Bernard et al v. Grefer et al

Filing 117

ORDER AND REASONS denying 85 MOTION to Enforce Settlement Agreement; The Court will contact the parties to schedule a status conference to discuss a scheduling order. Signed by Judge Eldon E. Fallon on 4/20/2015.(blg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

CATHERINE M. BERNARD, ET AL.

CIVIL ACTION

VERSUS

NO. 14-887

JOSEPH GREFER, ET AL.

SECTION "L" (2)

ORDER & REASONS
I. BACKGROUND
This case arises out of alleged personal injuries and property damages that resulted from
alleged exposure to naturally occurring radioactive material (“NORM”), also known as
technologically enhanced radioactive materials (“TERM”), as part of oil operations by various
pipe-cleaning defendants. In addition to the pipe-cleaning defendants, Plaintiffs name the
landowners who owned the land upon which the pipe-cleaning operations were conducted and
oil companies as defendants. The Petition asserts claims by approximately 465 Plaintiffs who
originally filed their claims in the Civil District of Orleans Parish on March 5, 2014. Defendant
Transco Exploration Co. removed this case to federal court pursuant to the Class Action Fairness
Act. (Rec. Doc. 1).
The Petitioners are all present or former residents of Jefferson Parish and have all, at
some point, worked or lived in the area near “Grefer Tract,”1 the land at issue. (Rec. Doc. 1-1 at
9). From 1953 until 1992, the property was leased to clean, maintain, and repair used oil field
pipes and equipment. (Rec. Doc. 1-1 at 9). Plaintiffs allege that the “oil field equipment and
pipes were and continue to be contaminated with highly toxic materials, hazardous, carcinogenic,
and poisonous” and that this contaminated the Grefer Tract. (Rec. Doc. 1-1 at 10). Plaintiffs
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The “Grefer Tract” refers to 33 acres of industrial property owned by the Grefer Family.

contend that the property contamination also contaminated the air, land, ground water, top soil,
subsoils, food, neighborhoods, and that “petitioners have become infested with these highly toxic
hazardous chemicals, toxicants, and pollutants.” (Rec. Doc. 1-1 at 10). Plaintiffs allege that at
all times, Defendants knew or should have known that the oil pipes were contaminated. (Rec.
Doc. 1-1 at 11). Plaintiffs allege that the contamination was caused by the “negligence, wanton
conduct, breach of duty, deceit, and intentional misrepresentation of the defendants.” (Rec. Doc.
1-1 at 12).
The Plaintiffs brought claims against twenty-eight Defendants but have settled with most
Defendants, leaving only two Defendants in the case: ExxonMobil and Intracoastal Tubular, Inc.
(“Intracoastal”). Plaintiffs filed a Second Supplemental Amended Complaint on December 23,
2015 and allege, in addition to their personal injury claims, that ExxonMobil and Intracoastal
Tubular Co. entered into a settlement agreement in Dottie Adams et al. v. Joseph Grefer et al.
(“Dottie Adams”)2 and that Defendants breached that settlement agreement. (Rec. Doc. 76 at 1).
As background to the settlement agreement, on October 11, 2005, Dottie Adams was filed
on behalf of roughly 1,205 claimants who asserted personal injuries allegedly caused by
exposure to NORM, TERM, and other toxic and or hazardous materials as a result of the
Defendants’ operations in the Grefer Tract. On November 27, 2007, the 24th JDC granted
Plaintiff’s Motion for Leave and First Supplemental and Amended Petition, bringing the total
number of plaintiffs in the Dottie Adams lawsuit to approximately 4,322. (Rec. Doc. 92-3).
A. ExxonMobil’s Dottie Adams Settlement and Subsequent Events
In 2008, ExxonMobil and the Dottie Adams plaintiffs reached a settlement (“the
Agreement”). Counsel for ExxonMobil summarized this Agreement in a letter, dated February

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24th Judicial District Court (“JDC”), Parish of Jefferson, No. 624-278, Div. “K.”

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14, 2008, to lead Plaintiffs’ counsel, Grover G. Hankins. Under the Agreement, Plaintiffs’
recovery would be based on a point system. The letter stated:
The application of the points system below will apply to pay
individual settlement amounts to all Dottie Adams plaintiffs listed
in the original and amended petitions filed in the 24th Judicial
District Court for the Parish of Jefferson, Louisiana, that meet the
criteria to receive a settlement as stated above.
As a basis to reach this agreement in principle, counsel for
plaintiffs in the Dottie Adams case have stated to ExxonMobil that
they have been retained as the sole legal counsel to represent the
interests of the Dottie Adams plaintiffs listed in the original and all
amended petitions and that they have the authority to bind each of
the Dottie Adams plaintiffs listed in the original and all amended
petitions to settle their individual claims based on the point system
set forth below. ExxonMobil agrees to pay additional claimants
that become plaintiffs in the Dottie Adams case in the future using
this point system, provided said claimants meet the settlement
criteria set forth above.
(Rec. Doc. 78-2 at 2).
Pursuant to the Agreement, and Plaintiffs do not dispute this point, ExxonMobil paid
approximately $8,200,000 to 2,004 claimants. (Rec. Doc. 96 at 6). Of those 2,004 individuals
who received settlement payments under the terms of the Agreement, approximately 1,691 were
Dottie Adams Plaintiffs on February 14, 2008, the day the Agreement was executed, and 313
individuals were “new” claimants. These 313 individuals constituted claimants who were not
named plaintiffs in the Dottie Adams lawsuit, but ExxonMobil entered a settlement agreement
with them pursuant to the Agreement’s settlement terms and calculated those settlement amounts
based on the Agreement’s point system.
ExxonMobil claims that in or around June 2008, Plaintiffs’ counsel provided
ExxonMobil with a list of an additional 1,000 claimants, most of whom were not named in the
Dottie Adams suit. This list eventually swelled to over 1,700 claimants, and Plaintiffs’ counsel

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claimed that those claimants were entitled to the terms of the Agreement despite the fact that
they were not named plaintiffs in the Dottie Adams suit. According to ExxonMobil, Plaintiffs’
counsel demanded that ExxonMobil pay an additional $4.2 million in settlement money for these
“new” claimants. Plaintiffs do not exactly dispute this contention, as their memorandum states:
“Exxon, despite repeated requests, subsequently refused to pay the remainder of the “new”
claimants.” (Rec. Doc. 85-1 at 2). ExxonMobil refused to settle with these “new” claimants.3
Plaintiffs’ counsel consequently filed a number of motions for leave to amend the Dottie
Adams petition, seeking to formally add these “new” claimants as Dottie Adams plaintiffs.
ExxonMobil and other Defendants opposed these motions for leave. On May 23, 2011, the 24th
JDC denied the Motion for Leave to File a 2nd Supplemental and Amending Petition. (Rec. Doc.
92-9). On April 1, 2013, Plaintiffs’ counsel filed a Motion for Leave to file a 3d Supplemental
and Amended Petition. (Rec. Doc. 92-10). On June 25, 2013, Plaintiff’s counsel filed a Motion
for Leave to file a 4th Supplemental and Amending Petition and sought to add an additional 1,750
claimants as Dottie Adams Plaintiffs. (Rec. Doc. 92-11). On September 30, 2013, Plaintiffs’
counsel filed a Motion for Leave to file a 4th Supplemental Petition. (Rec. Doc. 92-12). On
October 9, 2013, Plaintiffs’ counsel filed a Motion for Leave to file a 3rd Supplemental and
Amending Petition (Rec. Doc. 92-13), a Motion for Leave to File a Supplemental and Amending
Petition to Fourth Supplemental Petition (Rec. Doc. 92-14), and a Motion for Leave to File a
Fifth Supplemental Petition (Rec. Doc. 92-15). On October 18, 2013, two of ExxonMobil and
Intracoastal’s co-defendants filed oppositions to Plaintiffs’ motions for leave to file supplemental
and amending petitions. In one opposition, a defendant noted that Plaintiff was seeking to add
1,752 new parties to the lawsuit. (Rec. Doc. 92-17 at 1). On October 24, 2013, ExxonMobil

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For the remainder of this memorandum, “new” claimants shall refer to those claimants who were not
Dottie Adams plaintiffs as of February 14, 2008 and never became Dottie Adams plaintiffs.

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filed an opposition to the pending motions for leave to file supplemental and amending petitions.
(Rec. Doc. 92-18).
On October 28, 2013, the 24th JDC denied all of Plaintiffs’ pending motions for leave to
file amending and supplemental petitions. (Rec. Doc. 92-19 & 92-20). This denial effectively
barred any additional claimants from becoming Dottie Adams plaintiffs.
II.

PRESENT MOTION
A. Plaintiffs’ Motion to Enforce Settlement Agreement (Rec. Doc. 85)
Plaintiffs file the present motion and seek enforcement of the 2008 Agreement for the

Plaintiffs in this lawsuit. Plaintiffs argue that while executing the Agreement, Defendants also
processed “new” claimants. (Rec. Doc. 85-1 at 2). Plaintiffs argue that ExxonMobil’s refusal to
pay additional “new” claimants, and their objections to Plaintiffs attempts to formally add these
“new” claimants to the Dottie Adams suit through amended petitions, renders ExxonMobil
“estopped” from asserting that the Plaintiffs did not meet a condition precedent of actually being
named in the Dottie Adams suit. (Rec. Doc. 85-1 at 2). Plaintiffs claim ExxonMobil therefore
acted in bad faith. (Rec. Doc. 85-1 at 2).
Plaintiffs argue that the terms of the Agreement only require Plaintiffs to “file” an
amendment, and that any ambiguity should be construed against ExxonMobil. Moreover,
Plaintiffs contend that since the Agreement is ambiguous the Court should look to the parties’
conduct to determine the contract. Namely, the Court should look to the fact that ExxonMobil
paid “new” claimants according to the point system outlined in the Agreement. (Rec. Doc. 85-1
at 4-5).

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B. Intracoastal’s Opposition (Rec. Doc. 93)
Defendant Intracoastal Tubular opposes the motion and argues that while Plaintiffs’
motion states “defendants, ExxonMobil and ITCO through their counsel of record, drafted and
sent an agreement to counsel for plaintiffs confirming the settlement had been negotiated
between the parties,” Intracoastal was not a party to the Agreement. (Rec. Doc. 93 at 3).
Intracoastal states that “Intracoastal and its counsel played no part in drafting the agreement, did
not know about the document, did not send it to anyone, and played no part in any negotiation
concerning the document.” (Rec. Doc. 93 at 4). Despite this, Intracoastal states that the
Plaintiffs consistently refer to the “Defendants” throughout their motion.
C. ExxonMobil’s Opposition (Rec. Doc. 95)
Defendant ExxonMobil opposes the motion. ExxonMobil contends that pursuant to
Louisiana law, when a contract is unambiguous, the Court’s analysis is limited to “the four
corners of the instrument, and extrinsic (parol) evidence is inadmissible either to explain or to
contradict the terms of the contract.” (Rec. Doc. 96 at 11). ExxonMobil argues that the
agreement clearly and unambiguously outlines conditions precedent that the Plaintiffs in the
present case did not fulfill – they never became Dottie Adams plaintiffs. (Rec. Doc. 96 at 13).
ExxonMobil avers that “the 2008 Conditional Agreement to Settle is a binding, conditional
agreement that may be enforced by any claimant that: (1) was a Dottie Adams plaintiff when the
Agreement was executed; or (2) became a Dottie Adams plaintiff thereafter.” (Rec. Doc. 96 at
15).
ExxonMobil contends that Plaintiffs’ argument that the Court should enforce the
agreement because they filed a motion to amend the petition in Dottie Adams is without merit.
First, ExxonMobil maintains that this argument ignores the plain language of the Agreement, as

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the Agreement requires that those claimants who were not already Dottie Adams plaintiffs as of
February 8, 2008 become Dottie Adams plaintiffs. (Rec. Doc. 96 at 18). Here, Plaintiffs never
actually became Dottie Adams plaintiffs, so ExxonMobil asserts that the Court’s inquiry should
end there. (Rec. Doc. 96 at 18). Second, ExxonMobil argues that Plaintiff’s assertion that
merely “filing” an amended petition is sufficient to satisfy the conditional precedent is without
merit. (Rec. Doc. 96 at 19). ExxonMobil notes that filing an amended petition without leave of
court has no effect pursuant to Louisiana law. ExxonMobil notes that this Court rejected a
similar argument in Lester v. Exxon Mobil Corp., and held that “[f]ailure to obtain leave of court
when it is required renders the amendment totally without effect and it is deemed not to have
been filed at all.” (Rec. Doc. 96 at 19) (citing Lester v. ExxonMobil, CIV.A. No.06-9158, 2007
WL 1029507 (E.D. La. Mar. 29, 2007) (Fallon, J.)). Thus, ExxonMobil argues, none of the
Bernard Plaintiffs “became” Dottie Adams plaintiffs because they were not listed on a filed
amended or supplemental petition. (Rec. Doc. 96 at 20).
ExxonMobil further argues that Plaintiffs’ proposed interpretation of the Agreement
would lead to absurd results, as it would allow any claimant to satisfy the condition precedent
merely by filing an amended or supplemental petition, even if the Court denies leave to file the
petition. (Rec. Doc. 96 at 20). ExxonMobil insists that the agreement lacks ambiguity, and that
ExxonMobil did not waive or modify the condition precedent by voluntarily settling with “new”
claimants. (Rec. Doc. 96 at 22). ExxonMobil also disputes Plaintiffs’ assertion that it acted in
bad faith by opposing the motions to amend the pleadings, as Plaintiffs’ counsel did not have a
right to demand an additional $4.2 million from ExxonMobil, and Plaintiffs’ counsel tried to
circumvent the Agreement by adding thousands of “new” claimants to the petition. Moreover,
ExxonMobil argues that Plaintiffs cannot prove causation vis à vis this alleged bad faith, as the

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24th JDC exercised its own discretion not to grant the motions and numerous other defendants
filed similar motions.
D. Plaintiffs’ Reply (Rec. Doc. 102)
Plaintiffs reply. Plaintiffs argue that it is an absurd proposition to argue that ExxonMobil
“voluntarily” paid 313 “new” claimants according to the point system established by the
Agreement, so the Agreement must have compelled this action. (Rec. Doc. 102 at 5-6).
Alternatively, Plaintiffs argue that ExxonMobil modified the agreement. (Rec. Doc. 102 at 5-6).
Plaintiffs also aver that these payments present an ambiguity to the Court and should be
construed against ExxonMobil.
In response to ExxonMobil’s argument that Plaintiffs did not become Dottie Adams
plaintiffs, Plaintiffs argue that the 24th JDC’s denial of their motions for leave to file amending
and supplemental petitions has no effect on the enforceability of the Agreement. Moreover,
Plaintiffs contend that “[w]hile their “filing” may not reach legal stature, in the vernacular
“filing” is commonly understood as presenting the Court through the Clerk and the preliminaries
of stamping and setting for hearing.” (Rec. Doc. 102 at 9). The term”filed”, Plaintiffs argue,
thus presents another ambiguity.
E. ExxonMobils’s Response to Plaintiffs’ Oral Argument (Rec. Doc. 108)
During oral argument, Plaintiffs also argued that they were entitled to recover under a
theory of detrimental reliance. Defendants disagree, arguing that Plaintiffs are unable to satisfy
the three necessary elements to prove a claim of detrimental reliance pursuant to La. Civ. Code
art. 1967. First, ExxonMobil argues that Plaintiffs offer no evidence that ExxonMobil made any
sort of representation to Plaintiffs or that any Plaintiffs relied on such a representation. (Rec.
Doc. 108 at 6-7). ExxonMobil avers that Plaintiffs’ claim fails under the second prong, as any

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reliance would be presumptively unreasonable because it conflicts with the required settlement
formalities under La. Civ. Code art. 3072.
Plaintiffs respond and argue that the parties can modify a written contract even when the
contract limits modifications to those in writing. (Rec. Doc. 116 at 12).
III.

LAW AND ANALYSIS
“Although the federal courts possess the inherent power to enforce agreements entered

into in settlement of litigation, the construction and enforcement of settlement agreements is
governed by principles of state law applicable to contracts generally.” Lockette v. Gretyhound
Lines, Inc., 817 F.2d 1182, 1185 (5th Cir. 1987) (quoting Lee v. Hunt, 631 F.2d 1171, 1173-74)
(5th Cir. Unit A 1980)). Here, Louisiana law applies to this Court’s analysis of the Agreement.
Moreover, Plaintiffs bear the burden of proving the obligation by a preponderance of the
evidence. See La Civ. Code art. 1831 (“A party who demands performance of an obligation
must prove the existence of the obligation.”).
The Court must first dispose of any argument to enforce the Agreement against
Intracoastal. Plaintiffs present no evidence or argument that Intracoastal was a party to the
Agreement. While Plaintiffs initially refer to both ExxonMobil and Intracoastal, the rest of their
motion solely focuses on ExxonMobil’s actions. Nevertheless, Plaintiffs reference
“ExxonMobil” and “Defendants” interchangeably throughout their memorandum. There is no
argument that the Court should enforce the Agreement against Intracoastal, and the Court will
now direct its attention to Plaintiffs’ argument that the Court should enforce the agreement
against ExxonMobil.
A compromise agreement is governed by the same general rules of construction
applicable to contracts. Brown v. Drillers, Inc., 630 So.2d 741, 747 (La. 1994). Louisiana law

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provides, “[w]hen the words of a contract are clear and explicit and lead to no absurd
consequences, no further interpretation maybe made in search of the parties’ intent.” La. Civ.
Code art. 2046. “Under this Article, when a clause in a contract is clear and unambiguous, the
letter of that clause should not be disregarded under pretext of pursuing its spirit.” Official
Comment, La. Civ. Code art. 2046. Thus, when a contract’s terms are clear, the Court shall only
seek the meaning and intent of the parties within the four corners of the instrument and cannot
look to parol evidence. La. Civ. Code art. 1848; Hampton v. Hampton, 713 So.2d 1185, 1189
(La. App. 1 Cir. 1998); See also Claitor v. Brooks, 137 So.3d 638, 644-45 (La. App. 1 Cir. 2013)
(“[W]here the words of a contract are clear, explicit and lead to no absurd consequences, the
meaning and intent of the parties must be sought within the four corners of the instrument and
cannot be explained or contradicted by parol evidence.”).
Article 30764 provides “[a] compromise settles only those differences that the parties
intended to settle, including the necessary consequences of what they express.” La Civ. Code
art. 3076. In applying the rule of construction set forth in La. Civ. Code art. 3076, “courts are
guided by the general principal ‘that the contract must be construed as a whole and in light of
attending circumstances.’” Robinson v. Robinson, 778 So.2d 1105, 1122 (La. 2001). “Thus, the
intent which the words of the compromise instrument express in light of the surrounding
circumstances at the time of the execution of the agreement is controlling.” Id. There is
therefore an exception to the general rule that limits analysis to the four corners of the contract
“when there is a dispute between the parties as to exactly what matters were intended to be
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“La. Civ.Code Art. 3076 was enacted to reproduce the substance of La. Civ.Code Art.
3073 as follows, ‘A compromise settles only those differences that the parties clearly intended to
settle, including the necessary consequences of what they express.” The revisions comments
indicate, ‘This Article reproduces the substance of Article 3073 of the Louisiana Civil Code of
1870. It is not intended to change the law.’” Kling Realty Co. v. Texaco, Inc., No. CIV.A. 061492, 2007 WL 2693855, at *9, n.6 (W.D. La. Sept. 11, 2007) (quoting LA LEGIS 138 (2007)).
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settled by the compromise agreement.” Smith v. Leger, 439 So.2d 1203, 1206 (La. Ct. App. 1
Cir. 1983)
Louisiana courts have construed this exception narrowly and have limited the rule’s
application to cases “in which substantiating evidence is presented establishing either (1) that the
releasor was mistaken as to what he or she was signing, even though fraud was not present; or
(2) that the releasor did not fully understand the nature of the rights being released or that the
releasor did not intend to release certain aspects of his or her claim.” Brown, 630 So.2d at 749
(citing Higgins v. Spencer, 531 So.2d 768, 772 (La.App. 1 Cir. 1998)), writ denied, 532 So.2d
106 (La.1988)). “When the factual circumstances surrounding the execution of the release
instrument do not fall within either of the above categories, Louisiana courts have applied the
general rule of construction in La. C[iv.] C[ode] art.2046 and have not hesitated to confine their
analysis to the four corners of the instrument.” Hudson v. Progressive Sec. Ins. Co., 1 So. 3d
627, 632-33 (La. App. 2 Cir. 2008). Here, neither of those circumstances are present, so the
Court will not look beyond the four corners of the Agreement based on the rule of construction
found in La. Civ. Code Art. 2076.
“A conditional obligation is one dependent on an uncertain event. If the obligation may
not be enforced until the uncertain event occurs, the condition is suspensive.” La. Civ. Code art.
1767. The pertinent parts of the Agreement state:
The application of the points system below will apply to pay
individual settlement amounts to all Dottie Adams plaintiffs listed
in the original and amended petitions filed in the 24th Judicial
District Court for the Parish of Jefferson, Louisiana, that meet
the criteria to receive a settlement as stated above.
ExxonMobil agrees to pay additional claimants that become
plaintiffs in the Dottie Adams case in the future using this point
system, provided said claimants meet the settlement criteria set
forth above.
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The “criteria above” include residency or employment requirements. From this language,
it is obvious that for a claimant to enforce the Agreement, she had to satisfy the condition
precedent of either (1) being a Dottie Adams plaintiff as of February 14, 2008, by either being
listed on the original or amended petitions; or (2) becoming a Dottie Adams plaintiff.
Plaintiffs in the instant case do not dispute that they were not Dottie Adams plaintiffs
when the agreement was executed, but they contend that they qualify for the settlement because
(1) the parties modified the contract to include these additional claimants; (2) Plaintiffs filed
amended and supplemental petitions in the 24th JDC, and the Court should find that these filings
are sufficient or that ExxonMobil acted in bad faith; (3) the contract is ambiguous and the Court
should look outside the contract to the parties conduct; or (4) the Plaintiffs can recover under a
theory of detrimental reliance.
A. ExxonMobil Modified the Contract through Payment to “New
Claimants”
Plaintiffs assert that ExxonMobil modified the contract through their payment to 313
“new” claimants. “The party asserting modification of an obligation must prove by a
preponderance of the evidence facts or acts giving rise to the modification.” Id. at 501. See La.
Civ. Code art. 1831 (“A party who asserts that an obligation is null, or that it has been modified
or extinguished, must prove the facts or acts giving rise to the nullity, modification, or
extinction.”). While Article 1848 provides that parol evidence is admissible to prove that a
written act was modified by a subsequent and valid oral agreement, such verbal amendments
only apply to contracts that are not required to be in writing. See Salley v. Louviere, 162 So. 81,
813 (La. 1935); Monroe v. Physicians Behavior Hosp., LLC, 147 So.3d 787, 797 (La. App. 2 Cir.
2014); See also Peter S. Title, Exception to General Rule – Modification of Contracts, La. Prac.
Real Est. § 7:47, (2d ed.). Pursuant to Louisiana law, settlements must be in writing. La. Civ.
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Code art. 3072. ExxonMobil’s alleged statements regarding settlements with “new” claimants
therefore constitute inadmissible parol evidence to prove a contract modification because such
modifications must be in writing.
Even if the Court could consider this evidence, Plaintiffs would not meet their burden to
prove a modification. The fact that ExxonMobil chose to settle with additional claimants
according to the point system set forth in the Agreement is not evidence that they unequivocally
modified the agreement to include claimants, who did not satisfy the condition of being or
becoming a Dottie Adams plaintiff, in the Agreement. Plaintiffs fail to cite a single supporting
case that would support such a finding – that a Defendant’s decision to voluntarily settle with
claimants who are not parties to a settlement would modify the settlement as to require the
Defendant to settle with all similarly situated claimants. Such a ruling would surely chill future
settlements and is likely why the Plaintiffs have been unable to find a single court that enforced
such a despotic rule.
B. Plaintiffs never “filed” an amended petition in the 24th JDC
Based on the unambiguous language of the Agreement, eligible “additional” claimants
must become Dottie Adams plaintiffs. Under Louisiana law, once an answer is served, “the
petition . . . may be amended only be leave of court or by written consent of the adverse party.”
La. Code Civ. Proc. art. 1151. “Failure to obtain leave of court when it is required renders the
amendment totally without effect and it is deemed not to have been filed at all.” Morgan v. ABC
Mfr., 637 So. 2d 1076, 1079 (La. App. 1 Cir. 1994). Here, the 24th JDC denied Plaintiffs’
counsels’ motions to amend or supplement the Dottie Adams petitions with new claimants.
Plaintiffs’ filings therefore impose no legal effect: it as if Plaintiffs never filed those amended

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petitions. In other words, the claimants did not become Dottie Adams plaintiffs and were
therefore not eligible for the Agreement.
In their reply, Plaintiffs urge this Court to adopt the vernacular definition of the word
“filing,” but the terms “filed in the 25th Judicial District Court for the Parish of Jefferson,
Louisiana” only apply to those individuals who were Dottie Adams Plaintiffs on February 14,
2008 and not to additional claimants. Moreover, even if the Court were to find that the term
“filed” applied to additional claimants, Plaintiffs’ suggested interpretation rings hollow. The
Agreement requires a filed amended petition, the filing of a legal record with court, so there can
be no other definition other than what Louisiana law defines as a filed amended petition pursuant
to La. Code Civ. Proc. art. 1151. The term “filed” is therefore unambiguous.
The Court is unpersuaded by the argument that it should enforce the Agreement because
ExxonMobil acted in bad faith. The 24th JDC exercised its own discretion to deny Plaintiffs’
motions, and ExxonMobil’s co-defendants also filed oppositions to Plaintiffs’ motions for leave
to file amended petitions. Based on the 24th JDC’s denial of leave, the Court finds that there
must not have been sufficient connectivity or commonality for the Plaintiffs to add those
claimants.
C. Court Should Interpret Contract Terms based on ExxonMobil’s
Performance
As already stated, the Court is not persuaded by Plaintiffs’ argument that the contract is
ambiguous as to what it means to become a Dottie Adams plaintiff in the future or to file an
amended petition. Much of Plaintiffs’ argument focuses on the fact that ExxonMobil paid “new”
claimants, and that this evidences that such “new” claimants satisfied the condition precedent of
becoming a Dottie Adams plaintiff by filing an amended petition. But Plaintiffs fail to deal with
the touchstone of Louisiana contract interpretation: the Court will not look outside the contract
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when the terms are unambiguous. As articulated above, Louisiana law provides a clear answer
as to how one can file an amended petition and include an additional plaintiff. The Plaintiffs in
this case were merely unsuccessful in their many efforts to achieve that result. Since the terms of
the Agreement are unambiguous, the Court cannot look beyond the four corners to interpret the
contract.
D. Detrimental Reliance
As previously noted, during oral argument, Plaintiffs’ counsel introduced a new theory of
recovery under detrimental reliance. A cause of action for detrimental reliance originates with
the Louisiana Civil Code:
A party may be obligated by a promise when he knew or should have
known that the promise would induce the other party to rely on it to his
detriment and the other party was reasonable in so relying. Recovery may
be limited to the expenses incurred or the damages suffered as a result of
the promisee’s reliance on the promise. Reliance on a gratuitous promise
made without required formalities is not reasonable.
La. Civ. Code art. 1967. “Detrimental reliance requires (1) a representation by conduct or word,
(2) justifiable reliance on the representation, and (3) a change in position to the plaintiff’s
detriment as a result of the reliance.” Drs. Bethea, Moustoukas and Weaver LLC v. St. Paul
Guardian Ins. Co., 376 F.3d 399, 403 (5th Cir. 2004); see Suire v Lafayette City-Parish Consol.
Gov’t, 907 So. 2d 37, 59 (La. 2005). “Significantly, to prevail on a detrimental reliance claim,
Louisiana law does not require proof of a formal, valid, and enforceable contract.” Suire, 907
So. 2d at 59. Indeed, detrimental reliance “usually functions when no written contract or an
unenforceable contract exists between the parties.” Drs. Bethea, Moustoukas and Weaver LLC,
376 F.3d at 403. “Rather, the existence of a promise and a reasonable reliance on that promise to
one's detriment are the only requirements.” Percy J. Matherne Contractor Inc. v. Grinnell Fire
Protection Systems Co., 915 F. Supp. 818, 824 (M.D. La. 1995). In general the doctrine of
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detrimental reliance is disfavored by the law and all claims must be analyzed carefully and
strictly. SJB Group, LLC v. TBE Group, Inc., 2013 WL 6194571, at *10 (W.D. La. Nov. 26,
2013) (citing May v. Harris Management Corp., 928 So.2d 140, 145 (La. App. 1 Cir. 2005)).
Based on the facts of this case, Plaintiffs present no cognizable detrimental reliance
claim. There was an enforceable contract in the instant case – the Plaintiffs in this case were just
not parties to the Agreement. More significantly, Louisiana law requires a settlement agreement
to be written to be enforceable, thus negating any argument that Plaintiffs’ alleged reliance was
reasonable. The Louisiana Supreme Court has held that “[a]bsent fraud, or at least affirmative
misrepresentation as to the necessity of writing…it is almost always the case that it will be
unreasonable to rely on an oral promise where the law requires such a promise to be in writing to
be enforceable.” Morris v. Friedman, 663 So.2d 19, 26 n.14 (La. 1995). The Louisiana First
Circuit relied on this principal and refused to enforce a settlement agreement in a case where the
party sought to enforce an agreement based on a theory of detrimental reliance. Amitech U.S.A.,
Ltd. v. Nottingham Const. Co., 57 So.3d 1043, 1052 (La.App. 1 Cir. 2010). The court deemed
any reliance unreasonable because Louisiana law mandates that parties record settlement
agreements in writing to be enforceable. Id. Similarly, Plaintiffs’ claims in the instant case fail
under a theory of detrimental reliance because any reliance is unreasonable in the absence of a
written settlement agreement as required by La. Civ. Code. art. 3072.
While Plaintiffs argue that modifications to written contracts are permitted even when
those contracts limit modifications to those in writing, this argument is misguided. There is a
distinction between when a contract requires a written modification and when the law mandates a
written modification, and this case falls within the latter situation. It is thus evident that

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Plaintiffs cannot satisfy the second element of La. Civ. Code. art. 1967 because the settlement
must have been in writing, and their detrimental reliance claims fail.
IV.

CONCLUSION
In sum, Plaintiffs are unable to offer any credible argument that the Court should enforce

the agreement when they never became Dottie Adams plaintiffs. Evidence that ExxonMobil
chose to settle with some “new” claimants does not modify the contract because any
modification had to be in writing pursuant to Louisiana law. Moreover, the Plaintiffs never
became Dottie Adams plaintiffs and were not listed on an amended or supplemental petition filed
in the 24th JDC, as required by the clear terms of the Agreement. Finally, the Court does not find
any ambiguity that would compel the Court to look to parol evidence to ascertain the contract’s
meaning and the Plaintiffs cannot invoke detrimental reliance because Louisiana law requires a
written agreement. Therefore,
IT IS ORDERED that Plaintiffs’ Motion to Enforce the Settlement Agreement (Rec.
Doc. 85) is hereby DENIED. The Court will contact the parties to schedule a status conference
to discuss a scheduling order.
New Orleans, Louisiana this 20th day of April, 2015.

________________________________
UNITED STATES DISTRICT JUDGE

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