Court Opinion

ID: 4644591
Source: CourtListenerOpinion
Date Created: 2020-12-18 15:08:51.764455+00
Date Added: 2024-06-11T08:00:46.609359
License: Public Domain

RENDERED: DECEMBER 11, 2020; 10:00 A.M.
                        NOT TO BE PUBLISHED

                  Commonwealth of Kentucky
                            Court of Appeals

                               NO. 2020-CA-0137-ME

KATHY LITTLE; DEBRA WALKER;
GREG WALKER; AND RICHARD
EVANS, INDIVIDUALLY AND
ON BEHALF OF ALL OTHERS
SIMILARLY SITUATED                                                      APPELLANTS

                  APPEAL FROM JEFFERSON CIRCUIT COURT
v.                 HONORABLE MITCHELL PERRY, JUDGE
                          ACTION NO. 17-CI-003023

LOUISVILLE GAS AND ELECTRIC
COMPANY                                                                     APPELLEE

                                      OPINION
                                     AFFIRMING

                                    ** ** ** ** **

BEFORE: ACREE, KRAMER, AND TAYLOR, JUDGES.

TAYLOR, JUDGE: Kathy Little, Debra Walker, Greg Walker, and Richard Evans,

individually and on behalf of all others similarly situated, bring this appeal from a

January 8, 2020, Opinion and Order of the Jefferson Circuit Court denying
certification of a class action against Louisville Gas and Electric Company (LG&E).

We affirm.

                 On June 15, 2017, Little, Evans, and the Walkers filed a class action

complaint against LG&E in the Jefferson Circuit Court. In the complaint, it was

alleged that LG&E operated a coal-fired power plant, known as the Cane Run Plant,

in Jefferson County, Kentucky.1 The Cane Run Plant was located adjacent to a

residential area, where Little, Evans, and the Walkers resided. According to the

complaint, the Cane Run Plant emitted coal dust, fly ash, bottom ash, and other coal

combustion byproducts upon Little’s, Evans’, and the Walkers’ properties and upon a

class of homeowners located within an “Exposure Area.” The Exposure Area

consisted of 9,807 properties located up to three miles from the Cane Run Plant:

                        125. Plaintiffs bring this action pursuant to CR 23
                 of the Kentucky Rules of Civil Procedure on behalf of the
                 following Class (“Class”):

                         All current owners of residential real property
                         located in Kentucky within the Exposure Area as
                         depicted in Exhibit 1.

                 ....

                        127. Plaintiffs are members of the Class they seek
                 to represent. Because there are thousands of persons in the
                 Class, joinder of claims is impracticable. The disposition
                 of the claims asserted through this class action will be more
                 efficient and will benefit the parties and the Court.

1
    In June 2015, the power plant at Cane Run converted from coal-fire to natural gas.
                                                 -2-
         128. The Class should be certified because the
   claims asserted in this action, trespass and nuisance, are
   common to all members of the class and individual
   complaints otherwise may result in inconsistent or varying
   adjudications.

          129. Plaintiffs’ claims are typical of the claims of
   the Class, because all claims arise from the same operative
   facts and are based on the same legal theories.

          130. The Plaintiffs will fairly and adequately
   protect the interests of the Class. Plaintiffs have retained
   competent and experienced counsel in matters such as
   these. Plaintiffs and their counsel are committed to
   prosecuting this action vigorously on behalf of the Class
   and have the financial resources to do so. Neither Plaintiffs
   nor their counsel have interests adverse to those of the
   Class.

          131. There are questions of law or fact common to
   the Class that predominate over any questions affecting
   only individual Class members. Some of these common
   questions of law or fact common to the Class include, but
   are not limited to:

a. Whether coal ash or other particulates were deposited on
   Class members’ properties;

b. Whether during the course of operating the Cane Run Site
   as a coal-fired power plant Defendant LG&E emitted coal
   ash or other particulates;

c. Whether the coal ash and other particulates that were
   deposited on Class members’ properties emanated from the
   Cane Run Site;

d. Whether the measures Defendant LG&E implemented at
   Cane Run to prevent the release of its emissions on
   surrounding neighborhoods were effective and sufficient;
                               -3-
        e. Whether Defendant LG&E breached a duty of reasonable
           care and/or statutory and regulatory duties in the operation
           of the Cane Run Site by allowing coal-related particulates
           to be deposited on Class members’ properties;

        f. Whether Defendant LG&E committed gross negligence, or
           acted with willful, wanton, or careless disregard by
           allowing coal-related particulates to emanate from its
           property, knowing that the coal-related particulates were
           likely to reach Class members’ properties;

        g. Whether Defendant LG&E trespassed on Class members’
           properties intentionally or negligently;

        h. Whether Defendant LG&E created a nuisance with respect
           to Class members’ properties by unreasonably interfering
           with their use and enjoyment of their respective properties;
           and

        i. The damages to which Class Members are entitled.

                   132. A class action is superior to other available
            methods for the fair and efficient adjudication of the
            controversy. The expense and burden of litigation would
            substantially impair the ability of many Class members to
            pursue individual cases to protect their rights. Absent
            class treatment, Plaintiffs and the Class members will
            continue to suffer harm and damage to their respective
            properties as a result of Defendant’s unlawful and
            wrongful conduct.

Complaint at 37-39. In particular, it was claimed that between 2008 and 2015, coal

dust, coal ash, and other combustion byproducts were deposited upon the named

plaintiffs’ and class members’ homes, vehicles, and yards, thereby causing their

properties to be contaminated with toxic materials:

                                       -4-
     85. Arsenic and other toxic metals including
chromium and lead that are contained in fly ash, bottom ash,
and the other coal combustion byproducts generated, handled,
stored, transported, and disposed of at the Cane Run Site are
known human carcinogens and pose other significant risks to
human health.

      86. Fly ash and bottom ash also contain significant
amounts of silica, which is a known cause of the lung disease,
silicosis, and lung cancer.

      87. The dangers of inhaling coal dust have been
known for decades, given the extensive studies of coal dust’s
effects on coal miners. Coal dust has been linked to lung
disorders, including progressive massive fibrosis, chronic
bronchitis, lung function loss, and emphysema.

      88. A study by Duke University, in the aftermath of
the coal ash spill at the Tennessee Valley Authority’s Kingston
plant in December 2008, concluded that one of the prime
dangers of the spill was the “wind-blown re-suspension of fly
ash into the atmosphere.”

      89. As a result of their toxic metal and silica content,
among other substances, standard Material Safety Data Sheets
indicate that both fly ash and bottom ash are designated as
carcinogenic substances that require extensive handling
precautions.

       90. Cancer and silicosis are not the only dangers
presented by the coal dust and coal combustion particulates
released by the Cane Run Site, as both fly ash and bottom ash
are eye, skin, and lung irritants.

      91. With respect to the lungs, the dangers posed by fly
ash extend beyond mere irritation. As detailed in the medical

                          -5-
               literature, fly ash contains particles that are sufficiently fine to
               be trapped deep in the lungs, where they can damage the lung
               lining, cause inflammation, inhibit immune response, and
               increase the risk of cardiopulmonary disease.

                     92. With respect to the eyes, contact with fly ash and
               bottom ash can cause severe mechanical irritation, such that
               material safety data sheets generally recommend that those
               exposed to these ashes wear dust-proof safety goggles.

                       93. Plaintiffs and other residents of the areas
               surrounding the Cane Run Site, including the Exposure Area,
               have complained to Defendant LG&E, as well as to county,
               state, and federal officials, regarding health problems
               stemming from exposure to coal dust and coal ash particulates
               released from the Cane Run Site. The health problems
               complained of include respiratory ailments, severe eye
               irritation, sensitivity to strong sulfur odors, and elevated cancer
               rates. Residents have voiced their complaints to, among
               others, Defendant LG&E, the APCD, the Kentucky
               Department for Environmental Protection, the EPA, and
               elected representatives.

Complaint at 30-32 (footnotes omitted). In the complaint, the causes of action

alleged against LG&E were temporary nuisance, trespass, gross negligence, and

willful or wanton misconduct. It must be pointed out that only property damages

were sought:

                    133. The following categories of monetary
               damages sought are common to Plaintiffs and Class
               members:

          a. Monetary damages reflecting the cost to remediate
             Plaintiffs’ and Class members’ properties of the
             contamination caused by Defendant’s conduct;

                                           -6-
         b. Monetary damages to compensate Plaintiffs and Class
            members for the loss of the use and enjoyment of their
            properties caused by Defendant’s conduct; and

         c. any other measures of property damages permitted by
            Kentucky law.

Complaint at 39. And, the main components of property damage were costs of

removing the toxic contamination from the homes of the class members.

             LG&E filed an answer. Thereafter, Little, Evans, and the Walkers

filed a motion to certify the class action, and LG&E filed a response opposing

same. The circuit court conducted a hearing, and by Opinion and Order entered

January 8, 2020, the circuit court denied the motion to certify the class action. The

court concluded that the requirements of Kentucky Rules of Civil Procedure (CR)

23.01(d) and of CR 23.02 were not satisfied and reasoned:

             D. Adequacy

                    The fourth and final element of class certification,
             adequacy, requires that “The representative parties will
             fairly and adequately protect the interests of the class.”
             CR 23.01(d). “The adequacy inquiry under [CR
             23.01(d)] serves to uncover conflicts of interest between
             named parties and the class they seek to represent.”
             Amchem Products, Inc. v. Windsor, 521 U.S. 591, 625
             (1997). In practice, “[A] class representative must be
             part of the class and ‘possess the same interest and suffer
             the same injury’ as the class members.” Id. (citing East
             Tex. Motor Freight System, Inc. v. Rodriguez, 431 U.S.
395, 403 (1977)). Additionally, “The adequacy

                                         -7-
evaluation also takes into consideration the competency
and conflicts of class counsel.” Burkhead v. Louisville
Gas & Elec. Co., 250 F.R.D. 287, 296 (W.D. Ky. 2008).

       In Burkhead, the Court questioned the adequacy of
plaintiffs’ class representatives because they voluntarily
disavowed their personal injury claims while pursuing
only property damage claims. Id. This led to the issue of
res judicata and the possibility of precluding absent class
members from later asserting such claims. See id. (citing
Yeoman v. Commonwealth Health Policy Bd., 983
S.W.2d 459, 465 (Ky. 1998). The Burkhead Court
explained that some federal courts have found that
splitting claims creates an inability for the class
representatives to adequately represent the best interests
of absent class members. Id. Therefore, the Court
rejected plaintiff’s adequacy argument by questioning
whether “‘the interests of the class members will be fairly
and adequately protected in their absence.’” Id. (quoting
Amchem Products, Inc. v. Windsor, 521 U.S. at 626 n.
20).

       As stated in Burkhead, numerous other federal
courts have also found that named plaintiffs fail to
adequately represent class members when claims are split
or disavowed completely. See Martin v. Home Depot
US.A., Inc., 225 F.R.D. 198, 204 (W.D. Tex. 2004)
(rejecting adequacy of representation because “Upon a
final judgment, unasserted property and personal injury
damages will be forever barred by operation of res
judicata-for all class members”); Ardoin v. Stine Lumber
Co., 220 F.R.D. 459, 466 (W.D. La. 2004) (holding that
named plaintiffs provided inadequate representation after
disavowing personal injury claims because “the doctrine
of res judicata would forever bar the personal injury
claims of those who allege that they are injured . . .
subjecting them, instead, to the limited damages allowed
under the present cause of action”); in re MTBE, 209
F.R.D. 323, 340 (S.D.N.Y. 2002) (holding that

                            -8-
representatives were inadequate when disavowing
personal injury claims reasoning that “When viewed
against the risk that subsequent courts would preclude
absent class members from bringing personal injury
claims, the named plaintiffs’ relatively weak incentive to
prosecute this case leads to the inescapable conclusion
that the class representatives are inadequate”).

       Here, Plaintiffs have similarly disavowed all
personal injury claims and opted to seek only property
damage claims. Defendants argue that, similar to
Burkhead and the cases above, this raises issues of res
judicata for absent class members and prevents the
Named Plaintiffs from adequately representing the
interests of the class. Defendants Response to Plaintiffs
Motion to Certify the Class at 26-28. Plaintiffs have
provided no alternative options to satisfy the potential
inadequacies of their proposed class. Rather, they simply
state that the Burkhead court was likely incorrect and that
leading federal authorities and federal courts of appeal
conclude that claim splitting does not bar subsequent
actions by absent class members asserting claims that
were not certified. Plaintiffs’ Reply in Support of Motion
to Certify the Class at 32.

       The Court agrees with Defendants. At the very
least the res judicata issue “raises questions that ‘the
interests of the class members will be fairly and
adequately protected in their absence.’” Burkhead, 250
F.R.D. at 297 (quoting Amchem, 521 U.S. at 626 n. 20).
Plaintiffs may be correct that some federal authority
supports their position. However, a seemingly equal
amount of authority also conflicts with their position,
including Burkhead, a federal district court within this
very jurisdiction. Here, as in many of the cases cited
above, there are questions “as to whether the named
plaintiff’s stake in this action is substantial enough,
relative to class members who suffered personal injuries,
to prosecute this action vigorously on behalf of absent

                            -9-
class members.” In re MTBE, 209 F.R.D. 323, 340
(S.D.N.Y. 2002).

       There is no dispute that Plaintiffs are represented
by adequate and capable counsel. However, the decision
to disavow personal injury claims creates possible res
judicata issues that put into question the adequacy of
representation. Numerous federal courts have held that
adequacy is not met when claims are split, and personal
injury claims are disavowed. Therefore, Plaintiffs have
failed to prove adequacy of representation required by
CR 23.01(d).

III. Requirements of CR 23.02

       In addition to the four requirements in CR 23.01, a
potential class must fulfill one of the prerequisites found
in CR 23.02. Here, Plaintiffs have requested certification
pursuant to CR 23.02(c). Under CR 23.02(c),
certification is proper because “questions of law or fact
common to the members of the class predominate over
any questions affecting only individual members, and [] a
class action is superior to other available methods for the
fair and efficient adjudication of the controversy.” CR
23.02(c). Even if Named Plaintiffs would have
adequately represented the class under CR 23.01(d),
Plaintiffs have failed to satisfy the requirements of CR
23.02(c).

       Under CR 23.02(c), a “class must satisfy a two-
part test of predominance and superiority.” Id at 116.
The predominance inquiry test determines “whether
proposed classes are sufficiently cohesive to warrant
adjudication by representation.” Amchem Prod., Inc. v.
Windsor, 521 U.S. at 623. The predominance criterion of
CR 23.02(c) is far more demanding than the
commonality requirement of 23.01(b). Manning, 577
S.W.3d at 118; See also O’Sullivan v. Countrywide Home
Loans, Inc., 319 F.3d 732, 738 (5th Cir. 2003);

                           -10-
Anchem,[sic] 521 U.S. at 624. For instance, the inquiry
entails “identifying the substantive issues that will
control the outcome, assessing which issues will
predominate, and then determining whether the issues are
common to the class.” O’Sullivan, 319 F.3d at 738 (5th
Cir. 2003). In sum, “the question is whether common
factual and legal questions predominate, that is, whether
any individualized questions relate solely to the amount
of damages potentially owed to each class member.”
Burkhead v. Louisville Gas & Elec. Co., 250 F.R.D. 287,
299 (W.D. Ky. 2008).

       In Burkhead, the Court ruled that plaintiffs failed to
satisfy CR 23.02(c). Id. The Court reasoned that
“Plaintiffs have alleged that Defendant’s operations
result in extensive emissions, but what remains missing is
any evidence that the cause of the entire class’s damages
could be determined in a single proceeding.” Id.
Therefore, the Court was unconvinced that Defendant’s
liability to the class would be a common question or that
a class action would be a superior method for
adjudicating plaintiff’s claims. Id. at 300.

       Similarly, the Court in Manning held that plaintiffs
failed to meet the requirements of CR 23.02. The Court
explained that “While there are undoubtedly common
issues of law and fact in this case, there are also
numerous questions that must be answered on an
individualized basis relating to causation, impact, and
damages.” Manning, 577 S.W.3d at 117. The Court
carefully reiterated that “a need for individual damages
determinations is not necessarily fatal to class
certification.” Id.

       Here, like the Courts in both Manning and
Burkhead, this Court holds that Plaintiffs have failed to
satisfy the requirements of CR 23.02. Importantly, there
was no singular event causing the pollution, rather the
alleged emissions occurred over a period of many years.

                            -11-
             While this fact is not dispositive by itself, there are
             simply too many questions to be answered on an
             individualized basis relating to causation, impact, and
             damages. For instance, in order to prove intentional
             trespass, Plaintiffs must prove “An intrusion (or
             encroachment) which is an unreasonable interference
             with the property owner’s possessory use of his/her
             property.” Smith v. Carbide & Chemicals Corp., 226
S.W.3d 52, 57 (Ky. 2007). The evidence provided by
             Plaintiffs is insufficient to prove that Defendants conduct
             caused “an unreasonable interference with the property
             owner’s possessory use of his/her property” for all 9,807
             residential properties. This rationale applies equally to
             Plaintiffs’ other claims as well. In sum, adjudicating
             such a large-scale fact-finding mission would be nearly
             impossible. Although Plaintiffs have satisfied the
             commonality requirements in CR 23.01(b), this Court
             concludes that Plaintiffs have failed to satisfy the more
             stringent requirements of 23.02(c).

Opinion and Order at 8-11. This appeal follows.

             Appellants contend that the circuit court erroneously denied their

motion to certify the class action against LG&E. Specifically, appellants argue

that the circuit court erred by concluding that the adequacy requirement set forth in

CR 23.01(d) was not satisfied. Appellants maintain that any potential personal

injury claims arising from exposure to toxic materials emitted by Cane Run Plant

are purely speculative, hypothetical, and barred by the statute of limitations.

Appellants also claim that the claim-splitting defense is inapplicable because “a

court presiding over a class action lacks the ability to provide relief for absent class

members’ uncertified claims.” Appellants’ Brief at 11.

                                         -12-
            To maintain a class action in Kentucky, the requirements of both CR

23.01 and CR 23.02 must be satisfied. Hensley v. Haynes Trucking, LLC, 549
S.W.3d 430, 442 (Ky. 2018). CR 23.01 provides:

            Subject to the provisions of Rule 23.02, one or more
            members of a class may sue or be sued as representative
            parties on behalf of all only if (a) the class is so
            numerous that joinder of all members is impracticable,
            (b) there are questions of law or fact common to the
            class, (c) the claims or defenses of the representative
            parties are typical of the claims or defenses of the class,
            and (d) the representative parties will fairly and
            adequately protect the interests of the class.

And, CR 23.02 provides:

            An action may be maintained as a class action if the
            prerequisites of Rule 23.01 are satisfied, and in addition:

            (a) The prosecution of separate actions by or against
            individual members of the class would create a risk of

            (i) inconsistent or varying adjudications with respect to
            individual members of the class which would establish
            incompatible standards of conduct for the party opposing
            the class, or,

            (ii) adjudications with respect to individual members of
            the class which would as a practical matter be dispositive
            of the interests of the other members not parties to the
            adjudications or substantially impair or impede their
            ability to protect their interests; or

            (b) the party opposing the class has acted or refused to
            act on grounds generally applicable to the class, thereby
            making appropriate final injunctive relief or

                                        -13-
             corresponding declaratory relief with respect to the class
             as a whole; or

             (c) the court finds that the questions of law or fact
             common to the members of the class predominate over
             any questions affecting only individual members, and
             that a class action is superior to other available methods
             for the fair and efficient adjudication of the controversy.
             The matters pertinent to the findings include: (i) the
             interest of members of the class in individually
             controlling the prosecution or defense of separate actions;
             (ii) the extent and nature of any litigation concerning the
             controversy already commenced by or against members
             of the class; (iii) the desirability or undesirability of
             concentrating the litigation of the claims in the particular
             forum; (iv) the difficulties likely to be encountered in the
             management of a class action.

The four prerequisites set out in CR 23.01 to maintain a class action are generally

referred to as “numerosity, commonality, typicality, and adequacy of

representation[.]” Hensley, 549 S.W.3d at 442-43. If all four prerequisites of CR

23.01 are satisfied, CR 23.02 mandates that the proposed class must then satisfy

one of its three requirements.

             Our standard of review of the circuit court’s decision to certify or not

to certify a class action is for an abuse of discretion. Hensley, 549 S.W.3d at 444.

It has been recognized that “[i]mplicit in this differential standard . . . of the

certification inquiry [is] the [circuit] court’s inherent power to manage and control

pending litigation.” Id. at 444 (quoting Allison v. Citgo Petroleum Corp., 151 F.3d
402, 408 (5th Cir. 1998)). To that end, “[a]s long as the [circuit] court’s reasoning

                                          -14-
stays within the parameters of [CR] 23’s requirement for certification of a class,

the [circuit court’s] decision will not be disturbed” on appeal. Hensley, 549
S.W.3d at 444 (quoting Hines v. Widnall, 334 F.3d 1253, 1255 (11th Cir. 2003)).

             To begin our analysis, we will address the fourth prerequisite of CR

23.01, adequacy of representation. Under the adequacy of representation

prerequisite, “the representative parties [must] fairly and adequately protect the

interests of the class.” CR 23.01(d). To satisfy the adequacy of representation

prerequisite, it must be demonstrated that “1) the representative . . . [has] common

interests with unnamed members of the class; and 2) it . . . appear[s] that the

representatives will vigorously prosecute the interests of the class through qualified

counsel.” Nebraska Alliance Realty Co. v. Brewer, 529 S.W.3d 307, 313 (Ky.

App. 2017) (quoting Senter v. General Motors Corp., 532 F.2d 511, 525 (6th Cir.

1976)).

             The circuit court’s thorough analysis determined appellants did not

adequately represent the interests of all proposed class members. As a basis

therefore, the circuit court pointed to the decision of appellants not to pursue any

personal injury claims of class members against LG&E. The circuit court was

troubled by the res judicata implications, including the potential of precluding

absent class members from later pursuing personal injury claims against LG&E.

                                         -15-
             Despite appellants’ allegations to the contrary, the absent class

members’ possible personal injury claims are neither speculative nor hypothetical.

In the complaint, appellants repeatedly claimed that the fly ash, bottom ash, and

other combustion byproducts were toxic, with some constituents thereof being

classified as carcinogenic. According to the complaint, arsenic, chromium, and

silica were contained within the fly ash, bottom ash, and other byproducts emitted

from the Cane Run Plant. Appellants further asserted that arsenic, chromium, and

silica can cause lung cancer, silicosis, progressive massive fibrosis, chronic

bronchitis, lunch function loss, emphysema, and severe eye irritation. Complaint

at 30-32. In fact, the property damages claimed by appellants are based upon the

toxicity of the fly ash, bottom ash, and other combustion byproducts emitted by the

Cane Run Plant that settled upon each class member’s property.

             As to the class action, the principals of res judicata are applicable, and

the doctrine of claim preclusion would bar a party from relitigating any claim that

was or could have been raised in the previous action. Floyd Cty. Bd. of Educ. v.

Layne, 474 S.W.2d 397, 399 (Ky. 1971); Miller v. Admin. Office of Courts, 361
S.W.3d 867, 873 (Ky. 2011). As no personal injury claims were raised in the

complaint by appellants, the circuit court believed that issues concerning res

judicata raised grave concerns as to whether the named plaintiffs could fairly and

adequately protect interests of the proposed class members. In the end, the circuit

                                         -16-
court determined that the named plaintiffs could not adequately represent the

interests of the proposed class and that the adequacy requirement of CR 23.01(d)

was not satisfied. We agree. Considering the particular facts alleged in the

complaint and the interdependency between the class members’ property claims

and potential personal injury claims, we are simply unable to conclude the circuit

court’s reasoning strayed from the parameters of the requirement for class

certification per CR 23.01(d). See Hensley, 549 S.W.3d at 444. As appellants

failed to satisfy CR 23.01(d), we are of the opinion the circuit court properly

denied class certification.

             Given appellants have failed to qualify for class certification under

CR 23.01, we view any remaining contentions of error to be moot or without merit.

             For the foregoing reasons, the Opinion and Order of the Jefferson

Circuit Court is affirmed.

             ALL CONCUR.

 BRIEFS FOR APPELLANTS:                    BRIEF FOR APPELLEE:

 Justin A. Sanders                         J. Gregory Cornett
 Covington, Kentucky                       Travis A. Crump
                                           Louisville, Kentucky
 Tad Thomas
 Louisville, Kentucky                      Sheryl G. Snyder
                                           Theresa A. Canady
 Steve W. Berman                           Jason P. Renzelmann
 Barbara Mahoney                           Louisville, Kentucky
 Seattle, Washington

                                        -17-
-18-