Appeal from the United States District Court for the Southern District of Indiana, Indianapolis Division. No. 90 C 2036--Larry J. McKinney, Judge.
Before WOOD, JR., ROVNER, and EVANS, Circuit Judges.
WOOD, JR., Circuit Judge.
ARGUED SEPTEMBER 27, 1995
DECIDED NOVEMBER 30, 1995
John W. Baker, Norma J. Baker, Douglas Baker, and Jennifer Baker (collectively, "the Bakers") appeal the decision of the district court to partially grant the motion to dismiss filed by Westinghouse Electric Corporation ("Westinghouse"). For the reasons given below, we affirm the decision of the district court.
The facts of this matter, viewed in the light most favorable to the Bakers at this stage of the proceedings, are as follows. John W. Baker was employed by Westinghouse at its Muncie, Indiana facility from 1965 until 1984. In 1973, Baker requested that he be allowed to remove to his home some scrap insulation from the Muncie plant for his personal use. Westinghouse granted this request despite its knowledge that this insulation was contaminated with polychlorinated biphenyls--more commonly known as "PCBs." Before its removal, the insulation in question had been attached to certain equipment in the Muncie plant. Baker, who did not know of the insulation's contamination, used it to insulate his garage, a chicken coop, and an underground water line.
In 1989, Baker's wife, Norma J. Baker, became concerned that the insulation might contain PCBs. She consequently contacted the United States Environmental Protection Agency ("the EPA"). The EPA initially declined to take any action; Mrs. Baker responded by threatening to burn down her garage. The EPA thereafter conducted a removal action pursuant to its authority under the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. sec. 9601 et seq.
The procedural history of this case is somewhat complex; the relevant portions are summarized here in order to illuminate the present stance of the parties. The Bakers, together with their children Douglas and Jennifer, initially brought suit against Westinghouse in October, 1990, in state court. Westinghouse filed a Notice of Removal on November 6, 1990--jurisdiction in the district court being founded upon diversity of citizenship.
The Bakers then filed an amended complaint on January 8, 1991, which alleged causes of action for negligence, nuisance, indemnity, and intentional misconduct under Indiana law. The amended complaint sought compensation for the following categories of damages: (1) the costs of future medical monitoring; (2) compensatory damages for annoyance and disruption; (3) compensatory damages for loss of homeowner's insurance; (4) compensatory damages for the decrease in the value of their real estate; (5) indemnification for any cleanup costs assessed by the EPA; and (6) punitive damages.
Westinghouse filed a motion on February 19, 1991, to dismiss the amended complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. On June 25, 1991, the district court partially granted this motion, dismissing the Bakers' nuisance count. *fn1 The district court ruled that the Bakers had failed to state a cause of action for nuisance because the case did not involve a conflict between neighboring land uses. *fn2 Furthermore, the district court dismissed, without prejudice, the Bakers' claims for future medical monitoring expenses. The district court did, however, afford the Bakers an opportunity to amend their medical monitoring claim: The district court stated that it would reconsider the matter if the Bakers amended their complaint, within twenty days, to allege that some present physical injury was caused by the contaminated insulation.
The Bakers then filed a motion for leave to file a second amended complaint on July 11, 1991. On November 15, 1991, the district court denied this motion as the second amended complaint contained counts that had been dismissed by the district court in its June 25, 1991 order. The district court ordered the Bakers to file a ...