Armstead v. Multi-Chem Group L L C et al

Filing 22

MEMORANDUM RULING re 9 MOTION to Remand, MOTION for Attorney Fees filed by Clarise Armstead. The plaintiffs' Motion to Remand will be GRANTED, subject to the stay set forth in the accompanying order, and this lawsuit will be remanded to state court. It is further ordered that plaintiffs' request for costs, expenses and attorney's fees will be DENIED. Signed by Magistrate Judge C Michael Hill on 5/21/2012. (crt,Dauterive, C)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
CLARISE ARMSTEAD, ET AL.

*CIVIL ACTION NO. 6:11-2136

VERSUS

*JUDGE DOHERTY

MULTI-CHEM GROUP, LLC., ET AL.

*MAGISTRATE JUDGE HILL

MEMORANDUM RULING
Pending before the undersigned is the plaintiffs’ Motion to Remand this suit to the
16 th Judicial District Court for Iberia Parish, Louisiana. [rec. doc. 9]. Defendants, MultiChem Group, LLC ("Multi-Chem"), Nathan Walker ("Walker") and Aaron Gauthier
("Gauthier"), (collectively the “removing defendants”), have filed opposition [rec. doc.
13], to which plaintiffs have filed a Reply. [rec. doc. 19]. Oral argument on the Motion
was held and the matter was taken under advisement. For the following reasons, the
Motion to Remand will be GRANTED, subject to the stay set forth in the accompanying
order, and accordingly, this lawsuit will be remanded to state court.
BACKGROUND
This lawsuit arises out of an explosion and fire that occurred at Multi-Chem's
facility in New Iberia, Louisiana on June 14, 2011.1 The plaintiffs in this lawsuit are 855
individuals whose homes are located near the Multi-Chem facility.2 Each plaintiff claims

1

Rec. Doc. 1-2, ¶ 2.

2

Rec. Doc. 1-2, Ex. A, and ¶ 4.

to have been exposed to hazardous fumes from the explosions and fire.3 All of the
plaintiffs seek to recover damages for pain and suffering for "skin irritation and rash,
particulate expectoration, burning eyes with yellow discharge, nausea, diarrhea, loss of
appetite, memory loss, respiratory distress and exacerbation of existing respiratory
issues"; medical and pharmaceutical expenses; mental anguish; evacuation expenses; lost
wages; property damages; damages for diminution of the value of property; and
exemplary and punitive damages.4
Plaintiff's claim for exemplary and punitive damages, asserted under Texas law, is
based on the alleged intentional and reckless failure of Multi-Chem's headquarters in
Texas to prevent the accident and resultant injuries by implementing appropriate policies,
utilizing appropriate equipment, assuring compliance with laws and regulations and
adequately training and supervising employees.5
The following stipulation is contained in the Petition which was filed in the 16 th
Judicial District Court, for Iberia Parish, Louisiana:
Each plaintiff specifically alleges and stipulates that he/she has not
sustained individual damages, including punitive or exemplary damages, in
excess of $75,000.00, exclusive of Interest and costs; that he/she does not
seek damages that would meet or exceed the jurisdictional amount in
controversy of a federal court sitting in diversity; and that he/she will not
amend the Petition to request class certification.6

3

Rec. Doc. 1-2, ¶ 4.

4

Rec. Doc. 1-2, ¶ 19.

5

Rec. Doc. 1-2, ¶ 18.

6

Rec. Doc. 1-2, ¶ 20.

2

In their Petition, the plaintiffs name not only Multi-Chem, but also name two of
Multi-Chem’s employees, Gauthier and Walker. Walker is alleged to be a supervisory
employee of Multi-Chem, a "blending manager", who instructed Gauthier to mix
chemicals, a task he, Gauthier, had never performed before, without providing any
guidance or supervision, after incorrectly informing Gauthier that the sequence of adding
ingredients was unimportant.7 This procedure, along with Gauthier's use of a
contaminated tote, caused the fire which is the subject of this litigation.8 Multi-Chem is
alleged to have delegated the duty of care it owed to plaintiffs to "corporate officers or
employees, Walker and/or Gauthier" who then breached this duty through their personal
fault.9 Walker is alleged to have delegated a dangerous task to an untrained
inexperienced employee, while Gathtier is alleged to have been negligent by proceeding
to attempt the task, despite knowing he was unqualified to perform it.10
The removing defendants removed the action on December 12, 2011, alleging
jurisdiction under the Class Action Fairness Act of 2005 (“CAFA”), 28 U.S.C.
§ 1332(d)(2).11 More specifically, the removing defendants cite CAFA's provisions
pertaining to "class actions" under § 1332(d)(2) - (10), alleging that this action is "in

7

Rec. Doc. 1-2, ¶ 3.

8

Rec. Doc. 1-2, ¶ ¶ 3 and 4.

9

Rec. Doc. 1-2, ¶ 14.

10

Rec. Doc. 1-2, ¶ 5.

11

Rec. Doc. 1.

3

substance and fact a 'class action' as defined by CAFA" and that all of the requirements
for the exercise of this court's jurisdiction of this purported "class action" under CAFA
have been met because there are more than 100 plaintiffs, minimal diversity exists and the
aggregate amount in controversy exceeds $5,000,000.00.12
The removing defendants further allege that none of the exceptions to the exercise
of CAFA jurisdiction under the provisions pertaining to "class actions" set forth in
§ 1332(d)(3) - (5) are applicable because, for purposes of the “home state exception”
(§ 1332(d)(4)(B)), the” local controversy” exception (§ 1332(d)(4)(A)) and discretionary
exception (§ 1332(d)(3)), Gauthier and Walker are not "primary defendants", who have
been fraudulently joined to defeat this court's jurisdiction and their citizenship should
therefore be disregarded.13
The instant Motion to Remand was filed on January 9, 2012. In the instant
Motion, plaintiffs contend that this court lacks jurisdiction under CAFA. More
specifically, the plaintiffs argue that federal jurisdiction under CAFA's provisions
pertaining to "class actions" does not exist because the instant lawsuit is not a "class
action" as defined under CAFA because the case has not been filed as a representative
action and also because neither Gauthier nor Walker have been fraudulently joined.
Plaintiffs additionally argue that federal jurisdiction under CAFA's provisions
pertaining to "mass actions" does not exist because this lawsuit does not qualify as a

12

Rec. Doc. 1, ¶ III - XI.

13

Rec. Doc. 1, ¶ XXVI - XXIX, XIX - XXV.

4

"mass action" because the "event or occurrence" exception removes this case from the
reach of CAFA and because the defendants have failed to demonstrate that any plaintiff's
claim exceeds $75,000 for exercise of jurisdiction under CAFA's provisions applicable to
"mass actions."
LAW AND ANALYSIS
“Federal courts are courts of limited jurisdiction. We must presume that a suit lies
outside this limited jurisdiction, and the burden of establishing federal jurisdiction rests
on the party seeking the federal forum.” Howery v. Allstate Ins. Co., 243 F.3d 912, 916
(5 th Cir. 2001); In re Vioxx Products Liability Litigation, ____ F.Supp.2d ____, 2012 WL
10552, *2 (E.D. La. 2012). Accordingly, the party removing to federal court has the
burden of establishing jurisdiction under CAFA. Preston v. Tenet Healthsystem Mem'l
Med. Ctr., Inc., 485 F.3d 793, 797 (5 th Cir. 2007). Once CAFA jurisdiction is established,
a party seeking remand has the burden of proving by a preponderance of the evidence that
an exception to CAFA jurisdiction applies. Id.
CAFA Jurisdiction
Congress enacted CAFA to encourage federal jurisdiction over interstate class
action lawsuits of national interest. Preston v. Tenet Healthsystem Memorial Medical
Center, Inc., 485 F.3d 793, 797 (5 th Cir. 2007). Under § 1332(d)(2), CAFA authorizes
removal of a "class action", provided the "class action" satisfies a basic jurisdictional test.
This test requires a removing defendant to prove minimal diversity and an aggregated
amount in controversy of $5,000,000 or more. Id. Minimal diversity is satisfied when
5

one plaintiff is diverse from one defendant. Exxon Mobil Corp. v. Allapattah Services,
Inc., 545 U.S. 546, 125 S.Ct. 2611, fn. 12 (2005). The putative class must also consist of
at least 100 class members. 28 U.S.C. § 1332(d)(5)(B).
CAFA defines the term “class action” as "any civil action filed under rule 23 of the
Federal Rules of Civil Procedure or similar State statute or rule of judicial procedure
authorizing an action to be brought by 1 or more representative persons as a class action."
28 U.S.C. § 1332(d)(1)(B).
It is clear that Congress emphasized that the term “class action” should be defined
broadly to prevent “jurisdictional gamesmanship”.14 It is equally clear that in determining
whether there is jurisdiction, federal courts look to the substance of the action and not
only at the labels that the parties may attach. See Louisiana ex rel Caldwell v. Allstate
Insurance Co., 536 F.3d 418, 424 (5 th Cir. 2008) citing Grassi v. Ciba-Geigy, Ltd., 894
F.2d 181, 185 (5 th Cir.1990). Nevertheless, the definitive aspect of a CAFA-removable
“class action” under 1332(d)(2) is that the action be a representative action authorized by
a statute or rule of procedure that authorizes a class action.
The action sought to be removed in this case is not a representative action, nor is
the action brought under a statute or rule authorizing a class action.15 To the contrary, this
action has not been filed under any statute authorizing a class action, there is no class

14

See S.Rep. No. 109-14, at 35 (2005), reprinted in 2005 U.S.C.C.A.N. 3.

15

A class-action equivalent of Federal Rule 23 exists in Louisiana. La. Code Civ. Proc. arts.
591-597. A suit brought under those provisions would fit neatly into CAFA's class action definition.
However, the plaintiffs have not invoked these Louisiana statutes.

6

representative, nor any class allegations pled; each plaintiff is proceeding in his or her
own individual capacity. Furthermore, there is no likelihood that this action will ever be a
class action as each plaintiff has stipulated in the Petition "that he/she will not amend the
Petition to request class certification." 16
This court cannot stretch the definition of "class action" beyond the limits set by
Congress, and Congress tied the scope of CAFA "class actions" to representative actions
filed under Federal Rule of Civil Procedure 23 or its state law equivalent. See In re Vioxx
Products Liability Litigation, ____ F.Supp.2d ____, 2012 WL 10552, *7-8 (E.D. La.
2012) citing Washington v. Chimei Innolux Corp., 659 F.3d 842 (9 th Cir. 2011), West
Virginia ex rel. McGraw v. CVS Pharmacy, Inc., 646 F.3d 169 (4 th Cir. 2011), cert.
denied, ____ U.S. ____, 132 S.Ct. 761, 181 L.Ed.2d 484 (2011), and LG Display Co.,
Ltd. v. Madigan, 665 F.3d 768 (7 th Cir. 2011).17

16

Additionally, given the predominance requirement of Rule 23, it is unlikely that any proposed
class could be certified. Although there are common liability issues, the myriad of uncommon disparate
questions requiring individualized proof, including specific causation, medical causation, damages and
other issues individual to each plaintiff's alleged injury, would probably preclude a finding of
predominance. See Steering Committee v. Exxon Mobil Corp., 461 F.3d 598, 601-04 (5th Cir. 2006) and
Amchem Products, Inc. v. Windsor, 521 U.S. 591, 117 S.Ct. 2231 (1997).
17

This conclusion is buttressed by the separate provisions which authorize removal of a "mass
action" in § 1332(d)(11), discussed below. Section 1332(d)(11)(A) excludes from the definition of "mass
actions" those civil actions that fall within the scope of 28 U.S.C. § 1711(2). Section 1711(2) provides:
The term "class action" means any civil action filed in a district court of the United
States under rule 23 of the Federal Rules of Civil Procedure or any civil action that is
removed to a district court of the United States that was originally filed under a State
statute or rule of judicial procedure authorizing an action to be brought by 1 or more
representatives as a class action"
If an action removed under 1332(d)(2) as a "class action" included cases which were not filed as
representative actions authorized by a State statute or rule of procedure that authorizes a class action,
there would have been no need for Congress to have provided separate removal provisions for "mass
actions" which do not meet these procedural requisites.

7

Stated differently, there is no CAFA jurisdiction under § 1332(d)(2) unless the suit
has been brought as a representative action under a Rule 23 equivalent in state court. See
Id. That is not the case here. A plain reading of the statutory definition of “class action”
therefore necessarily excludes this case. Accordingly, this court lacks jurisdiction under
CAFA's provisions pertaining to "class actions."
This does not end the court's jurisdictional inquiry. While the removing
defendants removed this case under CAFA as a "class action", under § 1332(d)(11),
CAFA also authorizes removal of a "mass action." A “mass action” is defined as “any
civil action . . . in which monetary relief claims of 100 or more persons are proposed to be
tried jointly on the ground that the plaintiffs' claims involve common questions of law or
fact.” 28 U.S.C. § 1332(d)(11)(B)(i). In their Opposition to the instant Motion, the
removing defendants argue that the plaintiffs' action qualifies as a "mass action" under
CAFA, and, accordingly, this court has jurisdiction. The undersigned disagrees.
A “mass action” must satisfy the same three threshold jurisdictional requirements
applicable to "class actions": (1) the aggregate value of the claims exceeds $5,000,000;
(2) there are at least 100 class members; and (3) there is minimal diversity, that is, where
at least one plaintiff and one defendant are from different states. 28 U.S.C.
§ 1332(d)(11)(A); 28 U.S.C. § 1332(d)(2); Coleman v. Price Co., 2012 WL 1118767, * 2
(E.D. La. 2012).
However, in addition to these threshold requirements §1332(d)(11)(B)(i) further
requires that jurisdiction extends only to those plaintiffs who seek recovery in excess of
8

$75,000. 28 U.S.C. § 1332(d)(11)(B)(i); Coleman, 2012 WL 1118767 at *2.
Plaintiffs argue, in the alternative, that their claims are not subject to CAFA's
"mass action" provisions because the defendants have failed to establish that each
plaintiff asserts claims worth more than $75,000 in damages, citing the stipulation set
forth in their Petition and the lack of any evidence submitted by the removing defendants
to contradict their allegations. The removing defendants, however, argue that the
plaintiffs' stipulation is ineffectual and that the plaintiffs have failed to carry their burden
of establishing, to a legal certainty, that their claims do not satisfy the $75,000 threshold.
The courts have wrestled with the question of whether all plaintiffs in a mass
action must have a minimum amount in controversy of $75,000 each in order for the court
to have jurisdiction, or whether the court can individually remand those plaintiffs whose
claims are determined to be below the $75,000 threshold, thus rendering the $75,000
threshold non-jurisdictional.
The Eleventh Circuit in Lowery v. Alabama Power Company 483 F.3d 1184 (11 th
Cir. 2007) recognized the question, but never answered it because the court determined
that the defendant had failed to meet its preliminary jurisdictional obligation of showing
the aggregate amount in controversy to be over $5,000,000. Lowery at 1206-1207
(“Because we hold . . . that the defendants have not established the $5 million aggregate
amount in controversy, we need not decide today whether the $75,000 provision might yet
create an additional threshold requirement that the party bearing the burden of

9

establishing the court's jurisdiction must establish at the outset, i.e., that the claims of at
least one of the plaintiffs exceed $75,000”).18 In so doing, the court suggested that the
provision could not be read as requiring all plaintiffs in a mass action have a minimum
amount in controversy of $75,000. Id. at 1204.
The Ninth Circuit, however, answered the question in Abrego v. Dow Chemical
Company, 443 F.3d 676 (9 th Cir. 2006), concluding that the threshold requirement to be
borne by the party trying to demonstrate the existence of jurisdiction under
§ 1332(d)(11) is to show that there is at least one plaintiff whose claim exceeds $75,000.
Abrego at 689 ("Dow [the removing defendant] has not established that even one plaintiff
satisfies the $75,000 jurisdictional amount requirement of § 1332(a), applicable to mass
actions by virtue of § 1332(d)(11)(B)(i)" accordingly, remand was required).
The Ninth Circuit reasoned that, regardless of whether removal under CAFA was
proper based on the aggregate amount in controversy, “the case cannot go forward unless
there is at least one plaintiff whose claims can remain in federal court.” Id. Thus,
because the removing defendant failed to satisfy its burden of establishing "that any
plaintiff's claim satisfies the $75,000 jurisdictional requirement" in either the notice of
removal or in response to the district court's order requiring the removing defendant to
18

In a latter footnote, the Lowry court noted that although it found the defendants' argument that
the burden of proving which, if any, of the plaintiff's claims exceed the $75,000 threshold should be
borne by the plaintiffs, compelling, the court nevertheless declined to address the issue. Lowery, 483 F.3d
at 1208, n.55 (“The defendants urge us to read Evans as shifting the burden onto the plaintiffs to prove
which, if any, of the plaintiffs do not have claims exceeding the $75,000 amount in controversy included
in 28 U.S.C. §1332(d)(11)(B)(i). Although we find the argument quite compelling, we decline to address
it here”).

10

provide a factual basis to support a finding that the $75,000 threshold was satisfied by
"the claims made by any single plaintiff . . . remand of each and every plaintiff to state
court was appropriate." Id. at 689-690 (emphasis in original).
In this case, as in Abrego, the removing defendants have not established, either in
their notice of removal or in response to the instant Motion to Remand, that even one
plaintiff satisfies the $75,000 jurisdictional amount requirement of § 1332(a), applicable
to mass actions by virtue of § 1332(d)(11)(B)(i). In their Notice of Removal, the
removing defendants do not even allege that the $75,000 threshold set forth in
§ 1332(d)(11)(B)(i) exists, much less that it is satisfied by any plaintiff in this action.
Likewise, in response to the instant Motion, the defendants presented no evidence
to support a finding that the $75,000 threshold is satisfied by "the claims made by any
single plaintiff." Instead, the removing defendants merely argue that the plaintiffs'
stipulation in their Petition is ineffectual, without first demonstrating, by a preponderance
of the evidence, that the $75,000 threshold is met by any single plaintiff.
In cases such as this, where the plaintiffs have affirmatively alleged the amount in
controversy is below the jurisdictional minimum for diversity jurisdiction, that amount
controls if made in good faith. St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S.
283, 289, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938). Consequently, the plaintiff's claim
remains presumptively correct unless the defendant can show by a preponderance of the
evidence that the amount in controversy is greater than the jurisdictional amount.

11

DeAguilar v. Boeing Co., 47 F.3d 1404, 1412 (5 th Cir. 1995).
A defendant satisfies this burden either by showing that it is facially apparent that
the plaintiff's claims exceed the jurisdictional amount or by setting forth the facts in
dispute supporting a finding that the jurisdictional amount is satisfied. Allen v. R & H Oil
& Gas Co., 63 F.3d 1326, 1335 (5 th Cir. 1995). The preponderance burden forces the
defendant to do more than point to a state law that might allow the plaintiff to recover
more than what is pled. DeAguilar, 47 F.3d at 1412. The defendant must produce
evidence that establishes that the actual amount in controversy exceeds $75,000. Id.
Once a defendant meets his burden to show that the amount in controversy exceeds
the jurisdictional amount, removal is proper, unless the plaintiff shows that it is legally
certain that his recovery will not exceed the amount stated in the state Petition. Id. Thus,
at this point, for a court to refuse jurisdiction, “it [must] appear to a legal certainty that the
claim is really for less than the jurisdictional amount." Id. citing St. Paul Mercury, 303
U.S. at 289, 58 S.Ct. at 590.
In this case, the defendants have submitted no evidence to support a finding by a
preponderance of the evidence that the amount in controversy for any plaintiff's claim in
this action exceeds $75,000. Rather, the defendants assert that the $75,000 threshold is
facially apparent because the types of damages sought to be recovered by the plaintiffs in
this case are similar to the categories of damages sought to be recovered by the plaintiffs

12

in In re Exxon Chemical Fire 19 , where the Fifth Circuit found the $5,000,000 amount in
controversy requirement satisfied. More specifically, the removing defendants
conclusorily assert that on the basis of In re Exxon Chemical Fire, the "Defendants have
established that the Plaintiffs claims meet the threshold $5,000,000 jurisdictional
requirement for CAFA application, and also that Plaintiffs' claims individually meet the
$75,000.00 amount in controversy requirement for this action to be properly considered a
"mass action" under CAFA." 20
The defendants’ reasoning is unpersuasive for many reasons, most notably,
because Magistrate Judge Hanna expressly rejected this reasoning in two other actions
arising from the Multi-Chem New Iberia explosions and fire which were removed to this
court by these same defendants, albeit on the basis of diversity jurisdiction under
§ 1332(a). See Broussard v. Multi-Chem, 6:11-cv-1280, Rec. Doc. 24; Mergist v. MultiChem, 6:11-cv-1821, Rec. Doc. 21.
In those cases, Judge Hanna reasoned that the type of damages sought to be
recovered does not determine whether the $75,000 amount in controversy requirement has
been satisfied, the amount of damages sought to be recovered governs the inquiry, and the
defendants had presented no evidence to establish that amount. Id. He further reasoned
that although there are certain situations in which the nature of the alleged injury or the

19

20

558 F.3d 378, 388 (5th Cir. 2009).
Rec. Doc. 13, pg. 6.

13

type of damages claimed will support a conclusion that the amount-in-controversy
threshold has been crossed, this case is not such a case. Id. Further, Judge Hanna
rejected the defendants' reliance on In re Exxon Chemical Fire because the Fifth Circuit
did not find that the jurisdictional amount was facially apparent because of the types of
damages claimed by the plaintiffs, but instead, the court was merely making two
consecutive points: Exxon met its burden, and certain types of damages were claimed.
Id.
Finally, as in Judge Hanna's cases, the defendants cited no other cases to compare
the plaintiffs’ claims with awards in similar cases. Perhaps this is so because, as noted by
Judge Hanna, awards in similar chemical release cases do not approach the jurisdictional
threshold. 21 See Id. citing Howard v. Union Carbide Corp., 50 So.2d 1251, 1256 (La.
2010) citing In re New Orleans Train Car Leakage Fire Litigation, 903 So.2d 9 (La. App.
4 th Cir. 2005), writ denied, 922 So.2d 1171 (La. 2006).
This case differs than those considered by Judge Hanna because of the plaintiffs'

21

Judge Hanna wrote as follows:
[Howard held] that an award in the range of $100 to $500 per plaintiff was appropriate when the
“claimants suffered relatively minor symptoms from their exposure, such as watering eyes, nose or throat
irritation, coughing, and headaches. None of the claimants sought or required medical attention as a
result of the exposure. They were not required to evacuate from the area as a result of the chemical
release, nor did they miss any work or school.” This was contrasted with an award of $5,000 to $15,000
for physical damages and from $2,000 to $5,000 for mental anguish awarded in another Louisiana statecourt chemical release case. In the latter case, the chemical release took place over a three-day period, the
plaintiffs living near the site were displaced from their homes, some of them sought medical treatment,
and some had physical or mental symptoms that lasted for a period of months. Based on the scant
information supplied by the plaintiffs in their Petition in the instant case, it appears that the plaintiffs in
this case might have sustained injuries worse than those in the first cited case but perhaps not as bad as
those in the second cited case. Even if their injuries were as bad as those of the plaintiffs in the second
case, however, their damages would not approach the jurisdictional threshold.

14

request for punitive damages. However, in the absence of evidence or comparison cases
supporting an award exceeding the $75,000 threshold in similar cases, the undersigned
cannot find that this request would tip the scales over the jurisdictional threshold of any
single plaintiff. This is particularly true in this case given that it is not entirely clear that
punitive damages are available in this case; the claim is asserted under Texas law in this
Louisiana state court action.
For these reasons, the undersigned finds that the defendants have failed to satisfy
their burden of proof demonstrating that any single plaintiff's claim exceeds this court's
$75,000.00 jurisdictional minimum. As was the case in Abrego, regardless of whether
removal under CAFA was proper based on the $5,000,000 aggregate amount in
controversy, “the case cannot go forward unless there is at least one plaintiff whose
claims can remain in federal court." Remand is therefore properly granted.
Furthermore, even if the removing defendants had established that any plaintiff's
claim exceeded the $75,000 jurisdictional minimum, the plaintiffs have demonstrated
that this action is nevertheless not properly before this court under the “event or
occurrence” exclusion to "mass action" removal.
Under the "event or occurrence" exclusion, the term “mass action” excludes any
civil action in which “all of the claims in the action arise from an event or occurrence in
the State in which the action was filed, and that allegedly resulted in injuries in that State
. . . .” 28 U.S.C. § 1332(d)(11)(B)(ii)(I).

15

The removing defendants argue that this exclusion does not apply because the
plaintiffs have alleged "injury-causing conduct" which occurred in the State of Texas.
More specifically, the removing defendants argue that the plaintiffs' claim for punitive
damages, asserted under Texas law, and involving allegations of tortious conduct by
personnel in Multi-Chem's headquarters in the State of Texas precludes application of the
exception in this case. In essence, the removing defendants argue that the "event or
occurrence" referred to by the statute must be conduct of the defendant occurring in
Louisiana, not out-of-state conduct of the defendant resulting in in-state injuries.
The undersigned cannot except this strained interpretation of the statute. The
exception clearly does not focus not on the defendant's conduct. Rather, the exception
focuses on whether the plaintiffs' claims "arise from" a single event or occurrence in the
forum state that results in injuries in the forum state. The event or occurrence is therefore
the in-state injury producing incident itself that gave rise to the plaintiff's claims for
injuries sustained in-state, not the in-state or out-of-state conduct of any defendant which
may have caused or contributed to the incident. In this case, that singular injury
producing incident was the June 14, 2011 explosion and fire that occurred Multi-Chem’s
New Iberia, Louisiana facility.
The legislative history of CAFA supports the court's interpretation, making clear
that the exception was intended to apply “only to a truly local single event with no
substantial interstate effects” in order to “allow cases involving environmental torts such
as a chemical spill to remain in state court if both the event [the chemical spill] and the
16

injuries were truly local, even if there are some out-of-state defendants” S.Rep. No.
109–14, at 47 (2005), reprinted in 2005 U.S.C.C.A.N. 3, 44.
Accordingly, courts have consistently construed the "event or occurrence"
language to apply only in cases involving a single event or occurrence in the forum state,
such as an environmental accident, chemical spill or a building collapse, that gives rise to
the plaintiffs' claims for injuries suffered in the forum state. Abednego v. Alcoa, Inc.,
2011 l 941569 (D. Virgin Islands 2011); Mobley v. Cerro Flow Prods., Inc., 2010 WL
55906 (S.D. Ill. 2010); Clayton v. Cerro Flow Prods, Inc., 2010 WL 55675 (S.D. Ill.
2010); see also Lafalier v. Cinnabar Serv. Co., Inc., 2010 WL 1486900, at *4 (N.D. Okla.
2010) citing Galdasti v. Sunvest Communities USA, LLC, 256 F.R.D. 673, 676 (S.D.
Fla.2009) and Cooper v. R.J. Reynolds Tobacco Co., 586 F.Supp.2d 1312, 1316 (M.D.
Fla. 2008).
In finding the "event or occurrence" exception applicable under a similar factual
scenario, the Virgin Islands District Court in Abednego v. Alcoa, Inc. found as follows:
In our view, the plain meaning of CAFA's mass action exception
encompasses this action. The Third Amended Complaint alleges the
occurrence of a release of bauxite, red mud, and asbestos from an alumina
refinery in St. Croix as a result of Hurricane Georges on September 21,
1998. Plaintiffs maintain that defendants' negligence from improperly
containing these hazardous substances caused them personal injuries and
property damage. The release penetrated into the neighborhoods
surrounding the refinery on that same island. All injuries alleged in the
Third Amended Complaint resulted from personal and property exposure to
hazardous substances released on St. Croix as a result of that one hurricane.
Despite the fact that a number of the plaintiffs subsequently moved away
from the Virgin Islands, their property damages and personal injuries were
incurred when on St. Croix.
17

*

*

*

This exception from the contours of a mass action in CAFA was specifically
designed to apply to circumstances such as are pleaded in the plaintiffs' Third Amended
Complaint. Alleged here is a chemical release or spill precipitated by a hurricane that
struck St. Croix. The injuries happened to persons and property near the alumina refinery
from which the chemicals were released. . . .

The plaintiffs' Third Amended Complaint does not qualify as a mass action under
CAFA because all the claims arise from a single event or occurrence, that is, a hurricane,
in the Virgin Islands, where the action was originally filed, and the allegedly resulting
injuries occurred in the Virgin Islands. See 28 U.S.C. § 1332(d)(11)(B)(ii)(I).
Abednego, 2011 l 941569 at *3-4.
As was the case in Abednego, the court finds that the "event or occurrence"
exception was specifically designed to apply to the circumstances pleaded in the
plaintiffs' Petition. The plain meaning of CAFA's mass action "event or occurrence"
exception clearly encompasses this action.
The Petition alleges the occurrence of a release of hazardous fumes from a MultiChem facility in New Iberia, Louisiana as a result of an explosion and fire on June 14,
2011. Plaintiffs maintain that defendants' negligence caused them personal injuries and
property damage. The release penetrated into the neighborhoods surrounding that facility
in New Iberia, Louisiana, and all injuries alleged in the Petition were incurred in, and
resulted from, personal and property exposure to the hazardous fumes released in New
Iberia, Louisiana as a result of that one explosion and fire.

18

To read the exception as suggested by the defendants ignores the plain language of
the statute and relevant legislative commentary which comports with the interpretation
this court has adopted.22 For this reason, the undersigned concludes that the "event or
occurrence" exception applies, excluding this action from qualifying as a "mass action"
under CAFA, and thereby requiring this court to remand this action to state court.
Request for Costs, Expenses and Attorney’s Fees
Plaintiffs also move under 28 U.S.C. § 1447(c) for an award of costs, expenses and
attorney’s fees against the removing defendants for improper removal of this case. This
court has discretion to award costs and expenses, including attorney’s fees, incurred as a
result of improper removal. Martin v. Franklin Capitol Corp., 546 U.S. 132, 126 S.Ct.
704, 709 (2005); Allstate Insurance Company v. Ford Motor Company, 955 F.Supp. 667,
670 (W.D.La. 1996). “Absent unusual circumstances, courts may award attorney’s fees
under § 1447(c) only where the removing party lacked an objectively reasonable basis for
seeking removal. Conversely, when an objectively reasonable basis exists, fees should be
denied.” Martin, 126 S.Ct. at 711 citing Hornbuckle v. State Farm Lloyds, 385 F.3d 538,
541 (5 th Cir. 2004) and Valdes v. Walmart Stores, Inc., 199 F.3d 290, 293 (5 th Cir. 2000).
Under the unusual legal and factual circumstances presented in this case, the undersigned
cannot find that the removal in this case was objectively unreasonable. Accordingly,
plaintiff’s request for costs, expenses and attorney fees will be denied.

22

“The court notes that although "it is error to cloud the plain meaning of a statutory provision
with contrary legislative history, it is appropriate to refer to [legislative history]" where "the legislative
history comports with the interpretation that has been adopted . . . .” Cooper v. R.J. Reynolds Tobacco
Co., 586 F.Supp.2d 1312, 1321 (M.D. Fla. 2008) quoting Lowery, 483 F.3d at 1205.

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CONCLUSION
Based on the foregoing, the plaintiffs’ Motion to Remand will be GRANTED,
subject to the stay set forth in the accompanying order, and this lawsuit will be remanded
to state court. It is further ordered that plaintiffs’ request for costs, expenses and
attorney’s fees will be DENIED.
Signed May 21, 2012, at Lafayette, Louisiana.

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