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Henry v. Dow Chemical Co.

Court of Appeals of Michigan

June 1, 2017

GARY HENRY and KATHY HENRY, Plaintiffs-Appellees,
v.
DOW CHEMICAL COMPANY, Defendant-Appellant.

         Saginaw Circuit Court LC No. 03-047775-NZ

          Before: Gadola, P.J., and Jansen and Saad, JJ.

          Jansen, J.

         Defendant appeals by leave granted a July 17, 2015 order denying its motion for summary disposition pursuant to MCR 2.116(C)(7) and (C)(8). For the reasons that follow, we affirm.

         I. FACTS AND PROCEDURAL HISTORY

         This case involves allegations of negligence and nuisance brought by plaintiffs, who are owners of property downstream of defendant's Midland, Michigan operation on the Tittabawassee River flood plain. Plaintiffs claim that they have suffered loss of the free use and enjoyment of their property, as well as damages in the form of decreased property value, as a result of dioxin contamination recently discovered in the flood plain soil and connected to defendant's activities.

         This case has an extensive appellate history. The Michigan Supreme Court first considered issues related to the present appeal in Henry v Dow Chem Co, 473 Mich. 63; 701 N.W.2d 684 (2005) (Henry I), describing the basic facts and procedural history as follows:

Defendant, The Dow Chemical Company, has maintained a plant on the banks of the Tittabawassee River in Midland, Michigan, for over a century. The plant has produced a host of products, including, to name only a few, "styrene, butadiene, picric acid, mustard gas, Saran Wrap, Styrofoam, Agent Orange, and various pesticides including Chlorpyrifos, Dursban and 2, 4, 5-trichlorophenol."
According to plaintiffs and published reports from the [Michigan Department of Environmental Quality (MDEQ)], defendant's operations in Midland have had a deleterious effect on the local environment. In 2000, General Motors Corporation was testing soil samples in an area near the Tittabawassee River and the Saginaw River when it discovered the presence of dioxin, a hazardous chemical believed to cause a variety of health problems such as cancer, liver disease, and birth defects. By spring 2001, the MDEQ had confirmed the presence of dioxin in the soil of the Tittabawassee flood plain. Further investigation by the MDEQ indicated that defendant's Midland plant was the likely source of the dioxin.
In March 2003, plaintiffs moved for certification of two classes in the Saginaw Circuit Court. The first class was composed of individuals who owned property in the flood plain of the Tittabawassee River and who alleged that their properties had declined in value because of the dioxin contamination. The second group consisted of individuals who have resided in the Tittabawassee flood plain area at some point since 1984 and who seek a court-supervised program of medical monitoring for the possible negative health effects of dioxin discharged from Dow's Midland plant. This latter class consists of 173 plaintiffs and, by defendant's estimation, "thousands" of putative members. [Henry I, 473 Mich. at 69-70 (citations omitted).]

         Defendant immediately moved for summary disposition of plaintiffs' medical monitoring claims, which involved requests for class certification and creation of a program, funded by defendant, to monitor the class members for future manifestations of dioxin-related disease, pursuant to MCR 2.116(C)(8). Id. at 68. After the circuit court denied defendant's motion, our Supreme Court granted defendant's emergency application for leave to appeal. Id. at 70. In Henry I, the Court considered the viability of plaintiffs' medical monitoring claims, opining that plaintiffs had raised a novel issue within the context of "toxic tort" causes of action with allegations that defendant's negligence created only the risk of disease. Id. at 67, 71-72. The Court concluded that without proof of a present, physical injury, plaintiffs did not present a viable negligence claim under Michigan's common law. Id. at 68. The Court declined to create a cause of action for medical monitoring in Michigan, explaining that drastic changes to the common law ought to be left to the Legislature. Id. at 68, 82-83, 88-89. The Court remanded the matter for entry of summary dismissal of plaintiffs' medical monitoring claim. Id. at 68.

         After Henry I, plaintiffs' remaining proposed class, which plaintiffs estimated to consist of approximately 2, 000 persons, consisted of all "persons owning real property within the 100-year flood plain of the Tittabawassee River on February 1, 2002." On remand, the circuit court dismissed plaintiffs' medical monitoring claims and certified the proposed class with respect to the remaining claims of negligence and nuisance. This Court granted defendant's application for leave to appeal the class certification. In a divided decision, we affirmed the class certification with respect to defendant's liability only. Henry v Dow Chem Co, unpublished opinion per curiam of the Court of Appeals, issued January 24, 2008 (Docket No. 266433). Defendant obtained leave to appeal to the Michigan Supreme Court. Henry v Dow Chem Co, 482 Mich. 1043; 769 N.W.2d 219 (2008). In Henry II, the Michigan Supreme Court articulated the requirements for class certification in Michigan before concluding that "the circuit court potentially used an evaluative framework that is inconsistent with this Court's interpretation of the rule and articulation of the proper analysis for class certification." Henry v Dow Chem Co, 484 Mich. 483, 500-503, 505-506; 772 N.W.2d 301 (2009). The Supreme Court remanded the matter to the circuit court for clarification. Id. at 507.

         On remand, the circuit court concluded that it had applied the appropriate standard and reaffirmed plaintiffs' class certification. The certification was short lived. After the United States Supreme Court clarified the requirements for class certification in Wal-Mart Stores, Inc v Dukes, 564 U.S. 338; 131 S.Ct. 2541; 180 L.Ed.2d 374 (2011), the circuit court revisited the certification. The circuit court found that plaintiffs had not demonstrated commonality under the standard expressed in Wal-mart Stores, and revoked plaintiffs' class action certification.

         Members of the proposed class were notified of the revocation, and on September 12, 2014, defendant filed the motion for summary disposition at the heart of the current appeal. Defendant argued that plaintiffs suffered an injury no later than 1984, when the public became aware of contamination resulting from defendant's release of potentially harmful dioxins into the Tittabawassee River, and sought dismissal of plaintiffs' claims as time-barred under MCR 2.116(C)(7). Defendant also sought summary disposition pursuant to MCR 2.116(C)(8), citing Henry I as proof that plaintiffs had not suffered a present, physical injury and noting that, without injury, plaintiffs could not make a claim in negligence or nuisance.

         The circuit court denied defendant's motion on July 17, 2015. With respect to the issue of present physical injury, the circuit court explained:

Plaintiffs allege that [defendant's] handling and disposal of dioxin has caused a long-lasting and significant contamination of Plaintiffs' property; has created a continuing nuisance which unreasonably and significantly interferes with Plaintiff's use and enjoyment of their property; has resulted in the inability of Plaintiffs to freely use their property; and has resulted in devaluation of the Plaintiff's properties. . . . Plaintiffs allege that their injury is distinct and different from that suffered by the general public because the dioxin released by [defendant] into the Tittabawassee river [sic] directly and permanently contaminated their individual private property as well as public property, has unreasonably interfered with plaintiffs' use and enjoyment of both public and private property, and has caused Plaintiffs to suffer individual financial harm in the form of decreased property values. Therefore, such allegation of present, physical injury, in addition to resulting financial damage, satisfies the pleading requirements of Michigan law for the tort of negligence.

         The circuit court also determined that plaintiffs' remaining causes of actions were not time-barred, reasoning that

[t]he type of injuries Plaintiffs allege began, at the earliest, in February of 2002, and Plaintiffs' initial action here was filed well within the three years allowed by MCL 600.5805. Plaintiffs' causes of action accrued in February of 2002 when the MDEQ's phase I sampling results were released to the public and concluded that elevated dioxin concentrations were pervasive in the Tittabawassee river floodplain. Prior to this time, Plaintiffs were free to use and enjoy their property without worry or restriction, and to sell their property without loss of value. After this time, MDEQ's dioxin-based restrictions unreasonably and significantly interfered with Plaintiffs' use and enjoyment of their property, prevented Plaintiffs from freely using their property, and devalued Plaintiffs' property.

         Defendant filed an application for leave to appeal the circuit court order with this Court on August 7, 2015. While the application was pending, plaintiffs sought leave to file a joint amended and supplemental complaint. The circuit court denied the request, instead finding that plaintiffs' claims had been misjoined. The circuit court severed the claims in plaintiffs' Third Amended Class Action Complaint, directing each plaintiff wishing to pursue a claim against defendant to raise specific allegations in an individual complaint before February 5, 2016.

         This Court denied defendant's request for leave to appeal the order denying defendant's motion for summary disposition. Henry v Dow Chemical Co, unpublished order of the Court of Appeals, entered December 17, 2015 (Docket No. 328716). Thereafter, defendant applied for leave to appeal to the Michigan Supreme Court, and, in lieu of granting leave to appeal, the Supreme Court remanded the matter for this Court's consideration as on leave granted. Henry v Dow Chemical Co, 499 Mich. 965; 880 N.W.2d 557 (2016). By the time the Supreme Court ordered the remand, 43 individual complaints had been filed in the circuit court by plaintiffs owning property in the Tittabawassee River flood plain as of February 1, 2002. Defendant has not challenged, and the ...


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