United States District Court, N.D. Illinois, Eastern Division
ROSALIO CAMPOS, RAYMOND FIGUEROA, PATRICIA A. FISHER, SUSAN SADLOWSKI GARZA, JANE GOULD, LILLY MARTIN, ALFREDO MENDOZA, KEVIN P. MURPHY, JOANN PODKUL, and JEAN TOURVILLE, individually and on behalf of all other persons and entities similarly situated, Plaintiffs,
BP PRODUCTS NORTH AMERICA, INC., CALUMET TRANSLOAD RAILROAD LLC, DTE CHICAGO FUELS TERMINAL, LLC, GEORGE J. BEEMSTERBOER, INC., BEEMSTERBOER SLAG AND BALLAST CORPORATION, KCBX TERMINALS COMPANY, KM RAILWAYS, LLC, and KOCH CARBON, LLC, Defendants.
MEMORANDUM OPINION AND ORDER
MANISH S. SHAH, District Judge.
Petcoke is a dust-like byproduct of the crude-oil refining process, and is itself valuable as a fuel. Plaintiffs own properties in Southeast Chicago and seek to represent a class of such property-owners. They allege that petcoke and coal dust that was stored unenclosed and uncovered, at three facilities in Southeast Chicago, has blown onto their properties and polluted the area's air. Defendants-multiple companies involved in one way or another with the three storage facilities-move to dismiss the complaint in its entirety. Defendants' motions are granted in part and denied in part, as discussed below.
I. Legal Standards
A complaint must include "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). The short and plain statement must "give the defendant fair notice of what the claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal marks omitted). To survive a motion to dismiss under Rule 12(b)(6), the complaint must "state a claim to relief that is plausible on its face." Yeftich v. Navistar, Inc., 722 F.3d 911, 915 (7th Cir. 2013) (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). In deciding a Rule 12(b)(6) motion, courts must construe the complaint in the light most favorable to the plaintiff, accept as true all well-pleaded facts, and draw reasonable inferences in the plaintiff's favor. Yeftich, 722 F.3d at 915.
A. Background on Petcoke and Coal Dust
Petcoke is a black, powdery byproduct of the crude-oil refining process. CCAC ¶¶ 2, 27, 34-35. It is principally used to generate electricity, to create aluminum and steel, and to make cement. CCAC ¶ 28. Like coal dust, petcoke is lightweight, dust-like, and susceptible to being transported by wind and to being inhaled. CCAC ¶ 29. Petcoke can be harmful if inhaled (CCAC ¶ 2), and can damage property if allowed to accumulate (CCAC ¶¶ 5-14). Burning petcoke-for example, to generate electricity-harms the environment and is therefore substantially restricted in the United States. CCAC ¶¶ 30-31. Nonetheless, a substantial market for petcoke exists in other countries. CCAC ¶ 32. In 2012, over 80% of the petcoke produced by refineries in the United States was exported. CCAC ¶ 32. Plaintiffs allege that defendants (either directly or indirectly) profit by selling petcoke. CCAC ¶ 3.
B. Generation of Petcoke
Defendant BP Products North America, Inc., produces and sells oil and natural gas. CCAC ¶ 18. Petcoke is a byproduct of BP's oil-refinery process. CCAC ¶ 18. When BP expanded its Whiting, Indiana, oil refinery, its permit detailed mandatory precautions regarding the handling, storage, and transfer of petcoke:
Potential fugitive dust emissions may result from coke handling, storage and transfer operations. The coke handling system will be designed to minimize fugitive dust emission from the coke handling process[...] When the coking process is complete [and following the coke's watering and dewatering][...] it is moved by a bridge crane to a partially enclosed crusher. From the crusher the coke is conveyed in an enclosed conveyor to a transfer tower. The coke is then transferred using a series of enclosed conveyors to either the day bin for loadout into rail cars, or if necessary to the enclosed coke storage pile for temporary storage.
CCAC ¶ 39 (alterations in original). BP stores about five days' production of petcoke at its Whiting refinery. CCAC ¶ 41. Under BP's permit, and a consent decree, the petcoke stored at Whiting is surrounded by 40-foot walls, and an enclosed conveyor and loading system is equipped with wind screens and water sprayers to keep dust down. CCAC ¶ 41.
C. Transport and Storage of Petcoke
After about five days, petcoke produced at BP's Whiting refinery is transported to the storage facilities at issue in this case. CCAC ¶ 42. The facilities are near densely populated residential neighborhoods in Chicago. CCAC ¶ 43. Defendant Koch Carbon, LLC, owns or controls a substantial amount of petcoke and coal dust that is stored at all three facilities. CCAC ¶ 24.
Defendants George J. Beemsterboer, Inc. and Beemsterboer Slag and Ballast Corporation own or operate the "Beemsterboer Terminal"-a facility located at 2900 E. 106th Street,  at which large quantities of petcoke and coal dust have been stored. CCAC ¶¶ 20-21.
Defendant KCBX Terminals Company owns or operates two storage and transfer terminals: the "100th Street Terminal" located at 3259 E. 100th Street, and the "Burley Terminal" located at 10730 S. Burley Avenue. CCAC ¶ 17. At these terminals, KCBX stores large quantities of petcoke and coal dust. CCAC ¶¶ 17, 44.
Defendant KM Railways, LLC ("KMR") owns the property on which the Burley Terminal is located. CCAC ¶ 19. Until December 2012, defendant DTE Chicago Fuels Terminal LLC owned and operated the Burley Terminal and the land on which it is located, and stored uncovered petcoke and coal dust there. CCAC ¶ 22. Defendant Calumet Transload Railroad LLC operates a facility at the Burley Terminal, where large quantities of petcoke and coal dust are stored. CCAC ¶ 23. Additionally, until February 8, 2007, Calumet Transload owned and operated the Burley Terminal and the land on which it is located. CCAC ¶ 23.
Although covering or enclosing the petcoke and coal dust is possible, the relevant defendants have refused to do so: the dust is stored outside in large, uncovered piles. CCAC ¶¶ 44-45, 57-58.
D. Harm to Plaintiffs
Plaintiffs own properties near the storage facilities. CCAC ¶¶ 5-14. Plaintiffs allege that "[a]s a direct and foreseeable result" of defendants' conduct, "petcoke and coal dust have been blown throughout surrounding communities, contaminating the air and coating the... property within affected areas, reducing the value... and interfering with... reasonable use and enjoyment of such property." CCAC ¶ 4. Plaintiffs allege that they have been exposed to polluted air and have been forced to spend time, money, and effort cleaning the petcoke and coal dust from their properties. CCAC ¶¶ 5-14, 51-53, 56. They allege decreased values, and reduced use and enjoyment, of their properties. CCAC ¶¶ 5-14, 49-51, 54. They have spent excess money on air conditioning (because doors and windows must be kept shut to keep the dust out). CCAC ¶ 51. Some real and personal property has been ruined by the dust. CCAC ¶ 55. Plaintiffs allegedly live in fear, apprehension, and great distress. CCAC ¶ 16.
A. Group Pleading
Count II of the complaint is the only one directed at a single, specific defendant (BP). Counts III, IV, VII, VIII, and IX are directed at all defendants, and Counts I, V, and VI are directed at the "Storage/Distribution Defendants" (all defendants except BP). The complaint begins with allegations common to all counts (CCAC ¶¶ 1-66), and then contains count-specific allegations (CCAC ¶¶ 67-119). Even though all counts except Count II are directed at multiple defendants, the count-specific allegations do not differentiate among the defendants-nothing specific is said about a particular defendant that distinguishes its alleged conduct from that of its co-defendants. All defendants complain that this "group pleading" strategy is insufficient under Rule 8 of the Federal Rules of Civil Procedure.
The common (meaning not count-specific) allegations set forth, in short and plain statements, each defendant's conduct related to petcoke at specific locations. This is adequate to put each defendant on notice as to the claims against it. Specifically:
The claims against BP concern all three storage facilities. BP is alleged to be a source of petcoke that is stored at ...