State v. Atlantic Richfield Company, No. 340-6-14 Wncv (Teachout, J., May 22, 2015)

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                                                      STATE OF VERMONT

SUPERIOR COURT                                                                                             CIVIL DIVISION
Washington Unit                                                                                    Docket No. 340-6-14 Wncv


STATE OF VERMONT,
Plaintiff

v.

ATLANTIC RICHFIELD COMPANY, et al.
Defendants


                                         DECISION
     Defendant Total Petrochemicals & Refining USA, Inc.’s Motion to Reconsider or in the
                  Alternative for Permission to take an Interlocutory Appeal

       This matter is before the Court on a Motion to Reconsider the Court’s January 16, 2015
Decision on Defendant Total Petrochemicals & Refining USA, Inc.’s (“TPRI”) Motion to
Dismiss for lack of personal jurisdiction. Plaintiff State of Vermont opposes the motion.

                                                               Background

        This action relates to contamination of Vermont waters by methyl tertiary butyl ether
(“MTBE”), a gasoline additive. The State has filed this action against 29 co-defendants, all of
whom allegedly participated in the promotion, marketing, distribution, and/or sale of gasoline
containing MTBE in Vermont. The State seeks remediation and recovery costs under a number
of legal theories, including the violation of Vermont groundwater and natural resource protection
statutes, negligence, strict products liability, public and private nuisance, trespass, and civil
conspiracy.

        TPRI sought to dismiss the State’s claims against it for lack of personal jurisdiction. The
Court denied the motion, concluding that TPRI had sufficiently directed its activities towards
Vermont to support Vermont exercising personal jurisdiction over TPRI as it related to those
acts. TPRI now asks the Court to reconsider this ruling, suggesting that the Court overlooked
controlling precedent. In the alternative, TPRI asks for permission to take an interlocutory
appeal of the Decision to the Vermont Supreme Court.

                                                                  Analysis

Motion for Reconsideration

        TPRI first asks the Court to reconsider the denial of its motion pursuant to Vermont Rule
of Civil Procedure 54(b). Rule 54(b) provides that any order which resolve fewer than all of the
claims or rights and liabilities of fewer than all the parties “is subject to revision at any time
before the entry of judgment adjudicating all the claims and the rights and liabilities of all the
parties.” V.R.C.P. 54(b). The Court also has the inherent power to revise such an order. Kelly
v. Town of Barnard, 155 Vt. 296, 307, 583 A.2d 614, 620 (1990) (“[U]ntil final decree the court
always retains jurisdiction to modify or rescind a prior interlocutory order.”) (quoting Lindsey v.
Dayton-Hudson Corp., 592 F.2d 1118, 1121 (10th Cir. 1979)). The Court may only revise such
an interlocutory order “as justice requires and in accordance with the principle of equity and fair
play.” Bostock v. City of Burlington, 2011 VT 89, ¶ 14, 190 Vt. 582. TPRI argues that the Court
overlooked controlling decisions in denying its motion and it is therefore entitled to this relief.

        The cases TPRI suggests the Court overlooked were fully briefed and fully considered by
the Court in deciding the initial motion, and they do not call for reconsideration. TPRI focuses
on caselaw suggesting that mere knowledge of national distribution or the unilateral acts of third
parties are, by themselves, insufficient to support personal jurisdiction. That reasoning is
applicable to some sets of factual circumstances, but the facts of this case are easily
distinguishable. TPRI took active steps in sending its products through the Colonial Pipeline
from Texas to New Jersey and conducted activities in New Jersey that actively directed its
products for distribution and use throughout the entire northeastern United States gasoline
market, including Vermont, such that it could have foreseen being haled into court in Vermont as
a destination state.

        TPRI also cites to a more recent MTBE case which concluded that jurisdiction was not
appropriate in Puerto Rico where the defendant had no ties to Puerto Rico other than its
knowledge, after the fact, that a third party distributor had transported its products for sale in that
territory following isolated stand-alone sales. In re MTBE Prods. Liab. Litig., 2014 WL
1778984 (S.D.N.Y May 5, 2014). This case is also distinguishable. Here, TPRI directed its
products through a national distribution network from Texas to New Jersey and from New Jersey
to the northeastern United States. It did not engage in individual stand-alone sales of specified
quantities “on the spot” with no reason to know the ultimate destination of the product.

      Finding no reason to reconsider or amend the decision on TPRI’s Motion to Dismiss, the
Motion for Reconsideration is denied.

Motion for Interlocutory Appeal

        TPRI also moves for permission to take an interlocutory appeal to the Vermont Supreme
Court regarding whether Vermont has personal jurisdiction over it in this matter. A party is
entitled to permission to appeal an interlocutory order only where the Court concludes the
question of law addressed in the order is controlling, there exists substantial grounds for
difference of opinion regarding that question, and resolution of the question through
interlocutory appeal will materially advance the termination of the litigation. V.R.A.P. 5(b)(1);
In re Pyramid Co. of Burlington, 141 Vt. 294, 301 (1982).

         First, “an order may be ‘controlling’ if reversal would have a substantial impact on the
litigation, either by saving substantial litigation time, or by significantly narrowing the range of
issues, claims, or defenses at trial.” Pyramid Co. of Burlington, 141 Vt. at 303. Regarding

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TPRI’s involvement as a Defendant in this case, the ruling was certainly controlling. If reversed,
the State’s claims against TPRI would necessarily be dismissed and TPRI would avoid this
litigation altogether.

        Second, there exists substantial ground for difference of opinion regarding an issue if “a
reasonable appellate judge could vote for reversal of the challenged order.” Id. at 307. The issue
of when a defendant can be haled into a forum state based on its active participation in what has
been called “the stream of commerce” is one that has proved difficult for even the United States
Supreme Court. See Asahi Metal Indus. Co., Ltd. v. Superior Court, 480 U.S. 102 (1987); J.
McIntyre Mach., Ltd. v. Nicastro, __ U.S. __, 131 S. Ct. 2780 (2011). This Court cannot say that
a reasonable appellate judge could not determine that TPRI lacked sufficient contacts with the
State of Vermont, and reverse the conclusion that personal jurisdiction over TPRI is proper.

         Finally, resolution of this issue will determine whether or not TPRI must defend itself in
what is likely to be a long and complex litigation. As the Court is permitting the State of
Vermont to take an interlocutory appeal regarding the applicability of the statute of limitations, it
will further the ultimate termination of this matter to resolve whether TPRI is a Defendant or not
at this time as well.

                                            Conclusion

         The Court did not overlook any controlling precedent and the caselaw cited by TPRI does
not alter the Court’s decision on the motion to dismiss. An appeal of the Decision on TPRI’s
Motion to Dismiss is, however, appropriate given the nature of the legal issue decided and the
criteria applicable to interlocutory appeals.

                                               Order

       For the forgoing reasons, TPRI’s Motion for Reconsideration is denied, and

TPRI’s Motion in the Alternative for Permission to take an Interlocutory Appeal is granted.

       Dated at Montpelier, Vermont this ____ day of May 2015.




                                                       _____________________________
                                                       Mary Miles Teachout
                                                       Superior Judge




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