 F.Supp.2d 175, 182 (E.D.La.2011). Discovery was eventually limited to the [1023]*1023proprietary interest prong,4 and the parties cross-moved for summary judgment.

In September 2013, the district court granted summary judgment to Defendants on the ground that the Mexican States lacked a proprietary interest sufficient to overcome application of the rule, announced in Robins Dry Dock & Repair Co. v. Flint, precluding recovery for economic loss absent a proprietary interest in physically damaged property. See 275 U.S. 303, 307-09, 48 S.Ct. 134, 72 L.Ed. 290 (1927). After conducting an exhaustive inquiry into Mexican law, the court held that the Mexican federal government, rather than the states, is the true owner of the damaged property. In support of this determination, the district court pointed out that the Mexican federal government, in April 2013, brought a fundamentally similar lawsuit. That case is progressing, though no substantive orders have been issued. The court also stated that “it appears that the Mexican States lack legal standing.” In re Oil Spill, 970 F.Supp.2d at 541.

Plaintiffs timely appealed. The issues on appeal are: (1) whether the district court correctly determined that the Robins Dry Dock rule is applicable to the Mexican States’ claims and (2) whether the district court correctly held that the Mexican States lack proprietary interests in the allegedly damaged property sufficient to maintain their claims.

II. Standard of Review

This court reviews a district court’s grant of summary judgment de novo, applying the same standard as the district court and reviewing the facts in the light most favorable to the nonmovants. See Tiblier v. Dlabal, 743 F.3d 1004, 1007 (5th Cir.2014). Summary judgment is proper “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. (“FRCP”) 56(a).

When inquiring into foreign law, courts may consider “any relevant material or source” whether or not presented by the parties. See FRCP 44.1 & advisory committee’s note to 1966 adoption. The determination “must be treated as a ruling on a question of law.” Id. “[Djifferences of opinion among experts on the content, applicability, or interpretation of foreign law do not create a genuine issue as to any material fact.” Access Telecom Inc. v. MCI Telecomms. Corp., 197 F.3d 694, 713 (5th Cir.1999); see also 9A Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 2444 (3d ed.1998).

III. Applicability of Robins Dry Dock

A threshold question is whether Plaintiffs’ claims are even subject to the Robins Dry Dock rule precluding recovery “for economic loss if that loss resulted from physical damage to property in which [the plaintiff has] no proprietary interest.” In re Bertucci Contracting Co., 712 F.3d 245, 246 (5th Cir.2013) (internal quotation marks and citation omitted). This hard-edged, longstanding common law principle has been reaffirmed by an en banc panel of this court. See State of La. ex rel. Guste v. M/V Testbank, 752 F.2d 1019 (5th Cir.1985) (en banc) (denying recovery to a wide variety of plaintiffs — including operators of marinas, cargo terminal operators, wholesale and retail seafood enterprises, among others — who sought damages from shipowners responsible for spilling chemi[1024]*1024cals into a Mississippi River gulf outlet). The rule’s purpose is to limit the “consequences of negligence and exclude indirect economic repercussions, which can be widespread and open-ended.” Catalyst Old River Hydroelectric Ltd. v. Ingram Barge Co., 639 F.3d 207, 210 (5th Cir.2011).

The Mexican States contend that the Robins Dry Dock rule is cabined to civil negligence and other unintentional conduct. They argue that Robins Dry Dock is inapplicable because both BP and Trans-ocean pled guilty to criminal conduct arising from the Deepwater Horizon disaster.

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784 F.3d 1019, 2015 WL 1965819, Counsel Stack Legal Research, https://law.counselstack.com/opinion/veracruz-v-bp-plc-ca5-2015.