Gravel2Gavel Construction & Real Estate Law Blog
On May 20, 2016, the U.S. Court of Appeals for the Eighth Circuit, in Ebert, et al., v. General Mills, Inc., reversed the federal district court’s decision to grant class certification in an environmental contamination lawsuit. The district court had found that the requisites of Federal Rule of Civil Procedure 23 had been satisfied with respect to the proposed class of “all persons and non-governmental entities that own residential property within the ‘Class Area.'” The proposed class members were expected to assert five legal claims: (1) violation of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA); (2) common law negligence; (3) private nuisance; (4) willful and wanton misconduct; and (5) violation of the Resource Conservation and Recovery Act (RCRA). The Eight Circuit disagreed with the district courts findings, instead concluding that the proposed class lacks the requisite commonality and cohesiveness to satisfy Rule 23.
General Mills owned and operated an industrial facility in the Minneapolis suburbs (the Como neighborhood) from 1930 to 1977, when the property was sold. From 1947 until 1962, General Mills disposed of thousands of gallons of hazardous substances every year by placing the waste in perforated drums, and then burying the drums on its property. After the enactment of CERCLA in 1980, General Mills entered into a 1984 Consent Order and Remedial Action Plan with the Minnesota Pollution Control Agency (MPCA) to address the presence, if any, of the chemical substance trichloroethylene (TCE) in groundwater below and near the facility. According to the Court, General Mills engaged in groundwater cleanup and remediation efforts in the Como neighborhood for nearly 30 years and, in 2011, in conjunction with the MPCA, began to evaluate the potential for the migration of TCE from shallow groundwater and the adjacent soil. General Mills installed 118 vapor mitigation systems in the neighborhood.
All of the plaintiffs in this lawsuit received these vapor mitigation systems but, nonetheless, filed a putative class action lawsuit seeking property damages (for diminution in value) and injunctive relief under the RCRA, CERCLA, and on common law grounds on behalf of the proposed class. The district court granted the plaintiffs’ request for class certification under Rule 23, and General Mills appealed the ruling. Reviewing the requirements of Rule 23, in particular Rules 23 (b)(2) and (3), the Eighth Circuit generally agreed with General Mills that the “exceedingly complex issues of injury and causation unique to each of the proposed plaintiffs in the class defeat considerations required for class certification.” The Eighth Circuit also stated that “we think it is clear that individual issues predominate the analysis of causation and damages that must be litigated to resolve the plaintiffs’ claims,” and that the “disparate factual circumstances of class members prevent the claims from being cohesive and thus unable to be certified.” The case was remanded and the district court was directed to revisit these issues raised “in conformity with this opinion.”