Military base pesticide exposure case belongs in state court - 9th Circ. - Reuters

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A U.S. MV-22B Ospreys aircraft takes off from Marine Corps Base Hawaii, U.S. on April 19, 2017. Courtesy Aaron S. Patterson/U.S. Marine Corps/Handout via REUTERS

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• Companies
• Law firms

• Federal, state governments share concurrent jurisdiction over Navy base in Hawaii, court found
• Ruling is a win for military families who rented housing on the base

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(Reuters) - A federal appeals court ruled Monday that military families that allege they were kept in the dark about pesticide contamination on a Hawaii Navy base can pursue their claims in state court, reviving their lawsuit against companies that rented homes to them on the base.

In a win for the families, a unanimous panel of the 9th U.S. Circuit Court of Appeals reversed a lower court ruling that had denied their bid to remand the case. The panel reasoned that under the statute that admitted Hawaii as a U.S. state, Honolulu shares jurisdiction with the federal government over the Marine Corps Base Hawaii (MCBH) on the island of Oahu.

Kyle Smith, who represents the tenants including Kenneth Lake, said that "we are pleased that Hawaii state courts will have the opportunity to rule on these important issues of Hawaii state law."

Randall Whattoff of Cox Fricke, who represents real estate company Ohana Military Communities (OMC) LLC and co-defendant Forest City Residential Management Inc, said OMC disagreed "with the determination that the federal courts lack jurisdiction to consider matters occurring on a Marine Corps facility." The company intends to seek a full review of the ruling, he added.

Lake and other military family members who leased homes from the companies sued them in Hawaii state court in 2016. The plaintiffs alleged the companies, who they say jointly built and operated the private housing at the base, failed to inform their tenants that MCBH's soil was contaminated with chlordane and other pesticides. The contamination exposed the families to unsafe conditions including higher risks of cancer, they say.

Chlordane used to be applied to home foundations to control termites. It was banned in 1988.

OMC confirmed the pesticide contamination and developed a plan to mitigate its risks, the complaint says. Mitigation measures included drawing maps detailing where pesticide-contaminated soils had been found, and requiring that no "visible dust" be emitted during demolition and construction activities, it says.

The companies in 2016 removed the lawsuit to federal court. There, U.S. District Judge Leslie Kobayashi over the course of several rulings denied the residents' motion to return it to state court, and dismissed all but one of their 11 claims. They ranged from breach of contract to violations of the state's landlord-tenant code. The plaintiffs appealed in 2019.

Writing for the 9th Circuit panel, U.S. Circuit Judge Ryan Nelson wrote that under the Admission Act, which officially made Hawaii the 50th state, the United States and Hawaii have "concurrent" jurisdiction over the military base, subject to an exception: areas Washington has designated as critical fall under its exclusive jurisdiction.

"We have not found evidence that MCBH is such a designated 'critical area,'" Nelson wrote.

"Hawaii's concurrent jurisdiction means state law governing plaintiffs' state claims is still Hawaii law – not federal law," he wrote.

The judge, who was joined by Senior U.S. Circuit Judge Richard Clifton and U.S. Circuit Judge Daniel Collins, also disagreed with the lower court's conclusion that federal jurisdiction prevailed, despite the concurrent jurisdiction, because the dispute involved "substantial federal interests."

And the panel rejected the companies' argument that the case belonged to federal court under the federal-officer removal statute because OMC had acted as a federal officer by providing housing services at the behest of the Navy.

The case is Lake v. Ohana Military Communities, 9th U.S. Circuit Court of Appeals, No. 19-17340.

For Kenneth Lake et al: Kyle Smith of Law Office of Kyle Smith

For Ohana Military Communities et al: Randall Whattoff of Cox Fricke

Sebastien Malo

Sebastien Malo reporters on environmental, climate and energy litigation. Reach him at sebastien.malo@thomsonreuters.com

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