Court Opinion

ID: 9939809
Source: CourtListenerOpinion
Date Created: 2024-02-12 20:02:37.473493+00
Date Added: 2024-06-11T13:41:59.547105
License: Public Domain

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

STATE OF DELAWARE, ex rel.        )
KATHLEEN JENNINGS, Attorney       )
General of the State of Delaware  )
                                  )
      Plaintiff,                  )C.A. No. N20C-09-097 MMJ CCLD
                                  )
BP AMERICA., BP P.L.C., CHEVRON   )
CORPORATION, CHEVRON U.S.A. INC., )
CONOCOPHILLIPS, CONOCOPHILLIPS )
COMPANY, PHILLIPS 66, PHILLIPS 66 )
COMPANY, EXXON MOBIL              )
CORPORATION EXXONMOBIL OIL        )
CORPORATION, XTO ENERGY INC.,     )
HESS CORPORATION, MARATHON OIL )
CORPORATION, MARATHON OIL         )
COMPANY, MARATHON PETROLEUM )
CORPORATION, MARATHON             )
PETROLEUM COMPANY, LP             )
SPEEDWAY LLC, MURPHY OIL          )
CORPORATION, MURPHY USA INC.,     )
ROYAL DUTCH SHELL PLC, SHELL OIL )
COMPANY, CITGO PETROLEUM          )
CORPORATION, TOTAL S.A., TOTAL    )
SPECIALITIES USA INC., OCCIDENTAL )
PETROLEUM CORPORATION, DEVON )
ENERY CORPORATION, APACHE         )
CORPORATION, CNX RESOURCES        )
CORPORATION, CONSOL ENERGY        )
INC., OVINTIV, INC., and AMERICAN )
PETROLEUM INSTITUTE,              )
                                  )
      Defendants.                 )

                                   1
                                  Submitted: January 29, 2024
                                  Decided: February 12, 2024

              On CNX Resources Corporation, Citgo Petroleum Corporation
                   and Murphy USA Inc.’s Motion for Reargument
                                    DENIED

                On Consol Energy Inc.’s Joinder in Motion for Reargument
                                       DENIED

                      On Apache Corporation’s Motion for Clarification
                              and/or Limited Reconsideration
                          of the Court’s January 9, 2024 Opinion
                                         DENIED

                                              ORDER

          1. By Opinion dated January 9, 20241, the Court granted in part and denied

in part Defendants’ various Motions to Dismiss.

          2. Defendants CNX Resources Corporation, Citgo Petroleum Corporation

and Murphy USA Inc. (“CNX”); Consol Energy Inc. (“Consol”); and Apache

Corporation (“Apache”) have moved for reargument.

          3. CNX argues that the Court overlooked the arguments for dismissal of the

failure to warn claim. Specifically, the State failed to adequately allege that CNX

had “superior knowledge” or “special knowledge” that the products were likely to

be dangerous for the use for which the products were supplied. CNX asserts that

Rule 9(b)’s heightened pleading standard applies to the State’s failure to warn claim.

1
    State ex rel. Jennings v. BP America Inc., et al., 2024 WL 98888 (Del. Super.).

                                                  2
      4. Consol also argues that the State failed to allege this it had “special

knowledge” that its use of products would likely contribute to climate change.

      5. Apache argues that the State did not plead that Apache specifically knew

that its products were endangering the environment or harming consumers. The

State did not allege that Apache “researched the effects of fossil fuel consumption

or that Apache participated in any discussions regarding the same.” Thus, Apache

asserts that there can be no inference of its knowledge. Additionally, Apache

contends that the State has failed to allege that “any of Apache’s production made

its way to Delaware nor has it pleaded any specific sales or marketing efforts to

consumers...in the State of Delaware.”

      6. As to CNX, the State responds that under Rule 9(b), while negligence must

be pled with particularity, “knowledge and other condition of mind...may be averred

generally.” The Rule 9(b) particularity requirement regarding state of mind applies

to fraud claims. Further, the arguments about “special” or “superior” knowledge

were exhaustively briefed.

      7. As to Consol, the State’s response is the same.

      8. As to Apache, the State additionally responds that the State alleged that

each Defendant knew or had reasons to know that their fossil fuel products were

causing harm to their consumers and to the State. The State also alleged that Apache

                                         3
made statements in and outside Delaware regarding their campaign of deception and

thus failed to warn consumers.

          9. It the January 9, 2024 Opinion, the Court found, in part:

                                       Failure to Warn
                        The State argues that Defendants failed to warn by
                 making misrepresentations about climate change and
                 attempting to indirectly induce Delaware consumers to
                 buy their fossil fuel products.2 Defendants “had a duty to
                 warn both consumers and bystanders that would
                 foreseeably be harmed by the intended use of their
                 products, and because [Defendants] made sure the dangers
                 of their products were neither open nor obvious through
                 their pervasive climate-disinformation campaigns.”3
                 Under Section 388 of the Restatement (Second) of Torts
                 and Delaware law, a manufacturer has a duty to warn users
                 of the dangerous nature of its products.

                        One who supplies directly or through a third person
                 a chattel for another to use is subject to liability to those
                 whom the supplier should expect to use the chattel with
                 the consent of the other or to be endangered by its probable
                 use, for physical harm caused by the use of the chattel in
                 the manner for which and by a person for whose use it is
                 supplied, if the supplier

                 (a) knows or has reason to know that the chattel is or is
                 likely to be dangerous for the use for which it is supplied,
                 and

                 (b) has no reason to believe that those for whose use the
                 chattel is supplied will realize its dangerous condition, and

2
 Pl.’s Answering Brief in Opposition to Defs. Joint Motion to Dismiss for Failure to State a
Claim at 53.
3
    Id. at 39.
                                                4
                 (c) fails to exercise reasonable care to inform them of
                 its dangerous condition or of the facts which make it likely
                 to be dangerous.
                         This duty extends not only to those for whose use
                 the chattel is supplied but also to third parsons whom the
                 supplier should expect to be endangered by its use, which
                 may include persons who have no connection with the
                 ownership or use of the chattel itself. The manufacturer’s
                 duty is dependent on whether it had knowledge of the
                 hazards associated with its product. The standard for
                 determining the duty of a manufacturer to warn is that
                 which a reasonable (or reasonably prudent) person
                 engaged in that activity would have done, taking into
                 consideration the pertinent circumstances at that time. And
                 even where that knowledge exists, liability is imposed
                 only where the manufacturer had no reason to think that
                 the users of its products would recognize the danger, and
                 it fails to exercise reasonable care in warning users of the
                 product’s dangerous nature.4

                        The State argues that Defendants had a duty to warn
                 because they knew or had reason to know that their fossil
                 fuel products were causing harm to their consumers and to
                 the State.5 The State also argues that it is an injured
                 bystander. Foreseeable bystanders need to be protected as
                 well.6 Courts have recognized that “bystanders should be
                 entitled to greater protection than the consumer or user

4
 Ramsey v. Georgia S. Univ. Advanced Dev. Ctr., 189 A.3d 1255, 1278–1279 (Del. 2018) (citing
Restatement § 388) (quotes omitted).
5
 Pl.’s Answering Brief in Opposition to Defs. Joint Motion to Dismiss for Failure to State a
Claim at 42.
6
    Id. at 40.

                                                5
                     where injury to bystanders from the defect is reasonably
                     foreseeable.”7

                            In response, Defendants argue that there is “no duty
                     to warn of or protect invitees from an open and obvious
                     danger.”8 Defendants allege that the State’s own
                     allegations in the Complaint admit that the potential
                     dangers of fossil fuel use on the climate have been “open
                     and obvious” for decades.9 Thus, Defendants had no duty
                     to warn about these dangers, and the negligent failure to
                     warn claims fail as a matter of law.10

                            The Court finds that the State has stated a claim for
                     failure to warn. The State has alleged that Defendants
                     knew that their products were endangering the
                     environment, and harming their consumers and the State
                     of Delaware (a valid bystander). However, the question of
                     whether the danger was open and obvious is not
                     appropriate for resolution at the dismissal stage.

          10. The purpose of moving for reargument is to seek reconsideration of

findings of fact, conclusions of law, or judgment of law.11 Reargument usually will

be denied unless the moving party demonstrates that the Court overlooked a

precedent or legal principle that would have a controlling effect, or that it has

7
    Elmore v. Am. Motors Corp., 70 Cal. 2d 578, 586 (1969); see also Prosser & Keeton on Torts §

100, pp. 703–704 (5th ed. 1984).
8
  Defs. Joint Opening Brief in Support of Motion to Dismiss for Failure to State a Claim at 56
(quoting Jones v. Clyde Spinelli, LLC, 2016 WL 3752409, at *2 (Del. Super.)).
9
    Id. at 57.
10
     Id. at 57–58.
11
     Hessler, Inc. v. Farrell, 260 A.2d 701, 702 (Del. 1969).
                                                   6
misapprehended the law or the facts in a manner affecting the outcome of the

decision.12 “A motion for reargument should not be used merely to rehash the

arguments already decided by the court.”13 To the extent moving Defendants have

asserted issues that were not raised in the submissions in support of its motion, new

arguments may not be presented for the first time in a motion for reargument.14 A

court cannot “re-weigh” evidence on a motion for reargument.15

          11. The Court has reviewed and considered the parties’ written submissions

and arguments.         The Court did not overlook a controlling precedent or legal

principle, or misapprehend the law or the facts in a manner affecting the outcome of

the decision. Rule 9(b) does not require that the State specifically allege “special”

or “superior” knowledge by each individual Defendant in support of its failure to

warn claim. Knowledge and state of mind may be averred generally. For purposes

of a motion to dismiss, a plaintiff asserting failure to warn need not plead specific

sales or marketing efforts to consumers in Delaware. It is sufficient to survive a

motion to dismiss that the State alleged that each Defendant knew or had reasons to

know that their fossil fuel products were causing harm to their consumers and to the

12
     Ferguson v. Vakili, 2005 WL 628026, at *1 (Del. Super.).
13
     Wilmington Trust Co. v. Nix, 2002 WL 356371, at *1 (Del. Super.).
14
     Oliver v. Boston University, 2006 WL 4782232, at *1 (Del. Ch.).
15
     Manichean Capital, LLC v. Sourcehov Holdings, Inc., 2020 WL 11660067, at *3 (Del. Ch.).
                                                 7
State, and that Apache made statements in and outside Delaware regarding their

campaign of deception and thus failed to warn consumers.

      THEREFORE, Defendants’ Motions for Reargument are hereby DENIED.

      IT IS SO ORDERED.

                                   /s/ Mary M. Johnston
                              The Honorable Mary M. Johnston

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