Court Opinion

ID: 4538987
Source: CourtListenerOpinion
Date Created: 2020-06-04 18:00:45.926749+00
Date Added: 2024-06-11T08:49:18.644552
License: Public Domain

Case: 19-40299   Document: 00515440589     Page: 1   Date Filed: 06/04/2020

        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT
                                       United States Court of Appeals
                                                Fifth Circuit

                                                                 FILED
                                                               June 4, 2020
                                 No. 19-40299                 Lyle W. Cayce
                                                                   Clerk

PERRY BONIN; ACE CHANDLER; MICHAEL MANUEL; ROBERT
ACREMAN; JACQUELINE ACREMAN, et al

             Plaintiffs - Appellants

v.

SABINE RIVER AUTHORITY OF LOUISIANA; ENTERGY TEXAS,
INCORPORATED; ENTERGY LOUISIANA, L.L.C.; CLECO POWER, L.L.C.,

            Defendants - Appellees
_______________________________________________________________________

LARRY ADDISON; JOYCE ADDISON; RICKY ALEXANDER; WILLIAM
BALL; ERNEST BEVELHYMER, et al

             Plaintiffs - Appellants

v.

SABINE RIVER AUTHORITY OF LOUISIANA; ENTERGY TEXAS,
INCORPORATED; ENTERGY LOUISIANA, L.L.C.; CLECO POWER, L.L.C.,

             Defendants - Appellees

                Appeal from the United States District Court
                     for the Eastern District of Texas

Before JOLLY, JONES, and ENGELHARDT, Circuit Judges.
    Case: 19-40299    Document: 00515440589     Page: 2   Date Filed: 06/04/2020

                                 No. 19-40299
E. GRADY JOLLY, Circuit Judge:
      These consolidated cases arise from a 2016 incident of flooding around
the Toledo Bend Reservoir and the Sabine River, which constitutes a boundary
between Texas and Louisiana. Plaintiffs, owners of property near the river,
sued in Texas state court the state authorities and power companies who
operate the reservoir, alleging that defendants caused the flooding and
damaged their properties. The defendants removed the case to federal court,
which remanded back to state court. After much procedural maneuvering, the
cases were eventually removed a second time to the federal district court in
Texas, which, on this occasion, denied a motion to remand. The district court
later entered a final judgment granting the motion to dismiss all claims against
the power companies and remanding the remaining claims against the state
authorities to Texas state court. The plaintiffs now appeal that order. They
argue that the federal court’s order dismissing their claims should be vacated
because the claims belong in state court. They also argue that the dismissal of
the claims against the power companies was wrong on the merits.
      We hold that the district court did not err in denying the motion to
remand. We further hold that because plaintiffs do not brief, or otherwise
challenge, two independent reasons given by the district court for dismissal of
their claims against the power companies, we affirm the district court’s
judgment dismissing all claims against the power companies.             Finally,
plaintiffs do not challenge the district court’s declination of supplemental
jurisdiction over the remaining claims against the state authorities. We thus
affirm the remand of those claims as well. Consequently, the district court’s
judgment is AFFIRMED in full.
                                       I.
      “The Sabine River meanders between Texas and Louisiana. Two state
agencies jointly regulate the Sabine River’s waterways: the Sabine River
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                                  No. 19-40299
Authority of Louisiana and the Sabine River Authority of Texas.” Simmons v.
Sabine River Authority La., 732 F.3d 469, 471 (5th Cir. 2013). Since 1963, the
Federal Energy Regulatory Commission (“FERC”) has licensed these two
authorities to operate and maintain a “dam[,] . . . a large reservoir, a spillway,
and a hydroelectric plant” on the river. Id. at 472. This project is known as
the Toledo Bend Reservoir and Toledo Bend Dam.
      In March 2016, heavy rains led to heavy water inflow into the reservoir
and flooding of the Sabine River. A group of around 300 property owners in
Texas and Louisiana who live near the river (the “Bonin plaintiffs” or
“plaintiffs”) brought suit against Sabine River Authority, Louisiana (“SRA-L”)
and Sabine River Authority of Texas (“SRA-T”) in Texas state court. The
parties dispute the specifics of how and why the flooding occurred.          The
plaintiffs alleged that their properties were damaged by the flooding, and
generally alleged that the flooding was caused or exacerbated by the reservoir’s
water level becoming too high and the spillway gates at the reservoir being
intentionally opened by the river authorities. These plaintiffs, in their original
suit, brought only takings claims against SRA-T and SRA-L under the Texas
and Louisiana Constitutions.
      The case was removed to federal court but then remanded to state court
on the grounds that the takings claims did not raise a question of federal law.
Back in Texas state court, the plaintiffs amended their complaint to expand
their claims. They included claims against the power companies Entergy
Texas, Entergy Louisiana, and Cleco Power (“the Entergy defendants” or
“Entergy”) based on an agreement the companies had with the two Sabine
River Authorities “to oversee the generation of power and to purchase the
generated power” at the Toledo Bend Dam. Simmons, 732 F.3d at 472. The
plaintiffs alleged that the Entergy defendants allowed one of two hydroelectric
generators at the dam to remain inoperational for six months. They alleged
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that this contributed to raising the reservoir water levels and made the flood
damage worse. The plaintiffs further asserted claims for negligence, trespass,
and private nuisance against the Entergy defendants.
      SRA-T removed the case a second time to the Eastern District of Texas,
asserting that with the addition of the claims against the Entergy defendants,
the plaintiffs had created federal-question jurisdiction.         The Entergy
defendants filed a joint consent to removal and argued that, additionally, there
was federal jurisdiction because the suit qualified as a “mass action” under the
Class Action Fairness Act. SRA-L did not file a consent to removal.
      The plaintiffs moved to remand again. They argued that the necessary
unanimous consent of the defendants to removal was lacking because SRA-L
did not consent. They also argued that there was no federal subject-matter
jurisdiction because the new claims against Entergy were entirely state-law
claims. In response to SRA-T’s alternative argument that the suit qualified as
a mass action, plaintiffs argued that an exception to mass action jurisdiction
applied because all of the claims in the suit arose from an event that occurred
in the state of filing, namely Texas.
      A federal magistrate judge, to whom pre-trial management had been
referred, recommended that remand be denied. The magistrate judge found
that SRA-L’s consent to removal was unnecessary because it was not a properly
served defendant.    The magistrate judge also found that federal-question
jurisdiction existed because the claims against Entergy implicitly and
necessarily alleged violations of federal standards set by FERC.            The
magistrate judge made no reference to defendants’ mass action basis for federal
jurisdiction.
      The plaintiffs did not file an objection to the magistrate judge’s report
and recommendation, and it was adopted by the district court. The district
court then granted plaintiffs leave to amend their complaint once again, and
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                                  No. 19-40299
the plaintiffs added language explicitly claiming that Entergy had violated the
requirements of the FERC license.
        Meanwhile, another lawsuit alleging virtually identical claims was filed
in Texas state court by another group of property-owning plaintiffs (the
“Addison plaintiffs”). That case was removed to federal court, and the Addison
plaintiffs did not move for remand. Once in federal court, the Addison and
Bonin cases were consolidated. The district court ordered that the Addison
plaintiffs would be “added to, and included under,” the Bonin plaintiffs’
complaint and that subsequent rulings would apply to both. The district court
then ordered the plaintiffs in the now-consolidated cases to file a more definite
statement alleging how specifically the Entergy defendants had violated FERC
standards, which they did.
        After the plaintiffs filed their more definite statement, the Entergy
defendants filed a Rule 12(b)(6) motion to dismiss the claims against them.
The motion was referred to the magistrate judge, who recommended that the
negligence claim against Entergy be dismissed based on three independently
sufficient reasons and that the nuisance and trespass claims also be dismissed.
The district court adopted the report and recommendation over the plaintiffs’
objections, finding each of the three independently sufficient reasons noted by
the magistrate judge to be correct regarding the negligence claim and also
finding the magistrate judge correct with regard to the nuisance and trespass
claims. The district court therefore dismissed all of the claims against the
Entergy defendants. Because “the only remaining claims in the suit involve[d]
the state constitutional takings claims against” SRA-T and SRA-L, the court
remanded the consolidated cases to Texas state court from whence they had
come.

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                                       No. 19-40299
       Plaintiffs timely appealed the order granting Entergy’s motion to dismiss
and remanding the remaining claims.1 First, plaintiffs argue that the order
should be vacated because the earlier motion to remand should have been
granted. Second, they challenge the dismissal of the negligence claim on the
merits.
       SRA-T and SRA-L are not parties to this appeal.
                                             II.
       We first will consider the denial of remand. The parties dispute whether
we should review the denial of remand for plain error or de novo. Because our
conclusion would be the same under either standard of review, we will review
the denial de novo.
       The plaintiffs argue that the denial of remand was erroneous for two
reasons: that there was no federal subject-matter jurisdiction at the time of
removal, and that the lack of SRA-L’s consent to removal made removal
improper. We will address these two arguments respectively.
                                             A.
       The federal removal statute requires, among other things, that a
removed case must be a civil action “of which the district courts of the United
States have original jurisdiction.” 28 U.S.C. § 1441(a). A motion to remand is
evaluated “on the basis of claims in the state court complaint as it exists at the
time of removal.” Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 264

       1 An order declining to exercise supplemental jurisdiction and remanding a case to
state court is appealable. See Carlsbad Technology, Inc. v. HIF Bio, Inc., 556 U.S. 635, 636
(2009); Camsoft Data Systems, Inc. v. S. Electronics Supply, Inc., 756 F.3d 327, 332 (5th Cir.
2014). Although the district court did not set out its judgment in a separate document as
required by Fed. R. Civ. P. 58(a), “[a] failure to set forth a judgment or order on a separate
document when required by [Rule] 58(a) does not affect the validity of an appeal from that
judgment or order.” Moreno v. LG Electronics, USA Inc., 800 F.3d 692, 696 (5th Cir. 2015)
(quoting Fed. R. App. P. 4(a)(7)(B)).
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                                      No. 19-40299
(5th Cir. 1995). Thus, the denial of remand was proper only if federal subject-
matter jurisdiction existed over the Bonin case at the time of its removal.
       We hold that federal jurisdiction obtained at the time of removal because
the Bonin suit qualified at that point in time, and subsequently, as a “mass
action” under the federal Class Action Fairness Act (CAFA).2
       It is undisputed that CAFA provides for federal jurisdiction over a “mass
action.” 28 U.S.C. § 1332(d)(11)(A). It is our task to determine whether the
plaintiffs’ lawsuit qualifies as a mass action. “[T]he term ‘mass action’ means
any civil action . . . in which monetary relief claims of 100 or more persons are
proposed to be tried jointly on the ground that the plaintiffs’ claims involve
common questions of law or fact[.]” Id. at § 1332(d)(11)(B)(i). Besides meeting
this definition, however, federal jurisdiction over a mass action additionally
requires that the suit satisfy three other prerequisites. First, there must be
“minimal diversity” such that “any member of a class of plaintiffs is a citizen
of a State different from any defendant.” Id. at §§ 1332(d)(2)(A), (d)(11)(A).
Second, the aggregate amount in controversy must exceed $5 million. Id. at
§§ 1332(d)(2), (d)(6), (d)(11)(A). And third, “at least one plaintiff’s claim [must]
satisf[y] the $75,000 individual amount in controversy” requirement.
Robertson v. Exxon Mobil Corp., 814 F.3d 236, 239 (5th Cir. 2015) (citing 28
U.S.C. §§ 1332(a), (d)(11)(B)(i)).
       The plaintiffs do not dispute that the Bonin suit met all these
prerequisites at the time of removal. They argue, however, that the case did

       2 The district court found federal subject-matter jurisdiction present on the grounds
that the operative complaint implicitly alleged a violation of federal standards set by FERC.
We may, however, affirm the judgment of the district court for any reason supported by the
record. United States v. Gonzalez, 592 F.3d 675, 681 (5th Cir. 2009). Because we find that
the suit qualified as a mass action, we pretermit the question whether the operative
complaint at the time of removal also raised a federal question.

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                                       No. 19-40299
not qualify as a mass action because it falls under one of CAFA’s exceptions to
“mass action” jurisdiction. The exception provides that “the term ‘mass action’
shall not include any civil action in which . . . all of the claims in the action
arise from an event or occurrence in the State in which the action was filed,
and that allegedly resulted in injuries in that State or in States contiguous to
that State.” 28 U.S.C. § 1332(d)(11)(B)(ii)(I).
       Plaintiffs assert that the suit meets this exception because: (1) all of the
claims arise from the flooding of the Sabine River in March 2016; (2) that
flooding qualifies as an “event or occurrence” as we have previous defined it;3
(3) that flooding occurred in Texas, the state where the action was filed; and
(4) all of the plaintiffs’ injuries occurred in either Texas or Louisiana, which is
contiguous to Texas.
       We find that plaintiffs’ argument fails on the third of these four points.
Plaintiffs concede that the March 2016 Sabine River flooding event occurred in
both Texas and Louisiana.4 But plaintiffs argue that the flooding in Louisiana
does not “negate the fact that the rainfall and flooding took place in Texas.”
By way of linguistic analogy, plaintiffs demonstrate their logic saying that it
would be accurate to describe the current COVID-19 pandemic as occurring “in
Louisiana,” notwithstanding the fact that it is also occurring in the other 49
states.
       Well, not quite. The statutory language, when read in context of the
exception as a whole, makes this interpretation patently untenable.                        We
remind that the exception requires: “all of the claims in the action arise from

       3 We have held that an “event or occurrence” may be “constituted by a pattern of
conduct in which the pattern is consistent in leading to a single focused event that culminates
in the basis of the asserted liability.” Rainbow Gun Club, Inc. v. Denbury Onshore, L.L.C.,
760 F.3d 405, 412 (5th Cir. 2014).
       4 The border between the two states runs down the middle of the river. See Texas v.

Louisiana, 426 U.S. 465, 465–66 (1976).
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an event or occurrence in the State in which the action was filed, and that
allegedly resulted in injuries in that State or in States contiguous to that
State.” 28 U.S.C. § 1332(d)(11)(B)(ii)(I) (emphasis added). Even if we say that
the March 2016 flooding occurred “in Texas,” we still could not possibly
conclude that all of the claims in the suit arose from the flooding event “in
Texas.” The plaintiffs concede that many of the plaintiffs in this suit own
flooded property in Louisiana, and their claims arise from the flooding that
occurred on the Louisiana side of the Sabine River, not in Texas. An event that
occurs on both sides of the border between two states, which leads to claims in
both states, is not local to either of those states and, consequently, does not
meet the terms of the exception.
       To conclude: the exception for a local single event does not apply to the
2016 flooding event. The Bonin suit, thus enjoying no exception from the
statute, qualified as a mass action. It follows that the suit had a federal home
at the time it first entered the door.5
                                             B.
       The plaintiffs further argue, however, that remand should have been
granted because SRA-L declined to consent to removal. In general, removal
requires that “all defendants who have been properly joined and served must
join in or consent to the removal of the action.” 28 U.S.C. § 1446(b)(2)(A).
CAFA, however, provides an exception to this general rule. Under CAFA, mass

       5 We need not address whether the Addison case was properly removed. Unlike the
Bonin plaintiffs, the Addison plaintiffs never moved to remand their case. Where a party
“objects to removal only after losing at the district court level, that party has waived all
objections to removal jurisdiction.” Camsoft, 756 F.3d at 333 (citation omitted) (emphasis
removed). After the Addison case was removed, it was consolidated with the Bonin case,
including its complaint and the more definite statement explicitly alleging a FERC violation.
Thus, federal-question jurisdiction existed at the time of judgment in the Addison case, and
the order dismissing the claims against Entergy and remanding the remaining claims to
Texas state court applied to both the Bonin and Addison plaintiffs.
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                                    No. 19-40299
actions “may be removed by any defendant without the consent of all
defendants.” 28 U.S.C. § 1453(b); see also Frazier v. Pioneer Americas LLC,
455 F.3d 542, 546–47 (5th Cir. 2006) (“CAFA eliminated the requirement of
unanimity of consent to removal.”). Since the Bonin suit qualified as a mass
action, SRA-L’s consent to removal was not required.6 Accordingly, the district
court correctly denied the plaintiffs’ motion for remand based on the lack of
consent by SRA-L.
                                          III.
      Finally, we turn our attention to the motion to dismiss—that is, whether
the district court erred in dismissing the claims against the power companies.
We review the grant of a motion to dismiss de novo. Walch v. Adjutant Gen.
Dep’t of Tex., 533 F.3d 289, 293 (5th Cir. 2008).
      First, the negligence claims, which are the crux of this appeal. The
magistrate judge’s report and recommendation, which the district court
adopted over plaintiffs’ objections, found that the plaintiffs failed to state a
claim for negligence against the Entergy defendants upon which relief can be
granted for three independently sufficient reasons. First, the magistrate judge
found that the plaintiffs “did not adequately allege any violations of the FERC
license” by Entergy, because the FERC license does not impose minimum
energy generation requirements upon Entergy for either of the generators.
Second, the magistrate judge found that under Texas state law, only state
authorities may be found liable for damage caused by floodwaters, not private
entities like Entergy and Cleco; in short, a state rule granting immunity to
private entities would bar liability even if Entergy violated the FERC license.
Third and finally, the magistrate judge found that the plaintiffs failed to show

      6 The district court found that SRA-L’s consent was not required because SRA-L was
not properly served. Once again, we pretermit the question whether SRA-L was properly
served because we can affirm on the grounds that the suit qualified as a mass action.
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                                  No. 19-40299
that Entergy’s operation of the generators was a proximate cause of plaintiffs’
losses. It follows, of course, that even if causation of the flood waters had been
proved against Entergy, the unchallenged findings of the absence of liability
would have rendered causation a cipher, providing no relief to the plaintiffs.
      Yet, in their briefing to this court, plaintiffs have challenged only this
third of three independent grounds for dismissal of their negligence claim. Or,
even more to the point, plaintiffs have suggested no reason to even question
the validity of the other two independent grounds upon which the district court
based its dismissal. Since the plaintiffs have thus waived any argument with
respect to the Entergy defendants’ liability, we affirm the dismissal of the
plaintiffs’ negligence claim against the Entergy defendants. See United States
v. Thibodeaux, 211 F.3d 910, 912 (5th Cir. 2000); In re McCann, 268 F. App’x
359, 364 (5th Cir. 2008).
      The district court also dismissed the plaintiffs’ trespass and nuisance
claims against Entergy. Plaintiffs have not challenged these dismissals in
their briefing to this court, and so these dismissals are affirmed as well.
      Finally, plaintiffs have not challenged the district court’s conclusion
that, with the dismissal of all claims against the Entergy defendants,
supplemental jurisdiction over the remaining claims against the state
authorities should be declined.      We therefore affirm the remand of the
remaining claims against the state authorities to Texas state court.
                                       IV.
      In this opinion, we have found that the district court did not err in
finding that federal subject-matter jurisdiction existed over the Bonin suit at
the time of its removal; nor did it err in holding that SRA-L’s consent was not
necessary for its removal. We therefore affirm the denial of remand.
      We have also found that the plaintiffs have failed to brief two of the
independent reasons stated by the district court for the dismissal of their
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                                     No. 19-40299
negligence claims against the Entergy defendants, and we therefore affirm
that dismissal.     We also affirm the dismissal of plaintiffs’ nuisance and
trespass claims against Entergy because plaintiffs have failed to brief those
claims. Finally, we affirm the remand of the remaining claims against the
state authorities to Texas state court, which ended the proceedings in federal
court.7
      In sum, the judgment of the district court is, in all respects,

AFFIRMED.

      7  As noted supra note 5, the dismissal of all claims against the Entergy defendants
and remand of all remaining claims against the state authorities applies to both the Bonin
and Addison cases, which were consolidated and combined into a single complaint prior to
the district court’s final order.
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