Lawsuit over fatal propane explosion at Iowa home settles

Former Lutheran pastor now handles propane cases

St. Paul attorney Gregory N. McEwen has only been practicing law since 1997, the same year of his first propane case. Law is a second career for McEwen, who was previously a Lutheran pastor.

McEwen told Minnesota Lawyer that he started taking the propane cases with a lawsuit that no one else seemed to want. The case, which took place in the Bemidji area, involved two individuals who were intoxicated at the time of the explosion. The plaintiffs also happened to be American Indians, and there was some concern about the potential for juror prejudice.

It was at this time that McEwen first began working with Iowa attorney Donald Beattie, whom McEwen describes as “the best-known propane lawyer in the United States.” The lawyers were able to get a “very substantial” settlement for the plaintiffs, according to McEwen.

After the Bemidji case, McEwen was referred another case that three law firms had turned down. The injured plaintiffs there were impoverished residents of the White Earth reservation who were using propane in their homes. That case resulted in a high six-figure recovery, he said.

McEwen’s father, Neil McEwen, who is also an attorney, works with his son. Debra H. Mande joined the now three-person firm about a year ago.

When an Iowa attorney needed help to represent some of the victims in a catastrophic house explosion in which seven people were killed, he looked over the border to a Minnesota firm with which he had worked successfully in the past.

Attorneys Gregory N. McEwen and Debra H. Mande work at a three-lawyer firm in St. Paul that is one of the few law firms in the country that concentrates its practice on lawsuits arising out of propane explosions. Working with local counsel, McEwen and Mande helped the Iowa plaintiffs settle their case earlier this month.

Although the settlement amount is confidential, the Des Moines Register recently stated that the case likely settled for as much as $20 million. If so, the case reportedly represents the largest personal injury settlement in Iowa history.

Fatal explosion

On Labor Day in 1999, 15 people were gathered at the home of Jerry and Juanita Usovsky of Richland, Iowa. The day before, Jerry Usovsky had been building a dog pen in the yard and apparently struck a propane line. Experts theorize that the propane then leaked from the line through the ground into the house.

In its natural state propane is colorless and odorless. To provide a warning of leaks and other potential propane dangers, suppliers add an odorant. However, McEwen observed: “The warning agent doesn’t always warn. It fades. It’s called odor fade and it is commonly known in the industry. The propane companies acknowledge it in their own consumer literature.”

One of the most common reasons for odor fade is that the propane has leaked into the ground. Because it is heavier than air, it will go to the lowest spot, which in this case was the basement where the party was being held.

McEwen said that the 15 people at the party were sitting in a “propane sea.” He added that the immediate trigger of the explosion is unknown.

“People blew into the yard,” McEwen said. “They were blown out of the house like a bomb [had gone off]. One child was killed, and the [other six] deceased were adults.”

McEwen observed that many of the people who were killed did not die instantaneously.

“They were alive [after the explosion],” he stated. “They were calling out [until] they eventually stopped. The survivors heard the screams. Fortunately, the young girl died right away.”

The deceased included the daughter, wife, sister-in-law, mother-in-law, and father-in-law of the man who was building the dog pen.

The remaining eight guests at the party suffered burns, some quite severe. Two of the women who were burned were cosmetologists in their mid-40s. The women were burned over 60 percent of their bodies, including their faces. Each had medical bills of over $800,000 at the time of the lawsuit.

“It turns your stomach — and that’s what made this case so significant,” said McEwen. “It was a hard case for me to work on because there was so much suffering all the time. Everybody was struggling with that suffering.”

The plaintiffs sued the homeowners and the various companies in the supply and distribution chain responsible for the propane and pipeline that is on the homeowners’ land. The homeowner and the retail distributor settled within six months of the lawsuit for $6.2 million and the rest of the cases settled at various times ranging from about a month before trial to the second day of jury selection.

According to McEwen, the jury selection was going very well for the plaintiffs, and that helped bring the final defendant to the table.

“We had a nurse who said she had heard about the explosion and seen the pictures and remembered it, that she understood that the amount of pain and suffering there was and she didn’t feel she could be impartial,” McEwen recalled. “She started tearing up. The judge had her removed for cause, but the interesting part is 50 people in the room heard that. That’s the kind of stuff that helps the defendant see a different value than they originally thought.”

Procedural twists

There were many procedural twists and turns in the case but there were no particularly novel legal theories, according to McEwen. Typical product liability theories such as failure to warn about the deficiencies of propane and failure to warn customers to use propane gas detectors formed the basis of the case, he said.

Mande noted that the defendant appliance manufacturers brought motions for summary judgment alleging they had no duty to warn about the fuel being used.

“That was a little bit unusual,” she said. “The court agreed that the fuel was an inherent part of the use of the product.”

One pretrial ruling by the judge resulted in two interlocutory appeals. The trial court judge ruled that the jury would not be asked to assess the fault of Jerry Usovsky.

“That [ruling was based on] Weyerhauser v. Thermogas, an Iowa Supreme Court case,” McEwen said. “The lawyers on the losing end of that case were also on this case. They took two interlocutory appeals within the last week before trial.”

The Iowa Supreme Court refused to review the case, but three days before trial the defense made another motion to the Iowa Supreme Court for another interlocutory appeal, essentially a reconsideration of the first decision said McEwen.

“The defense argued that because of the magnitude of the case it warranted extraordinary attention,” he explained. “The Supreme Court immediately denied it on a Friday. The defendants wanted to delay the trial, but the court was watching this case closely enough that it immediately made a decision that the trial goes forward the following Monday.”

McEwen believes that propane cases generally go to trial (if not all the way to verdict) more often than other civil cases.

“Out of the last 15 propane explosions I’ve worked in, we’ve tried six of them,” he said. “Not all of them have gone to verdict, but they’re ready. They’ve settled in trial. It’s the nature of the amount of money we’re asking for. Additionally, often there are multiple defendants.

We’ve usually settled with maybe two or three defendants [earlier] and other defendants remain on trial. By that time, often the clients’ interest in the settlement has dwindled. Sometimes they get significant money [from one defendant] before going to trial so that adds a different dynamic than if it’s a week before trial and they don’t have any money. I’m not saying they won’t settle because often they settle at trial, but we tell the clients up front they have to look at it as a case that will be tried. If they don’t want to do that, we don’t retain them as clients. You’ve got to work up every case like its going to trial or you won’t get full recovery.”

The defendants don’t stick together and hold out until trial because the downside is so huge for them, he explained.

“Everybody in the jury box knows that a person didn’t get burned and incur $500,000 in medical bills because they want to get money,” McEwen observed. “They’re not lying. All those issues that sometimes plaintiffs deal with, we don’t have. The question is, if we can prove liability, which we can because the industry’s already acknowledged an issue with odor fade, how much is this jury going to award this person? … A $3 [million] or $4 million verdict or more wouldn’t be unusual.”

Post-Sept. 11, defendants have been more willing to settle sooner, according to McEwen. “Since Sept. 11, I think we’ve settled most of our cases. If anything, I think the value of our cases is higher.”

McEwen pointed out that even the treatment for burns is painful. The process of debridement treatment for burns involves peeling off the skin, down to where it’s bleeding. When the skin is pulled off in a scrub tank, it draws tears from people’s eyes.

“I’ve had clients say in all sincerity that they would rather die than go in the scrub tank,” McEwen said. “They give them morphine, but it doesn’t dull the pain. I’ve had clients testify that the scrub tank was at least as horrible as the burn. But the doctors say the scrub tank saves their lives because if you don’t get rid of the dead skin infection sets in.”

The defense does not want testimony about the treatment to get in front of jurors, McEwen said.

Electronic gadgetry

McEwen and his Iowa co-counsel, Donald Beattie of Pleasant Hill, had planned to use at trial day-in-the-life videos of the two severely burned women. They also prepared a video designed to show how easily the defendants could have warned customers about propane.

“That cost us $25,000, but it was well worth it,” he said.

The courtroom was full of electronic “gadgetry,” said McEwen, and a technician to run it. (They weren’t going to trust themselves, he joked.) The defense did the same. “It was a well-financed trial,” McEwen said. “Part of that is that in a case of this magnitude, the jury thinks of it as significant when they see all this stuff in the courtroom.”

The amount of expense incurred by both sides was “phenomenal” — and it was really a burden at times for the plaintiffs to keep up with the expenses, McEwen said. There were seven liability experts, in addition to the medical experts.

“On a case like this it wouldn’t be unusual to spend $300,000,” McEwen said, adding that a typical propane case costs about $75,000 to $100,000 to try.

“The recoveries are large but the risk is also large,” McEwen stated. “An average recovery would be $750,000 to $1.5 million. So in a typical case, the costs are about 10 percent of the verdict or settlement. In this case, they weren’t as high as 10 percent.”

Minnesota Lawyer – April 29, 2002 – By Barbara L. Jones