In the News The Am Law Litigation Daily

Kirkland Wins Ruling Vacating $926 Million Rocky Flats Property Damage Judgment

Two years ago, a federal district court judge in Colorado entered a $926 million judgment in favor of plaintiffs who sued over damage done to their property near the former Rocky Flats nuclear weapons plant outside Denver. It was a long time coming. The judgment came more than two years following the completion of a four-month trial and 18 years after the case was filed.

But now the property owners are back to square one. On Friday the U.S. Court of Appeals for the Tenth Circuit vacated the judgment and sent the case back to the district court.

The case was brought following a raid on the plant in 1989 by the Federal Bureau of Investigation for possible environmental crimes. Under the Price-Anderson Act, the plaintiffs, who included as many as 13,000 Colorado residents, sued Rockwell International, which operated the plant from 1975 to 1989, and Dow Chemical, which operated the plant from 1952 to 1975. They alleged that the two companies negligently allowed plutonium particles to reach their properties and cause damage.

On appeal, the defendants, represented by a Kirkland & Ellis team headed by Christopher Landau, challenged the kind of damages the plaintiffs had to prove to state a claim under the Price-Anderson Act. The appellate panel determined that the plaintiffs had not shown adequate proof of damages at trial. (Former Kirkland partner David Bernick defended the company at trial.)

"In order to prove plutonium-related 'damage to property,' plaintiffs must necessarily establish that plutonium particles released from Rocky Flats caused a detectable level of actual damage to the class properties," wrote Judge Michael Murphy for the panel. "On remand, plaintiffs will be tasked with producing additional evidence that could support a jury's finding that a nuclear incident occurred, in the form of 'loss of or damage to property, or loss of use of property.'"

David Sorensen of Berger & Montague, an attorney for the plaintiffs, said his team was studying the opinion and evaluating its options.

If the judgment had been upheld, taxpayers would have paid the bill, because the Department of Energy, which owned the plant, had agreed to indemnify the companies. Nonetheless, a Dow spokesperson told the Denver Post that the decision vindicates the company's position. "From the outset of this case 20 years ago, Dow has claimed that there has been no harm to property owners and no damage to property values," he said. "Dow's position regarding the health effects has been supported by independent panels and state and federal governmental agencies."

Rockwell, whose defense units were purchased by Boeing in 1996, no longer exists.