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Yarbrough v. Hunt Southern Group, LLC

United States District Court, S.D. Mississippi, Southern Division

September 12, 2019

HUNT SOUTHERN GROUP, LLC formerly known as Forest City Southern Group, LLC; et al. DEFENDANTS



         BEFORE THE COURT are the [229] Motion for Summary Judgment filed by Defendants Hunt Southern Group, LLC and Hunt MH Property Management, LLC and [234] Motion for Summary Judgment filed by Defendant Forest City Residential Management, LLC. The Motions argue that there are no material issues of fact and the Defendants are entitled to summary judgment on each and every one of Plaintiffs' claims. The Motions are fully briefed. Having considered the submissions of the parties, the record, and relevant law, the Court finds that Defendants' Motions for Summary Judgment should be granted. Plaintiffs' claims will accordingly be dismissed.

         I. BACKGROUND

         The plaintiffs in this case - Michael Yarbrough, Jr., Ann Yarbrough, Alizelyia Yarbrough, Michael Yarbrough, III, and James Yarbrough - allege that they were exposed to mold while living in on-base housing at Keesler Air Force Base in Biloxi, Mississippi. This is one of fourteen pending similar cases filed by military families at Keesler.[1] The defendants are alleged to have owned or managed the subject on-base housing since its construction was completed in 2011. Forest City Southern Group, LLC (“Forest City Southern”) purchased the structures from the Air Force on September 30, 2011 and obtained a 50-year lease on the land underlying the structures.[2] In February 2016, the ownership of the housing structures and the lease of the underlying land were purchased from Forest City Southern (presumably by a parent company of Hunt Southern Group, LLC), and Forest City Southern's name was changed to Hunt Southern Group, LLC (“Hunt Southern”). Forest City Residential Management, LLC (“FCRM”), which had managed and operated the property for Forest City Southern, ceased managing and operating the property with its sale, and Hunt MH Property Management, LLC (“Hunt Management”) became manager and operator for Hunt Southern.

         Plaintiffs commenced a lease of their residence on October 1, 2011. (See Military Lease Agreement 1, ECF No. 196-1.) Plaintiffs assert they repeatedly requested that Defendants address maintenance concerns involving mold and water damage in their residence. Defendants sent maintenance technicians, who reported that the mold and leaks were resolved. However, say Plaintiffs, Defendants never actually fixed the cause of the mold - air conditioning ductwork that sweat because it was poorly insulated - instead simply cleaning up the visible mold with soap and water each time. Plaintiffs contend that Defendants' agents fraudulently misrepresented that mold problems had been rectified when, in fact, they had not. Plaintiffs state that because of Defendants actions and inactions, they were exposed to elevated levels of toxic mold. As a result, Plaintiffs say they were forced to leave their home and suffered and continue to suffer physical and emotional injuries, medical expenses, and property damage.

         Plaintiffs assert claims for negligence, gross negligence, breach of contract, civil conspiracy, alter ego, fraudulent concealment, intentional endangerment, constructive eviction, violation of § 3951 of the Servicemembers Civil Relief Act (“SCRA”), breach of agreement to repair, and third-party beneficiary breach of contract.

         The Motion for Summary Judgment filed by Hunt Southern and Hunt Management argues that they are entitled to summary judgment because, among other things, (1) Plaintiffs have put forward no evidence that mold present in their home rendered it dangerous or unsafe, (2) Plaintiffs cannot establish that the Hunt Defendants breached a duty of care because they do not have the necessary expert testimony, (3) Plaintiffs cannot establish that any of their injuries were proximately caused by mold exposure, (4) Plaintiffs cannot establish that the Hunt Defendants breached the lease agreement, (5) Plaintiffs cannot establish an underlying tort for a civil conspiracy claim, (6) Plaintiffs cannot establish a claim for constructive eviction or SCRA claim because they were never evicted (constructively or otherwise), (7) Plaintiffs' third-party beneficiary claim is expressly disclaimed by the Master Development and Management Agreement entered into by the Air Force and Forest City Southern, and (8) Plaintiffs claims for alter ego, fraudulent concealment, and intentional endangerment are not independent causes of action. FCRM makes the same arguments in its Motion for Summary Judgment, but also asserts that it was never party to the lease agreement Plaintiffs signed.


         a. Summary Judgment Standard

         Federal Rule of Civil Procedure 56(a) provides that summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). “[T]he nonmovant must go beyond the pleadings and designate specific facts showing that there is a genuine issue for trial.” Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc).

         “A genuine dispute of material fact means that ‘evidence is such that a reasonable jury could return a verdict for the nonmoving party.'” Royal v. CCC & R Tres Arboles, L.L.C., 736 F.3d 396, 400 (5th Cir. 2013) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). If the evidence presented by the nonmovant “‘is merely colorable, or is not significantly probative,' summary judgment is appropriate.” Cutting Underwater Techs. USA, Inc. v. ENI U.S. Operating Co., 671 F.3d 512, 516 (5th Cir. 2012) (quoting Anderson, 477 U.S. at 249). In deciding whether summary judgment is appropriate, the Court views the evidence and inferences in the light most favorable to the nonmoving party. RSR Corp. v. Int'l Ins. Co., 612 F.3d 851, 857 (5th Cir. 2010).

         b. Analysis

         A threshold issue not directly addressed by the parties is the impact of Keesler Airforce Base's status as a federal enclave on the choice of substantive law for Plaintiffs' personal injury claims. See United States v. Tax Comm'n of Miss., 421 U.S. 599, 600-01 (1975). “Generally, when an area in a State becomes a federal enclave, ‘only the [state] law in effect at the time of the transfer of jurisdiction continues in force' as surrogate federal law.” Parker Drilling Mgmt. Servs., Ltd. v. Newton, 139 S.Ct. 1881, 1890 (2019) (quoting James Stewart & Co. v. Sadrakula, 309 U.S. 94, 100 (1940)). “Existing state law typically does not continue in force, however, to the extent it conflicts with ‘federal policy.' And going forward, state law presumptively does not apply to the enclave.” Id. (citations omitted). “This approach ensures ‘that no area however small will be without a developed legal system for private rights,' while simultaneously retaining the primacy of federal law and requiring future statutory changes to be made by Congress.” Id. (quoting Sadrakula, 309 U.S. at 100; citing Tax Comm'n of Miss., 412 U.S. at 370 n.12).

         Congress has eliminated the need to determine Mississippi personal injury law at the time Keesler became a federal enclave. 28 U.S.C. § 5001 provides that current state law governs actions for personal injuries that occur “in a place subject to the exclusive jurisdiction of the United States within a State.” 28 U.S.C. § 5001; see Rodriguez v. Nationwide Homes, Inc., 765 Fed.Appx. 782, 785 (10th Cir. 2018); La. United Bus. Ass'n Cas. Ins. Co. v. J & J Maint., Inc., 133 F.Supp.3d 852, 863-64 (W.D. La. 2015). Thus, § 5001 adopts and incorporates current Mississippi law governing personal injury actions. Vasina v. Grumman Corp., 644 F.2d 112, 117 (2d Cir. 1981) (addressing § 5001's predecessor, 16 U.S.C. § 457); Voelkel v. Gen. Motors Corp., 846 F.Supp. 1468, 1473 (D. Kan.), on reconsideration, 846 F.Supp. 1482 (D. Kan. 1994), aff'd, 43 F.3d 1484 (10th Cir. 1994) (same).

         i. Plaintiffs' Tort Claims Fail Because They Do Not Have Expert Evidence of Specific Causation

         Plaintiffs' negligence and gross negligence claims are claims for personal injury caused by their alleged exposure to toxic mold in their leased premises. “Such a claim is one for toxic tort.” Shed v. Johnny Coleman Builders, Inc., 761 Fed.Appx. 404, 406 (5th Cir. 2019). “In any tort case, identifying and proving the source of the harm that proximately caused a plaintiff's injuries is essential.” Smith v. Union Carbide Corp., 200 So.3d 1035, 1041 (Miss. 2016) (quoting Miss. Valley Silica Co. v. Reeves, 141 So.3d 377, 382 (Miss. 2014)). “To establish causation in toxic tort cases, general causation first must be shown, then specific causation. General causation means that a substance is capable of causing a particular injury; specific causation looks to whether the substance caused the specific plaintiff's injury.” Shed, 761 Fed.Appx. at 406 (citing Knight v. Kirby Inland Marine Inc., 482 F.3d 347, 351 (5th Cir. 2007)); see also Curtis v. M&S Petroleum, Inc., 174 F.3d 661, 670 (5th Cir. 1999).

         “Under Mississippi law, actions involving ‘medically complicated' injuries require expert testimony on causation.” Savage v. Pilot Travel Centers, L.L.C., 464 Fed.Appx. 288, 290-91 (5th Cir. 2012); see also Cole v. Superior Coach Corp., 234 Miss. 287, 106 So.2d 71, 72 (1958) (“In all but the simple and routine cases . . ., it is necessary to establish medical causation by expert testimony.”). Plaintiffs' mold-exposure claims allege medically complicated injuries, which require expert testimony on causation.[3] See Curtis, 174 F.3d at 670 (“We recognize that ‘[s]cientific knowledge of the harmful level of exposure to a chemical, plus knowledge that the plaintiff was exposed to such quantities, are minimal facts necessary to sustain the plaintiffs' burden in a toxic tort case.'”); Garrett v. City of Tupelo, Miss., No. 1:16cv197-DMB-DAS, 2018 WL 3341198, at *8 (N.D. Miss. July 6, 2018) (“Causation in a mold case is not within common knowledge and expert medical testimony will be required to establish general and specific causation.”); Ingram v. Guideone Mut. Ins. Co., No. 2:06cv117-KS-MT, 2007 WL 4165361, at *5 (S.D.Miss. Nov. 19, 2007) (“In order to prevail on their claims for physical injury, the plaintiffs must demonstrate ‘by a reasonable medical probability through expert testimony that [their] alleged injuries were caused by mold exposure.'”); Childers v. Ill. Cent. R.R. Co., __ So.3d __, 2019 WL 2428777, at *2 (Miss. Ct. App. June 11, 2019) (“The causal link between a cancer diagnosis and exposure to harmful toxins, however, often requires the expertise and knowledge of a medical expert.”).

         Plaintiffs offer the testimony of two experts. However, neither provides evidence of specific causation. Joe E. Morgan is a contractor with significant construction and construction-consulting experience. His opinion is that defects in the way the HVAC system was installed in Plaintiffs' residence caused moisture issues, and Defendants took too long to address these moisture issues.[4] (See Morgan Report, ECF No. 206-1; Morgan Depo. 50, ECF No. 206-2 (ECF pagination).) Mr. Morgan's opinion cannot establish general or specific causation for Plaintiffs' mold-exposure claims. Dr. Paul Goldstein, Ph.D. is a professor of genetics and toxicology in the Department of Biological Sciences at the University of Texas, El Paso. Dr. Goldstein opines that the Yarbroughs have experienced symptoms - chest pain, sinusitis, congestion, respiratory problems, rhinitis, fatigue, headache, rash, allergic reaction, dermatitis, nausea, vomiting, and cough - consistent with exposure to toxins released by Aspergillus and Penicillium mold spores found in their residence. (See Goldstein Report 3-5, ECF No. 216-1.) He also offers his conclusions that Plaintiffs' exposure to these toxins more likely than not caused their symptoms. (Id. at 5.) However, the Court has determined in a separate, concurrently-entered Memorandum Opinion and Order that this second opinion - which concerns specific causation - must be excluded as unreliable under Federal Rule of Evidence 702.

         Dr. Goldstein is prepared to state that the symptoms collectively experienced by members of the Yarbrough household are consistent with the symptoms caused by exposure to toxins released by Aspergillus and Penicillium mold spores. He did not determine that the specific mold(s) to which individual plaintiffs were exposed caused the specific symptoms they experienced. He acknowledges that the testimony of a medical doctor is required in order to determine whether any individual person suffered symptoms caused by exposure to mold. The only medical expert opinion offered in this case is that of Dr. Chelle P. Wilhelm, M.D., the Rule 35 medical examiner.[5] Dr. Wilhelm clinically examined each of the Yarbroughs, reviewed their medical records, and concluded “to a reasonable degree of medical certainty” that the Yarbrough's documented and reported symptoms were not caused by exposure to mold in their home at Keesler. (Wilhelm Rule 35 Reports 6, 24, 36, 55, 65, ECF No. 229-20.)

         Dr. Goldstein's admissible opinion evidence establishes general causation - that the mold to which Plaintiffs were exposed could produce the symptoms they experienced - but that is all. Plaintiffs' mold-exposure claims require expert evidence on both general and specific causation, but Plaintiffs point to no additional expert medical evidence in the record. In fact, the only medical evidence offered by either party establishes that exposure to mold was not the cause of Plaintiffs' injuries. Without an issue of fact as to specific causation, the Court must grant summary judgment for Defendants on Plaintiffs' negligence and gross negligence claims. See Shed, 761 Fed.Appx. at 407 (“Shed's doctors observed that the injuries were consistent with mold exposure without concluding that mold was in fact the cause. Therefore, Shed had failed to produce sufficient evidence to create a material issue of fact that the mold in his rental unit caused his physical injury.”) (emphasis in original).

         ii. Plaintiffs' Civil Conspiracy Claim Fails Because They Cannot ...

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