In re Channelview Flooding Litigation (No. 01-22-00946-CV; December 31, 2024) arose from lawsuit brought by 125 property owners who allege that the construction of two crude oil pipelines in a utility corridor caused their properties to flood. CenterPoint Energy granted an easement to Oiltanking Houston, L.P. to build the pipelines in CenterPoint’s utility corridor in Channelview. Four years after completion of the project, two plaintiffs filed a putative class action, naming CenterPoint, Oiltanking, and Enterprise Products, who owned the pipeline at that time. Plaintiffs asserted that when Oiltanking and Enterprise refilled the trenches excavated to lay the pipe, they compacted the soil, causing runoff that continually saturated the ground around their homes, damaging sidewalks, driveways, backyards, and building walls and floors. Plaintiffs alleged negligence, negligence per se, negligent hiring, supervision, and training, gross negligence, private nuisance, and fraud by nondisclosure (i.e., CenterPoint knew about the problem but didn’t tell them). Damages included loss of use and enjoyment of their property, diminution of value, repair costs, and punitive damages.

Plaintiffs served a certificate of merit by an engineering expert pursuant to § 150.002, CPRC. Enterprise, joined by CenterPoint objected to the certificate as insufficient and moved to dismiss. Plaintiffs amended their petition several times to add additional defendants, including the pipeline construction contractor, four affiliates of Enterprise and one CenterPoint affiliate. They also filed a second certificate of merit as to the alleged negligence of the construction company and the affiliates. The newly added defendants filed their own motion to dismiss under § 150.002. Plaintiffs dropped their class action allegations in a third amended petition but added a trespass claim without offering a new certificate of merit. While all this was going on, the other 124 property owners filed their own claims against the same defendants, which included the same certificate of merit from the same expert. The expert filed a third certificate incorporating discovery from the original lawsuit. Defendants successfully moved to transfer the cases to an MDL court, then moved to dismiss them for noncompliant certificates. The MDL court denied the motions. Plaintiffs, on the other hand, filed a “master petition” abandoning their fraud claim and dropping Oiltanking and three Enterprise affiliates from the suit. That left Enterprise Ship Channel LP, Enterprise Ship Channel GP, the two CenterPoints, and the construction company in the case.

In an opinion by Justice Landau, the court of appeals ruled that Chapter 150 applied to the case and that Plaintiffs’ certificates were defective as to some but not all of the defendants. First, the court determined that Plaintiffs’ claim arose out of the provision of professional engineering services within the meaning of § 150.002. Plaintiffs argued that they didn’t have to provide a certificate of merit in the first place because § 150.002 only applied to professional architectural or engineering firms and, alternatively, that Defendants could not seek dismissal under that section “because they did not actually provide engineering services” for the project or “identify specific engineers who did.” The court rejected such a narrow reading of the statute, holding that its plain language covered “allegations of action or inaction arising out of the provision of professional services” (citations mottied). It further determined that the statute does not require Defendants “to identify the specific individuals who perform the professional engineering services before moving to dismiss,” and that Plaintiffs’ (multiple) petitions, which alleged negligent engineering, determined whether § 150.002 applies, not Defendants’ answer or motion. Finally, turning to the Occupations Code broad definition of “practice of engineering,” the court had no trouble concluding that Plaintiffs’ allegations regarding “project planning and management and pre-construction measurement and analysis.” They also alleged that Enterprise and CenterPoint breached their duty to “take reasonable actions during the design and construction of the pipeline” to “eliminate damage, nuisance, and/or adverse impact to [the plaintiffs’] property,” much of which clearly involved engineering functions. Plaintiffs, the court held, were required to file compliant certificates of merit.

The court then turned to whether the “one-size-fits-all” certificates Plaintiffs filed comported with the statute as to each defendant. The court observed that the statute “does not allow for collective assertions of negligence” in a certificate, and that it “must be able to determine which acts or omissions should be ascribed to which compnay, or the certificate of merit should opine that both companies were involved in all aspects of the work” (citations omitted). After an examination of the two certificates filed in this case, the court concluded that it couldn’t “ascribe the alleged faults and omissions” to any particular defendant, only to one or more of them on an “and/or” basis. The certificates were thus ambiguous and defective under the statute. As to Plaintiffs’ third amended petition (the one that relief on the previous certificates), it didn’t specify that each defendant was “involved in all aspects of the work, and it alleges some different acts against the defendants.” Consequently, the court held that “because the original and second [] certificates lump the defendants together and go on to list the allegations without any attribution to a particular defendant or statement that all defendants were involved in all aspects of the work [which, by the way, they were emphatically not], something this Court has held improper, the certificates are deficient” (citations omitted).

The court reached a different conclusion regarding the other 124 MDL parties, who submitted a third certificate by the same expert. Here the certificate specifically identified at least some allegedly negligent conduct by CenterPoint (failure to manage Enterprise and its contractor), Enterprise (failure to perform proper pipeline integrity management and risk assessments to protect adjacent properties), and the construction company (failure to provide adequate construction techniques in digging and refilling the trench). But only in the case of the construction company did the certificate “sufficiently separate [the company] from the concern for collective assertions of negligence.” As to CenterPoint and Enterprise, however, the third certificate had the same problem as the first two, that is, lumping together the CenterPoint and Enterprise defendants with specific attribution.

Consequently, the court reversed the trial court and dismissed the original Plaintiffs’ claims against all of the defendants, as well as the MDL plaintiffs’ claims against the CenterPoint and Enterprise entities. It remanded the trial court for a determination of whether the dismissals should be with or without prejudice. Finally, it affirmed the trial court’s denial of the construction company’s motion to dismiss.

This case provides an excellent discussion of the jurisprudence that has sprouted up around Chapter 150, and it’s the first analysis we have seen of a subsequent amendment § 150.002 that requires plaintiffs to separately attribute acts, errors, or omissions to each defendant “where the plaintiff’s complaint included allegations of ‘entirely vicarious’ liability.” But even if a  certificate of merit refers collectively to multiple defendants, it still has to separate the defendants and allege specific theories of direct liability.

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