Watson v. BNSF Ry. Co.

• Decision Date: 14 November 2017
• Docket Number: DA 17-0229
• Citation: Watson v. BNSF Ry. Co., 2017 MT 279, 389 Mont. 292, 405 P.3d 634 (Mont. 2017)
• Parties: Kelly G. WATSON, Plaintiff and Appellant, v. BNSF RAILWAY COMPANY, a Delaware Corporation; Burlington Northern and Santa Fe Railway Company; Burlington Northern Railroad Company, and Does A-Z, Defendants and Appellees.
• Court: Montana Supreme Court

389 Mont. 292

405 P.3d 634

2017 MT 279

Kelly G. WATSON, Plaintiff and Appellant,

v.BNSF RAILWAY COMPANY, a Delaware Corporation; Burlington Northern and Santa Fe Railway Company; Burlington Northern Railroad Company, and Does A-Z, Defendants and Appellees.

DA 17-0229

Supreme Court of Montana.

Submitted on Briefs: October 18, 2017

Decided: November 14, 2017

For Appellant: Allan M. McGarvey, John F. Lacey, McGarvey, Heberling, Sullivan, & Lacey, PC, Kalispell, Montana

For Appellees: Chad M. Knight, Knight Nicastro, LLC, Boulder, Colorado

Justice James Jeremiah Sheadelivered the Opinion of the Court.

¶ 1PlaintiffKelly G. Watson("Watson") appeals the January 25, 2017 Order by the Eighth Judicial District Court, Cascade County, granting Defendant Burlington Northern and Sante Fe Railway Company's ("BNSF")motion for summary judgment on Watson's asbestos-related disease claim, brought under the Federal Employers' Liability Act ("FELA").The dispositive issue in this matter is as follows:

Whether the Bankruptcy Court's Order enjoining claims against W.R. Grace and other "Affiliated Entities," including BNSF, tolled the statute of limitations on Watson's claim.

¶ 2We reverse and remand for further proceedings consistent with this Opinion.

PROCEDURAL AND FACTUAL BACKGROUND

¶ 3 Watson was a long-term employee of BNSF in Lincoln County.During his BNSF employment, he was exposed to vermiculite dust.The vermiculite mined in Libby and the dust produced by it contains amphibole asbestos.BNSF transported vermiculite for W.R. Grace & Company and its predecessors from Libby to various locations.

¶ 4 In July 2000, following widespread news reports on the hazards posed by vermiculite dust from the W.R. Grace mine in Libby, Watson sought a health screening offered by the Libby Community Environmental Health Program.Watson's initial test results for lung disease were negative.

¶ 5 On April 2, 2001, W.R. Grace filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in U.S. Bankruptcy Court for the District of Delaware.The Bankruptcy Court immediately entered a temporary restraining order ("TRO") against actions being pursued against Nondebtor Affiliates and certain third parties arising from W.R. Grace's mining operations and exposure to vermiculite dust.The TRO defined "Actions" as "pending actions and actions that have not been filed or are not pending as of the date of entry of this Order...."It also ordered "that the prosecution and/or commencement of all Actions are temporarily restrained pending a resolution of [W.R. Grace]'s pending motions for a preliminary injunction...."On April 12, 2001, the Bankruptcy Court extended the TRO, again defining "Actions" as "pending actions and actions that have not been filed or are not pending as of the date of entry of this Order[,]" and ordered that the "Order Granting Temporary Restraining Order entered on April 2, 2001 temporarily restraining the prosecution and/or commencement of all Actions pending a resolution of plaintiff's pending motions for a preliminary injunction is hereby extended through and including April 24, 2001...."On April 18, 2001, the Bankruptcy Court entered a preliminary injunction pending a May 3, 2001 hearing.

¶ 6 On May 3, 2001, the Bankruptcy Court entered a Preliminary Injunction, which ordered "that the prosecution of all Actions are stayed and enjoined pending a final judgment in this adversary proceeding or further order of this Court...."The Injunction again defined "Actions" as "any case filed or pending," but omitted the previously used language, "and actions that have not been filed or are not pending."

¶ 7 On January 22, 2002, the Bankruptcy Court modified the May 3, 2001 Order.The January 22, 2002 Order "reinstate[d] the bar against the commencement of new Actions against Affiliated Entities."The January 22, 2002 Order also restored the language that had been omitted from the May 3, 2001 Order, so that the definition of "Actions" again included "actions that have not been filed or are not pending...."The Order stayed and enjoined the prosecution of "all Actions as defined above."

¶ 8 On March 26, 2007, W.R. Grace moved to expand the Bankruptcy Court's Injunction to include actions against BNSF related to W.R. Grace's Libby mining operations.On June 6, 2007, the Bankruptcy Court entered a temporary order staying cases against BNSF while it considered expanding the Injunction.

¶ 9 Meanwhile, Watson underwent a second health screening in October 2007.On October 22, 2007, a physician advised Watson he had asbestos-related disease associated with his exposure while working for BNSF.

¶ 10 On April 11, 2008, the Bankruptcy Court entered an order expanding the Injunction to include BNSF as a Nondebtor Affiliate.The Order reads, in pertinent part:

The matter before the Court is the Debtors' Motion to Expand the Preliminary Injunction to Include Actions Against [BNSF](the "Expansion Motion"), which seeks to expand the relief granted by the preliminary injunction (the "Injunction") to specifically include actions against [BNSF] for exposure of some kind to the Debtors' former vermiculite mining operations in Libby, Montana (the "Montana Actions").

...

The preliminary injunction at issue in this proceeding was issued on May 3, 2001, barring the prosecution of currently pending actions against various affiliated entities and third parties whose purported liability was solely derivative of W.R. Grace.After May 3, 2001, the preliminary injunction was extended.On January 22, 2002, the court entered an order modifying the preliminary injunction to include certain additional affiliates and to reinstate the bar against the commencement of new actions against affiliates arising from alleged exposure to asbestos whether indirectly or directly cause [d] by W.R. Grace.

...

AND NOW, this 11th day of April, 2008, for the reasons expressed in the foregoing Memorandum Opinion, it is ORDERED, ADJUDGED, and DECREED that the objections are overruled and the Debtors' Motion to Expand the Preliminary Injunction to Include Actions Against [BNSF], which seeks to expand the relief granted by the preliminary injunction to specifically include actions against BNSF for exposure of some kind to the Debtors' former vermiculite mining operations in Libby, Montana (the "Montana Actions"), is GRANTED.

It is further ORDERED, ADJUDGED, and DECREED that the Injunction, as defined in the foregoing Memorandum Opinion, is hereby expanded to include BNSF as a Nondebtor Affiliate and that the Montana Actions and all other similar actions that have been or may be brought against BNSF that arise from alleged exposure to vermiculite ore from the Debtors' Libby mining operations are and shall be stayed until further order of the Court.

(Emphasis added.)

¶ 11 On August 5, 2010, Watson and two other plaintiffs filed suit against the State of Montana, three wood products companies, Montana Light and Power Co., and Robinson Insulation Co., as well as fictitious defendants, Does A-Z.Watson's complaint contains no allegations against BNSF; neither Watson's employment nor BNSF is referenced in the pleading.

¶ 12 On February 3, 2014, under the Bankruptcy Court's Order, W.R. Grace's reorganization plan became effective and the automatic stays and injunctions, including actions against BNSF, terminated.

¶ 13 On November 28, 2014, Watson moved to amend his complaint to remove settled claims against the State, dismiss claims against the wood products defendants and Montana Light and Power Co., and add claims against BNSF.On December 2, 2014, Watson filed his First Amended Complaint and Demand for Jury Trial.He alleged that he was exposed to vermiculite dust during his employment with BNSF, which transported vermiculite for the W. R. Grace & Company and its predecessors from Libby to various locations.

¶ 14 On January 25, 2017, the District Court granted BNSF's motion for summary judgment.The District Court held the statute of limitations barred Watson's claim because Watson's claim accrued on October 22, 2007, and he should have filed his FELA claims by October 22, 2010.The District Court concluded that "[w]hile the bankruptcy court's injunction stayed pending cases against BNSF, nothing in the injunction prohibited a plaintiff from suing," and "[t]here is nothing in the original bankruptcy court injunction, BNSF expanded injunction, or associated briefing referenced by the parties that precludes filing new cases to preserve the statute of limitations."The District Court also concluded that "there is nothing in the plain language of the bankruptcy court's original injunction or expanded BNSF injunction that enjoins the ‘commencement of an action’ to trigger § 27-2-406, MCA."¹

STANDARDS OF REVIEW

¶ 15We review de novo a district court's grant or denial of summary judgment, applying the same criteria of M. R. Civ. P. 56 as a district court.Anderson v. BNSF Railway, 2015 MT 240, ¶ 15, 380 Mont. 319, 354 P.3d 1248.Summary judgment is appropriate when the moving party demonstrates both the absence of any genuine issues of material fact and entitlement to judgment as a matter of law.Anderson, ¶ 15.Once the moving party has met its burden, the non-moving party must present substantial evidence essential to one or more elements of the case to raise a genuine issue of...