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US law – Application of Lone Pine Order to mass tort claims following collision

 

17,300 meritless mass tort claims dismissed at the door by US court.

 

Copyright 2013, The Beaumont Enterprise. Reprinted with permission.

 

In a collision case involving the vessel  EAGLE OTOME,1 a US judge has recently thrown out nearly 17,300 claims, in a victory for Malaysian tank owner AET, which sought to dismiss an avalanche of claims filed by local residents who sought compensation but provided no evidence of harm following a three-way collision in the Sabine-Neches Waterway at Port Arthur Texas in 2010. A “Lone Pine Order” issued in the case required claimants to provide certain fundamental elements to support their claim, which they were not able to do.

History of the “Lone Pine Order”
The “Lone Pine Order” is a special case management mechanism, primarily used in mass-tort toxic claims, that requires plaintiffs to provide evidence to support a credible claim. Just filing the claim is not enough, and the claimant must prove the alleged damages were proximately caused by a particular event in question. This order gets its name from the case Lore v. Lone Pine Corp., where a suit was brought against the Lone Pine Landfill for loss of property value and personal injury caused by pollution from the Lone Pine grounds. After case management conferences, the court considered the following facts and information essential to support a plaintiff’s claim:

– Identity of the substance or chemical that caused the alleged injury.

– The specific disease, injury, or illness caused by the substance.

– A causal link between exposure to the substance in question and the alleged injury or property damage.

In this same manner, the Lone Pine Order issued in the case of the EAGLE OTOME required claimants to provide for the above fundamental elements to support their claim.

Facts of the EAGLE OTOME casualty and issuance of the Lone Pine Order
On 18th January 2010, the Singapore-registered oil tanker EAGLE OTOME, owned by AET, was en route to Sun Oil Terminal in Nederland, Texas carrying approximately 576,800 barrels of Olmeca crude oil. However, two days later the Master was notified that the Exxon Mobil facility would instead receive the vessel the next day and transit could be made to the facility in Beaumont, Texas by way of the Sabine-Neches Waterway.

On 23rd January 2010, while transiting the Sabine-Neches Waterway at Port Arthur Texas, a three-way collision occurred between the M/V EAGLE OTOME, M/V GULL ARROW, and M/V DIXIE VENGEANCE. The tankship EAGLE OTOME’s bow collided with the GULL ARROW’s starboard side and just seconds later, the barge KIRBY 30406, which was being pushed by the towboat DIXIE VENGEANCE, collided with the EAGLE OTOME. The force of this subsequent collision pierced the EAGLE OTOME’s hull and centre cargo tank, resulting in approximately 860,000 gallons of oil released and an estimated 460,000 gallons (11,000 barrels) of Olmeca crude oil spilled into the waterway. The damage to the EAGLE OTOME was estimated at USD 1.5 million. As a result of the incident, some of the vapours from the crude oil appeared to be spreading into downtown Port Arthur. As a precaution, local residents and businesses near the accident were notified and approximately 136 members of the community in an exclusionary zone were required to evacuate.

 

THE EAGLE OTOME: three-way collision.
Copyright 2013, The Beaumont Enterprise. Reprinted with permission.

 

Shortly after this, AET filed an instant action seeking to exonerate or limit its liability for any damages caused by this collision or as a result of the oil spill. According to Federal Rules of Civil Procedure, the court then approved a notice directing any individuals or entities claiming an injury related to the collision or oil spill to file a claim at Jack Brooks Federal Courthouse in Beaumont, Texas. After receiving this notice, over 21,000 claims came in from residents that believed they would be entitled to compensation by merely filing a claim. Legally, however, claimants must present evidence and prove that any injury they suffered was proximately caused by the collision or resulting oil spill.

Due to the unprecedented number of claims and the intricate and complex nature of this case, United States Magistrate Judge Keith Giblin issued a “Lone Pine Order” on 22nd March 2011, requiring all claimants to submit an expert affidavit linking the collision or oil spill to their alleged personal injury or property damage (with failure to comply with the Lone Pine Order resulting in possible dismissal of their claim). In response to the issuance of the order, certain claimants, referred to as the “Buzbee Claimants”, seeking exoneration, filed objections to Judge Giblin’s Lone Pine Order. The court did not agree with their arguments and found that they should be overruled and the Lone Pine Order was affirmed.

In April 2013, AET sought for dismissal of claimants who failed to submit any response to the Lone Pine Order and filed a First Amended Motion to Dismiss Noncompliant Claimants. Upon review of this motion, the court found that the motion should be granted, resulting in the dismissal and termination of 17,294 claims.

Types of claims requiring evidentiary support under the Lone Pine Order
The inordinate amount of claims filed as a result of the collision and/or oil spill in the EAGLE OTOME case included alleged:

– Personal injury sustained as a result of exposure to the oil spill.

– Personal injury sustained as a result of the collision between the three vessels, but not due to exposure to oil spill.

– Property damage as a result of the collision.

– Damages for business interruption sustained as a result of the collision.

– “Other” damages not of the types mentioned above.

Why the Lone Pine Order was instrumental in the EAGLE OTOME case
The issuance of the Lone Pine Order allowed for simplification of this complex and unusual case, streamlining of costs to both the claimants and the shipowner, conservation of judicial and legal resources that would have otherwise been spent in defending meritless claims, and aided the court in preparing a plan for trail of this high profile environmental case.

Conclusion
The basic purpose of the Lone Pine Order was to identify and remove potentially meritless claims from the thousands of claims filed, by requiring claimants to provide documentation establishing prima facie evidence of causation for their alleged damages. This was the case for AET and resulted in victory for them because it:

– Provided the defendants with an opportunity to dispose of meritless claims prior to spending a tremendous amount of money and financial resources during the discovery process.

– Permitted defendants to evaluate their case more accurately and decide how to move forward with the best potential result.

– Focused the attention of the case on the technical issues that are central to plaintiff’s causation burdens.

The Lone Pine Order proved to be an important factor as it expedited discovery, conserved judicial resources and facilitated the administration of the case. It will prove to be a useful mechanism to check meritless mass tort claims at the door in the future and could potentially be the solution for reinforcing the obligation of potential claimants to have a solid case before filing suit.

Footnotes
1In the Matter of the Complaint of AET Inc. Limited as Owner and AET Shipmanagement (Singapore) Pte Limited as Manager of the M/V EAGLE OTOME for Exoneration from or Limitation of Liability. § Civil Action No. 1:10-CV-51 (Eastern District of Texas), Order Filed on 4th February 2013.

 

 

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