Gaylord to sue Corps over 2010 flooding

10:53 AM, Apr 30, 2012   |    comments
Flooding in Nashville, courtesy: Knox Volunteer Rescue Squad
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By G. Chambers Williams III | The Tennessean

Gaylord Entertainment plans to file a lawsuit today against the federal government, alleging U.S. Army Corps of Engineers and National Weather Service negligence led to major damage to its luxury hotel during the Cumberland River flood two years ago.

The suit will contend that the Corps was negligent in opening the spillway at the Old Hickory Dam on May 2, 2010, and the Weather Service failed to notify the public that water levels would reach the 100-year flood levels that devastated homes and businesses.

A.O. Smith, an Ashland City manufacturer, will join Gaylord as a plaintiff in the federal lawsuit. Its plant was closed for at least three weeks as a result of the flood, which destroyed equipment and ravaged nearly $20 million of inventory.

Gaylord wants $250 million for damages to its Gaylord Opryland Hotel and the Grand Ole Opry House, and A.O. Smith will seek $76 million because of damage to its water heater plant in Ashland City, said Nashville lawyer Bob Patterson, who is overseeing the legal action.

"There's no question that the reason 'Nashville flooded on Sunday, May 2, is because the Corps opened the spillway at Old Hickory Dam," Patterson said. "The discharges on Sunday were so high they caused the Cumberland River to rise above the 100-year flood plain and cause all this damage.

"The second part is that the National Weather Service has a duty under the law to tell the public how high the water is going to get," he said. "They didn't do that."

Gaylord and A.O. Smith filed initial claims with the Corps and the Weather Service for compensation in October, a requirement under the 1946 Federal Tort Claims Act, which governs how legal action can be filed against the federal government.

Once the two agencies rejected the Gaylord and A.O. Smith claims, the companies were free to file a lawsuit but had to endure a six-month waiting period.

"It's a simple fact that we incurred millions of dollars in damages because the Corps released so much water into the Cumberland River," Gaylord spokesman Brian Abrahamson said. "We have a fiduciary responsibility to our shareholders to seek remuneration for the losses we sustained as a result of this negligence, and also to ensure that both parties make significant process improvements to prevent a man-made disaster from occurring in any future flood event."

Similar claims have been made with mixed results against the Corps in lawsuits spawned by major damage in New Orleans in 2005 during Hurricane Katrina.

Winning a case against the Corps is a long shot, attorneys say, mainly because of tort claims exemptions in the federal Flood Control Act that largely exempt the Corps from liability.

One big obstacle is that discretionary decisions made by government agencies are exempt from lawsuits even if they are deemed negligent.

Katrina case could provide a chance

Cape Girardeau, Mo., lawyer Michael Ponder said that's why he didn't file a lawsuit against the Corps last year on behalf of a group of farmers whose land was inundated when the agency blew up a Mississippi River levee to avoid severe flooding upstream.

Blowing up the levee was credited with saving Cairo, Ill., but it also ended up inundating thousands of acres of farmland and destroying at least two small towns downstream.

Ponder chose a different approach on behalf of his clients, but he theorizes that the rule giving the federal government "absolute immunity for any act committed negligently, including blowing up our levee," might blunt legal action in the Gaylord and A.O. Smith situations as well.

"You have a navigable waterway going through Nashville," he said. "As a matter of legal theory, I don't understand how the Flood Control Act doesn't knock their suit out. But maybe I'm missing something."

One legal opening might exist, though, if an ongoing lawsuit linked to Hurricane Katrina in New Orleans in August 2005 holds a clue.

In that case, a federal judge has ruled in favor of a group of people whose homes were flooded in suburban New Orleans, opening the way for what could be thousands of other claims -- and an estimated $20 billion in damages -- if a probable U.S. Supreme Court appeal hearing upholds the lower court sometime in the next 12 months.

The contention in southern Louisiana was that the Corps mismanaged and didn't properly maintain the man-made Mississippi River ship channel (the 1960s-era Mississippi River-Gulf Outlet), and that caused a significant portion of post-Katrina flood damage to homes and businesses.

The court defined the ship channel as a navigation device and not directly related to flood control systems.

New Orleans U.S. District Judge Stanwood Duval's ruling against the government has already been upheld by a unanimous vote of a three-judge panel of the U.S. Fifth Circuit Court of Appeals. It will be reheard by the full Fifth Circuit and would then go to the Supreme Court.

"Suing the Corps is a very daunting task," said Jonathan Andry, a New Orleans lawyer involved in the Katrina case for plaintiffs. "But I know now that the judicial system as the third branch of government works, and people can get a fair shake. We had three very Republican judges on the appeals court uphold our case. All the judges did what they were supposed to do."

Andry warns, though, that the Nashville plaintiffs could be in for a long, drawn-out battle and may not win.

"They won't be up against lawyers from the Corps and the Weather Service," he said. "They are from the Justice Department. And they have shown that they're ready to exhaust all appeals available to them, even if it takes 20 years."

Patterson, the attorney representing Gaylord, said he believes Andry's New Orleans case might actually pave the way for the Nashville suit to succeed.

"There are some exceptions (to immunity) under the Flood Control Act, and the Katrina case has shown that," Patterson said. "One set of plaintiffs in New Orleans won, another lost. So, there is good news and bad news there."

Gaylord's lawyer said the Middle Tennessee case has some important nuances.

"What we have here is distinguishable from Katrina in that we have a failure to enact flood-control procedures," he said. "It is a suit because the Corps failed to do anything in advance of a forecast rainfall of 8.8 inches. We think we at least have an argument that the court ought to hear."


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