In 2014, we covered the United States Supreme Court’s decision in CTS Corp. v. Waldburger et al., 134 S. Ct. 2175 (June 9, 2014).  In Waldburger, the Court overturned a decision by the Fourth Circuit, and held that while CERCLA preempts state statutes of limitations in toxic tort personal injury and property damage actions, it does not preempt state statutes of repose, like the North Carolina statute of repose at issue, from barring similar actions.    Last week, in Stahle v. CTS Corp., No. 15-1001 (March 2, 2016), the Fourth Circuit addressed an even more basic question, whether the statute of repose at issue in Waldburger is even applicable in such cases. 

In Stahle, the plaintiff claimed that he had developed leukemia as a result of exposure to hazardous substances released into a stream nearby his childhood home.  If the ten year statute of repose was applicable, the plaintiff’s claim would be barred without question as the plaintiff’s last possible exposure occurred in 1968, the year his family moved away from this home.  However, permitting the action to go forward, the Fourth Circuit held that a “disease” like the leukemia from which the plaintiff suffers, is not “personal injury” under the statute and therefore the ten year statute of repose does not apply.

The Fourth Circuit’s decision in Stahle overturns the trial court decision of the Western District of North Carolina and is contrary to a 2014 decision of the Eleventh Circuit in Bryant v. United States, No. 12-15424 (October 14, 2014).  Like Stahle, Bryant involved allegations of the development of latent disease that prompted examination of the meaning of the term “personal injury” in the same North Carolina statute.  Importantly, as noted by both the Fourth and Eleventh Circuit courts, North Carolina is the only state without a statutory procedure allowing for a federal court to certify a question of state law to the state’s highest court. 

Waldburger, Stahle, and Bryant all involved the interpretation of North Carolina General Statute § 1-52(16), which currently reads:

Unless otherwise provided by law, for personal injury or physical damage to claimant's property, the cause of action, except in causes of actions referred to in G.S. 1-15(c), shall not accrue until bodily harm to the claimant or physical damage to his property becomes apparent or ought reasonably to have become apparent to the claimant, whichever event first occurs.  Except as provided in G.S. 130A-26.3, no cause of action shall accrue more than 10 years from the last act or omission of the defendant giving rise to the cause of action.

The North Carolina legislature recently amended this section, adding the phrase “[e]xcept as provided in G.S. 130A-26.3,” which alludes to a new exception provided for groundwater contamination.  There is some question regarding the retroactivity of this provision, however (see generally Bryant at 13-15), and this new exception was not addressed by the Fourth Circuit in Stahle.  The issue over which the Western District of North Carolina, the Eleventh Circuit, and the Fourth Circuit disagree is whether this statutory section applies to claims involving latent disease, or only to claims involving latent physical injury.  The dispute can be distilled down to the meaning, or ambiguity, of the term “personal injury” in the first line of the section. 

In holding that the statute does apply to disease, the Eleventh Circuit found that the statute was unambiguous in its application, as “on its face, the text of the statute contains no exception for latent diseases, and no other North Carolina statute excepts latent diseases from the statute of repose.”  Bryant at 5. 

The Fourth Circuit, on the other hand, relied on its own 1986 decision, Hyer v. Pittsburgh Corning Corp., 790 F.2d 30 (4^th Cir. 1986), in which it stated its “understanding that ‘the North Carolina Supreme Court does not consider disease to be included within a statute of repose directed at personal injury claims unless the Legislature expressly expands the language to include it.’”  Stahle at 7.  In his concurrence, however, Judge Thacker pointed out two key issues with the majority’s reasoning.  First, the court in Hyer was charged with interpreting a different North Carolina statute and it relied on a 1985 North Carolina Supreme Court decision that addressed the term “bodily injury,” not the term “personal injury” that appears in the statute at issue today.  Id. at 36.  Second, Judge Thacker questioned North Carolina courts’ approval of the Fourth Circuit’s logic in Hyer, noting that since itwas decided in 1986, no North Carolina state court has relied on itin any published opinion.  Id. at 37.  Indeed, while it is unclear exactly how many other states may interpret the term “personal injury” to exclude disease, other courts have remarked about the Fourth Circuit’s apparently strained reading of the term in Hyer.  See, e.g., Klein v. DePuy, Inc., 506 F.3d 553, 558 (7^th Cir. 2007) (“We, of course, carefully consider the opinions of our sister circuits, … [b]ut with all due respect here, we cannot follow the Fourth Circuit on this issue.” (internal citation omitted)).

This split between the Fourth and Eleventh Circuits is particularly unique, as it is based purely on conflicting interpretations of the same state law, and neither court was able to petition a North Carolina court to resolve the issue.  Thus, for the time being, the Fourth Circuit’s ruling will serve as an important, plaintiff-friendly interpretation of North Carolina state law while the decision from the Eleventh Circuit will fuel defendants’ arguments that the statute of repose bars such claims.  Until the North Carolina Supreme Court or the North Carolina legislature comprehensively clarifies it, issues associated with North Carolina’s statute of repose are likely to continue to divide some courts.

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