D & J Investments of Cenla L L C v. Baker Hughes a G E Co L L C

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF LOUISIANA

ALEXANDRIA DIVISION

D&J INVESTMENTS OF CENLA, CIVIL DOCKET NO. 1:20-CV-01174

LLC, ET AL

VERSUS JUDGE DAVID C. JOSEPH

BAKER HUGHES A GE COMPANY, MAGISTRATE JUDGE JOSEPH H.L.

LLC, ET AL PEREZ-MONTES

MEMORANDUM ORDER AND INJUCTION

Before the Court is a CONSOLIDATED MOTION FOR INJUNCTION AGAINST STATE

COURT PROCEEDINGS AND MOTION TO ENTER PARTIAL FINAL JUDGMENT UNDER RULE

54(B) (collectively, the “Motions”) filed by Defendant, Halliburton Energy Services,

Inc. (“Halliburton”). [Doc. 106]. Defendants Stantec Consulting Services, Inc.

(“Stantec”), GHD Services, Inc. (“GHD”), and Dresser, LLC; Dresser RE, LLC; Baker

Hughes, a GE Company, LLC (now known as Baker Hughes Holdings LLC); Baker

Hughes Energy Services, LLC; and GE Oil & Gas, LLC (now known as Baker Hughes

Energy Services, LLC) (collectively, “Dresser”) have joined in Halliburton’s Motions.

[Docs. 111, 113, 115]. The Court heard oral argument on the Motions on July 1, 2021.

For the following reasons, the Motions are GRANTED.

FACTUAL AND PROCEDURAL HISTORY

This litigation arises from alleged property damage and personal injury

sustained by landowners near a now-closed industrial valve manufacturing facility

in Pineville, Louisiana (the “Dresser Facility”) stemming from contamination caused

by its operations. [Docs. 1-1, 105]. In sum, Plaintiffs contend that for the

approximately 50 years during which the Dresser Facility was operational, the

company improperly disposed of solvents, cutting oils, acids, and caustics – thereby

causing groundwater and soil contamination to Plaintiffs’ respective properties. [Id.].

A general chronology of the events prefacing Plaintiffs’ discovery of their

potential claims is as follows. In late 2011, Dresser discovered elevated levels of

hydrocarbons (“TPH”) in the groundwater adjacent to the Dresser Facility and

notified the Louisiana Department of Environmental Quality (“DEQ”) in early 2012.

[Docs. 1-1, 33-1]. In response to this notification, the DEQ instructed Dresser to

submit an investigation work plan in compliance with the DEQ’s Risk

Evaluation/Corrective Action Program (“RECAP”). [Docs. 1-1, 33-2]. The DEQ

subsequently accepted Dresser’s proposed work plan and directed Dresser to initiate

an investigation into the scope and nature of the potential contamination in

accordance with the RECAP plan’s specifications. [Docs. 1-1, 33-5].

Based on Dresser’s preliminary findings, the geographical scope of the

investigation was later broadened to a larger area that may have been impacted by

contamination. [Id.]. In light of this expanded scope, Dresser submitted a revised

investigation work plan and continued to comply with the DEQ’s instructions and

proposals over the next several years. [Docs. 1-1, 33-6]. On January 8, 2020, the DEQ

notified property owners and residents in affected areas of the groundwater and soil

contamination emanating from the Dresser Facility. [Docs. 1-1, 33-9]. Generally, the

DEQ’s notice explained that Dresser, as owner of the facility, bears the responsibility

of investigating the contamination, described the results of Dresser’s preliminary

investigations, and outlined Dresser’s proposed remediation process. [Id.].

I. The Lawsuit

On July 30, 2020, Plaintiffs filed the instant matter (the “Lawsuit”) in the 35th

Judicial District Court, Grant Parish, Louisiana (“35th JDC”) against nine

defendants: (i) Baker Hughes, a GE Company; (ii) Baker Hughes Energy Services

LLC; (iii) Dresser, Inc.; (iv) Dresser RE, LLC; (v) GE Oil & Gas, LLC; (vi) Halliburton;

(vii) GHD; (viii) Stantec; and (ix) the DEQ.1 [Doc. 1-1]. The action was removed to

this Court on September 10, 2020, based on diversity subject matter jurisdiction

under 28 U.S.C. § 1332. [Doc. 1].

Plaintiffs subsequently filed a Motion for Remand, arguing that the presence

of the DEQ in the litigation precludes federal diversity jurisdiction, among other

reasons. [Doc. 21]. See Allen v. C & H Distributors, L.L.C., 813 F.3d 566, 571 (5th Cir.

2015) (“Ordinarily ‘[i]n an action where a state is a party, there can be no federal

jurisdiction on the basis of diversity of citizenship because a state is not a citizen for

purposes of diversity jurisdiction.’ ”). Defendants responded to the Motion for

Remand,2 urging that the Court maintain diversity jurisdiction because Plaintiffs

had fraudulently joined the DEQ as a defendant. [Docs. 33, 34, 35].

In its Memorandum Ruling issued on November 18, 2020 (the “Nov. 18th

Order”), the Court agreed with Defendants that the Plaintiffs had fraudulently joined

the DEQ as a defendant. [Doc. 49]. In reaching its conclusion, the Court conducted a

1 The DEQ is an agency of the State of Louisiana and, thus, an “arm of the state” for

purposes of the Court’s analysis. See generally Corn v. Mississippi Dep't of Pub. Safety, 954

F.3d 268, 273 (5th Cir. 2020).

2 The DEQ never made an appearance in this litigation and, as such, did not join in

Defendants’ Response to the Motion for Remand.

fraudulent joinder analysis – therein employing a Federal Rule of Civil Procedure

12(b) inquiry into whether the “complaint…contain[s] sufficient factual matter,

accepted as true, to state a claim to relief that is plausible on its face.”3 See Waste

Mgmt., Inc. v. AIG Specialty Ins. Co., 974 F.3d 528, 533 (5th Cir. 2020) (quoting

Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)).

The Court ultimately concluded that Plaintiffs failed to state a claim for which

relief could be granted against the DEQ, holding, in essence, that: (i) there is no

cognizable cause of action under Louisiana law against the DEQ for contamination

caused by private industry and (ii) Louisiana tort law does not create a “specific duty

on the part of the DEQ to inform [landowners] of reported contamination within a

particular timeframe or to otherwise oversee remediation in any particular manner.”

[Id.]. Instead, the Court found that Louisiana’s statutory scheme allows for a party

seeking to challenge DEQ action or inaction to pursue recourse through certain

administrative procedures set forth in Louisiana Revised Statutes 30:2050.1. [Id.].4

3 “A non-diverse defendant is improperly joined if there was actual fraud in the pleading

of jurisdictional facts or the plaintiff cannot establish a cause of action against the non-

diverse defendant.” Waste Mgmt., Inc. v. AIG Specialty Ins. Co., 974 F.3d 528, 533 (5th Cir.

2020). This case involves the latter form of fraudulent joinder, as Defendants did not allege

actual fraud in the pleadings.

4 The Court acknowledges that its holding resolved a matter of first impression in this

District and that the underlying legal issues have yet to be squarely addressed by the

Louisiana Supreme Court or the United States Fifth Circuit Court of Appeals. This holding,

however, is in accord with the context of Louisiana's statutory scheme establishing the DEQ,

the plain text of Louisiana Revised Statutes § 30:2271(A)(4) (stating, in relevant part, that

“[t]he state cannot and should not bear the costs associated with a private profit making

venture”), as well as similar holdings by courts in the Eastern District of Louisiana and the

Middle District of Louisiana. See, Butler v. Denka Performance Elastomer LLC, CV 18-6685,

2019 WL 1160814, at *6 (E.D. La. Mar. 13, 2019), appeal dismissed, 806 Fed. App’x. 271 (5th

Cir. 2020) (“To seek damages from the state for exposure to emissions from a private

defendant's manufacturing facility ventures into absurdity."); Landry v. Laney Directional

Drilling Co., CIV.A. 09-615-JVPSCR, 2009 WL 3833831, at *4 (M.D. La. Nov. 16, 2009)

Because Plaintiffs failed to establish a cognizable basis of recovery against the

DEQ, the Court dismissed the DEQ from the Lawsuit without prejudice.5 [Id.]. See

Flagg v. Stryker Corp., 819 F.3d 132, 136 (5th Cir. 2016). Finding that complete

diversity existed among the remaining properly joined parties, the Court denied the

Motion for Remand. [Id.].

The Lawsuit is one of twelve related cases pending before the Court.6

Currently, all parties in the twelve related cases are engaged in a pre-certification

discovery period in accordance with this Court’s Order [Doc. 90] to explore the

potential for class certification. As of this filing, the DEQ remains a defendant in four

of the pending related matters.

(stating that “[i]mposing a duty on DEQ to bear the cost of testing and remediating sites upon

which material has been allegedly deposited from a private drilling company would clearly

be contrary to the policy set forth by the statute” where the plaintiffs sued the DEQ for

negligently testing hazardous material and failing to properly remediate it).

5 The Court originally dismissed the claims against the DEQ with prejudice. [Doc. 49].

However, upon reconsideration, the Court amended its Nov. 18th Order to dismiss the DEQ

without prejudice. See Int'l Energy Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd., 818

F.3d 193, 210 (5th Cir. 2016) (“[T]he only ground for dismissing any improperly joined,

nondiverse party is lack of subject matter jurisdiction …. Therefore, the dismissal of a

nondiverse party over whom the court does not have jurisdiction must be a dismissal without

prejudice in every instance.”).

6 See Alexander v. Dresser, LLC, No. 1:21-cv-00161-DCJ-JPM (W.D. La. Dec. 30, 2020);

Barnes v. Dresser, LLC, No. 1:21-cv-00024-DCJ-JPM (W.D. La. Jan. 6, 2021); Barrett v.

Dresser, LLC, No. 1:20-cv-01346-DCJ-JPM (W.D. La. Oct. 16, 2021); Cook v. Dresser, LLC,

No. 1:21-cv-00696-DDD-JPM (W.D. La. March 1, 2021); D&J Investments of Cenla, LLC v.

Baker Hughes, a GE Co., LLC, No. 1:20-cv-01174-DCJ-JPM (W.D. La. July 31, 2020);

Epperson v. Dresser, LLC, No. 1:21-cv-00155-DCJ-JPM (W.D. La. Dec. 30, 2020); Hyatt v.

Baker Hughes Holdings LLC, No. 1:20-cv-01460-DCJ-JPM (W.D. La. Sept. 25, 2020); Jacques

v. Baker Hughes, a GE Co., LLC, No. 1:21-cv-00315-DCJ-JPM (W.D. La. Jan. 7, 2021);

LeBlanc v. Baker Hughes, a GE Co., LLC, No. 1:21-cv-00142-DCJ-JPM (Dec. 30, 2020); Perry

v. Baker Hughes, a GE Co., LLC, No. 1:20-cv-01293-DCJ-JPM (W.D. La. Aug. 21, 2020);

Stalnaker v. Baker Hughes, a GE Co., LLC, No. 1:20-cv-01292-DCJ-JPM (W.D. La. Aug. 4,

2020); Wahlder v. Baker Hughes, Inc., No. 1:20-cv-00631-DCJ-JPM (May 8, 2020).

II. The State Court Declaratory Judgment Action

On March 22, 2021, Michael Guillory (“Guillory”) – a plaintiff in the Lawsuit –

filed a Petition for Declaratory Judgment (the “Declaratory Judgment Action”)

against the DEQ in the 19th Judicial District Court, Parish of East Baton Rouge, State

of Louisiana (“19th JDC”),7 to collaterally challenge the legal conclusions underlying

this Court’s dismissal of the DEQ in its Nov. 18th Order.8 [Doc. 106-2]. In the

Declaratory Judgment Action, Guillory requests that the state court grant a

declaratory judgment against the DEQ stating that: (i) the DEQ “owes a duty to

provide timely notice to [Guillory] and similarly situated members of the public likely

to be adversely affected by contamination that poses a significant risk of adverse

health effects” and (ii) Guillory “has a cause of action against [DEQ] arising from its

failure to comply with the provisions of La. Admin Code. tit. 33, Pt I, §§ 101-109.”

[Doc. 125-1, Plaintiff’s Exhibit 1]. The cited sections of the Louisiana Administrative

Code, essentially, delineate the procedures established by the DEQ for notifying the

public of contamination. See La. Admin Code. tit. 33, Pt I, §§ 101-109.

On May 26, 2021, the DEQ filed peremptory exceptions of no cause of action

and lack of subject matter jurisdiction and, alternatively, a motion to stay pending

7 The Declaratory Judgment Action is docket number C-705981 in the 19th JDC.

8 The Petition for Declaratory Judgment was amended on April 21, 2021, to: (i) add

Patrick Keith (“Keith”) as a plaintiff; (ii) name the Louisiana Department of Natural

Resources (“DNR”) as a defendant; and (iii) request the court to grant a declaratory judgment

declaring that the DNR owes a duty to timely notify Keith and similarly situated members

of the public of contamination posing a significant risk of adverse health effects. [Doc. 125-1,

Plaintiff’s Exhibit 1]. As Keith’s claims against the DNR are stated separately from Guillory’s

claims against the DEQ, the Court’s injunction stated herein is applicable only to Guillory’s

claims against the DEQ.

the outcome of the Lawsuit. [Doc. 127-1 p. 109].9 A hearing in the 19th JDC on the

two exceptions and motion to stay is currently set for August 16, 2021. [Id. p. 111].

III. The Instant Consolidated Motion for Injunction Against State

Court Proceedings and Motion to Enter Partial Final Judgment

Under Rule 54(b)

In response to the Declaratory Judgment Action brought in the 19th JDC,

Halliburton filed the subject CONSOLIDATED MOTION FOR INJUNCTION AGAINST STATE

COURT PROCEEDINGS AND MOTION TO ENTER PARTIAL FINAL JUDGMENT UNDER RULE

54(B) on May 21, 2021, requesting the Court to: (i) enjoin the Declaratory Judgment

Action and (ii) certify the Court’s dismissal of the DEQ in the Nov. 18th Order as a

final judgment. [Doc. 106]. Plaintiffs opposed the Motions on June 9, 2021 [Doc. 118],

to which Halliburton replied on June 14, 2021 [Doc. 120]. Following the hearing on

the Motions, the Court ordered the parties to submit supplemental briefing on the

status and potential implications of the Declaratory Judgment Action [Docs. 126, 128]

and took the Motions under advisement.

The Motions allege that Guillory’s Declaratory Judgment Action is an attempt

to re-litigate issues already decided by the Court in its Nov. 18th Order; specifically,

the Court’s holding that Louisiana tort law does not provide a cause of action against

the DEQ for contamination caused by private industry, nor does it create a specific

duty on the part of the DEQ to inform landowners of reported contamination within

a particular timeframe or to otherwise oversee remediation in a particular manner.

9 A peremptory exception of no cause of action under the Louisiana Code of Civil

Procedure is the functional equivalent of a Rule 12(b)(6) motion to dismiss under the Federal

Rules of Civil Procedure. Resolution Tr. Corp. v. U.S. Fid. & Guar. Co., 27 F.3d 122, 125 (5th

Cir. 1994).

[Doc. 106-1].10 Accordingly, the movants suggest that Guillory’s state court filing is

an inappropriate collateral attack on the Court’s ruling and that the Court should

therefore enjoin the Declaratory Judgment Action based on the doctrine of collateral

estoppel. Halliburton further requests the Court to grant a partial final judgment

under Rule 54(b) to create an avenue for Plaintiffs to immediately appeal the

dismissal of the DEQ in the Nov. 18th Order. [Id.]. Because under these facts

Defendants’ request for an injunction is dependent, in part, on the existence of a final

judgment, the Court will first address the Rule 54(b) motion.

DISCUSSION

I. Motion to Enter Partial Final Judgment Under Rule 54(b)

a. Legal Standard

28 U.S.C. § 1291 provides that courts of appeals may review only “final

decisions” of the district courts. Typically, “in a suit against multiple defendants,

there is no final decision as to one defendant until there is a final decision as to all

defendants.” Williams v. Seidenbach, 958 F.3d 341, 343 (5th Cir. 2020). Nevertheless,

Federal Rule of Civil Procedure 54(b) allows a district court to certify an otherwise

non-final judgment as a final, appealable judgment for purposes of § 1291, stating:

When an action presents more than one claim for relief—whether as a

claim, counterclaim, crossclaim, or third-party claim—or when multiple

parties are involved, the court may direct entry of a final judgment as to

10 The Court notes that while the Louisiana Administrative Code does set forth

timeframes for public notification, the application of these timeframes to specific instances

of contamination is left solely to the discretion of the DEQ. Specifically, the relevant

administrative provision provides that public notification of contamination is to be issued

when “reasonably determined by [the DEQ] to be appropriate in accordance with the

considerations identified in this Chapter…to persons whom the [DEQ] reasonably

determines are likely to be adversely affected by the release [of hazardous substances or

pollutants].” La. Admin Code. tit. 33, Pt I, § 109.

one or more, but fewer than all, claims or parties only if the court

expressly determines that there is no just reason for delay. Otherwise,

any order or other decision, however designated, that adjudicates fewer

than all the claims or the rights and liabilities of fewer than all the

parties does not end the action as to any of the claims or parties and may

be revised at any time before the entry of a judgment adjudicating all

the claims and all the parties' rights and liabilities.

Thus, “Rule 54(b) authorizes the district court to make immediately appealable a

judgment that disposes, with finality, of one or more (but not all) claims, even though

other claims remain pending in the district court so that the suit as a whole has not

been finally disposed of by that court.” Williams, 958 F.3d at 348.

Rule 54(b) “reflects a balancing of two policies: avoiding the ‘danger of hardship

or injustice through delay which would be alleviated by immediate appeal’ and

‘avoid[ing] piecemeal appeals.’ ” Eldredge v. Martin Marietta Corp., 207 F.3d 737, 740

(5th Cir. 2000). Certification under Rule 54(b) is reserved for the sound discretion of

the district judge and is reviewed under an abuse of discretion standard. F.D.I.C. v.

McFarland, 05-30377, 2008 WL 162882, at *2 (5th Cir. Jan. 16, 2008).

b. Law and Analysis

Both Plaintiffs and Halliburton agree that the Court’s dismissal of the DEQ

from the Lawsuit does not constitute a “final decision” under § 1291. Accordingly, the

Nov. 18th Order must be certified, in part, as a final judgment as a prerequisite to the

Fifth Circuit having jurisdiction to review the DEQ’s dismissal. See Williams, 958

F.3d at 343 (“[I]n a suit against multiple defendants, there is no final decision as to

one defendant until there is a final decision as to all defendants” absent a Rule 54(b)

order to the contrary.). Plaintiffs oppose a Rule 54(b) certification, maintaining that

even if they were to appeal the Nov. 18th Order, the Fifth Circuit would still hold the

discretion as to whether to certify the legal issues underlying the DEQ’s dismissal to

the Louisiana Supreme Court. [Doc. 128]. Halliburton counters that a partial Rule

54(b) certification would safeguard the rights of all parties to this litigation and avert

a waste of judicial resources. [Docs. 106-1, 126].

Because the Lawsuit involves multiple parties and claims for relief, the DEQ’s

dismissal may be certified as a final decision under Rule 54(b), provided the Court

expressly determines that there is no just reason for delay. Here, the Court concludes

that there is no just reason for delaying entry of a partial final judgment of the Nov.

18th Order, thereby permitting Plaintiffs to appeal the Court’s holding that the DEQ

was fraudulently joined.

Absent certification, this case will proceed to trial without the DEQ’s presence

as a defendant. A certification of the DEQ’s dismissal as a final judgment avoids the

hardship and injustice of a later remand or retrial if, upon appeal, the DEQ is

ultimately found to have been properly joined as a defendant. See Larroquette v.

Cardinal Health 200, Inc., CIV.A. 04-0117, 2004 WL 3132961, at *1 (E.D. La. Dec.

10, 2004), aff'd, 466 F.3d 373 (5th Cir. 2006) (finding no just reason for delaying entry

of a final judgment against the defendant to allow plaintiff to appeal the court's

decision that the defendant was fraudulently joined “to avoid the hardship and

injustice of a potentially needless retrial if the defendant is found not to have been

fraudulently joined”). Additionally, a Rule 54(b) certification of the DEQ’s dismissal

would not offend the well-settled federal policy against piecemeal appeals because

the Nov. 18th Order completely disposed of Plaintiffs’ claims against the DEQ. See

Tetra Techs., Inc. v. Cont'l Ins. Co., 755 F.3d 222, 230 (5th Cir. 2014) (a court disposes

of a “claim” for Rule 54(b) purposes when it makes an express holding as to liability).

The Court finds it notable that Plaintiffs chose not to move the Court for a Rule

54(b) certification of the DEQ’s dismissal and now oppose Defendants’ motion for

certification. Federal procedural law provides that a party aggrieved by an

unfavorable judgment in this district may seek review in the United States Fifth

Circuit Court of Appeals. The Fifth Circuit may then, in its discretion, choose to

certify any relevant state law issues to the Louisiana Supreme Court. Despite

Plaintiffs’ opposition, given the nature of the Court’s holding in its Nov. 18th Order

and its critical impact on the jurisdiction of this Lawsuit and the numerous related

matters, the Court deems it appropriate to provide Plaintiffs a legitimate avenue to

pursue appellate review of the DEQ’s dismissal without undue interruption of the

progression of this matter. Accordingly, the Court herein enters a final judgment

pursuant to Rule 54(b) as to its dismissal of the DEQ in the Nov. 18th Order.

II. Motion for Injunction Against State Court Proceedings

Next, Defendants urge that the doctrine of collateral estoppel warrants an

injunction of Guillory’s Declaratory Judgment Action in the 19th JDC. In general

terms, Defendants contend that, because Guillory requests that the 19th JDC render

judgment on issues of law that this Court decided in its Nov. 18th Order, Plaintiff

Guillory should be precluded from proceeding in the Declaratory Judgment Action.

For the following reasons, the Court grants the requested injunction based on the

doctrine of collateral estoppel and, as an independent ground, because there is clear

evidence that Plaintiffs’ counsel filed the Declaratory Judgment Action for the

express purpose of subverting this Court’s jurisdiction.

a. Legal Standard

The All Writs Act authorizes federal courts to “issue all writs necessary or

appropriate in aid of their respective jurisdictions and agreeable to the usages and

principles of law.” 28 U.S.C. § 1651. This broad grant of authority is tempered by the

Anti-Injunction Act, which generally prohibits federal court from enjoining state

proceedings unless the injunction falls into one of three exceptions: (i) it is expressly

authorized by an Act of Congress; (ii) it is necessary in aid of jurisdiction; (3) it is

necessary to protect or effectuate judgments. 28 U.S.C. § 2283.

The purpose of the Anti-Injunction Act is to “forestall[] the inevitable friction

between the state and federal courts that ensues from the injunction of state judicial

proceedings by a federal court.” J.R. Clearwater Inc. v. Ashland Chem. Co., 93 F.3d

176, 178 (5th Cir. 1996) (quoting Chick Kam Choo v. Exxon Corp., 486 U.S. 140, 146,

108 S.Ct. 1684, 100 L.Ed.2d 127 (1988)). Consequently, federal courts must be

cautious about infringing on the legitimate exercise of state judicial power. State of

Tex. v. United States, 837 F.2d 184, 186 (5th Cir. 1988). Any doubts concerning the

“propriety of a federal injunction ... should be resolved in favor of permitting the state

courts to proceed...” Aptim Corp. v. McCall, 888 F.3d 129, 143 (5th Cir. 2018).

b. Collateral Estoppel

Halliburton posits that the Court has authority to enjoin the Declaratory

Judgment Action pursuant to the doctrine of collateral estoppel, which falls under

the third exception to the Anti-Injunction Act, commonly referred to as the

“relitigation exception.” The relitigation exception “was designed to permit a federal

court to prevent state litigation of an issue that previously was presented to and

decided by the federal court.” Id. In this regard, the relitigation exception is “founded

in the well-recognized concepts of res judicata and collateral estoppel.” Id. (quoting

Chick Kam Choo, 486 U.S. at 147).11

Collateral estoppel, or “issue preclusion,” precludes “a party from litigating an

issue it previously ‘litigated and lost’ in another action.” Hacienda Records, L.P. v.

Ramos, 718 Fed. App’x. 223, 228 (5th Cir. 2018) (citing Parklane Hosiery Co., Inc. v.

Shore, 439 U.S. 322, 327, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979)); Duffy & McGovern

Accommodation Servs. v. QCI Marine Offshore, Inc., 448 F.3d 825, 829 (5th Cir. 2006).

“Moreover, the doctrine of collateral estoppel applies when a ‘previously litigated

issue of law or fact’ is: (i) ‘identical to the present issue,’ (ii) ‘actually litigated,’ (3)

‘necessary to a final judgment,’ and (4) ‘reviewed under the same standard as the

present issue.’ ” City of Alexandria v. Davidson, CIV.A. 14-0723, 2014 WL 2891438,

at *4 (W.D. La. June 25, 2014) (quoting Duffy, 448 F.3d at 830).

Plaintiffs counter that an injunction of the Declaratory Judgment Action based

on collateral estoppel is not appropriate, contending that: (i) the elements of collateral

estoppel are not met under these facts and (ii) collateral estoppel does not apply to

pure questions of law. The Court addresses both arguments in turn.

11 Here, the doctrine of res judicata does not apply because the Court’s Nov. 18th Order

was jurisdictional and, accordingly, did not render a final judgment on the merits of the

DEQ’s dismissal. See Vines v. Univ. of Louisiana at Monroe, 398 F.3d 700, 705 (5th Cir. 2005)

(among other prerequisites, “the prior action must have concluded with a final judgment on

the merits” in order for the relitigation exception under res judicata to apply).

i. Elements of Collateral Estoppel

Plaintiffs’ principal argument against the application of collateral estoppel to

these facts focuses on the third element, or whether the issue of law is “necessary to

a final judgment.” See id. Because the DEQ’s dismissal is not, to date, appealable as

of right, Plaintiffs argue that the two subject issues of law decided by the Court in

the Nov. 18th Order were not necessary to a final judgment. See Harvey Specialty &

Supply, Inc. v. Anson Flowline Equip. Inc., 434 F.3d 320, 323–24 (5th Cir. 2005) (“[A]n

order that ‘is not a final judgment, and therefore is not appealable as a matter of right

... lacks sufficient finality to be entitled to preclusive effect’ under the relitigation

exception.”) (quoting J.R. Clearwater Inc. v. Ashland Chem. Co., 93 F.3d 176, 179 (5th

Cir. 1996)). Thus, Plaintiffs maintain that the third element fails because the two

relevant issues decided in the Nov. 18th Order were interlocutory in nature.

Because, as discussed above, the Count contemporaneously herewith certifies

the Nov. 18th Order under Rule 54(b) as to its dismissal of the DEQ, the third element

of collateral estoppel is met. See Williams v. Seidenbach, 958 F.3d 341, 348 (5th Cir.

2020) (“Rule 54(b) authorizes the district court to make immediately appealable a

judgment that disposes, with finality, of one or more (but not all) claims, even though

other claims remain pending in the district court so that the suit as a whole has not

been finally disposed of by that court.”).

The Court finds that the remainder of the collateral estoppel elements are

likewise satisfied. As to the first element, the Court held in the Nov. 18th Order that

there is no cognizable cause of action under Louisiana law against the DEQ for

contamination caused by private industry, nor does Louisiana tort law create a duty

on the part of the DEQ to notify landowners within a particular timeframe or oversee

remediation in a particular manner. [Doc. 49]. In the Declaratory Judgment Action,

Guillory requests the 19th JDC to make the following two declarations: (i) the DEQ

“owes a duty to provide timely notice to [Guillory] and similarly situated members of

the public likely to be adversely affected by contamination that poses a significant

risk of adverse health effects” and (ii) Guillory “has a cause of action against [DEQ]

arising from its failure to comply with the provisions of La. Admin Code. Tit. 33, Pt

I, §§ 101-109.” [Doc. 125-1, Plaintiff’s Exhibit 1]. Because the two issues of law raised

by Guillory in the Declaratory Judgment Action are the same as those decided in the

Nov. 18th Order, the first element is met.

With respect to the second element, “[t]he requirement that an issue be

‘actually litigated’ for collateral estoppel purposes simply requires that the issue is

raised, contested by the parties, submitted for determination by the court, and

determined.” In re Keaty, 397 F.3d 264, 272 (5th Cir. 2005). Because the two subject

issues of law were raised, contested, briefed by the parties, and adjudicated by the

Court in the Nov. 18th Order, the second element is likewise satisfied.

Finally, the fourth element is present here because the two issues of law in the

Declaratory Judgment Action are subject to the same legal standard that the Court

applied in the Nov. 18th Order. “A peremptory exception of no cause of action under

the Louisiana Code of Civil Procedure is the equivalent of a Rule 12(b)(6) motion to

dismiss under the Federal Rules of Civil Procedure.” Resolution Tr. Corp. v. U.S. Fid.

& Guar. Co., 27 F.3d 122, 125 (5th Cir. 1994). Therefore, in adjudicating the DEQ’s

peremptory exception of no cause of action, the 19th JDC would look to relevant

Louisiana law and jurisprudence to determine if the Petition for Declaratory

Judgment contains sufficient factual allegations, accepted as true, to state a plausible

cause of action – the exact exercise the Court undertook in employing its Rule 12(b)(6)

analysis in the Nov. 18th Order. See Lowther v. Town of Bastrop, 2020-01231, p. 2 (La.

5/13/21) (“An exception of no cause of action tests the legal sufficiency of the petition

by determining whether the law affords a remedy on the facts alleged…All well-

pleaded allegations of fact are accepted as true and correct…”) (internal citations

omitted).

Accordingly, the Court concludes that the relitigation exception to the Anti-

Injunction Act is applicable under these circumstances. In order to protect and

effectuate its judgment dismissing the DEQ from the Lawsuit, an injunction of

Guillory’s claims against the DEQ in the Declaratory Judgment Action is warranted.

ii. Application of Collateral Estoppel to Pure Questions of Law

Plaintiffs also argue that collateral estoppel does not apply to pure questions

of law such as those decided in the Nov. 18th Order and now raised in the Declaratory

Judgment Action. Because the Court rendered judgment on the subject issues of law

for jurisdictional purposes, rather than to the merits of Plaintiffs’ claims, Plaintiffs

contend that collateral estoppel cannot serve as a ground for the injunctive relief

sought.12

12 In addition to this argument, Plaintiffs also maintain that the Eleventh Amendment

bars the application of issue preclusion. [Docs. 118, 128]. However, Plaintiffs cite no direct

authority for this proposition nor does the Court find any support for this assertion.

In support of this position, Plaintiffs rely on part of a footnote in Gruver v.

Louisiana Board of Supervisors for Louisiana State University Agricultural and

Mechanical College, which states that “a reason why issue preclusion does not

typically apply to pure questions of law is that the more flexible doctrine of stare

decisis provides enough stability and protection against unnecessary litigation

burdens.” 959 F.3d 178, 182 n. 3 (5th Cir. 2020). Plaintiffs’ citation to this footnote,

however, is misleading.

In Gruver, the defendant, Louisiana State University (LSU), sought to invoke

Eleventh Amendment immunity against the plaintiffs’ Title IX claim. Id. at 180. The

plaintiffs argued that collateral estoppel precluded LSU from raising Eleventh

Amendment immunity as defense because LSU unsuccessfully asserted it in an

unrelated case two decades previously. Id.; see also Pederson v. Louisiana State

University, 213 F.3d 858, 876 (5th Cir. 2000) (holding that LSU waived Eleventh

Amendment immunity by accepting federal funds under Title IX).

The Fifth Circuit addressed the Plaintiffs’ argument in the following footnote

on which Plaintiffs in the Lawsuit rely:

We thus need not address the [plaintiffs’] contention that preclusion

bars LSU from relitigating the Eleventh Amendment issue it lost in

Pederson. While Eleventh Amendment immunity is a jurisdictional

matter, preclusion is not. Indeed, a reason why issue preclusion does not

typically apply to pure questions of law is that the more flexible doctrine

of stare decisis provides enough stability and protection against

unnecessary litigation burdens.

Gruver, 959 F.3d at 182 n. 3 (internal citations omitted). Hence, in general, parties

are free to re-litigate questions of law in subsequent, unrelated lawsuits. However,

the principle of stare decisis alone does not protect against the hardship and injustice

of the same parties relitigating issues of law or fact that have been conclusively

determined between them in a previous proceeding. See Petro-Hunt, L.L.C. v. United

States, 365 F.3d 385, 396 (5th Cir. 2004) (“Collateral estoppel prevents parties from

re-litigating the same issues conclusively determined between them in a previous

action.”).

Unlike the circumstances in Gruver, the Lawsuit and the Declaratory

Judgment Action involve the same parties, claims, and controlling legal principles.

Because the two actions are not unrelated and all components of collateral estoppel

are met, the Court finds that Guillory may be enjoined from re-litigating the issues

of law raised in the Declaratory Judgment Action.

c. Clear Evidence of Plaintiffs’ Intent to Subvert Removal

Though not briefed by the parties, the first exception to the Anti-Injunction

Act, i.e, where the injunction is “expressly authorized by an Act of Congress,” provides

an independent basis for the Court to enjoin the Declaratory Judgment Action.

Section 1446(d) of the general removal statute “has long been recognized as one of the

statutory exceptions to [the Anti–Injunction Act].” Fulford v. Transp. Servs. Co., 412

F.3d 609, 612 (5th Cir. 2005). Pursuant to Section 1446(d), once a case is removed to

federal court, “the State court shall proceed no further unless and until the case is

remanded.” 28 U.S.C. § 1446(d).

Section 1446(d) authorizes a federal court to which a case is removed to stay

all subsequent state court proceedings in the removed suit. Further, “[a]lthough the

removal statute only commands the state court to stay the case that was actually

removed, it has been interpreted to authorize courts to enjoin later filed state cases.”

Ayala v. Gabriel Bldg. Supply, CV 12-577, 2012 WL 12990575, at *3 (E.D. La. Nov.

7, 2012) (quoting Kansas Pub. Emps. Ret. Sys. v. Reimer & Kroger Assocs., Inc., 77

F.3d 1063, 1069 (8th Cir. 1996)). Under Fifth Circuit precedent, “where a district

court finds that a second suit filed in state court is an attempt to subvert the purposes

of the removal statute, it is justified and authorized by [Section 1446(d)] in enjoining

the proceedings in the state court.” Frith v. Blazon-Flexible Flyer, Inc., 512 F.2d 899

(5th Cir. 1975); see also Fulford v. Transp. Servs. Co., 412 F.3d 609 (5th Cir. 2005);

Matthews v. Stolier, CV 13-6638, 2016 WL 4180868 (E.D. La. Aug. 8, 2016).

Here, Plaintiffs’ case was properly removed from state court to federal court on

the basis of diversity jurisdiction. See 28 U.S.C. §§ 1441, 1446; [Doc. 1]. Plaintiffs then

moved to remand the action, which this Court denied based on its determination that

Plaintiffs had fraudulently joined the DEQ as a defendant. [Doc. 49]. In so finding,

the Court analyzed relevant Louisiana law and jurisprudence to determine whether

Plaintiffs maintained a reasonable basis for recovery against the DEQ, concluding:

Plaintiffs fail to demonstrate how these statutory and state

constitutional provisions give rise to a specific duty on the part of the

DEQ to inform them of reported contamination within a particular

timeframe or to otherwise oversee remediation in any particular manner

… Ultimately, the Court concludes that Plaintiffs have not stated a

cognizable claim against the DEQ.

[Doc. 49]. Yet, four months later, Guillory filed the Declaratory Judgment Action

requesting that a different state court issue a declaratory judgment for the purpose

of undermining the express ruling of this Court as to the plausibility of Plaintiffs’

claims against the DEQ.

To their credit, Plaintiffs’ counsel has been transparent with the Court

regarding their purpose in bringing the Declaratory Judgment Action.13 In this

respect, the ultimate objective of this filing is clear: to force the Court to remand the

Lawsuit to state court. In a status conference held on March 24, 2021 with Magistrate

Judge Perez-Montes, counsel stated the following:

We have filed a dec [sic] action in East Baton Rouge Parish against DEQ,

asking the Court to declare that DEQ does in fact have a duty to protect

the public under that regulation. So we anticipate DEQ answering and

filing a summary judgment. We feel the statute and the regulation is

very clear. And then depending on the Court's ruling, if the Court

declares, we will probably be amending DEQ back in and ask Your

Honor to remand us. So I just wanted to inform the Court that that is

occurring.

[Doc. 126-1, March 24, 2021 Joint Status Conference Transcript, 33:23-34:6]

(emphasis added). Thus, should the 19th JDC grant Guillory a favorable judgment,

Plaintiffs’ counsel intends to “amend[] [the] DEQ back in” to the Lawsuit and move

for remand back to the 35th JDC. Moreover, the relief sought by Guillory is

declaratory judgment rather than damages – further underlining that the

Declaratory Judgment Action is targeted at defeating the Lawsuit’s lawful removal

to federal court.

13 Despite their candor, the Court finds it appropriate to formally caution counsel in this

Lawsuit and related matters that any further attempt to improperly undermine the authority

or jurisdiction of this Court may warrant remedial action. The filing of the Declaratory

Judgment Action in the 19th JDC and the related motion practice in this proceeding has been

an inexcusable waste of judicial and litigative resources and runs contrary to the interests of

individual plaintiffs and other landowners near the Dresser facility – each of whom may have

sustained injury resulting from contamination of their respective properties. Specifically, this

exercise has stalled the progression of this case by diverting attention and resources away

from the merits of the Lawsuit and the pre-certification discovery ordered by the Court.

Plaintiffs’ counsel maintains that its intent in filing the Declaratory Judgment

Action is immaterial. In Plaintiffs’ Post-Hearing Brief concerning this Motion,

counsel represents:

Guillory’s motivation in joining the LDEQ in this suit and in filing his

subsequent state court action is irrelevant. This Court either has

jurisdiction, or it does not….In briefing and in memoranda, Guillory has

made no secret of his intent to establish a viable claim against the LDEQ

in his state court proceeding. Obviously, the success of Guillory’s state

court declaratory judgment action will potentially impact this Court’s

jurisdiction.

[Doc. 128]. Thus, the record in this matter reveals that Plaintiffs’ intent in bringing

the Declaratory Judgment Action was an attempt to defeat this Court’s removal

jurisdiction.

Contrary to the contention of Plaintiffs’ counsel in their Post-Hearing Brief, in

this Circuit, a plaintiff’s aim or intent in filing a subsequent state court action

following removal of his prior action is, in fact, of significance to a federal court’s

decision to issue an injunction under the Anti-Injunction Act. See, e.g., Fulford v.

Transp. Servs. Co., 412 F.3d 609, 613 (5th Cir. 2005) (noting the Fifth Circuit’s

holding in a prior case that an injunction was not warranted when “the second suit

was not brought in an attempt to subvert the purposes of the removal statute and was

not aimed at defeating federal jurisdiction”) (emphasis added) (quoting Frith v.

Blazon-Flexible Flyer, Inc., 512 F.2d 899, 900 (5th Cir. 1975)); Matthews v. Stolier,

CV 13-6638, 2016 WL 4180868, at *4 (E.D. La. Aug. 8, 2016) (“[T]he Court finds that

the State Action was filed with the intent of subverting the purpose of the removal

statutes and should be enjoined.”) (emphasis added); Burton v. JPMorgan Chase

Bank, N.A., 3:19-CV-845-KHJ-LRA, 2020 WL 7427724, at *2 (S.D. Miss. Dec. 18,

2020) (injunction of state court proceeding is warranted where there is “clear evidence

that the [p]laintiff fraudulently filed the state court action to circumvent the federal

court's removal jurisdiction.”). As such, Section 1446(d) provides an additional basis

for the Court to enjoin all of Guillory’s claims against the DEQ in the Declaratory

Judgment Action.

Ultimately, a Rule 54(b) certification of the DEQ’s dismissal as well as an

injunction of the Declaratory Judgment Action best serves the interests of all parties

to this litigation. By virtue of the Rule 54(b) partial final judgment, Plaintiffs will

have the opportunity to appeal the Court’s dismissal of the DEQ in the Nov. 18th

Order. Should the Fifth Circuit disagree with the Court’s dismissal of the DEQ, the

Lawsuit may necessarily be remanded to the 35th JDC. Nonetheless, a defendant’s

right to removal must likewise be protected, and the Court’s granting of Halliburton’s

Motions will safeguard Defendants’ right to proceed in federal court. See Smallwood

v. Illinois Cent. R. Co., 385 F.3d 568, 575 (5th Cir. 2004) (“[T]he Federal courts may

and should take such action as will defeat attempts to wrongfully deprive parties

entitled to sue in the Federal courts of the protection of their rights in those

tribunals.”) (quoting Alabama Great S. Ry. Co. v. Thompson, 200 U.S. 206, 218, 26

S.Ct. 161, 50 L.Ed. 441 (1906)). The Court encourages Plaintiffs to take advantage of

the Rule 54(b) certification and appeal the Nov. 18th Order dismissing the DEQ from

the Lawsuit.

For the foregoing reasons, the CONSOLIDATED MOTION FOR INJUNCTION

AGAINST STATE COURT PROCEEDINGS AND MOTION TO ENTER PARTIAL FINAL JUDGMENT

UNDER RULE 54(B) before the Court is GRANTED.

CONCLUSION

Accordingly,

IT IS ORDERED that Halliburton’s Motion to Enter Partial Final Judgment

Under Rule 54(b) [Doc. 106] is GRANTED. The dismissal of the DEQ in the Nov. 18

Order [Doc. 49] is hereby certified as the Court’s Final Judgment as to all Plaintiffs’

claims against the Louisiana Department of Environmental Quality.

IT IS FURTHER ORDERED that Halliburton’s Motion for Injunction Against

State Court Proceedings [Doc. 106] is GRANTED. Plaintiff Michael Guillory is

ENJOINED from prosecuting his lawsuit against the Louisiana Department of

Environment Quality filed on March 22, 2021, in the Judicial District Court for

the Parish of East Baton Rouge styled, Michael Guillory v. State of Louisiana,

Through the Department of Environmental Quality, No. C-705981, Section 25.

THUS, DONE AND SIGNED in Chambers on this 11“ day of August 2021.

Chad C Leet

DAVID C. JOSEPH

UNITED STATES DISTRICT JUDGE

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