By Amanda Bronstad, From The National Law Journal
As a massive natural gas leak just north of Los Angeles continues to surge, plaintiffs attorneys across the country are filing suit over medical problems and lost property values.
The Oct. 23 discovery of a leaking well at an Aliso Canyon natural gas storage facility north of downtown Los Angeles has forced about 2,500 households in a residential area called Porter Ranch to temporarily relocate to area hotels. Two schools have closed, residents have complained of nosebleeds and nausea and, on Jan. 6, California Governor Jerry Brown proclaimed a state of emergency for Los Angeles County. Well owner Southern California Gas Co., a subsidiary of San Diego’s Sempra Energy, has so far been unable to stop the leak.
More than 25 lawsuits have been filed, many of them class actions, but plaintiffs attorneys predict there could be thousands of cases, including claims for lost value on homes that average nearly $1 million.
The lawsuits, including a public nuisance action filed last month by the Los Angeles city attorney’s office, are in the process of being consolidated as a mass tort in Los Angeles Superior Court.
On Jan. 19, many of the plaintiffs attorneys will congregate at a national conference in Santa Monica, California, centered on the Aliso Canyon leak that features keynote speaker Erin Brockovich, the paralegal-turned-consumer activist whose work on a groundwater contamination case against Pacific Gas & Electric Co. was made famous by the 2000 film that bears her name.
“It’s the worst gas leak in California history,” said Brian Panish, a partner at Los Angeles-based Panish Shea & Boyle, who is speaking at the conference. His firm represents 1,200 residents. “It’s the largest release of this kind of natural gas ever.”
The California Air Resources Board estimates that as of Jan. 8, around 23,400 kilograms of methane per hour continues to leak out.
Southern California Gas predicted in filings with the U.S. Securities and Exchange Commission on Jan. 6 that its legal costs could be “significant.” The company, which has $1 billion available in insurance policies, already has spent $50 million on fixing the problem, including providing housing allowances and other costs associated with relocating residents. It also faces investigations from at least seven governmental agencies, some of which could result in massive fines, including the U.S. Environmental Protection Agency and the Los Angeles district attorney’s office.
Southern California Gas plans to determine the extent of emissions and its cause after completing construction of two relief wells, the first by late February or March, that will pump cement into the leaking well to seal it.
“We know that this situation has been frustrating and confusing for many families in the Porter Ranch community, and we apologize,” Gillian Wright, a senior executive for Southern California Gas said in a statement last month. “We share everyone’s concerns about this leak’s ongoing impact on the community and the environment, and we are working as quickly and as safely as possible to stop it.”
A Southern California Gas spokesperson did not return a call for comment about the lawsuits, and James Dragna, a partner in the Los Angeles office of Morgan Lewis & Bockius, who is representing the company, declined to comment.
Although no one has died, the leak has drawn comparisons to the 2010 explosion of a gas pipeline in San Bruno, California, that killed 8 people and destroyed dozens of homes, and to the 2010 Deepwater Horizon oil rig that exploded, killing 11 people and contaminating the Gulf of Mexico with oil.
“This was a natural fit for us,” said Robin Greenwald, of counsel at New York’s Weitz & Luxenberg, who was on the plaintiffs steering committee in the Deepwater Horizon litigation. “We spent the last five-and-a-half years working on the BP oil spill litigation, which has a tremendous number of similarities. There are differences: One is oil, one gas; one air, one water. But this is a well field. So certainly some of the lessons learned in BP will be very useful in this case.”
Weitz & Luxenberg, which is consulting with Brockovich on the cases, is heading up the upcoming plaintiffs’ bar conference at the Loews Santa Monica Beach Hotel. Other national firms involved are Dallas-based Baron & Budd, Seattle’s Keller Rohrback and Morgan & Morgan.
Residents have sued over nosebleeds, headaches, dizziness and other respiratory problems. Southern California Gas officials have said that those problems are temporary and related to additives in the natural gas that have a putrid smell. The company has distributed free air filtration systems to reduce the smell, and area health officials have insisted that exposure to high methane levels isn’t toxic.
But lawsuits allege that the long-term health effects are unclear. In many of the cases, lawyers are insisting that Southern California Gas pay for medical monitoring to screen residents for possible health problems.
Residents also have sued over declining property values. “Homes are frequently where we invest a lot of our savings, and they’re justifiably very concerned about that,” said Greenwald, whose firm has 1,000 clients.
Porter Ranch, which is one mile from the leak, is a planned community of more than 30,000 residents who live in homes worth between $750,000 and $2.5 million, said Greg Owen, senior partner at Owen Patterson & Owen in Valencia, California. He said realtors and brokers in the area now are forced to disclose the leak to prospective buyers.
“I don’t think anybody wants to live there anymore,” he said.
And it’s not just residents. Owen represents 100 businesses in the area that could shut down due to declining sales. Many are predicted to file their own suits. “Their clients have simply picked up and gone to other cities,” Owen said. “Things as simple as a Subway sandwich place—it’s going out of business.”
IMAGE: A sign declares the boundary line of the Southern California Gas Co. gas fields where a gas well has been leaking methane daily near the community Porter Ranch, California. (AP Photo/Michael Owen Baker)
For more on this story go to: http://www.nationallawjournal.com/id=1202746918683/As-California-Gas-Leak-Spews-Suits-Pile-Up#ixzz3x8nQOTbQ