Exxon Mobil Corp. v. Ford

• Decision Date: 09 February 2012
• Docket Number: No. 1804,Sept. Term,2009.,1804
• Citation: 204 Md.App. 1,40 A.3d 514
• Parties: EXXON MOBIL CORPORATION v. Paul D. FORD, et al.
• Court: Court of Special Appeals of Maryland

204 Md.App. 1

40 A.3d 514

EXXON MOBIL CORPORATION

v.Paul D. FORD, et al.

No. 1804

Sept. Term

2009.

Court of Special Appeals of Maryland.

Feb. 9, 2012.

Charles P. Scheeler, Baltimore, MD (John E. Griffith, Jr., Jeffrey D. Herschman, DLA Piper LLP (US), Baltimore, MD, James F. Sanders, Thomas H. Dundon, Neal & Harwell, PLC, Nashville, TN, C. Carey Deeley, Jr., Venable, LLP, Towson, MD), on the brief, for appellant.

Stephen L. Snyder, Baltimore, MD & Robert J. Weltchek, Lutherville, MD (Michael B. Snyder, Snyder & Snyder, Baltimore, MD, Kristopher A. Mallahan, Weltchek, Mallahan & Weltchek, LLC, Lutherville, MD), on the brief, for appellee.

Panel: EYLER, JAMES R., EYLER, DEBORAH S., MEREDITH, WOODWARD, ZARNOCH, WRIGHT, GRAEFF, HOTTEN and WATTS, JJ.

PER CURIAM.

In accordance with Md.Code (1973, 2006 Repl.Vol.), Courts and Judicial Proceedings Article, § 1–403(c), a majority of the incumbent judges of this Court ordered this appeal from the Circuit Court for Baltimore County by appellant Exxon Mobil Corporation to be reheard in banc.

The in banc panel unanimously concludes: that counsel for Exxon Mobil did not waive the appellant's right to challenge the compensatory damage award; and that the circuit court did not err in admitting the testimony of appellees' expert witness on diminution in property values in Jacksonville as a result of the spill.

A majority of the panel determines that, with the exception of the property damage award to one family (the Grecos), the damage award for diminution in value shall be affirmed.

A majority finds that, under certain circumstances, Maryland law permits recovery for emotional distress related to reasonable fear of cancer. However, a different majority concludes that there was insufficient evidence of emotional distress for 53 Jacksonville residents. Thus, their judgment for this component of damages shall be reversed.

Although a majority of the panel determines that there was sufficient evidence of emotional distress to support a damage award for the remaining appellees, a different majority/plurality concludes that a faulty instruction on damages for emotional distress requires a new trial for these appellees.

A majority of the in banc panel would recognize a damage award for medical monitoring under certain circumstances. However, a different majority/plurality concludes that the evidence was insufficient to support such a remedy.

Therefore, the judgment of the Circuit Court for Baltimore County is affirmed in part and reversed in part and the case is remanded for proceedings consistent with this Court's mandate.

JUDGMENT FOR DIMINUTION IN VALUE IN FAVOR OF ANDREA GRECO AND VERONICA GRECO REVERSED. JUDGMENTS FOR DIMINUTION IN VALUE IN FAVOR OF ALL OTHER APPELLEES AFFIRMED.

JUDGMENTS FOR EMOTIONAL DISTRESS IN FAVOR OF LUKE DEKOOMEN, SETH DEKOOMEN, THOMAS BENNEY, LISA BENNEY, BARTLETT COLGAN, PATRICIA COLGAN, ELAINE LINDSEY, TRESIA PARKS, WATER MERSKI, ANTHONY MONTONE, VALERIE MONTONE, LEON NICKEL, THERESA NICKEL, RICCI DEPASQUALE, JR., JOSEPH DEPASQUALE, ALICIA DEPASQUALE, WYATT DOBB, DAVID FRITZ, JR., BRENDAN FRITZ, AIDAN FRITZ, MELO DIE HEGGIE, ROBERT LIBERTINI, JR., NICHOLAS LIBERTINI, MICHELLE SHINDLEDECKER, ZACHARY VACOVSKY, BROOK VACOVSKY, CHRISTOPHER VOGLER, CARLI VOGLER, STEVEN STELMACK, AMTUL BAIG, JOSEPH BATEMAN, DENNIS BERLIN, ALEXIS BLAIR, SPENCER BLAIR, ALLISON CARROLL, STEPHANIE CARROLL, JASON CARROLL, JOHN DEPASQUALE, MADISON DOBB, EMILY FABER, ALEXANDER FABER, KATHERINE LIBERTINI, DAVID MAHONEY, ROSEMARIE MAHONEY, LAUREN McLEWEE, LINDA OBERLIN, AMY PETERS, LESLIE RUSH, MARIA CHAVEZ, EVAN TIZARD, EMMA TIZARD, MARLENA WITTELSBERGER, AND LAUREN WITTELSBERGER REVERSED.

JUDGMENTS FOR EMOTIONAL DISTRESS IN FAVOR OF ALL OTHER APPELLEES REVERSED AND CASES REMANDED TO THE CIRCUIT COURT FOR BALTIMORE COUNTY FOR A NEW TRIAL ON THAT CLAIM CONSISTENT WITH THE MAJORITY/PLURALITY VIEWS OF THIS COURT.

JUDGMENTS FOR MEDICAL MONITORING IN FAVOR OF ALL APPELLEES REVERSED.

COSTS TO BE PAID ONE–HALF BY APPELLANT AND ONE–HALF BY APPELLEES WHOSE JUDGMENTS FOR EMOTIONAL DISTRESS OR MEDICAL MONITORING ARE REVERSED, IN EQUAL SHARES.

KRAUSER, C.J., MATRICCIANI, J., and KEHOE, J. did not participate in the argument or the decision in this case.

ZARNOCH, J., concurring and dissenting, in which MEREDITH, J., WOODWARD, J. and WRIGHT, J., join.

This appeal challenges a jury verdict awarding compensatory damages totaling over $147 million to hundreds of plaintiffs who claimed that appellant, ExxonMobil, was responsible for contaminating their groundwater with certain chemicals found in gasoline. Appellees, the plaintiffs, represent over 88 households in the Four Corners neighborhood of Jacksonville in Baltimore County, Maryland. It is undisputed that a leak at the Jacksonville Exxon station discharged over 700 gallons of gasoline per day for 37 days before it was discovered and shut down in February of 2007. The plaintiffs filed claims against ExxonMobil in the Circuit Court for Baltimore County alleging strict liability for an abnormally dangerous activity, private nuisance, trespass, negligence, and fraudulent concealment. ExxonMobil accepted liability for all of the claims except fraudulent concealment, disputing only causation and damages.

The trial began in October of 2008 and lasted for five months with the Hon. Maurice W. Baldwin presiding. The jury ultimately rejected the fraudulent concealment claim as well as the request for punitive damages. The $147 million compensatory award comprised both economic and non-economic damages, including diminution in value, emotional distress, fear of cancer, and the cost of medical monitoring. Appellant filed several post-trial motions requesting judgment notwithstanding the verdict, a new trial, or remittitur and asserted, inter alia, that the verdict was excessive and formulaic when compared to the evidence presented at trial. After a hearing, the circuit court ordered remittitur as to the diminution in value awards to four households that had sold their homes since the leak.¹ The court denied the remaining motions and upheld the verdict. Appellant noted this appeal.

FACTS & LEGAL PROCEEDINGS

The Leak

Because liability is not an issue in this appeal, I will discuss the events leading to the leak only briefly, in order to provide context for the disputed issues. This case began on a truly unfortunate Friday the thirteenth in January 2007, when a contractor working on the fuel delivery system at the Jacksonville Exxon station accidentally drilled a hole in an underground gas line.² The punctured line carried regular grade gasoline from the underground storage tank to the fuel pump. As a result of the leak, the electronic line leak detector automatically shut down the line and sounded an alarm, which was received by both Storto Enterprises, the station operator, ³ and Gilbarco Veeder–Root, a central monitoring company. Gilbarco notified an independent service contractor who issued an emergency work order to Alger Electric Inc.

Alger technicians arrived at the Jacksonville Exxon station within a few hours of the alarm. The technicians found no evidence of a gas leak and believed the problem was being caused by a faulty pump motor. Upon replacing the motor, however, the Alger technicians did not properly recalibrate the leak detector. The alarm therefore failed to signal the continuing leak. It was later established that approximately 700 gallons of gasoline per day leaked from the underground line, beginning January 13 and continuing for 37 days until the leak was finally discovered on February 17, 2007. Storto's station operator, Andrea Loiero, testified that she and the station manager noticed a discrepancy in their daily inventory during the time of the leak. The parties dispute when and how often ExxonMobil was informed of this inventory discrepancy. It is clear, however, that on February 16, Loiero reported the large discrepancy to an ExxonMobil territory manager, who advised her to shut down all of the gas pumps. The territory manager arrived at the station within an hour. After examining the records and finding total unexplained losses of 25,000 gallons, he suspected a meter problem and arranged for a helium test to be performed on the gas line. The test, performed the following day, revealed the catastrophic gas leak. ExxonMobil reported the leak to the Maryland Department of the Environment (“MDE”) and cleanup efforts began immediately.

MTBE and Benzene

The primary concern, and the subject of this case, is the contamination of groundwater with two volatile organic compounds found in gasoline: methyl tertiary-butyl ether (“MTBE”) and benzene. MTBE is a compound commonly added to gasoline to help it burn “cleaner,” reducing emissions of air pollutants from automobile exhaust systems. Because MTBE is highly water soluble, it easily disperses through groundwater at higher concentrations than many other contaminants. At trial, the plaintiffs' toxicology expert, Dr. Kenneth Rudo, testified that MTBE is a known mutagen ⁴ and therefore, from a toxicological standpoint, “there is no safe level.” ⁵ Some animal studies have indicated that MTBE is carcinogenic, but there have been no human studies linking MTBE to cancer.⁶ He also testified that twenty-five states have banned the use of MTBE because of groundwater contamination concerns. The EPA has classified MTBE as a potential human carcinogen at large doses, but there is not enough data to classify it as a human carcinogen at low exposure levels in drinking water. Dr. Rudo described MTBE as a “probable human carcinogen.” and he testified that the plaintiffs whose wells were contaminated with MTBE faced “an incremental risk of developing these cancers in the future.”

Due to the lack of scientific consensus, the EPA has not set a maximum contaminant level (“MCL”) for MTBE, only an aesthetic standard of 20–40 parts per billion (“ppb”).⁷ At concentrations exceeding 20–40 ppb,...