Hostetler v. Johnson Controls, Inc.

Hostetler v. Johnson Controls, Inc.

Opinion

OPINION AND ORDER

This is a putative class action arising out of alleged environmental contamination that originated at a plant formerly operated by defendant Johnson Controls, Inc. The plaintiffs, a number of individuals who own property or reside in an adjacent neighborhood, allege that contamination primarily consisting of trichloroethylene (TCE) entered the groundwater and migrated onto their properties. In 2007, Johnson Controls sold the plant to defendant Tocon Holdings, LLC, which briefly operated a manufacturing facility at the property, and more recently began demolishing the plant, which the plaintiffs argue has caused additional environmental hazards. The plaintiffs filed this action in state court, asserting a number of claims arising under state law on behalf of a proposed class consisting of individuals who have owned, rented, or occupied properties affected by the contamination. After litigating the case in state court for nearly a year, Johnson Controls filed a notice of removal, invoking federal jurisdiction under the Class Action Fairness Act. In response, the plaintiffs moved to remand this action back to state court. They [*3]  argue that the removal was untimely, that Johnson Controls waived its right to remove, and that this case falls within the local controversy exception to the Class Action Fairness Act. For the reasons that follow, the Court denies the motion to remand.

I. FACTUAL BACKGROUND

Johnson Controls operated a plant in Goshen, Indiana from approximately 1937 through 2006, where it manufactured parts for thermostats and building control systems. The plant is adjacent to a residential neighborhood, and is also located near several business properties and Goshen High School. Through most of its operations at the plant, Johnson Controls used TCE—which can cause cancer and other serious illnesses—and other hazardous chemicals as part of its manufacturing process. The plant discharged its hazardous waste into an adjacent creek until 1965, after which it began storing the waste pending off-site disposal. Even then, however, there were a number of leaks and discharges of TCE and other hazardous chemicals into the ground.

In 1991, Johnson Controls began investigating TCE contamination of the soil at and around the plant. In a report dated the following year, its environmental consultant described a plume [*4]  of contamination consisting of TCE and other hazardous chemicals that extended over a mile to the west of the plant. It also sampled the private drinking water wells of two residential homes in the plume and discovered extremely high concentrations of TCE. Over the next four years, Johnson Controls conducted more sampling and installed extraction wells designed to reduce the amount of TCE and other hazardous chemicals migrating underneath the neighborhood. In 1997, Johnson Controls also signed a Voluntary Remediation Agreement with the Indiana Department of Environmental Management, which established timetables for Johnson Controls to investigate and remediate the contamination. The complaint alleges, though, that Johnson Controls continued to operate its extraction wells in an ineffective and ultimately futile attempt to remediate the contamination, and that it failed to completely delineate the boundaries of the plume.

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