(CN) - Louisiana hurricane victims who were housed in dangerous, formaldehyde-tainted trailers cannot sue the government for negligence, the 5th Circuit ruled.
After Hurricanes Katrina and Rita destroyed thousands of homes along the Gulf Coast in 2005, the Federal Emergency Management Agency contracted private businesses to immediately construct and provide thousands of travel trailers as temporary shelter for residents of Louisiana, Texas, Mississippi and Alabama, until other housing became available.
FEMA trailers were available at no cost to residents for use as temporary emergency housing from September 2005 until May 2009. Applications for receiving the trailers notified residents that the units were intended for temporary use and that applicants were required to accept alternative housing options as they became available.
Seven months in, FEMA began receiving complaints from trailer occupants about formaldehyde odors inside the units. Formaldehyde is a chemical substance commonly found in construction materials such as plywood, particle board, home furnishing and fabrics. According to the International Agency for Research on Cancer, it is a known human carcinogen. The Environmental Protection Agency classifies it as a probable human carcinogen.
FEMA encouraged these early complainants to ventilate the trailers by opening the doors and windows. In June 2006, FEMA prepared an informal brochure informing trailer occupants of the dangers of formaldehyde exposure, encouraging them to ventilate their units and urging them to seek medical help if they developed health problems related to formaldehyde.
The EPA partnered with the FEMA on the issue in September 2006, and more than 200 occupants complained about formaldehyde by the end of the year.
Lawsuits over the condition soon racked up, and the U.S. Judicial Panel on Multidistrict Litigation consolidated all the cases and assigned the matter to Louisiana's Eastern District.
The master 2008 complaint alleged that, between March and June 2006, FEMA harmed trailer occupants by placing litigation concerns ahead of their safety. It said the agency exposed them to trailers FEMA knew to contain dangerous levels of formaldehyde, without warning them of the dangerous nature of the units or remedying those units' dangers.
Though FEMA knew about formaldehyde levels in trailers between March and June 2006, it allegedly failed to respond to occupants' concerns as part of a deliberate effort to avoid liability for future formaldehyde exposure claims and litigation. The plaintiffs also claimed that FEMA ignored and manipulated federal scientists' concerns to forestall negative publicity and legal liability.
The District Court dismissed the claims in three separate orders, and a three-judge panel with the New Orleans-based federal appeals court affirmed as to the Louisiana plaintiffs on Tuesday.
Last year, a separate panel affirmed dismissal of the claims of Mississippi and Alabama residents.
Citing that opinion, the panel concluded Tuesday that the negligence claims brought by the Louisiana plaintiffs fall under the discretionary-function exception of the Federal Tort Claims Act (FTCA), which bars the waiver of sovereign immunity for discretionary acts or decisions.
"With the understanding that FEMA was only supplying temporary housing, and based upon the express preference of state and local officials to allow people to remain near their houses, FEMA made the policy judgment that providing travel trailers was the best response to the immediate housing crisis," according to the unsigned decision.
Likewise the plaintiffs failed to show that FEMA negligently responded to the formaldehyde complaints.
"Under the FTCA, 'the government can only be held liable to the extent that a private individual or a business entity could be held liable under similar circumstances under the laws where the act or omission occurred,'" the opinion states.
Here the Louisiana Good Samaritan provision of the Louisiana Homeland Security and Emergency Assistance and Disaster Act negates negligence liability for an individual "who, (1) voluntarily, (2) without compensation, (3) allows his property or premises to be used as shelter during or in recovery from a natural disaster," the judges added.
The gross negligence claims meanwhile qualify for the misrepresentation exception of the FTCA, which covers, among other things, "any claim arising out of ... misrepresentation, deceit, or interference with contract rights."
"Claims of gross negligence for FEMA's alleged material omission of the formaldehyde risk fall under the misrepresentation exception," the opinion states. "According to the plaintiffs, FEMA's failure to publicize and take action on information it received relating to formaldehyde levels and occupant risk was the proximate cause of the injuries suffered."