explaining that the federal officer removal statute "creates federal jurisdiction even over cases brought against private parties [or non-federal entities] if they are sued for conduct they committed under the direction of federal authorities and for which they have a colorable defense under federal law"
How later courts described this case
- explaining that the federal officer removal statute "creates federal jurisdiction even over cases brought against private parties [or non-federal entities] if they are sued for conduct they committed under the direction of federal authorities and for which they have a colorable defense under federal law"
- explaining that the federal defense must simply be "subject to reasonable debate"
- upholding denial of certification on grounds that individualized issues of causation and damages would predominate for class of property owners alleging that construction caused personal injury and property damage
- holding a formulaic approach is not possible in part because plaintiffs sought “damages for emotional distress, which would presumably require testimony from each affected class member”
Written by the judges who cited it.
The opinion
Case: 15-30709 Document: 00513591457 Page: 1 Date Filed: 07/13/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
July 13, 2016
No. 15-30709
Lyle W. Cayce
Clerk
RONDA CRUTCHFIELD, wife of/and; WADE CRUTCHFIELD; AUDREY
HAINES, wife of/and; JOSEPH A. HAINES; MATELLA MOSBY; VELMA B.
RENARD,
Plaintiffs - Appellants
BENJAMIN DIGGINS, SR.; SANDY WHEELER; ADRIANN WHITAKER;
HAROLD WHITAKER; MATTIE WOMBLE,
Appellants
v.
SEWERAGE AND WATER BOARD OF NEW ORLEANS; HILL BROTHERS
CONSTRUCTION COMPANY, INCORPORATED; TRAVELERS
PROPERTY CASUALTY COMPANY OF AMERICA; GRIFFIN
DEWATERING SOUTHWEST, L.L.C.; BLUE IRON FOUNDATION AND
SHORING, L.L.C.; BHATE GEOSCIENCES CORPORATION; LIBERTY
MUTUAL FIRE INSURANCE COMPANY,
Defendants - Appellees
Appeals from the United States District Court
for the Eastern District of Louisiana
Before SMITH, BARKSDALE, and COSTA, Circuit Judges.
GREGG COSTA, Circuit Judge:
Located below sea level, with Lake Pontchartrain to the north and the
Mississippi River to the south, New Orleans is particularly susceptible to
flooding. This case arises from recent efforts to address this intractable
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No. 15-30709
problem. Created twenty years ago, the Southeast Louisiana Urban Flood
Control Project aimed to reduce flooding by improving draining canals,
increasing capacity for pump stations, and constructing new pump stations.
But its efforts at constructing a new canal in New Orleans’s Ninth Ward
resulted in complaints of property damage to surrounding homes. The result
was this lawsuit seeking to certify a class of nearby property owners asserting
claims of damaged property resulting from a variety of construction activities.
The district court denied class certification, holding that the Rule 23
requirements of commonality, predominance, and superiority were lacking,
primarily because of the difficulty of establishing which defendants and which
conduct caused the alleged damages. We consider whether that decision was
an abuse of discretion.
I.
Although dwarfed by the later flooding of Hurricane Katrina, the New
Orleans area experienced a major flood in May 1995 that caused a number of
deaths and more than $3 billion in damage. That reminder of the threat that
flooding poses to southeast Louisiana led Congress to provide increased flood
protection for the region in the Water Resources Development Act of 1996.
That law authorized the Army Corps of Engineers to partner with state and
local agencies to improve drainage and prevent flooding in Orleans, Jefferson,
and St. Tammany Parishes via the Southeast Louisiana Urban Flood Control
Project. Pub. L. No. 104–303, 110 Stat. 3658, § 533.
The complaints that gave rise to this lawsuit are not the only reported
problems with the Project’s drainage improvement efforts. Other construction
projects have resulted in dozens of lawsuits that proceeded as consolidated
actions rather than class actions. See Holzenthal v. Sewerage Water Bd. of New
Orleans, 999 So.2d 1191 (La. App. 4 Cir. 2008) (three consolidated cases);
2
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No. 15-30709
Shimon v. Sewerage and Water Bd. of New Orleans, No. CIV.A.05-1392, 2006
WL 2475309, at *1 (E.D. La. Aug. 24, 2006) (sixty-six consolidated cases).
This case that Plaintiffs want to pursue as a class action involves the
construction of the Dwyer Road Intake Canal, a 7,000-feet-long, 14-to-16-feet-
deep box culvert along Dwyer Road in New Orleans’ Ninth Ward. The Project
required the excavation of 110,000 cubic yards of soil, the erection of a
temporary retaining structure, and significant pile driving. A comprehensive
dewatering effort was also implemented to keep ground and rain water from
filling excavated areas. The project began in September 2008 and took more
than five years to complete.
The named plaintiffs filed this lawsuit in state court in August 2012,
seeking to represent a class of property owners and residents who owned
immovable property or resided within 1,000 feet to the north or south of the
Project. Approximately 1,054 houses are located within this area. Plaintiffs
allege that construction and related activities such as excavation, dewatering,
and pile driving damaged and stigmatized their property and caused them
mental anguish and emotional distress.
The suit alleges state law causes of action for inverse condemnation;
strict liability under Louisiana Civil Code Articles 2317, 2317.1, and 667;
failure to protect from vice, ruin or defect under Civil Code Articles 662, 667,
and 668; negligence; and intentional torts. Plaintiffs originally sued several
defendants but then dismissed all of them except for the Sewerage and Water
Board of New Orleans, which Plaintiffs claim exercised oversight and control
over the Project. Left as the sole defendant, the Board filed a third party
demand against Hill Brothers Construction, the general contractor for the
Project. Hill Brothers removed the suit to federal court under the federal
officer removal statute (28 U.S.C. § 1442(a)(1)) on the ground that its
challenged conduct related to work it performed on a Corps of Engineers
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No. 15-30709
contract. Hill Brothers also brought its subcontractors, Blue Iron Foundation
and Shoring, L.L.C., Griffin Dewatering Southwest, L.L.C., and Bhate
Geosciences Corporation into the case as third party defendants. 1 Plaintiffs
later named Hill Brothers, its subcontractors, and its insurers as direct
defendants in an amended pleading.
Plaintiffs sought remand to state court, arguing that Hill Brothers did
not comply with the specifications of the Corps contract and thus could not
establish the government contractor defense. The district court disagreed and
kept the case in federal court. Plaintiffs tried to appeal that jurisdictional
ruling by invoking a provision in the Class Action Fairness Act that grants
courts of appeals the discretion to engage in interlocutory review of remand
rulings. 28 U.S.C. § 1453(c). But we dismissed the appeal, concluding that
there was no authority for interlocutory review because removal was based on
the federal officer removal statute rather than the statute governing removal
of class actions. Crutchfield v. Sewerage & Water Bd. of New Orleans, 603 F.
App’x 350 (5th Cir. 2015).
Plaintiffs then moved to certify a class. The district court denied
Plaintiffs’ motion, concluding that they failed to satisfy the requirements of
commonality under Rule 23(a) and predominance and superiority under Rule
23(b)(3). We then granted Plaintiffs’ request for an interlocutory appeal
pursuant to Rule 23(f).
II.
Plaintiffs do not attempt to revive their challenge to federal jurisdiction
that we previously held we did not have jurisdiction to consider. But with the
1 Blue Iron installed and extracted metal sheet pilings on the Project as part of the
temporary restraining structure; Griffin designed, installed, and maintained the dewatering
system for the Project; and Bhate is alleged to have provided geotechnical services and “aid
in [quality control]” on the Project.
4
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No. 15-30709
Rule 23(f) procedure now giving us appellate jurisdiction over the certification
decision, we may consider sua sponte whether the district court had
jurisdiction over the case that would authorize a certification ruling. See
Giannakos v. M/V Bravo Trader, 762 F.2d 1295, 1297 (5th Cir. 1985) (“United
States District Courts and Courts of Appeals have the responsibility to
consider the question of subject matter jurisdiction sua sponte if it is not raised
by the parties and to dismiss any action if such jurisdiction is lacking.”).
We agree with the district court that jurisdiction exists under the federal
officer removal statute. That statute creates federal jurisdiction even over
cases brought against private parties if they are sued for conduct they
committed under the direction of federal authorities and for which they have a
colorable defense under federal law. See Savoie v. Huntington Ingalls, Inc.,
817 F.3d 457, 460–61 (5th Cir. 2016); Winters v. Diamond Shamrock Chem.
Co., 149 F.3d 387, 397–98 (5th Cir. 1998). The only requirement for federal
officer removal contested in the trial court was whether Hill Brothers (the
removing party) has a colorable argument that it is entitled to the government
contractor defense. That defense provides immunity to contractors for conduct
that complies with the specifications of a federal contract. See Boyle v. United
Techs. Corp., 487 U.S. 500 (1988). As Hill Brothers need prove for
jurisdictional purposes only that its entitlement to the defense is subject to
reasonable debate, Winters, 149 F.3d at 400, our review of the record supports
the district court’s conclusion that the federal officer removal statute applies.
Indeed, whether the contractor defendants are entitled to the immunity is,
according to Plaintiffs, one of the common questions in this case that make
certification appropriate.
III.
We thus turn to the district court’s denial of the motion for class
certification, which we review for abuse of discretion. Allison v. Citgo
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No. 15-30709
Petroleum Corp., 151 F.3d 402, 408 (5th Cir. 1998). “Implicit in this deferential
standard is a recognition of the essentially factual basis of the certification
inquiry and of the district court’s inherent power to manage and control
pending litigation.” Id. And a district court’s expertise in case management
and overseeing trials is particularly useful in making the predominance and
superiority inquiries of Rule 23(b)(3), which require envisioning what a class
trial would look like. See, e.g., Castano v. Am. Tobacco Co., 84 F.3d 734, 740
(5th Cir. 1996).
For all Rule 23 class actions, a party seeking certification must show
that: “(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class; (3) the claims or
defenses of the representative parties are typical of the claims or defenses of
the class; and (4) the representative parties will fairly and adequately protect
the interests of the class.” FED. R. CIV. P. 23(a). The lawsuit must then meet
one of the criteria found in Rule 23(b). FED. R. CIV. P. 23(b). The relevant
provision here is Rule 23(b)(3), which allows a class action to be maintained if
“the court finds that the questions of law or fact common to class members
predominate over any questions affecting only individual members, and that a
class action is superior to other available methods for fairly and efficiently
adjudicating the controversy.” FED. R. CIV. P. 23(b)(3).
Although the district court gave three separate grounds for denying the
motion for class certification (commonality under Rule 23(a); and both
predominance and superiority under Rule 23(b)(3)), it found that the “fatal
defect” was the lack of predominance. We agree that predominance is the most
glaring obstacle to certifying this case, so we address only that ruling in
affirming the district court’s decision.
The predominance requirement “tests whether proposed classes are
sufficiently cohesive to warrant adjudication by representation.” Amchem
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Prods., Inc. v. Windsor, 521 U.S. 591, 623 (1997). This inquiry requires “courts
to . . . careful[ly] scrutiny[ize] the relation between common and individual
questions in a case.” Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1045
(2016). As the Supreme Court recently explained:
[a]n individual question is one where ‘members of a proposed class
will need to present evidence that varies from member to member,’
while a common question is one where ‘the same evidence will
suffice for each member to make a prima facie showing [or] the
issue is susceptible to generalized, class–wide proof.’
Id. (quoting 2 William B. Rubenstein, NEWBERG ON CLASS ACTIONS §4:50, pp.
196–97 (5th ed. 2012)). “When ‘one or more of the central issues in the action
are common to the class and can be said to predominate, the action may be
considered proper under Rule 23(b)(3) even though other important matters
will have to be tried separately, such as damages or some affirmative defenses
peculiar to some individual class members.’” Id. (quoting 7AA Charles Alan
Wright & Arthur R. Miller, FEDERAL PRACTICE AND PROCEDURE § 1778, pp.
123–24 (3d ed. 2005)). At bottom, the inquiry requires the trial court to weigh
common issues against individual ones and determine which category is likely
to be the focus of a trial.
In performing that assessment, the district court did not abuse its
discretion in concluding that individualized questions of causation would be
the central, or predominant, issue when this case is tried. It explained that to
establish causation, class members would have to present individualized
evidence related to the age, size, structure, location, and damage of each
affected property. Indeed, the number of defendants and different conduct
they engaged in demonstrate how individualized this inquiry will be. Plaintiffs
contend that a variety of construction activities, performed by the various
defendants at different times over a five year period, caused their damages.
Examples include the distinct acts of engineering and construction design, pile
7
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driving, dewatering, earth moving, equipment hauling, and debris removal. To
prevail, each plaintiff will need to prove which activities performed by which
defendants caused which damages to a particular property. Repeat that
inquiry for the more than 1,000 houses that would make up the proposed class,
and a “series of mini-trials” would result. See State of Alabama v. Blue Bird
Body Co., Inc., 573 F.2d 309, 328 (5th Cir. 1978).
Looking beyond the allegations to the evidence Plaintiffs hope to use to
establish causation, the district court found even more indications of how
particularized this evidence will be for each property. Plaintiffs’ own experts
acknowledge that not every property responds to vibrations and dewatering in
the same way. For example, a geoprofessional engineer admitted that
vibrations may affect structures within the same neighborhood differently,
depending on the location of the structure, its construction, the code conditions
under which it was built, and even whether the structure is “in tune” with the
frequency of the vibration. Another of their experts opined that the level of
ground and structure vibrations caused by construction activities depends on
several variables including, for example, soil medium, construction method,
and heterogeneity of soil deposits at the site.
Plaintiffs argue, however, that individualized proof of causation is not
required for their pile driving and dewatering claims under Louisiana law.
They cite Lombard v. Sewerage & Water Bd. of New Orleans, 284 So.2d 905
(La. 1973), another case involving claims of property damage related to the
construction of a New Orleans drainage canal. Lombard involved seventeen
consolidated lawsuits with 119 plaintiffs. Id. at 906. Only eight of the 119
plaintiffs testified, but the plaintiffs stipulated that if each plaintiff were called
to testify, their testimony as to causation and damages would be substantially
the same as the eight testifying plaintiffs. Id. at 912. The Supreme Court of
Louisiana found that the plaintiffs’ testimony regarding the condition of their
8
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properties sufficiently established that their damages were caused by the
construction. Id. at 913. Based on Lombard, Plaintiffs argue that their
testimony as to the condition of their property before and after the construction
activities, combined with other data, should allow causation to be determined
on a classwide basis.
But Lombard was not a class action. The eight testifying plaintiffs were
only representing other named parties who had stipulated that their testimony
would be substantially similar; they were not seeking to represent the interests
of hundreds of unnamed parties which gives rise to the due process concerns
that animate Rule 23’s requirements. See Califano v. Yamasaki, 442 U.S. 682,
700–701 (1979).
Moreover, while causation, like most things, may be proved
circumstantially, under the governing Louisiana law “circumstantial evidence
must exclude other reasonable hypotheses with a fair amount of certainty.”
Lombard, 284 So.2d at 913. A number of such other hypotheses exist here and
would have to be considered in determining causation. Another of the
Plaintiffs’ experts acknowledges that many homes in the area had preexisting
damage or “chronic conditions unrelated to construction,” and he admits that
every item on Plaintiffs’ list of alleged damages could be caused by something
other than the canal project. Plaintiffs also testified that some of their homes
were damaged in Hurricane Katrina; one plaintiff did not have a structural
engineer inspect her home’s foundation post-Katrina to ensure it was safe for
rebuilding; and other plaintiffs do not know if the contractors who repaired
their homes were licensed or had the proper permits. The district court was
reasonably concerned that individual questions regarding causation would
predominate even if circumstantial proof were used.
Although the district court called it the “fatal defect,” causation is not
the only individualized issue. Damages is another. Plaintiffs argue that
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damages can be determined using a single formulaic approach, but they have
not provided one. Any such formula would at a minimum need to take account
of the variances in age, size, type, construction, condition, soil composition, and
location of the properties. See Steering Comm. v. Exxon Mobil Corp., 461 F.3d
598, 602 (5th Cir. 2006) (finding that plaintiffs’ damages claims were not
subject to any formulaic calculation because (1) “each . . . plaintiff suffered
different alleged periods and magnitudes of exposure . . . and different alleged
symptoms”; (2) “some [plaintiffs] allege[d] both personal and property injuries
while others allege[d] only one or the other”; and (3) “many plaintiffs
allege[d] . . . emotional and other intangible injuries . . . [which] necessarily
implicates the subjective differences of each plaintiff’s circumstances . . . .”);
Corley v. Orangefield Indep. Sch. Dist., 152 F. App’x 350, 355 (5th Cir. 2005)
(affirming denial of class certification in suit brought by landowners against
electric company for exceeding terms of easements because of the “necessity of
individualized damage calculations” due to differences in the value, character,
and location of the properties). And this just addresses the economic damages.
Plaintiffs also seek damages for emotional distress, which would presumably
require testimony from each affected class member. See Steering Comm., 461
F.3d at 602.
Of course, damages are often an individualized determination and
Plaintiffs correctly note that courts often certify class actions and provide for
bifurcated damages trials after a classwide trial on other issues. See, e.g.,
Watson v. Shell Oil Co., 979 F.2d 1014, 1016–18 (5th Cir. 1992) (affirming
district court’s decision to certify a bifurcated class action in which liability and
punitive damages would be resolved commonly, and injury, causation, and
actual damages would be resolved individually). But even though trial courts
have flexibility in crafting bifurcated proceedings once a case is certified, the
predominance inquiry that is a prerequisite to certification requires assessing
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all the issues in a case—including damages—and deciding whether the
common ones will be more central than the individual ones. Corley, 152 F.
App’x at 355 (“[P]laintiffs must first show that the cause of action, taken as a
whole, satisfies the predominance requirement of Rule 23(b)(3).”). The district
court did not err in concluding that highly individualized issues of both
causation and damages would predominate over any common liability
questions or defenses that might exist.
Plaintiffs nonetheless compare this case to other tort cases in which we
have upheld certification decisions. To be sure, although not the paradigmatic
class action case involving a small amount of damages that makes individual
or consolidated suits impractical, 2 we have upheld certification of class actions
in certain “mass tort” cases. But in addition to the much different procedural
posture in those cases of reviewing whether a district court had abused its
discretion in certifying the class, they involved single episodes of tortious
conduct usually committed by a single defendant. See In re Deepwater Horizon,
739 F.3d 790 (5th Cir. 2014) (affirming approval of settlement class for
explosion at offshore platform); Mullen v. Treasure Chest Casino, LLC, 186
F.3d 620, 626 (5th Cir. 1999) (affirming trial court’s holding that common
issues would predominate because the class members “claim injury from the
same defective ventilation system over the same general period of time”
against a single defendant); Watson, 979 F.2d at 1023 (affirming approval of
2 Indeed, the advisory committee notes to Rule 23 state that “[a] ‘mass accident’
resulting in injuries to numerous persons is ordinarily not appropriate for a class action
because of the likelihood that significant questions, not only of damages but of liability and
defenses of liability, would be present, affecting the individuals in different ways. In these
circumstances an action conducted nominally as a class action would degenerate in practice
into multiple lawsuits separately tried.” See FED. R. CIV. P. 23(b)(3) advisory committee’s
note to 1966 amendment.
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class certification for explosion at refinery). 3 Despite Plaintiffs’
characterization of this case as a similar one involving a “single episode,” the
allegations and evidence demonstrate otherwise. This lawsuit seeks to recover
different damages caused by different acts committed by different defendants
at different times over a five year period. The district court did not abuse its
discretion in concluding that individualized issues of causation and damages
would predominate.
***
The denial of certification is AFFIRMED. The case is remanded, which
will allow the district court to consider how the case of the named plaintiffs
should proceed.
3 The cases from other circuits on which Plaintiffs rely also involve single episodes of
tortious conduct committed by a single defendant. See Gintis v. Bouchard Transp. Co., 596
F.3d 64 (1st Cir. 2010) (vacating and remanding for evaluation of predominance and
superiority requirements in case involving allegations of property damage resulting from an
oil spill); Mejdrech v. Met-Coil Sys. Corp., 319 F.3d 910, 912 (7th Cir. 2003) (affirming class
certification when plaintiffs alleged that a storage tank on the defendant’s property
contaminated soil and groundwater beneath their homes).
12