Continental Insurance Company v. United States

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 14a0295p.06

UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________

A.O. SMITH CORPORATION, GAYLORD ┐
ENTERTAINMENT COMPANY, OPRYLAND HOTEL │
NASHVILLE, LLC, GRAND OLE OPRY, LLC, │
GAYLORD PROGRAM SERVICES, INC., OPRYLAND │ Nos. 13-5578/5599
ATTRACTIONS, LLC, WILDHORSE SALOON │
ENTERTAINMENT VENTURES, INC., OLH, G.P., >
│
GAYLORD HOTELS, INC. (13-5578); CONTINENTAL │
INSURANCE COMPANY, GIBSON GUITAR CORP., │
HARRIS CORPORATION, OSG SHIP MANAGEMENT, │
INC., CARTERS INC., L-3 COMMUNICATIONS │
HOLDINGS INC., QINETIQ NORTH AMERICA │
OPERATIONS LLC, ABC BUS COMPANIES INC., │
INDEMNITY INSURANCE COMPANY OF NORTH │
AMERICA, TOKIO MARINE & NICHIDO FIRE │
INSURANCE CO., LTD. (US BRANCH), NISSAN NORTH │
AMERICA, INC., METAL ONE HOLDINGS AMERICA, │
INC., FIREMAN’S FUND INSURANCE COMPANY (13- │
5599), │
│
Plaintiffs-Appellants, │
│
v. │
│
│
UNITED STATES OF AMERICA, │
Defendant-Appellee. │
┘
Appeal from the United States District Court
for the Middle District of Tennessee at Nashville.
Nos. 3:12-cv-00429; 3:12-cv-00433—Todd J. Campbell, District Judge.
Argued: March 20, 2014
Decided and Filed: December 18, 2014

Before: BATCHELDER and McKEAGUE, Circuit Judges; OLIVER, District Judge


The Honorable Solomon Oliver, Jr., Chief United States District Judge for the Northern District of Ohio,
sitting by designation.

1
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 2

_________________

COUNSEL

ARGUED: Patricia Head Moskal, BRADLEY ARANT BOULT CUMMINGS LLP, Nashville,
Tennessee, for Appellants in 13-5578. Anthony J. Pruzinsky, HILL RIVKINS LLP, New York,
New York, for Appellants in 13-5599. Alisa B. Klein, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Patricia Head Moskal, Robert S.
Patterson, Edmund S. Sauer, BRADLEY ARANT BOULT CUMMINGS LLP, Nashville,
Tennessee, for Appellants in 13-5578. Keith B. Dalen, Lauren E. Komsa, HILL RIVKINS LLP,
New York, New York, for Appellants in 13-5599. Alisa B. Klein, Mark B. Stern, UNITED
STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee.

_________________

OPINION
_________________

ALICE M. BATCHELDER, Circuit Judge. Appellants in these consolidated cases
contend that the Army Corps of Engineers (“Corps”) negligently failed to follow its flood
protocols in operating Old Hickory Dam, exacerbating the property damage caused by a one-
thousand-year flood event in Tennessee. The district court dismissed Appellants’ claims for lack
of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1), holding that
Appellants’ claims were barred by the immunity provided in the Flood Control Act, 33 U.S.C.
§ 702c, and by the discretionary function exception to the Federal Tort Claims Act (“FTCA”), 28
U.S.C. § 2680(a). We AFFIRM because the discretionary function exception bars Appellants’
claims.

I.

The Cumberland River flows through Kentucky and Tennessee. The river contains ten
dams, one of which is Old Hickory Dam. Old Hickory was built to promote navigation and
electricity. Water that flows through Old Hickory eventually reaches Nashville, which sits in the
bottom of the Central Basin of the Cumberland River.

The reservoir behind Old Hickory can store a significant amount of water, and
conceptually is divided vertically into three pools. The inactive pool occupies the area from the
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 3

bottom of the reservoir up to 442 feet above sea level. The power pool occupies the area from
442 feet to 445 feet. And the surcharge pool occupies the area from 445 feet to 450 feet. If
water exceeds the capacity of the surcharge pool, the dam is in danger of being overtopped and
damaged. The Corps then must accelerate discharges through the dam to prevent it from being
destroyed.

The water level in Old Hickory’s reservoir is generally maintained in the power pool.
Old Hickory’s Water Control Manual (“Water Control Manual”) states that “to enhance
recreational opportunities, it is desirable to maintain Old Hickory in the upper one foot of the
power pool, between elevations 444 and 445.” The surcharge pool is kept empty: “Water is
permitted in the flood surcharge pool only during flood events.” Surcharge storage is intended
only to “replace the natural valley storage lost due to the impoundment of a reservoir.” In other
words,

The loss of valley storage can send flood waters into a reach of river quicker than
would be the case under natural conditions and subsequently cause stages at
downstream points to be higher than would be the case had the project not been
built. These increases in flood depths would be relatively minor, but even minor
increases in flood depths cause an increase in damage. To prevent the Old
Hickory reservoir from causing such an increase in downstream flood depths, the
flood surcharge storage space is used to store this excess water and thus return
downstream flood stages to those that would have existed had Old Hickory Dam
never been built. Thus, no overall improvement in downstream flood stage
conditions are [sic] expected from the flood surcharge storage at Old Hickory.

The “Flood Regulation” portion of the Water Control Manual outlines management
protocols to execute depending on existing or anticipated flood conditions. Although the Water
Control Manual does not provide a trigger for these protocols, it juxtaposes “Flood Regulation”
with “Normal Regulation.” The Master Water Control Plan for the Cumberland River Basin
(“Master Plan”) states that “[r]eal time reservoir management requires a great deal of judgement
[sic] in operation. It is recognized that the demands of water resource management are at times
conflicting and the water control manager must have some degree of operation flexibility.”
There are multiple Corps’ directives relevant to this case, including the aforementioned Water
Control Manual and Master Plan, as well as the Old Hickory Dam Instructions for Reservoir
Regulation Manual (“Reservoir Regulation Manual”) and general Corps Engineering
Regulations.
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 4

First, the Water Control Manual states that

preflood drawdown to elevation 442 is permitted upon direction from the Water
Management Section. Since the pool typically remains in the upper one foot of
the three foot power pool, as desired for recreation, it is doubtful that there will be
sufficient time for the full pool to be emptied by preflood drawdown. . . . A
maximum rate of rise of one foot per hour at Nashville is used to guide preflood
drawdown operations.

Second, the Water Control Manual advises that “releases greater than ‘natural’ flows
should be made at the onset of a flood to conserve storage for the peak.” But this directive is
“[s]ubject to the 5,000 cfs [cubic feet per second] per hour increase limitation” for combined
flows from Old Hickory and the nearby J. Percy Priest Dam outlined in the Reservoir Regulation
Manual.

Third, the Reservoir Regulation Manual states that Corps policy is to “conserv[e] all
surcharge storage” and any storage that could be gained through pre-flood drawdown of the
power pool “until it is clearly evident that the storm has passed.” As the Water Control Manual
puts it, “Flood storage is best used just prior to the peak of the flood to maximize reduction of the
peak outflow from the project.” According to the Reservoir Regulation Manual, the “one
exception to the policy of conserving all surcharge storage” is “[i]f the rise is expected to be
short term, and the reservoir level is projected to not exceed elevation 445.15 . . . .”

And fourth, the Water Control Manual provides that

[i]f the control flow at Nashville cannot be maintained while holding the water
surface within the power pool, then flood surcharge storage is utilized. If the
headwater is rising faster than 0.15 feet per hour, Old Hickory releases are
increased and the Nashville control flow is exceeded, but the increase in
maximum combined spillway releases from Old Hickory and J. Percy Priest is
limited to 5,000 cfs per hour. This operating constraint remains in effect until all
surcharge storage is used, at which time the discharge is increased as necessary to
maintain the water surface at the top of the flood surcharge pool, elevation 450.

The “Flood Periods” provisions of the Reservoir Regulation Manual offer an additional
consideration: “If maximum flows at Nashville cannot be maintained while holding water
surface within the power pool, set the surcharge pool fill rate at or below 0.15 feet per hour,
subject to the 5,000 cfs per hour increase limitation stated below.”
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 5

***

An unprecedented storm swept through the Cumberland River Basin on May 1–2, 2010.
A smaller storm that occurred one week earlier had already saturated the ground. On April 28,
the National Weather Service (“NWS”) predicted rainfall of up to 6.2 inches for the area, a
projection that was increased to 7.8 inches by April 30. Water was kept at its usual depth during
this time—six inches from the top of the power pool—even though the Corps was aware of the
storm forecast. The rain began to fall in the early morning on May 1, and the NWS increased its
regional rainfall projection to 8.6 inches.

The Corps did not increase discharges through the dam until the Corps’ Nashville District
Commander declared a flood emergency at 1:00 p.m. on May 1. According to Appellants, “the
releases were still less than the natural flows from the rainfall and the stormwater runoff draining
into Old Hickory Reservoir . . . .” Appellants’ Br. 15. Forty minutes after the emergency was
declared, the Corps’ Nashville District Water Manager left his office and did not return until that
evening at 7:00 p.m. During his absence, water levels in the Old Hickory Reservoir rose by over
one foot and well into the surcharge pool. The Water Manager then left his office again at 11:00
p.m., not returning until Sunday morning, May 2.

By Sunday morning at 6:00 a.m., before the second round of storms arrived, the water
level had reached 447.75 feet. Over half of the capacity of the surcharge pool had been used
before any rain had fallen from the second round of storms. By 12:00 p.m. on May 2, the water
level had risen to the top of the surcharge pool and the Corps was forced to release massive
volumes of water through the Dam. By 6:00 p.m., the Dam was discharging water at the rate of
212,260 cfs. The Corps never warned downstream residents that it was discharging such an
unprecedented amount of water into the Cumberland River. The discharged waters eventually
reached the Nashville area, breaching levees and destroying and damaging Appellants’ property.

The district court held that the immunity provided to the United States by the Flood
Control Act bars Appellants’ claims because “[l]ooking at the character of the waters, as alleged
in Plaintiffs’ Complaint, and following the guidance set forth in Central Green . . . Plaintiffs’
injury was caused by ‘floods or flood waters at any place.’” Dist. Ct. Op. 8 (citing 33 U.S.C.
§ 702c). As an alternative basis for dismissal, the court held that the discretionary function
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 6

exception to the FTCA bars Appellants’ claims. The district court held that that exception
applies when government employees act pursuant to “general directives as to the goals to be
achieved, and employees maintain discretion as to how and when these directives are to be
implemented” while “consider[ing] multiple policy objectives in determining how and when to
implement the general directives.” Ibid.

II.

We review de novo the district court’s dismissal based on the discretionary function
exception to the FTCA. Kohl v. United States, 699 F.3d 935, 939 (6th Cir. 2012). The
discretionary function exception shields the government from liability for

[a]ny claim based upon an act or omission of an employee of the Government,
exercising due care, in the execution of a statute or regulation, whether or not
such statute or regulation be valid, or based upon the exercise or performance or
the failure to exercise or perform a discretionary function or duty on the part of a
federal agency or an employee of the Government, whether or not the discretion
involved be abused.

28 U.S.C. § 2680(a). The government retains its immunity when the challenged conduct satisfies
both parts of a two-part test. First, the conduct must be “discretionary,” not “controlled by
mandatory statutes or regulations.” United States v. Gaubert, 499 U.S. 315, 328 (1991). Put
differently, the action in question must “involve[] an element of judgment or choice,” rather than
follow a “federal statute, regulation, or policy specifically prescrib[ing] a course of action” and
leaving “the employee [] no rightful option but to adhere to the directive.”1 Berkovitz v. United
States, 486 U.S. 531, 536 (1988). Second, the exercise of discretion must be “the kind that the
discretionary function exception was designed to shield;” id., i.e., it must be “susceptible to
policy analysis,” Gaubert, 499 U.S. at 325. There is a “strong presumption” that the second part
of this Gaubert test is satisfied if a court concludes that the employee was exercising discretion.
Id. at 324. We examine each of Appellants’ challenges using this framework.

1
These “directive[s]” may come from published regulations or even internal agency documents. See
Gaubert, 499 U.S. at 324.
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 7

A.

Appellants argue that the Corps negligently failed to initiate drawdowns of Old Hickory’s
reservoir prior to the storm. The Corps did, however, lower the water level in the power pool by
six inches on April 29, prior to the storm’s arrival. Regardless, the Corps’ manuals and
regulations do not mandate pre-flood drawdown and the Corps’ decision was susceptible to
policy analysis.

The Water Control Manual warns that “[p]reflood drawdown capability is limited by the
quick response of the Cumberland Basin. There is often only hours between a rainfall event and
the increase in project inflows. However, preflood drawdown to elevation 442 is permitted upon
direction from the Water Management Section.” It also says that “surcharge storage and any
additional storage that can be gained by preflood drawdown should be preserved until it is
clearly evident that the storm has passed.” The fact that pre-flood drawdown “is permitted” and
“should be” utilized in some situations does not mean that the Corps must engage in pre-flood
drawdown.

In Montez ex rel. Estate of Hearlson v. United States, 359 F.3d 392 (6th Cir. 2004), we
held that the language requiring the Bureau of Prisons to “provide for the protection” and
“provide for the safekeeping” of inmates was “of a general nature,” id. at 396, as were
regulations that said an inmate “may” be removed from the general prison population for safety
reasons, id. at 397. These regulations “allowed [Bureau of Prison] officials to exercise judgment
when making decisions . . . .” Ibid. As the quoted language from the Water Control Manual
illustrates, the Water Control Manual also uses general, permissive language in describing its
pre-flood protocols.

The relationship among Old Hickory and other nearby dams bolsters this conclusion.
The Corps, according to the Water Control Manual, is required to coordinate Old Hickory’s
releases with releases from J. Percy Priest in order “to limit the increase in combined release[s]
to 5,000 cfs per hour . . . .” Discharges from J. Percy Priest Dam, Old Hickory Dam, and the
275 square mile drainage area “must be considered when developing an operating plan to
achieve a desired flow or a rate of change in flow at Nashville.” And drawdowns cannot exceed
“[a] maximum rate of rise of one foot per hour at Nashville.” Thus, even if pre-flood drawdowns
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 8

were mandatory, the Corps was required to consider a plethora of factors prior to initiating them.
As the Master Plan admits, these constraints create “demands” that “are at times conflicting and
the water control manager must have some degree of operational flexibility.”

In Myers v. United States, 17 F.3d 890, 895 (6th Cir. 1994), we held that the protocols to
be followed by Mine Safety and Health Administration inspectors were “replete with choice.”
All the directives used an “if/then” framework that required the inspectors to make a particular
assessment prior to acting. Although the course of action “must” follow, the decision whether
the antecedent condition exists afforded sufficient discretion to satisfy the first prong of the
Gaubert test. Id. at 896. In this case, the Corps must follow conflicting directives whose
applicability requires assessing dynamic environmental conditions. And the Corps must exercise
“judgment or choice” in assessing these antecedent conditions. See Gaubert, 499 U.S. at 322
(citing Berkovitz, 486 U.S. at 536).

Furthermore, under the second part of the Gaubert test, the Corps’ decision was
susceptible to policy analysis. The Water Control Manual articulates three “primary objectives”
for the dam: “commercial navigation,” “hydropower,” and replacement of the natural valley
storage. The Water Control Manual even states that “to enhance recreational opportunities, it is
desirable to maintain Old Hickory in the upper one foot of the power pool,” the level at which
the power pool was being kept by the Corps prior to the flood event. Appellants concede that the
water level was kept six inches from the top of the power pool in order to facilitate navigation,
Appellants’ Br. 38, a relevant public policy consideration. For Appellants to prevail they must
argue that the Corps is required to ignore other policy considerations in the face of an oncoming
storm. Nothing in the applicable manuals suggests this is so.

Appellants argue that the Corps’ “conduct only involves objective hydrological and
mathematical calculations,” which are not susceptible to policy analysis. Appellants’ Br. 58. In
Myers, 17 F.3d at 895, we asked whether Mine Safety and Health Administration inspectors
were authorized to make safety considerations on the basis of public policy. We held that the
policy balancing had been done by others, and that the inspectors “are not authorized to reweigh
these interests on a case-by-case basis. Rather, they are to determine compliance and, in the
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 9

event of non-compliance, issue the mandatory citations and orders.” Id. at 898.2 But deciding
whether to initiate pre-flood drawdowns requires more than the ministerial application of
objective principles, as was the case in Myers. The Supreme Court rejected this line of reasoning
in Gaubert itself. There, shareholders argued that actions taken by federal regulators “involved
the mere application of technical skills and business expertise.” Gaubert, 499 U.S. at 331. The
Court held that decisions such as replacing corporate management, intervening with state
agencies, and initiating bankruptcy actions for insolvent subsidiaries, see id. at 332–33,
“involved the exercise of choice and judgment,” id. at 331. The Court suggested that only a
narrow class of regulatory actions involve no choice or judgment: “It may be that certain
decisions resting on mathematical calculations, for example, involve no choice or judgment in
carrying out the calculations, but the regulatory acts alleged here are not of that genre.” Id. The
Corps’ actions in this case are not of that genre either. The Corps was required to exercise its
discretion in balancing competing and conflicting directives and policy goals, decisions at the
very heart of the discretionary function exception. The district court did not err by dismissing
Appellants’ pre-flood drawdown claim.

B.

Appellants argue next that the Corps was required to discharge water at greater than
natural flows at the beginning of the storm in order to conserve storage capacity. Appellants’ Br.
45. The Water Control Manual states that “releases greater than ‘natural’ flows should be made
at the onset of a flood to conserve storage for the peak.” Appellants argue that the Corps only
made releases greater than natural flows after Old Hickory was in danger of being overtopped.
Appellants’ Br. 46. But again, the language in which the Water Control Manual gives the
appropriate response to dynamic conditions is less than mandatory: releases “should be made.”
Furthermore, the Water Control Manual says that releases greater than natural flows are subject
to other constraints, including a rate-of-rise ceiling at Nashville: “A maximum rate of rise of one
foot per hour at Nashville is used to guide preflood drawdown operations.” It is also conceivable
that discharges from J. Percy Priest in combination with storm water runoff might, on their own,

2
Appellants also cite Reminga v. United States, 631 F.2d 449 (6th Cir. 1980), in support of their distinction.
Reminga’s analysis, however, we predicated on the operational level/planning level framework rejected by Gaubert.
See id. at 456; see also Gaubert, 499 U.S. at 326.
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 10

exceed the rate-of-rise ceiling, preventing Old Hickory from discharging at greater than natural
flows anyway. In fact, this appears to be what happened. See U.S. Army Corps of Engineers,
May 2010 Flood Event Cumberland River Basin After Action Report at Page 51–52 (“By limiting
the Old Hickory release to 75,000 cfs, an additional 15,000 cfs of channel capacity at Nashville
was reserved for releases from the J. Percy Priest project and the uncontrolled area between Old
Hickory and Nashville.”). The operational flexibility needed to assess these factors demonstrates
that the Corps has discretion. The second prong of the Gaubert test also is satisfied because, as
noted above, the Water Control Manual contemplates that the Corps will balance flood
prevention with other legitimate policy goals, including power generation, navigation, and
downstream conditions. Thus, the district court did not err by dismissing this claim.

C.

Appellants argue that the Corps ignored the “critical and unequivocal” requirement that it
preserve Old Hickory’s surcharge storage pool until after the storm had passed. Appellants’ Br.
46. The district court concluded that even if the Corps was required to preserve Old Hickory’s
surcharge storage, the Corps “is not directed specifically how and when to perform the various
tasks.” Dist. Ct. Op. 8. Although we affirm the district court’s dismissal of this claim, we do not
adopt this reasoning. Corps protocols may fail to specify how and when they are to be
implemented, but the protocols may nonetheless be nondiscretionary as to whether they are to be
implemented. See Navarette v. United States, 500 F.3d 914, 918 (9th Cir. 2007) (“[T]he Army
Corps certainly retained discretion as to how to mark or fence drop-offs, but that does not mean it
retained discretion whether to do so.”).

The Water Control Manual provides that “[w]ater is permitted in the flood surcharge pool
only during flood events.” In addition,

[f]lood surcharge storage is best used just prior to the peak of the flood to
maximize reduction of the peak outflow from the project. . . . If the surcharge
storage is used too soon, there could be no storage space remaining when the peak
arrives.
....
Thus, the surcharge storage and any additional storage that can be gained
by preflood drawdown should be preserved until it is clearly evident that the
storm has passed.
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 11

....

There is one exception to the policy of conserving all surcharge storage
where it is advisable to allow the reservoir to rise above the top of the power pool
prior to the spill. If the rise is expected to be short term, and the reservoir level is
projected to not exceed elevation 445.15, then spillway releases are not required.
....

If the control flow at Nashville cannot be maintained while holding the
water surface within the power pool, then flood surcharge storage is utilized. If
the headwater is rising faster than 0.15 feet per hour, Old Hickory releases are
increased and the Nashville control flow is exceeded, but the increase in
maximum combined spillway releases from Old Hickory and J. Percy Priest is
limited to 5,000 cfs per hour. This operating constraint remains in effect until all
surcharge storage is used, at which time the discharge is increased as necessary to
maintain the water surface at the top of the flood surcharge pool, elevation 450.

The Corps retains discretion as to whether to keep the surcharge pool empty. The Water Control
Manual uses aspirational, goal-oriented language in describing the Corps’ management of Old
Hickory’s surcharge storage. The Water Control Manual says, “Flood surcharge storage is best
used just prior to the peak of the flood . . . . Thus, the surcharge storage and any additional
storage that can be gained by preflood drawdown should be preserved until it is clearly evident
that the storm has passed.” We cannot conclude that this language leaves the Corps with no
choice but to adhere to the protocol. See Rosebush v. United States, 119 F.3d 438, 442 (6th Cir.
1997) (“The relevant inquiry is whether the controlling statutes, regulations and administrative
policies mandated that the Forest Service maintain its campsites and fire pits in any specific
manner. If not, the Forest Service’s decisions as to the precise manner in which to do so would
clearly fall within the discretionary function exemption to the government’s tort liability.”
(citation omitted)).

Appellants rely on language in two of the manual provisions quoted above. First,
Appellants argue that the “one exception to the policy” language means that the policy is
mandatory. The Corps, however, contemplates more than “one exception” to this policy because
the last paragraph quoted above requires using the flood surcharge storage “[i]f the control flow
at Nashville cannot be maintained while holding the water surface within the power pool” even if
this occurs before it is “clearly evident that the storm has passed.” The Corps is again faced with
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 12

conflicting demands, all of which cannot be simultaneously mandatory. Given this scheme, we
must afford, as the Master Plan puts it, a “degree of operational flexibility” to the Corps.

Second, Appellants point to the Corps’ description of the surcharge conservation policy
as an “operating constraint.” Appellants’ Br. 46. Appellants misread this portion of the Water
Control Manual. The “operating constraint” referred to by the Corps is not the policy of
conserving the surcharge pool, but is instead the policy of using the surcharge pool when
“control flow at Nashville cannot be maintained” and “headwater is rising faster than 0.15 feet
per hour.” Thus the operating constraint requires the use of surcharge storage in some instances;
it does not require its nonuse. Appellants are correct that the Reservoir Regulation Manual
instructs that the Corps should “set the surcharge pool fill rate at or below 0.15 feet per hour,”
but this requirement is itself subject to a 5,000 cfs per hour increase in combined discharges from
Old Hickory and J. Percy Priest. And there is a contingency plan if the fill rate cannot be
maintained at or below 0.15 feet per hour. Once again, these “commands” are both contingent
upon observed conditions and, at times, contradictory. When read in context, these guidelines
give the Corps ample discretion to respond to dynamic storm conditions in the way they
conclude is best.

We note, once again, that for Appellants to prevail under prong two of the Gaubert test,
they must show that the Corps was required to ignore numerous other policy considerations at
play (navigation, water quality, power generation) in the face of an oncoming storm. Nothing in
the applicable manuals requires focusing solely on the storm. The district court did not err by
dismissing Appellants’ claim related to its use of surcharge storage.

D.

Appellants contend that the discretionary function exception does not bar their failure-to-
warn claim. The district court did not address this claim when it dismissed this case. We
nonetheless have jurisdiction to consider it because we conclude that the district court implicitly
rejected it. See Ford Motor Co. v. Transp. Indem. Co., 795 F.2d 538, 543 (6th Cir. 1986)
(holding that although the district court failed to address specific counterclaims, the Court was
persuaded that the district court implicitly rejected them).
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 13

Central to Appellants’ failure-to-warn claim is their allegation that the district court
should have permitted jurisdictional discovery related to possible mandatory Corps directives
unavailable in the public realm, specifically Old Hickory’s Emergency Action Plan (“EAP”).
We review for abuse of discretion a claim that a case was dismissed prematurely because
jurisdictional discovery should have been afforded. See Theunissen v. Matthews, 935 F.2d 1454,
1465 (6th Cir. 1991) (“[T]he scope of discovery is a matter committed to the district court’s
sound discretion, and district court rulings on discovery matters are subject to reversal only for
abuse of that discretion.”).

We have observed that the government is “generally shielded from tort liability” in
deciding whether to warn of potential dangers. Edwards v. Tenn. Valley Auth., 255 F.3d 318,
324 (6th Cir. 2001); see also Reetz v. United States, 224 F.3d 794, 797 (6th Cir. 2000).
Specifically, it is the type of decision that “fit[s] within the second prong of the discretionary
function test.” Bell v. United States, Nos. 99-5563, 99-5655, 2000 WL 1720932, at *5 (6th Cir.
Nov. 6, 2000). To the extent these opinions may be read to suggest that failure-to-warn claims
categorically satisfy the discretionary function exception, see, e.g., Rosebush, 119 F.3d at 443
(“[T]he decision whether to warn of potential danger is a protected discretionary function.”), we
decline to endorse that position. This Court must analyze each of Appellants’ claims under the
two-prong Gaubert test. See Graves v. United States, 872 F.2d 133, 137 (6th Cir. 1989) (“This
analysis is basically ad hoc, and depends on the facts of each case.”); Reetz, 224 F.3d at 796
(“[T]he court must conduct a two-part test.”).

First, Appellants have cited no directives in the record before us that require the Corps to
warn downstream residents. Thus, Appellants must show that the district court abused its
discretion in granting the government’s motion to dismiss prior to affording them discovery of
Old Hickory’s Emergency Action Plan (“EAP”). Appellants speculate that the EAP might
contain mandatory directives related to certain procedures for issuing warnings because an EAP
“specifies preplanned actions to be followed” and “contains procedures and information to assist
the dam owner in issuing early warning and notification messages to responsible downstream
emergency management authorities in the event of an emergency.” Pl.s’ Resp. in Opp. to Def.’s
Motion to Dismiss 552 (citing Army Corps of Engineers, Safety of Dams – Policy and
Procedures, Engineering Regulation 1110-2-1156, § 16.1 (Oct. 28, 2011)). But this provision
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 14

does not require these warnings to be broadcast to the public. Furthermore, it only
“recommend[s]” that the EAP include a “detailed communications plan” and “recommend[s]”
including procedures related to the “[d]issemination of warnings by the Corps directly to the
general public in the immediate vicinity of the dam and reservoir.” Id. § 16.6.

Appellants cite to the Army Corps of Engineers Flood Control Operations and
Maintenance Policies, which requires that “an Emergency Notification Procedure . . . shall be
developed in writing to provide for safety of people in the vicinity of the dam . . . .” Engineering
Regulation 1130-2-530, § 2-3 (Oct. 30, 1996). Elsewhere, however, the obligation is couched in
discretionary terms and depends on the conclusions of other federal agencies:

In carrying out water control activities, Corps of Engineers personnel must
recognize and observe the legal responsibility of the National Weather Service
(NWS), National Oceanic and Atmospheric Administration (NOAA), for issuing
weather forecasts and flood warnings, including river discharges and stages.
River forecasts prepared by the Corps of Engineers in the execution of its
responsibilities should not be released to the general public, unless the NWS is
willing to make the release or agrees to such dissemination. However, release to
interested parties of factual information on current storms or river conditions and
properly quoted NWS forecasts is permissible. District offices are encouraged to
provide assistance to communities and individuals regarding the impact of
forecasted floods. Typical advice would be to provide approximate water surface
elevations at locations upstream and downstream of the NWS forecasting stream
gages. Announcement of anticipated changes in reservoir release rates as far in
advance as possible to the general public is the responsibility of Corps of
Engineers water control managers for projects under their jurisdiction.

33 C.F.R. § 222.5(f)(8). Releases of information are “permissible” and such disclosure is
“encouraged.” Thus, even if the EAP happened to contain information on how the Corps should
promulgate warnings, other regulations only encourage or recommend their promulgation. We
cannot conclude that the district court abused its discretion.

Second, although the government has not suggested an actual policy basis for its failure
to warn, the burden is not on the government to do so. Once the first part of the Gaubert test has
been met, there is a “strong presumption” that the second part is also satisfied. Gaubert,
499 U.S. at 324. And actual policy analysis need not have been conducted because the decision
to warn or not to warn must only be “susceptible to policy analysis.” Gaubert, 499 U.S. at 325.
Appellants have not shown how this decision is not susceptible to policy analysis, especially
Nos. 13-5578/5599 A.O. Smith Corp., et al. v United States Page 15

given the necessary budgetary and effectiveness inquiries involved. See Graves, 872 F.2d at 137
(noting that determination “about what type of warnings were [sic] effective and cost-justified”
was a policy decision); Reetz, 224 F.3d at 797 (describing budgetary considerations as an
example of policy analysis). The district court did not abuse its discretion by closing discovery,
and did not err by dismissing Appellants’ failure-to-warn claim.

E.

Finally, Appellants’ negligent abandonment claim is also barred by the discretionary
function exception. The district court did not explicitly address Appellants’ claim that the
Corps’ Nashville District Water Manager negligently abandoned his post during the storm. We
have jurisdiction to review this claim because we conclude that it was implicitly denied. See
Ford Motor Co., 795 F.2d at 543.

The Corps’ Nashville District Water Manager left the Nashville District office at 11:00
p.m. on Saturday night despite the imminence of the second round of storms. Appellants’ Br. 16,
60. Appellants argue that had the Water Manager been present, water releases could have been
increased throughout the night. Appellants allege that “during the Water Manager’s absence, the
NWS repeatedly tried to contact Corps officials about weather forecasts and discharge
information” but “[t]hose calls went unanswered.” Appellants’ Br. 60.

Appellants, however, do not contend that the Water Manager violated a mandatory
directive by not remaining at his desk for two days and two nights. They focus solely on
whether the alleged abandonment was grounded in public policy, the second part of the Gaubert
test. Ibid. In the absence of a regulation or directive requiring that the Water Manager remain at
his post during the entire flood event, the Water Manager has discretion in that area, meaning
that there is a “strong presumption” that the Water Manager’s conduct meets the second part of
the Gaubert test as well. We have held that decisions concerning “the allocation of limited
agency resources,” Lockett v. United States, 938 F.2d 630, 639 (6th Cir. 1991), “time constraints
and the availability of personnel with experience,” Totten v. United States, 806 F.2d 698, 701
(6th Cir. 1986), and decisions relating to the amount of personnel to assign to a particular task,
Sharp ex rel. Estate of Sharp v. United States, 401 F.3d 440, 446 (6th Cir. 2005), all are policy
considerations that trigger the discretionary function exception. Answering the question whether
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the Water Manager should have remained in his office throughout the storm necessitates similar
policy balancing. The Water Manager’s conduct satisfies both prongs of the Gaubert test. The
district court did not err by dismissing Appellants’ negligent abandonment claim.

III.

For the foregoing reasons, we AFFIRM the district court’s dismissal of Appellants’
claims.