In May 2012, a catastrophic flood inundated large sections of Nashville, resulting in many lawsuits being filed against the U.S. Army Corps of Engineers with respect to the Corps' operation of the Old Hickory Dam. The dam is located on the Cumberland River, and water that flows through this river and the Old Hickory Dam eventually reaches Nashville. The several lawsuits that followed were consolidated, and the plaintiffs included A.O. Smith Corporation, Gaylord Enterprises, the Opryland Hotel, the Grand Old Opry, the Gibson Guitar Corporation, other hotels, businesses and insurance companies.
The plaintiffs alleged that the Corps negligently failed to adhere to its flood control protocols, thus exacerbating the property damages caused by the floodwaters. The District Court dismissed these cases, holding that held 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, 28 U.S.C. § 2680(a). 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)." Citing United States v. Gaubert, 499 U. S. 315, 328 (1991).
On December 18, 2014, the U.S. Court of Appeals for the Sixth Circuit affirmed this ruling, holding that discretionary function exception bars the appellants claims, even though the plaintiffs were especially critical of the Corps' decision not warn downstream residents that a large amount of water would be discharged from the dam because of the heavy rains that fell in the area. The case is A. O. Smith Corporation, et al. v. United States. The Court of Appeals confirmed that "[t]he government retains its immunity when the challenged conduct satisfies both parts of a two-part test," and once the first part of the "Gaubert test" has been met, there is a "strong presumption" that the second part is also satisfied. The Court of Appeals concluded that "[t]he Water Manager's conduct satisfies both prongs of the Gaubert test."