Appendix — Cudahy Co. v. Miller

88-1186 | FILED

JAN 18 1989

_ JOSEPH F. SPANIOL, JR,

SterkK

IN THE

Supreme Court of the United States

OCTOBER TERM, 1988

GENERAL HOST CORPORATION and CUDAHY COMPANY,

Petitioners,

Vv.

CECIL W. MILLER, et al.,

Respondents.

APPENDIX TO

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

JOHN LOGAN O’DONNELL REX E. LEE *

E. SHERRELL ANDREWS GERALD A. AMBROSE

OLWINE, CONNELLY, CHASE, CARTER G. PHILLIPS

O’DONNELL & WEYHER MARK D. HOPSON

299 Park Avenue SIDLEY & AUSTIN

New York, New York 10171 1722 Eye Street, N.W.

(212) 207-1800 Washington, D.C. 20006

THOMAS D. KITCH (202) 429-4000

RON CAMPBELL ROBERT G. KUHBACH

FLEESON, GOOING, General Host Corporation

COULSON & KITCH 22 Gate House Road

125 N. Market Stamford, Conn. 06902

16th Floor (203) 357-9900

Wichita, Kansas 67201

(316) 267-7361

Counsel for Petitioners

January 18, 1989 * Counsel of Record

WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

INDEX TO APPENDICES

Appendix A, Opinion of the United States Court of

Appeals for the Tenth Circuit, filed Sept. 28, 1988......

Appendix B, Opinion of the United States District

Court (D. Kansas), Denying Petitioner’s Post-Trial

Motions, Rejecting Remedial Action Plans and Im-

posing Punitive Damages, March 3, 1987

Appendix C, Opinion of the United States Court of

Appeals for the Tenth Circuit, Dismissing Petition-

er’s Appeal From 1984 District Court Judgment,

Ce. a akc ei eae es

Appendix D, Opinion of the United States District

Court (D. Kansas), Holding Petitioners Liable and

Imposing Compensatory and Punitive Damages,

| Re Se Cickgsianinscceiccsab lenin canaaaaeddaciapenstiat tbe

Appendix E, Opinion of the United States District

Court (D. Kansas), Denying General Host’s Motion

For Partial Summary Judgment, June 21, 1983

Appendix F, Order of the United States Court of Ap-

peals for the Tenth Circuit, Denying Petition for Re-

hearing, Nov. 1, 1988 ............

Page

111]

116

la

APPENDIX A

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

Nos. 87-1502

87-2283

CeEcIL W. MILLER and MILDRED FE. MILLER, Joint Ten-

ants; MARGARET L. BIRCHENOUGH 'TESTAMENTARY

TRUST, DONALD L. BIRCHENOUGH, ANSEL TOBIAS and

WALTER WRIGHT, Trustees; RUTH M. HOLLINGER, In-

dividually and as Joint Tenant with DELBERT HOLLIN-

GER; JOHN E. EDWARDS and KERMIT C. EDWARDS,

Joint Tenants; HOMER SHARPE; CECIL M. TOBIAS and

FRANCES TOBIAS, Joint Tenants; PAUL F. WESTRUP

and ARDIS B. WESTRUP, Joint Tenants; JAY BROTHERS;

LYLE BROTHERS, Individually and as Joint Tenant with

PATRICIA R. BROTHERS; ALVIN ENGELLAND; ANSEL

ENGELLAND; JACK ENGELLAND and VIVIAN M. ENGEL-

LAND, Joint Tenants; GERALD N. JONES and DONNA

JONES, Joint Tenants; ROBERT A. JOHANNSEN; RAY-

MOND E. ToBIAS; GARY ZWICK; LESTER COLLE; HAR-

VEY WILLHAUS and MARILYLN WILLHAUS, Joint Ten-

ants; WILMOR H. ODEN; RAPHAEL ROEDER and ANNA-

BELLE A. ROEDER, Joint Tenants; EDRIS EDWARDS;

EDWARD F. JANDA and ANNA MAE JANDA, Joint Ten-

ants; HARRY ZWICK; ARTHUR H. ODEN; JOLEEN J.

OTTLINGER; and WILLIAM L. BEMIS and DOROTHY

BEMIS, Joint Tenants ee

Plaintiffs-A ppellees,

v.

CUDAHY COMPANY, a Delaware Corporation, and

GENERAL HOST CORPORATION, a New York Corporation,

Defendants-A ppellants.

Appeal from the United States District Court

for the District of Kansas

(D.C. No. 77-1212)

2a

[Filed Sept. 28, 1988]

John Logan O’Donnell (Thomas D. Kitch and Ron

Campbell, Fleason, Gooing, Coulson & Kitch, Wichita,

Kansas, and E. Sherrell Andrews and Michael L. Spaf-

ford with him on the brief), Olwine, Connelly, Chase,

O’Donnell & Weyher, New York, New York, for Defend-

ants-Appellants.

H. Lee Turner (Deborah Turner Carney, Golden, Colo-

rado, and Casey R. Law and Lisa A. Beran with him on

the brief), Turner and Boisseau, Chartered, Great Bend,

Kansas, for Plaintiffs-Appellees.

Before LOGAN, BARRETT and BALDOCK., Circuit

Judges.

BALDOCK, Circuit Judge.

In this diversity action, plaintiffs-appellees claimed

that the American Salt Company’s (American Salt) salt

mining operations caused the pollution of an under-

ground aquifer passing under their farms, resulting in

their inability to utilize the water in the aquifer for ir-

rigation. At the time appellees filed their complaint,

American Salt was an operating division of defendant-

appellant Cudahy Company (Cudahy), which is a wholly-

owned subsidiary of defendant-appellant General Host

Corporation (General Host). The district court con-

cluded that the pollution emanating from the salt plant

constituted a continuing, abatable nuisance causing tem-

porary damages and found appellants liable for $3.06

million in actual damages and $10 million in punitive

damages. The court then held the punitive damages

9

oa

award in abeyance and retained jurisdiction over the

award pending the presentation of a remedial plan to

clean the aquifer. Subsequently, the court abandoned

the remedial plan, entered final judgment on the punitive

damages award and assessed as costs to appellants cer-

tain post-trial expert witness fees.

In this consolidated appeal, appellants contend that 1)

appellees’ claims are barred by the statute of limitations,

2) the district court’s method of calculating actual dam-

ages was erroneous as a matter of Kansas law, 3) the

court erred in awarding punitive damages, 4) General

Host cannot be held liable in the absence of evidence that

Cudahy was its alter ego, and 5) the court erred in as-

sessing post trial expert witness fees in excess of the

statutory limit. We affirm in part and reverse in part.

The complex historical and factuai background sur-

rounding this litigation has been exhaustively detailed

by the district court. See Miller v. Cudahy Co., 567 F.

Supp. 892, 894-95 (D. Kan. 1983) (Miller I); Miller v.

Cudahy Co., 592 ¥. Supp. 976, 981-1002 (D. Kan. 1984)

(Miller II). As a consequence, we will provide only a

brief overview of the factual setting. We note at the

outset that we have carefully reviewed the voluminous

trial transcript in its entirety and conclude that the dis-

trict court’s comprehensive factual findings, Miller IJ,

592 F. Supp. at 981-1003, are amply supported by the

record.

Appellees are owners and lessees of real property lo-

eated in Rice County, Kansas. The land is used pri-

marily for agricultural production. American Salt, along

with its predecessor, has operated a salt manufacturing

plant near Lyons, Kansas since 1908.

Located two miles south of Lyons is Cow Creek, which

flows in a southeasterly direction and is a minor tribu-

4a

tary of the Arkansas River. Below Cow Creek is the

Cow Creek Valley Aquifer (the aquifer), an underground

fresh-water stratum which occupies a width of one to

two miles and lies at depths of between approximately

ten and seventy feet. The acquifer also flows in a south-

easterly direction, at a rate of between one-and-a-half and

five feet per day. The water in the aquifer passes under

the land owned or leased by appellees after it has passed

under American Salt’s brine fields and plant.

Salt concentrations of over 30,000 parts per million

have been recorded in water samples drawn from the

aquifer. Concentrations of 250 parts per million are

sufficient to render water unfit for domestic or irriga-

tion use. As found by the district court, the salt present

in the aquifer escaped from the property and control of

American Salt. The majority of the salt escaped through

subsurface leaks, while the remainder percolated down-

ward from surface spills.

Due to insufficient rainfall, farmers in Rice County

are unable to grow corn without irrigating their land.

Appellees alleged that because of the salt pollution of

the aquifer, they are unable to irrigate and therefore

can grow only dryland crops such as wheat and milo,

which do not produce the revenues generated by corn

crops.

The district court, in commenting on the more than

half-century of disputes between American Salt and area

farmers, described the historical background of this case

as “Dickensian” in nature. Miller v. Cudahy Co., 656 F.

Supp. 316, 319 (D. Kan. 1987) (Miller III). Final reso-

lution of this lawsuit itself required nearly a decade. On

May 31, 1977, appellees filed their complaint seeking in-

junctive relief and actual and punitive damages. Fol-

lowing a protracted discovery period, the final pretrial

order was filed on March 9, 1982.

da

The district court denied appellants’ motion for sum-

mary judgment,’ which was predicated on their conr-

tention that appellees’ claims were barred by the statute

of limitations. The court concluded that appellees’ show-

ing was sufficient to categorize the American Salt opera-

tion as a continuing, abatable nuisance causing tempo-

rary damages and giving rise to a continuing series of

causes of action. Miller I, 567 F. Supp. at 906-08. The

court also concluded that the two-year statute of limita-

tions did operate to preclude appellees from recovering for

injuries sustained more than two years prior to the

filing of their complaint. Jd. at 909. The court stated

that appellees were entitled to attempt to prove and

recover their damages accruing between a date two years

before the complaint was filed (May 31, 1975) and the

date of judgment. /d. at 909.

Following a bench trial, the court found appellants

liable for temporary damages to annual crops and

awarded appellees $3.06 million in actual damages for

the period of 1975 through 1983. Miller IT, 592 F. Supp.

at 1005. The court arrived at the amount of lost crop

profits by calculating the difference between the net value

of corn crops and the net value of the wheat and milo

crops which were actually grown. Id. at 990-92. The

court also awarded $10 million in punitive damages;

however, it retained jurisdiction over the award and held

final judgment in abeyance, pending eppellants’ “oood-

1The court did enter summary judgment against several plain-

tiffs whose land was either completely outside the boundaries of

the aquifer or had not yet been affected by the salt pollution of the

aquifer. Miller 1, 567 F. Supp. at 897-98.

2The district court also concluded that appellants were liable

to several individual plaintiffs for the following actual damages:

approximately $8,000 for brine trespasses; nominal damages of $1

for pipeline trespass; consequential damages of $7,000 for damage

to three domestic water wells; and consequential damages of

42.500 for damage to a dairy operation. Miller 1], 592 F. Supp.

at 1005-06.

6a

faith efforts to define and remedy the pollution they”

have caused.” Jd. at 1007-08. Pursuant to Fed. R. Civ.

P. 54(b), the court entered final judgment on the issues

of liability and actual damages. Jd. at 1008-09. Appel-

lants filed a timely notice of appeal, but this court dis-

missed their appeal as premature. Miller v. Cudahy Co.,

No. 85-1450, slip op. at 6 (10th Cir. Jan. 31, 1986).

Three years later, the district court rejected a court-

ordered cleanup plan, because no feasible plan had been

presented, and declined to remit any of the punitive dam-

ages award. Miller I]], 656 F. Supp. at 356-57. The

court also denied as untimely appellant General Host’s

motion to dismiss, in which General Host had argued that

the court had incorrectly applied the doctrine of piercing

the corporate veil in finding General Host liable for the

salt pollution of the aquifer. 7d. at 322-24. Finally, the

court taxed as costs to appellants the expert witness

fees of appellees’ trial expert for his participation in

the post-trial remedial action phase. /d. at 339.

I.

Appellants first argue that appellees’ claims are time-

barred, the primary thrust of their argument being that

the injuries suffered by appellees are permanent in na-

ture and were ascertained long before the statute of

limitations began to run. They additionally assert that

they should not be equitably estopped from raising the

statute of limitations defense.

The applicable Kansas statute of limitations, Kan. Stat.

Ann. § 60-513 (1983), provides in pertinent part:

(a) The following actions shall be brought within

two (2) years: (1) An action for trespass upon

real property.

(4) An action for injury to the rights of another,

not arising on contract, and not herein enumerated.

ie

i i = i ,

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two-yt statute imi ? s whether the injuries

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sustained by app s are permanent or temporary in

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Kansas nuisance law from 1876 to the present, noted thal

th ni add ne 4 Matis :; wee}

re reieva eases adaresslngy ¢ LISLINC DELW et

. . - + ‘ + - yee xT om. 2492963 rho 4 +7 > sé .

ermanel and temporary nyu s are somewna incieal

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, mn roi10+aon?4 1} . / r i 1717 at Q¢

na ineonsistent. Mute) , oof F. Supp. a ehh

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[he K San Up C1lii<t ( yu) r\ ‘y » ni S re OY T) ul rit

eather canfused state of the law concerning the disti

GALLIC! CUILUSel & { U iit LaW CUTICeCT IIE LiAX Lis ii

n between permanent and temporary nuisances. S¢é

e.ff. Gown) g v. VJ ‘Candless. 547 P.2d 300, 34? (Kan.

1976): Henderson v. Talbott, 266 P.2d 273, 278 (Kan.

1954). The supreme court recently indicated that the

distinction between temporary and permanent damages

remains a viable concept, however, while emphasizing

that “no hard and fast rule can be adopted as to when

the damages are deemed permanent and when they are

deemed temporary.” Olson v. State Highway Comm'n of

Kan., 679 P.2d 167, 172 (Kan. 1984). Noting that some

ly to the permanent or temporary

eases refer not onl

? ‘ : +L, ‘ ‘ ‘ : - 1 7 ] . *) y)

ure or tne damages but also to the permanent 01

4 ~~ nr ieur . “440 f +] 291100 $77 ja pt }* } ~h11yT

emporary nature of the causative factor, the court

ressed tha elach case must be considered in its own

et +} a

ractuai Secung. Id

1 1 . Pe " J + 7 04

In 1a a 1 eXamination Qi] he pertinent Kansas

] Ly 2) +} ] T 1}°1 ars) Vat aha iced th + +} )

ouls ee CaSes ne ql rl¢ Coul Was COnVINCcEet nla ra

7 ’ 4 4

\s adeseribea non orts real t bere S per! it » 1 r¢

mpenetrable jungle in the er law than that which surroun¢

41 ‘ ‘ 9 »9 y , T | T ‘

he word ‘nuisance W. Keeton, D. Dobbs, R. Kecton & ), Owen

Prosser and Keetun on Torts 616 (5th ed. 1984 In regard to t

ecific issue presentea here, ano her treatise notes the ¢ ral

( nt IS n rroun 1! th qd { net the Ct l ha dra i b

+ ? . > tT

en | inent and tempora! lisances. J] itlarper, | Ja

aw U. UG) Ihe a ol oris 1.30 (2d ed. 1986

8a

Kansas Supreme Court, if presented with [appellant’s]

statute of limitations argument, would find that argument

unpersuasive.” Miller 1, 567 F. Supp. at 906. Our read-

ing of those cases comports with the district court’s, and

we conclude that the salt pollution resulting from Amer-

ican Salt’s operations constitutes a continuing nuisance

causing temporary damages.

Under Kansas law, the plaintiff has the option of

suing for either permanent or temporary damages.’ See

Augustine v. Hinnen, 443 P.2d 354, 355-56 (Kan. 1968).

If permanent damages are sought, an action claiming

such damages must be brought within two years. Gow-

ing v. McCandless, 547 P.2d at 343. ‘Permanent dam-

ages are given on the theory that .the cause of injury

is fixed and that the property will always remain sub-

ject to that injury.” McAlister v. Atlantic Richfield

Co., 662 P.2d 1203, 1211 (Kan. 1983). They “are dam-

ages for the entire injury done—past, present and pros-

pective—and generally speaking |[are| those which are

practically irremediable.” /d.

If the injury or wrong is classified as temporary, the

limitation period starts to run only when the plaintiff's

land or crops are actually harmed, and for purposes of

the statute of limitations, cach injury causes a new cause

of action to accrue, at least until the injury becomes

permanent. Williams v. Amoco Production Co., 734 P.2d

1113, 1119 (Kan. 1987); Gowing v. McCandless, 547

4In support of their argument that the salt pollution constitutes

a permanent nuisance, appellants contend that appellees’ original

complaint was pled in terms of permanent damages. That conten-

tion is without merit. The final pretrial order describes the con-

tentions’and issues in terms of continuing nuisance and trespass.

Rec. vol. I, doc. 309 at 4; see Miller IJ, 567 F. Supp. at 907-08.

Further, the Kansas Supreme Court has indicated that an allega-

tion of permanent damazgcs \.ould include allegations of temporary

damages. Kiser v. Phiil:ps Pipe Line Co., 41 P.2d 1010, 1011 (xan.

1935).

9a

P.2d at 342; see generally F. Harper, F. James & O.

Gray, The Law of Torts § 1.30 (2d ed. 1986). This rule

is especially applicable if the situation involves elements

of uncertainty, “such as the possibility or likelihood of

the alteration or abatement of the causative condition.”

Gowing v. McCandless, ‘547 P.2d at 342. The rule is

predicated upon the defendant’s ability and duty to abate

the existing conditions which constitute the nuisance. Jd.

at 343; accord McAlister v. Atlantic Richfield Co., 662

P.2d at 1211 (stating that temporary damages “are

awarded on the theory that cause of the injury may and

will be termirated”’).

Appellants rely primarily on McAlister v. Atlantic

Richfield Co. in arguing that the damages caused by

their admitted pollution of the aquifer will last indefi-

nitely (at least 200 years) and therefore are permanent

for purposes of the statute of limitations.» In McAlister,

the plaintiff sued for temporary damage to his water

well caused by the defendant’s oil fields. The plaintiff

alleged “that not less than 150 nor more than 400 years

will pass before the well water will be once again fit for

drinking.” McAlister v. Atlantic Richfield Co., 662 P.2d

at 1212. Under the circumstances of that case, in which

5 Appellants further rely on Atkinson v. Herington Cattle Co.,

436 P.2d 816 (Kan. 1968), in which the plaintiff brought suit

within two years of discovering nitrate pollution in a well which

supplied water for his dairy farm. The nitrates had emanated from

the defendants’ feediot operation. The Kansas Supreme Court

affirmed the trial court’s conclusion that proof that damage to

real property will remain ‘for an indefinite time” will sustain a

judgment for permanent damages. Jd. at 820, 824.

Atkinson is distinguishable. The issue was framed in terms of

sufficient evidence to sustain the trial court’s award of actual dam-

ages, and did not involve any discussion of the elusive permanent-

temporary distinction. Moreover, as discussed above, appellants’

reliance on the allegedly permanent nature of the injury overlooks

the nature of the causative factor, i.e., American Salt’s operation,

which must also be factored into the analysis of whether damages

resulting from a nuisance are permanent or temporary.

10a

there was no indication that the pollution was abatable

and the relevant defendants had discontinued oil well

operations in the 1940’s, the Kansas Supreme Court held

that portion of the claim to be barred by the two-year

statute of limitations because the injury was “fixed” and

“the property will always remain subject to that in-

jury.” Id. at 1211-12.

Pointing to information generated during the post-

trial remedial phase, which purportedly indicates that

any cleanup of the aquifer will take as long as 200 years,

appellants contend that McAlister is controlling in that

the injuries to appellees’ farms are fixed and cannot be

remedied within a reasonable time.® Initially, we agree

with appellees that appellants cannot rely on post-trial

“evidence,” in particular the data contained in their own

reports, to bolster their argument on appeal that the in-

juries are permanent for purposes of the running of

the statute of limitations. This court will consider only

that evidence adduced at trial. It should be noted that

appellants filed a motion for a new trial, based in part

on their post-trial testing of the aquifer which purport-

edly indicated that any cleansing of the aquifer would

take significantly longer than had been indicated previ-

ously. The district court denied the motion, Miller III,

656 F. Supp. at 334, and appellants de not appeal that

ruling.

The trial evidence indicates that the damage to the

aquifer is remediable if the salt pollution is abated.

6 Appellants also cite to the district court’s statement, made

upon concluding that a court-ordered cleanup plan was not feasible,

that ‘the pollution is still not remediable within a reasonable time,”

Miller III, 656 F. Supp. at 357 (emphasis in original). Taken in

context, the court’s statement was made in reference to the unten-

able nature of a court-supervised remedial plan, see id. at 351-57,

and in any event is certainly not conclusive as a refutation of the

trial evidence regarding the time frame for cleansing the salt

pollution from the aquifer.

lla

While it is true that no conclusive time frame for the

cleansing of the aquifer has been established, it is ap-

parent to this court that, contrary to appellants’ conten-

tion, the cleanup process can be accelerated by interven-

tion measures and can be achieved within a reasonable

time. Further, appellants’ argument focusing solely on

the nature of the injuries resulting from the salt pollu-

tion of the aquifer disregards the fact that we must also

look at the nature ef the causative factor of the pollu-

tion.? Olson v. State Highway Comm’n of Kan., 679 P.2d

at 172. Appellants do not contend that there is no “pos-

sibility or likelihood” that the causative condition, namely

American Salt’s mining operations, can be altered or

abated. Gowing v. McCandless, 547 P.2d at 342. The

record indicates that the cause of the injuries can be

terminated, and indeed appellants state that they have

already undertaken measures to do so. See Brief for

Defendants-Appellants at 35. Nor do appellants argue

that they have no duty to abate the existing conditions

which constitute the nuisance. See Gowing v. McCandless,

7In pointing out the inconsistent use of the terms “temporary”

and “permanent” in the Kansas cases, the district court noted

that, when realty is damaged by pollution, the terms ‘temporary’

and ‘permanent’ can be applied to three quite distinct facets

of the situation. First, the pollution itself, or the causal chem-

istry of the injury to the land, may be either temporary or

permanent. Second, the damage or loss caused by the injury

may be temporary or permanent. Last, the source or origin of

the pollution, be it a sewage plant, an oil well, or a salt mine,

may be temporary or permanent. The possibilities for incon-

sistencies are, of course, multiplied when different labels are

applied to these facets, such as, for example, calling the source

of the pollution a nuisance and then characterizing the nuisance

as temporary or permanent.

Miller I, 567 F. Supp. at 899-900 (emphasis in original). The

district court’s analysis is helpful to our determination of the

legal nature of the nuisance and serves to reinforce our interpre-

tation of the Kansas nuisance cases, namely that appellants’ argu-

ment is deficient by virtue of focusing solely on the nature of the

injuries resuiting from the salt pollution of the aquifer.

12a

047 P.2d at 343; McAlister v. Atlantic Richfield Co., 662

P.2d at 1211. The conclusion that the damages are tem-

porary is bolstered by the evidence that the salt pollution

actually continued during the course of this litigation,

further indicating the existence of a continuing nuisance.

See Miller II, 592 F. Supp. at 990.

The damage to the aquifer is remediable and the cause

of the damage is abatable. Upon considering all the

facts and circumstances, including the nature of the pol-

lution and the nature of the causative factor, as well as

the continuing pollution of the aquifer, we conclude, as

did the district court, that American Salt’s operation

constitutes a continuing nuisance causing temporary dam-

ages.

Having rejected appellants’ assertion that the damages

resulting from their pollution of the aquifer are perma-

nent for statute of limitations purposes, we also reject

their claim that all of appellees’ claims are time-barred.

The fact that salt pollution has existed in the aquifer

for many years does not negate the district court’s limi-

tation of appellees’ recovery to temporary damages. By

limiting their potential recovery to those damages in-

curred not more than two years prior to the filing of

their complaint, the court implicitly determined that the

two-year statute of limitations precluded any claims for

permanent damages.

Finally, appellants contend that they should not be

equitably estopped from asserting that appellees’ claims

are time-barred. The district court concluded that the

statute of limitations should be equitably tolled and that

the appellants should be equitably estopped from relying

on the statute of limitations defense.’ Miller II, 592

8 The court’s Conclusion of Law No. 38 states:

The Court concludes that, in the event the statute of limi-

tations is deemed to apply to the claims of the plaintiffs in this

case in such a way as to completely bar those claims, the facts

13a

F. Supp. at 1008. Our resolution of the statute of limita-

tions question obviates the need to address this issue.

II.

Arguing that the district court’s method of calculating

actual damages was erroneous as a matter of law, ap-

pellants assert that the amount of temporary damages

awarded cannot exceed the potential recovery for perma-

nent damages. They alternatively contend that, assuming

the propriety of an award of temporary damages, the

proper measure of such damages is the reduced rental

value of appellees’ land.

The district court’s calculation of the amount of actual

damages is reviewed under the clearly erroneous stand-

ard. Fed. R. Civ. P. 52(a). We are not constrained by

the clearly erroneous standard, however, if the court’s

computation of damages is predicated upon a misconcep-

tion of the governing rule of law. Chaparral Resources,

Ine. v. Monsanto Co., 849 F.2d 1286, 1289 (10th Cir.

1988) (addressing proper legal standard for damages re-

sulting from the wrongful repudiation of a contract).

The temporary-permanent distinction which is deter-

minative in regard to the running of the statute of limi-

tations is also relevant to the question of the proper

measure of damages resulting from an actionable nui-

sance. See McAlister v. Atlantic Richfield Co., 662 P.2d

at 1211; F. Harper, F. James & O. Gray, The Law of

Torts at $1.30. In Kansas, the measure of damages for

permanent injury to real property is the difference in

the fair market value of the land before and after the

injury. Williams v. Amoco Preduction Co., 734 P.2d at

and circumstances shown by the evidence clearly demonstrate

that the statute of limitations should be equitably tolled and

that the defendants should be equitably estopped from relying

on the statute of limitations defense. See, e.g., Newton v.

Hornblower, Inc., 224 Kan. 506, 516, 582 P.2d 1136 (1978).

Miller 11, 592 F. Supp. at 1008.

l4a

1120; Kiser v. Phillips Pipe Line Co., 41 P.2d 1010,

1011-12 (Kan. 1935). Diminished fair market value is

noi used as the measure of recovery, however, if an

injury to real property is temporary in nature. Tem-

porary damages represent the reasonable cost of repair-

ing the property, “which may include the value of the

use thereof during the period covered by the suit, or it

may be the diminution in the rental value of the prop-

erty, together with such special damages to crops, im-

provements, ete.” Kiser v. Phillips Pipe Line Co., 41

P.2d at 1012; accord Alexander v. Arkansas City, 396

P.2d 311, 315 (Kan. 1964).

Appellants’ assertion that temporary damages may not

exceed the value of the property. injured, or essentially

that there must be a “eap” on an award of temporary

damages, is unsupported by pertinent Kansas authority.

Their alternative contention, that the sole measure of

such damages is reduced rental value, is likewise unsup-

ported. While reduced rental value of the property in-

jured is indeed one measure of temporary damages, the

value of the use of the property is also a proper measure

of damages. The Kansas Supreme Court has treated the

value of the use of property and the diminution of rental

value as separate and distinct bases for awarding tem-

porary damages. See Alexander v. Arkansas City, 396

P.2d at 315; Kiser v. Phillips Pipeline Co., 41 P.2d at

1012; see also D. Dobbs, Remedies § 5.3 (1973) ( noting

difference between rental value and use value).

The district court found that because irrigated corn

crops would be more profitable than the dryland crops

appellees were forced to grow because of the salt pollu-

tion of the aquifer, appellees “have been damaged by the

pollution to the extent of these lost crop profits.” Miller

II, 592 F. Supp. at 991. In so finding, the court applied

the proper legal standard under Kansas law for measur-

ing temporary damages. See Kiser v. Phillips Pipe Line

Co., 41 P.2d at 1012. The court’s calculation of actual

15a

' damages, made upon consideration of the similar for-

mulas presented by the various expert witnesses, was

based upon the difference between the net value of the

lost corn production and the net value of the wheat and

milo crops actually grown. Miller II, 592 F. Supp. at

991-92. That calculation is supported by the evidence

and is not clearly erroneous.

III.

Appellants next contend that the $10 million punitive

damages award is not supported by the evidence. They

further contend that the district court abused its discre-

tion by refusing to eliminate or substantially reduce the

“contingent” award at the close of the post-trial remedial

phase and that the Kansas law of punitive damages is

unconstitutional as applied to the facts of this case.

A.

The issue of whether there is sufficient evidence to jus-

tify an award of punitive damages is a question of law.

Alley v. Cubser Development Co., 785 F.2d 849, 855

(10th Cir.), cert. denied, 107 S. Ct. 457 (1986) (apply-

ing Colorado exemplary damages statute). In a diversity

case, the circumstances under which punitive damages

are available are governed by state law, as are the sub-

stantive elements upon which such an award may be

based. O’Gilvie v. International Playtex, Inc., 821 F.2d

1438, 1448 (10th Cir. 1987), cert. denied, 108 S. Ct.

2014 (1988) (addressing remittitur of punitive damages

award). “Thus, an assessment of the propriety of award-

ing punitive damages and the sufficiency of the evidence

to support the award must necessarily be made by ref-

erence to the factors that the state has deemed relevant

in determining whether punitive damages are appro-

priate.” 7d.

Under Kansas law, punitive damages may be imposed

for a willful and wanton invasion of an injured party’s

l6a

rights, the purpose being to restrain and deter others

from committing like wrongs. Jd. at 1446; Wooderson v.

Ortho Pharmaceutical Corp., 681 P.2d 1038, 1061

(Kan.), cert. denied, 469 U.S. 965 (1984). “Wanton-

ness is characterized by a realization of the imminence

of damage to others and a restraint from doing what is

necessary to prevent the damage because of indifference

as to whether it occurs.” * Boehm v. Fox, 473 F.2d 445,

447 (10th Cir. 1973). A punitive damages award “must

be viewed in light of the actual damages sustained, the

actual damage award, the circumstances of the case, the

evidence presented, the relative positions of the plaintiff

and the defendant, and the defendant’s financial worth.”

Wooderson v. Ortho Pharmaceutical Corp., 681 P.2d at

1064.

In the instant case, the award of punitive damages is

clearly supported by the evidence, in particular the testi-

mony of three former American Salt employees. It is

readily apparent that appellants created the nuisance and

“persistently maintain[ed] it with a reckless disregard

for the rights of others.” Newman v. Nelson, 350 F.2d

602, 604-05 (10th Cir. 1965). Appellants’ conduct was

deliberate, with full knowledge of the consequences and

with a marked indifference thereto.

®In Newman v. Nelson, 350 F.2d 602 (10th Cir. 1965), a di-

versity case in which the jury awarded actual and punitive damages

for the pollution of the plaintiff’s stock pond by crude oil escaping

from the defendant’s oil lease operations, this court noted that there

was “no reason to doubt that Kansas courts would embrace the

nuisance theory for punitive damages.” Jd. at 604. As explained

by Chief Judge Murrah, “to be liable for actual damages one need

only create or commit a nuisance, but to be punished for it he

must create and persistently maintain it with a reckless disregard

for the rights of others.” Id. at 604-05 (emphasis added). Based

on that legal premise, the panel concluded that “the proof falls far

short of showing an indifferent maintenance of a nuisance” and

reversed the judgment as to punitive damages. Jd. at 605-06.

B.

Contending that the district court abused its discretion

by refusing to remit the punitive damages award at the

close of the post-trial remedial phase, appellants char-

acterize the court’s award as “contingent.” That char-

acterization is premised on the court’s retention of juris-

diction over the award “to evaluate a potential cleanup

to be implemented in lieu of some or all of the punitive

damages award.” Miller III, 656 F. Supp. at 324. The

court stated that, because appellants’ post-trial conduct

would be “extremely relevant” to their “state of mind”

at the time of the occurrences, punitive damages would

be eliminated or substantially reduced if the defendants

undertook a “conscientious, good-faith, and realistic ef-

fort to address and remedy, within a reasonable time,

the pollution presently existing in the aquifer.” Miller IT,

592 F. Supp. at 1007-08. Appellants now argue that

their post-trial conduct “is further proof of their good

intent” and that the court abused its discretion by be-

latedly imposing new conditions for establishing good

intent.

Federal law governs the decision whether a remittitur

should be granted, the decision being tested on appellate

review by an abuse of discretion standard. K-B Trucking

Co. v. Riss Int'l Corp., 763 F.2d 1148, 1162 (10th Cir.

1985). In O’Gilvie, which was handed down some three

months after the district court’s final opinion, this court

held that a trial court is without authority under either

state or federal law to reduce a punitive damages award

on the basis of post-trial conduct.’° O’Gilvie v. Interna-

10In O’Gilvie, the plaintiff alleged that his wife’s use of the

defendant’s super-absorbent tampons caused her death from toxic

shock syndrome. The jury awarded the plaintiff $10 million in puni-

tive damages. Upon the defendant’s post-trial representation that

it was discontinuing the sale of some of its products, instituting a

program of alerting the public to the dangers of toxic shock syn-

drome and modifying its product warning, the district court

18a

tional Playtex, Inc., 821 F.2d at 1449-50. Thus the dis-

trict court would have been without discretion to reduce

or eliminate the punitive damages on the basis of events

occurring after the trial." See id. at 1449. While the

district court did not have the benefit of this court’s

opinion in O’Gilvie upon entering final judgment on the

punitive damages award, any reduction, or elimination,

of the award would have been highly questionable, given

our perception that there is no relationship between ap-

pellants’ post-trial conduct and their state of mind at

the time of the tortious acts. Even assuming that appel-

lants’ post-trial conduct was relevant, and that the dis-

trict court had the power to remit the punitive damages

award on the basis of that conduct, we would be unable

to find the court would have abused its discretion in not

doing so. See Miller III, 656 F. Supp. at 354-356 (dis-

cussing appellants’ lack of good faith in the post-trial

remedial phase).

Regarding the court’s retention of jurisdiction over

the punitive damages award, this case points up some

ordered the punitive damage award reduced to $1,350,000. O’Gilvie

v. International Playtex, Inc., 821 F.2d at 1440-41. After reviewing

the bases for remitting a punitive damage award, this court con-

cluded

that because the post-trial conduct upon which the trial court

relied in ordering remittitur in this case had no relevance to

the injurious conduct underlying the claim for punitive dam-

ages, the court was without authority under either state or

federal law to reduce the award on that basis. In addition, we

are compelled to point out that the court’s order subverts the

goals of punishment and deterrence that underlie the assess-

ment of punitive damages in Kansas.

Id. at 1450.

11 The district court apparently recognized that limitation on

its power to remit the punitive damages award. As stated by the

court, “[a]n elementary aspect of punitive damages seems to have

been forgotten in this case: they are awarded on account of past

behavior.” Miller II], 656 F. Supp. at 354 (emphasis in original).

19a

of the problems inherent in trial courts using their equi-

table jurisdiction to attempt to oversee solutions to prob-

lems such as the cleanup of the aquifer. The court’s at-

tempt to fashion an equitable remedy which would result

in the cleansing of the aquifer was well-intentioned, and

we have no reason to quéstion the court’s statements that

“the actions proposed went to the nature of relief [appel-

lees] were seeking, and were consistent with the relief

requested” and that the court was attempting “to fashion

a remedy which truly rectified the wrong, not merely

compensated for it.” Miller III, 656 F. Supp. at 351.

However, during the post-trial phase the parties ad-

dressed other matters only tangentially related to the

cleanup plans, id., and as the court candidly admitted,

see id. at 342, 351-57, a court-supervised remedial pro-

gram was simply not feasible.

C.

Finally, appellants assert that the Kansas law of puni-

tive damages is unconstitutional because it places no

limits on the amount of such awards. They argue that

because punitive damage awards are essentially penal in

nature, they mandate the procedural protection afforded

by the eighth and fourteenth amendments to the United

States Constitution.

Appellants have cited 1 persuasive federal constitu-

tional authority to support their argument. The Kansas

appellate courts have addressed similar arguments in

varying contexts and have concluded that the imposition

of punitive damages under Kansas law neither demands

the same safeguards afforded in criminal prosecutions

nor violates the due process clause. See, €.9., Tetuan v.

A.H. Robins Co., 738 F.2d 1210, 1245-46 (Kan. 1987) ;

McDermott v. Kansas Pub. Serv. Co., 712 P.2d 1199,

1203 (Kan. 1986); Unified School Dist. No. 490 v. Celo-

tex Corp., 629 P.2d 196, 206 (Kan. App. 1981).

20a

IV.

Appellants next argue that the district court erred in

imposing liability on General Host absent a finding of

piercing the corporate veil. The crux of its argument is

that the rccord is devoid of evidence sufficient to conclude

that Cudahy is General Host’s alter ego.

As discussed above, appellant General Host filed a

motion to dismiss several years after the completion of

the triai, arguing that the district court applied the

wrong legal analysis in considering General Host’s lia-

bility. The court denied the motion as untimely pled.

Miller Ill, 656 F. Supp. at 324. Countering appellees’

assertion that its piercing the corporate veil argument is

not properly before this court, General Host contends that

it preserved the issue by moving for a directed verdict

at the close of appellees’ case and by later submitting re-

quested findings of fact and conclusions of law on that

point. Brief for Defendants-Appellants (No. 87-1502)

at 52 n.56. It further points to appellants’ Fed. R. Civ.

P. 59 motion in which it argued that it could not be held

liable under any theory of liability. Id. We agree with

appellees that this issue is not properly before us, and

decline to address the merits of an issue upon which the

district court did not rule and for which appellees were

not compelled to produce any refuting evidence.

General Host’s oral motion for a directed verdict simply

stated that appellants would reserve argument and-eom-

ment on appellees’ evidence at the close of the case. Rec.

vol. 45 at 2602-03. In its motion to amend findings and

judgment or, in the alternative, for a new trial, General

Host argued on severs] grounds that it could not be held

liable for damages but did not argue that it shculd be

dismissed as a defendant.” Ree. vol. 2, doe. 462 at 28-

In its motion, General Host Stated that for the district court

to hold it “liable for damages, which were suffered by most of the

plaintiffs as a result of occurrences many years prior to 1973, is

2la

30. On appeal, General Host does not assign error to the

denial of its motion to dismiss, but rather argues that

the district court applied the wrong legal theory in im-

posing liability. It has not specified the manner in which

this issue was preserved for appeal.

In considering the protedural basis on which General

Host sought dismissal, the district court determined that

the motion was based on Fed. R. Civ. P. 12(b) (6). Mii-

ler Ill, 656 F. Supp. at 822-23. The court noted that

while General Host alluded to the theory in its answer,

it did not move for dismissal at that time, did not move

for dismissal on such grounds in any motion for judg-

ment on the pleadings under Fed. R. Civ. P. 12(h) (2),

and did not move for dismissal] at trial. Jd. at 323. The

court concluded that a mere recital of the defense of

failure to state a claim upon which relief can be granted

in the answer was insufficient to preserve the issue for

belated consideration. Jd. at 324.

Appellant General Host delayed far too long in seek-

ing dismissal claiming the alter ego theory did not apply.

Except in cases involving subject matter jurisdiction, an

appellate court is most reluctant to consider grounds

raised for reversal not adequately developed by a party

before or at trial. To be sure, there are exceptions, but

adherence to this principle encourages a single and com-

plete presentation of issues below and at trial. National

Advertising Co. v. City of Rolling Meadows, 789 F.2d

571, 574 (7th Cir. 1986). It also encourages sufficient

factual development of those issues presented and re-

without precedent.” Rec. vol. 2, doc. 462 at 28. The motion fur-

ther states that “[i]t would be one thing to require General Host

to pay for damages caused by American Salt since 1973; it is

quite another to use the events transpiring since May 31, 1975, to

make General Host liable for all damages suffered by plaintiffs,

regardless of when they occurred.” Id. (emphasis added). That

statement undercuts General Host’s argument on appeal that no

liability whatsoever can be imposed on it on the basis of a parent-

subsidiary relationship.

—

22a

spects tactical decisions made by both sides. A district

court is not obligated to develop offhand references to

legal terms into workable theories, National Metalcraft-

ers v. McNeil, 784 F.2d 817, 825 (7th Cir. 1986). Nor

must an appellate court perform this task. This ease

does not present extraordinary circumstances which

would warrant consideration of the merits of the motion

to dismiss. To the contrary, the alter ego issue is largely

a factual one and the record is not fully developed. More-

over, the trial court’s decision to hold General Host liable

based on its domination of Cudahy and American Salt,

see Miller II, 592 F.Supp. at 997-98, is supportable on

factual and legal grounds. See H. Henn & R. Alexander,

Laws of Corporations and Other Business Enterprises

$148 at 354-56 (1983) (“Where one corporation is

under the domination of another, the separate corporate

entities or personalities might be recognized, treating the

latter as principal and the former as agent, thus making

the acts of the latter in effect the acts of the former.’’).

For these reasons, we decline to address the substance

of General Host’s untimely motion to dismiss.

V.

The final issue raised by appellants is whether the dis-

trict court erred in awarding expert witness fees in

excess of the statutory limit. They contest the court’s

decision to tax as costs nearly $40,000 in fees and ex-

penses incurred by appellees’ trial] expert during the

post-trial remedial investigation.

Absent express statutory or contractual authorization

for the taxation as costs the fees of a party’s expert

witness, federal courts are bound by the limitations set

out in 28 U.S.C. $$ 1821 and 1920. Crawford Fitting

Co. v. J.T. Gibbons, ine., 107 &. Ce. 2494, 2498-99 (1987) .

Chaparral Resources, Ine. v. Monsanto Co., 849 F.2d at

1292. A party’s expert witness fees are recoverable only

up to the $30-per-day statutory limit applicable to any

Witness. Chaparral Resources, Inc. v. Monsanto Co., 849

23a

F.2d at 1292, Furr v. AT & T Technologies, Inc., 824

F.2d 1537, 1550 (10th Cir. 1987).

The district court found that certain fees and expenses

of Dr. Dan Raviv, a geohydrologist and appellees’ trial

expert, were properly taxable to appellants. Miller III,

556 F. Supp. at 339. These fees and expenses were

incurred in connection with the post-trial remedial action

phase of the case. Jd. Initially citing to a number of

pre-Crawford cases which indicated that such an award

would be a justifiable exercise of its equitable discretion,

id. at 337-39, the court found that such a basis for the

taxation of Dr. Raviv’s fees was unnecessary. Id. at 339.

Rather, the court stated that because its initial opinion

required appellants to consult an expert designated by

appeliees during the remedial phase, “[i]t should come as

no surprise now that [appeilants] are responsible to

pay for the expert consultations which they received.”

Id.

As we interpret the district court’s reasoning, Dr.

Raviv’s fees were assessed as costs because the court had

ordered the development of a remedial plan, thus mak-

ing Dr. Raviv a “quasi” court-appointed expert. In-

deed, the court did order appellants to consult with an

expert chosen by appellees in formulating a remedial

action plan. Miller IT, 592 F. Supp. at 1007, 1009. While

the court’s logie is easily followed, the record indicates

that the court refused to appoint an expert witness to

assist in the formulation of a remedial plan." See, e.g.,

13In Miller III, the district court explained that in denying

appellees’ motion for a court-appointed expert, what it declined

to do was to select an additional independent expert. Miller J/I,

656 F. Supp. at 338: The court stated that

[tlhe expert designated by the plaintiffs [appellees], Dr. Raviv,

was involved in the remedial action phase by specific order

of this Court, and his involvement was not affected by the

Court’s later order. In this context, it is apparent that Dr.

Raviv was not only a court appointed expert, but he was no

24a

Rec. vol. 3, doc. 624 at 1. Although the court could have

properly taxed Dr. Raviv’s fees had he been appointed

py the court, Crawford Fitting Co. v. J.T. Gibbons, Inc.,

107 S. Ct. at 2498, Dr. Raviv was not so appointed.

While we are cognizant of the unusual circumstances

presented by the court’s retention of jurisdiction pend-

ing the presentation of a viable cleanup plan, this case

does not come within any of the exceptions to the estab-

lished rule that expert witness fees are assessable only

up to the statutory limit. Nor could the court have

assessed the fees as an exercise of its equitable discre-

tion under Fed. R. Civ. P. 54(d). That discretion is

constrained by the fee statutes. Id. at 2499; Chaparral,

849 F.2d at 1292. We conclude that the district court

erred in awarding the post-trial expert witness fees of

Dr. Raviv.

We affirm the district court’s judgment in its entirety

with the exception of the assessment of the post-trial

expert witness fees of Dr. Raviv. We reverse the award

of the expert witness fees and remand for recalculation

of costs in compliance with 28 U.S.C. §§ 1821 and 1920.

AFFIRMED IN PART and REVERSED IN PART

and REMANDED.

longer ‘plaintiffs’ expert.’ Defendants were required by this

Court to work with him in developing their plan.

Id. The court then concluded that Dr. Raviv was in actuality

appellant’s expert. “Therefore, as Dr. Raviv was in reality ‘de-

fendants’ expert’ for the purpose of the remedial action phase of

this case—that is, he was an expert defendants were required to

and did consult in their plan development— it is not only equitable

to require them to pay his fees, but it is to be expected.” Id. at

338-39.

We cannot agree that Dr. Raviv was a court-appointed expert.

As discussed above, he was merely working on the court-ordered

remedial plan. If Dr. Raviv was appellants’ expert, then we have

the rather anomalous situation of the court ordering a party to

pay its own expert witness fees. We agree with appellants that

such is a mischaracterization based on Dr. Raviv’s use by the

appellees. See Brief for Defendant-Appellants (No. 87-2283) at

15-20.

ee ee

25a

APPENDIX B

UNITED STATES DISTRICT COURT

D. KANSAS

Civ. A. No. 77-1212

Ceci, W. MILLER and MILDRED E. MILLER, Joint Tenants;

MARGARET L. BIRCHENOUGH, Testamentary Trust, DoN-

ALD L. BIRCHENOUGH, ANSEL TOBIAS and WALTER

WRIGHT, Trustees; RUTH M. HOLLINGER, Individually

and as Joint Tenant with DELBERT HOLLINGER; JOHN

E. EDWARDS and KERMIT C. EDWARDS, Joint Tenants;

HOMER SHARPE; CECIL M. ToBIAS and FRANCES TOBIAS,

Joint Tenants; PAUL F. WESTRUP and ARDIS B. WEST-

RUP, Joint Tenants; JAY BROTHERS; LYLE BROTHERS,

Individually and as Joint Tenant with PATRiciA R.

BROTHERS; ALVIN ENGELLAND; ANSEL ENGELLAND;

JACK ENGELLAND and VIVIAN M. ENGELLAND, Joint

Tenants; GERALD M. JONES and DONNA JONES, Joint

Tenants; ROBERT A. JOHANNSEN; RAYMOND E. TOBIAS;

GARY ZWICK; LESTER COLLE; HARVEY WILLHAUS and

MARILYN WILLHAUS, Joint Tenants; EDRIS EDWARDS;

EDWARD F. JANDA and ANNA MAE JANDA, Joint Ten-

ants; HARRY ZWICK; ARTHUR H. ODEN; JOLENE J.

OTTLINGER; and WILLIAM L. BEMIS and DOROTHY

BEMIS, Joint Tenants,

Plaintiffs,

Ve

CUDAHY COMPANY, a Delaware Corporation, and

GENERAL Host CORPORATION, a New York Corporation,

Defendants.

March 38, 1987

26a

Turner & Boisseau Chartered, Great Bend, Kan., Deb-

orah Carney, Golden, Colo., for p!aintiffs.

Ron Campbell, Thomas D. Kitch of Fleeson, Gooing,

Coulson & Kitch, Wichita, Kan., for defendants.

OPINION AND ORDER

THEIS, District Judge.

Jarndyce and Jarndyce drones on. This scarecrow

of a suit has, in course of time, become so compli-

cated that no man alive knows what it means. The

parties to it understand it least; but it has been

observed that no two Chancery lawyers can talk

about it for five minutes without coming to a total

disagreement as to all the premises. Innumerable

children have been born into the cause; innumerable

young people have married into it; innumerable old

people have died out of it. Scores of persons have

deliriously found themselves made parties in Jarn-

dyee and Jarndyce, without knowing how or why;

whole families have inherited legendary hatreds with

the suit. The little plaintiff or defendant, who was

promised a new rocking-horse when Jarndyce and

Jarndyce should be settled, has grown up, possessed

himself of a real horse, and trotted away into the

other world. Fair wards of court have faded into

mothers and grandmothers; a long procession of

Chancellors has come in and gone out; the legion of

bills in the suit have been transformed into mere

bills of mortality; there are not three Jarndyces left

upon the earth perhaps, since old Tom Jarndyce in

despair blew his brains out at a coffee-house and

Jarndyce still drags its dreary length before the

Court, perenially hopeless.

C. Dickens, Bleak House.

27a

I. HISTORY OF THE LITIGATION

In 1908, the predecessor of American Salt began a salt

production operation southeast of Lyons, Rice County

Kansas. Salt production has continued at that location

continuously since. Also beginning in 1908, commensurate

with the salt production, highly concentrated brine began

running “off conveyor belts, elevator buckets and through

slats in drying room floors. It ponds on the surface at the

southeast corner of the plant. This brine also runs off

the property along the Frisco railroad to the county road

east of the plant.” Defendants’ Trial Exhibit A. This,

too, has apparently continued in varying degrees and

fashions ever since. By as early as 1927, a neighboring

landowner began finding his underground water supply

contaminated with chlorides from the brine, and was

forced to haul domestic water to his house.

The pollution continued. The Kansas Board of Heatlh

became involved in 1933. In the next year, neighboring

farmers hired an attorney who protested to the American

Salt plant concerning the injury from the salt runoff, and

demanded damages. The salt company demurred, claim-

ing that the pollution was not solely its fault, and de-

tailed to the farmers the plant’s new pollution control

improvements that would cure any pollution problems

then in existence. The year was 1935.

The pollution continued. Complaints continued. More

state investigations were conducted. The salt plant, in

conjunction with the state Board of Health, continued to

make “antipollution improvements.” The farmers bore

children. raised them to adulthood, and died. Their

children took over the farming operations. Land was

sold, or inherited by new generations. General Host Cor-

poration acquired Cudahy Company, including its Amer-

ican Salt Division. The Board of Health’s responsibilities

for this problem were assumed by the Kansas Department

of Health and Environment [KDHE]. Irrigation plans

28a

were abandoned. Suits were threatened. The pollution

continued.

This Dickensian matter was brought to this Court when

a complaint was filed on May 31, 1977. Discovery pro-

ceeded in a most unusual and contentious manner, and

a pretrial order was finally filed on March 9, 1982.

Defendants then filed an extremely lengthy motion for

partial summary judgment on November 2, 1982, the

general thrust of which was that the suit was barred

by the statute of limitations. Defendants argued that

since they had been polluting the underground aquifer

for so long it was no longer actionable: they had in

essence acquired a license to pollute based on long-stand-

ing habit. After being deluged with heavy briefing by

both sides, this Court squarely rejected defendants’ “pre-

scription by pollution” theory, and held that the con-

tinuing nature of the pollution emanating from the plant

was sufficient to categorize it as a continuing nuisance

causing temporary damages, giving rise to a continuing

series of causes of action. Miller v. Cudahy Co., 567

F.Supp. 892 (D.Kan. 1983).

The matter was called for a bench trial on March 26,

1984, and concluded on May 15. This Court handed down

its opinion in the matter on August 13, 1984. Miller v.

Cudahy Co., 592 F.Supp. 976 (D.Kan.1984). Therein,

the Court found defendants liable to plaintiffs for actual

damages to growing crops in the amount of $3,060,-

000.00, and also found defendants liable for punitive

damages in the amount of $10,000,000.00. Because of

trial testimony indicating that a cleanup of the aquifer

might be technologically feasible, the Court ordeved the

punitive damage award held in abeyance pending evalua-

tion of potential cleanup alternatives. The Court ordered

the defendants to undertake an investigation of the

aquifer in conj ction with an expert to be designated

by the plaintiffs, to keep the Court apprised of their dis-

coveries, and to prepare a final report on the available

——— L$

29a

scientific cleanup alternatives. Pending this, the Court

retained jurisdiction over the punitive damage award.

The Court certified the judgment of liability and the

judgment for actual damages as a final appealable judg-

ment pursuant to Rule 54(b) of the Federal Rules of

Civil Procedure. After defendants’ motion for a new

trial had been denied, they filed notice of appeal on

March 18, 1985. However, the Tenth Circuit dismissed

the appeal as premature on February 3, 1986, so the case

is still before this Court in full.

Investigation towards a possible cleanup began, and a

status conference was held before this Court the month

after judgment was entered, on September 11, 1984. De

fendants procured the expertise of Paul Roux of Roux

Associates, Inc., New York, New York, ground water

geologists; and of Leonard Eder of Eder Associates Con-

sulting Engineers, p.c., Locust Valley, New York. Plain-

tiffs retained the services of Dr. Dan Raviv, a ground

water hydrologist from West Orange, New Jersey, to

monitor and evaluate what the defendants were doing.

Plaintiffs had used Dr. Raviv extensively in discovery

and trial, and the Court had already found his credibility

high and his integrity impeccable. Almost immediately,

the remedial investigation became a problem in its own

right. Continual controversies arose over plaintiffs’ deny-

ing defendants access to their lands for the purposes of

conducting their investigations, and regarding damages

resulting from such access. Progress reports were filed,

but it became apparent that the ecological situation was

more complex than originally envisioned. The Court had

initially ordered that a final report on available alterna-

tives be filed within eight months of the August 13, 1984

Opinion and Order, but it was not until November 20,

1985 that defendants’ four volume proposed remedial

action plan with supporting documents was filed. That

plan, and the subsequent developments of proposed plans,

will be discussed later in this Opinion.

30a

In the meantime, numerous motions, related to the

cleanup only tangentially if at all, inundated the Court.

Following the Court’s Order in August of 1984, the ex-

pected motions for an amended judgment or new trial,

along with motions regarding costs taxed by the Clerk,

were filed. But in August of 1985, defendants filed their

second (though not last) motion for a new trial. From

then until this past summer not a month went by with-

out one of the parties filing a substantive motion of some

form for this Court’s determination: motions to compel,

to quash, to strike; motions for Court appointed experts,

for evidentiary hearings, for temporary restraining or-

ders; motions to preclude evidence, to disqualify law

firms, to strike affidavits. In the month of February,

1986, alone, six substantive motions, not including mo-

tions for extension of time (which inevitably engendered

their own controversies), were filed for this Court’s con-

sideration. Each motion required responsive filings, some

necessitated hearings, all consumed vast amounts of the

parties’ and the Court’s time. While not intimating that

the parties’ filings of these motions were procedurally

impermissible, the Court nonetheless found them frus-

trating to the original intent of retaining jurisdiction

over the case for the sole purpose of considering re-

medial cleanup plans for potential batement of the puni-

tive damage award. However, as will be demonstrated

infra, the development and discussion of numerous

cleanup proposals were not inhibited by these ancillary

actions.

It is the Court’s intention in this Opinion and Order

to resolve the remaining substantive motions in this ac-

tion, to evaluate the proposed remedial plans before it,

and to enter a final judgment as to all parts of this case.

While the Court suffers under no delusion that its action

will bring to a close this Jarndycian matter, the Court

ardently hopes that by at least allowing the inevitable

appellate process to begin, the illusive end of this case

may come closer to reality.

3la

Il. MOTION TO DISMISS

Defendant General Host has filed with this Court a

motion captioned Motion to Reconsider Denial of General

Host’s Motion to Dismiss. In fact, the Court’s review

of the voluminous filings in this case reveals that General

Host has not previously filed a motion to dismiss. The

defendant concedes that this is, in fact, an initial motion

for dismissal.

A. Consideration of Defendant’s Reply Memorandum

Before the Court addresses the merits of defendant’s

motion to dismiss, it must first resolve a procedural dis-

pute.-In the ongoing contentious spirit of this case,

plaintiffs have filed a motion to strike the defendant’s

reply memorandum in support of its motion to dismiss.

The parties’ pervasive fear that the other side might get

the last word on some ancillary or tertiary matter has

lead to a preponderance of the collateral attack strata-

gem of the “motion to strike” throughout the pendency

of this case. This approach has been used no less than

seven times in the post trial phase of these proceedings.

See Dk. nos. 593 (plaintiffs’ motion to strike portions of

defendants’ experts’ report), 616 (defendants’ motion to

strike plaintiffs’ “Observations and Objections to the

Cleanup Plan’), 639 (defendants’ motion to strike af-

fidavits), 665 ‘plaintiffs’ motion to strike defendants’

memorandum in connection with the entry of a final

judgment), 686 (plaintiffs’ motion to strike affidavits),

687 (plaintiffs’ motion to strike defendants’ reply memo-

randum), and 696 (plaintiffs’ motion to strike status

report). Each of these motions has then engendered its

own series of responses and repiies, and required court

rulings. Aside from unnecessarily cluttering the file, the

absurdity of this situation is demonstrated here by Dk.

no. 694 which is (there is simply no other way to put it)

“Plaintiffs’ reply to defendant’s response to plaintiffs’

motion to strike defendant’s reply to plaintiffs’ response

EE

32a

to defendant’s motion to reconsider denial of General

Host’s motion to dismiss.” At times, the Court has al-

most required the services of a cartographer to keep

straight which issue these filings address.

Plaintiffs ask the Court to strike this memorandum

(the litany will not be repeated) because they allege that

it was filed untimely, it is three times as long as the

original memorandum in support of the motion and it

addresses issues not raised in previous filings. While

plaintiffs may have valid concerns, in this ease it is sim-

ply too late in the day to begin policing the time and

length of filings. Plaintiffs’ motion is denied. The Court

wili now address the merits of defendant’s motion to

dismiss.

B. General Host’s Connection to American Salt

American Salt was acquired by Cudahy Company

around 1930, and operated as a division of that company

thereafter. In 1971, General Host acquired a controlling

interest in Cudahy Company, and gained full ownership

of Cudahy in 1972. Defendant claims that Cudahy was

acquired by General Host mainly for its large meat pack-

ing business, and that Cudahy’s salt division was only

an incidental part of that acquisition. In 1984, Ameri-

can Salt was separately incorporated as a wholly owned

subsidiary of Cudahy Company, which is a wholly owned

subsidiary of General Host Corporation. Apparently, in

1985, Cudahy Company was renamed AMS Industries,

Inc., although the Court has not been formally notified

of this charige. At no time has American Salt been an

operating division of General Host Corporation.

Defendant General Host agrees that, by the time it

acquired Cudahy Company, American Salt had been in

operation over 60 years. In 1968, state monitor wells

were installed by KDHE to evaluate groundwater pollu-

tion, and the condition of the aquifer resulted in KDHE’s

requiring American Salt to install the east water well

33a

in 1972, which through continuous pumping since its

installation has removed tons of chlorides from the

aquifer. Despite this, defendant argues that it did not

discover the extent of the pollution until after the law-

suit was filed, and them it concedes that most of what it

learned was gleaned from the plaintiffs. While appar-

ently not denying any knowledge of pollution prior to

that time, General Host chides the Court for failing to

acknowledge in its Opinion and Order that defendant

was the last to discover about the pollution and its con-

nection to the salt plant. General Host disputes the

Court’s imputation of knowledge of the groundwater pol-

lution to it based on KDHE’s imposition of fines for sur-

face spills.

The Court will agree that General Host learned of the

groundwater pollution emanating from the salt plant

well after plaintiffs or their predecessors, Cudahy Com-

pany, and the American Salt plant all knew of the prob-

lem. But this fact is inconsequential. General Host can-

not deny that it knew there was a pollution problem of

some magnitude when it acquired the company. The fact

that it was unaware of the extent of that pollution is

irrelevant; no one was fully aware of the extent of the

pollution until after discovery in the suit began. In fact,

as this Opinion and Order will demonstrate later, much

has been learned about the extent of the pollution since

the trial in this case. But it is hardly a surprising pro-

position that ignorance of the full extent of the damage

caused by one’s negligent or willful acts does not afford

a defense to liability for those acts.

C. Timeliness of Motion to Dismiss

More cogently, General Host argues for dismissal

under the doctrine of piercing the corporate veil, on the

theory that the Court applied the wrong legal analysis

when it originally considered General Host’s liability.

The Court did not originally address the corporate veil

34a

theory for the simple reason that no motion to dismiss

General Host was previously before it. Before the Court

can address that théory now, it finds that it must first

address a procedural question.

It has already been conceded that, despite the caption

of this motion, Genera] Host has not heretofore moved

for dismissal. The question therefore naturally arises

whether such a motion, made almost two years after

trial in this case was concluded, is timely. To consider

that question, the Court must first determine the proce-

dural basis on which General Host seeks dismissal. For

instance, if it was moving for dismissal under Rule

12(b) (1) of the Federal Rules of Civil Procedure, “lack

of jurisdiction over the subject matter,” timeliness would

not be a concern. It is undisputed that a court may dis-

miss a case for lack of subject matter jurisdiction at any

time, even on appeal. Fed.R.Civ.P. 12(h)(3). Here,

defendant did not specify its grounds for dismissal. The

Court, after examining all possibilities, has concluded

that the motion must be based on Rule 12(b) (6) of the

Federal Rules of Civil Procedure, “failure to state a

claim upon which relief can be granted.” No other

grounds for dismissal are applicable, and defendant’s al-

legation that plaintiff’s complaint does not aver any facts

showing that General Host Corporation is liable for the

plaintiffs’ injuries is most appropriately characterized as

a motion to dismiss pursuant to Rule 12(b) (6).

While a 12(b) (6) defense is not waived if not made

in an original motion or responsive pleading, as are de-

fenses under Rules 12(b) (2), 12(b) (3), 12(b) (4), and

12(b) (5), see Rule 12th) (1), it does not have the open

ended nature of a Rule 12(b) (1) defense. Instead, its

timeliness is to be considered under Rule 12(h) (2),

which allows the defense to be raised at any pleading

permitted or required under Rule 7(a), by a motion for

judgment on the pleadings, or at trial. Technically, Rule

12(b) requires that all such motions be asserted in a

35a

responsive pleading or a motion filed in lieu of the

response. Rule 12(h) only serves to preserve certain

defenses that could have been asserted initially in a Rule

12(b) motion. After the time for filing a Rule 12(b)

motion has passed, such defenses must be raised in the

fourm of a motion such as a motion for summary judg-

ment or for judgment on the pleadings. Wright & Miller,

5 Federal Fractice and Procedure: Civil § 1357. How-

ever, this fine distinction is not dispositive in this case,

as defendant has not filed a 12(b) (6) motion, but only

seeks to raise a defense allowable under 12(b) (6).

General Host did not move for dismissal upon such

grounds in its joint answer with Cudahy Company. It

did deny that the American Salt plant had ever been

maintained at the direction of any defendant other than

Cudahy, which is consistent with its corporate veil argu-

ment here. Dk. no. 5, { 9. Additionally, it alleged that

all claims for relief set forth in plaintiffs’ complaint

failed to state a cause of action upon which relief could

be granted against either defendant. Dk. no. 5, { 35.

But, although it asserted the defense then, it did not

then move for dismissal upon those grounds. Nor has

defendant since moved for dismissal on such grounds in

any motion for judgment on the pleadings, as permitted

by Rule 12th) (2). Finally, defendant did not make such

a motion for dismissal at trial.

The Court construes Rule 12(h)(2) as limiting the

time for raising such a defense to the enumerated occa-

sions. While that subsection is considerably more _ per-

missive than Rule 12(h) (1), it can not be construed to

allow such defenses to be raised at any time. Jf that

vere so, then the reason for separating out the provisions

in Rule 12(h) (3), and specifying that such defenses may

be raised “Whenever,” would not make sense. Instead,

the Rules seem clear that the defenses specified in Rule

12(h) (1) must be raised in the initial motion or re-

sponse, the defenses specified in Rule 12(h) (3) may be

36a

raised at any time, and the defenses specified in Rule

12‘h) (2), while not required to be raised initially, can-

not be raised indiscriminately but only on the specified

occasions. The occasions specified in Rule 12(h) (2) are

generous and liberal, allowing such defenses to be raised

at any time up to and including trial. But the separate

enumerations of 12(h) (2) and 12(h) (3) would indicate

to this Court that a motion to dismiss for failure to state

a claim upon which relief can be granted cannot be made

at any time. More specifically, it cannot be made after

trial. Because defendant’s motion was not made on one

of the allowable occasions, the Court finds the motion

untimely.

Although defendant did not discuss Rule 12(h) (2) in

any filing connected with this motion, the Court notes

that it did discuss it in Dk. no. 706, which deals with

a separate issue. There, defendant asserted that such

a motion can be made at any time prior to the entry of

final judgment. Defendant apparently arrived at this

conclusion by running together the “time of trial” and

the “time of entry of final judgment.” In a normal case,

the difference between these two times would be slight.

This is not a normal case. There will be a difference of

almost three years between the conclusion of trial and

the entry of final judgment. In such an issuance, the fine

line must be drawn, and the Rule clearly draws it at the

time of trial as the latest allowable time. Defendant’s

motion was not made then, so it was not made timely.

Cases under the Rule, and commentators on it, discuss

timing of Rule 12 motions in terms of the time for filing

a Rule 12(b) motion, and the time for preserving a Rule

12(b) defense pursuant to Rule 12th). The Court has

found few cases that discuss the instance where a Rule

12‘b) defense is raised timely, but a motion for dis-

missal on those grounds is not made until after trial.

The issue arose on appeal in Smith v. Atlas Off-Shore

Boat Service, Ine., 653 F.2d 1057, 1060 n. 1 (5th Cir.

37a

1981), where the Circuit Court allowed the defense of

failure to state a claim to be asserted on appeal because,

while Atlas did not specifically raise the issue at trial,

it “sufficiently alerted the trial court to its contention

that there is no claim... [and] adequately raised the

issue to preserve it for appellate review.” Jd. Likewise,

in Madore v. Ingram Tank Ships, Inc., 732 F.2d 475,

479-80 (5th Cir.1984), the Fifth Circuit again noted the

rule that the defense that a complaint fails to state a

claim upon which relief can be granted must be raised

before the completion of trial, but noted that if “the de-

fense is actually raised in the trial court, it is not waived

by failure to assert it in a specific manner.” Jd. (em-

phasis added). In Brule v. Southworth, 611 F.2d 406,

409 (1st Cir.1979), the court determined that defend-

ants’ argument, though presented as jurisdictional, was

in reality premised on the contention that plaintiffs had

failed to state a claim upon which relief could be granted,

and that it was “fatal that defendants never asserted

any such ground in the district court, either before or

during trial.” Jd. The court noted that the grounds

could have been asserted and therefore preserved “by

means of a directed verdict, judgment on the pleadings

or the like.” Jd. at-n. 4. See also Sartin v. Commissioner

of Public Safety, 535 F.2d 430 (8th Cir.1976).

Based on this authority, the Court must conclude that

merely raising the defense in an answer is not sufficient

of itself to preserve the defense so that a motion to dis-

miss based on that defense can be raised at any time.

While the above cited cases all deal with cases on appeal,

it must be conceded that in the normal course of things,

a case goes to appeal immediately after trial. The in-

stance here, where the trial court has retained jurisdic-

tion for over two years after trial, merely to fashion the

form of the damages awarded, is highly unusual to say

the least. The Court points out that it retained jurisdic-

tion for one specific purpose only: to evaluate a potential

38a

cleanup to be implemented in lieu of some or all of the

punitive damages award. The Court certified the bal-

ance of the decision, including the finding of liability

against General Host, for appeal. Although the Tenth

Circuit declined to exercise appellate review until the

entire case was before it, that does not change the fi-

nality of this Court’s decision. It is immaterial that the

trial court still has jurisdiction over the matter, trial

has been held, liability established, and judgment entered.

The interests of judicial finality are the same in this in-

stance as they are in the case of appellate review. Absent

something more than a bald recital in the defendants’

answer of the defense of failure to state a claim upon

which relief can be granted, this Court is convinced that

the weight of authority is overwhelming that such a mo-

tion, made after trial, is made too late. Therefore, the

Court must conclude that the Federal Rules of Civil Pro-

cedure no longer permit it to entertain such a motion.

Defendant General Host’s motion to dismiss is denied

as untimely plead.

III. MOTION FOR A NEW TRIAL

A. Procedural Posture of the Case

On August 12, 1985, eight years after this case was

filed and a year and a half after it was tried, defendants

filed a motion with this Court seeking a new trial pur-

suant to Rules 60(b) (2) and 60(b)(6) of the Federal

Rules of Civil Procedure. The ground asserted for their

motion was “newly discovered evidence,” evidence they

were later to assert was “practically conclusive.” Dk.

no, 573, p. 31. As had become par for this action, the

motion was hotly contested and exhaustively briefed by

both sides.

On January 31, 1986, the Tenth Circuit Court of Ap-

peals granted defendants’ motion to dismiss the appeal

in this cease as premature. The appeal had been taken

pursuant to this Court’s order of August 13, 1984, cer-

39a

tifying as final appealable orders the determination of

liability and the judgment for actual damages, pursuant

to Rule 54(b) of the Federal Rules of Civil Procedure.

The Circuit, however, held that this Court’s judgment

was not a final judgment under 28 U.S.C. § 1291. Miller

v. Cudahy, No. 85-1450 (10th Cir., unpublished, January

31, 1986).

Because of the Circuit’s ruling, the defendants’ motion

for a new trial pursuant to Rule 60 was procedurally

premature. Therefore, on February 10, 1986, they filed

a motion for an evidentiary hearing to revise and amend

the findings of fact and conclusions of law issued by this

Court on August 13, 1984, or, in the alternative, for a

new trial, pursuant to Rule 54(b) of the Federal Rules

of Civil Procedure. They seek essentially the same relief

sought in their earlier new trial motion. This motion

was filed only to restate, on procedurally correct grounds,

their request for that relief. Defendants in that motion

incorporate by reference all of their earlier “new trial”

filings. Therefore, the Court will consider the two mo-

tions and their progeny filings together.

B. Standards for Motions for New Trial or To Revise

and Amend

1. Federal Rules of Civil Procedure

Rule 54(b) provides as follows:

Judgment Upon Multiple Claims or Involving Multi-

ple Parties. When more than one claim for relief is

presented in an action, whether as a claim, counter-

claim, cross-claim, or third party claim, or when

multiple parties are involved, the court may direct

the entry of a final judgment as to one or more but

fewer than all of the claims or parties only upon an

express determination that there is no just reason

for delay and upon an express direction for the en-

try of judgment. In the absence of such determina-

40a

tion and direction, any order or other form of deci-

sion, however designated, which adjudicates fewer

than all the claims or the rights and liabilities of

fewer than all the parties shall not terminate the

action as to any of the claims or parties, and the

order or other form of decision is subject to revision

at any time before the entry of judgment adjudicat-

ing all the claims and the rights and liabilities of ail

the parties. (emphasis added).

It is clear that under this Rule the Court retains the

power to alter decisions until final judgment is made in

a ease. Paramount Pictures Corp. v. Thompson Thea-

tres, 621 F.2d 1088, 1090 (10th Cir.1980) ; United States

v. Desert Gold Mining Co., 433 F.2d 713, 715 (9th Cir.

1970). But the real question is not if the Court can alter

rulings, but whether the Court should. While Rule 54(b)

implicitly allows revisions, it does not address under

what circumstances or for what causes such revisions

should be made. Considering that this action was a trial

to the court and not to a jury, the Court finds that in

this instance a motion to alter or amend is essentially

a motion for a new trial. Therefore the Court finds that

its consideration of this issue should also be governed by

Rules 59 and 60 of the Federal Rules of Civil Procedure,

which provide in relevant part:

Rule 59. New Trials; Amendment of Judgments

(a) Grounds. A new trial may be granted to all or

any of the parties and on all or part of the issues

. (2) in an action tried without a jury, for any

of the reasons for which rehearings have heretofore

been granted in suits in equity in the courts of the

United States. On a motion for a new trial in an

action tried without a jury, the court may open the

judgment if one has been entered, take additional

testimony, amend findings of fact and conclusions of

law or make new findings and conclusions, and di-

rect the entry of a new judgment.

4la .

(b) Time for Motion. A motion for a new trial

shall be served not later than 10 days after the entry

of judgment.

Rule 60. Relief from Judgment or Order

(b) Mistakes; Inadvertence; Excusable Neglect;

Newly Discovered Evidence; Fraud, etc. On motion

and upon such terms as are just, the court may re-

lieve a party or his legal representative from a final

judgment, order, or proceeding for the following rea-

sons: ... (2) newly discovered evidence which by

due diligence could not have been discovered in time

to move for a new trial under Rule 59(b);... (6)

any other reason justifying relief from the operation

of the judgment. The motion shall be made within a

reasonable time. ...

Because defendants timely filed a new trial motion

following the August, 1984 entry of judgment, and be-

cause the instant motion was filed within ten days of the

Circuit’s ruling, the Court finds that none of defendants’

motions now under consideration are time barred. Be-

cause this action was tried to the Court, a'l motions are

being considered in conjuiction for the relief the defend-

ants seek, procedural distinctions aside. Motions for new

trial and for reconsideration are closely related, so the

movants should be granted whatever relief their motion

shows them entitled to. United States Gypsum Co. v.

Schiavo Brothers, Inc., 668 F.2d 172 (8rd Cir. 1981),

cert. denied, 456 U.S. 961, 102 S.Ct. 2038, 72 L.Ed.2d

485 (1982). The Court notes that defendants’ new trial

motion of August 12, 1985, sought relief pursuant to

Rules 60(b) (2) and 60(b) (6).

2. Case Law

Motions for new trials, relief from judgment, or to

alter or amend the court’s findings and conclusions are

directed to the discretion of the court. Allied Chemical

|

42a

Corp. v. Daiflon, Inc., 449 U.S. 33, 36, 101 S.Ct. 188,

190, 66 L.Ed.2d 193 (1980); Clarke v. Burkle, 570 F.2d

824, 830 (8th Cir. 1978); Kargman v. Sullivan, 582 F.2d

131, 135 (1st Cir. 1978); Ope Shipping, Ltd. v. Under-

writers at Lloyds, 100 F.R.D. 428, 431 (S.D.N.Y. 1983).

The standard of review for a district court’s decision on

these matters is abuse of discretion. Howard D. Jury,

Inc. v. R & G Sloane Mfg. Co., Inc., 666 F.2d 1348, 1852

(10th Cir. 1981); Washington Mobilization Committee v.

Jefferson, 617 F.2d 848, 850 (D.C. Cir. 1980). Motions

seeking new trials or relief from judgments on the basis

of newly discovered evidence seek extraordinary relief

and will be granted only in exceptional circumstances

when the requirements are strictly met. Such motions

are disfavored. Dabney v. Montgomery Ward & Co.,

Ine., 692 F.2d 49, 52 (8th Cir. 1982), cert. denied, 461

U.S. 957, 103 S.Ct. 2429, 77 L.Ed.2d 1316 (1983) ;

Goland v. Central Intelligence Agency, 607 F.2d 339, 370

(D.C. Cir. 1978), cert. denied, 445 U.S. 927, 100 S.Ct.

1312, 63 L.Ed.2d 759 (1980); Link v. Mercedes-Benz of

North America, Inc., 618 F. Supp. 679, 693 (E.D. Pa.

1985), aff'd in part, vacated in part, 788 F.2d 918 (3rd

Cir. 1986); Swift Chemical Co. v. Usamex Fertilizers,

Inc., 490 F. Supp. 1348, 1350-51 (E.D. La. 1980), aff'd,

646 F.2d 1121 (5th Cir. 1981), rehearing denied, 650

F.2d 282 (5th Cir. 1981); Wilson v. Fonte, 82 F.R.D.

632, 634 (E.D. Pa. 1979).

The law is well settled that to reopen trial proceedings

for newly discovered evidence, three requirements must

be met. First, the evidence must have existed at the time

of trial, but not have been known to the movant. Second,

the evidence must be such that it could not have been dis-

covered in time to present it at the original proceedings

by the exercise of due diligence. And third, the evidence

must be such that it would probably have produced a

different outcome had it been presented initially. Branca

v. Security Benefit Life Insurance Co., 789 F.2d 1511

43a

(11th Cir. 1986); Equal Employment Opportunity Com-

mission v. Rath Packing Co., 787 F.2d 318, 331 (8th Cir.

1986), cert. denied, U.S. , 107 S.Ct. 307, 93

L.Ed.2d 282 (1986); Hoyt R. Matise Co. v. Zurn, 754

F.2d 560, 568 n.14 (5th Cir. 1985); Ope Shipping, Ltd.;

100 F.R.D. at 432; Champion Spark Plug Co. v. Gyromat

Corp., 88 F.R.D. 526 (D. Conn. 1980), aff'd 636 F.2d

907 (2d Cir. 1981). These three factors will govern the

Court’s consideration in this case.

For this matter, the Court would particularly empha-

size two of those factors. Of preeminent concern in eval-

uating defendants’ “newly discovered evidence” is whether

that evidence, by the exercise of due diligence, could have

been discovered in time for trial. A judgment may not

be set aside, or in this case modified or amended, on the

grounds of newly discovered evidence where that evidence

is the tvpe which with due diligence the defendants could

have discovered in time for the original trial or proceed-

ing. Mus’e Research, Inc. v. Vanguard Recording Soci-

ety, Inc., 547 F.2d 192 (2nd Cir. 1976).

Even if the evidence is such that it could not by due

diligence have been discovered, to support a motion for

a new trial the evidence must be material to the issues

and must be of such a nature that it would probably

change the outcome. Stridiron v. Stridiron, 698 F.2d 204

(3rd Cir. 1983). While this factor is most generally ap-

plied to exclude evidence that is merely cumulative or

impeaching in nature, it goes beyond that. New evidence,

even if genuinely new and material, regarding a relevant

aspect of the trial subject matter and regarding an issue

that was not presented at the trial or that would have

cast evidence presented at trial in a significantly differ-

ent light, does not thereby automatically warrant a new

trial. Instead, the Court must look at the new evidence

in light of the total evidence presented at trial. Where

the weight of the evidence presented at trial is so over-

whelmingly in support of the initial verdict that the in-

—————_

44a

troduction of this new evidence, probative and significant

though it may be, would still not have changed the fina]

outcome, then a new trial is not justified. “The strength

or weakness of the evidence against the defendant is an

important and often decisive factor in judging the new

evidence supporting a motion to vacate, because the fun-

damental purpose of the Rule 60(b) motion is to prevent

the judgment from becoming a vehicle of injustice.”

United States v. Walus, 616 F.2d 283, 288 (7th Cir.

1980).

In a matter that was tried to a jury, the Court per-

haps must be careful in making such a determination as

to the outcome altering nature of this new evidence, and

give the movant the benefit of any doubt. But in a mat-

ter such as this which was tried to the Court, the Court

can assess even the closer questions, and if it determines

that the introduction of this newly discovered evidence,

viewed in the best possible light, would still not have

changed the verdict as to liability or damages, then it

need not order that a new trial or hearing be held.

C. Newly Discovered Evidence: Proffered

In light of these standards governing the exercise of

the court’s discretion as to whether to grant a new trial

or hearing to alter or amend its original] findings of fact

and conclusions of law, the Court will now review the

proffered “newly discovered evidence.” Defendants as-

sert that this evidence is relevant to punitive damages,

equitable relief, liability and actual damages; in short,

to everything. The Court will not add to the already

lengthy nature of this opinion and order by reviewing

the exhaustive findings and conclusions made initially in

its Opinion, reported at Miller v. Cudahy Co., 592 F.

Supp. 976 (D. Kan. 1984).

Defendants offer a Wealth of new evidence, which the

Court shall attempt to arrange in some form of topical

grouping. The Court is repeating here only the evidence

Ee

45a

proffered by defendants. It should be emphasized that

this recitation is not to be taken as the Court’s acceptance

of these “facts” as proven. Plaintiffs have not had an

opportunity to conduct discovery of their own on these

issues, nor to cross examine defendants’ reports. Should

a new trial or hearing be held the facts found there may

differ from this proffer. The Court only examines de-

fendant’s “new evidence” to determine if, taking all of

their assertions as true, the evidence would warrant a

new trial.

Nefendants assert that their testing has revealed sey-

eral hitherto unknown aspects of the aquifer. Among

these are that the rate of groundwater flow and recharge

rate is much slower than was believed at trial. Addi-

tionally, defendants have discovered that sodium pollu-

tion, rather than chloride pollution, from the brime pre-

sents the major obstacle to an environmental cleanup.

Due to a phenomenon known as the Sodium Adsorption

Ratio [SAR], the pollution will take much longer to

clear. The problem presented by SAR is that the clay

particles surrounding the aquifer absorb sodium from the

polluted water, then, after all of the polluted water will

have hypothetically passed and clean water is flowing

through the aquifer, the clay would release sodium into

that water, repolluting the water. Because of this, it is

not sufficient for all of the presently polluted water to

flow through the area (assuming no further pollution, an

assumption not warranted by any facts at this time) ;

instead, two to three times that amount of water must

flow past the sodium laden clay in order to thoroughly

“rinse” out the pollution. Because the aquifer is moving

much slower than originally believed, and because much

more water will be required to flow through the aquifer

to cleanse ii than originally believed, defendants assert

that the aquifer would not naturally cleanse itself of the

salt plume in twenty to thirty years as Suggested at trial.

In fact, defendants Suggest to this Court that it would

OO

46a

take two to three hundred years for such a cleansing to

occur!

As a corollary to the reduced recharge rate of the

aquifer, defendants assert that the aquifer, even in an

unpolluted state, would not support irrigation by all of

the plaintiffs. They direct the Court’s attention to the

recently reduced irrigation permit allowances by the Big

Bend Groundwater Management District. Under these

restrictions, plaintiffs could not all obtain permits to ir-

rigate the affected land even if good water existed. De-

fendants further assert that, had plaintiffs all been ir-

rigating, in light of the aquifer’s low recharge rate the

aquifer would have been severely mined by now, and

perhaps permanently damaged. Defendants further as-

sert that more accurate mapping of the plume has re-

vealed that some of the plaintiffs’ land is not even af-

fected by the underground water pollution, and that some

of the plaintiffs’ land has access to good water for irriga-

tion. Defendants assert that these facts go to the actual

damages awarded at trial.

Defendants allege to have discovered ancther plume

“upstream” from this one, emanating from an old Carey

salt mine. Although this plume does not now join with

the plume which is the subject of this dispute, defendants

attempt tc imply that the plumes may once have been

connected ‘without explaining how they could have once

been connected and are not now, since both flow in the

same direction). Defendants therefore assert that Ameri-

can Salt may not be solely to blame for the instant plume.

They further assert that the pumping of one of their

wells is preventing this plume from spreading further,

and congratulate themselves for this without showing

that it has any relevance to the present suit.

Defendants assert that recent testing has shown that,

contrary to the finding made by this Court following

trial, their brine fields are not leaking. The Court would

47a

note that plaintiffs hotly dispute this “finding,” as they

did at trial. As will be demonstrated below, evidence

offered during the remedial phase of this case, not the

least of which was from Kansas Department of Health

and Environment, continues to support the Court’s origi-

nal finding that the brine fields have been leaking and

are continuing to leak.

Defendants assert that, based on the slow flow rate of

the aquifer and the presence of an intercept well on their

property, any chlorides that escape from the plant will

be (and have been) intercepted before they reach the

aquifer lying under any of the plaintiffs’ land. There-

fore, they are not now causing any pollution to plaintiffs’

property.

These are the meat of defendants’ proffered “new

evidence.” Again the Court would emphasize that this

“evidence” has not been subjected to plaintiffs’ scrutiny,

and the facts are therefore not proven facts. The Court

will now evaluate them in light of the earlier listed stand-

ards for granting a new trial motion.

D. Newly Discovered Evidence: Evaluated

1. Groundwater Management District’s Permit Re-

quirements

Initially, the Court dismisses consideration of the re-

cently revised Big Bend Groundwater Management Dis-

trict’s permit requirements. That revision occurred after

the trial in this matter, and as such did not exist at th

time of trial. “Compelling policies of finality require

that in the absence of exceptional circumstances, events

occurring after a trial on the merits cannot justify the

reopening of a judgment.” County of Trinity v. Andrus,

77 F.R.D. 29, 30 (E.D. Cal. 1977). Defendants argue

that this rule does not apply here because the revised

regulations only reflect the realities of the aquifer, reali-

ties which existed at the time of trial. The Court will

48a

consider the “newly discovered” aquifer characteristics

shortly. The Court notes, however, that at trial one of

the factors considered in the damage award was that

plaintiffs could have obtained permits to irrigate but for

the fact that the water was unsuitable for irrigation

(Kansas law does not allow a permit to be granted for

irrigation unless it will actually be put into use; where

the water cannot be used, as here, no permit will be

granted solely for that reason).

Had plaintiffs in fact been given irrigation permits and

begun to irrigate, and had such irrigation in fact so

seriously threatened the aquifer as to cause the ground-

water management district to take action, the Court

cannot speculate on what action the Groundwater Man-

agement District would have taken. It is possible that

they would have revoked some of the farmers’ irrigation

permits, but it is just as possible that they would have

revoked some of American Salt’s water permits, espe-

cially since American Salt holds the lion’s share of the

area’s permits. The fact remains that, at the time of

trial, plaintiffs could have obtained permits for irriga-

tion if not for the pollution. That permit requirements

were later changed so that, today, they could not obtain

such permits even were the water pure, is immaterial.

2. Ancillary Motion to Revise or Amend: Lost Crop

Profits

The Court should note at this point that defendants

disagree with some of the assertions just made regarding

plaintiffs’ ability to obtain irrigation permits. They have,

in fact, filed a “Motion to Revise or Amend the August

13, 1984 Opinion to Dismiss the Claims for Lost Crop

Profits of those Plaintiffs Who Have No Water Permits

to Irrigate Their Lands.” Dk. no. 697. This motion to

revise or amend is separate from the motion to revise

or amend which the Court has been discussing (Dk.

no. 604), and from the motions for New Trial, or

in the alternative, to Revise or Amend which defendants

49a

have filed previously (Dk. nos. 526, 462). Defendants

assertion in the instant motion, Dk. no. 697, is that the

plaintiffs, with the exception of three who had secured

water permits, cannot recover for lost crop profits due

to their inability to irrigate because they had no permit,

and therefore no legal right, to irrigate.

Defendants present the Court with a detailed review

of Kansas law on water rights. They assert that plain-

tiffs could have acquired a “vested right” to water prior

to July 1, 1980, if they had made “continuous applica-

tion for water for beneficial use since on or before June

28, 1945.” Dk. no. 697, p. 5, citing K.S.A. § 82a-701(d).

Of course, as this Opinion has previously demonstrated,

pollution of the water which prevented any beneficial use

has existed since well before 1945. Defendants unsur-

prisingly do not mention this. They also-assert that

plaintiffs could have acquired an “appropriation right”

through the permitting process. Defendants do not ac-

tually deny that use of the water is necessary to obtain

and maintain a permit. They do assert with great

aplomb that neither state law or groundwater manage-

ment district rules and regulations “require a water

quality test as a condition for obtaining a permit.” Dk.

no. 697, p. 6. They further suggest that all plaintiffs

needed to have done was file an application and obtain

a permit while water rights were still available and then

timely request extensions for perfecting the permit, i.e.,

putting the water to beneficial use. Defendants assure

the Court that plaintiffs could have obtained an excep-

tion to the rule that water rights not used for three con-

secutive years are forfeited, base upon a showing of due

and sufficient cause (pollution). By following these steps,

defendants conclude, “!p]laintiffs would thereby have

secured their right to use the water as soon as it was

clean.” Dk. no. 697, p. 10. Of course, these are the same

defendants who initially suggested to plaintiffs and to

this Court that the water would not be clean for two

50a

hundred years. See V. REMEDIAL ACTION PLANS,

infra.

From a theoretical standpoint, plaintiffs may have been

able to obtain some type of water permits by following

the contorted process defendants suggest. But this in-

teresting legal theory has no application to the real world

in which plaintiffs live. They are landowners, not bar-

risters. They only wish to spend their time farming, not

engaging in the testing of novel legal theories. State

agencies such as the Big Bend Groundwater Management

District and the State Board of Agriculture, Division of

Water Resources have suggested to the Court that one

could not obtain a permit for water unless he actually

were to use the water. See Transcript of June 2, 1986

hearing, pp. 46, 50. Of course, this water is unusable.

If this interpretation by the state agencies is not tech-

nically correct, assuming without deciding that defend-

ants’ suggestion is a theoretical possibility, the plaintiffs

are not to be faulted for relying on that understanding.

Plaintiffs did not seek water permits because they could

not use the water, even if they had permits. To conclude

therefore that they are estopped or precluded from re-

ceiving damages for their inability to irrigate is inequita-

ble; it turns the law on its head. Speaking of the Kansas

Water Appropriation Act, the Kansas Supreme Court

said:

Under this declaration and other provisions of the

act we now approach [questions concerning water

rights] upon the basis of the interest of the people

of the state without losing sight of the beneficial use

the individual is making or has the right to make of

the water. Unused or unusable rights predicated

alone upon theory become of little if any importance.

State, ex rel., Emery v. Knapp, 167 Kan. 546, 555, 207

P.2d 440 ‘1949) (emphasis added). Defendants’ sug-

gested course of conduct may make sense in an Alice-in-

Wonderland world; it makes no sense in ours.

5la

Further, plaintiffs demonstrate that defendants’ inter-

vening cause argument—that the intervening cause of

the failure of plaintiffs to obtain water permits for irri-

gation precludes their right to recover for loss of irri-

gated crops due to the pollution—is fatally flawed. De-

fendants’ argument presupposes that there is no relation-

ship between the pollution and the failure of plaintiffs

to obtain permits. But testimony received has demon-

strated that plaintiffs have not applied for or received

permits because the pollution prevented use of the water.

The failure to obtain permits is not a cause of plaintiffs’

inability to irrigate; both the inability to obtain permits

and the inability to irrigate are a result of defendants’

pollution of the aquifer. Evidence from plaintiffs and

state officials has suggested, and the Court so finds, that

it would have been futile for plaintiffs to apply for irri-

gation permits so long as the water was unfit for irriga-

tion. Therefore, plaintiffs failure to apply for permits is

excusable and does not bar their recovery for lost crop

profits.

Defendants argue that plaintiffs’ claim of futility is

“totally spurious because the filing of a permit applica-

tion is not ‘futile’ but a requisite first step to obtaining a

water right.” Dk. no. 697, p. 10. This argument is non-

responsive. Filing of a permit application is a requisite

first step to obtaining a permit, but when other cir-

cumstances will bar the issuance of a permit, and those

circumstances are known initially, the filing for a permit

becomes both a requisite first step and a futile act. Plain-

tiffs’ futility argument is not totally spurious, but de-

fendants’ tortuous dance around the law and the facts is.

Defendants’ motion regarding lost crop profits is de-

nied. Plaintiffs’ inability to obtain water permits aug-

ments their claim against defendants: it does not bar

it. That Big Bend has subsequently revised the allow-

able amount of water permits availab’e due to discover-

ing the reduced aquifer recharge rate likewise does not

52a

bar plaintiffs’ action against defendants. Any difficulties

which plaintiffs might encounter now in seeking to obtain

water permits is immaterial to their previous failure to

apply for permits. They did not apply when permits

were available because defendants’ pollution prevented

permits from being obtainable. The reduced permit al-

lowances are not properly considerable as “‘newly dis-

covered evidence,” and do not operate as a bar to plain-

tiffs request for damages against defendants. The Court

will now examine the remaining proferred newly dis-

covered evidence.

3. Due Diligence

The remaining ‘newly discovered facts” all seem to

be of the nature of facts that did exist at the time of

trial. Regarding these, defendants boldly assert that

these facts are practically conclusive in themselves, and

chide the Court that ‘“[t]he only reasonable solution is

for the Court to recognize that the real facts are the

facts, regardless of when they were discovered.”’ Dk. no.

605, p. 5. Defendants cite no authority for this proposi-

tion, which is hardly surprising since, despite the appeal-

ing sound of the assertion, there is no authority for that

statement as constituted. Even assuming that these

“facts” could survive plaintiffs’ scrutiny and emerge un-

seathed as the “real facts,” and even assuming that these

“real facts’? were indeed conclusive in and cf themselves,

that is hardly the starting point in a motion for a new

trial or a motion to alter and amend the court’s findings.

Instead, the initial question must be, could these alleged

facts have been discovered by defendants’ exercise of due

diligence in time for the trial? Or, put another way, how

many of these alleged facts could defendants not have

discovered in time for trial, as opposed to how many

they did not discover?

Defendants certainly did not lack for time. This case,

filed nearly ten years ago, was in discovery for seven

53a

years before it was finally called to trial. Instead, it

is very clear to this Court, which has watched the tortuous

course of this case unfold, that defendants made a policy

or strategy decision not to test the aquifer, not to in-

vestigate the complaints, not to inspect the damage; in

short, to do nothing but ignore the entire matter. This

course of inaction was followed despite requests by

KDHE to test, and despite fines and the threat of further,

more serious action by KDHE. It was done despite the

pendency of this suit, and despite the surdid history

spanning a haif a century of complaints by neighboring

land owners and state agencies regarding pollution. De-

fendants’ strategy was to pooh-pooh the allegations that

they were polluting and to pretend that there was noth-

ing to be alarmed about. Considering that this was the

company line not only for the seven years of discovery in

this ease, but for the fifty years of plant operation, the

Court will not now hear them say that they could not

have discovered what the “real facts” of the aquifer were

until after this suit. They made a conscious decision not

to investigate the “real facts.’”” They must now live with

that decision.

Defendants deny that they had seven years to investi-

gate this matter. They instead plead that they had no

reason to look for this type of evidence until this Court’s

order of June 21, 1983, Miller v. Cudahy Co., 567 F.Supp.

892 (D.Kan.1983). Defendants pretend that the 1983

order “radically altered” this litigation. Dk. no. 527, p.

95. The Court’s opinion of this claim of “surprise” is

unprintable. The only thing that was radically altered

by the 1983 order was that defendants were finally dis-

abused of their notion that their beloved statute of limita-

tions defense was the panacea to all their legal prob-

lems. As previously mentioned, defendants believed (or

hoped) that their “prescription by pollution” theory would

prevail; that if they polluted the environment long

enough, it was theirs; and that they could not be called

54a

to account for what they did to it. The Court’s 1983

order refused to accept this base proposition. It is ap-

parent to the Court that defendants continue to hold

fast to this favorite son principle; but this Court con-

tinues just as strongly in its abhorrence to that line

of defense.

In fact, the “radical change” wrought in this matter

by the 1983 order was not so radical as to suddenly re

quire testing of the aquifer to determine the damage

done, whereas before none had been required. This action —

was brought initially alleging pollution of the aquifer,

and damage to the plaintiffs’ ability to irrigate as a

result thereof. While there were varying arguments of

permanent or temporary damages, which the 1983 order

resolved, by no reasonable legal theory could the pre-

resolution of that matter be regarded as putting the case

in a posture where the condition of the aquifer which

was alleged to be polluted was immaterial to the case.

Even were the Court to accept defendants’ proposition

that the defendants did not know it was necessary to test

the aquifer until after the 1983 order, the Court could

still not find that defendants are excused from not dis-

covering this evidence prior to trial; that they could not

have discovered it with the exercise of due diligence.

The order “radically altering’ the case was handed down

on June 21, 1983. The case was called for trial on

March 26, 1984, nine months later. Defendants contend

that these nine months were insufficient to conduct the

necessary discovery. They admit that they did not seek

a continuance for the purpose of obtaining sufficient time

to conduct this suddenly necessary investigation, but seek

to excuse their failure on that account by complaining

that the Court would not have allowed another extension

in this already protracted matter then anyway. Whether

the Court would have granted or denied a motion for con-

tinuance to allow additional discovery is speculative; what

is certain is that defendants did not request continuance.

55a

If, as they claim, the 1983 order had indeed “radically

altered” the course of this litigation, then seeking such

a continuance would have been a natural, almost neces-

sary, consequence. That they did not then seek such a

continuance is perhaps indicative of the fact that they

did not then truly believe that the litigation had been that

altered. At any rate, the Court finds it passing strange

that, after seven years of discovery defendants were too

concerned about the protracted nature of the suit to seek

an extension of a few months; but now after ten years of

proceedings, they are not so concerned but that they seek

a new trial, which would cause at least another year of

activity at the district level.

Moreover, the Court is unpersuaded that those nine

months were so fleeting as to not warrant even begin-

ning an investigation. The Court handed down its judg-

ment in this case on August 13, 1984. On September 11,

1984, a status conference was held with the parties con-

cerning the development of a remedial investigation. At

that time it was envisioned that the results of this in-

vestigation would be presented to the Court by April

1985, as ordered in the August ruling (‘a final report

. shall be filed with the Court within eight months

of the date on which this Opinion and Order is filed.”

592 F.Supp. at 1009.). Although the defendants now

plead that the nine months between the 1983 order and

the commencement of trial were too brief to warrant

even beginning an investigation, they did not complain

the next year when instructed to complete an entire

remedial investigation within eight months. In fact, the

development of the investigation later required them to

seek extensions of time, but their final four volume re-

port was filed with the Court on November 20, 1985,

fourteen months after the status conference.

Thus, even if the Court were to accept defendants’

argument that testing of the aquifer was not required

until after the 1983 order, and even if the Court were to

56a

accept defendants’ excuses for not seeking an extension

of time in which to complete this testing, the Court could

still not find that defendants were excused from the due

diligence requirement to discover the facts prior to trial.

Even then, sufficient time existed to begin an investiga-

tion. Defendants instead chose not to investigate. What

their strategy was, whether hoping for an appellate

resurrection of the “prescription by pollution” theory, or

whether fearing that any facts uncovered could only hurt

their cause, the Court can not divine. But it is painfully

clear that the defendants, without excuse, made a deci-

sion not to investigate the damage to the aquifer. Not

until forced by the Court, under threat of a ten million

dollar punitive award, did they begin a remedial investi-

gation. If the facts of that investigation have yielded

evidence they believe would have been helpful at trial,

that is unfortunate for them. “[D]efendant’s desire to

introduce additional evidence after losing the case [does]

not constitute a proper ground for granting a new trial.”

Brown v. Wright, 588 F.2d 708, 710 (9th Cir.1978).

Adopting defendants’ theories would insure that no

case was ever final; a party could drag its discovery out

piecemeal and thereby require continual retrials. Even

if it had no hope of winning, it could hope to wear its

opponent down. Indeed, it is not surprising that defend-

ants have attempted this approach; American Salt

threatened plaintiffs years ago that if suit was filed

“the money and lawyers available to American Salt would

enable it to drag any litigation out for years, bankrupt

[the plaintiffs] in the process, and take [their] land.”

Miller, 592 F.Supp at 996. That threat has come close

to becoming a reality. The disparity of resources between

the parties has been a constant problem in this suit. It

has resulted in the defendants being able to make volu-

minous filings of briefs, argument and research far in

excess of what the plaintiffs can match. “The defendants

have seemingly limitless resources for the filing of writ-

57a

ten motions, memoranda, etc., in this case; their resources

for so doing are far greater than those of the plaintiffs

and their attorneys.” Dk. no. 609, p. 2. At recent hear-

ings, plaintiffs’ counsel has made it clear that her clients

have severely limited, for financial reasons, what addi-

tional legal] action she could take.

The Court is sympathetic to the plight of the plaintiffs,

who, though small farmers, have been forced to pay the

costs of this action for ten years and have so far gained

no remuneration from it. Any additional delays sought

by the defendants must be balanced against the increas-

ing chance that rising costs to the plaintiffs may force

them to abandon their action, especially in light of de-

fendants’ earlier threat to do just that. This Court will

not tolerate that type of litigation strategy. The Court

finds that there was ample opportunity to discover this

evidence during the years of discovery, and that de-

fendants’ failure to do so warrants a denial of their

motion now. McClean v. Alexander, 449 F.Supp. 1251,

1263 (D.Del.1978), rev’d on other grounds, 599 F.2d

1190 (3rd Cir.1979).

Due diligence going to a new trial motion is a factual

determination. The Court finds that had defendants ex-

ercised due diligence, they could have discovered this evi-

dence in time for trial. Their failure to exercise dili-

gence requires that their new trial/relief from judgment

amend findings of fact and conclusions of law motions

be denied.

4. Outcome Altering E ffect of New Evidence

Although not necessary to the resolution of defend-

ants’ motions, the Court further determines that, even

had defendants exercised due diligence, their motion

would not be granted. This Court sat as the fact finder

in the original proceedings and heard the wealth of evi-

dence presented there over the course of thirty-three days

of trial. The weight of evidence against the defendants

and in support of the final verdict was overwhelming.

58a

Examining the proffered ‘new evidence,” even without

benefit of plaintiffs’ critique, the Court is persuaded that

nothing is proffered which would have changed the verdict

as to liability or punitive damages. The evidence could

only possibly go to actual damages. While recognizing

that the Tenth Circuit’s order in this case leaves the

entire verdict, including actual damages, open to revision,

this Court considered the actual damages phase of the

suit to be over when the trial concluded in May of 1984.

Nothing defendants have shown the Court now persuades

it that its decision was wrong, or that the case should be

reopened.

5. Due Process Considerations

Defendants warn the Court that an evidentiary hear-

ing must be held because it would “avert any due process

problems which might arise if the Court failed to afford

the parties herein the opportunity to fully and fairly

develop and present the evidence which has been dis-

covered.” Dk. no. 605, p. 6. The Court agrees more with

plaintiffs, who remind us that despite defendants’ “deep

rumblings” about due process, due process is governed

by the rules and authorities with which this Court has

already evaluated defendants’ motions.

Due process does not require that parties be allowed

to present any evidence that they want to, at any time,

regarding any subject matter, in complete disregard to

the established rules of evidence and civil procedure. It

only requires that the party suffering a loss be given an

opportunity to be heard “at a meaningful time and in a

meaningful manner.” Goldberg v. Kelly, 397 US. 254,

267, 90 S.Ct. 1011, 1020, 25 L.Ed.2d 287 (1970). To

suggest that this Court has not afforded defendants a

meaningful opportunity to be heard is laughable. In

addition to a very lengthy trial, numerous hearings have

been held in this matter, some of them as long as a

normal trial. At each of these hearings, defendants

59a

have been given fuil opportunity to present evidence and

to examined plaintiffs’ evidence (the sole exception being

the very last hearing held in this matter at which neither

plaintiff nor defendant were allowed to present evidence,

but where the Court received in open court the reports

of state agencies’ evaluations of the proposed plans).

Literally thousands of pages of memoranda have been filed

by defendants. The Court has noted at some of these

hearings that, if anything, this case was being “due

processed to death.” For the defendants to suggest now,

after ten years of activity, months of trial time, and

volumes of pleadings that due process is being denied

them is perhaps one of the most outlandish claims this

Court has ever heard. If this matter has any problems,

denial of due proces certainly is not one of them.

6. Any Other Reason for a New Trial

In addition to seeking relief pursuant to Rule 60(b)

(2), “newly discovered evidence,” defendants also seek a

new trial pursuant to Rule 60(b) (6), “any other reason.”

This rule is not an open ended invitation to seek a new

trial for any reason, but is only designed to allow the

Courts to do justice when equity demands, but the Rules

otherwise do not provide authorization. This rule is espe-

cially “not a substitute for a motion for a new trial,

particularly when it is grounded upon evidence which

could have been discovered and timely presented through

the exercise of due diligence.” Inter Financing Exchange

S.A. v. Bartlett & Co., Grain, 659 F.2d 1320, 1321 (5th

Cir.1981). No other reason has been shown to the

Court why a new trial or the functional equivalent is

warranted. Therefore, application of this Rule is not

justified.

A motion for new trial is an extraordinary request,

directed to the discretion of the Court. Defendants have

not begun to meet their burden of demonstrating that

the proceedings should be reopened. The Court has not

60a

been shown that justice requires it. Indeed, justice re-

quires that plaintiffs not be caused to pay for defend-

ants’ conscious decisions not to investigate earlier. The

motions shall be denied.

IV. COSTS, EXPENSES AND FEES

On February 6, 1986, plaintiffs filed a motion for the

award of Costs, Expenses and Fees incurred in conjunc-

tion with the remedial phase of this case (Dk. no. 602).

Thev filed an itemized list of expenses for which they

sought reimbursement. Receipts verifying most of the

expenses for such reimbursement were attached to their

motion. Because the case was in the midst of the remedial

hearings at that time, the Court postponed ruling on

plaintiffs’ motion, anticipating that any expenses of that

nature which they had incurred they were likely to con-

tinue incurring. This presumption has proven accurate.

Plaintiffs filed addendums to that motion, setting out

additional like expenses incurred, on Apri] 23, 1986 (Dk.

no. 654); May 5, 1986 (Dk. no. 658); and May 9, 1986

(Dk. no. 659). The categories of expenses for which re-

imbursement is sought are transcripts, witness fees (in-

cluding those expenses denominated as “Subpoena” in

Dk. no. 659), laboratory expenses, expert expenses, tele-

phone expenses, copying expenses, postage, attorneys’

travel expenses and attorneys’ fees.

A. Background

Before discussing the relevant merits of each requested

item, the Court first emphasizes the unique nature of the

proceedings which resulted in these expenses. All costs

requested are for post trial proceedings, unlike the vast

majority of reported cases dealing with costs which in-

volve pretrial expenses only. The development and presen-

tation of various plans that defendants have offered has

proven to be a complicated and controversial matter, as this

opinion will discuss later in some detail. The plaintiffs

— »§

6la

have incurred substantial additional expense in the course

of this matter: post trial filings made have been nearly

as voluminous as the pretrial filings (which themselves

ran into hundreds of docket entries and thousands of

pages). The Court has attempted to make it clear

throughout the long and contentious course of this re-

medial phase that the plaintiffs had already won the case,

and that the Court felt that they should not be further

penalized or prejudiced by post trial hearings or expenses

collateral to defendants’ development of the remedial ac-

tion plan. Neither plaintiffs’ verdict nor their damages

were in jeopardy during these proceedings; both had been

established during trial at considerable expense to the

plaintiffs—expenses for which they do not seek reimburse-

ment. This portion of the case could not gain for them

any additional benefit; it was not a hearing to determine

the amount of damages, but only to determine the form

which the damages might take. If any side stood to gain

from these proceedings, it was not the plaintiffs, but the

defendants, whose damages might be remitted in part due

to their remedial efforts if equity justified it.

Moreover, the Court cannot ignore the economic dis-

parity between the parties. Defendants are divisions of a

large, multi-corporate entity; plaintiffs are merely local

landowners/farmers. This disparity may have been ir-

relevant during the trial of the action plaintiffs them-

selves brought, but it is a valid consideration in a phase

where plaintiffs have won the trial and the form of

damages itself is the only consideration. The Court recog-

nizes that defendants’ expenses during this phase of the

proceedings have been substantial and have far exceeded

the plaintiffs’ costs; but the Court also recognizes that

defendants are more able to afford the expense than plain-

tiffs are, and that these proceedings are only for the

benefit of the defendants. With these considerations in

mind, the Court will now make the following determina-

tions.

62a

B. Statutory Authority to Tax Costs

The Court is authorized in its discretion to tax certain

costs against the defendants pursuant to 28 U.S.C. § 1920.

Among these are fees of the court reporter for transcripts

and witness fees for nonparty witnesses. These fees the

Court taxes against defendants.

The remaining categories of expenses the Court char-

acterizes into the following groups: Attorneys’ fees (in-

cluding both fees and attorney travel expenses); dis-

covery costs (including telephone expense, copying and

postage) ; and expert fees (including laboratory expenses

and expert fees). The Court will discuss them seriatim.

C. Discovery Costs

The discovery costs sought by plaintiffs are not spe-

cifically authorized by any statute as costs which may be

awarded. Discovery costs normally are not recoverable,

as defendants point out, citing a previous opinion of this

Court. Miller v. City of Mission, 516 F.Supp. 1333, 1339

(D.Kan.1981) (quoting Quandt v. Beech Aircraft Corp.,

No. W-4464 (D.Kan., unpublished, Apr. 24, 1981)). Like

other such costs, though discovery costs may be taxed in

certein circumstances. Worley v. Massey-Ferguson, Inc.,

79 F.R.D. 534 (N.D.Miss.1978). The Court is granted a

certain amount of discretion on such items pursuant. to

Rule 54(d) of the Federal Rules of Civil Procedure.

which provides: “Except when express provision therefor

is made either in a statute of the United States or in

these rules, costs shall be allowed as of course to the

prevailing party unless the court otherwise directs. .. .”

While the discretion granted the Court pursuant to this

statute normally only applies to statutory items, see 28

U.S.C. § 1920, the Court in its discretion may also award

non-statutory costs which were reasonably incurred.

Schmid v. Frosch, 609 F.Supp. 490, 492 (D.D.C.1985).

It is not surprising that the taxing of items such as

postage, copying and telephone calls have not been clearly

63a

settled by statute, rules or case law. The Court has found

instances in which such items were all taxed, see, e.g.,

Zeffiro v. First Pennsylvania Bank, N.A., 574 F.Supp.

443, 449 (E.D.Pa.1983), on reconsideration, 581 F.Supp.

811 (E.D.Pa.1983), aff'd 746 F.2d 1465 (3rd Cir.1984) ;

and instances in which all items were all not, see, e.9.,

Keith v. Volpe, 501 F.Supp. 4038, 415 (C.D.Cal.1980).

Other examples abound of either allowing these types of

expenses, see, e.g., Lenard v. Argento, 699 F.2d 874, 900

(7th Cir.1983), cert. denied, 464 U.S. 815, 104 S.Ct. 69,

78 L.Ed.2d 84 (1983); Clark v. Marsh, 609 F.Supp.

1028, 1035-36 (D.D.C.1985); Davis v. Reed, 72 F.R.D.

644 (N.D.Miss.1976); or of not allowing these types of

expenses, see, e.g., Wahl v. Carrier Manufacturing Co.

Inc., 511 F.2d 209, 216-17 (7th Cir.1975); Zdunek v.

Washington Metropolitan Area Tronsit Authority, 100

F.R.D. 689, 692 (D.D.C.1983); Morrison v. Alleluia

Cushion Co., Inc., 73 F.R.D. 70 (N.D.Miss.1976). Since

the Court has just cited examples on both sides of the

question from the same courts, it should be apparent that

there is no hard and fast rule governing awards of these

costs. Instead, the governing rule seems to be the dis-

eretion of the Court. Mikel v. Kerr, 499 F.2d 1178, 1183

(10th Cir.1974); Welsch v. Likens, 68 F.R.D. 589, 595

(D.Minn.1975), aff'd 525 F.2d 987 (8th Cir.1975). The

Court’s discretion is based on the ancient practice of

equity. County of Suffolk v. Secretary of Interior, 76

F.R.D. 469, 473 (E.D.N.Y.1977), cert. denied, 434 U.S.

1064, 98 S.Ct. 1238, 55 L.Ed.2d 764 (1978). In equity,

the Court is empowered to do what should be done to

set things right. In consideration of the unique situation

of this matter, as set out in the introduction to this sec-

tion, the Court finds geod cause to exercise its equitable

discretion to tax these costs against the defendants.

D. Attorneys’ Fees

The Court next examines plaintiffs’ request for at-

torney fees. It has been established beyond contraven-

64a

tion that the American Rule is that a prevailing litigant

is not normally entitled to collect attorney fees from the

loser. Alyeska Pipeline Service Co. v. Wilderness Society,

421 U.S. 240, 247, 95 S.ct. 1612, 1616, 44 L.Ed.2d 141

(1975). The Supreme Court has made clear that this is

not only the prevailing rule, but it is a ule to which the

courts should not make exceptions without “legislative

guidance.” Zd.; Christiansburg Garment Co. v. Equal

Employment Opportunity Commission, 484 U.S. 412, 415,

JS 5.Ct. 694, 697, 54 L.Ed.2d 648 (1978).

There are a few established exceptions to this rule,

Which are also universally recognized. The most common

exception is that attorney fees are awardable when Con-

gress has specifically authorized the award by statute,

or they are otherwise awardable pursuant to contract or

agreement. Runyon v. McCreary, 427 U.S. 160, 185, 96

S.Ct. 2586, 2601, 49 L.Ed.2d 415 (1976); Paramount

Pictures Corp. v. Thompson Theatres, Inc., 621 F.2d

1088, 1091 (10th Cir.1980). They can also be awarded

When the losing party brought or defended the action in

bad faith or vexatiously. Rutledge v. Sunderland, 671

F.2d 377, 382 (10th Cir.1982): Kahan v. Rosenstiel, 424

F.2d 161, 167 (3rd Cir.1970), cert. denied, 398 U.S. 950,

90 S.Ct. 1870, 26 L.Ed.2d 290 (1970). None of these

exceptions apply here.

There is also discussion suggesting that this rule may

not apply in a diversity case. Alyeska Pipeline, 421 U.S.

at 209, n. 31, 95 S.Ct. at 1622 n. 31. This exception is

fashioned to allow enforcement of a state law which re-

flects a “substantial policy of the state.” Jd. Although

the diversity issue was raised here, Kansas has no such

state law or policy.

Plaintiffs also advance the “private attorney genera]”

concept to support their request for fees in this instance.

This theory supports awarding the prevailing parties

such costs when they brought the action to benefit the

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public at large and without any large financial incentive

of their own. Wilderness Society v. Morton, 495 F.2d

1026 (D.C.Cir.1974). The application of this concept is

strictly limited. It should not be used merely to jettison

the traditional rule against the non-statutory award of

attorneys fees to prevailing parties whenever a court

determines that policy considerations support the award.

Alyeska Pipeline, 421 U.S. at 263, 95 S.Ct. at 1624.

Some Circuits have expressly rejected the “private at-

torney general’ concept supporting an award of attorney

fees, finding that Alyeska Pipeline preempted that theory.

Huecker v. Milburn, 538 F.2d 1241, 1246 (6th Cir.1976) ;

Skehan v. Board of Trustees of Bloomsburg State College,

538 F.2d 53, 59 (3rd Cir.1976), cert. denied, 429 USS.

979, 97 S.Ct. 490, 50 L.Ed.2d 588 (1976). Construing

that concept narrowly, the Court cannot find that it

justifies an award of attorneys fees in this case. Plain-

tiffs did bring this action seeking clean water, but the

water they sought to clean up was all under their own

land. It cannot be said that plaintiffs brought this action

without any substantial economic incentive on their own.

They sought and were awarded substantial actual and

punitive damages.

In its previous discussion dealing with discovery costs,

the Court relied in part on the provision of Rule 54(d)

of the Federal Rules of Civil Procedure to support an

award of those costs to the plaintiffs. Rule 54(d) does

give the Court broad discretion, but it does not encompass

the award of attorney fees. The American Rule is too

well established to allow the Court’s discretion to be

stretched that far. Pigeaud v. McLaren, 699 F.2d 401

(7th Cir.1983).

Having considered all exceptions to the American Rule

which might possibly be applicable, the Court finds that

none warrant awarding attorneys fees to plaintiffs. The

Court further finds that equity does not demand that

attorneys fees be awarded in this particular instance.

Therefore, this portion of their motion must be denied.

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KE. Experts’ Fees

The last requested item for which plaintiffs seek in-

demnification is their expert expenses. The general rule

regarding the recovery of experts’ fees is somewhat anal-

ogous to the American Rule regarding attorneys’ fees:

they generally are not recoverable insofar as they exceed

the statutory amount authorized for witnesses in general.

Miller v. City of Mission, 515 F.Supp. 1333, 1340 (D.Kan.

1981). However, this rule is not nearly as inflexible as

the attorneys’ fees rule; indeed, some courts have held

that it was an abuse of discretion for the trial court not

to award expert fees in full. Coleman v. City of Omaha,

714 F.2d 804, 809 (8th Cir.1983) ; Roberts v. S.S. Kyri-

akoula D. Lemos, 651 F.2d 201 (8d Cir.1981). Obviously,

then, the award of experts’ fees cannot be completely

analogized to the American Rule, but requires more of a

factual analysis by the Court.

The Court notes initially that case language exists

which would suggest that experts’ fees are never taxable.

Ramos v. Lamm, 713 F.2d 546, 559 (10th Cir.1983).

See also Illinois v. Sangamo Construction Co., 657 F.2d

855, 865 (7th Cir.1981); Bosse v. Litton Unit Handling

Systems, 646 F.2d 689, 695 (1st Cir.1981); Jones v. Dia-

mond, 636 F.2d 1364, 1382 (5th Cir.1981), overruled by

International Woodworkers of America, AFL-CIO v.

Champion International Corp., 790 F.2d 1174 (5th Cir.

1986) (recognizing three narrow exceptions to the gen-

eral rule); Ott v. Speedwriting Publishing Co., 518 F.2d

1143, 1149 (6th Cir.1975).

A review of caselaw in full has persuaded the Court

that the law is actually broader than such language may

suggest. While the general rule is that such fees are not

taxable, exceptions to that rule abound. Courts are al-

lowed to award expert fees in their equitable discretion

when the expert is court appointed, or when the Court

finds that the experts’ testimony was crucial and indis-

pensable to the resolution of the case. Nebraska Public

67a

Power District v. Austin Power, Inc., 773 F.2d 960 (8th

Cir.1985) (awarding expert fees pursuant to Federal

Rule of Civil Procedure 54(d)); Cagle v. Cox, 87 F.R.D.

467, 471-72 (E.D.Va.1980) ; Worley v. Massey-Ferguson,

Inc., 79 F.R.D. 534, 540-41 (N.D.Miss.1978) ; Welsch 1

Likins, 68 F.R.D. 589, 596-97 (D.Minn.1975), aff'd, 525

F.2d 987 (8th Cir.1975). See also 10 Wright, Miller &

Kane, Federal Pratice and Procedure: Civil <a 5 2668

This doctrine has also been recognized in tig circuit.

Bruno v. Western Electric Co., 618 F.Supp. 3%8 | D.Colo.

1985); Keyes v. School District No. 1, 439 F.Supp. 393

(D.Colo.1977). The Court finds the Keyes case especially

apposite to this case. There the Court found an award of

expert witness fees justified despite the usual rule be

cause the expert’s testimony was indispensable to estab-

lishing the claim and determining the plan.

Defendants argue to the Court that plaintiffs cannot

rely on the “court-appointed expert” doctrine to justify

an award of expert fees in this case because the Court

expressly denied a motion by plaintiffs for a court ap-

pointed expert on February 25, 1986. Dk. no. 624. That

order needs to be viewed in context. Plaintiffs’ motion

(Dk. no. 560) specifically sought the appointment of

independent experts” or “special consultants.” The Court

denied that motion upon a finding that ‘“|a]t this time,

. . plaintiffs’ and defendants’ experts are adequately

developing the issues.” The Court also reserved the right

to reconsider this matter later, if necessary. The Court

never found it necessary to reconsider that decision, re-

maining convinced that the experts active in the case

were doing an adequate and sufficient job. One of those

experts was Dr. Dan Raviv, ‘plaintiffs’ expert.” The

Court has previously indicated both in its written opin-

ions (Miller, 592 F.Supp. at 999) and in its courtroom

comments, that it found Dr. Raviv to be highly credible.

When the Court initially ordered the defendants to

investigate potential cleanup alternatives, it ordered them

68a

to do so “in consultation with an expert to be designated

by the plaintiffs, and possibly an additiona' independent

expert to be selected by the Court... .” Jd. at 1009.

The later order of this Court denying plaintiffs’ motion

for a court appointed expert must be understood in that

light; what the Court declined to do was to select the

additional independent expert. The expert designated by

the plaintiffs, Dr. Raviv, was involved in the remedial

action phase by specific order of this Court, and his in-

volvement was not affected by the Court’s later order.

In this context, it is apparent that Dr. Raviv was not

only a court appointed expert, but he was no longer

‘plaintiffs’ expert.” Defendants were required by this

Court to work with him in developing their plan. De-

fendants admit, albeit rather grudgingly, that Dr. Raviv

did work with them in the development of the plan. Dk.

no. 634, p. 5. This Court’s own observation of the de-

velopment of defendants’ plans (see discussion on Reme-

dial Action Plans infra,) convinces it that Dr. Raviv

was involved throughout. In fact, the final plan pre-

sented to the Court by defendants was largely the re-

sult of Dr. Raviv’s suggestions. Defendants suggest that

Raviv’s involvement was insignificant in comparison to

that of “their” experts, Paul Roux and Leonard Eder.

That assertion is doubtless correct, but it is immaterial to

the disposition of this issue.

Therefore, as Dr. Raviv was in reality ‘defendants’

expert” for the purpose of the remedial action phase of

this case—that is, he was an expert defendants were

required to and did consult in their plan development—

it is not only equitable to require them to pay his fees,

but it is to be expected. The Court is convinced that this

case, with its unusual post-trial phase which could only

benefit the defendants, is one of those unusual circum-

stances which case law indicates would justify the award

of expert fees. The facts of the post-trial activity of this

case which the Court had previously detailed clearly sug-

69a

gest that equity would require defendants to pay for

plaintiffs’ expert fees for the devclpment and review of

defendants’ proposed remedial action plans. But the

Court finds that it is not necessary to reach the analysis

of whether this case is such a case justifying the unusual

award of expert fees against the losing party. Its initial

opinion required defendants to consult an expert desig-

nated by plaintiffs during this phase. It should come as

no surprise now that defendants are responsible to pay

for the expert consultations which they received. The

Court finds that all of Dr. Raviv’s fees and expenses in-

curred in connection with the post-trial remedial action

phase of this suit are properly taxable to the defendants.

The Court notes that plaintiffs’ request for expert fees

encompasses more than fees paid to Dr. Raviv. They also

seek reimbursement for expenses incurred with the follow-

ing “experts”: Clarke Well and Equipment, Charles Wil-

son, Curtis Miller, and John Peck. These appear to make

up less than one-fourth of their total requested expert

fees, the balance all being fees billed by Dr. Raviv. The

Court is not clear what role these other “experts” are

alleged to have played in the development of the remedial

action phase of this case. Two things are clear to the

Court: their use was nct initially authorized by the Court

(only one expert was, and that clearly has been Dr.

Raviv), and since the Court is unaware of what these

“experts” even did, it cannot be said that their testimony

or activity was indispensable to the resolution of this case.

Therefore, the Court finds that none of their fees are

properly taxable to the defendants.

Plaintiffs also have requested reimbursement for cer-

tain “lab fees” which the Court has characterized as part

of their request for expert fees. Their motion does not

make clear for what purpose these lab fees were incurred.

If they were incurred pursuant to Dr. Raviv’s work with

defendants’ experts in developing the plans, then they are

properly taxable to the defendants. If they were not so

70a

incurred, then they are not taxable to the defendants.

Having said that, the Court is constrained to add the

qualification that, if any of Dr. Raviv’s fees were in-

curred for any reason not directly related to the develop-

ment of the plan, such as testimony in support of one or

more of plaintiffs collateral motions, then such fees may

not be taxed to the defendants.

In summary, the Court finds that the following costs

are properly taxable to the defendants: transcripts, wit-

ness fees, copying expenses, postage, long distance tele-

phone expenses, and all fees billed by Dr. Raviv in con-

nection with his work on defendants’ development of a

remedial action cleanup plan, including any lab fees re-

lated to that work. The following requested costs are not

taxable to the defendants: attorneys’ fees, attorneys’

travel expenses, and all expert fees and lab fees not in-

curred pursuant to Dr. Raviv’s work on defendants’ de-

velopment of their remedial plans. Because the Court has

divided up the allowable and nonallowable expenses in a

different fashion than plaintiffs did in their requests, the

Court orders that plaintiffs submit within twenty days

from the date of this order a revised statement of costs,

itemizing all post-trial costs for which the Court has

authorized recovery. This statement should include ex-

planation or justification of the purpose for which the

fees were incurred, when necessary. Should defendants

have any reason within the scope of this order to object

to this statement of costs, they may file their objections

within ten days of the date of plaintiffs’ filing.

V. REMEDIAL ACTION PLANS

Despite what the lengthy preceding portions of this

ruling might suggest, the Court only now comes to the

issue for which it retained jurisdiction over this matter:

consideration of remedial cleanup alternatives. Because

so much time has elapsed since the Court initially or-

dered the remedial cleanup investigation, and since so

T1la

many (mostly erroneous) assertions have been made dur-

ing that time about why the Court made this order, what

its intents and purposes were in doing so, and what type

of cleanup was envisioned by the Court and the parties

at that time, the Court will review the context in which

this order was made before discussing the development of

the case during the remedial phase.

A. Preluninary Motions

Before the Court can address the question of the

remedial action plan, it finds once again that it must

first dispose of some procedural motions. This it will

do in short order.

1. Motion to Strike the Affidavit of Elly Triegel

As the Court has mentioned before, the “motion to

strike” is a favorite in this case. The Court has typically

denied such motions, assuring the parties that because

this matter is being tried to the Court, it will be able

to dismiss from consideration any impermissible asser-

tions.

This motion is slightly different, though. Plaintiffs

move to strike the affidavit submited by defendants be-

cause it deals only with the cleanup, and was filed well

beyond the deadline imposed by the Court for filing any-

thing regarding the plans. See Dk. no. 655 (Order of

the Court dated April 23, 1986 imposing a deadline of

May 23, 1986, for filings from either side concerning the

remedial cleanup plan, and stressing that no later filings

would be considered by the Court). The Court has al-

ready held plaintiffs to this order. See Dk. no. 668. De-

fendants do not deny that the affidavit was late (it was

filed on July 28, 1986), nor that it deals only with the

cleanup. Instead, they rather cavalierly suggest that it is

clear that the deadline was not an absolute deadline,

and that the Court itself did not even adhere to it (citing

an irrelevant example).

72a

The Court’s order meant what it said. The affidavit

was filed untimely. In the interests of fairness and im-

partiality it must be struck. Plaintiffs’ motion is granted.

2. Motion to Strike Status Report

Another motion to strike. This time plaintiffs seek to

strike a status report filed by defendants regarding vari-

ous projects at the salt plant, on the ground that it in-

cludes information plaintiffs should have been given

earlier, but were not. If plaintiffs’ assertion is true, the

appropriate remedy is not to strike the report. The Court

need not discuss this matter further, except to cite it as

yet another example indicative of the ongoing disputes

between the plaintiffs and the defendants. The motion is

denied.

3 Motion to Preclude Consideration of Non-eviden-

tiary Matters

Defendants move for an order “precluding from consid-

eration as evidence . .. the unsworn communication of

non-parties, including letters and statements, where the

non-parties have not been subject to cross examination

..., to the extent these statements make representations

of fact.” Dk. no. 698, p. 1. Defendants’ concern here is

with the communications from state agencies which were

solicited by the Court. In particular, they seem concerned

with an “absurd representation” made in a June 20, 1986

letter from Big Bend. Defendants were especially con-

cerned with their inability to cross examine the Agencies

at the June 2, 1986 hearing, to which they objected at

the time. Plaintiffs suggest that the defendants are being

a bit schizophrenic; on the same day in which defendants

filed this motion they filed another motion in which they

relied in part upon the testimony of one of the agencies

representatives at one of the hearings.

The Ccurt does not find the defendants’ actions as

inconsistent as plaintiffs suggest. Defendants are only

asking that the communications not be considered to the

73a

extent that they make representations of fact. The Court

certainly did not solicit the agencies comments so that it

could ignore them. But the Court will not consider as

evidence any representations by the agencies which goes

to the disputed facts of the suit. The Court will consider

their submissions solely for the reasons they were solici-

ted: as they relate to the agencies involvement in any

proposal before the Court, the agencies’ administration of

their own duties and responsibilities imposed by state

law, and their technical review of the proposed plans

from their standpoint of involvement. The Court does

not see the defendants as objecting to consideration of

these types of factors, and since the Court is not consider-

ing or relying on the Agencies’ representations as to any

disputed facts or other than as stated above, the Court

concludes that it must be granting defendants motion.

Therefore, upon this understanding, defendants’ motion

is granted.

B. Reasons for the Remedial Cleanup Investigation

Order

On August 13, 1984, this Court issued its “final rul-

ing” in Miller v. Cudahy Co., 592 F.Supp. 976 (D.Kan.

1984). The Court found for the plaintiffs, awarded them

$3,060,000.00 in actual damages, and $10,000,000.00 in

punitive damages. Evidence had been received at trial in

response to a Court inquiry which suggested that a clean-

up of the aquifer might be technologically and scientifi-

cally feasible. The Court considered that possibility to

be the preferable remedy for this matter, and therefore

desired to pursue that option.

The Court finds that it would be beneficial to refer to

its original Conclusions of Law, from the August 13, 1984

Opinion and Order, regarding the Court’s purpose in

ordering the defendants to pursue this option.

35. In the further exercise of its equitable juris-

diction, this Court concludes that substantial justice

74a

would best be worked between these parties if the

defendants could accomplish, at their own expense,

the removal of a substantial majority of the salt

from the aquifer. The removal of salt from the aqui-

fer would settle the most significant matter in con-

troversy between these parties, restore them to their

respective positions before the nuisance was created,

and prevent further biannual litigation of the mat-

ters of concern in this lawsuit. This Court has the

equitable power to order the defendants to undertake

such a clean-up.

36. At the present time, the Court is without suffi-

cient knowledge or information to order the defend-

ants to undertake any particular remedial program.

Additional work by competent experts is needed to

determine the existence, cost, efficacy, and feasibility

of the various clean-up strategies that are or may be

available to defendants. ...

37. Were the defendants to make a conscientious,

good-faith, and realistic effort to address and rem-

edy, within a reasonable time, the pollution presently

existing in the aquifer, such an effort would be

extremely relevant to this Court’s assessment of the

defendants’ state of mind and to the appropriateness

of the award of punitive damages that this Court

has found to be fully justified in this case. In the

exercise of its broad equitable powers, this Court

concludes that the ends of substantial justice would

best be served by holding the final judgment as to

the punitive damage award temporarily in abeyance,

pending the defendants’ good-faith efforts to define

and remedy the pollution they have caused. The

Court will retain jurisdiction over this case and the

punitive damage award to the fullest extent per-

mitted by law while the clean-up alternatives are

investigated and implemented, and may activate by

a final judgment the punitive damage award, in

75a

whole or in part, at any time that it becomes appar-

ent that the defendants are not pursuing the clean-up

effort in good faith, or at any time that it becomes

apparent that any clean-up effort is impossible for

either scientific or financial reasons.

Id. at 1007-1008.

Several things are worth noting regarding the Court’s

retention of jurisdiction during this remedial action

phase. First, as paragraph 37 makes clear, the Court

only retained jurisdiction over the punitive damage

award. The fact that the Circuit Court has declined to

review the matter until all parts of the case are final

does not change the finality, in this Court, of its findings

of liability and actual] damages. The Court has been

frustrated throughout the last half of this remedial

action phase by the defendants’ constant efforts to retry

these issues. This Opinion has dealt with this problem

previously and will not rehash it here.

Second, the Court retained jurisdiction to allow the

development of a remedial action plan for equitable

reasons only. The defendants have insinuated that the

Court is obligated to remit the punitive damages in whole

if defendants develop and implement any cleanup plan.

This is a gross mischaracterization of the Court’s order.

The Order is clear (paragraph 37) that only a “conscien-

tious, good-faith, and realistic effort” to address the prob-

lem would be considered, and that it would only be con-

sidered as “relevant to this Court’s assessment of the

defendants’ state of mind and to the appropriateness of

the award of punitive damages” that the Court had im-

posed. In short, an appropriate amount of punitives

would be remitted only if the Court was convinced,

through the development and implementation of a plan,

that the defendants’ goodfaith effort to clean up the

aquifer which they had polluted demonstrated that the

$10,000,000.00 punitive damage award was not justified.

76a

Further, the Order is also clear that the Court retained

the fullest power over the punitive damage award pos-

sible, including the power to activate the punitive dam-

age award in whole or in part if it became apparent that

the remedial effort was not being pursued in good faith

or was not feasible. The Court most definitely did not

give the defendants the option of choosing between paying

the punitive damage award or implementing a cleanup

plan of their choosing.

Third, the concept of a cleanup plan should be viewed

in the context of what was envisioned at the time of trial.

Brief testimony near the end of the trial was received

in response to Court inquiry that cleaning up the aquifer

might be feasible. Although this possibility was not de-

veloped in depth during the trial, it was the understand-

ing of all sides then that such a cleanup could be accom-

plished in a relatively short period of time. The Court

recalls a time span of five to fifteen years. Defendants

suggest that the time span then considered was six to

twenty years. Dk. no. 577, Vol. 1, p. 3. The difference

is not important; all sides agree that the time frame

contemplated then was considerably shorter than the ones

considered now. In part, the much abbreviated time

frame was based on a faulty belief by all sides that, if

all pollution ceased, the aquifer would naturally cleanse

itself in thirty years. These original time frames have

proved to be off by as much as a factor of ten to twenty,

as will be discussed below. When interpreting the Court’s

initial order, discussions of feasibility must be viewed

in the light of what was understood at that time. The

Court’s order that the defendants make an effort to rem-

edy the pollution “within a reasonable time,” paragraph

37, must also be understood within this context.

Finally, defendants were required to proceed in good

faith. Plaintiffs have suggested to this Court that almost

every action which defendants have taken was not in

good faith. Although the August 13, 1984 Opinion makes

77a

clear that this Court had serious concerns about defend-

ants’ motivations and attitudes, the Court is not prepared

to adopt plaintiffs’ sweeping accusations. This does not

mean, however, that the Court has been pleased with

defendants’ conduct throughout the course of this reme-

dial action phase. The highly contentious spirit between

the parties, which at times almost precluded the conduct

of orderly and productive hearings, has continued un-

abated. Fault for this lies on both sides. But as the

Court will demonstrate, the defendants’ conduct in the

development of the plans proposed and their aggressive

use of remedial action investigation to make collateral

attacks on the final judgment of this Court are all rele-

vant to good faith, and will be so considered. The Court

will now review the development of the remedial action

plans which were presented to this Court in light of the

reasons for which the remedial action stage of this case

was originally ordered.

C. Development of the Remedial Action Plans

1. 200 Year Plan

The Court’s August 13, 1984 Order required the de-

fendants to begin investigation of cleanup alternatives

and to present their final report on the available cleanup

alternatives within eight months. Miller, 592 F.Supp. at

1009. A status conference was held the following month

to determine some parameters and guidelines for the con-

duct of the investigation, but thereafter the Court’s in-

volvement in the ongoing investigation was basically

limited to granting the defendants additional time in

which to present their final report. Because of this lim-

ited involvement, the Court was unprepared for the pro-

posal which defendants filed on November 20, 1985. This

“Proposed Remedial Action Plan for the Cow Creek

Aquifer” was a four volume report consisting of a pro-

posed remedial action plan and seven appendices. Dk.

no. 577. For obvious reasons, the Court is forced to

78a

summarize the report, and for purposes of the developing

history of the series of plans which were to be filed, the

Court can summarize this report by extracting one sen-

tence from it: ‘We now know that the length of time

and the costs required to remediate the Cow Creek Aqui-

fer are much greater than previously thought.” Dk. no.

577, Vol. 1, p. 2. “Much greater” indeed, for as the Court

was shocked to learn, the defendants were proposing a

plan whcse duration was two hundred years! For the

Court, which was still thinking in terms of the five to

fifteen years envisioned at trial, this proposal of a plan

entirely as long as the history of this nation’s constitu-

tion was stunning.

In fairness to the defendants, the reason for the multi-

plication of plan length should be explained. The investi-

gation revealed two aspects of the aquifer which were

significantly different than originally thought. First, be-

cause the recharge rate of the aquifer was less than orig-

inally thought, see supra discussion on New Trial, the

rate at which water may be safely withdrawn from the

aquifer, as established by the Big Bend Groundwater

Management District, was relatively small. Being able

to withdraw less water from the aquifer increased the

time it would take to clean the aquifer. Big Bend later

informed the Court that it would permit the maximum

rate to be exceeded for purposes of a cleanup. As it ex-

plained, damage to the aquifer by “drawdown” (exces-

sive lowering of the water table in the aquifer due to

withdrawing too much water) was significant only as it

related to the inability of the aquifer water to be put to

beneficial use; but in its polluted state, the water had no

beneficial use.

The second way in which the aquifer differed from

what was originally believed is much more significant.

The defendants’ investigation discovered that removal

plans and indicators must be built around sodium rather

than chloride. The determinative factor was the sodium

79a

adsorption ratio [SAR], which the Court has discussed

briefly earlier. See supra III. New Trial. An SAR

reading of seven is the maximum level at which irriga-

tion can safely proceed. The aquifer had incredibly high

SAR readings, particularly in the center of the plume.

The SAR levels revealed by testing were so inconsistent,

both between wells and at individual wells at varying

times, as to preclude giving any meaningful average

or norm of SAK levels in the aquifer. Defendants’ report

lists the various readings at the various test wells. Dk.

no. 577, Vol. 1, Part C, Attachment C-1.

What makes the SAR such a problem is that absorption

of sodium onto the clay particles in the soil causes the

rate of sodium removal to lag behind the rate of chloride

removal. Put simply, the chlorides in the water can be

removed by withdrawing the chloride-contaminated water

from the aquifer and either purifying it for reinjection

into the aquifer, or disposing of it to allow pure water

to naturally recharge the aquifer. But once the chloride-

contaminated water is removed, the chlorides are also

removed. Sodium, on the other hand, attaches itself to

the clay particles in the soil surrounding the aquifer.

Therefore, if all of the sodium-contaminated water is

theoretically removed from the aquifer, sodium will still

remain in the clay. Then, when pure water recharges

the aquifer, this sodium will repollute the water. One

witness compared it to rinsing out a soapy sponge in a

clean bucket of water: one can fully saturate the sponge

and then squeeze it dry, but soap still remains. It takes

two or three “squeezes” to rinse the soap out. Sodium

works in a similar fashion. Defendants’ experts predicted

it would take two or three “rinses” to remove sufficient

sodium from the aquifer to lower the SAR of the water

to seven.

Because of the combination of these factors, defendants

estimated that the time necessary for the aquifer to

naturally clear itself was 190 to 240 years, rather than

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the 20 to 30 estimated at trial. Defendants also esti-

mated that, as a result of these factors, the costs of

remedial measures to accelerate the remediation process

to within less than 30 years would be _ between

$11,000,000.00 and $34,000,000.00 in capital costs, with

annual operating costs of $2,300,000.00 to $9,700,000.00.

Even then, defendants ominously intoned, there was “no

technical assurance or previous experience to indicate

that, in practice, these systems would meet their design

targets or that the theoretical acceleration in remediation

time could be achieved.” Dk. no. 577, Vol. 1, p. 4.

In light of these dire warnings, defendants then un-

veiled their plan. Briefly put, the plan involved five

steps: 1) eliminate potential sources of contamination;

2) control the further spread of contamination; 3) estab-

lish an ongoing monitoring program; 4) provide fresh

drinking water supplies to the affected homeowner popu-

lation; and 5) compensate landowners who cannot obtain

irrigation water from their land because of the

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