Lone Pine Procedure Successful in Fracking Case
By Daniel J. Dunn, Anna K. Edgar, and Andrew C. Lillie – June 28, 2012
The authors served as counsel for defendants Antero Resources Corp. and Antero Resources Piceance Corp. in the case that is the subject of this article, along with James Thompson and Robert Schick of Vinson & Elkins LLP in Houston. The views expressed herein are those only of the authors and not of the parties involved.
Defendants in toxic-tort actions often face difficult and expensive challenges in defending claims by highly motivated plaintiffs in cases fraught with technical complexity and public controversy. This article concerns a recent case in which the defense pursued an unconventional case-management strategy that resulted in the complete dismissal of a case involving the natural-gas extraction process known as hydraulic fracturing (fracking).
More than almost any other type of case, toxic-tort cases are fundamentally dependent on expert testimony, particularly in the core areas of exposure, dose, and medical causation. Plaintiffs file many of these cases, however, without securing in advance expert assistance to ensure their claims meet minimum standards of scientific and legal acceptability. Nonetheless, liberal pleading requirements and the rules governing motions to dismiss and for summary judgment can prevent deserving defendants from achieving early dismissal of such claims. Moreover, toxic-tort cases are often exceedingly expensive to defend due to a host of factors, such as the need for multiple experts, the expansive time periods over which relevant events occurred, and the voluminous data and documents involved. And defendants at times face pressure to settle even the weakest claim to avoid the high cost and distraction of prolonged litigation.
The Lone Pine Procedure
The traditional judicial approach to case management can exacerbate these problems. Often, the plaintiff’s expert case is not disclosed until late in the process, after the conclusion of fact discovery and frequently the expenditure of years of effort and millions of dollars. Deferring expert evidence until completion of fact discovery may make sense in most ordinary civil cases. But in complex toxic-tort cases, where expert opinion is so fundamental and essential, reversing the traditional order can make better sense.
Many courts have done so, requiring the plaintiff to make a prima facie showing of exposure and causation through qualified expert opinion at the outset of the case, before expensive full discovery and other pretrial activities are allowed to proceed. Such orders follow Lore v. Lone Pine Corp., 1986 WL 637507 (N.J. Sup. Ct. Nov. 18, 1986). They have been used across the country in a variety of toxic-tort cases, from mass torts to claims of only a few plaintiffs, “to identify and cull potentially meritless claims and streamline litigation in complex cases.” Baker v. Chevron USA, Inc., No. 1:05-CV-227, 2007 WL 315346, at *1 (S.D. Ohio Jan. 30, 2007). See, e.g., Abuan v. Gen. Elec. Co., 3 F.3d 329, 334 (9th Cir. 1993); McManaway v. KBR, Inc., 265 F.R.D. 384, 385 (S.D. Ind. 2009); Acuna v. Brown & Root, Inc., No. SA-96-CA-543-06, 1998 WL 35283824, at *5–6 (W.D. Tex. Sept. 30, 1998), aff’d, 200 F.3d 335 (5th Cir. 2000); Wilcox v. Homestake Mining Co., No. CIV 04-534, 2008 WL 4697013 (D.N.M. Oct. 23, 2008), aff’d, 619 F.3d 1165 (10th Cir. 2010); Schelske v. Creative Nail Design, Inc., 933 P.2d 799, 802 (Mont. 1997); Bates v. Schneider Nat’l Carriers, Inc., 95 S.W.3d 309, 311 & n.3 (Tex. Ct. App. 2002), rev’d on other grounds, 147 S.W.3d 264 (Tex. 2004); Eggar v. Burlington N. R.R. Co., 1991 WL 315487, at *5 (D. Mont. Dec. 18, 1991), aff’d. sub nom. Claar v. Burlington N. R. Co., 29 F.3d 499 (9th Cir. 1994).
Typically, Lone Pine orders require plaintiffs to provide an expert affidavit by a specific date that states (1) the identity and amount of each chemical to which each plaintiff was exposed; (2) the precise disease or illness from which each plaintiff suffers; and (3) the evidence supporting the theory that exposure to the defendant’s chemicals caused the alleged injury. See McManaway, 265 F.R.D. at 385. In cases where the plaintiffs failed to make the required showing, courts have dismissed the claims with prejudice or summarily adjudicated them in the defendant’s favor, saving enormous resources and resulting in a just resolution of the dispute.
The Strudley Case
On May 9, 2012, the District Court for the City and County of Denver, Colorado, dismissed a personal-injury-and-property-damage-tort lawsuit brought by William and Beth Strudley and their family against Denver natural-gas company Antero Resources and two of its contractors, which had employed hydraulic fracturing in the completion of three wells within a mile of the plaintiffs’ home in Colorado’s Piceance Basin. See Order re Defendants’ Motion to Dismiss or for Summary Judgment, Strudley v. Antero Resources Corp., et al., 2011CV2218 (Denver Dist. Ct., May 9, 2012). One year earlier, on May 1, 2011, the Strudleys had filed their lawsuit, alleging claims for negligence, negligence per se, nuisance, strict liability, and trespass, and requesting compensatory damages, remediation costs, and medical-monitoring relief. They claimed that the defendants caused them unspecified “health injuries” by contaminating their air and water well with unspecified “hazardous gases, chemicals and industrial wastes.” They also alleged that the defendants’ operations caused a decrease in the value of their property, loss of quality of life, the need for medical monitoring, and other damages.
The plaintiffs’ allegations were extremely generalized and vague. The only paragraph in the complaint regarding personal injury obliquely referenced unspecified “personal and physical injuries, known and unknown.” The plaintiffs did not state what chemicals reached them, in what concentrations, or over what time period. They also failed to identify how the defendants’ operations allegedly caused their alleged exposure. The plaintiffs notably did not identify any current or future disease with which they were diagnosed or expected to be diagnosed, nor did they allege that any treating physician or qualified scientist had connected any such disease to the defendants’ operations.
The plaintiffs’ nearly 2,000 pages of initial disclosures made the absence of these specific allegations of exposure, injury, and causation even further suspect. The disclosures contained virtually nothing but the plaintiffs’ own descriptions of their alleged ailments. No documents identified the specific substances to which the plaintiffs allegedly were exposed, the duration of exposure, or when any such exposure occurred. Further, the disclosures contained no indication that any chemical associated with the defendants’ operations was even capable of causing the plaintiffs’ alleged injuries (general causation), much less actually caused any injury (specific causation).
By contrast, prior to the litigation, the agency that regulates oil and gas operations in Colorado tested the Strudley well and found “no data that would indicate the water quality in [the plaintiffs’] well has been impacted by nearby oil and natural gas drilling and operations.” Other evidence also undermined the plaintiffs’ accusations. For example, Antero submitted an affidavit showing it had shut in the three natural-gas wells at issue shortly after they were completed and never placed them into production. Another affidavit verified that the wells complied with applicable legal requirements. The affidavits also showed that the wells were equipped with state-of-the-art air-emissions technology and that prevailing winds blew away from the Strudley home.
Based on this and other information, the defendants asked the court in its discretion to require the plaintiffs to provide admissible evidence to warrant the considerable investment of time and resources associated with adjudication of a complex toxic-tort case. The court exercised its discretion to enter a modified case-management order (MCMO) under Colorado Rule of Civil Procedure 16. In the order, the court acknowledged the information the defendants had submitted and found that requiring the plaintiffs to produce admissible evidence concerning exposure and causation “may eliminate or sharply curtail this case.” The court then required the Strudley family to come forward with the following evidence, including expert opinion, within 105 days:
(i) Expert opinion(s) provided by way of sworn affidavit(s), with supporting data and facts in the form required by Colo. R. Civ. P 26(a)(2)(B)(I), that establish for each Plaintiff (a) the identity of each hazardous substance from Defendants’ activities to which he or she was exposed and which the Plaintiff claims caused him or her injury; (b) whether any and each of these substances can cause the type(s) of disease or illness that Plaintiffs claim (general causation); (c) the dose or other quantitative measurement of the concentration, timing and duration of his/her exposure to each substance; (d) if other than the Plaintiffs’ residence, the precise location of any exposure; (e) an identification, by way of reference to a medically recognized diagnosis, of the specific disease or illness from which each Plaintiff allegedly suffers or for which medical monitoring is purportedly necessary; and (f) a conclusion that such illness was in fact caused by such exposure (specific causation) . . . [and]
(iv) Identification and quantification of contamination of the Plaintiffs’ real property attributable to Defendants’ operations.
Plaintiffs’ Failed Showing
The plaintiffs submitted their response on February 23, 2012. Absent from the response was the information required by paragraph 9(a)(i) and (iv) of the order. As the court stated in its order dismissing the case:
Plaintiffs submitted a variety of maps, photos, medical records, and air and water sample analysis reports, together with the affidavit of Thomas L. Kurt, M.D. M.P.H. . . . After reviewing the data and facts gathered by Plaintiffs, Dr. Kurt merely opined that ‘sufficient environmental and health information exists to merit further substantive discovery. . . .’ Significantly, Dr. Kurt makes no opinion as to whether exposure was a contributing factor to Plaintiffs’ alleged injuries or illness. Plaintiffs’ requested march towards discovery without some adequate proof of causation of injury is precisely what the MCMO was meant to curtail.
The court held that the plaintiffs’ inadequate showing was exactly the kind of failure that gave rise to the original decision in Lone Pine. It concluded that, “[u]ltimately, Dr. Kurt’s affidavit is wholly lacking in the establishment of causation and, at times, even presents information that is circumstantially in direct contradiction to Plaintiffs[’] allegations.” Consequently, the court dismissed the case for failure to comply with the case-management order.
Some Lessons Learned
The trial-court ruling in Strudley demonstrates the importance of laying a proper foundation before asking a court to depart from its traditional case-management approach. In addition to identifying the inadequacies of the plaintiffs’ allegations, the defense in Strudley presented evidence that called into serious question the bona fides of the plaintiffs’ claims. Thus informed, courts are more inclined to exercise their discretion to position the case for early resolution.
Many courts may be unfamiliar with or initially reticent to use the Lone Pine method of case management. As in Strudley, the defenseshould provide the court with the considerable (and growing) number of cases in which other courts have issued or approved Lone Pine orders, emphasizing those that resulted in an early and efficient disposition of the case. See, e.g., Abuan, 3 F.3d at 334; Acuna, 1998 WL 35283824, at *5–6; Wilcox, 2008 WL 4697013, at *6; Baker, 2007 WL 315346, at *4–5; Adjemian, 2002 WL 358829, at *4; Schelske, 933 P.2d at 802; Cottle v. Superior Ct., 3 Cal. App. 4th 1367 (Ct. App. 1992); Eggar, 1991 WL 315487, at *5; Lone Pine, 1986 WL 637507, at *2–3.
Defendants considering a Lone Pine motion should be sure not to ask for just any showing by plaintiffs. They should request sworn, admissible expert opinion on subjects that by their nature (and as a matter of law) are beyond the kin of lay jurors and require expert opinion, such as exposure through environmental media, dose, and medical causation. See, e.g., Acuna, 1998 WL 35283824, at *5–6.
The terms of a proposed Lone Pine order should make clear to the plaintiff the reason for the required showing. The proposed form of order should also provide notice that failure to make the required showing may result in dismissal of the claims.
Plaintiffs may object to any suggestion they be required to make an early prima facie showing. The appropriate response is that Lone Pine orders do not unfairly burden the plaintiff because, after all, this is evidence the plaintiff should have had before filing its lawsuit. See, e.g., Acuna, 200 F.3d at 340.
A toxic-tort defendant should not hesitate early in the litigation to ask the court to vary from the traditional case-management approach and enter a Lone Pine order if the evidence objectively suggests that the plaintiff’s claims lack merit.
Keywords: environmental litigation, toxic tort, Strudley, Antero
Daniel J. Dunn is a partner in the Denver, Colorado, office of Hogan Lovells US LLP and is a cochair of the Mass Torts Subcommittee of the Environmental Litigation Committee of the Section of Litigation. Anna K. Edgar and Andrew C. Lillie are associates in the firm’s Denver office.