Chavez v. Occidental Chem. Corp.

• Decision Date: 10 January 2018
• Docket Number: 17 Civ. 3459 (PAE)
• Citation: 300 F.Supp.3d 517
• Parties: Tobias Bermudez CHAVEZ, et al., Plaintiffs, v. OCCIDENTAL CHEMICAL CORPORATION, Defendant.
• Court: U.S. District Court — Southern District of New York

300 F.Supp.3d 517

Tobias Bermudez CHAVEZ, et al., Plaintiffs,

v.OCCIDENTAL CHEMICAL CORPORATION, Defendant.

17 Civ. 3459 (PAE)

United States District Court, S.D. New York.

Signed January 10, 2018

Barbara H. Stratton, Knepper & Stratton, Wilmington, DE, Jonathan Massey, Massey & Gail LLP, Washington, DC, Rebecca Ruth Webber, Scott M. Hendler, Hendler Lyons Flores, PLLC, Austin, TX, for Plaintiffs.

Conor Paul McEvily, Donald Ferguson McNiel, III, Vinson & Elkins L.L.P., Houston, TX, Devon Charles Holstad, Vinson & Elkins L.L.P., New York, NY, Jennifer Marie Kinkus, Timothy Jay Houseal, William Edward Gamgort, Young Conaway Stargatt & Taylor, LLP, Wilmington, DE, for Defendant.

OPINION & ORDER

Paul A. Engelmayer, United States District Judge

In 1993, a group of individuals from countries including Costa Rica, Ecuador, and Panama filed a putative class action in Texas state court against a number of chemical manufacturers including, among others, the defendant here, Occidental Chemical Corp. ("Occidental"). The plaintiffs had all lived or worked on banana plantations. They alleged that they had suffered adverse health consequences as a result of exposure to a chemical pesticide called dibromochloropropane ("DBCP"). In 2010, some 17 years later, after a long train of procedural misadventures, the plaintiffs dismissed their claims voluntarily.

This case was filed in 2011, and, as filed, involved similar claims against substantially the same defendants. The plaintiffs here, however, were not parties to the original 1993 action. Nor are they subject to the 2010 dismissal. They were, however, absent members of the putative class: They are foreign nationals from Costa Rica, Ecuador, and Panama who, like the named plaintiffs in the 1993 lawsuit, allege tortious exposure to DBCP between the 1960s and early 1980s. Their claims against Occidental were transferred to this District in May 2017, following a circuitous procedural path that led from Louisiana (where the case was brought) to Delaware to (as against Occidental only) this Court. Occidental now moves for judgment on the pleadings, arguing that plaintiffs' claims are time-barred under New York law.

For the following reasons, the Court finds plaintiffs' claims timely and therefore denies Occidental's motion. The Court's ruling, however, turns on an important and unresolved question of New York law that has divided courts in this District: whether New York law tolls the statute of limitations for purported class members during the pendency of a class action filed in another state. The Court holds that New York law does provide for such tolling. Therefore, the Court holds, based on the long-running Texas litigation initiated in 1993, plaintiffs' claims were long tolled and are timely today. Further, in the interest of economy, the Court certifies this order for interlocutory appeal to the United States Court of Appeals for the Second Circuit.

I. Background¹

A. Factual Background

Occidental manufactured and distributed DBCP, a pesticide known to cause sterility, sexual and reproductive abnormalities, and cancer

. Compl. ¶¶ 8–10, 65. Plaintiffs allege that they were exposed to Occidental's DBCP when they lived and worked on or around DBCP-treated banana plantations in Costa Rica, Panama, and Ecuador. Id. ¶¶ 66–68. Because they were never informed of the dangers posed by DBCP, Plaintiffs allege, they did not wear any protective covering or respiratory equipment to prevent exposure. Id. ¶ 5. Asa result, they suffered a host of DBCP-related injuries, including sterility and increased risk of cancer. Id. ¶¶ 69, 186.

B. Procedural History

The procedural history of this case is baroque. The Court first reviews the two-decade-long history of the putative class actions (styled as Carcamo and, later, Delgado ) brought by plaintiffs bringing similar claims against defendants including Occidental. As explained, these cases have proceeded in Texas, Costa Rica, and Hawaii; none, however, resulted in the certification of a class. The Court then turns to the procedural history of this lawsuit (Chavez ), which arrived in this Court after pit stops in Louisiana and Delaware.

1. The Earlier Putative Class Actions in Texas, Costa Rica, and Hawaii

In August 1993, a putative class action was filed in Texas state court, captioned Carcamo v. Shell Oil Co., 93–C–2290. See JSPH ¶¶ 1–4; id. Exs. 1–4. The Carcamo complaint sought relief against Occidental and other chemical concerns for the exposure to DBCP of the named plaintiffs and the putative class. Id. Ex. 4. The Carcamo plaintiffs proposed to represent a class defined, as relevant here, as "[a]ll persons exposed to DBCP, or DBCP-containing products, designed, manufactured, marketed, distributed or used by [defendants including Occidental] between 1965 and 1990 in [countries including Costa Rica, Panama, and Ecuador]." Id. Ex. 6 at 2.

Before a motion for class certification was filed or resolved, however, the Carcamo defendants impleaded Dead Sea Bromine, a corporation indirectly owned in part by the State of Israel. Id. ¶ 7; id. Ex. 7. Dead Sea Bromine then removed the case to federal court, asserting jurisdiction under the Foreign Sovereign Immunities Act ("FSIA"). Id. ¶ 17; id. Ex. 7.²

The Carcamo case was assigned to Judge Sim Lake of the United States District Court for the Southern District of Texas. In June 1994, it was consolidated with a related matter, which together were re-captioned Delgado v. Shell Oil Co., No. H–94–1337. JSPH ¶ 8; id. Ex. 8 at 15.

In November 1994, Judge Lake issued a scheduling order directing the parties to provide, inter alia, their views on class certification, and stating the court's intention to resolve a series of dispositive motions, including any motions to dismiss for forum non conveniens. Id. ¶ 9; id. Ex. 9. Although the plaintiffs never filed a motion for class certification under Federal Rule of Civil Procedure 23, their letter to Judge Lake asserted that class treatment would be appropriate. Id. ¶ 10; id. Ex. 10. In their response, the defendants disputed that plaintiffs could satisfy Rule 23, id. ¶ 11; id. Ex. 11; the plaintiffs, in reply, reiterated their position, id. ¶ 13; id. Ex. 13. Several months later, but before class certification was briefed or decided, defendants moved to dismiss for forum non conveniens. Id. ¶ 14; id. Ex. 14.

On July 11, 1995, the court resolved the motion to dismiss in a published memorandum and order. See Delgado v. Shell Oil Co., 890 F.Supp. 1324 (S.D. Tex. 1995). It held first that jurisdiction was proper, including under the FSIA. It then conditionally granted the motion to dismiss on forum non conveniens grounds, reasoning that adequate alternative fora existed in the plaintiffs' home countries. Id. at 1372–73. The Court conditioned dismissal on, among other things, defendants participating in expedited domestic discovery and waiving certain procedural and jurisdictional defenses abroad. Id. The Court also issued an injunction barring plaintiffs from commencing any new DBCP-related actions. Id. at 1374–75. Finally, the Court noted that "a number of other motions" were pending. It held that "all pending motions ... not otherwise expressly addressed in this Memorandum and Order are DENIED as MOOT." Id. at 1375. The opinion did not address the merits of class certification.

The order did, however, include a "return jurisdiction" clause. It stated:

Notwithstanding the dismissals that may result from this Memorandum and Order, in the event that the highest court of any foreign country finally affirms the dismissal for lack of jurisdiction of any action commenced by a plaintiff in these actions in his home country or the country in which he was injured, that plaintiff may return to this court and, upon proper motion, the court will resume jurisdiction over the action as if the case had never been dismissed for [forum non conveniens ].

Id.

On October 27, 1995, after the defendants had satisfied the conditions the Court had set for dismissal, the Court entered a "Final Judgment" dismissing the consolidated actions and permanently enjoining plaintiffs and others with knowledge of the judgment from commencing new DBCP-related litigation. JSPH ¶ 17; id. Ex. 17. Significantly, in a separate order issued the same day, Judge Lake clarified that the injunction applied only to "plaintiffs (and intervenor plaintiffs) in the actions before the court," rather than "any potential plaintiff not before it." Id. ¶ 16; id. Ex. 16.

The plaintiffs immediately appealed the Court's exercise of subject-matter jurisdiction to the United States Court of Appeals for the Fifth Circuit. Id. ¶ 17.

Meanwhile, the Costa Rican plaintiffs prosecuted their claims in Costa Rica. However, they were rebuffed by Costa Rica's Supreme Court, which held that the Costa Rican courts lacked jurisdiction over the DBCP claims. See id. Ex. 21 at ¶ 14. As a result of that dismissal, in 1996, the Costa Rican plaintiffs moved for reinstatement of their claims before Judge Lake pursuant to the return jurisdiction clause. Id. Judge Lake denied the motion without prejudice, deferring final judgment on the motion pending resolution of the plaintiffs' appeal to the Fifth Circuit. See id. Ex. 24 at ¶ 4.

On October 19, 2000, the Fifth Circuit affirmed Judge Lake's judgment. See Delgado v. Shell Oil Co., 231 F.3d 165 (5th Cir. 2000). In April 2001, the United States Supreme Court denied certiorari. JSPH ¶ 19.

All the while, parallel litigation was underway in Hawaii. In 1997, a separate set of plaintiffs filed a DBCP class action in Hawaii state court. Id. ¶ 42. The case followed roughly the same procedural trajectory as the Delgado action: defendants impleaded Dead Sea Bromine; Dead Sea Bromine removed; the federal district court dismissed plaintiffs' claims on forum non conveniens grounds; and the plaintiffs appealed. Id. ¶¶ 43–46. In that case, however, the Ninth Circuit reversed, holding the district court lacked subject matter jurisdiction...