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Hostetler v. Johnson Controls Inc.

United States District Court, N.D. Indiana, South Bend Division

January 25, 2017

AMOS HOSTETLER, et al., Plaintiffs,
JOHNSON CONTROLS, INC., et al., Defendants.


          Michael G. Gotsch, Sr. United States Magistrate Judge.

         On August 15, 2016, Defendant, Johnson Controls, Inc. (“JCI”), filed its Motion for Entry of a Lone Pine Case Management Order. On September 15, 2016, Plaintiffs filed their Response in Opposition to JCI's instant motion for a Lone Pine order. JCI's instant motion became ripe on October 17, 2016, when JCI filed its relevant reply brief. For the reasons stated below, the Court denies JCI's motion. The Court also addresses case management deadlines in this case and the appointment of a Special Master for all discovery disputes.

         I. Relevant Background

         This a putative class action against JCI and Tocon Holdings, LLC (“Tocon”) arising out of alleged environmental contamination originated from a manufacturing plant in Goshen, Indiana operated by JCI from approximately 1937 through 2006 and then sold to Tocon in 2007. Plaintiffs contend that JCI's manufacturing process led to the discharge of hazardous chemicals, including trichloroethylene (“TCE”), into the ground contaminating groundwater and creating a contamination plume that migrated under the surrounding neighborhood. In 1997, JCI entered a Voluntary Remediation Agreement (“VRA”) with the Indiana Department of Environmental Management (“IDEM”) that established a remediation plan and obligated JCI to produce reports for public dissemination regarding their remediation efforts. When Tocon purchased the plant, they allegedly knew about the contamination, did nothing to stop it, and failed to warn residents of its dangers. Moreover, Tocon began demolition of the plant in 2013, which allegedly left debris on the property containing other hazardous materials such as asbestos, lead, mercury, and PCBs with no measures to prevent further contamination of the soil and groundwater.

         Claiming personal injury and property damage, Plaintiffs filed their complaint in this action in state court on May 30, 2014, asserting claims arising under state law against JCI and Tocon, including common law claims for trespass, nuisance, negligence, negligent infliction of emotional distress, and punitive damages along with a statutory environmental legal action claim. The complaint seeks compensatory and punitive damages from both defendants as well as an injunction requiring both defendants to remediate the contamination to non-detect levels.

         Litigation, including discovery, proceeded after the state court denied JCI's motion to dismiss.[1] On January 14, 2015, Plaintiffs filed a motion for class certification asking the Court to certify a class on the limited issues of liability and general causation. [DE 30 at 4]. On March 6, 2015, and at JCI's request, the state court continued its hearing on the motion for class certification until June 30, 2015, and simultaneously appointed Senior Judge Duffin as Special Master as to all discovery issues. [DE 11 at 8]. On April 20, 2015, JCI then filed a motion to compel asking the Court to order Plaintiffs to produce damages information in response to discovery requests that it arguably needed to prepare for the class certification hearing. [DE 178-30 at 3, 5]. The state court referred JCI's motion to compel to Special Master Duffin on April 21, 2015, [DE 11 at 8]. On May 5, 2015, once the motion to compel was ripe, Judge Duffin held a hearing on the motion (hereinafter “Duffin Hearing”).[2]

         In response to JCI's motion to compel, Plaintiffs argued that JCI's request for individual damages information, in the form of expert TCE dose and duration calculations, was premature because Plaintiffs' pending motion for class certification sought a liability-only class as the first phase of litigation to be followed by a damages phase, if necessary after the liability question was resolved. [DE 178-30 at 4-5]. In support, Plaintiffs cited to 7-Eleven, Inc. v. Bowens, 857 N.E.2d 382, 389 (Ind.Ct.App. 2006), in which the court approved of such a bifurcated approach to a similar environmental class action because “the trial court's certification of class as to the issues of liability and general causation is intended to reduce repetitious litigation and resolve the questions that can be applied to the class as a whole.”

         In addition, Plaintiffs contended that the damages information sought by JCI was irrelevant to the class certification hearing scheduled in the state court. [DE 178-30 at 5-6]. To rebut JCI's Rule 23 argument that none of the named Plaintiffs would be “typical” of the class they intend to represent or “adequate” class representatives, Plaintiffs relied upon Stoll v. Kraft Foods Glob., Inc., No. 1:09-CV-0364-TWP-DML, 2010 WL 3613828, at *5 (S.D. Ind. Sept. 6, 2010), in which the Southern District of Indiana rejected a parallel argument in another toxic tort case. See also Mejdrech v. Met-Coil Sys. Corp., 319 F.3d 910, 911 (7th Cir. 2003) (“Whether a particular class member suffered any legally compensable harm and if so in what dollar amount are questions that the judge reserved for individual hearings if and when [defendant] is determined to have contaminated the soil and water under the class members' homes in violation of federal or state law.”). As for commonality and efficiency, Plaintiffs cited Mejdreck v. Lockformer Co., No. 01 C 6107, 2002 WL 1838141, at *3 (N.D. Ill. Aug. 12, 2002), aff'd sub nom. Mejdrech., 319 F.3d 910 for the proposition that for class certification, “the characteristics of Plaintiffs need not be identical so long as there is a ‘common nucleus of operative fact.'”

         At the Duffin Hearing, and presumably in briefing its motion to compel, JCI cited multiple cases in which class certification was denied or summary judgment granted because the plaintiffs failed to produce sufficient evidence of individual damages, or specific causation. See Parko v. Shell Oil Co., 739 F.3d 1083, 1086-87 (7th Cir. 2014); C.W. v. Textron, Inc., No. 3:10 CV 87 PPS, 2014 WL 4979211, at *3-*6 (N.D. Ind. Oct. 3, 2014), aff'd but criticized sub nom. C.W. ex rel. Wood v. Textron, Inc., 807 F.3d 827 (7th Cir. 2015); see also Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 360 (2011) (holding that Fed.R.Civ.P. 23(b)(2) requires a class to share a common contention that is capable of class-wide resolution rather than different remedies for each class member). At the hearing, JCI's counsel also suggested that the state court judge had already held that Plaintiffs were required to complete discovery related to all the individual plaintiffs, presumably including their damages, by the discovery deadline in December 2015. [DE 29-1 at 3-4, 4:17-5:12].

         On May 28, 2015, before any final order was issued on JCI's motion to compel and before the class certification hearing was held, JCI removed the action to this Court. Plaintiffs promptly filed two motions to remand on June 26, 2015 [DE 21] and July 10, 2015 [DE 27]. At a preliminary pretrial conference on July 28, 2015, the Court consolidated the motions for remand, but refused to stay discovery noting that the Court would establish its own discovery deadlines and a briefing schedule for Plaintiffs' motion for class certification if the consolidated motion for remand were denied. [DE 32 at 2].

         At the same preliminary pretrial conference, Court proposed consolidating this case with its sister case, Schmucker v. Johnson Controls Inc., Cause No. 3:14-cv-1593-JD-MGG[3], “then bifurcating it to have discovery on liability only, leaving discovery as to class action and damages pending the Court's ruling on liability.” [DE 35 at 12-13]. In response to the Court's proposal, the parties presented the identical arguments regarding bifurcation that had been central to JCI's motion to compel before the state court. [DE 35 at 13-17]. As a consequence, the Court did not consolidate the two cases or reach any conclusion as to the propriety of bifurcation. [DE 32].

         On March 29, 2016, while the consolidated motion for remand was under advisement, the Court dismissed Plaintiffs' motion for class certification based on the parties' agreement that the remand issue should be resolved before any consideration of class certification. [DE 110]. Accordingly, the Court provided Plaintiffs leave to refile their motion for class certification after resolution of their consolidated motion to remand. [DE 110 at 1]. Discovery continued leading the parties to file competing discovery motions in an attempt to resolve disputes regarding JCI's failure to produce documents responsive to Plaintiffs' discovery requests on two issues. [DE 123, 129, 148, 162]. In addition, JCI filed its first motion for Lone Pine order seeking production of the damages information at issue its motion to compel in state court. [DE 166]. On July 11, 2016, the Court denied the consolidated motion to remand. [DE 167].

         With the motion to remand resolved, the Court denied without prejudice the pending discovery motions and JCI's original motion for Lone Pine order with leave to refile should the parties fail to resolve their disputes. [DE 171]. With parts of their disputes resolved, Plaintiffs filed three motions to compel and one motion for leave to file newly discovered evidence regarding one of the motions to compel. [DE 177, 184, 201, 204]. JCI filed the renewed motion for Lone Pine order at issue here on September 15, 2016. [DE 178]. JCI later filed a cross motion for protective order related to one of Plaintiffs' motions to compel. [DE 212]. None of Plaintiffs' pending motions nor JCI's pending motion for protective order address the issue of Plaintiffs' production of damages evidence as raised by JCI in its motion to compel before the state court.[4] Instead, JCI seeks production of that same damages evidence through its Lone Pine motion. The briefing of the current Lone Pine motion argues the same issues related to the timing and scope of class certification and bifurcation raised before the state court and Special Master Duffin in May 2015.

         II. Analysis

         A. Lone Pine Legal Standard

         Lone Pine orders are named after the 1986 environmental contamination case from which they originated. Lore v. Lone Pine Corp., No. L-33606085, 1986 WL 637507 ( N.J.Super. Ct. Law Div. Nov. 18, 1986). Lone Pine orders are case management orders, used typically in complex mass tort litigation, that require plaintiffs to produce prima facie evidence in support of their claims or risk dismissal of their case. Id. at *1-*3. While the Seventh Circuit has yet to address the proper role of Lone Pine orders, other circuits have and district courts within this Circuit have applied those principles.

         “The basic purpose of a Lone Pine order is to identify and cull potentially meritless claims and streamline litigation in complex cases involving numerous claimants, such as this one.” Baker v. Chevron USA, Inc., No. 105-CV-227, 2007 WL 315346, at *1 (S.D. Ohio Jan. 30, 2007). “In the federal courts, [Lone Pine] orders are issued under the wide discretion afforded district judges over the management of discovery under Fed.R.Civ.P. 16.” Acuna v. Brown & Root Inc., 200 F.3d 335, 340 (5th Cir. 2000) (affirming district court's discretion to manage complex tort litigation and the court's specific use of a Lone Pine order where “information regarding the nature of [the plaintiff's] injuries, the circumstances under which he could have been exposed to harmful substances, and the basis for believing that the named defendants were responsible for his injuries” were lacking in the plaintiff's complaint). Indeed, Fed.R.Civ.P. 16(c)(2)(L) explicitly permits the ...

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