6th Circuit Directs District Court to Revisit Derivative Governmental Immunity Decision

On June 2, the U.S. Court of Appeals for the Sixth Circuit decided the case of Adkisson v. Jacobs Engineering Group, Inc.. The Court of Appeals reversed the federal district court’s dismissal of lawsuits premised on the argument that Jacobs Engineering Group, Inc. was entitled to derivative governmental immunity based on its contractual relationship with a government entity protected by the Federal Tort Claims Act, directing the district court to its decision. The Court of Appeals noted that the extent of immunity for government contractors has been debated by the courts of appeals, suggesting that the Supreme Court may want to take another look at some of its rulings in this area.

In December 2008, a coal ash containment dike operated by the Tennessee Valley Authority (TVA) at its Kingston Fossil Fuel Plant failed, spilling approximately 5.4 million cubic yards of coal ash sludge over 300 acres. TVA, an agency of the federal government, responded to this catastrophe in accordance with the Superfund or Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) and EPA’s National Contingency Plan. Jacobs was engaged to serve as the TVA’s prime contractor for remedial project planning, management and oversight. Jacobs prepared a comprehensive Site Wide safety and Health Plan, which addressed such matters as health-hazard monitoring and training.

In 2013, several personal injury lawsuits were filed against Jacobs by former employees who basically alleged that Jacobs’ negligence and careless conduct exposed them to injuries and emotional distress, for which they are seeking compensatory and punitive damages. The federal district court dismissed these lawsuits, agreeing with Jacobs that it was entitled to derivative governmental immunity based on its contractual relationship with a government entity protected by the Federal Tort Claims Act. As noted above, the Court of Appeals disagreed.