In Re: Methyl Tertiary Butyl Ether ("MTBE") Products Liability Litigation

Filing 4278

TRANSCRIPT of Proceedings re: motion held on 10/15/2015 before Judge Shira A. Scheindlin. Court Reporter/Transcriber: Thomas Murray, [phone]. Transcript may be viewed at the court public terminal or purchased through the Court Reporter/Transcriber before the deadline for Release of Transcript Restriction. After that date it may be obtained through PACER. Redaction Request due 11/23/2015. Redacted Transcript Deadline set for 12/3/2015. Release of Transcript Restriction set for 1/30/2016.(McGuirk, Kelly)

1

Fafrmtbm
1
2
3

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------x

4

In Re: METHYL TERTIARY BUTYL
ETHER ("MTBE") PRODUCTS
LIABILITY LITIGATION

5

------------------------------x
New York, N.Y.
October 15, 2015
3:00 p.m.

6
7
8
9

00 Civ. 1898 (SAS)

Before:
HON. SHIRA A. SCHEINDLIN
District Judge

10
11
12
APPEARANCES
13
14
15
16

JACKSON GILMOUR & DOBBS P.C.
Attorneys for Plaintiff Commonwealth of Puerto Rico
BY: JOHN D.S. GILMOUR
VICTOR L. CARDENAS, JR.
ORLANDO MARTINEZ
SCOTT KAUFF

17
18
19

SEDGWICK LLP
Attorneys for Shell defendants
BY: RICHARD E. WALLACE, JR.
RUBEN F. REYNA

20
21
22

MCDERMOTT WILL & EMERY LLP
Attorneys for ExxonMobil Defendants
BY: JAMES PARDO
MICHAEL DILLON

23
24
25

SANCHEZ-BETANCES, SIFRE & MUNOZ-NOYA PSC
Attorneys for Defendant Peerless Oil & Chemicals
BY: ADRIAN SANCHEZ-PAGAN
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

2

Fafrmtbm
1
2

THOMPSON & KNIGHT LLP
Attorneys for Defendant Petrobras America
BY: JAMES B. HARRIS

3
4
5

KING & SPALDING LLC
Attorneys for Defendants
BY: JEREMIAH J. ANDERSON

6
7

SEPULVADO & MALDONADO, PSC
Attorneys for Defendant Total Outre Mer
BY: ALBENIZ COURET FUENTES

8
9
10

MOUND COTTON WOLLAN & GREENGRASS
Attorneys for Trammo defendants
BY: BARRY R. TEMKIN

11
Also Present:
12
13
14

ROBERT WILSON
MEGHANA SHAH
STEPHAN DILLARD (tel.)
LISA MEYER (tel.)
RANDY GRAY (tel.)

15
16
17
18
19
20
21
22
23
24
25
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

3

Fafrmtbm
1

(Case called)

2

THE COURT:

We are here today for oral argument on two

3

pending motions.

They both turn on the this question that's

4

been raised before and is being raised again about the tolling

5

rules and which case out of Puerto Rico applies.

6

defense motions.

These are

There is a motion in Puerto Rico I for summary

7
8

judgment, and two defendants, Shell Western Supply and Trading

9

and Shell International Petroleum Company Ltd., are added by

10

the third amended complaint, which was filed December 3, 2012.

11

They move for summary judgment on the basis the statute of

12

limitations had run by the filing of the third amended

13

complaint.

14

They make this argument because they say that the

15

Puerto Rico high court case of Fraguada, which was decided

16

August 13, 2012, controls and says there can't be the unlimited

17

tolling of the earlier case, Arroyo, but that going forward the

18

one-year period applies.
The other motion is in Puerto Rico II.

19

There has

20

never been a decision yet in the Puerto Rico II case.

The

21

Puerto Rico II case alleges injury of 36 new service station

22

sites.

23

requested in Puerto Rico I.

It also requests islandwide relief similar to that

24

The current motion in Puerto Rico II alleges that the

25

islandwide claims are duplicative of those that were raised in
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

4

Fafrmtbm
1

Puerto Rico I and should be dismissed under the prior pending

2

action doctrine.

3

time-barred as to the Puerto Rico II defendants that were in

4

the Puerto Rico I complaint as well as the two defendants that

5

are added for the first time in Puerto Rico II.

6

two grounds to be argued.

7

Defendants also say that the claims are

So there are

Given that these are defense motions and that the

8

Puerto Rico I motions relate to Shell, would you like to begin

9

the argument, Mr. Wallace?

10

MR. WALLACE:

Thank you, your Honor, I would.

May I

11

begin with a question?

12

rehashing the points that were presented in the papers.

13

you have questions, I presume that the chief issue that brings

14

us here today concerns the prospective application of the

15

Fraguada case.

16

THE COURT:

17

MR. WALLACE:

I don't want to take your time
Unless

That's true.
Then let me start with that.

I know I'm

18

making a point that is altogether too familiar with you because

19

you have decided this issue now, as we view it, on three

20

different occasions:

21

granted, and a motion for reconsideration.

Two motions to dismiss, which were

22

It pleases me to be able to say as the first point of

23

my argument that we believe you are absolutely right and don't

24

see any reason to revisit, much less reverse, the decisions

25

that you made previously.
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

5

Fafrmtbm
1

THE COURT:

Well, Mr. Wallace, it may trouble you to

2

hear, as opposed to please you to hear, that I now have doubts

3

that I was right on July 16, 2013, August 2, 2013, and December

4

30, 2013.

5

primarily in Puerto Rico, and the reasoning in those cases and

6

the consistency of those rulings, I now have reason to think

7

that I got it wrong and that maybe I have to revisit and vacate

8

and reverse my earlier rulings.

9

is, I don't think any of them were reduced to final judgment.

10

As I have read the developing cases coming down,

Is that true?

11

MR. WALLACE:

12

THE COURT:

13
14
15
16

One question I have for you

To my knowledge, that's correct.

If that's true, then under rule 54(b) this

Court would have power to revisit all of those rulings.
MR. WALLACE:

Your Honor, I'll leave it to the

defendants -THE COURT:

Who are in those cases to talk about that,

17

right, I understand that.

But the opening is certainly there.

18

Since these motions raise the identical issue, I'm just saying

19

if I was wrong then, I have an opportunity to be right now both

20

on these motions and potentially with respect to those.

21

do want to hear a full merits argument, so to speak, and not

22

have you just rely on the fact that, hey, you have ruled three

23

times, there is no need to do anything more but to say I agree

24

with myself, please sit down.

25

MR. WALLACE:

Understood.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

So I

6

Fafrmtbm
1

THE COURT:

That's not where I'm thinking.

2

MR. WALLACE:

Understood.

I can appreciate that given

3

the number of cases that have been presented, the Court would

4

have some questions and, as you put it, perhaps doubts.

5

that a thorough review of those cases will lead you to

6

conclude, of course, that you were correct.

7

I hope

I would like to begin not with the intervening cases

8

but with Fraguada itself.

That is the only word we have from

9

the Puerto Rico supreme court.

You may appreciate this

10

already, but I was somewhat surprised to learn myself that the

11

intermediate appellate courts in Puerto Rico have limited

12

authority, if you will.

13

prepared to address this if the Court has questions about this

14

point in particular.

15

I have asked Mr. Sanchez to be

My understanding is that the intermediate appellate

16

courts in Puerto Rico, which are creatures of relatively recent

17

origin, having been created in the '90s, are governed by a

18

judiciary act which expressly states that they do not have the

19

authority to essentially set the law in Puerto Rico, that their

20

decisions have whatever precedential effect other courts,

21

including even lower courts, in Puerto Rico choose to accord to

22

them, but they do not have stare decisis effect even in those

23

courts, much less in this court.

24
25

So, as we look at those intermediate appellate courts,
we should bear in my mind that they may be instructive, you
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

7

Fafrmtbm
1

might find them useful, but you certainly are not bound by

2

them.

3

THE COURT:

I accept that I am not bound.

4

MR. WALLACE:

Correct.

The Puerto Rico supreme court

5

decision in Fraguada itself, however, is quite different in

6

that that is the controlling decision.

7

THE COURT:

8

MR. WALLACE:

9

that decision.

For sure.
I won't belabor your interpretation of

But I will say, at least this was my

10

impression, on comparing your decisions, in particular the

11

August 2013 decision on reconsideration, with all the other

12

decisions that the plaintiffs have brought before you, yours, I

13

submit, contains the most thorough, incisive, and instructive

14

analysis.

15

Many of those other decisions from the intermediate

16

appellate courts simply say, almost in passing, Fraguada shall

17

have prospective effect, and then teach us nothing more about

18

what prospective effect means.

19

that prospective effect means that the rule announced in that

20

case, as distinct from the Arroyo rule, shall apply to --

21

paraphrasing, but I think I have this close to an exact

22

quote -- all causes of action filed after the date of the

23

Fraguada decision itself in August 2012.

24
25

THE COURT:

I think Fraguada teaches us

Even if that were right, and I'm not sure

that I agree with that any longer, but assuming it were right,
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

8

Fafrmtbm
1

the third amended complaint was filed December 3rd, which is

2

three and a half months later.

3

statute of limitations after the tolling ends --

4

If there is suddenly a one-year

There was tolling under Arroyo, we agree with that?

5

When Arroyo existed, there was tolling.

6

controlling, there was tolling as to after-added defendants.

7

That was the whole rule of Arroyo.

8

MR. WALLACE:

9

When Arroyo was

Surely you agree with that.

I'm not sure I agree.

10

THE COURT:

11

MR. WALLACE:

12

THE COURT:

That's what Arroyo held.

It was tolling.

Yes, indeed, so long as the Arroyo rule

remained in effect.

13

Honestly, I have not thought about that.

Correct, it was tolling.

We are in

14

agreement.

15

If Fraguada is issued August 13th, you get a year.

16

you're right that anything filed a day after Fraguada is

17

controlled by Fraguada, this third amended complaint is good

18

because it was filed within three and a half months.

19

within the one year.

20

when I studied these motion.

21

The tolling doesn't end until Fraguada is issued.
So, even if

So it is

That is something that occurred to me

I wasn't sure I was right at all because of the

22

intervening Puerto Rico cases.

But then I said, even if I was

23

right, they get a year, they were tolled until Fraguada became

24

the controlling decision.

25

tolling can't end when it was in effect.

Up to then, Arroyo tolled.

The

It has to end when

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

9

Fafrmtbm
1
2

Fraguada comes down, and then you get a year.
MR. WALLACE:

Unless you view it this way:

In

3

Fraguada the court abrogated the rule of Arroyo and said it

4

shall not apply henceforth.

5

THE COURT:

6
7
8
9

There you go, henceforth.

You're tolled

until it comes down.
MR. WALLACE:

Perhaps you're reading more into

Fraguada than the court intended.
THE COURT:

I don't think so.

Otherwise, you would

10

have an injustice.

11

is this whole question of fairness and justice.

12

effect for a while there.

13

Fraguada comes down.

14

otherwise, there is a complete unfairness.

15

When you read the intervening cases, there
Arroyo was in

You can't be barred the minute

You have to get the year at that point;

MR. WALLACE:

Two points.

So I'm troubled.

I believe that Fraguada

16

instructed courts not to apply Arroyo again after the date of

17

that decision.

18

tolling period based on Arroyo, you are applying Arroyo

19

contrary to Fraguada.

20

And, I submit, in granting the plaintiffs this

THE COURT:

I don't think so.

I would be applying

21

Fraguada if I say you have only a year.

The next case we are

22

going to turn to is the Puerto Rico II complaint filed

23

September 4th.

24

Fraguada comes down August 13th.

25

discussion with whichever counsel is going to argue Puerto Rico

That actually is just over a year because
I have to have a different

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

10

Fafrmtbm
1

II.

But any way you slice it, Fraguada gives you a year and

2

you are tolled until Fraguada comes down.

3

problem for you, Mr. Wallace.

4

MR. WALLACE:

So there is a real

I do take your point.

If you hold

5

firmly to that position, I want the opportunity to think more

6

about what the import is of that construction of Fraguada.

7

you permit me, perhaps we might submit a short letter following

8

the hearing.

9

if we accept the premise that Fraguada gives the plaintiffs the

10

And perhaps not.

If

Perhaps we will agree with you

benefit of another year of tolling.
THE COURT:

11

It virtually has to, because Arroyo gave

12

you unlimited tolling, and that doesn't end until Fraguada

13

comes down.

14

I feel very strongly about this.

15

injustice.

So you have to have the year Fraguada gives you.
Otherwise, you would have an

What I admire about you as a lawyer is at least you

16
17

are open to think about what I am saying and not deciding here

18

and now.

19

it, you may write a letter, you may say, gosh, she may be right

20

about that.

21

You need to think about this idea.

I don't know.

MR. WALLACE:

You may reject

But you need to think about it.

Allow me just one more point on this

22

particular subject.

23

about fairness.

24

Arroyo was inequitable, that it was unfair.

25

I appreciate what the Court is saying

It must be.

THE COURT:

But Fraguada also teaches us that

Yes, you're right.

But it was there, on

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

11

Fafrmtbm
1

the books, and everybody relied on it.

2

mediate decisions that you say have little or no reasoning.

3

I'm not sure I agree with a that.

4

the fairness of reliance, which is why they say when the

5

amended complaint is filed later on, those folks have relied on

6

Arroyo and can't be punished midstream, so to speak, for their

7

fair reliance on a case from the highest court of Puerto Rico.

But all of them talk about

It was a supreme court case, it was controlling, and

8
9

That is the inter-

everybody had an opportunity to rely on the supreme court, just

10

like we all rely on the United States Supreme Court until it

11

overrules itself, which it has been prone to do lately.

It

12

shouldn't do that, but it has on very important issues.

But

13

OK.

14

MR. WALLACE:

15

Then the question becomes, is there some

sort of grace period?

16

THE COURT:

Fraguada says one year.

17

MR. WALLACE:

18

is your construction.

19

the Arroyo rule was unfair, it was unjust, and henceforth

20

Arroyo is abrogated.

21

THE COURT:

22

MR. WALLACE:

I don't recall that.

I understand that

But what Fraguada tells us expressly is

That's right, henceforth.
Which I construe to mean from now on the

23

plaintiff doesn't get the benefit of the extended tolling

24

period that Arroyo already granted them.

25

more than a year already to add the defendants.

This commonwealth had

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

12

Fafrmtbm
THE COURT:

1

But they were operating it correctly,

2

relying on Arroyo, that there was no time limit, that they

3

could, whenever they learned of it or became aware of it, they

4

could then file.

5

the highest court of Puerto Rico said you no longer have that

6

right.

They had the right to rely on Arroyo until

Then they have a year.

7

MR. WALLACE:

8

THE COURT:

9

At least that is my view.

Understood.

But that is only one argument.

We could

also go back to the other argument that those intermediate

10

courts in Puerto Rico are right:

That even if it was more than

11

a year, the Arroyo rule applies to cases that were filed before

12

Fraguada; even as they proceed over the years post-Fraguada,

13

they have a right to continue under the Arroyo rule because

14

they were filed under Arroyo.

15

MR. WALLACE:

We need to cover that, too.

As I construe the total of 19 cases the

16

plaintiffs cited, there are 5 that fit the description you just

17

provided.
THE COURT:

18

There are almost none the other way.

19

counted mine three times.

20

other way.

21

three times.

22

They didn't say a word.

23

it's time-barred, and didn't explain the reasoning at all.

24

Those two are pretty weak.

25

judge.

You

So you said there are five going the

But three were mine.

If I'm wrong once, I'm wrong

The other two, they really had no reasoning.
They just said it's post-Fraguada, so

And I think they were by the same

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

13

Fafrmtbm
Again, it was three of mine and two of one other

1
2

judge, so only two judges took that position.

3

judges who have read it said it would be fundamentally unfair

4

for a case that was filed under the Arroyo regime to midstream

5

come under the Fraguada regime.

6

apply to Puerto Rico II because Puerto Rico II is a newly filed

7

case, filed post-Fraguada.

8

MR. WALLACE:

9

THE COURT:

All the other

Interestingly, that doesn't

Absolutely.

That's a different story.

10

the Puerto Rico II motion also?

11

MR. WALLACE:

12

THE COURT:

Are you arguing

On the Fraguada point.

Good.

I think that is a different case.

13

That is not an amended complaint.

That is not an Arroyo filed

14

case.

15

it is not within the one-year statute of limitations.

That is a Fraguada filed case.

Either it is timely or

My only question on Puerto Rico is II is when the

16
17

commonwealth knew or should have known about those 36 new

18

sites.

19

with Arroyo or Fraguada; it's a statute of limitations argument

20

under a one-year statute of limitations, no problem about that.

21

But there I'm confronted with the islandwide claim.
MR. WALLACE:

22
23

If it's timely within the year, it's got nothing to do

Exactly.

That is the focus of the

motion.

24

THE COURT:

It doesn't talk about the 36 new claims?

25

MR. WALLACE:

I don't believe so.

I think we conceded

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

14

Fafrmtbm
1

those -THE COURT:

2

I thought it said if the defendants are in

3

Puerto Rico I and they are now in Puerto Rico II, even if it's

4

on new sites -MR. WALLACE:

5

I believe that the defendants are

6

reserving the right after discovery to move for summary

7

judgment on limitations if it turns out that the evidence shows

8

the commonwealth was aware of those sites.
THE COURT:

9
10

one year.

11

Then it is barred because it was more than

But it is not because they were defendants in Puerto

Rico I?
MR. DILLON:

12

Your Honor, Michael Dillon.

One of the

13

points that we made in the Puerto Rico II motion to dismiss was

14

that inasmuch as the commonwealth claims islandwide relief,

15

they claimed that against the defendants in Puerto Rico I as

16

well.

17

on notice of the amendment.

18

claim is time-barred in Puerto Rico II as to the original

19

defendants.
THE COURT:

20
21

So if you were on notice of your injury, you were also
Therefore, that islandwide relief

Because you knew of it for more than a

year.

22

MR. DILLON:

23

THE COURT:

Right.
It has nothing to do with the Arroyo/

24

Fraguada problem, it's because it's beyond the one-year statute

25

of limitations.
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

15

Fafrmtbm
1

MR. DILLON:

2

THE COURT:

3

That's right.
Do we have a Fraguada issue in Puerto Rico

II for you to talk about?
MR. WALLACE:

4

We don't really think so, for precisely

5

the reason you suggested.

6

the islandwide claims in Puerto Rico II were tolled by the

7

assertion of those claims in Puerto Rico I.
THE COURT:

8
9
10

But under my interpretation, they would

have to lose that because it is more than one year after the
Fraguada decision that they filed.
MR. WALLACE:

11
12

The commonwealth might argue that

Yes.

Let me say just a few more words

on the two cases that ruled consistent with --

13

THE COURT:

The one judge, two cases.

14

MR. WALLACE:

Well, two panels in two cases.

In one,

15

you are quite right that they didn't articulate much in the way

16

of a rationale or reasoning.

17

the first of the two, the amended complaint in that case was

18

filed in May 2013.
THE COURT:

19
20

on each of those.

21

But in the Ocasio Nieves case,

Give me a minute to find it.

ahead.

22
23

I want to get to that one.

I have notes

MR. WALLACE:

I'm sorry.

In that case, as your notes may reflect,

the amended complaint --

24

THE COURT:

25

MR. WALLACE:

Go

That's the Ocasio Nieves one?
Yes.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

16

Fafrmtbm
1

THE COURT:

Go ahead.

2

MR. WALLACE:

The amended complaint at issue was filed

3

in 2013.

That's within one year of Fraguada.

4

the court held there that the claims were timed barred.
THE COURT:

5

Nevertheless,

But it didn't consider the prospective

6

language at all.

7

that's the end of it.

8

MR. WALLACE:

9

It just said, we're applying Fraguada and

I think that's right fair, although it

would be unfair to say they didn't mention whether --

10

THE COURT:

They didn't mention it.

11

MR. WALLACE:

Right.

The other case, Cubero Aponte,

12

this was October 2014, it's against the so-called triple A, the

13

AAA.

14

THE COURT:

I've got it.

15

MR. WALLACE:

In that case, interestingly, it was the

16

commonwealth, this very party, that sought and received

17

dismissal based on Fraguada in a case where the original

18

complaint and the amended complaint were both filed before

19

Fraguada.

20

have been that Fraguada applies to all questions of limitations

21

presented after the date of that decision, even where the

22

defendant was added to the case prior to Fraguada.

23

go further, indeed they did go further, and obtain the benefit

24

of that argument in this other case than we submit you need to

25

go, further than you did go in the prior decisions.

So, the commonwealth's position in that case must

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

They would

17

Fafrmtbm
1

THE COURT:

Further in what sense?

2

MR. WALLACE:

In holding that Fraguada can apply even

3

where the newly added defendant was added before the date of

4

Fraguada.

5

THE COURT:

6

MR. WALLACE:

7

THE COURT:

8

MR. WALLACE:

9

I have that issue?
That's what the commonwealth argued.

But I don't have that issue.
No, it's not before you.

That's why I

say they went further than you did before or you need to now.

10

In urging that Fraguada applies, they must have construed

11

"prospectively" to mean --

12

THE COURT:

That's quite the leap, since they didn't

13

mention the word "prospective."

14

I agree with you that you never know what a court considered in

15

the privacy of its chambers.

16

any consideration of that language in either the Ocasio Nieves

17

or Cubero Aponte case.

18

MR. WALLACE:

Right.

Again, they just didn't do it.

But the decision does not reflect

While we are still on the

19

subject of these intermediate appellate decisions post yours,

20

let me correct my earlier math.

21

previously construed as irrelevant because the original

22

complaint and the amended complaint were both filed before

23

Fraguada, and therefore it is unremarkable that the Court would

24

conclude that Fraguada did not apply.

25

THE COURT:

There are three cases that we

Correct.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

18

Fafrmtbm
MR. WALLACE:

1

But in these three cases, the Court in

2

its analysis addressed not merely the filing of the original

3

complaint but also the date when the amended complaints were

4

filed as, though there was some significance that attached to

5

that.

6

position we are advancing and the decisions that you made

7

previously.

8

I think their analysis is consistent with both the

THE COURT:

I don't think so.

I think they were just

9

saying that's such an easy case, it shouldn't detain us any

10

longer, that obviously Fraguada applies prospectively, it's

11

this, and it can't apply to what happened before it issued.

12

think they were just saying those are so easy, there is not

13

much to talk about.

14

MR. WALLACE:

I agree with you.

I

I'm not sure the

15

commonwealth does, and I'm quite sure the commonwealth did not

16

in that Cubero Aponte case.

17

that these decisions, informative as they are, may be useful to

18

you in your analysis, but they do not, in our view at least,

19

constitute an intervening change of the law.

20

think you would conclude that they constitute an intervening

21

change in the law.

22

THE COURT:

In any event, let me reiterate

Indeed, I don't

That is to say that is not a standard I

23

need to meet.

I don't have to prove an intervening change in

24

the law in order to vacate and reverse my earlier decisions,

25

which is not your argument today anyway because you are leaving
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

19

Fafrmtbm
1

that to those lawyers.

2

is not my burden.

3

But I don't need to prove that.

instances, but I don't.

That

The lawyers have to prove that in certain
So that is not relevant to me.

4

A change in the law would have to come, as you said,

5

from the legislature or the highest court, not from this non-

6

binding intermediate court.

7

weight of authority developing, a judge -- I say "you."

8

judge sees the weight of authority developing and you see five,

9

seven, nine, whatever, cases all disagreeing with you, it's

10

like a jury.

11

I get that.

But when you see the
When a

and think.

12

When eleven people disagree with you, you stop

We tell that to jurors all the time:

When the

13

majority disagrees with you, you should at least stop and

14

think, could I be wrong?

15

That's what I'm doing.

16

maybe I did that too quickly and too easily and I just said

17

anything that happens after Fraguada is controlled by Fraguada;

18

but it may not be that simple because you, the party, relied on

19

Arroyo at least up until Fraguada issued, at least until then.

20

Some would argue if you are a pre-Arroyo filing there

21

is not even a one-year statute, you're just tolled forever, as

22

you were under Arroyo, and you may add parties today and it

23

wouldn't matter.

24

Fraguada comes down, you are on notice your tolling years are

25

over, now you get your one year; you had no reason to sue until

That is a standard charge of ours.

I'm stopping and thinking:

You know,

I may reach the intermediate notion that when

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

20

Fafrmtbm
1
2

then because you were open and covered by the Arroyo ruling.
MR. WALLACE:

I do appreciate, of course, your

3

sensitivity to the fairness as you have described it that must

4

be accorded to the commonwealth.

5

appreciate that, as Fraguada itself teaches us, applying the

6

Arroyo rule giving the commonwealth the benefit of tolling from

7

2007 until 2012 plus another year works an injustice as well,

8

this to the defendants.

9

THE COURT:

But I hope you, too,

I'm not sure that's fair.

10

controlled.

11

Arroyo

Much as you might not have liked that rule, that

was the law of the land in Puerto Rico.

12

MR. WALLACE:

13

THE COURT:

Understood.

Whether you liked it or not, were it being

14

dealt an injustice, that was the law and everybody had a right

15

or an obligation to live under it.

16

yet another year.

17

MR. WALLACE:

18

THE COURT:

What you find troubling is

Yes, exactly.

To me, to shut it down when you had no

19

notice that you were under a limit seems unfair, too.

20

no reason to act.

21

until you decided to add parties.

22

You had Arroyo.

MR. WALLACE:

You had

You thought you were tolled
That was the law.

I do appreciate it, but a couple of

23

points to put this fairness issue in context.

Arroyo, of

24

course, applies, and Fraguada itself, only in the instance of

25

joint and several liability -SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

21

Fafrmtbm
1

THE COURT:

Correct.

2

MR. WALLACE:

-- among different defendants, and it's

3

so.

In this case, for example, on the Shell motion, if you

4

were to decide that Arroyo does not apply in any respect and

5

from the date of Fraguada on there is no benefit of tolling,

6

that's how we construe it, the commonwealth would be deprived

7

of the ability, based on the time-barred defense, to assert the

8

claims against these two defendants who are allegedly jointly

9

and severally liable for several sites.

But they still have,

10

by definition, other jointly and severally liable defendants

11

responsible for the claims they assert; otherwise, we wouldn't

12

even be talking about Arroyo applying any tolling.
THE COURT:

13
14

I understand.

have one defendant, why do they need three.

15

MR. WALLACE:

16

THE COURT:

17

You're saying they at least

Exactly.

There is such an obvious answer to that, I

won't bother explaining it to you.
MR. WALLACE:

18
19

cases, the five cases.

20

Let me spend just a moment or two on the

cases --

21

THE COURT:

22

MR. WALLACE:

I think I'm correct in saying five

Oh, yes.
-- by other courts, the one in Puerto

23

Rico federal court and four intermediate appellate decisions,

24

that, to put it in shorthand, go the commonwealth's way.

25

believe that the federal court did not really provide any
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

I

22

Fafrmtbm
1

analysis that is useful to you, and comparing your decisions

2

with it is hardly a fair comparison because your decisions

3

include that thoughtful analysis and they do not.

4

THE COURT:

5

MR. WALLACE:

6

THE COURT:

7
8
9

Which one was that, by the way?
Santiago-Lampon.

Thank you.

Hold on, I want to read it.

Go ahead.
MR. WALLACE:

Then there are these that I will

describe as similar in an important respect:

10

Diaz, and Lozada Maldonado.

11

Davis Davis, Diaz

ones, in September 2013.

12

THE COURT:

13

MR. WALLACE:

Diaz Diaz was one of the earlier

I see it.

Go ahead about those three.

In each of those three, I submit the

14

court conflated important terms that we believe actually

15

dictate the result here.

16

Fraguada used when it said that henceforth or subsequently

17

causes of action filed shall be decided in accordance with the

18

rules that case announced.

19

Causes of action.

I have in mind the terms that

As I construe that term, a cause of

20

action is a claim, if you prefer, that is asserted, and in the

21

instance of my clients asserted for the first time post-

22

Fraguada.

23

mean something different.

24
25

Those courts, each of them, construed the term to

In Diaz Diaz, for example, the court actually quoted
Fraguada and said that "The intention of Fraguada when stating
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

23

Fafrmtbm
1

that," quote, 'hereinafter all causes of action according to

2

article 1802 shall be adjudicated in accordance with the rules

3

established herein,'" and now the Court goes on, "was to

4

establish that this rule would apply to suits for damages filed

5

after August 13th."

6

Therefore, it concluded that since no new suit had

7

been filed in that case, the fact that the amended complaint

8

was filed subsequently to Fraguada did not exempt it from the

9

Arroyo rule.

The court again construed causes of action to

10

mean suits as though Fraguada would only apply in a case such

11

as PR II, that is, a completely new suit.

12

THE COURT:

Actually, I never found a date for the

13

amended complaint in Diaz Diaz.

The complaint was 2010, but I

14

don't know that we have a date for the amended complaint.

15

MR. MARTINEZ:

16

docket and found them.

17

May 2010 and then the amended complaint on October 2012.

18
19

THE COURT:

Your Honor, if I may, we went into the
The dates are the original complaint on

As you can see, it wasn't in the opinion,

so you wouldn't have known when it was anyway.

20

MR. WALLACE:

21

THE COURT:

Right.

That would have been, within my

22

interpretation, under the year.

23

Fraguada.

24
25

It was two months after

Go ahead.

MR. WALLACE:

Similarly, in that Lozada Maldonado

case, the original complaint was 2011, the amended complaint
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

24

Fafrmtbm
1

was 2013.

2

action prosecuted on subsequent dates would be subject to

3

Fraguada, but then goes on to say that in the case before it,

4

the claim was filed before the supreme court established the

5

new doctrine.

6

the suit, that is, the original complaint, because it's plain

7

from the facts that the amended complaint was filed after

8

Fraguada.

I take it that reference to "claim" must mean

THE COURT:

9
10

The court again cites Fraguada, says that causes of

But it may have added parties to a

preexisting claim.
MR. WALLACE:

11

Perhaps.

But in that event I would

12

consider that claim as asserted against the defendants to have

13

been a new cause of action.

14

THE COURT:

You are adding a parenthetical that isn't

15

there.

16

amended complaint.

17

to a preexisting claim.

18

The claim may well have preexisted the filing of the
What you are doing now is adding defendants

MR. WALLACE:

I think that is a fair construction.

19

What is the cause of action?

20

Fraguada tells us determines whether Arroyo applies or

21

Fraguada.

22

THE COURT:

When was that filed?

That's what

I think a cause of action and a claim are

23

synonymous.

It still raises the question of as against whom.

24

There is a claim, let's say, of a defective product.

25

is there.

It has one defendant.

The claim

Now it suddenly has two more.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

25

Fafrmtbm
1

But the claim existed prior to Fraguada.

2

two new defendants, but it existed.

3

claim seven in a complaint.

4

MR. WALLACE:

Not as against the

It was claim three or

That is a fair point.

Now, if we look

5

at that claim being amended to bring in new defendants, at that

6

point I submit is when the cause of action against those new

7

defendants was filed.

8

THE COURT:

For sure.

9

MR. WALLACE:

This court, I submit, was badly mistaken

10

when it construed Fraguada to mean that it only applies to

11

cases that are filed after Fraguada and not causes of action.

12

That's how I interpret that case.

13

Likewise, if you look at the Davis Davis case, it says

14

that Fraguada does not apply because the complaint was filed

15

two years earlier, in 2010.

16

improper construction of Fraguada.

17

I submit that, too, was an

Granted, insofar as I can recall, none of these cases

18

addressed the important point that you have raised, whether

19

Fraguada allows yet another year after it is decided.

20

be grateful if, as you think through this, you read the

21

language at the end of Fraguada, which I take to mean the Court

22

intended that its rule would apply from that date forward in

23

all cases.

24
25

I would

I understand it would help the commonwealth maybe
reduce some what might otherwise be considered injustice to the
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

26

Fafrmtbm
1

commonwealth.

But likewise, it would work what the supreme

2

court tells us was an injustice and inequity to the defendants.

3

THE COURT:

4

everyone relied on.

5

was an unjust law or not, it was on the books and everybody

6

relied on it during that time.

7

Yes, but one that existed and that
It was the law of the land.

Once we get to repeating ourselves, that's a bad sign.

8

I understand your arguments.

9

this supplemental letter?

10
11

MR. WALLACE:

THE COURT:

13

MR. WALLACE:

14

THE COURT:

15

MR. WALLACE:

16

THE COURT:

18

How long would you like to submit

Please don't say very long.

It shouldn't take but a week for us to

decide in reviewing the cases whether to submit one at all.

12

17

Whether it

Next Friday, the 23rd?
Perfect.

Maximum.
Thank you.

Does anybody else from the defense side

wish to be heard before I hear from the plaintiff's lawyer.
MR. DILLON:

Michael Dillon.

Your Honor, only if you

19

wanted to hear more about the Puerto Rico II action or the

20

motion to dismiss.

21
22
23
24
25

THE COURT:

I do primarily with regard to the

islandwide claim.
MR. DILLON:

My question for your Honor is do you want

to wrap up the Shell West motion first?
THE COURT:

No.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

27

Fafrmtbm
1

MR. DILLON:

Your Honor, I will quickly summarize at

2

least our position on the islandwide relief sought in the

3

Puerto Rico II complaint.

4

dismiss relief, not just claims.

5

duplicative to the extent they seek islandwide relief, prophy-

6

lactic relief on an islandwide basis predicated on specific

7

relief sites or receptor sites.

8

thing in Puerto Rico II only in this case for 36 sites, again

9

seeking islandwide relief.

10

THE COURT:

The Court possesses the power to
The relief sought here is

They are seeking the same

You're saying if somebody was a defendant

11

in Puerto Rico I and is now a defendant in Puerto Rico II, that

12

defendant was already the subject of a request for islandwide

13

relief based on other sites but it's the same relief?

14

MR. DILLON:

That is certainly the case, even for new

15

defendants, your Honor.

16

doesn't just apply to defendants in an original action.

17

the prior pending action doctrine says is that so long as there

18

are not significant differences, in other words, between the

19

claims, the relief sought, and the defendants --

20

THE COURT:

The prior pending action doctrine
What

There are by definition significant

21

differences among the defendants if they weren't a defendant in

22

a lawsuit, because no one knew they were potentially liable.

23

If now they are a defendant because a new release at a new site

24

was located, there is not overlap as to those new defendants.

25

MR. DILLON:

Granted your Honor.

Except that the case

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

28

Fafrmtbm
1

law informing the prior pending action doctrine says as long as

2

their interests were represented in the prior suit.
THE COURT:

3

How could they be?

They weren't a

4

potentially liable party, so how were their interests

5

represented?
MR. DILLON:

6
7

islandwide relief.

I think in this instance plaintiffs seek

That will be defended against.

8

THE COURT:

9

MR. DILLON:

Right?

Yes.
In the same action, the same relief is

10

sought, just on a smaller section of sites.

11

that you don't get to seek that relief twice.
THE COURT:

12
13

defendants.

14

The doctrine says

I can see that as to the prior named

I'm not sure I see it as to the newly named

defendants.
MR. DILLON:

15

Maybe I can say it better this way, your

16

Honor.

17

in this case islandwide relief, will be adjudged in the first

18

instance; therefore, it's duplicative in the second, it need

19

not be addressed.

20

The prior pending action doctrine holds that the thing,

THE COURT:

I don't understand how that can be so

21

against defendants who were not exposed to liability the first

22

time around.

23

seeking that relief against new and different parties?

24
25

Why should the commonwealth be precluded from

MR. DILLON:

Your Honor, speaking for ExxonMobil, my

client, who was in the initial suit -SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

29

Fafrmtbm
1

THE COURT:

2

MR. DILLON:

3

THE COURT:

4

I get that.

MR. DILLON:

-- that is obviously not an issue for us.
No.
The prior pending action doctrine,

5

however, holds that to the extent that plaintiffs' interests

6

were represented in the first suit, and defendants are

7

obviously defending against those claims to the extent that

8

they are now in the second action --

9

THE COURT:

10

New defendants?

MR. DILLON:

New defendants.

-- their interests will

11

be represented as well as in the first as to the islandwide

12

relief claim.

13

THE COURT:

OK.

Thank you.

14

Who is arguing for the plaintiffs?

15

MR. GILMOUR:

Mr. Gilmour?

John Gilmour, your Honor.

Your Honor, I

16

would like to begin, if I may, by addressing the concerns

17

regarding the two cases that don't go the commonwealth way, to

18

use the defendants' quote.

19

THE COURT:

20

MR. GILMOUR:

21

THE COURT:

22

MR. GILMOUR:

23

From Puerto Rico?
Yes, your Honor.

OK.

Remind me of which two those are.

Yes, your Honor.

It's Ocasio and

Cubero.

24

THE COURT:

Cubero Aponte.

25

MR. GILMOUR:

Yes, your Honor.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

30

Fafrmtbm
1

THE COURT:

OK.

2

MR. GILMOUR:

The Puerto Rico appellate court, as I

3

understand it, has 39 justices, and they are divided into 7

4

geographic regions, judicial regions.

5

out of the Bayamon region.

6

exact same panel.

7

exact same three-judge panel.

As you noted, your Honor, it is the

It's not just a single judge.

It's the

Two weeks after the Cubero decision, the exact same

8
9

These opinions all came

panel decided Gonzalez Rivera, in which they did analyze Arroyo

10

versus Fraguada, and they did hold that the date of the

11

original complaint controlled and they did hold that Arroyo

12

controlled.

THE COURT:

13
14

So they changed their mind, your Honor.
I'm sorry.

You lost me.

So, that same

panel.

15

MR. GILMOUR:

16

THE COURT:

17

MR. GILMOUR:

18

Court, your Honor.

19

That exact same panel, yes, your Honor.

What is the name of that case?
Gonzalez Rivera.

We provided it to the

It is 2014 WL 7370134, and it was October

22, 2014.

20

THE COURT:

21

MR. GILMOUR:

22

That same panel then said?
They analyzed Fraguada versus Arroyo and

said that Arroyo applies.
THE COURT:

23

Give me a moment.

I had Gonzalez Rivera

24

here.

This was a case where there was a voluntary dismissal

25

based on improper service of the summons, there was a new
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

31

Fafrmtbm
1

summons, and the court applies Arroyo to find a refiled claim

2

not barred because the original case was filed before Fraguada.
MR. GILMOUR:

3

Yes, your Honor.

Although we can talk

4

about Puerto Rico II after this, I just wanted to put a

5

bookmark here because this is an instance where the complaint

6

after the new summons was issued was filed post-Fraguada.

7

issue is that because the original complaint was pre-Fraguada,

8

Arroyo applied even though --

9

THE COURT:

11
12

So this isn't an amend complaint at all.

MR. GILMOUR:

10

The

This is a new complaint, your Honor,

yes.
THE COURT:

They are essentially relating it back.

13

They are saying there was improper service, here is a new

14

summons, it's a refiling, so we are going to use the earlier

15

filed date.

16

That's almost a relation back type argument.

MR. GILMOUR:

Yes, your Honor.

As we will discuss,

17

the commonwealth's position is that the vast majority of these

18

cases, and this is not disputed by the defendants, is not only

19

that five cases hold that the original complaint filing date

20

controls, it's in excess of a dozen that state that rule.

21

THE COURT:

Factually, all dozen are not on point.

22

Some of those dozen, the original complaint and the amended,

23

are before Fraguada, for example, so they don't factually fall

24

into the same pattern.

25

MR. GILMOUR:

That's correct, your Honor.

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

If you look

32

Fafrmtbm
1

through the variety of cases, there are about six different

2

procedural postures that are before the judges.
THE COURT:

3

Correct.

Even in Gonzalez Rivera, is it

4

really fair to say that that same panel reversed itself?

5

it say and we look back on our two decisions in Ocasio Nieves

6

and Cubero Aponte and say they are wrong?
MR. GILMOUR:

7
8

No, your Honor.

Did

If I used the word

"reversed" -THE COURT:

9

I don't think you did.

I'm just asking

10

you.

You are saying they took a different position but not on

11

identical facts.

12

The summons was bad, they refiled it and said essentially it

13

relates back.

I think there one filing predated Fraguada.

14

Is that what you are going stand and say, Mr. Wallace?

15

MR. WALLACE:

Yes, your Honor.

I don't read the cases

16

even involving filing a new complaint.

17

right that the court simply issued a new summons to the correct

18

address.

19

THE COURT:

20

MR. WALLACE:

I think you're quite

Correct.
None of these cases concern the issue

21

before you where cause of action is first asserted after

22

Fraguada.

23

THE COURT:

24

MR. GILMOUR:

25

Go ahead, Mr. Gilmour.
Your Honor, I can go through them if you

want, but I think the most important thing is to focus on the
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

33

Fafrmtbm
1

five that are procedurally and factually similar to our case.

2

THE COURT:

Correct.

3

MR. GILMOUR:

Mr. Wallace stated that he had concern

4

about the use of the phrase "cause of action" in Fraguada and

5

afterwards.

6

I don't want to belabor the point.

7

that we all face in this case is that these cases are all in

8

Spanish.

9

Judge, you and I have had this discussion before.
But part of the challenge

They are being translated.
Early on we tried to reach agreement amongst the

10

parties to use a single translator or translation service.

11

were unable to reach that agreement.

12

translations going back and forth.

13

the factual challenge of one translation versus another, but I

14

would say I think what we are seeing here is an issue of

15

translation.

16

We

So we have multiple

I don't want to get into

What clarifies that for us is the post-Fraguada cases

17

that we have given your Honor -- again not universally, there

18

are some outliers that we discussed -- the vast majority state

19

the rule that the date of the original complaint controls

20

whether Arroyo applies or whether Fraguada applies.

21

in those five that are in our favor according to defendants

22

that that is so even where the complaints filed pre-Fraguada

23

and the amended complaint is filed post-Fraguada.

24
25

THE COURT:

It states

I think you gathered from my discussion

with Mr. Wallace that I would be troubled if five years after
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

34

Fafrmtbm
1

Fraguada you file an amended complaint relying on Arroyo.

That

2

would be troubling to me.

3

waiting to see what I might get in the letter, thinking about

4

Mr. Wallace's argument, I'm inclined to say you have to at

5

least get that year.

6

you win, you don't really care how you win.

But within that one year, as of now,

Which, frankly, covers you.

If you win,

So that's that.

With respect to Puerto Rico II, I think we must all

7
8

agree that's a new case filed post-Fraguada, so it's not really

9

part of this discussion.

It's either time-barred or not time-

10

barred other than issue where there is this duplicative relief

11

and the prior pending action controls, which has nothing to do

12

with Fraguada or Arroyo, it is just unrelated.

13

Rico II argument is really not an Arroyo/Fraguada argument, is

14

it?

15
16

MR. GILMOUR:

So the Puerto

It is, your Honor, as far as limitations

is concerned.

17

THE WITNESS:

Why?

18

MR. GILMOUR:

Because under Arroyo the filing of an

19

original complaint against even, say, one co-tort feasor tolls

20

the claims against all tort feasors that are jointly and

21

severally liable, even those that are not joined in that suit.

22

Under Arroyo, the First Circuit addressed an issue in the

23

Suzuki case where there was a suit filed against two

24

defendants, it was voluntarily dismissed, it was later filed as

25

to a completely different defendant, and Arroyo was applied and
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

35

Fafrmtbm
1

said that the limitations were tolled as to that later-added

2

defendant by the date of the original complaint against the

3

other two defendants.
THE COURT:

4

Even though the new case was not an

5

amended complaint, was it was a new case against a different

6

defendant, but for the same injury?

7

MR. GILMOUR:

8

THE COURT:

9

That court obviously had no Fraguada issue

to contend with.

10

MR. GILMOUR:

11

THE COURT:

12

Yes, your Honor.

Yes, your Honor.

That was that court's interpretation of

the Arroyo at the time.

13

MR. GILMOUR:

14

THE COURT:

15

MR. GILMOUR:

Yes, your Honor.

I understand that.
The commonwealth's position is that by

16

filing the initial complaint in 2007, it tolled limitations as

17

to all co-tort feasors for that injury.

18

THE COURT:

Basically ad infinitum, for eternity.

19

MR. GILMOUR:

20

THE COURT:

Yes, your Honor.

I can't believe that is a fair

21

interpretation of Fraguada, either.

Fraguada henceforth, in

22

other words, from the date of its assurance, takes effect.

23

real issue to me is that year given the reliance for the toll

24

period.

25

get in perpetuity under the Arroyo rule would make a bit of a

Fairness tells me you get a year.

The

To think that you

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

36

Fafrmtbm
1

mockery out of the Fraguada decision, which meant to eliminate

2

Arroyo.
After you get that year, then it is certainly fair to

3
4

shut it down.

5

except for the duplicative relief issue.

6

people and the statute didn't run until you knew or should have

7

known of them and you're timely within a year, you're OK

8

anyway.

9

But it is not much of an issue in Puerto Rico II
If you found new

It's the islandwide relief claim, which is not a

10

Fraguada argument.

11

doctrine says that if your interests were represented as

12

plaintiff, and they are, and the interests of the new

13

defendants are the same as the interests of the old defendants,

14

and so they are fairly represented, you don't get to seek that

15

relief in a second action.

16

pending action doctrine.

17

Mr. Dillon argues the prior pending action

MR. GILMOUR:

That's how he summarized the prior

I agree with that summary, your Honor.

18

What I would disagree with, my understanding is that defendants

19

are complaining claims versus relief.

20

THE COURT:

Yes.

He says you sought the same relief

21

in Puerto Rico I; it doesn't matter that you are adding timely

22

defendants in the sense of new sites, but you are seeking the

23

same relief that you sought in the first case and their

24

interests are protected by the original group of defendants.

25

Your interests are surely represented, you are the same
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

37

Fafrmtbm
1

plaintiff.
MR. GILMOUR:

2

A few things, your Honor.

One, we have

3

seen in prior cases in this very MDL that the relief cannot be

4

dismissed, it's the claim.

5

been having for some time is claim versus relief.

6

argue that the prior pending action doctrine is applicable to a

7

claim, not to sought relief.

8

of the trial judge at the end of the day, what relief is

9

granted.

10

So the conversation that we have
I would

The relief is at the discretion

So I think there is certainly protection there that

11

there will not be double recovery.

12

islandwide relief, your Honor.

13

specific remedies.

14

THE COURT:

15

MR. GILMOUR:

In this case they say

We prefer to call it nonsite-

I understand.
We are looking to clean it up.

The

16

issue is that it is not going to be duplicative.

I assure you,

17

and I'm stating it on the record, we do not want to try any

18

issues twice.

19

to all relevant defendants, we are done with that issue.

20

the extent that it is not and Puerto Rico II remains a separate

21

triable case, especially as to new defendants, then we have to

22

preserve that.

23

dismissal of the entire case or the entire claim against all

24

the defendants, which greatly prejudices the commonwealth,

25

particularly as to the 17 newly added defendants.

To the extent the issue is in Puerto Rico I as
To

Defendants, as they have moved, have sought the

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

38

Fafrmtbm
1

THE COURT:

Anything further, Mr. Gilmour?

2

MR. GILMOUR:

3

THE COURT:

Not unless you have any questions.

What is your view of my evolving thought

4

that once Fraguada comes down, you are subject to the end of

5

the tolling from Arroyo but now you are getting a year?
MR. GILMOUR:

6

Your Honor, the way that I read the

7

cases is that there is a bright-line rule and it's the date of

8

filing of the original complaint.

9

you feel that there is some unfairness that that would allow

I hear you, your Honor, that

10

tolling ad infinitum.

11

place to prevent unjustice.

12

tomorrow without seeking permission from the Court.

13

have to state our bases for amending the complaint tomorrow in

14

Puerto Rico I.

15

disagree.

For example, we could not amend
We would

Your Honor at the end of the day can agree or

THE COURT:

16

But the Court has procedural rules in

When you amended Puerto Rico I on December

17

3, 2012, how did you get to do that procedurally?

18

stipulated?

19

Court's permission then?

Was there a contested motion?

MR. GILMOUR:

20

Was it

How did you get the

It was requested, your Honor.

I know it

21

was discussed in some of the case management conferences.

22

That, unfortunately, is slightly prior to my involvement in the

23

case.

24
25

THE COURT:

The only reason I asked is I wondered

whether it was contested and I wrote a decision or the
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

39

Fafrmtbm
1

defendants just went along at that point in time.

2

they knew the argument.

3

defense counsel remember?
MR. WALLACE:

4

I don't remember.

Under Arroyo

Do any of the

As I recall it, your Honor, the

5

plaintiffs requested it in a letter exchange, and at a

6

conference and you indicated that if the defendants

7

contested --

8

THE COURT:

9

MR. WALLACE:
THE COURT:

10

They could always move to dismiss.
Exactly.

I always say that on amended complaint

11

cases.

I say there are two ways to do it procedurally:

Either

12

propose to amend or get it filed and then move to dismiss.

13

I don't think there is any waiver there, that's for sure.

So

With respect to your argument about protection, it

14
15

doesn't really apply because I didn't consider the merits of

16

this argument at that time but reserved the defendants' right

17

to move, which they now have.

18

MR. GILMOUR:

19
20

Yes, your Honor.

I mean going into the

future.
THE COURT:

I understand.

You're saying this time

21

around if we want to amend next week, they would again say it's

22

time-barred, and I would be where I am today hearing argument

23

on that issue.

24

same to me whether they oppose leave to amend or just move to

25

dismiss it, procedurally I have always preferred the latter:

Since I have always said procedurally it's the

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

40

Fafrmtbm
1

Get the thing filed, make your argument, you haven't waived

2

anything, and I'll rule.

3

argument.
MR. GILMOUR:

4
5

So that doesn't impress me as a major

If I may, your Honor, it wouldn't have

to be a time bar argument.

6

THE COURT:

No, right.

7

MR. GILMOUR:

The Court could simply find that it's

8

unfair to defendants, it's prejudicial to them, etc., and deny

9

leave to amend.

10
11
12

It's an entirely different legal issue than

tolling.
THE COURT:

Yes and no.

It could be a laches

argument, which is very similar.

13

MR. GILMOUR:

Yes, your Honor.

14

THE COURT:

15

whether you waited too long.

16

same coin, but I appreciate your point.

It raises all the same fairness issues of
I think it is two sides of the

17

I asked your response to that position.

18

is we don't like that one, either, we think we have Arroyo

19

tolling continually because our original complaint was filed

20

prior to Fraguada.

21

MR. GILMOUR:

22

THE COURT:

23

Anybody else?

24

MR. DILLON:

25

Your response

In sum, your Honor, yes.

Thank you.
Mr. Dillon.

Your Honor, just one point on Puerto Rico

II with regard to filing of a new complaint.

I know that

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

41

Fafrmtbm
1

several of the cases plaintiffs have cited suggest that

2

Fraguada applies to bar new actions -- Soto Lopez, Torres

3

Rodriguez, Ramos Miranda, and the Tartak case -- and we submit

4

so does Fraguada itself.

5

THE COURT:

6

MR. DILLON:

7

Say that again.
Sure.

You lost me.

The order issued by the court in

Fraguada also bars those prospectively, a new action.

8

THE COURT:

The order in Fraguada?

9

MR. DILLON:

10

THE COURT:

At the end of Fraguada, your Honor.
Says what?

I don't really know what we

11

are talking about.

It can't be right on the 36 new sites.

12

That's not joint and several, either.

13

defendants, are they not?

14

new defendants?

Those are new sites, new

Or is that a matter of old sites,

What is the 36 new sites?

15

MR. DILLON:

16

THE COURT:

17

MR. DILLON:

18

THE COURT:

19

MR. DILLON:

17 were old, your Honor.
17 what?
17 sites were old.
They are now new defendants?
They were separated and actually poured

20

back into the Puerto Rico I case.

21

sites.

22

old defendants.

23

So it is not truly 36 new

There were also new defendants in Puerto Rico II and

THE COURT:

I'm sorry.

There are sites in Puerto Rico

24

II that were in Puerto Rico I, but now they are adding

25

defendants, is that what you are saying?
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

42

Fafrmtbm
1

MR. DILLON:

2

THE COURT:

That's correct.
That would be a joint and several issue

3

that you would say would be controlled by Fraguada.

4

also new sites that were not in Puerto Rico I.

5

MR. DILLON:

6

THE COURT:

7

issue.

8

There are

That's right.
I don't see that that can be a Fraguada

OK, I understand.

new complaint.
MR. HARRIS:

9

There are both fact scenarios in the

If I might be heard very briefly on the

10

tolling grace period issue.

11

letter, but I think it is important to focus on the fact that

12

the rule of Fraguada was you look at when the cause of action

13

accrues and you have a year.

14

THE COURT:

15

year.

We will probably cover this in the

I know, but it can't be in the tolled

There was tolling in place.

That's what tolling is.

By the way, this has all been hashed out in class

16
17

action litigation.

When the class is not certified, you get

18

the year.

19

isn't running.

20

about the together analogy.

You know that.

When the toll is in place, the year

I don't think I want further argument.

Think

I forget the controlling case, but everybody knows it.

21
22

I just forget the name.

I wouldn't have forgotten ten years

23

ago, darn it.

24

Who knows the name of that case?

25

case.

Then, I remembered all names.
Nobody?

When it was tolled, it was tolled.

But no longer.

It's a very famous
Then if you don't

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

43

Fafrmtbm
1

certify, you get the year.

2

important.

3

Somebody will think of it.

Not

Pardo, even you.

It just shows we are all in the same shape.

4

MR. PARDO:

I'm right there with you.

5

THE COURT:

Mr.

Is there anything further on this

6
7

argument?

Mr. Gilmour?

MR. GILMOUR:

Your Honor, if I might ask, I just have

8

to ask, I don't know that a letter would be required, but if

9

defendants are going to file a letter in the week, may the

10

commonwealth be afforded the opportunity to respond if it feels

11

necessary?

12

THE COURT:

Yes but.

You have already told me your

13

position.

14

Judge, it's not a matter of a year or not a year, if the

15

complaint was filed pre-Fraguada, we're tolled in perpetuity,

16

that's our position.

17

You have already said, you're on the wrong track,

I suppose you could argue alternatively, yes, we were

18

entitled to the year and then you will site that class action

19

case I can't think of and say under that analogous rule we

20

should get the year.

21

It will be one paragraph citing one case, but that's fine.

22

can have it, too.

23

I can imagine what the letter will say.
You

If you get a letter and you want to say what I just

24

said, as an alternative we get the year, please get it in the

25

at the absolute latest October 30th.

Although I don't think it

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

44

Fafrmtbm
1

takes a week to write that, since I just dictated it.

2

MR. GILMOUR:

3

THE COURT:

Is now is there anything else?

4

MR. KAUFF:

Your Honor, I want to ask the Court, Mr.

5

Understood.

Thank you, your Honor.

Dillon spoke about the prior pending action arguments.

6

THE COURT:

Yes, he did.

7

MR. KAUFF:

I wanted to ask, do you want our argument

8

on that point or only on the statute of limitations aspects of

9

it?

10

THE COURT:

You mean now, your oral argument?

11

MR. KAUFF:

Right.

12

THE COURT:

Do you mean do you want to hear argument

14

MR. KAUFF:

Correct.

15

THE COURT:

Sure, go ahead.

16

MR. KAUFF:

He went beyond the statute of limitations.

13

now?

17

First, I want to point out the distinction between a claim and

18

relief as was discussed before.

19

defendants, in their prior pending action doctrine argument,

20

ignored the Second Circuit's decision in Devlin, where the

21

Second Circuit said there's an exception to the prior pending

22

action doctrine.

But in addition, the

23

THE COURT:

That exception is?

24

MR. KAUFF:

The exception is where the two cases are

25

before the same judge, that judge should consider consolidation
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

45

Fafrmtbm
1

in lieu of dismissal.

It remanded that case back and the

2

court, this court, did consolidate the action.

3

Devlin decision has now been followed by the Southern District

4

of New York in subsequent cases where the same judge is hearing

5

those cases.

That same

6

In lieu of dismissal, which is what the defendants are

7

requesting, in this extreme case where we have 17 new defendant

8

and new sites, the solution here is consolidation.

9

we have a pending motion to consolidate, as your Honor

10

discussed at the last case management conference.

11

That's why

I just

wanted to bring that to the Court's attention.

12

THE COURT:

13

Now is there anything further from anyone?

14
15

Thank you, Mr. Kauff.

you.
(Adjourned)

16
17
18
19
20
21
22
23
24
25
SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

No.

Thank