Summary
rejecting defendants' effort to limit discovery to an eight-year time period in a case concerning property damage caused by leaks from a pipeline and granting motion to compel discovery as to pipeline at issue "from its construction to present"
Summary of this case from United States v. Exxonmobil Pipeline Co.Opinion
CIVIL ACTION NO: 01-0881, SECTION: "M"(1)
August 22, 2002
MINUTE ENTRY
HEARING ON MOTIONS
APPEARANCES: Submitted on briefs
MOTIONS:
TEXAS BRINE'S MOTION FOR A PROTECTIVE ORDER (Rec. doc. 83)
GRANTED IN PART AND DENIED IN PART
OCCIDENTAL'S MOTION FOR A PROTECTIVE ORDER (Rec. doc. 86)
GRANTED IN PART AND DENIED IN PART
Before the undersigned are the motions of the defendants, Texas Brine Company, LLC ("Texas Brine") and Occidental Chemical Corporation ("Occidental"), for protective orders limiting the scope of the discovery of the plaintiffs, Hawthorne Land Company, Hugh A. Hawthorne Family Class Trust, and Bank One Trust Company, N.A., Trustee (collectively referred to as "Hawthorne").
Hawthorne alleges it is the owner of land in the Parishes of St. James and Assumption, State of Louisiana, where it leased a pipeline right of way to Texas Brine and Occidental. Petition attached to Rec. doc. 1. A 42 mile long pipeline was constructed in 1966 from Grand Bayou, near Napoleonville, Louisiana, to Occidental's chemical plant in Taft, Louisiana, for the purpose transporting sodium chloride solution (the "Occidental/Taft pipeline"). Hawthorne alleges its land was contaminated as early as April 9, 1985 and as late as November 30, 1987 by at least twenty-nine leaks of the sodium chloride solution and other contaminants, including naturally occurring radioactive material chlorides. Petition attached to Rec. doc. 1 at paras. 17-45. Five of these leaks were alleged to have occurred in 1985, five more in 1986 and the remaining nineteen in 1987. Id. Hawthorne alleges that Texas Brine and Occidental failed to clean-up discharges when they knew or should have known of the toxic nature of the contaminants. Hawthorne alleges that they covered over the contamination rather than removing the discharged material with the result that the contaminants spread and migrated through Hawthorne's land. Hawthorne seeks general and punitive damages for the actions of Texas Brine and Occidental. Id.
Texas Brine and Occidental removed Hawthorne's petition to federal court. Rec. doc. 1. Hawthorne had named other defendants and contended the presence of the non-diverse defendants required that the action be remanded. Rec. doc. 6. The District Court denied the motion to remand. Rec. doc. 20. Hawthorne dismissed without prejudice three of these defendants, Woodson Construction Company ("Woodson"), Paul Lane d/b/a Paul Lane's Construction Company and Marsh Buggage Equipment Company. Rec. docs. 5, 36 and 58. The District Court granted the motion of a fourth defendant, Cain Hydrostatic Testing, Inc., for summary judgment. Rec. doc. 85. In addition to Texas Brine and Occidental, only Tassin International, Ltd. and Diamond Fabricators, Inc. remain as defendants.
Hawthorne noticed the depositions of Texas Brine and Occidental pursuant to Fed.R.Civ.P. 30(b)(6) and caused subpoenas to be issued for the production of documents at these depositions. Rec. docs. 87 and 88. Texas Brine and Occidental contend that the scope of Hawthorne's discovery is too broad. They argue that discovery should be limited to the Occidental/Taft pipeline for the period from 1982 through 1990. They also raise specific objections to many of the areas of examinations and designation of documents sought by Hawthorne.
GENERAL OBJECTIONS
Hawthorne seeks discovery on a least five pipelines in Louisiana and in New York which are or were used to transport sodium chloride solution or brine from the time of the installation of the earliest pipeline in 1965 through the present. Hawthorne contends this is relevant to its claim for punitive damages in that it will show that Texas Brine and Occidental had knowledge of a leak problem and failed to act responsibly. It also contends that the discovery of more recent leaks is relevant to show that the installation of epoxy lined pipeline is required.
Texas Brine and Occidental use a 1990 report by Puckorius Associates, Inc. in support of their argument to limit discovery. The Puckorius report is sixty-nine pages long, exclusive of photographs. Its title is "Identification of the Cause and Recommendations for the Mitigation of Brine Pipeline Corrosion." It is dated December 6, 1990 and was prepared for Texas Brine. Exhibit 3 to Rec. doc. 86. Hawthorne replies that this report ignored leaks on its property that occurred in the 1980's, before Texas Brine and Occidental decided to investigate the cause of the leaks.
The report shows that Texas Brine was the operator of three pipelines that originated at its Grand Bayou salt dome facility. Id. at p. 1. One of the pipelines was owned by Occidental known as the Occidental/Taft pipeline on the Hawthorne property. The other two pipelines were owned by Georgia Gulf and Vulcan and they did not traverse the Hawthorne property. The report shows that beginning in 1984 there were unexpected corrosion failures from internal pitting on all three pipelines that continued through the summer of 1989. Id. In late 1987 Occidental replaced 15,000 feet of its pipeline with epoxy lined pipe. Id. at p. 17. In order to combat the leaks, Texas Brine recommended using a knife pig to clean the line instead of the brush pig that had been used. Occidental resisted this recommendation because the knife pig could damage the epoxy lined pipe. The other two pipeline owners also objected that the knife pig would damage the calcium carbonate scale liner on their pipelines.
The Puckorius report concluded that a micro biologically induced corrosion was the predominant cause of the corrosion that caused the leaks. Id. at p. i. Biocides were found to be effective against the bacteria. Id. The report concluded that it was not necessary to use a knife pig. It was not able to trace the source of the bacteria, but identified severe flooding in the Grand Bayou area ten years earlier as the most likely source. Id. at p. ii. The Puckorius report made a series of recommendations, for example the continuous feed of chlorine into the fresh water systems. It suggested that for environmentally sensitive areas consideration be given to the option of installing internally coated pipe like the epoxy coated pipe already installed by Occidental in certain areas. Id. at p. 26.
The Puckorius report shows fresh water is used to dissolve salt from the salt dome walls resulting in saturated sodium chloride brine.Id. at 15-16.
The Puckorius report described the operations for the Occidental pipeline for the first nineteen years as generally stable with little or no unexpected leakage from internal corrosion. Id. at p. 17. Elsewhere the report referred to a low historical rate of leakage. Id. at p. 22. This indicates that there were at least some leaks in the Occidental pipeline prior to 1984. While the report expressed confidence in the proposed chlorination of the fresh water supply and other measures to eliminate the bacteria, the report indicated that some leakage might continue. The report cited the experience of another pipeline operator with a similar problem who found that with the use of chlorine the incidence of corrosion perforation in their pipelines returned to the historical negligible level. Id. at p. 21.
Hawthorne may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party. Fed R. Civ. P. 26(b)(1). Under Rule 26(b)(1), the Court must focus on the claims and defenses involved in the action. Fed. Rule Civ. P. 26(b) Advisory Committee's Note, 2000 amendments. Hawthorne's claim is an action for damages to its land for leaks of sodium chloride solution and other contaminants from the Occidental/Taft pipeline on its property. The determination of whether information is discoverable because it is relevant to the claims or defenses depends on the circumstances of the pending action. Id. Hawthorne contends that the information on leaks from pipelines other than the Occidental/Taft pipeline is relevant for purposes of punitive damages. It makes the same argument in support of its request for information on leaks outside of the 1982 to 1990 time limit sought by Texas Brine and Occidental.
The parties rely on Rivera v. United Gas Pipeline Co., 697 So.2d 327 (La.App. 5th Cir. 1997), writ denied, 704 So.2d 1196 (1997), in support of their respective positions. United Gas Pipeline contracted with Woodson to install a new 24-inch pipeline on its existing right of way to replace 16-inch and 18-inch pipelines that remained in use during construction. The new pipeline was to be constructed ten to twenty-five fee away from the existing pipelines. During construction there were three incidents where natural gas was released. The first occurred in October, 1991 when the 18-inch pipeline was caused to disconnect in the vicinity of work on the new line. In January, 1992 a tank used to store materials extracted from the gas pipeline exploded and, also in January, a Woodson back hoe operator severed a two-inch line connected to the new line causing a gas leak. Suits were filed in response to these incidents. The court of appeal affirmed the trial court's award of punitive damages for the third incident. The trial court found the defendants' conduct to be wanton and reckless based upon the presence of the three incidents. The court found that, but for the two prior incidents, the trial court would not have made such a determination for the third incident. The court of appeal affirmed the use of the prior incidents to show wanton and reckless disregard for public safety. 697 So.2d at 336.
Texas Brine and Occidental contend that the incidents at the other pipelines and outside of the time period are not sufficiently similar to be relevant to Hawthorne's claims. They also contend that the information sought by Hawthorne goes beyond the limitations found in Fed.R.Civ.P. 26(b)(2)(i), (ii) and (iii). "All discovery is subject to the limitations imposed by Rule 26(b)(2)(i), (ii) and (iii)." Fed.R.Civ.P. 26(b)(2). These limitations are as follows:
1. the discovery sought is unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive;
2. the party seeking the discovery has had ample opportunity by discovery in the action to obtain the information sought; or
3. the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues.
The undersigned finds that the discovery should not be limited to the period from 1982 through 1990. The Puckorius report indicated there were some leaks prior to the problem that appeared in 1984. The report also showed that the defendants could experience some leaks after implementing the procedures recommended in the report. While the leaks in the Georgia Gulf and Vulcan pipelines operated by Texas Brine were substantially similar to the leaks in the Occidental/Taft pipeline, several factors show that discovery should be limited to the Occidental/Taft pipeline. The most important of these is that only the Occidental/Taft pipeline is on Hawthorne's land. It is the longest and oldest of the three Texas Brine pipelines originating at the Grand Bayou salt dome facility, so it will present a sufficient history of any problems with leaks prior to 1984. Discovery relative to the Occidental/Taft pipeline will be allowed from its construction to present. Discovery on the Georgia Gulf and Vulcan pipelines would only present cumulative and duplicative discovery.
Hawthorne also seeks discovery regarding Occidental's pipeline in New York and any brine pipeline owned or operated by Texas Brine and Occidental in Louisiana other than the three described in the Puckorius report. Hawthorne has not presented any basis for such discovery.
SPECIFIC OBJECTIONS
Although Hawthorne served Texas Brine and Occidental with different areas of inquiry for the two depositions, there is sufficient similarity that they can be treated as one set.
Areas of Inquiry 1-6.
Hawthorne seeks discovery on: (1) all relationships, contracts in effect and communications between Texas Brine/Occidental and any of the other six defendants (areas 1-4); and (2) the responsibilities of the other six defendants with regard to preventing, locating or repairing leaks on the Occidental/Taft pipeline or participation in the clean up of leak sites on that pipeline (areas 5-6). Texas Brine and Occidental contend that this discovery is related to persons who the District Court determined were fraudulently joined and the discovery is aimed at finding a basis for re-joining them as defendants. They add they have no objection to the discovery to the extent Hawthorne seeks factual information regarding the leaks. Hawthorne contends that all the information sought on these other defendants is discoverable pursuant to Fed.R.Civ.P. 26(b)(1). The District Court denied the motion to remand and dismissed four of the other six defendants. The objections of Texas Brine and Occidental to the first four areas of inquiry will be sustained, because they are not relevant to Hawthorne's claims. The information sought in areas five and six is factual information relating to the leaks in the Occidental/Taft pipeline that must be provided.
Areas of Inquiry 7 and 8.
These areas of inquiry seek the right of way, servitude or any other agreement between Texas Brine/Occidental and Hawthorne and between Occidental and Texas Brine. The objection is that these should be limited to the Occidental/Taft pipeline. For the reasons discussed above this area of inquiry is limited to the Occidental/Taft pipeline.
Area of Inquiry 9.
This area of inquiry seeks the right of way, servitude or any other agreement with Buckeye Gulf Coast Pipeline, L.P. ("Buckeye"). Texas Brine and Occidental object that Buckeye only entered into a maintenance agreement with Occidental in April 1, 2002. Although the undersigned did not place any limit on the discovery of leaks after the implementation of the recommendations in the Puckorius report, the Buckeye maintenance contract is too recent to be relevant to Hawthorne's claims.
Area of Inquiry 10-12.
These areas of inquiry seek the following information for any brine pipeline owned or operated by the defendants in Louisiana: (1) leaks; (2) the chemical constituents of all materials transported in the pipelines; and (3) remediation and clean-up activities. For the reasons discussed above these areas of inquiry are limited to the Occidental/Taft pipeline from its construction through the present.
Area of Inquiry 13.
This area of inquiry seeks information on the production, treatment, handling, storage, and transportation of brine at the time of the spills which are the subject of this litigation. Texas Brine and Occidental contend the area of inquiry is too broad. Hawthorne responds that it needs broad general information and company policies past and present. The area of inquiry is limited to Texas Brine's Grand Bayou facility and the Occidental/Taft pipeline from its construction to the present. Hawthorne's willingness to accept "broad general information" resolves the concern that the scope of the area of inquiry is too broad.
Area of Inquiry 14.
This area of inquiry seeks the identity of all corporations "for whom" the defendants own, operate, manage, or control in Louisiana. Texas Brine and Occidental object and urge that it appears that a word or words were omitted by Hawthorne. They offer to respond if Hawthorne rewords the inquiry. Hawthorne responded with what it intended when it drafted the inquiry. Texas Brine and Occidental shall respond to the area of inquiry as revised.
Area of Inquiry 15.
Hawthorne accepts the objection to this area of inquiry, but requests that it not be limited to the period 1982-1990. For the reasons discussed above, it is limited to the Occidental/Taft pipeline from its construction through the present.
Area of Inquiry 16.
The area of inquiry seeks information on the metering of brine or other substances transported in the Occidental/Taft pipeline from January 1, 1985 until the present time. Texas Brine and Occidental object to providing information after 1990. This objection is overruled.
Area of Inquiry 17-19 and 22-24.
These areas of inquiry seeks information on the following: (1) any regulatory enforcement actions in Louisiana involving any brine pipeline owned or operated by Texas Brine and Occidental; (2) the alleged radioactivity of any brine transported from Napoleonville by them; (3) their communications concerning brine pipeline leaks in Louisiana; (4) reports of leaks for all brine pipelines owned or operated by them in Louisiana; (5) all correspondence between them on brine leaks in Louisiana; and (6) meetings among their representatives on brine leaks and their clean-up in Louisiana. For the reasons discussed above, these areas of inquiry are limited to the Occidental/Taft pipeline for the period from its construction though the present.
Area of Inquiry 21.
This area of inquiry seeks information on all contracts between Texas Brine and Occidental relating to the operation, ownership, liability or indemnity of the Occidental/Taft pipeline. Texas Brine and Occidental object to providing testimony on any subject beyond the Salt Operating Agreement between Texas Brine and Occidental. Hawthorne does not respond except to say it should not be limited to the time from 1982 through 1990, but this is not responsive to the objection. The objection is sustained.
Areas of Inquiry 25 and 26.
Texas Brine and Occidental raise privilege issues, but they have not submitted a privilege log. Their objections to these two areas of inquiry are denied without prejudice to re-urge them after preparation of a privilege log in accord with the following requirements. These requirements shall apply to any other discovery sought by either party where the responding party contends that documents are protected from disclosure for any reason.
1. Each page of the documents withheld from production shall be separately numbered. A privilege log will be prepared and submitted to the party seeking discovery of the documents. The privilege log shall include a detailed description of the contents of EACH DOCUMENT, including the page numbers, date, description, originator, recipients and the nature of the privilege asserted. Attachments are considered separate documents.
2. The party seeking the documents and the party objecting to producing the document shall meet and confer in person or by telephone concerning EACH DOCUMENT.
3. If the parties are unable to resolve the issue after meeting, the party seeking to withhold the document(s) from production shall a file a motion to sustain the privilege that shall include the following:
a. A certificate showing that the parties have met and conferred in accord with number 2 above;
b. A revised privilege log that shall include a detailed description of the contents of EACH DOCUMENT that remains in contention after the conference described above.
4. The party seeking to withhold documents from production shall submit to the undersigned those documents for in camera inspection.
5. The party seeking the documents shall provide a memorandum in support of its position that separately addresses EACH DOCUMENT.
Texas Brine and Occidental show that the designations of documents sought in the subpoenas duces tecum track the areas of examination in the deposition notices. Accordingly, the ruling on the scope of the areas of examination also applies to the designation of documents sought in the subpoenas. Texas Brine and Occidental shall produce the documents responsive to the subpoenas or a privilege log within ten (10) working days of the entry of this order.
IT IS ORDERED that the motions of Texas Brine and Occidental for a protective order (Rec. docs. 83 and 86) are GRANTED in PART and DENIED in PART as provided herein.