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In Re Genetically Modified Rice Litigation v. Bayer Cropscience Lp

February 1, 2011

IN RE GENETICALLY MODIFIED RICE LITIGATION THIS ORDER RELATES TO: FIRST REMAND GROUP (TEXAS AND LOUISIANA) LELAND VIDRINE, ET AL.
v.
BAYER CROPSCIENCE LP, ET AL. GLENDEN MARCEAUX, ET AL. V. BAYER CROPSCIENCE LP ASWELL FARMS, INC. V. BAYER CROPSCIENCE MITCHELL W. DEVILLE V. BAYER CROPSCIENCELP STAFFORD P. FONTENOT, ET AL. V. BAYER CROPSCIENCE LP VERONA M. COURVILLE V. BAYER CROPSCIENCE LP LONESOME DOVE PLANTATION, LLC V. BAYER CROPSCIENCE LP JODY DAVID FONTENOT, ET AL. V. BAYER CROPSCIENCE LP GLORIA B. FONTENOT V. BAYER CROPSCIENCE LP MITCHELL RAY SOILEAU V. BAYER CROPSCIENCE LP TROY FRUGE V. BAYER CROPSCIENCE LP ROBERT ALLEN BENOIT V. BAYER CROPSCIENCE LP MILLER BROTHERS FARM, ET AL. V. BAYER CROPSCIENCE LP KEITH HENSGENS V. BAYER CROPSCIENCE LP DARREL WAYNE ATTALES, ET AL. V. BAYER CROPSCIENCE LP JESSIE C. FONTENOT V. BAYER CROPSCIENCE LP THOMAS A. SARVER V. BAYER CROPSCIENCE LP BLACK RIVER RICE CO. V. BAYER CROPSCIENCE LP RANDY STUTES V. BAYER CROPSCIENCE LP, ET AL. ROGER LEBLANC V. BAYER CROPSCIENCE LP, ET AL. BRODNEY MOUTON, ET AL. V. BAYER CROPSCIENCE LP, ET AL MARK J. SIMON, ET AL. V. BAYER CROPSCIENCE LP, ET AL. JIM WIESE, ET AL. V. BAYER CROPSCIENCE LP, ET AL. ROSEMARY W. WIED, ET AL. V. BAYER CROPSCIENCE LP, ET AL. WALTER E. DUTCHER, ET AL. V. BAYER CROPSCIENCE LP, ET AL. BENNY WLECZYCK, ET AL. V. BAYER CROPSCIENCE LP, ET AL. TIM ANDERSON, ET AL. V. BAYER CROPSCIENCE LP, ET AL. BRAD ENGSTROM, ET AL. V. BAYER AG, ET AL. DAVID GUTHMAN, ET AL. V. BAYER CROPSCIENCE LP, ET AL. HENRY J. HLAVINKA, ET AL. V. BAYER CROPSCIENCE LP, ET AL. DARBY HOFFMAN, ET AL. V. BAYER AG, ET AL. JOHN KRAMR, ET AL. V. BAYER AG, ET AL. EDWARD KORENEK, ET AL. V. BAYER AG, ET AL. LEON PAVLOCK, ET AL. V. BAYER AG, ET AL. RODNEY PEDERSON, ET AL. V. BAYER AG, ET AL. THOMAS A. SMAISTRLA, ET AL. V. BAYER AG, ET AL. 4:08CV1276 CDP RUDY POLAK, ET AL. V. BAYER CROPSCIENCE LP, ET AL. 4:08CV1281 CDP DAVID R. POLAK, ET AL. V. BAYER CROPSCIENCE LP, ET AL. TERRENCE HLAVINKA CATTLE CO., ET AL. V. BAYER CROPSCIENCE INC., ET AL. WOODSLAND FARMS, ET AL. V. BAYER CROPSCIENCE LP, ET AL. RAYMOND FRANZ, ET AL. V. BAYER CROPSCIENCE LP, ET AL.



The opinion of the court was delivered by: Catherine D. Perry United States District Judge

MEMORANDUM AND ORDER

This order deals with the motions for summary judgment related to the first group of cases to be remanded to their transferor courts for trial. This remand group includes cases from Louisiana and Texas. The Texas plaintiffs in the first remand group are Tim Anderson; Henry J. Hlavinka, Sr.; Edward Korenek; David R. Polak; Walter E. Dutcher; Rudy Polak; Thomas A. Smaistrla; Rodney Pederson; Leon Pavlock; Darby Hoffman; Benny Wleczyck; Brad Engstrom; Terrence Hlavinka Cattle Company; John Kramr; Raymond Franz; David Guthman; Rosemary W. Wied; Jim Wiese; and Woodsland Farms.

The Louisiana plaintiffs in this remand group are Aswell Farms, Inc.; Darrel Wayne Attales and Chrysanna Attales; Robert Allen Benoit; Black River Rice; Verona M. Courville; Mitchell W. Deville; Gloria B. Fontenot; Jessie C. Fontenot; Jody David Fontenot and Amy Fontenot; Stafford P. Fontenot and Odile Fontenot; Troy Fruge; Keith Hensgens; Roger Leblanc; Lonesome Dove Plantation, LLC; Glenden Marceaux and Marceaux Farms, L.L.C.; Miller Brothers Farm and the partners of Miller Brothers Farm: Shelton Miller, Bennie P. Miller, and Marcus J. Miller; Brodney Mouton, Sr.; Thomas A. Sarver; Mark J. Simon and Cynthia L. Simon; Mitchell Ray Soileau; Randy Stutes; and Leland Vidrine and Leland Vidrine Farms.

The parties have filed a number of motions for summary judgment. To a large extent, the motions before me are the same as the motions I ruled on in previous bellwether trials. I have reconsidered the issues and although I have not changed the substance of any of my previous rulings, there are some differences because of the state law and the nature of these particular plaintiffs' claims. The parties have appropriately referenced their previous motions and my previous orders, and I will do the same in this order.

For the reasons that follow and for the reasons that were described in more detail in my orders dated October 9, 2009 [docket #1604], June 7, 2010 [#2981], and October 4, 2010 [#3495], I will grant the motions in part and deny them in part.*fn1 Both the Louisiana and Texas plaintiffs seek damages for negligence and for punitive damages. The Louisiana plaintiffs also seek damages for alleged violations of the North Carolina Unfair Trade Practices Act and for trespass. Defendants have moved for summary judgment on both groups of plaintiffs' negligence claims, arguing that plaintiffs' negligence claims are preempted by the Plant Protection Act and barred by the economic loss doctrine. Defendants also argue that plaintiffs are prohibited from seeking punitive damages as a matter of law, that the North Carolina Unfair Trade Practices Act does not provide the Louisiana plaintiffs with a cause of action, and that the Louisiana plaintiffs cannot prove a trespass to their property.

I will grant defendants' motions for summary judgment on the Louisiana plaintiffs' claims under the North Carolina Unfair Trade Practices Act, as well as defendants' motion for summary judgment on the Louisiana plaintiffs' claim for punitive damages. However, I will deny defendants' motions directed at both groups of plaintiffs' claims for negligence, as well as the Texas plaintiffs' claims for punitive damages and the Louisiana plaintiffs' claims for trespass.

The Texas and Louisiana plaintiffs' complaints also assert several other claims based on a variety of legal theories. Plaintiffs, however, either withdraw these claims, or do not oppose Bayer's motions for summary judgment on these claims. As a result, I will grant Bayer's motions for summary judgment on the Louisiana plaintiffs' claims for public and private nuisance, negligence per se, and to recover damages for mental anguish. Similarly, I will grant Bayer's motions with respect to the Texas plaintiffs' claims for fraud, fraudulent non-disclosure, tortious interference with contract, and tortious interference with prospective business relations.

Finally, I will grant plaintiffs' motions for summary judgment directed to certain affirmative defenses and I will deny plaintiffs' motions to establish Bayer's liability for the actions of its cooperators under various theories of vicarious liability. I have determined that the Plant Protection Act does not preempt plaintiffs' claims and that the regulations do not allow for low level or adventitious presence of regulated genetically modified rice in the commercial rice supply. Otherwise, I have denied the remaining motions.

A. Violations of Statutes or Regulations

In my October 9, 2009 Memorandum and Order, I determined that neither the Plant Protection Act, 7 U.S.C. § 7701 et seq., nor the regulations issued under that act, 7 C.F.R. § 340 et seq., allow any level of adventitious presence of regulated articles such as LLRICE 601 and LLRICE 604 in the commercial rice supply. That ruling remains in effect, and has the same consequences that it had in the earlier cases.

B. North Carolina Unfair Trade Practices Act

The Bayer defendants seek summary judgment on the Louisiana plaintiffs' claims under the North Carolina Unfair Trade Practices Act, N.C. Gen. Stat. § 75-1.1 et seq. (West 2009). It is undisputed that these Louisiana plaintiffs have no North Carolina operations. The question presented by this motion is whether the Act provides a remedy to an out-of-state plaintiff to recover for out-of-state injuries allegedly resulting from unfair acts that occurred in North Carolina. The analysis for this claim is identical to the analysis of the same claim discussed in my orders dated October 9, 2009 and June 7, 20101. For the same reasons that I concluded that the North Carolina Act did not apply to the Missouri plaintiffs, I also conclude that the Act does not provide a cause of action to these Louisiana plaintiffs.

C. Federal Preemption by the Plant Protection Act

Bayer argues that the Plant Protection Act, 7 U.S.C. § 7701 et seq. preempts plaintiffs' claims in this case. Bayer supports its argument entirely by reference to its earlier motions and the plaintiffs respond by reference to their earlier opposition. The Texas plaintiffs also move for summary judgment on this issue, as presented in Bayer's affirmative defense number 12. Because there are no new arguments or evidence, I will deny Bayer's motion for the same reasons stated on the record in the summary judgment hearing held on April 16, 2009. The Plant Protection Act does not preempt plaintiffs' claims in this case because plaintiffs' claims do not attempt to regulate material "in foreign commerce" and because Bayer has not shown that its genetically modified rice constitutes a "plant pest" under the statute.

D. Economic Loss Doctrine

Bayer argues that both the Louisiana and the Texas plaintiffs' claims are barred by the economic loss doctrine. Bayer supports its motion by referencing or reiterating its previous arguments. In response, the Texas plaintiffs have similarly referenced past arguments in their own motion for summary judgment on the same issue, arguing that the economic loss doctrine does not bar their claims in this case.

As stated in my earlier orders dated October 9, 2009, June 7, 2010, and October 4th, 2010, the economic loss doctrine does not apply to these plaintiffs' claims. Bayer has not shown that plaintiffs had a contract with Bayer, that they purchased rice from Bayer, or that plaintiffs could recover for their alleged injuries from a third party under a contract claim, and so the Texas plaintiffs' claims are not barred by the economic loss doctrine.*fn2 Similarly, the Louisiana plaintiffs' claims are not barred by the doctrine because plaintiffs are not seeking to recover for damage to the property of someone with whom they have a contract; rather, they seek to recover for their own losses that resulted directly from Bayer's acts.*fn3

Further, plaintiffs in this case do not seek to recover purely speculative damages. There is a finite, although large, pool of plaintiffs seeking to recover losses on sales that are limited by the amount of rice that they have historically grown and the prices of commodities markets. As result, I will deny Bayer's motions and grant the Texas plaintiffs' motion on this issue.

E. Agency, Successor, Joint Venture, and Non-delegable Duty Liability

Both the Louisiana and the Texas plaintiffs seek to establish the status of various defendants as successors, partners and agents of one another, and to establish that the Bayer entities acted in a joint venture and that they had a non-delegable duty to ensure the confinement of its genetically modified rice. The parties do not raise any new arguments or evidence regarding these issues and so my rulings are the same as in my orders dated October 9, 2009, June 7, 2010, and October 4th, 2010. As I concluded in those orders, genuine ...


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