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State high court rejects class-action suit on G-P

POSTED: July 14, 2014 7:37 p.m.

State Supreme Court justices ruled Friday that a group of homeowners are not entitled to bring a class-action lawsuit against Georgia-Pacific’s Savannah River Mill.

Justices ruled 5-2, with Carol Hunstein and Robert Benham dissenting, and reversed two lower court decisions on legal action brought against the company, which some residents claimed was harming their homes through the release of hydrogen sulfide gas. The majority of justices decreed the homeowners failed to meet the requirements of qualifying as a class.

“We conclude that the trial court abused its discretion when it certified the class, and we reverse the judgment of the Court of Appeals,” Justice Keith Blackwell wrote in the majority opinion.

The original suit was brought in December 2010 by four residents, Aaron and Kirbi Ratner and David and Kathy McDonald, who claimed the release of hydrogen sulfide gas from the mill’s sludge ponds diminished the value of their property and impaired use of their property. They asked for certification as a class, in order to include 65 other property owners. The trial court ruled they met the standards for a class-action.

Georgia-Pacific appealed the ruling, claiming the lower court abused its discretion by certifying the class. The state appellate court concurred with the trial court that the class was certified properly. Georgia-Pacific then made an appeal to the state Supreme Court.

The mill has undertaken closing the sludge cells. Three of the cells the company believes are the most responsible for the pollution have been enclosed, and the mill is preparing to close in the remaining two sludge cells.

Ben Perkins, one of the attorneys epresenting the plaintiffs, said they have several options they are exploring.

“As noted by the majority and the dissent, the class as currently defined can still be certified as a class-action if we present additional evidence that the entire class has been contaminated by the mill’s hydrogen sulfide pollution,” he said. “So as the case is postured, the case will go back to the Superior Court of Effingham County for further proceedings, which can include our introduction of additional evidence and expert testimony which will satisfy the Supreme Court’s directions.”

In the opinion of a majority of the justices, the original plaintiffs failed to show there was sufficient evidence that the particular class had questions of law or fact in common.

“Because commonality is lacking, the trial court abused its discretion when it certified the class, and the Court of Appeals should have reversed the certification,” Justice Blackwell wrote.

Commonality, according to the majority decision, depends on the presence of a particular question in common, “and simply reciting a list of questions that are ‘common’ in another sense contributes nothing to the commonality inquiry.”

The plaintiffs had to show that class members had suffered the same injury and that the common contention is capable of class-wide resolution.

“We do not find in the record evidence by which the plaintiffs might be able to prove on a class-wide basis that the entire area by which the class was defined, in fact, was contaminated with hydrogen sulfide gas from the sludge fields,” stated the majority opinion. “There is, for instance, no scientific evidence of the amounts of gas released from the sludge fields, no evidence of the rate of release, no evidence of the extent to which the amounts released and rates of release varied over time, and no evidence of exactly how the gas would be expected to move through the air upon its release.”

Justice Hunstein, who authored the dissenting opinion, said the original plaintiffs did establish commonality, and the lower courts were right in their decisions to certify the class action.

“The plaintiffs have raised a number of common issues with regard to establishing Georgia-Pacific’s liability, including Georgia-Pacific’s operations at the Savannah River Mill, its waste disposal practices and its safety program,” she wrote.

They also showed the company’s liability for type and concentration of chemicals emitted from the mill and the sludge pond and how hydrogen sulfide can cause damage to health and property.

“The resolution of all of these issues will depend on the same evidence, no matter the class member,” Hunstein wrote. “The plaintiffs did not rely on mere allegations in support of their request for class certification. The plaintiffs presented the deposition testimony of Georgia-Pacific’s environmental manager, who acknowledged that hydrogen sulfide was being emitted from the sludge fields and admitted, for example, the company’s knowledge regarding the noxious odors from these emissions and the damage caused to air conditioning units on various nearby properties.”

In her dissenting opinion, Hunstein added the plaintiffs provided specific evidence of damage to air conditioning units close to the mill.

“The plaintiffs satisfied their duty to establish commonality and typicality with evidence,” Hunstein said, “as opposed to mere allegations.”

The plaintiffs argued that the border of the affected class was less than a mile from the sludge fields, and Hunstein noted that G-P’s environmental manager said in a deposition that the mill has received complaints about the odor as far as four to five miles away. The hydrogen sulfide gas odor also would reach every member of the affected class, according to testimony, and two air conditioning technicians supported the conclusion that the gases “would likely affect all air conditioning units within the class area,” she wrote.

“Georgia-Pacific has in fact received complaints regarding corrosion of air conditioning units up to 2.4 miles away from the mill, well beyond the class boundaries,” Hunstein continued, “and has assumed responsibility for replacing an air conditioning unit due to corrosion on at least one property lying outside the class boundaries. In short, the evidence supported the plaintiff’s purported class definition, and the majority is wrong to conclude otherwise.”

Perkins said that in spite of Georgia-Pacific’s claim it is taking steps to halt its pollution, the property damage and continuing drop in value of property value continues to occur.

“For example, there have been several air conditioner failures at homes located in the class area in the past few months alone, and Georgia-Pacific accepts responsibility for those failures,” he said. “Those persons whose property rights have been trampled upon by Georgia-Pacific are entitled to compensation, and we will do everything in our power to help them obtain such relief.”

In a concurrent majority opinion Justice Harold Melton said the application for class action is inappropriate because the tracts of land have differing uses and are located at different distances and directions from the sludge fields.

Justice Blackwell said if the plaintiffs are to meet the commonality requirement, “they have some more work to do.”

But Hunstein also noted that the majority’s opinion expressly contemplates the possibility that the plaintiffs here could still, with additional evidence, establish the existence of a sustainable class. It thus remains to be seen whether this case will move forward as a class action.”

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