Seventh Circuit rejects certification of Roxana pollution claims; Posner clarifies 'predominance' in Simmons case

The Seventh Circuit Court of Appeals has overturned District Judge Patrick Murphy's certification of a class of Roxana residents who claim they may be in danger of developing health problems and diminished property value due to oil refinery operations spanning 90 years.

Justice Richard Posner held that Murphy - who retired in December - failed to perform a rigorous analysis to determine whether issues common to the class predominate over issues that differ among the individual class members.

"Mere assertion by class counsel that common issues predominate is not enough," Posner wrote. "That would be too facile. Certification would be virtually automatic."

Shell Oil Co. and ConocoPhillips appealed Murphy's certification order on predominance and numerosity questions in a case that originated in Madison County Circuit Court in 2012 and was later removed to federal court in East St. Louis.

Derek Y. Brandt, G. Michael Stewart and Jo Anna Pollock of the Simmons firm in Alton filed the case on behalf of residents Jeana Parko, Delbert R. Cobine, Janice A. Cobine and Rodger Jennings.

Co-counsel include lawyers from Hanly, Conroy, Bierstein, Sheridan, Fisher and Hayes in New York and the Melissa K. Sims Law Office in Peru. Other defendants in the action include Equilon Enterprises, WRB Refining, ConocoPhillips WRB Partners and Cenovus GPCO.

Posner wrote that Murphy did not explore issues such as contamination levels from different polluters in a heavily industrialized part of the county and dimunition of property values.

According to the opinion filed Jan. 17, Murphy identified a question common to the class as to whether the defendants' "failure to contain petroleum byproduct at the refinery resulted in contamination to Roxana property."

Posner wrote that the plaintiffs' expert, a hydrogeologist, "intends to" measure benzene contamination in ground water below properties, even though their water supply comes from the village's uncontaminated aquifer, not ground water.

"And there is no suggestion that the village supplies them from the aquifer because the groundwater is polluted," he wrote.

Posner noted the "drubbing" of real estate values following the collapse of the housing bubble and financial crisis. He wrote that it cannot be assumed that a decline in property values, "if in fact there has been one," is due to proximity to refineries "that for all one knows has been leaking contaminants for the last 95 years without causing detectable harm."

"There are many things commonly found in soil beneath rural or suburban houses that homeowners would very much like not to enter their home (such as earthworms, fungi, ants, beetles, slugs, radon, chemical residues, thousands of different types of microbe -- and groundwater), but as long as there is no danger of such unwanted visitors their underground presence should not affect property values," he wrote.

"Benzene in the water supply is one thing; benzene in groundwater that does not feed into the water supply is quite another."

He wrote that it cannot be assumed that every class member has experienced the same dimunition in property value even if everyone has experienced the same level of contamination.  The greater the variance in property values, he wrote, the less likely it would be that contamination would "affect the value of all or most properties by the same amount of money or the same percentage of market value."

Posner chided Murphy for not exploring "any of these issues."

"He thought it enough at this stage that the plaintiffs intend to rely on common evidence and a single methodology to prove both injury and damages, and that whether the evidence and methodology are sound and convincing is a question going to the strength of the plaintiffs' case and should be postponed to summary judgment proceedings or trial.

"But if intentions (hopes, in other words) were enough, predominance, as a check on casting lawsuits in the class action mold, would be out the window. Nothing is simpler than to make an unsubstantiated allegation."

In the opinion, Posner also rejected the defendants' argument that the class was not large enough to satisfy the numerosity requirement for class certification.

"How many (if any) of the class members have a valid claim is the issue to be determined after the class is certified," he wrote.

The lawsuit

Residents claim they have been exposed to various contaminants, including benzene, which may cause them to develop cancer and other health issues.

They claim that oil refineries, which have been in existence since 1917 and have been refining oil since 1918, began accidentally releasing massive amounts of benzene, hydrogen sulfide, methyl mercaptan and sulfur dioxide beginning in the 1980s through leaks. Those contaminants, they say, were either released into the ground or the air during the numerous spills.

“Defendants’ releases and spills of petroleum products from leaking pipes and storage tanks, transfer of product, equipment failures, and fires have contaminated and continue to contaminate the ground of the Village,” the suit states. “Defendants’ releases of volatile organic compounds, petroleum hydrocarbons, hydrogen sulfide, methyl marcaptan, sulfur dioxide, and aluminum silicate catalyst have contaminated and continue to contaminate the air.”

In addition to the soil and air contaminants, the engineering firm URS Corporation discovered the existence of two groundwater plumes, the lawsuit claims. Groundwater plumes are volumes of contaminated groundwater that extend from a specific source. The two plumes are contaminated with benzene, which leaked from a pipeline spill in the area south/southwest of Roxana, and petroleum products from a refinery to the east, the suit states. The plumes exist in the southern portion of Roxana, the plaintiffs claim.

Groundwater pumping performed at the refinery site has also spread contaminants throughout the town, the plaintiffs claim.

“Ordinarily, any benzene in the groundwater would follow the groundwater gradient to the west,” the suit states. “The groundwater pumping, however, pulls groundwater toward the Refinery pumping centers, back to the northeast and under the southern portion of the Village’s residential area.”

Benzene and other toxic chemicals have also made their way to certain surface waters via a running water drainage ditch that flows south along Old Edwardsville Road and Illinios Route 111. The ditch passes within several hundred feet of the Roxanna Water Treatment Facility, which provides all of the drinking water for the town, the village claims.

Excessive storm water discharge near the facility also diverts to Grassy Lake, which sits across from the drainage ditch. Smith Lake and Conoco Lake may also be contaminated. The lakes, which house various wildlife, are also used for recreation and fishing, according to the complaint.

The contaminants in the water and soil can cause various diseases. For instance, benzene is known to cause cancer; ethylbenzene, which is found in oil, may cause eye and throat irritation, vertigo and dizziness; toluene may result in headaches, dizziness, tiredness, memory loss, nausea and loss of appetite; and n-hexane, a chemical made from crude oil, can cause nerve disorders, the village claims.

Not only are they concerned about their health, but the plaintiffs claim they also fear for the value of their properties.

“The contamination has reduced or destroyed the value of these properties,” the suit states. “The contamination of these properties has caused great economic loss to Plaintiffs and the other owners of these properties.”

The plaintiffs allege negligence, trespass, public nuisance, private nuisance and unjust enrichment against the defendants.