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Be Careful What You Wish For – The Latest Asbestos Example

Be careful what you wish for remains an important maxim for lawyers, lobbyists and risk managers. The latest example arises as it appears the plaintiff’s bar in Illinois out hustled the defense lobbying groups, and achieved a repeal of the 10 year Illinois statute of repose for “premises” claims.  The state legislative record is available online at this page.  How was the statute taken down? It all seems to relate back to a defense friendly ruling sought and achieved last year at SCOTUS on statutes of repose for premises liability claims arising from “toxins” (loosely speaking) As to the actions in Illinois, the U.S. Chamber of Commerce is very unhappy, and complaining bitterly through “news publications” publications it fosters, but the “news articles” do not include the back story.

The back story goes to recent wrangling at SCOTUS about federal preemption of state statutes of repose in the context of CERCLA.  The federal CERCLA statute includes a term that tolls some statutes of limitation. Defense side interests asked for a ruling that it does NOT toll state statutes of repose. The case ended up at SCOTUS, with amicus briefs filed by DRI and other defense side interests (see this page of SCOTUS blog for all the key links).   SCOTUS ruled last summer. The ruling was adverse for plaintiffs in some settings because it refused to allow tolling of state law statutes of repose. The ruling is well explained by Robert Percival at SCOTUS blog. See here for the full explanation; the introduction is pasted below:

“Yesterday in CTS Corp. v. Waldburger, the Court ruled – by a vote of seven to two –that the provision of the federal Superfund law (the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA) that tolls state statutes of limitations until after victims of toxic exposure have discovered their harm, 42 U.S.C. § 9658, does not apply to state statutes of repose.  Statutes of repose set deadlines on the filing of litigation that do not turn on when harm is first discovered.  The decision rested on the majority’s interpretation of the statutory language of CERCLA, which refers only to “statutes of limitations” and not “statutes of repose.”  Even though two of the Justices in the majority admitted at oral argument that they were not aware until recently of any distinction between the two, the majority concluded that Congress had been aware of the distinction when it amended CERCLA in 1986.  Justice Ginsburg and Justice Breyer dissented, finding that Congress had implicitly preempted statutes of repose because they interfere with the congressional purpose of preserving legal recourse for victims of toxic exposures that cause harm with long latency periods.

The decision reverses a Fourth Circuit judgment that had reinstated a lawsuit by a group of North Carolina homeowners who discovered that their well water was contaminated by toxic chemicals decades after an industrial facility owned by CTS Corporation had ceased operations. Because North Carolina has a statute of repose that bars lawsuits from being filed more than ten years after the defendant’s last action, the trial court had dismissed the lawsuit.  As a result of the Supreme Court’s decision, the homeowners’ lawsuit once again will be dismissed.

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So, that was the dynamic as of summer 2014. With that ruling in mind, the focus returns to state law.  There, the basic story is that the Illinois construction statute of repose is one of many sought and obtained over the years by defense interests. See generally this 2013 DRI summary article from Ed Slaughter and others.

Now return the focus to the recent events in Illinois in particular. A November 26, 2014 blog post by Alexander Bandza picks up the story:

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“By Alexander J. Bandza

Under 735 ILCS 5/13-214, Illinois provides for a ten-year statute of repose for any actions in “tort, contract or otherwise” on defects in construction of improvements to real property.  Specifically, subsection (b) provides that:

No action based upon tort, contract or otherwise may be brought against any person for an act or omission of such person in the design, planning, supervision, observation or management of construction, or construction of an improvement to real property after 10 years have elapsed from the time of such act or omission.

State Rep. Nekritz has introduced SB 2221, which would strip the protections afforded by section 5/13-214 for actions “resulting from the discharge into the environment of any pollutant.”  Specifically, the bill adds a new subsection (f), which provides that:

(f) Subsection (b) does not apply to an action that is based on personal injury, disability, disease, or death resulting from the discharge into the environment of any pollutant, including any waste, hazardous substance, irritant, or contaminant (including, but not limited to, smoke, vapor, soot, fumes, acids, alkalis, asbestos, toxic or corrosive chemicals, radioactive waste, or mine tailings).

While speculating on the Legislature’s intent is always risky business, this proposed bill may have been conceived in the wake of the U.S. Supreme Court’s decision in CTS Corporation v. Waldburger, 134 S. Ct. 2175 (2014), which held that CERCLA § 9658 does not preempt states’ statutes of repose.  As Illinois courts have long recognized, the construction statute of repose was enacted for the express purpose of insulating all participants in the construction process from the onerous task of defending against stale claims.  SB 2221’s broad and unqualified language could have the drastic effect of stripping the protections afforded by section 5/13-214 whenever any “discharge into the environment of any pollutant” was involved.

SB 2221 is available here.”

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Against that  background, the plaintiff’s bar appears to have achieved repeal of Illinois’ 10 year statute of repose. More specifically, repealing legislation has passed in Illinois, and awaits a signature by lame duck Governor Quinn, as explained in articles from fronting organizations for the Chamber of Commerce. Presumably Governor Quinn will sign the legislation.

“Be careful what ……

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About Kirk

Since becoming a lawyer in 1983, Kirk’s over 30 years of practice have focused on advising a wide range of corporations, associations, and individuals (as both plaintiffs and defendants) on both tort and commercial law issues centered around “mass torts.”

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