Court Opinion

ID: 4104175
Source: CourtListenerOpinion
Date Created: 2016-12-02 20:01:12.610597+00
Date Added: 2024-06-11T07:46:04.881579
License: Public Domain

PUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 15-2263

JANET D. LEICHLING, individually, surviving spouse, and
Personal Representative of the Estate of John G. Leichling;
DAWN M. ROSE, surviving daughter of John G. Leichling;
GREGORY A. LEICHLING, surviving son of John G. Leichling;
CATHERINE L. TIMMS, surviving daughter of John G. Leichling;
HELEN CATTERTON, surviving daughter of John G. Leichling;
JOHN R. LEICHLING, surviving son of John G. Leichling,

                Plaintiffs - Appellants,

           v.

HONEYWELL INTERNATIONAL, INC.,

                Defendant - Appellee.

Appeal from the United States District Court for the District of
Maryland, at Baltimore.    Richard D. Bennett, District Judge.
(1:14-cv-02589-RDB)

Argued:   October 25, 2016                 Decided:   December 2, 2016

Before AGEE, DIAZ, and THACKER, Circuit Judges.

Affirmed by published opinion. Judge Thacker wrote the opinion,
in which Judge Agee and Judge Diaz joined.

ARGUED: Jeffrey John Utermohle, LAW OFFICES OF PETER G. ANGELOS,
P.C., Baltimore, Maryland, for Appellants.        Michael David
Daneker, ARNOLD & PORTER LLP, Washington, D.C., for Appellee.
ON BRIEF: Gary J. Ignatowski, Patrick A. Ciociola, LAW OFFICES
OF PETER G. ANGELOS, P.C., Baltimore, Maryland, for Appellants.
Anne P. Davis, Eric A. Rey, Allyson Himelfarb, ARNOLD & PORTER
LLP, Washington, D.C., for Appellee.

                              2
THACKER, Circuit Judge:

            The   survivors       of   John      R.   Leichling    sued   Honeywell

International, Inc., alleging that Mr. Leichling’s fatal lung

cancer resulted from exposure to toxins during his employment at

the   Dundalk     Marine       Terminal     in     Baltimore,     Maryland,     where

Honeywell    operates      a    chemical       manufacturing    plant.        Decades

earlier,    Honeywell      began    using        chemical   refuse   to   create   a

landmass on which the Marine Terminal later sat.                     The district

court dismissed the suit pursuant to Maryland’s 20-year statute

of repose, which bars untimely claims for injuries resulting

from a “defective and unsafe condition of an improvement to real

property.”      Md. Code Ann., Cts. & Jud. Proc. § 5-108(a).                      The

court reasoned that, because the refuse filled otherwise aquatic

areas and allowed development of the Marine Terminal, it was an

improvement to real property.             This appeal followed and, for the

reasons below, we affirm.

                                          I.

                                          A. 1

             From 1854 through 1985, Honeywell International, Inc.

(“Appellee”) manufactured chromium, a heavy metal, at a plant in

      1Because we are ruling on a motion to dismiss, we assume as
true the facts as stated in the complaint. See A Soc’y Without
A Name v. Virginia, 655 F.3d 342, 346 (4th Cir. 2011).

                                           3
an area now known as Harbor Point in Baltimore, Maryland. 2                 This

operation produced as much as 100,000 tons of waste per year,

including    chromium     ore     processing     residues    (“COPR”).      COPR

contains hexavalent chromium, which the Environmental Protection

Agency classifies as a powerful carcinogen.              Hexavalent chromium

is   water   soluble   and   thus    may    spread   through    surface   water,

groundwater, and drinking water, and exposure may also occur

through dust and dirt.            The complaint states Appellee knew of

the dangers associated with COPR as early as the 1930s.

              Beginning      in   the   1940s,    Appellee     stockpiled   COPR

waste for extended periods at and around docks, piers, wharves,

and other work areas at Harbor Point.                During the same period,

Appellee owned 85 acres of land adjacent to the Dundalk Marine

Terminal.     The following decade, Appellee began using COPR waste

and other material as fill to expand this area.

             In 1967, the Maryland Port Authority bought Appellee’s

85-acre property and used it to expand the Marine Terminal. 3                The

      2 According to the complaint, Appellee bears successor
liability for predecessor corporations that maintained chromium
processing and production operations at Harbor Point, including
Mutual Chemical Company, Allied Chemical & Dye Corporation,
Allied Chemical Corporation, and Allied Signal, Inc., the last
of which merged with Appellee in 1999.
      3Appellee provided its agreement with the Port Authority as
an attachment to its briefing in support of dismissal. See J.A.
220–26.   Citations to the “J.A.” refer to the Joint Appendix
filed by the parties in this appeal.

                                        4
contract      between     Appellee        and    the     Port    Authority        required

Appellee      to    deposit     in    the    Marine      Terminal     any    COPR     fill

Appellee produced at its Baltimore plant, aside from quantities

Appellee required for its own use, or pay the Port Authority for

failing to do so.         The Port Authority continued to utilize COPR

fill for the Marine Terminal expansion until 1976.

                                            B.

              The     survivors      of   John    R.     Leichling     (“Appellants”)

brought    various      tort    claims      against      Appellee     in    the   Circuit

Court for Baltimore City, Maryland, asserting Mr. Leichling’s

2012 death from lung cancer resulted from COPR exposure during

his employment as a longshoreman from 1973 through 2001 at the

Dundalk Marine Terminal.

              Appellee        removed     the    case     to    the    United      States

District      Court     for    the    District      of    Maryland     and    moved    to

dismiss, arguing Maryland’s statute of repose bars Appellants’

claims and, alternatively, Appellants fail to state plausible

claims for relief.             While the motion was pending, Appellants

filed a Second Amended Complaint, to which Appellee responded

via reply brief rather than a second motion to dismiss.                               The

district court agreed with Appellee, holding Maryland’s statute

of   repose    bars    Appellants’        claims.        The    district     court    thus

dismissed the claims with prejudice and this appeal followed.

                                             5
                                             II.

               Dismissal      under        Federal       Rule       of   Civil    Procedure

12(b)(6) is subject to de novo review.                         See King v. Rubenstein,

825 F.3d 206,    214    (4th    Cir.    2016).           An   affirmative     defense

permits 12(b)(6) dismissal if the face of the complaint includes

all necessary facts for the defense to prevail.                           See Goodman v.

Praxair, Inc., 494 F.3d 458, 464 (4th Cir. 2007).                                   A court

passing on a motion to dismiss may consider attachments to a

complaint or the motion to dismiss if “integral to the complaint

and authentic.”           Philips v. Pitt Cty. Mem’l Hosp., 572 F.3d 176,

180 (4th Cir. 2009).           Because this is a diversity case, Maryland

law applies.          See 28 U.S.C. § 1652; Erie R.R. Co. v. Tompkins,

304 U.S. 64, 78 (1938).

                                             III.

               In   the    1960s     and    1970s,       the    demise    of     privity   of

contract as a defense and the introduction of the discovery rule

increased       liability      for     defective         or     unsafe     conditions      in

improvements to real property.                 See Rose v. Fox Pool Corp., 643
A.2d 906,    912–13       (Md.    1994).         In    response,       states    enacted

statutes protecting those who would be particularly susceptible

to claims arising from such improvements; Maryland’s statute of

repose is one such statute.                See id.       The statute provides, with

limited exceptions,

                                              6
      no cause of action for damages accrues and a person
      may not seek contribution or indemnity for damages
      incurred when wrongful death, personal injury, or
      injury to real or personal property resulting from the
      defective and unsafe condition of an improvement to
      real property occurs more than 20 years after the date
      the entire improvement first becomes available for its
      intended use.

Md. Code Ann., Cts. & Jud. Proc. § 5-108(a).                            After courts

applied    the      statute     to    bar          claims        against      asbestos

manufacturers,      the   Maryland      General           Assembly       adopted       an

amendment to exclude asbestos from the protection of the statute

of repose.      This exception was adopted only after “considerable

debate    within    the   legislature.”             Rose, 643 A.2d     at    914

(discussing § 5-108(d)(1)).

           Otherwise,     the   statute          bars    suits    in    which    (1)     a

plaintiff’s alleged injuries resulted from an “alleged defective

and unsafe condition of ‘an improvement to real property’”; and

(2) 20 years have elapsed “since the ‘entire improvement first

be[came] available for its intended use.’”                       Rose, 643 A.2d at

910   (alteration    in   original)     (quoting          §    5-108(a)).            Here,

Appellants only challenge the district court’s analysis of the

first prong.

           To    determine    whether       an    item    is     an    “improvement,”

courts apply a “common sense” test, which defines an improvement

as

      [a] valuable addition made to property (usually real
      estate) or an amelioration in its condition, amounting

                                        7
      to more than mere repairs or replacement, costing
      labor or capital, and intended to enhance its value,
      beauty or utility or to adapt it for new or further
      purposes.   Generally has reference to buildings, but
      may also include any permanent structure or other
      development, such as a street, sidewalks, sewers,
      utilities, etc.   An expenditure to extend the useful
      life of an asset or to improve its performance over
      that of the original asset.      Such expenditures are
      capitalized as part of the asset’s cost.

Rose, 643 A.2d at 918 (alteration in original) (quoting Black’s

Law   Dictionary   757     (6th   ed.   1990)).    In   making   this

determination, courts consider “the nature of the addition or

betterment, its permanence and relationship to the land and its

occupants, and its effect on the value and use of the property.”

Id. (citing Allentown Plaza v. Suburban Propane, 405 A.2d 326,

332 (Md. 1979)).

          Courts should not “artificially extract each component

from an improvement to real property and view it in isolation.”

Hickman, ex rel. Hickman v. Carven, 784 A.2d 31, 38 (Md. 2001)

(quoting Hilliard v. Lummus Co., 834 F.2d 1352, 1356 (7th Cir.

1987)).   Instead, an item may be “an improvement if it is an

integral component of a project that itself would qualify as an

improvement.”   Id. 4    For example, in Hickman, ex rel. Hickman v.

      4 Although the Hickman court merely assumed that the
integral component doctrine applied for purposes of resolving
that case, the doctrine has been widely accepted in other
jurisdictions. See, e.g., Associated Elec. & Gas Ins. Servs. v.
BendTec, Inc., 822 F.3d 420, 424 (8th Cir. 2016); Ambrosia Land
Invs., LLC v. Peabody Coal Co., 521 F.3d 778, 781–83 (7th Cir.
(Continued)
                                   8
Carven, the Maryland Court of Appeals held that the statute of

repose did not bar claims of residential subdivision lot owners

against subdivision developers for demolishing a burial site.

See   id.    at   38–39.   The   court   reasoned   that,   though   the

developers may have removed the burial site while developing the

land, doing so was not only unnecessary for development but also

illegal and thus not an integral component of development.           See

id.       Conversely, Rose applied the statute to bar a swimmer’s

claims for injuries against a pool manufacturer because the pool

was “a permanent addition, excavated and built into the real

property, which enhances the value of the entire premises.” 643
A.2d at 918. 5

2008); Durham v. Herbert Olbrich GMBH & Co., 404 F.3d 1249,
1255–57 (10th Cir. 2005); Adair v. Koppers Co., Inc., 741 F.2d
111, 114–16 (6th Cir. 1984).     We thus have little reason to
doubt that it would find favor with Maryland courts.
      5This is not our first occasion to interpret Maryland’s
statute of repose.   In Pippin v. Reilly Industries, Inc., for
example, we applied the statute to bar wrongful death claims
against a utility pole designer stemming from the decedent’s
collision with a utility pole.    See 64 F. App’x 382, 386 (4th
Cir. 2003) (per curiam).    We reasoned, because the wires and
transformers had to sit in a safe position, “the pole was
integral to provision of electricity.” Id. We also noted that
although the company could have used other means to achieve this
end, the pole was nonetheless an “ordinary and reasonable means”
of doing so. Id.; see also Lewis v. Weldotron Corp., 5 F. App’x
265, 268–69 (4th Cir. 2001) (barring claims stemming from shrink
wrap system in brick manufacturing plant that required labor and
capital for installation, enhanced value and utility of
(Continued)
                                   9
             Here, like the district court, we are satisfied that

Appellee’s use of COPR to expand and develop the Dundalk Marine

Terminal is -- if not an improvement to real property standing

alone -- at least an integral component of the project.                         See

Hickman, 784 A.2d at 38.

             Appellants    argue    against     this     conclusion,       stating,

“Honeywell’s toxic dumping made the area unsuitable for human

use   and   development    because      it   posed   a   tremendous    and    known

threat to human health and the environment.”                Appellants’ Br. 13

(emphasis in original).          But neither the statute’s text nor its

legislative history support this theory as grounds for rendering

the statute inapplicable.          The language of the statute does not

except      hazardous     conditions,        much    less     known    hazardous

conditions.     Indeed, such an exception would swallow the rule,

which    only    applies    to     an    “alleged        defective    or     unsafe

condition.”      § 5-108(a).       Moreover, in enacting the exception

for asbestos manufacturers, the Maryland legislature was quite

clear that the exception was limited to asbestos.                See Rose, 643
A.2d at 917 (“The General Assembly expressly identified certain

defendants to which subsection (a) does not apply.”).                        We are

property, and was affixed to property with gas lines and bolts
in concrete floor).

                                        10
not positioned to create an additional exception for chromium

manufacturers.

             Appellants further argue the use of COPR has decreased

the value of the land in comparison to its hypothetical value

with less hazardous fill.           See Appellants’ Br. 17.        The “common

sense” test Maryland courts derive from the statute, however,

belies this assertion.          Rose, 643 A.2d at 918.             Appellants’

allegations establish that Appellee utilized COPR fill to create

a vast 85-acre parcel and transferred the parcel to the Maryland

Port Authority, which used -- and continues to use -- the parcel

as    an   active   marine   terminal.      This   expansion    thus   bestowed

greater      utility   to    both    Appellee      and   the    Maryland    Port

Authority, see id., regardless of the wisdom of using hazardous

materials to exact the expansion.

             Indeed, viewing the expansion as a whole rather than

the COPR fill “in isolation,” the record establishes that the

fill was, in fact, an “integral component” to developing the

parcel for its use as the Marine Terminal.               Hickman, 784 A.2d at

38.     Appellants’ reliance on Hickman is unavailing; there, the

defendant’s     burial   site   removal     was    not   only   “unlawful   and

prohibited” but also “not necessary” to develop the land.                    Id.

at 38–39.      Here, however, Appellee could not have developed the

parcel into the Marine Terminal without a surface on which to

build.      The crucial difference between these cases thus lies in

                                       11
the purpose of the alleged improvement, not its alleged legal

status.   To hold otherwise would render the statute inapplicable

merely if a plaintiff could concoct an allegation of illegality,

as Appellants have done here.   See, e.g., Appellants’ Reply Br.

7–9.

          The agreement between Appellee and the Port Authority

shows the crucial roles -- both functional and financial -- the

COPR fill played in expanding the Marine Terminal.   Indeed, the

agreement deemed the 85-acre parcel “required” for the “purpose

of expanding the Dundalk Marine Terminal.”   J.A. 221.   Moreover,

the agreement entitled the Port Authority to payment if Appellee

failed to deposit COPR fill at the Marine Terminal, see id. at

223, indicating the financial significance of the fill to the

Port Authority.

          Appellee’s use of COPR fill in creating the landmass

that later became the base for a large portion of the Dundalk

Marine Terminal is thus an improvement to that property pursuant

to Maryland’s statute of repose.      Because Appellants concede

that they brought their claims outside of the statute’s 20-year

time bar, the district court did not err in dismissing these

claims.

                                12
                                  IV.

          For   the   foregoing   reasons,   we   affirm   the   district

court’s dismissal.

                                                                 AFFIRMED

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