Appeal: Oil pipe one unit, not bits

Exxon suit seeks class status again

Landowners along Exxon Mobil's Pegasus pipeline share common issues and qualify for class-action status in a federal lawsuit, in part because the line operates as a single "continuous unit" and landowners' claims will not require "parcel by parcel" analysis, attorneys argued Monday.

For these and other reasons, the attorneys for the landowners said, a federal appeals court should reverse a lower court's decision dismissing the lawsuit and decertifying the class.

Also Monday, a spokesman for the federal Pipeline and Hazardous Materials Safety Administration confirmed that the regulatory agency had granted a request by an Exxon Mobil Corp. subsidiary, Exxon Mobil Pipeline Co., to stay the payment of a $2.6 million civil penalty imposed because of safety violations the agency said it had found with the Pegasus.

Spokesman Damon Hill said the safety administration also had put on hold the terms of a compliance order while the agency reviews the company's petition for reconsideration of the findings and the penalty.

Hill said the stay was for 90 days. A copy of the letter advising Exxon Mobil of the decision was released Monday and was dated Nov. 4.

In the lawsuit, attorneys filed the 79-page document asking the 8th U.S. Circuit Court of Appeals in St. Louis to reverse a March ruling by Judge Brian Miller in U.S. District Court in Little Rock.

The lawsuit's original plaintiffs, landowners Arnez and Charletha Harper and Rudy and Betty Webb, filed the complaint in response to a March 2013 oil spill in Mayflower.

Miller originally granted class-action status to landowners whose property was physically crossed by Exxon Mobil's Pegasus pipeline running from Corsicana, Texas, to Patoka, Ill. But in March, he reversed his own ruling.

In Monday's filing, attorneys for the landowners also quoted a metallurgist, Tom Eager, as saying the pipeline, built in 1947-48, was "worn out" and had an "antiquated cancer-causing asbestos coating."

"The Landowners were denied enforcement of their private rights under state common law to remedy this unreasonable interference with their property," the attorneys wrote.

"As a consequence, the contamination from the Pegasus Pipeline will simply stay in the ground, continuing to permanently injure the Landowners' property," they added. "By virtue of the district court's action, Landowners with a contractual easement, which reserves to them substantial rights, must continue to suffer a dangerous pipeline on their property without any redress for their claims under state law."

An Exxon Mobil spokesman did not immediately comment on the appeal document.

Even though landowners along the Pegasus live in Arkansas, Texas, Missouri and Illinois, they share common issues, their attorneys said.

"The reality is that Landowners' claims will not require a parcel-by-parcel analysis," they wrote.

The attorneys said the District Court had adopted Exxon Mobil's defense when the court reversed the class-certification. They said the lower court had accepted the defense that the pipeline "consisted of different segments" and that each landowner's easement should be considered independently.

"The use of the easement is uniform to all [proposed] class members because the Pegasus Pipeline is one pipeline," the attorneys countered.

They added: "The pipeline functions and is operated by Exxon as one continuous unit along the landowners' property and based on the same contractual promise from Exxon. ... The pipeline operates as a whole for a single purpose and is one petroleum delivery system, pumping petroleum throughout the landowners' real property. ... The contamination factors produced by the Pegasus Pipeline are common to the entire pipeline and the Landowners' real property through which it passes."

Rather than focusing on any segment-by-segment issues, the attorneys said, "Exxon's whole pipe is hazardous," and the "Landowners have met the commonality requirement" for class-action status.

The 650-mile-long segment of the Pegasus pipeline covered in the lawsuit has been shut down since shortly after the spill in Mayflower. Only the pipeline's remaining 211-mile stretch, which runs from Corsicana, to Nederland, Texas, has resumed service.

The pipeline cracked open in Mayflower's Northwoods subdivision on March 29, 2013, and spilled tens of thousands of gallons of heavy crude into the neighborhood, drainage ditches and a cove of Lake Conway.

A Texas laboratory hired by Exxon Mobil found that manufacturing defects, specifically cracks that likely were present from the time of manufacturing or shortly thereafter and that worsened over the years, caused the rupture. The industry has known for decades that such defects are common in pre-1970, electric-resistance welded pipe, the type used in the Pegasus. It no longer is made.

State Desk on 11/17/2015

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