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Sterling v. Velsicol Chem. Corp.

Citation: 19 ELR 20404
No. No. 86-6087, 855 F.2d 1188/27 ERC 1985/(6th Cir., 08/29/1988) Aff'd in part, rev'd in part

The court holds a chemical company that disposed of hazardous waste liable for contamination of drinking water, but reverses much of the damages awarded by the district court. The court first finds that it has subject matter jurisdiction. Although the defendant properly challenged the individual damage claims of many defendants, alleging that the jurisdictional amount of $ 10,000 had not been met, the district court permissibly deferred its decision on the motion until trial, and at the time of the motion plaintiffs' counsel asserted that each plaintiff's claim met the jurisdictional amount. The district court also permissibly certified the case as a class action. although the issue of damages may be individualized, liability can be determined on a class-wide basis because the cause of the disaster is a single course of conduct that is identical for each plaintiff.

The court next holds that there was sufficient evidence of causation to liken the defendant's waste disposal to the plaintiffs' injuries [19 ELR 20405] in general. The water model used to determine exposure to contaminated groundwater was carefully considered by the district court and incorporated most of the relevant data. The chemicals in the groundwater were capable of producing the plaintiffs' injuries. However, individual damages must still be proximately caused by the contamination to a reasonable medical certainty. A reasonable medical certainty is greater than a "likelihood" or "more likely than not." On this basis, the court remands particular damage awards for presently ascertainable injuries so that the district court may recalculate those portions that are insufficiently supported.

The court holds that damages can be awarded for an increased risk of cancer and other diseases only if the disease is medically reasonably certain to follow from the present injury. The mere increased risk of a future disease resulting from an initial injury is not compensable. The court holds that such damages cannot be awarded in this case where the increased risks were calculated at 25 to 30 percent. Awards for mental distress based on the future onset of an as yet unrealized disease are recoverable only where such distress is foreseeable or a natural consequence of the present injury. The underlying future susceptibility to the disease need not be compensable for mental stress to be compensable. Thus, such mental distress damages are properly compensable here, but the awards of $ 50,000 to $ 250,000 are excessive and must be reduced to $ 18,000 to $ 72,000. The court reverses the award of damages to all plaintiffs based on immune system impairment because this is not based on a generally accepted scientific theory. The court reversed the award of damages for post-traumatic stress disorder, holding that drinking of contaminated water is not a sufficient stress and there was not evidence of a recurring fear. The court reverses the damages for impaired quality of life to plaintiffs who were not residents of the contaminated area. For two plaintiffs, the award for lost wages and impaired earning capacity are reversed for insufficient evidence. The court upholds the award for diminution in property value based on lowered market value of real property. While prejudgment interest for property damage is proper under Tennessee law, it is not available for compensatory awards or physical or emotional damages. The court reverses the award of punitive damages based on the defendant's trial strategy, since there is no evidence it was frivolous or in bad faith, but punitive damages are permissible for the defendant's knowing violation of state law in disposing of its hazardous waste.

A concurring opinion would have permitted a rebuttable presumption of proximate causation where the record contains expert testimony on the chemicals and proof of exposure.

[This decision replaces the decision reported at 18 ELR 20978. The opinion below is digested at 17 ELR 20081 and analyzed at 17 ELR 10155. An appellate brief is digested at ELR PEND. LIT. 65963.]

Counsel for Plaintiffs-Appellees
Sidney W. Gilreath
Gilreath & Associates
707 Gay St. SW, P.O. Box 1270, Knoxville TN 37901
(615) 637-2442

James W. Gentry Jr.
Gentry & Boehm
Ste. 600, Dome Bldg., Chattanooga TN 37402
(615) 756-5020

Counsel for Defendant-Appellant
James S. Wilder III
125 W. Market St., Somerville TN 38068
(901) 465-4227

Before: LIVELY, JONES, and GUY, Circuit Judges.