IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 10-30516

TESS WILTZ, doing business as Opelousas Crawfish House, Plaintiff - Appellant BEAUCOUP CRAWFISH OF EUNICE, INCORPORATED, Intervenor Plaintiff - Appellant

v. BAYER CROPSCIENCE, LIMITED PARTNERSHIP; ALLIANZ GLOBAL RISKS U S INSURANCE COMPANY, Defendants - Appellees

Appeal from the United States District Court for the Western District of Louisiana

Before WIENER, BENAVIDES, and STEWART, Circuit Judges. FORTUNATO P. BENAVIDES, Circuit Judge: The Louisiana crawfish industry suffered a precipitous decline when rice

s e e d coated with a pesticide allegedly decimated the 1999-2000 farm-rais e d crawfish crop. The plaintiffs in this putat iv e c l a ss action are buyers and
processors of farm-raised crawfish who seek to recover their economic loss from the pesticide manufacturer under the Louisiana Products Liability Act (LPLA), LA

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. § 9:2800.54. The district court granted summary judgment to the manufacturer because the plaintiffs’ economic loss was unaccompanied by damage to their own person or property. For the following reasons, we affirm. U n i te d S ta te s C o u rt o f A p p ea l s

F i ft h C i rc u i t 

### F I L E D June 28 , 20 11 Lyle W . Cayce Clerk Case: 10-30516 Document: 00511522606 Page: 1 Date Filed: 06/28/2011No. 10-30516 I. BACKGROUND A. Crawfish farming and processing Louisiana crawfish are farmed in rice ponds. The Louisiana farm-raised crawfish cro p all e ge dly suffered a precipitous decline beginning in the 1999-2000 crawfish season. According to plaintiffs-appellants Tess Wiltz d/b/a Opelousas Crawfish House (Wiltz) and Beaucoup Crawfish of Eunic e , Inc. (Beaucoup Cr a w f i s h) , the decline was caused by the application of rice seed coated with ICON, a pesticide manufactured and sold by defendant-appellee Bayer CropScience, L.P. (Bayer). ICON rice allegedly was introduced in Louisiana rice ponds during the 1999 p lanting season and taken off the market a few years later. 1The plaintiffs buy crawfish from crawfish farmers and then either resell the crawfish live or process them for tail m e a t

. A s crawfish buyers and
processors, the plaintiffs assert they play “an essential and necessary role in the creation, preservation and perpetuation” of the Louisiana crawfis h industry. The plaintiffs have submitted evidence indicating that they create a market for small “peeler” crawfish, sell bait to crawfish farmers, provide loans to crawfish farmers, and pr o vi de logistical support to crawfish farmers by storing and transporting crawfish. According to the plaintiffs, “the farmers and the Buyer/Processors are really one unified group and not two separate groups,” and harm to the latter is “inevitable if a defective product were to sterilize or kill the

Bayer has filed a motion to strike certain parts of the plai ntiffs’ brief. We deny 1 the motion. The plai ntiffs’ discus sion of the crawfish indu st ry is supp orted by the recor d, including an expert report. Simi la rly, the plai ntiffs’ discus sion of the Philli ps li tig ati on, address ed below , i s sup portedbythe recordand publi shed c ase la w. 2 Case: 10-30516 Document: 00511522606 Page: 2 Date Filed: 06/28/2011No. 10-30516

c rawfish crops.” The plaintiffs allege they suffered economic loss when I C O N rice drastically reduced the number of crawfish they could buy and process. Although the plaint i f f s have submitted evidence suggesting they work closely with crawfish farmers, the pl a i n t i f f s have not submitted any evidence suggesting ICON actually harmed their crawfish. Nor is ther e a n y evidence 2 that the plaintiffs were deprived of an actual, legal right to buy crawfish from the crawfish farmers. 3

The plai ntiffs al lege they own certain crawfish pond s, but there is no evidence 2 those pond s were affectedbyICON

.

The plai ntiffs do not argue on appeal that they had l e g a l l y e n forceabl e 3 contractsto buy crawfish from the crawfish farmers. Indeed, they acknowledge t hat “they have no b reach of contract clai ms aga inst the F armers.” At times the plai ntiffs have been somewhat more equiv ocal. Beaucoup Crawfish produced an affidavi t asserting that “bo t h t he buyer/proces sor and the farmer/fisher men make a commitment for the entire crawfish harvest season to either buy al l that they produce, or commit to a certain mini mum or maxi mum number of sacks per day, [and] that these customary practices are widely known in the industry.” Simi la rly, the plai ntiffs’ expert concludes that crawfish proc essor s operate in a “supp ly chain structure” that “[i]n some cases . . . wil l impose producti o n controls or input requirements on the supp li er.” Acc ordi ng to the expert, this supp ly chain may “constitute a ‘contract’ as ec onomists u nder stand the ter m” f or “purp oses of economic anal ysis.” Nei ther Beaucoup Crawfish nor its expert, however, purports to connect these generic statements about the crawfish indu stry to any actualc ontract relevant to this case. For her part, Wil tz acknowledged at her depos iti on that she did not have any a greement to b uy al l of a farmer’s crawfish, nor was any farmer obli gated to sell her allof its crawfish. Even interpreted in the plai ntiffs’ favor, this evidence does not raise a justifiabl e infe renc e that Wil tz and Beaucoup Crawfish had an actual , enforc eabl e right to buy crawfish from any particular crawfish farmer. In a n y e v e n t, as discus sed bel ow, we think the Louisi ana Supr eme Court would deny the plai ntiffs’ clai ms even if they had an enforceable ri ght to b uy crawfish. 3 Case: 10-30516 Document: 00511522606 Page: 3 Date Filed: 06/28/2011No. 10-30516

B. Crawfish litigation Litigation concerning the decline in the Louisiana crawfish industry has b e e n proceeding in the Louisiana state courts for some time. Because some o f this state litigation is relevant to o u r c a s e , we provide a brief summary before turning to the case at hand. In December 1999, a class of crawfish farmers sued Ba y e r a n d others in Louisiana state court. The farmers’ class action settled in 2004. In 2000, a group of c r a w f i s h buyers and processors, including Beaucoup Crawfish, sued Bayer and others under the LPLA in Louisiana state court (the Phillips litigation). The claims asserted in the Phillips litigation are essentially 4 identical to the claims asserted i n this case. After trial in July 2007, a jury found Bayer liable to three test plaintiffs. Bayer appealed, asse rt i ng that its duty not to harm the farmers’ crawfish did not extend to cr a w f i s h b u y ers and
pro c e s sors. A five-judge panel of a Louisiana court of appeal reversed the judgments. The five-judge panel reasoned that the plaintiffs “failed to prove a proprietary interest in the crawfish crop destroyed by the use of ICON.” Phillips

v. G & H Seed Co. , 10 So. 3d 339, 344 (La. Ct. App.), writ denied , 21 So. 3d 284 (La. 2009), reh’g not considered , 24 So. 3d 871 (La. 2010). Back at the trial court, Bayer moved for summary judgment a g a i n s t all remaining plaintiffs. Relying on the five-judge panel’s decision, the trial court granted the motions on th e gr ound that the plaintiffs failed to show a proprietary interest in the farmers’ crawfish. This time the plaintiffs appealed, asserting that the trial c o u r t erred in applying a bright-line “proprietary

The Philli

ps li tig ati on bega n as a putativ e class action but evolv ed into a la rge 4 joi nderaction.
4 Case: 10-30516 Document: 00511522606 Page: 4 Date Filed: 06/28/2011No. 10-30516

interest” requirement. According to the plaintiffs, the trial court instead should have used a multi-factor “duty-risk” analysis to determine the scope of Bayer’s duty of care. A three-judge panel of the Louisiana court of appeal reversed the trial court’s grant of summary judgment. Phillips v. G & H Seed Co. , __So. 3d__, 2011 WL 1773269 (La. Ct. App. May 11, 2011). The three-judge panel “cho[s]e 5 not to apply the law of the case doctrine” and “decline[d] to follow” the decision of the five-jud g e p a nel. Id. at *4-5. The three-judge panel reasoned that the five-judge panel’s decision “was contrary to the law” because it imposed “a bright-line litmus test mandating proprietary interest in damaged property as

a prerequisite to recovery.” Id. at *5, 7. The three-judge panel thus remanded the case to the trial court with instructions to apply “a multi-factor, policydriven, duty-risk analysis” to determine “the scope and extent” of Bayer’s duties under the LPLA. Id. at *5. The three-judge panel did not, however, “determine or even speculate on the result of the required duty-risk analysis.” Id. at *8. Meanwhile, in December 2008, Wiltz filed this putative c l ass action in Louisiana state court after she was denied leave to interve n e i n the Phillips litigation. Phillips v. G & H Seed Co. , 32 So. 3d 1134, 1138 (La. Ct. App.), writ denied , 38 So. 3d 325 (La. 2010). As mentioned, t h e LPLA claims asserted in this case are essentially the same as the claims asserted in the Phillips litigation. Bayer removed this case to federal cour t p u r suant to 28 U.S.C. §§ 1332 and 1453. After removal, plaintiff Beaucoup Crawfish intervened as a second putative class representative. Bayer then filed a motion to abstain pending resolution of the Phillip s l i t i g a tion as well as motions for summary

Bayer’s a pplication for rehearing en banc or forpanel rehearingis currently 5 pending before the Louisi ana court of appeal. 5 Case: 10-30516 Document: 00511522606 Page: 5 Date Filed: 06/28/2011No. 10-30516

judgment against both Wiltz and Beaucoup Crawfish. The district court denied Bayer’s motion to abstain but granted both motions for summary judgment because the plaintiffs’ economic loss was unaccompanied by damage to their own person or property. The plaintiffs a p pealed. For the following reasons, we 6 affirm. II. STANDARDS We review summary judgment de novo, using the same standards as the district co u r t

. Holt v. State Farm Fire & Cas. Co. , 627 F.3d 188, 191 (5th Cir. 2010). Summary judgment is proper when “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” F E D

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. P. 56(a). We view the evidence and all justifiable inferences in the light most favorable of t h e nonmoving party. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 255 (1986). In a diversity case such as this one, we apply state substantive law. Erie R.R. Co. v. Tompkins , 304 U.S. 64, 78 (1938). There is no dispute that Louisiana law applies to this case. When faced with unsettled questions of Louisiana law,

we a dh ere to Louisiana’s Civilian decision-making process by first examining primary sources of law, namely, Louisiana’s Constitution, codes, and stat utes. M o o re v. State Farm Fire & Cas. Co. , 556 F.3d 270 (5th Cir. 2009). This is

The plai ntiffs recently filed a motion to stay this appeal pending resolution of 6 the Philli

ps li tig ati on. We note that the plai ntiffs filed their motion the same day the three-judge panelissued its decision in the Philli psli tig ati on. We al so note that the plai ntiffs previously objected to a simil ar motion to s tay filed by Bayer in the district court. It would thus appear that the plai ntiffs’ motion to stay is simply an attempt to pres erve a victory in what t hey now perceive to b e the more favorab le forum. In any event, the plai ntiffs have not establ ished any other basi s to stay t h i s a ppeal. Acc ordingly, the pla inti ffs ’ motion to stay i s denied. 6 Case: 10-30516 Document: 00511522606 Page: 6 Date Filed: 06/28/2011No. 10-30516

because the primary basis of Louisiana’s Civil Law is legislation and not the prior decisions of its courts. In Re: Katrina Canal Breaches Litig. , 495 F.3d 191, 206 (5th Cir. 2007). In the absence of a definitive resolution in the State’s primary s o u r c e s , however, we look next to the final decisions of the Louisiana Supreme Court. Moore , 556 F.3d at 269. Only in the absence of such a final d e c ision must we make an “Erie guess” as to how that court would resolv e th e iss u e i f p r e s ented with the same case. Id. Although we do not disregard the decisions of L o u i siana's intermediate courts unless we are convinced the Louisiana Supreme Court would decide otherwise, we are not strictly bound by them. In Re: Katrina , 495 F.3d at 206. III. DISCUSSION A. The economic-loss rule In most jurisdictions, the “economic-loss rule” bars recovery in tort when

a party suffers economi c l o s s u n accompanied by harm to his own person or property. See, e.g. , Saratoga Fishing Co. v. J.M. Martinac & Co. , 520 U.S. 875, 879 (1997) (noting t o r t l a w in area of commercial cases involving defective products “ordinarily (but with excep t i o ns) does not permit recovery for purely economic losses, say, lost profits”); Louisiana ex rel. Guste v. M/V TESTBANK , 752 F.2d 1019, 1027 (5th Cir. 1985) (en banc) (“Courts applying the tort law of Texas, Georgia, Florida, Alabama, Mississippi and Louisiana have consistently denied recovery for economic losses negligently inflicted where there was no physical damage to a proprietary interest.”); Great Sw. Fire Ins. Co. v. CNA Ins. Cos. , 557 So. 2d 966, 970 (L a. 1990) (recognizing the “general inhibition in negligence law against compensation for purely economic loss not the result of either bodily harm to the claimant or physical inj u ry to property in which

7 Case: 10-30516 Document: 00511522606 Page: 7 Date Filed: 06/28/2011No. 10-30516

claimant has a proprietary intere st”); R E S TAT E M E N T (T H I R D ) O F T O R T S : P R O D S

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. § 21 cmt. d (1998) (“A second category of economic loss excluded from the coverage of this Restatement includes losses suffered by a plaintiff but not as a direct result of harm to the plaintiff’s person or property.”). The economic-loss rule has been characterized as a pr a g m a t i c limitation on both proximate causation and the scope of a defendant’s duty of care. Compare TESTBANK , 752 F.2d at 1023 (noting the economic loss rule is “a pragmatic limitation imposed by t h e C o urt upon the tort doctrine of foreseeability) , with Rardin v. T & D Mach. Handling, Inc. , 890 F.2d 24, 26 (7th Cir. 1989) (“The i s s u e i s not

c a u s a tion; it is duty.”), with Roberts v. Benoit , 605 So. 2d 1032 (La. 1991), on reh’g , 605 So. 2d at 1052 (“Regardless if stated in terms of proximate cause, legal
cause, or duty, the s c o p e o f the duty inquiry is ultimately a question of policy . . . .”). The economic-loss rule h a s a distinguished lineage traceable at least to Justice Holmes’s opinion in Robins Dry Dock & Repair Co. v. Flint , 275 U.S. 303, 308 (1927). In Robins , the employees of a dry dock negligently damaged a vessel subject to a charter agreement. Id. at 309. The charterer lost use of the vessel for a period of time and sued the dry dock in tort for economic damages. Id. The Supreme Court rejected the charterer’s cl ai m . Th e S up r e m e C ourt reasoned that t h e d amage to the vessel “was no wrong to the [charterer] but only to those t o whom [the vessel] belonged.” Id. The Supreme Court concluded that the harm to the charterer “arose only through their contract with the owners,” and that,

as a general rule, “a tort to the person or property of one man does not make the t o r t

- f e asor liable to another merely because the injured person was under a contract with that other unknown t o the doer of the wrong.” Id. We recently

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noted that Robins may b e r e a d as both denying recovery for economic loss

re s u lting from physical damage to the property of another, and also denying
recovery for negligent interference with contract u a l r i ghts. See Catalyst Old River Hydroelectric Ltd. P’ship v. Ingram Barge Co. , 639 F.3d 207, 210 (5th Cir. 2011). Although Robins strictly interpreted federal maritime law, its reasoning has influenced state tort law a s w ell. See, e.g. , PPG Indus., Inc. v. Bean Dredging , 447 So. 2d 1058, 1060 (La. 1984) (discussing Robins in context of Louisiana state tort law). Courts an d c o m mentators have identified several justifications for the economic-loss rule. These justifications tend to echo four themes. First, without

some pragma t ic limitation on the tort doctrine of foreseeability, a defendant could be held liable for “wave upon wave of successive economic consequences.” TESTBANK

, 752 F.2d at 1028; see also E. River S. S

. Corp. v. Transamerica Delaval, Inc. , 476 U.S. 858, 874 (1986) (noting “foreseeability is an inadequate brake” on products-liability law). As the Louisiana Supreme Co u r t h as 7 recognized, “[b]ecause the list of possible victims and the extent of economic dama g e s m i ght be expanded indefinitely, the court necessarily makes a policy decision on the limitation of recovery of damages.” PPG , 447 So. 2d at 1061-62. It is generally agreed that a line must be drawn somewhere, and the economicloss rule has the virtue of being predi c t ab l e and generally applicable. TESTBANK

, 752 F. 2 d a t 1028. Second, although the economic-loss rule may produce seemingly unfair outcomes in certain cases, a case-by-case approach is

See also Robins , 275 U.S. at 309 (“The la w does not spread its protection so 7 far.” ); R ar d in , 890 F.2 d at 28 (noting the economic-loss rule was designed to li mit “for- want-of-a-nail -the-kingdom-was-lost l iabi li ty”). 9 Case: 10-30516 Document: 00511522606 Page: 9 Date Filed: 06/28/2011No. 10-30516

“no less arbitrary.” Id. This is because a case-by-case approach does not resolve 8 the line-drawing problem but merely postpones it: ultimately, some plaintiffs

w i l l b e a l l o wed to recover and others will be found too remote. Id

. A case-bycase approach has the additional drawback of producing unpredictable results that are “less judicial and m o r e the product of a managerial, legislative or negotiated function.” Id

. Third, the economic-loss rule helps preserv e the d i s t i n ct functions of tort and contract law by allowing parties to alloc a t e

econom i c r i s k s b y contract. E. River , 476 U.S. at 870-71. For example, when 9

a defective p r o d u c t malfunctions and causes a purchaser to lose profits but nothing more, that loss “is essentially the failure of the purchaser to receive the benefit of its bargain,” and the allocation of that loss is the “core c o ncern” of private contracts and contract law. Id. at 870. Finally, the economic-loss rule promotes first-party loss insurance over third-party liability insurance. TESTBANK

, 752 F.2d at 1029. A regime of first-party loss insurance efficiently encourages the party with the best information (that is, the p a r ty with knowledge of its own risk of loss) to decide whether to assume, allocate, avoid,

or insure against its risk of loss. Id. ; see also Mt. Lebanon Personal Care Home, I n c . v . Hoover Universal, Inc. , 276 F.3d 845, 848 (6th Cir. 2002); Rardin , 8 9 0

See also E. R iver , 476 U.S. at 875 (noting economic-loss rule avoi ds reli ance 8 “on a fa r murkier li ne”). See als o Chevron USA, Inc. v. Aker Mar itime, Inc. , 604 F.3 d 888 , 900 (5th Cir. 9 201 0) (“The purpose of the doctrine is to mai ntai n the traditiona l distinction between contract and tort.”); Mt. Lebanon Pers onal Care Home, Inc. v. Hoove r Univers al, Inc. , 276 F .3d 845 , 848 (6th Cir. 200 2) (“Where tort la w, primarily out of a conc ern for safety, fixes the resp onsibi li ty for a defectiv e product directly on the parties resp onsibl e for placing the product into the stream of commerc e, contract la w giv es the p arties to a v enture the freedom to a ll ocate risk as they see fi t.”). 10 Case: 10-30516 Document: 00511522606 Page: 10 Date Filed: 06/28/2011No. 10-30516

F.2d at 26. First-party loss insurance also is the more feasible way to mitigate

1 0 disasters “inflicting large and reverberating injurie s th r ough the economy.” TESTBANK

, 752 F.2d at 1029. B. Louisiana’s version of the economic-loss rule Louisiana is free, of course, to accept, reject, or modify the economic-loss rule i n i t s o wn tort and products-liability law. As it happens, the Louisiana Supreme Court adopted a slightly modified version of the economic-loss rule in PPG Industries, Inc. v. Bean Dredging

. In PPG , a dredging contractor negligently damage d a pipeline owned by a natural-gas company. 447 So. 2d at 1060. As a result, the gas company was unable to fulfill a n a t u r a l-gas contract with a manufacturer, and the manufacturer was required to obtain fuel from another source at an increased cost. Id. The manufacturer sued the contractor in tort for its economic loss. Id. The Louisiana Supreme C o u r t rejected the claim, holding that the manufacturer’ s purely economic loss did “not fall within the scope of the protection intended by the law’s imposition of a duty on dredging contractors not to damage pipelines negligently.” Id. The court’s reasoning was succinct, and similar to the primary justification for t he economic-loss rule: for “policy reasons,” the law does not “require that a party who negligently causes injury to property must be held legally responsib l e to all persons for all damages flowing in a ‘but for’ sequence from the negligent c o n d u c t

. ” Id. at 1059, 1061. This is because the “imposition of responsibility on the t o r tfeasor for such

Cf. E. River , 476 U.S. a t 8 7 1 (noting economic losses “can be insured”) ; 1 0 Richard A. Posner, Common-Law Economi c Torts: An Economi c and Legal Analysis , 48 ARIZ

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. 735 , 73 7-38(200 6).
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damages could create liability in an indeterminate amount for an indeterminate time to an indeterminate class.” Id. at 1061 (quotation marks omitted). In other words, “[b]ecause the list of possible victims and the extent of economic damages might be expanded indefinitely, the court necessarily makes a policy decision on the limitation of recovery of damages.” Id. at 1061-62. The court c o n c l uded it

was “highly unlikely” that the “duty not to negligently injure property encompass the risk that a third party who has contracted with the owner of the injured property will thereby suffer an economic loss.” Id. at 1061. Although the reasoning and result in PPG flow from the standard economic-loss rule, certain language in the decision left the door open for caseby-case adjustments. PPG emphasized that policy considerations determine the “reach” of the rule, and instructed courts to consider whether there is an “ease of association” between “the rule of co n d u c t , t h e risk of injury, and the loss sought to be recovered.” Id. ; see als o Roberts , 605 So. 2d at 1054 (“The critical test in Louisiana, however, is phrased in terms of ‘the ease of association’ which

m e l d s p olicy and foreseeability into one inquiry: Is the harm which befell th e plaintiff easily a s s o c iated with the type of conduct engaged in by the defendant?”). PPG also instructed courts to “consider the particular case in the terms of the moral, social and economic values involved, as well as with a view toward the ideal of justice.” Id. Before applying PPG to the case at hand, we must address one final point. The plaintiffs emphasize that PPG conducted a “duty-risk” analy s i s . This is true, because PPG involved a c l a i m for negligence under Louisiana C ivil Code

a r t icle 2315, and the “Louisiana courts have adopted a duty-risk analys i s i n

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determining whether to impose liability under [article] 2315.” Pinsonneault v. 1 1 Merch. & Farmers Bank & Trust Co. , 816 So. 2d 270, 275 (La. 2002). To prevail under a duty-risk analysis, a plaintiff must prove five separate elements: 1. the defendant had a duty to conform his conduct to a specific standard (the duty element);
2. the defendant failed to conform his conduct to the appropriate standard (the breach of duty element);
3. t h e defendant’s substandard conduct was a cause-in-fact o f the plaintiff’s injuries (the cause-in-fact element);
4. the defendant’s substandard conduct was a legal cause of the plaintiff’s injuries (the scope of liability or scope of protection element); and
5. actual damages (the damage element). Roberts , 605 So. 2d at 1051. As discussed above, PPG was primarily concerned with the first, second, and fourth of these elements. Although our case involves claims under the LPLA, the parties agree that PPG still applies. Indeed, the plaintiffs’ main argument on appeal is that PPG’s duty-risk analysis provi d e s “the appropriate analysis for determining liability and causation.” For its part, the Louisia n a c o urt of appeal has twice applied PPG to the same LPLA claims asserted in this case. See Phillips , 10 So. 3d at 344; Phillips, 2011 WL 1773269, at *5. Moreover, other Louisiana courts of appeal have conducted duty-risk analyses in LPLA actions. See, e.g. , Marks v. OHMEDA, Inc. , 871 So. 2d 1148, 1153 (La. C t

. Ap p . 2004) (analyzing “legal fault” and “duty” in LPLA action); Goodrich v. Caterpillar, Inc. , 717 So. 2d 1235,

Article 231 5 states: “[e]very act whatev er of man that causes damage to 1 1 another obl iges him by whose fault it happened to repair it.” La. Civ. Code. art. 231 5. 13 Case: 10-30516 Document: 00511522606 Page: 13 Date Filed: 06/28/2011No. 10-30516

1237 (La. Ct. App. 1998) (same). In light of both the parties’ failure to contest 1 2 the issue as well as supporting decisions from the Louisiana courts of appeal, we

ar e not convinced that the Louisiana Supreme Court would decide that PPG do e s not apply to claims under the LPLA. Accord i n gl y , w e w ill apply PPG to the plaintiffs’ claims. To be sure, our best Erie guess is that the Louisiana Supreme Court would apply PPG to the pla intiffs’ claims. The LPLA imposes liability on manufacturers only for d a mages “proximately caused” by an unreasonably dangerous product. LA

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. § 9:2800.54(A); Stahl v. Novartis Pharm. Corp. , 2 8 3 F.3d 254, 261, 266 (5th Cir. 2002); Jack v. Alberto-Culver USA, Inc. , 949 So. 2d 1256, 1258 (La. 2007). As the Louisiana Supreme Court noted i n Ro berts v. Benoit , PPG may be thought of as a limitation on “legal or p r o x i m a t e cause.” 605 So. 2d at 1052, 1056; see also id. at 1052 (“[P]roxim a t e cause, or one of its functional equivalents, such as scope of the duty in duty-risk analysis, is necessary t o t r u ncate liability at some point.”). PPG thus fits comfortably within the plain language of the LPLA. Perhaps the more import a n t p o int is that PPG is “a policy decision in purest form” that does not turn on fine distinctions between “proximate cause, legal cause, or duty.” Id. at 1052. Although PPG specifically concerned a claim for negligence, its policy considerations apply with equal force in the productsliability context. See E. River , 476 U.S. at 871-74. Thus, just as PPGimposed

Cf. De de v. Ti

p’s De v. , L.L. C. , 16 So. 3d 526, 529- 30 (La. Ct. App

. 2009) (no ting that 1 2
a “duty/ris k analys is mus t be app lied” in cas es involving “injur y as the res ult of the cond itio n of a t hing, wh ethe r unde r a s tri ct liabil ity theo ry o r negligenc e l iabili ty theo ry”)

. 14 Case: 10-30516 Document: 00511522606 Page: 14 Date Filed: 06/28/2011No. 10-30516

a pragmatic limitation on the sweeping language of article 2315 of the Louisiana Civil Code, so too, we predict, it imposes a pragmatic limitation on the LPLA.

1 3 Our prediction is not a stretch. Liability under the LPLA is expressly tied to liability u n d er article 2315. The LPLA provides that “[c]onduct or circumstances that result in liability under this Chapter are ‘fau l t ’ within the meaning of Civil Code Article 2315.” LA

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. § 9:2800.52. Thus, as

one leading treatise notes, an LPLA claim against a manufacturer “continues to be in tort,” and “all the peripheral characteristics of tort actions not specifically governed by th e [ L P LA] continue to be applicable, such as . . . proximate

cause . . . .” W I L L I A M E

. C RAW F O R D , 12 L O U I S IA NA C I V I L LAW T R E AT I S E : T O R T LAW § 1 6

. 2 3 (2d ed. 2011); see also Quick v. Murphy Oil Co. , 643 So. 2d 1291, 1 295 (La. Ct. App. 1994) (recognizing same). As already discussed, one of th e peripheral characteristics of tort actions in Louisiana is that they are governed by PPG . We predict LPLA actions too are governed by PPG. C. Application Reasoning by analo gy, PPG strongly suggests that we should uphold
summary judgment i n this case. In PPG , a defendant negligently damaged property owned by a third party. As a r e s u l t , t h e third party was unable to supply a product to the plaintiff, and the plaintiff suffered purely economic loss. The Louisiana Supreme Court held, as a matter of policy, that the plaintiff could not recover its pu r e ly economic loss in tort. Similarly, in this case, Bayer damaged crawfish owned by crawfish farmers. As a r e s u l t , t h e farmers were unable to supply crawfish to t he plaintiffs, and the plaintiffs suffered purely

See PPG , 447 So. 2d at 105 9 (finding that al though “this case fall s l i t e ra l l y 13 withi n the exp ansive terms of La. C .C. Art. 2 315 . . . the customerc annot recover his indirect economic loss”). 15 Case: 10-30516 Document: 00511522606 Page: 15 Date Filed: 06/28/2011No. 10-30516

economic loss. The essential facts in this case th u s m i r r o r the facts in PPG

. Unless there is some convincing reason to distinguish PPG , it would seem that the policy considerations at issue in that case would counsel the same result in this case. The plaintiffs and others have pointed to three basic differences between t h i s c a s e and PPG , but we find that none justifies a different outcome. O n e difference is that the plaintiffs in this case did not have enforceable contracts to buy crawfish from the crawfish farmers. Thus, according to the plaintiffs, they “have no t otherwise protected themselves from risk – indeed they have no breach of contract claims against the Farmers.” I n other words, the plaintiffs assert that they should be permitted to recover against Bayer in tort because they cannot recover against the crawfish farmers in c o n t ract. That the plaintiffs

c hose to run their business without enforceable supply contracts i s n o t a satisfactory basis for dis t i n guishing PPG

. The plaintiffs are sophisticated participants in a multimillion-dollar commercial industry. J u s t as the manufacturer in PPG could have allocated the risk of a supply disruption in its contract with the natural-gas company, the plaintiffs here could have allocated the risk of a supply disruption by negotiating enforceable supply contracts in the first place. Indee d , b y n o t negotiating such contracts, the plaintiffs would
appear to have made a choice to bear the risk of a supply disruption, presumably because t h e y did not think that risk was worth the cost of reallocation or insurance. The plaintiffs’ own business calculation is not a s o u nd reason to impose indefinite liability on Bayer. If anything, the plaintiffs’ failure to negotiate enforceable contracts with the crawfish farmers diminishes the “ease of association” between the damaged crawfish and the plaintiffs’ e c o n o mic loss. In PPG , there was no ease of
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association between a damaged natural-gas pipeline and a manufacturer’s lost profits even though the manufacturer had a contractual right to obtain gas from the pipeline. In other words, PPG held that not even a binding, contractual right to buy a third party’s property was sufficient to create an e a s e o f a ssociation b e tw e e n negligent damage to that property and the plaintiff’s resultin g e c o no m ic loss. See Roberts , 605 So. 2d at 1056 (characterizing PPG as holding that there is no “ease of association” betwe e n the “duty not to damage someone else’s property” and “the risk that the other party’s business arrangements would be affected.”). Here, the association between the damaged craw f i s h and the plaintiffs’ economic loss is even more attenuated than in PPG

. Even assuming the plaintiffs had some inchoate “proprietary interest” in the farmers’ crawfish (as the plaintiffs contend), the plaintiffs still did not have an actual, enforceable right to buy those crawfish. The plaintiffs may hav e h a d r e a sonable expectations that they wo u ld be able to buy the crawfish, but the plaintiffs remained depe n d e n t on the farmers’ continued goodwill because the farmers could have sold their crawfish to other buyers at any time. U n d er such 14 circumstances, we find that the “ease of association” between Bayer’s allegedly negligent act and the plaintiffs’ purely economic loss is too attenuated to support

a cause of action in tort. As we have recognized before, “[i]f a plaintiff connected

The plai ntiffs’ expert a ss e rt s that if “crawfish farmers sell their output to 1 4 another b u y e r-proc essor , causing disrup tion to the buyer-process or’s supp ly of raw crawfish, the buyer-process or may retali ate by refus ing to purchase crawfish from that farmer in the future.” He a l so asserts that if a buyer-process or fail s to honor his purchase “commitment, ” “the crawfisherman would view that as bei ng ‘unloyal .’” Absent from the expert’s characterization of these informal enforc ement mechanisms (and the recor d) is any i ndication tha t the farmers or proc essor s would be entitl ed to lega l reli ef. 17 Case: 10-30516 Document: 00511522606 Page: 17 Date Filed: 06/28/2011No. 10-30516

to the damaged chatt e ls by contract cannot recover, others more remotely situated are foreclosed a fortiori .” TESTBANK , 752 F.2d at 1024. Even if the plaintiffs had some legal right to buy the farmers’ crawfish, we believe the Louisiana Supr e me Court still would reject their claims. As mentioned above, the existence of a contract was insufficient to justify recovery of pur e l y e c onomic loss in PPG

. This is consistent with the Louisiana courts’ refusal to recognize a cause of action for negligent interference with contractual rela t i o n s . See PPG , 447 So. 2d at 1060 n.1 (observing that “[r]ecovery of

econ o m i c losses for negligent interference with contractual relations is almost uniformly denied in other jurisdictions”); Carter v. Smith , 607 So. 2d 6, 7 (La. Ct. App. 1992) (“Louisiana does not recognize a c a u se of action for negligent interference with contract rights.”). Notably, in Great Southwest Fire 1 5 Insurance Co. v. CNA Insurance Cos. , the Louisiana Supreme Court refused to recognize a tort duty that “would, in ef f e c t , be to recognize

. . . something very similar to an action for negligent interference with contract.” 557 So. 2d at 969. The court’s reasoning in Great Southwest was essentiall y the same as its reasoning in PPG : the court sought to avoid the threat of “a chain of recoveries,” in which interference with one contr a ct “also prejudices the performance of another contract and so on more or less indefinitely.” Id. at 970. Indeed, Great

See als o Henn ig v. All tel Commc’ns, Inc. , 903 So. 2d 113 7, 114 1 (La. Ct. App

. 1 5 200 5) (“There exists no cause of action in Louisi ana for recovery of physical or economic damages arising from ne gli gent interferenc e with contractual relati ons of a third party.”); Colber t v. B.F. Car vin Co n str. Co. , 600 So. 2d 719 , 722 (La. Ct. App

. 199 2) (“We note that there is as yet no remedy i n Louisi ana for negli gent interfer ence with contract.”); cf. R E ST A T EM E NT (S E C O ND) O F T ORT S § 766 C cmt. a (“[T]her e is as ye t n o general rec ogniti on of li abi li ty for negli gent i nterfer ence with a n exi sting contr act or with a prosp ective contractual relati on . . . .”)

. 18 Case: 10-30516 Document: 00511522606 Page: 18 Date Filed: 06/28/2011No. 10-30516

Southwest analo gi z e d to th e e c o no m ic - lo s s rul e and observed that “while physical harm generally has limited effects, a chain reaction occurs when economic harm is done and may prod u c e a n unending sequence of financial effects best dealt with by insurance, contract, or othe r b u s i n e s s planning devices.” Id. Great So u thwest further recognized that courts generally “have refused to cross the bright line that has traditionally marked negligence claims for economic harm as off limits.” Id. The court stated that it would “proceed with caution” before expanding its “narrowly drawn action” for intentiona l i n t erference with contractual rights. Id. at 969. Here, the plaintiffs seek to impose a duty on Bayer that would, in effect, recognize a claim for negligent interference with cont r a c t ual relations: the plaintiffs expected to buy crawfish from the crawfish farmers, and the plaintiffs allege that Bayer negligently interfered with the farmers’ ability to satisfy that expectation. Moreover, the same policy c onsiderations addressed in Great Southwest (and PPG) beset this case. The plaintiffs are commercial parties who could have protected themselves though c o n tracts or insurance, and there are serious line-drawing problems concernin g whether other parties intimately associated with the crawfish industry (e.g., crawfish reta i l e rs, restaurants, employees) would be allowed to re c over as well. We see no indication that the Louisiana Supreme Court would be willing to extend tort liability to the type of iterative economic loss the plaintiffs seek to recover in this case. A second potential difference between PPG and t h i s c a se is that the plaintiffs here allege a “ symbiotic” relationship with the crawfish farmers. According to the plaintiffs, “the farmers and the Buyer/Processors are really one unified group and not two separate groups,” and harm to the latter is “inevitable if a defective product were to sterilize or kill the crawfish crops.” The problem
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with this argument i s that it is the same one addressed by the Louisiana Supreme Court in Roberts : “[a]lthough ease of association encompasses the idea of foreseeability, it is not based on foreseeability alone.” 605 So. 2d at 1045; cf. E. River , 4 7 6 U

. S

. at 874 (finding that foreseeability alone “is an inadequate brake” on products-liability law). The ease of association test “melds policy and foreseeability into one inquiry.” Roberts , 605 So. 2d at 1054. Thus, although it

was certainly foreseeable that negl i gently damaging a natural-gas pipeline would cause manufacturers relying on that pipeline to seek fuel elsewhere at an increased cost, PPG nonetheless held, as a matter o f p o l icy, that the manufacturer c o u l d n o t sue in tort for its purely economic loss. Similarly, although it may have been foreseeable (eve n “ p a r t icularly foreseeable,” as the plaintiffs contend) t hat damaging the farmers’ crawfish would cause crawfish
processors to lose business, that is not a sufficient reason to permit recovery of purely economic loss in tort. 1 6 A final factual difference between PPG and this case is that the plaintiffs here may not have had an alternative source of crawfish. The argument seems to be that Bayer’s alleged negligence impacted most if not all crawfish farmers in the industry, and thus the plaintiffs had no way to mitigate their losses. Of
course, as already discussed, one way for the plaintiffs to have mitigated their losses would have been to buy insurance or negotiate with the crawfish farmers

over the risk of a supply disruption. In any event, we do not think the extent of

We note that there is no evidence that Bayer knew anythi ng about Wil tz and 1 6 Beaucoup Crawfish in particular. Thus, al though Bayer may have foreseen harm to the crawfish industry ge n e ra l ly, there is no indicati on that it should have fores een harm to the pla inti ffsspecifical ly.

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a plaintiff’s (or an entire industry’s) loss determines the plaintiff’s right to relief in tort. PPG did not even address the extent of the plaintiff’s loss, and instead focused on the problem of allowing tort liability “in an indeterminate amount for

an indeterminate time to an indeterminate class.” 447 So. 2d a t 1 0 6 1

. This problem would be exacerbated, not solved, by a rule permitting recovery in tort for purely economic loss whenever the harm to an industry is most widespread. We note that o u r d ecision is consistent with other decisions by the Louisiana courts of a p p e al in similar cases. First, in the Phillips litigation, a five-judge panel of the Louisiana court of appeal has already held that PPG bars the exact same claims asserted here. Phillips , 10 So. 3d at 342-44. Although a three-judge panel of the same court recently “declined to follow” the five-judge panel, the three-judge panel notably did not hold that the plaintiffs were entitled to relief. Phillips , 2011 WL 1773269, at *8 (declining to “speculate on the result of the required duty-risk a n a l y sis”). Because we have conducted a duty-risk analysis and applied PPG to this case, our decision is consist ent with both the three-judge panel’s decision and the five-judge panel’ s d e c ision. Second, in Dempster v. Louis Eymard Towing Co. , a Louisiana c o u r t of appeal held that fishermen could not recover purely economic loss from a barge that ruined a fishing site that the plaintiffs did not own. 503 So. 2d 99, 101 (La. Ct. App.), writ denied , 505 So. 2d 1136 (La. 1987). Notably, the plaintiffs could not recover even though they had been fishing in the spot “for years” and had invested capital in their fishing enterprise. Id. at 100. Similarly, in Louisiana Crawfish Producers Association-West v. Amerada Hess Corp. , a Louisiana court of appeal concluded that crawfishermen could not recover purely economic loss against oil comp ani es that ruined a crawfishing site t h a t t h e p l a intiffs did not own. 935 So. 2d 380,

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383-84 (La. Ct. App.), writ denied , 943 So. 2d 1094 (L a . 2006). Each of these

cases is analogous, if not identical, to the case at hand. Their consistent results,

as well as the Louisiana Supreme Court’s cons i s t e n t r efusal to review those results, reinforce our prediction that the Louisiana Supreme C o u r t would not recognize the relief the plaintiffs seek in this case. To conclude, after considering the Louisiana Supreme Court’s decision in PPG , as well as the legally relevant moral, social, and economic values involved,

we find that there is no “ease of association” between the damage to the farmers’ crawfish and the plaintiffs’ purely economic loss. Although there may be some

cases in which the Louisiana Supreme Court would authorize recovery in tort for purel y economic loss, we do not think this commercial dispute is one of those cases. Accordingly, we affirm the district court’s grant of summary judgment. D. Certification As a final matter, the plaintiffs have requested that we ask the Louisiana Supreme Court to define “the level or degree of ‘proprietary’ interest sufficient to state a cause of action for economic damages.” We may certify a determinative question of Louisiana law to the Louisiana Supreme Court if the question is not resolved by the “clear controllin g p r ecedent” of the Louisiana Supreme Court. LA

. R E V

. S TAT

. AN N

. § 13:72. 1(A). We are “chary about certifying questions of law absent a compelling re a son to do so.” Jeffers o n v . Lead Indus. Ass’n., Inc. , 106 F.3d 1245, 1247 (5th Cir. 1997). Certification may be appropriate when there are “genuinely unsettled matters of state law.” Id. On the other hand, the mere “absence of a definitive answer from the state supreme court on a particular question is not sufficient to warrant certification.” Id.

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We find that there is no compelling reason to certify the plaintiffs’ proposed question to the Louisiana Supreme Court. A f iv e-judge panel of the Louisiana court of ap p e al already has rejected the plaintiffs’ arguments. Phillips , 10 So. 3d at 344. The Louisiana Supreme Court already has declined (twice) to consider those arguments. Phillips , 21 So. 3d 284 (La. 2009), reh’g not considered , 24 So. 3d 871 (La. 2010). Id. And in any event, as discussed above,

w e think this case is resolved by the Louisiana Supreme Court’s clear a n d controlling decision in PPG

. IV. CONCLUSION For the reasons stated, we AFFIRM summary judgment. Bayer’s motion to strike is DENIED. The plaintiffs’ mot i o n t o certify and motion to stay are DENIED.

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