Certification of class action appropriate in suit for nuisance, trespass and negligence against grain processor

by Gary Taylor

Freeman, et al., v. Grain Processing Corp.
Iowa Supreme Court, May 12, 2017

Residents who live near Grain Processing Corporation’s (GPC) corn wet milling plant in Muscatine brought an action for nuisance, trespass and negligence against GPC for its manner of operation of the plant and the resulting “haze, odor, and smoke” emanating from the plant.  The residents moved to treat the claim as a class action suit on behalf of all residents suffering the effects of the plant’s operation.  GPC resisted the motion to certify the case as a class action, arguing that the claims of the residents were “inherently individual, and as such, individual issues predominated over those common to the class.”  The district court granted class certification.  Noting its authority to modify or decertify the class at any time, the court divided the class into two subclasses: one for members in close proximity to GPC, and the other for those in peripheral proximity.  GPC appealed.  Certification of the class action suit was the sole issue before the Iowa Supreme Court (in an earlier case, posted here, these same parties litigated the applicability of the Clean Air Act to local claims for nuisance).

Under Iowa Rules of Civil Procedure 1.261 – 1.263 a district court may certify a class action if “the class is so numerous…that joinder of all members…is impracticable” and “there is a question of law or fact common to the class.”  In addition, a class action should be permitted for the “fair and efficient adjudication of the controversy” and “the representative parties fairly and adequately will protect the interests of the class.”  The Court of Appeals first noted that caselaw requires that “a failure of proof on any one of the prerequisites is fatal to class certification,” but also that, at this stage, “the proponent’s burden is light.”  The Court of Appeals does not review the decision to certify the class itself, but simply whether the district court abused its discretion in doing so.

GPC argued that the district court erred because the requirement of commonality was not met, and that in this case individual issues predominate over common questions of law or fact.

Commonality.  It is not sufficient that class members have all suffered a violation of the same provision of law.  Rather, claims must depend on a common contention of an issue that central to the validity of each one of the claims.  GPC argued that the named plaintiffs did not suffer the same injury of other class members; particularly in the types of harm suffered and the degree of proof needed to prove causation.  The district court initially agreed, noting that two of the plaintiffs –the one closest to GPC and the one furthest – suffered significantly different “concentration totals” of particulates tested in the air.  The Court resolved this disparity, however, by creating the two subclasses and grouping the plaintiffs accordingly.  Thus the plaintiffs within each subclass had identified common questions of extensiveness of emissions, what caused them, what precautions were taken, and economic impact.

Predominance.  A common question does not end the inquiry.  Courts consider class actions appropriate “only where class members have common complaints that can be presented by designated representatives in the unified proceeding.”  It “necessitates a close look at the difficulties likely to be encountered in the management of a class action.”  The district court spent considerable time addressing the predominance question in its ruling.  It concluded “While variations in the individual damage claims are likely to occur and other sources of emissions may pose unusual difficulties, common questions of law and fact regarding defendant’s liability predominate over questions affecting only individual class members such that the subclasses should be permitted for the fair and efficient adjudication of the controversy.”  After going through the standards of proof for negligence, trespass, and nuisance claims, the Court of Appeals agreed with the district court that common questions of law, with common evidentiary findings required of each, will predominate the action, and that therefore class action treatment is appropriate.

Class action certification was affirmed by the Court of Appeals.

US Supreme Court declines to take Grain Processing Corporation nuisance case

The US Supreme Court has declined to hear Grain Processing Corporation’s appeal of the Iowa Supreme Court’s decision that neither the Federal Clean Air Act nor state emissions regulations preempt nuisance suits brought by neighbors complaining of the chemicals and particulate matter from the company’s facility in Muscatine. The original blogpost of the Iowa Supreme Court case is here.

A brief article from of all places, Fox News Montana.

Clean Air Act, state emissions regulations do not preempt private nuisance or trespass claims

by Gary Taylor

Laurie Freeman, et al v. Grain Processing Corporation
(Iowa Supreme Court, June 13, 2014)

Grain Processing Corporation (GPC) conducts corn wet milling operations at its facility in Muscatine.  Laurie Freeman and seven other named plaintiffs – representing a class identified as “all Muscatine residents who have resided…within 1.5 miles of the perimeter of [GPC’s] facility” – allege that GPC’s operations create hazardous by-products and harmful chemicals which are released directly into the atmosphere.  The pollutants include sulfur dioxide, hydrochloric acid, particulate matter, and volatile organic compounds including acetaldehyde.  They assert that particulate matter is visible on nearby properties and that the emissions cause persistent irritations and discomforts and put them at risk for serious health effects.  They brought claims for nuisance, negligence and trespass against GPC.  GPC countered by filing for summary judgment, claiming that (1) the federal Clean Air Act (CAA) preempts the plaintiffs’ state law claims, (2) Iowa Code Chapter 455B – which regulates emissions – preempts the plaintiffs’ claims, and (3) a lawsuit impacting facility emissions lacks judicially discoverable standards for resolving the issues.  The district court sided with GPC and plaintiffs appealed.  The portions of the Iowa Supreme Court decision addressing (1) and (2) will be reviewed here.

Clean Air Act preemption. In a 63-page opinion that included a history lesson on the origins of present day environmental law, the Iowa Supreme Court acknowledged that “the Environmental Protection Agency has created a vast regulatory structure to control the emission of air pollutants, including technological standards, health standards, risk levels, and enforcement provisions, completely transforming what was once the province of state law.” The court also recognized, however, that there are differences between common law remedies such as nuisance and trespass, and regulatory regimes such as the CAA and chapter 455B.  While regulatory regimes focus on the prevention of pollution through emissions standards designed to protect the general public, “the common law focuses on special harms to property owners caused by pollution at a specific location.”  The Iowa Supreme Court noted that the United States Supreme Court is reluctant to find that a federal law preempts state law in areas where states have traditionally exercised their police power.  Congress has the power to preempt local law and can expressly do so, but did not in the CAA.  To suggest that Congress indirectly removed state law claims such as nuisance and trespass “seems…rather unlikely,” and the Iowa Supreme Court declined to interpret the CAA in that way.  “The purpose of state nuisance and common law actions is to protect the use and enjoyment of specific property, not to achieve a general regulatory purpose….We decline to conclude that the increased complexity of the CAA has categorically elbowed out a role for the state nuisance and common law claims presented here.”

Iowa Code Chapter 455B. The court began by noting that “the legislature is presumed to know the existing state of the law when a new statute is enacted.  In the absence of any express repeal, the new provision is presumed to accord with the legislative policy embodied in prior statutes.”  While there are no definitive Iowa cases addressing the question of whether nuisance claims may go forward in light of Chapter 455B, the court did find instructive cases that have found that a lawful business, properly conducted, may still constitute a nuisance, even if in compliance with state regulations.  “We do not see enforcement of nuisance and other common law torts as inconsistent with the regulatory framework of chapter 455B.”  Nuisance claims are based on specific harms to the use and enjoyment of real property, while air pollution regulations are enacted to protect the public interest.

The Iowa Supreme Court reversed the district court’s summary judgment, allowing the case to proceed to trial.

Subscribe

Archives

Categories

Tags

Admin Menu