Bhopal disaster plaintiffs strike out again

Scott Flaherty, The Litigation Daily (May 24, 2016)

It’s been more than three decades since a gas leak at a Union Carbide pesticide plant in Bhopal, India, sparked what some have called the world’s worst industrial accident. Litigation over the 1984 disaster quickly spread to the United States, where lawyers at Kelley Drye & Warren have been fending off claims ever since.

The firm scored its latest win on Tuesday, defeating a proposed class action brought by Indian plaintiffs who claimed they suffered property damage from groundwater pollution near the now-shuttered Bhopal chemical plant. In a summary order, the U.S. Court of Appeals for the Second Circuit affirmed a Manhattan federal judge’s dismissal of negligence, nuisance and other claims against Union Carbide, which was acquired by Dow Chemical Co. in 2001.

The decision marks a win for William Krohley and William Heck of Kelley Drye, which has represented Union Carbide in Bhopal litigation since the 1980s.  

The disaster began to unfold in December 1984, when toxic methylisocyanate gas leaked from a chemical plant run by Union Carbide India Ltd. (UCIL). The gas leak injured hundreds of thousands of people and, by some estimates, caused as many as 15,000 deaths.

At the time, the U.S.-based Union Carbide Corp. held a little more than a 50 percent stake in UCIL, though the American company later sold its share and used the proceeds to fund a hospital focused on treating Bhopal victims. The plant shut down after the gas leak and never resumed normal operations.

Almost immediately after the accident, personal injury lawyers filed suit in the U.S. on behalf of Indian victims. Those cases were eventually sent to Indian courts, and in 1989, Union Carbide and UCIL reached a $470 million settlement with India’s government meant to resolve the personal injury claims.

The settlement didn’t spell the end of Bhopal litigation, however. Plaintiffs lawyers in the U.S. later brought three additional putative class actions alleging personal injury, environmental damage and property loss. Two of those suits, filed in 1999 and 2004, have since ended, with Kelley Drye persuading district courts and the Second Circuit to rule for Union Carbide. 

Tuesday’s decision comes in the third of the more recent Bhopal suits, which dates to 2007.

The plaintiffs--represented by EarthRights International lawyer Richard Herz alongside lawyers from Hausfeld and Sharma & DeYoung and New York-based solo practitioner Curtis Trinko--alleged that the Bhopal plant had inadequate systems for dealing with hazardous waste and that the pollution caused property damage.

The core question was whether U.S.-based Union Carbide could be held liable for the pollution allegedly caused by weaknesses in the Bhopal plant’s waste management system. The plaintiffs argued that they had new evidence--not considered in earlier cases--establishing that Union Carbide had a hand in building the system along with its Indian subsidiary.

But U.S. District Judge John Keenan in Manhattan, who has presided over Bhopal litigation since the 1980s, wasn’t convinced. He found in July 2014 that Union Carbide couldn’t be liable since it didn’t build the waste management system in Bhopal—UCIL had completed that job, the judge concluded.

The Second Circuit agreed. The plaintiffs “are not offering new factual evidence, but rather, are offering conclusions based on the same evidence that we addressed and found lacking in [earlier Bhopal litigation],” the panel wrote Tuesday.

Herz of EarthRights International, who argued the Second Circuit appeal for the plaintiffs, said in a statement that he disagrees with the appeals court’s ruling. The appeals court, he said, effectively concluded that the U.S.-based Union Carbide “is not responsible for the actions of its own employee, who oversaw the construction of the plant.”

“These families have been living with Union Carbide’s pollution for decades,” said Herz. “This lawsuit is only one of the many efforts, in India and the United States, to obtain justice and a cleanup for the people of Bhopal, and we remain committed to that work.”

Kelley Drye’s Krohley, who argued the appeal for Union Carbide, said in an email that the decision was consistent with several past district court and appellate rulings.