Humphrey, et al. v. Hexion Specialty Chemicals Inc. (W.D. Kentucky)
The case was a purported class action allegedly on behalf of approximately 400 individuals, asserting property damage and nuisance claims based on the operation of our client's chemical manufacturing facility adjacent to the class members' homes. In particular, the class members complained of odors emanating from Hexion Specialty Chemicals's plant. The plaintiffs never officially stated what they were seeking, although they were seeking both compensatory and punitive damages. Our attorneys were able to settle the litigation very early, before the court ruled on the plaintiffs' motion for class certification. Under the terms of the settlement, Hexion Specialty Chemicals paid $1.25 million in settlement funds, which covered both distributions to the plaintiff class and plaintiffs' attorney fees. In addition, Hexion Specialty Chemicals was required to make certain improvements to its plant to further control air emissions and odors and to set up a system for community members to relay their future concerns to Hexion Specialty Chemicals. The then-estimated costs of the improvements to Hexion Specialty Chemicals were $3.9 million. Plaintiffs agreed to release Hexion Specialty Chemicals from all past personal injury claims and all past and future claims for property damage or nuisance based on the continued normal operation of Hexion Specialty Chemicals's plant. Plaintiffs also agreed to attach deed notices to their properties setting forth the terms of the settlement and to the issuance of an injunction barring future residents and property owners within the class area from suing Hexion Specialty Chemicals for a period of five years.
The settlement was a good result for the client because (i) it allowed it to end the litigation early, thereby saving litigation costs; (ii) required it to pay a limited amount in cash damages relative to its potential exposure at trial while channeling the bulk of the relief into actions that will benefit the plaintiffs by reducing the likelihood of future problems; (iii) guaranteed Hexion Specialty Chemicals a period of peace from litigation for at least five years; and (iv) allowed Hexion Specialty Chemicals to continue its relatively good relationship with the neighboring community.