10th Circuit in Rocky Flats case: After 25 years, give plaintiffs justice

June 24, 2015

(Reuters) – More than 25 years ago, eight Coloradoans agreed to serve as the representatives for a class of about 13,000 property owners who believed the Rocky Flats nuclear weapons plant had contaminated their land with radioactive plutonium. In late 2005, after 15 years of pre-trial motions practice against the federal contractors Dow Chemical and Rockwell International, the case finally went to a four-month trial. Jurors deliberated for 17 days, answering a 30-page jury form, before returning a verdict of $177 million in compensatory damages and $200 million in punitive. With pre-trial interest, the compensatory damages alone topped $700 million.

In 2011, the 10th U.S. Circuit Court of Appeals wiped out the jury verdict, holding that the trial judge was too expansive in instructing the jury about what constitutes a nuclear incident.

On Tuesday, a different 10th Circuit panel gave back what the appeals court took away in 2011. The 38-page majority opinion by Judge Neil Gorsuch is worth reading for a couple of reasons. First, it’s a surprisingly gripping story of legal strategy. The judge, who clerked for two different U.S. Supreme Court justices and is often mentioned as a possible Republican Supreme Court nominee, shows how lawyers’ decisions can reverberate in unexpected ways. Here, a big risk by plaintiffs’ lawyers at Berger & Montague paid off, but the argument that worked so well for Dow and Rockwell in their first trip to the 10th Circuit ended up backfiring badly.

Gorsuch also steps back to address the consequence of the gamesmanship that has kept this case unresolved for so many years – through the deaths, though the judge doesn’t mention this, of four of the original class representatives. Splitting with Judge Nancy Moritz, who called for a retrial of the class claims, Judges Gorsuch and Gregory Phillips instructed the trial court to enter judgment for the plaintiffs.

“We can imagine only injustice flowing from any effort to gin up the machinery of trial for a second pass over terrain it took fifteen years for the first trial to mow through,” Judge Gorsuch wrote. “Injustice not only in the needless financial expense and the waste of judicial resources, but injustice in the human costs associated with trying to piece together faded memories and long since filed away evidence, the emotional ordeal parties and witnesses must endure in any retrial, the waste of the work already performed by a diligent and properly instructed jury, and the waiting – the waiting everyone would have to endure for a final result in a case where everyone’s already waited too long.”

That’s pretty stirring stuff, especially for lead plaintiffs’ lawyer Merrill Davidoff of Berger & Montague, who has been with the case since the beginning. (His wife was six months’ pregnant with his youngest son when the class action was filed; that son is now 25, he said.) “It’s been a real ordeal,” Davidoff said. “We’ve got a lot of people in the class who are, thank God, still alive and looking forward to a judgment.”

Judge Gorsuch’s opinion credited plaintiffs’ lawyers with performing “a little judicial jiu-jitsu” by turning the defendants’ 2011 appellate win against them. That win was based on what the judge called “a curious tactical decision” by defense lawyers at Kirkland & Ellis.

As the opinion explained, a federal statute called the Price-Anderson Act governs tort suits involving claims against nuclear facilities. The law limits defendants’ liability for “nuclear incidents” (and requires the federal government to pay damages not covered by insurance), so, Gorsuch wrote, “defendants often have as much incentive as plaintiffs to accept that any harm they caused stemmed from a nuclear incident.”

But Kirkland & Ellis told the 10th Circuit in the 2011 appeal that the jury misunderstood the definition of a nuclear incident – effectively denying such an incident occurred. That argument persuaded the first 10th Circuit panel to vacate the jury verdict and remand the case.

It also, however, left an opening for the plaintiffs – who elected to renounce any attempt to approve a nuclear incident under the Price-Anderson Act and proceed only with their state-law nuisance allegations. Plaintiffs’ lawyers furthermore told the trial judge that they didn’t need to retry the nuisance claims because the jury had already reached a nuisance verdict with instructions the 10th Circuit deemed proper. It was a gamble for the class, but, according to Davidoff, it would have been nearly impossible to try the case a second time, decades after the suit was filed and more than 50 years since some of the events at issue.

The trial judge, U.S. District Judge John Kane, sided with Dow, Rockwell and Kirkland, finding both that Price-Anderson preempted the state-law claim and that the 2011 panel’s mandate precluded recovery on it.

The 2015 10th Circuit panel, however, said the federal law does not bar a nuisance claim when a nuclear incident is alleged but unproven. Essentially, the Gorsuch opinion said, the defendants were stuck with the results of their own tactics. “In the end, Dow and Rockwell appear to have persuaded even the plaintiffs that this case does not involve a nuclear incident with the meaning of the Price Anderson Act – at least in the light of the statutory construction the defendants urged and this court adopted in the first appeal,” the opinion said. “In this light, we can well understand why the plaintiffs on remand renounced a new trial and sought entry of a judgment based on the existing nuisance verdict.”

A Dow representative told Reuters Tuesday that the company is considering an en banc petition to the entire 10th Circuit or a petition for certiorari at the Supreme Court. The company also said it is indemnified by the Department of Energy for Rocky Flats liability. Lead defense counsel Christopher Landau of Kirkland didn’t respond to a phone message.

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