Leblanc et al v. Texas Brine Company, LLC

Filing 663

ORDER denying #573 Motion to Dismiss for Failure to State a Claim. Signed by Judge Jay C. Zainey. (Reference: as listed)(jrc)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
LISA T. LEBLANC, ET AL.

CIVIL ACTION

VERSUS

NO: 12-2059 AND
CONSOLIDATED CASES

TEXAS BRINE, LLC

SECTION: "A" (4)

ORDER
Third-party defendants Adams Resources Exploration Corp. and
Browning Oil Co. have filed a Motion to Dismiss Pursuant to FRCP
12(b)(6) for Failure to State a Claim (Rec. Doc. 573). Texas
Brine Co., LLC ("TBC") has filed an opposition (Rec. Doc. 586)
and supplemental opposition (Rec. Doc. 621). Movants have filed a
joint reply (Rec. Doc. 631). The motion, noticed for submission
on May 20, 2015, is before the Court on the briefs without oral
argument.1
Plaintiffs brought these various consolidated actions to
recover damages resulting from the development of a “sinkhole” on
property allegedly belonging to and/or under the control of
defendants TBC and Occidental Chemical Corporation near the
hamlet of Bayou Corne in Assumption Parish, Louisiana. Plaintiffs
allege that the sinkhole resulted from the failure of a salt

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Texas Brine has requested oral argument but the Court is
not persuaded that oral argument would be helpful in light of the
issues presented.

cavern owned by TBC, with that failure perhaps caused by some
reworking activities undertaken by TBC in September 2010. (CA122059, Rec. Doc. 1, Complaint ¶ 4).
TBC filed a third-party demand ("TPD") against Adams and
Browning, two oil and gas exploration companies that had
previously conducted operations on the Hooker #1 Well, which was
located adjacent to the Oxy Geismar Well #3 (the well used to
mine the now collapsed salt cavern). (Rec. Doc. 557). TBC's
contention is that the Hooker #1 Well was directionally drilled
in such a manner that it extracted oil from the reservoir known
as "Big Hum," which tended to dramatically reduce pressure in the
reservoir. (Id. ¶¶ 162-63). According to TBC, because the
reservoir had previously provided support to the outer wall of
the salt cavern of Oxy Geismer Well #3, the reduced pressure in
the Big Hum reservoir caused or contributed to the collapse of
the salt cavern and the formation of the sinkhole. Adams drilled
the Hooker #1 Well in 1986, and Browning operated the well from
1991 to 2001. (Rec. Doc 573-1, Movants' Memo at 1). The well was
"shut-in" in approximately September 2001. (Rec. Doc. 557, TPD ¶
469).
TBC has asserted claims against Adams and Browning on
theories of negligence, strict liability, and contribution to
recover any amounts for which TBC may be found legally liable to

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Plaintiffs (Id. ¶ 171)2 as well as the approximately $80 million
dollars in response costs that TBC incurred after the emergence
of the sinkhole (Id. ¶ 210). Adams and Browning now move for
dismissal pursuant to Rule 12(b)(6) arguing that none of TBC's
claims are cognizable as a matter of law.
A motion to dismiss under Rule 12(b)(6) "is viewed with
disfavor and is rarely granted." Harrington v. State Farm Fire &
Cas. Co., 563 F.3d 141, 147 (5th Cir. 2009) (quoting Gregson v.
Zurich Am. Ins. Co., 322 F.3d 883, 885 (5th Cir. 2003)). In
evaluating the merits of such a motion the Court must construe
the complaint liberally in favor of the plaintiff and take all
facts pleaded in the complaint as true. Id. In the Fifth Circuit
this strict standard is summarized as follows: "[T]he question []
is whether in the light most favorable to the plaintiff and with
every doubt resolved on his behalf, the complaint states any
valid claim for relief." Id.
At this juncture the cause or causes of the Bayou Corne
sinkhole have not been determined. The Court therefore assumes
for the sake of argument that the sinkhole was caused by human
fault as opposed to an act of God. And accepting TBC's
allegations as true, the Court assumes that Adams' and Browning's
past activities, regardless of their remoteness in time, caused

2

This paragraph of the TPD actually refers to "Florida Gas"
instead of "Plaintiffs" but the Court assumes that this reference
was made in error. (Rec. Doc. 557 at 48).
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the TBC salt cavern to collapse resulting in the Bayou Corne
Sinkhole. If TBC, Adams, and Browning were all at fault for
causing the Sinkhole then TBC cannot seek tort indemnity from
Adams and Browning under Louisiana law. The Louisiana Supreme
Court explained in Nassif v. Sunrise Homes, Inc., 739 So. 2d 183,
185 (La. 1999), that tort indemnity that arises by operation of
law arises only where the liability of the person seeking
indemnification is solely constructive or derivative. The action
for indemnity lies against one, who because of his act, has
caused such constructive liability to be imposed. Id. (citing
Bewley Furn. Co. v. Maryland Cas. Co., 285 So. 2d 216, 219 (La.
1973)). As such, tort indemnity by operation of law is a species
of equitable relief grounded on principles of restitution for an
otherwise unjust enrichment. See id. at 186 (quoting Minyard v.
Curtis Prods., Inc., 205 So. 2d 422, 431 (La. 1967)).
The Court finds it highly unlikely that any fact-finder
would conclude that TBC was completely free from actual fault,
i.e., that TBC was only constructively or derivatively at fault,
thereby entitling TBC to tort indemnity by operation of law. But
TBC correctly points out that challenges related to the
likelihood of success on the merits do not entitle Movants to
Rule 12(b)(6) relief.
Adams and Browning argue that TBC has pleaded its claims for
tort indemnity such that they are expressly premised on the

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condition of TBC being held at fault vis à vis Plaintiffs, and
that such fault precludes a finding of mere constructive or
derivative fault. (Rec. Doc. 573-1, Movants' Memo at 8-9). The
Court disagrees with Movants' characterization of TBC's
allegations. The allegations refer to TBC being found "liable" to
Plaintiffs not to TBC being at fault for the sinkhole. A tort
indemnity claim only arises if the defendant is held liable to
the plaintiff but it is the nature of that liability that
dictates whether the claim for tort indemnity is cognizable.
Moreover, TBC points out that the Plaintiffs have sued under
various theories including strict liability, which if applicable,
by its very nature has the potential for liability without actual
fault.3 The Court agrees with TBC's contention that the TPD
against Adams and Browning cannot be dismissed in its entirety
because of the possibility of recovery under a theory of tort
indemnity.4

3

This potential is affected by which version of Louisiana's
strict liability applies. Because the Court is not granting
Movants' motion to dismiss the TPD in its entirety, the Court
declines to address the arguments regarding strict liability and
whether any party in this case can avail itself of the pre-tort
reform version of that type of liability.
4

Adams and Browning correctly point out that under the
facts alleged, TBC has no claim for contribution in light of
Louisiana's adoption of comparative fault and the elimination of
solidary liability for
non-intentional torts. In other words, because TBC cannot be cast
in judgment for any other party's fault it cannot claim
contribution from any other tortfeasor. TBC did not take issue
with this assertion in its opposition.
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Finally, the Court agrees with TBC's assertion that the
question of legal duty should not be determined on the pleadings.
(Rec. Doc. 621, Supp. Opposition at 2). Therefore, Movants are
not entitled to Rule 12(b)(6) relief regarding TBC's claims for
non-indemnity costs.
Accordingly;
IT IS ORDERED that the Motion to Dismiss Pursuant to FRCP
12(b)(6) for Failure to State a Claim (Rec. Doc. 573) filed by
third-party defendants Adams Resources Exploration Corp. and
Browning Oil Co. is DENIED.
June 3, 2015

_______________________________
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE

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