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In re Methyl Tertiary Butyl Ether (" MTBE") Products Liability Litigation

United States District Court, S.D. New York

February 6, 2014

IN RE: METHYL TERTIARY BUTYL ETHER (

Michael Axline, Esq., Miller, Axline & Sawyer, Sacramento, California For Plaintiffs.

Robert E. Meadows, Esq., James J. Maher, Esq., Jeremiah J. Anderson, Esq., King & Spalding LLP, Houston, Texas.

Charles C. Correll, Jr., Esq., King & Spalding LLP, San Francisco, California, for defendant Chevron, U.S.A., Inc.

OPINION AND ORDER

SHIRA A. SCHEINDLIN, District Judge.

I. INTRODUCTION

This is a consolidated multi-district litigation ("MDL") relating to contamination actual or threatened - of groundwater from various defendants' use of the gasoline additive methyl tertiary butyl ether ("MTBE") and/or tertiary butyl alcohol, a product formed by the breakdown of MTBE in water. In this case, the New Jersey Department of Environmental Protection, the Commissioner of the New Jersey Department of Environmental Protection, and the Administrator of the New Jersey Spill Compensation Fund allege that Chevron U.S.A., Inc.'s ("CUSA") use and handling of MTBE has contaminated, or threatened to contaminate groundwater within their jurisdiction. Familiarity with the underlying facts is presumed for the purposes of this Order.

Currently before the Court is a motion for summary judgment brought by CUSA on the ground that the previously undisclosed theory of liability supporting plaintiffs' claims against CUSA should be precluded pursuant to Federal Rule of Civil Procedure 37(c)(1). For the reasons stated below, the motion is GRANTED.

II. BACKGROUND[1]

This case was filed in the District of New Jersey and was transferred to this Court as part of the MTBE MDL on January 14, 2008. Plaintiffs originally asserted claims against Chevron Corporation or CUSA at four trial sites: (1) the West Windsor Getty Service Station ("Getty"); (2) the HP Delta Service Station; (3) the Skyline Service Center ("Skyline"); and (4) the Baker's Waldwick Gulf Service Station ("Baker's Waldwick").[2] I dismissed all claims against CUSA at Baker's Waldwick on August 20, 2013 On August 27, 2013, I dismissed all claims against Chevron Corporation. Plaintiffs' only remaining claims against CUSA stem from CUSA's alleged connection with Skyline.

In contention interrogatories dated September 7, 2012 (the "Contention Interrogatories"), plaintiffs were asked to identify defendants alleged to be liable for damages at each delineated trial site.[3] Plaintiffs were asked to "identify all facts" and documents that would prove each defendant's liability at each site.[4] Plaintiffs identified Sunoco, "Texaco, " Shell and CITGO with respect to Skyline.[5] Although plaintiffs believed Chevron Corporation to be the successorin-interest to Texaco, Inc. ("Texaco"), [6] plaintiffs only named "Chevron" in connection with Getty[7] and Baker's Waldwick.[8] With regard to Skyline, plaintiffs contended that "Texaco supplied MTBE gasoline to Skyline from October 1991 to September 1997 pursuant to a branding agreement."[9] Plaintiffs also provided theories of liability for Sunoco and CITGO at Skyline.[10] Plaintiffs did not describe a theory of liability identifying "Chevron" or CUSA with Skyline.

Case Management Order 107 ("CMO 107"), issued December 27, 2012, limited plaintiffs' claims at Skyline to Sunoco, Texaco, CITGO, and "Chevron". On the basis of the Contention Interrogatories and CMO 107, CUSA's expert witness, Dr. Michael Keeley, reported that plaintiffs "identified Chevron and Texaco with [Skyline] by virtue of an alleged supply agreement between Texaco and the station operator."[11] Dr. Keeley stated, "There is no allegation that Chevron supplied gasoline to [Skyline]."[12] Plaintiffs did not refute this statement prior to March 1, 2013 - the close of expert discovery.[13]

Plaintiffs now allege that CUSA is liable for MTBE contamination at Skyline due to its relationship with non-party Star Enterprise ("Star").[14] Plaintiffs allege that CUSA sold MTBE gasoline to Star, and that Star was "the sole supplier of gasoline to Skyline during a time when MTBE releases occurred...."[15] Plaintiffs did not disclose their current theory of liability (the "Star Theory") in their answers to the Contention Interrogatories or at any time prior to a pre-motion letter dated September 4, 2013, [16] almost a year after the close of fact discovery.

CUSA argues that plaintiffs should not be allowed to pursue a theory of liability they did not disclose in response to the Contention Interrogatories. Plaintiffs argue that failure to amend their contentions should not preclude use of the Star Theory for two reasons. First, plaintiffs respond that CMO 107 gave CUSA notice of plaintiffs' claims against it at Skyline. ...


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