The following is a summary review of articles from all over the nation concerning environmental law settlements, decisions, regulatory actions and lawsuits filed during the past week.  These were all first posted, in abbreviated form, on http://twitter.com/smtaber.  This Newsletter also appears as a post on our website on our blog, The Environmental Law and Climate Change Law Blog.

SETTLEMENTS

Mukilteo, Washington seafood distributor to pay $35,000 for failure to properly report release of ammonia. EPA News Release, June 29th, 2010
The U.S. Environmental Protection Agency reached a settlement with Pacific Seafood Group for its alleged failure to report the release of ammonia from the company’s warehouse and distribution center in Mukilteo, Wash., in a timely manner. EPA announced the settlement today, which includes a $35,000 penalty. The settlement is related to an ammonia release estimated at 210 pounds on May 29, 2009. The Rane Company, which is located next door to Pacific Seafood, notified the Mukilteo Fire Department when their employees detected a strong ammonia odor coming from Pacific Seafood. “When unintended chemical releases occur, every minute counts if it is an emergency,” said Edward Kowalski, Director of EPA’s Office of Compliance and Enforcement in Seattle. “Emergency responders need to be notified promptly to react effectively.”
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Long a sticking point with Superfund lawyers and Superfund defendants, the EPA’s use of the “Uniform Administrative Order” to force companies it believes are in violation of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) to clean up a hazardous waste site was upheld on Tuesday, June 29, 2010, by the U.S. Circuit Court of Appeals for the District of Columbia Circuit. in the case General Electric Company v. Jackson, EPA et al. Case No. 09-5092 (June 29, 2010).

General Electric argued that CERCLA, as well as the way in which EPA administers it, violates the Due Process Clause of the U.S. Constitution when the EPA issues clean-up orders without a hearing before a neutral decisionmaker.  42 U.S.C. 9606. The D.C. Circuit concluded that because the recipient of a clean up order can obtain a hearing in court by refusing to comply with the clean up order, the recipient’s due process rights are satisfied.  This has been the position of the EPA and the courts since the inception of CERCLA.

General Electric went on to argue that CERCLA’s clean up order scheme and EPA‘s implementation of it nonetheless violate due process because the mere issuance of a clean up order can inflict “immediate, serious, and irreparable damage by depressing the recipient‘s stock price, harming its brand value, and increasing its cost of financing.” GE’s argument relied heavily on Ex Parte Young, 209 U.S. 123 (1908), and its progeny.  Under those cases, a statutory scheme violates due process if  “the penalties for disobedience are by fines so enormous . . . as to intimidate the [affected party] from resorting to the courts to test the validity of the legislation [because] the result is the same as if the law in terms prohibited the [party] from seeking judicial [review]‖ at all.”  209 U.S. at 147.

The Court also rejected this argument, concluding that “consequential injuries—injuries resulting not from EPA‘s issuance of the [clean up order], but from market reactions to it—are insufficient to merit Due Process Clause protection.”  The Court pointed to a line of cases interpreting Ex Parte Young to mean that

that statutes imposing fines—even “enormous” fines—on noncomplying parties may satisfy due process if such fines are subject to a “good faith” or “reasonable ground[s]” defense. See Reisman v. Caplin, 375 U.S. 440, 446–50 (1964); Okla. Operating Co. v. Love, 252 U.S. 331, 338 (1920).

Since CERCLA guarantees these safeguards, the Court concluded, GE’s due process rights were not violated.

How will this change things?  Probably not much.  This case is simply the last in a series of efforts by companies rich enough to afford long protracted litigation to attack what seems to be a violation of their property rights.  The issue has always been for corporations that they feel they are being forced to pay for a clean up prior to having their day in court.  The EPA has consistently stated that the purpose of CERCLA is to get action taken on cleaning up a hazardous waste site first, and worry about sorting out who the actual responsible parties are, second.

While GE, as a practical matter, is correct in stating that corporations who have received a clean-up order face a Hobson’s Choice, the legal matter now seems to be settled.  At least until some other lawyer comes up with a novel approach to this issue – or until Congress changes CERCLA.

Noticeably absent in the 74 page EPA Analysis of the American Power Act (also known as “Kerry-Lieberman”), issued on June 15, 2010, is any discussion of the benefits the Act will create.  According to the EPA:

The APA cost estimates do not account for the benefits of avoiding the effects of climate change (or, stated from a different perspective, the no-policy scenario does not include estimates of the costs of climate change induced damages).

There is a more than a little head-scratching going on as to why this might be, since one would think that we Americans wold want our Congresspeople to have a clear understanding of both the the downside and the upside of the legislation.  Even without the benefits factored in the average cost to households of the APA would be between $79 and $146, which includes higher prices for energy consumption and other goods and services, as well as “impacts on wages and returns to capital.”  This puts in the same ballpark as the Waxman-Markey legislation passed last summer by the U.S. house, which came in at a cost of between $80 and $111 per household.

At the time EPA issued its analysis of the Waxman-Markey bill, the Institute for Policy Integrity conducted a benefits analysis and “found that the Waxman-Markey bill would generate between $750 billion and $1 trillion in benefits between 2012 and 2050, dwarfing the costs of the bill.”

Revealing the benefits of the APA might have had more of an impact on the Democrats and “Green-Leaning” Republicans in an attempt to garner their votes for the APA.  Interestingly, although Kerry and Lieberman have attempted to downplay Waxman-Markey’s economy-wide cap-and-trade, the EPA concluded that

While there are important differences between the American Power Act (APA) and H.R. 2454  . . . , the modeled impacts of the APA are very similar to those of H.R. 2454.

  • Estimated allowances prices under the two bills differ on the order of 0-1%
  • The percentage reduction represented by the emissions caps are identical beginning in 2013.
  • Both bills allow for 2 billion tons of offsets in each year.
  • Both bills contain provisions to prevent emissions leakage ad to address competitiveness concerns.
  • The Cost Containment Reserve provisions of the APA provide a greater level of price certainty than do provisions in H.R. 2454’s Strategic Reserve Allowance Program by, among other things, allocating a greater share of allowances to the reserve.  This higher level of price certainty comes at a slightly higher cost to the APA over H.R. 2454.
  • The APA’s approach to cover GHGs from the transportation fuels and refined products sectors does not impact allowance prices.

Since cost has been the opposition’s main argument against any type of climate change legislation, it would stand to reason that the benefits should also be taken into account as well.

Vol. 2, No. 15, June 5, 2010

The following is a summary review of articles from all over the nation concerning environmental law settlements, decisions, regulatory actions and lawsuits filed during the past week.  These were all first posted, in abbreviated form, on http://twitter.com/smtaber.  This Newsletter also appears as a post on our website on our blog, The Environmental Law and Climate Change Law Blog.

SETTLEMENTS

Connecticut Based Landlord Pays Fine for Failing to Warn Tenants about Lead Paint.EPA News Release, June 2, 2010
A Connecticut landlord has agreed to pay a penalty of $2,140 and perform a lead abatement project valued at $20,360 for allegedly violating federal lead-based paint disclosure requirements. These violations potentially put tenants at risk of exposure to lead hazards. In a recent enforcement action, EPA alleged that Michael Perugini violated the federal Lead Disclosure Rule when he failed to disclose information about lead paint to seven tenants when leasing units at his Bristol apartment buildings. Specifically, Mr. Perugini failed to provide records or reports regarding lead hazards, failed to make sure that the lease included a Lead Warning Statement and a statement disclosing the known or unknown presence of lead- based paint, and failed to provide a copy of EPA’s lead hazard information pamphlet to its lessees.

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On May 28, 2010, the U.S. Court of Appeals for the Fifth Circuit issued a rather bizarre decision that left many attorneys scratching their heads.  The appeal by the plaintiffs in the Comer v. Murphy Oil case, in which the plaintiffs alleged that energy companies’ greenhouse gas emissions had caused greater damage from Hurricane Katrina, was dismissed, not on the merits of the case, but based on the arcane procedural rules of appellate law.  With this dismissal of the en banc review of the Fifth Circuit three judge panel decision, there may not be any U.S. Supreme Court review of the issue.

Last October, a three-judge panel of the Fifth Circuit reversed and reinstated the plaintiffs’ claims after the District court had dismissed them on the grounds that the claims involved political questions.  The Fifth Circuit decision coincided with a similar Second Circuit decision in Connecticut v. AEP, which all found that climate change claims could proceed in trial courts.  However, after the Fifth Circuit granted rehearing en banc, most court watchers assumed this was a signal that the Fifth Circuit would reverse itself.  And, if that were to happen, it would set up a classic “conflict between the circuits” review of the issue in the U.S. Supreme Court.

Between the time the court voted for en banc rehearing and the May 28, 2010, decision, one of the six judges who had voted for rehearing declared herself to be recused.  That meant that the court no longer had a quorum left to hear the case.  So, a reasonable person might surmise, the original decision of the three-judge panel would stand as the decision in the appeal.  Not so, the majority opinion said.  Once the court properly voted to rehear the case en banc, the “panel opinion and judgment of the court [is vacated].”  Since there is not a quorum for the court to conduct judicial business, the court cannot reinstate the panel opinion, the majority opinion concluded.  Therefore, the only thing left for the court to do is to dismiss the appeal because there is “no opinion or judgment in this case upon which any mandate may issue.”

There were two dissents filed, both of which outlined other methods the court could have taken that would have avoided the outcome of having an unadjudicated appeal being dismissed, thereby denying the appellants (i.e., the plaintiffs) their right to an appeal to the Courts of Appeal.  Where does that leave the plaintiffs?  The majority opinion says that the parties have the right to petition the U.S. Supreme Court for review.  But review of what?  The District Court decision? Or the Court of Appeals’ decision dismissing the appeal on procedural grounds?

On April 29, 2010, the Tucson- and San Francisco-based Center or Biological Diversity filed a citizen’s suit under the Clean Air Act against the U.S. Environmental Protection Agency alleging that the EPA failed:

to meet numerous deadlines for limiting dangerous pollution from tiny airborne particles. The EPA has violated the Clean Air Act and undermined public health by failing to determine whether areas in five western states are complying with existing air-pollution standards and by failing to ensure that states are implementing legally required plans to meet the standards.

The suit makes three claims.  First, that the EPA has a mandatory duty to make a determination whether 13 nonattainment areas in Alaska, Arizona, Idaho, Montana, and Nevada have attained the National Air Quality Standard for particulate matter less than 10 microns in diameter (“PM-10”).  Second, the lawsuit alleges that EPA has a mandatory duty to impose sanctions and create a Federal Implementation Plan (FIP) for PM-10 for two areas in Arizona where EPA has already made a finding of a failure to submit a sufficient State Implementation Plan.  Finally, the lawsuit claims that EPA has a mandatory duty to issue a determination that Montana has failed to submit a sufficient State Implementation Plan by the date it was required to do so.

The EPA has in the past been chided by courts for failing to live up to the deadlines in the Clean Air Act.  See, for example, Natural Resources Defense Council, Inc. v. EPA, 22 F.3d 1125 (D.C. Cir. 1994).  The problem with the Center for Biological Diversity’s suit is that, as the D.C. Circuit pointed out in the NRDC case, “[w]hile the Clean Air Act is very specific about the consequences of a state’s failure to meet the submittal deadline, the Act is silent on what should occur if the agency misses its” deadline.  22 F.3d at 1135.  In other words, there is some question as to whether the Center’s requested remedy of forcing EPA to take specific actions is legally defensible.

The EPA has, in the past, settled several other cases involving its nonperformance of mandatory duties.  For example, in Desert Rock Energy Co., LLC v. EPA, 2009 WL 3247312 (S.D. Tex. Sept. 29, 2009) the court mentions that Association of Irritated Residents v. Johnson, Civil Action No. 08-227 (N.D. Calif) “the parties sued the EPA and the EPA Administrator for failing to perform nondiscretionary duties by not acting on certain state implementation plans within the time lines set forth in section 11(k)(2) of the Act.”  Thus, this is not a new issue before the Northern District of California.

The Congress, when it wrote the Clean Air Act, did not contemplate that the EPA would be the sticking point, allowing the states to extend and ignore deadlines.  It will be interesting to see if this matter goes forward, or whether the EPA will settle this one as well.

Although the headlines would have you believe that the star of the show are the genetically-modified alfalfa seeds, the real issue that the U.S. Supreme Court will address in Monsanto Co. v. Geertson Seed Farms,  Case No. 09-475 is whether NEPA violations can cause irreparable harm. What started out in the U.S. District Court as run-of-the-mill NEPA case, has evolved into a matter that seemingly involves the hot-button topic of genetically modified crops.

Despite the hype, the justices stayed fairly close to the script at Tuesday’s oral argument, generally declining to go into the merits of genetically-modified crops, though Justice Scalia wandered off the reservation, questioning the idea that genetically modified crops could contaminate other crops, adding that “this isn’t the contamination of the New York City water supply.  This isn’t the end of the world.”

At least two of the justices seemed to wonder why the case was before the Supreme Court at all.  Barely a minute into the argument, Justice Alito demanded to know whether the case would become moot once the USDA finalizes its environmental impact statement.

If we agree with your argument that the Ninth Circuit applied the wrong preliminary injunction standard and remand for them to apply the right preliminary injunction standard, the case may be moot by the time they do that.

The USDA released a draft in December, 2009, and expects to have a final EIS in a year.  Gregory Garre, arguing for Monsanto, tried to dodge that bullet by claiming that Monsanto has, indeed, appealed the vacatur as well as the injunction and that “this case presents important legal issues concerning the entry of injunctive relief.’

Justice Ginsburg asked whether Monsanto and users of GM alfalfa seeds had grounds to challenge the injunction, regardless of whether it was justified.  The injunction, which allowed farmers to plant seeds that had already been sold, did not impose any restrictions on planting beyond the ones Garre to respond to organic farmers argument that one way or the other farmers would not have been allowed to plant the genetically modified alfalfa until the environmental review was done.

Chief Justice Roberts was blunt about what he thought the disposition of the case should be, suggesting that when the District Court Judge Charles Breyer (Justice Stephen Breyer’s brother) vacated the decision to deregulate the alfalfa seeds, he should have remanded the case to the U.S. Department of Agriculture for further review instead of issuing the injunction.

Why did it do that?  I mean, the way the APA [Administrative Procedures Act] works, this is sent back to the agency.  If the agency wants to partially deregulate, it can do it and then you can challenge it under the normal APA procedures.

In the briefs, the question of irreparable harm in NEPA was raised.  Monsanto argues that the Ninth Circuit erred in establishing a presumption of irreparable harm whenever NEPA’s procedural mandates are violated.  Despite the fact that the Ninth Circuit specifically denied it was establishing a presumption of irreparable harm, Monsanto Monsanto contended that the Ninth Circuit’s approach was effectively the same.  Geertson Farms, on the other hand, claimed that it had met the “likelihood of irreparable harm portion of the test for injunctive relief irrespective of whether there was a presumption.

Although Justice Stephen Breyer recused himself because his brother was the District Court Judge in the case, Justice Clarence Thomas, who represented Monsanto Co. as a private attorney prior to joining the  bench, refused to recuse himself.  A decision is expected some time in late June.

Posted by: Steven M. Taber | April 27, 2010

EPA Seeks Public Comment on Aircraft Lead Emissions

On April 21, 2010, the EPA announced that it would seek public comment on data available for evaluating emissions and potential exposure to lead in gas used in piston-engine aircraft.  As the EPA stated:

Emissions of lead from piston-engine aircraft using leaded avgas comprise approximately half of the national inventory of lead emitted to air.  EPA estimates that approximately 14.6 billion gallons of leaded avgas were consumed between 1970 and 2007, emitting approximately 34,000 tons of lead.

The EPA will publish an Advanced Notice of Proposed Rulemaking in the Federal Register which describes the data that are currently available and being collected that would help evaluate health impacts from piston-engine aircraft emissions.  That will start the 60-day public comment period.

The ANPR is one of the steps EPA has taken in response to a petition that Friends of the Earth filed on October 3, 2006 requesting that the Administrator find that aircraft lead emissions cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare, and that EPA regulate those emissions.  The EPA had previously issued a Notice requesting public comment on the Petition in November, 2007, ended up not taking any action.

The Aircraft Owners and Pilots Association (AOPA) has long argued that lead is a necessary component of 100 octane leaded aviation gasoline.  For example, two years ago, in response to the Friends of Earth petition, AOPA commented that:

Currently, there is no simple alternative for 100LL avgas.  Any change in the current fuel standard will have a direct impact on the safety of flight and therefore must be fully tested and FAA approved before any operational changes occur.

Thus, it is highly likely that EPA’s new push to get the lead out will be met with some resistance again from AOPA.

Posted by: Steven M. Taber | April 26, 2010

U.S. Supreme Court Refuses to Consider Michigan's Asian Carp Case

The U.S. Supreme Court issued an Order today, Monday, April 26, 2010, stating simply “The motion of Michigan to reopen and for a supplemental decree is denied. The alternative motion for leave to file a bill of complaint is denied.”  Thus, the State of Michigan’s third attempt to get the high court to have Illinois close access to the Great Lakes to protect from an infestation of Asian Carp was denied.

Michigan and several other Great Lakes states and several environmental groups all were trying to force Illinois, the Metropolitan Water Reclamation District of Greater Chicago, the barge shipping industry and the federal government close the locks on the Chicago River so that the invasive species could get into Lake Michigan.   Once in Lake Michigan, Asian Carp, Michigan argued, could devastate the commercial and recreational fishing industry.

Illinois argued that it is successfully employing electric barriers to hold back the invasion and that closing the locks would be both ineffective at stopping the carp and extremely harmful to the Chicago economy.

As is typical in this type of case, the law used did not directly concern the issue at hand.  Michigan sought for the Supreme Court to reopen a 1929 decision that limited how much water Illinois can divert from Lake Michigan, which stemmed from Chicago’s construction of the canal to reverse the flow of the Chicago River and keep pollution out of Lake Michigan.  The Supreme Court limited the amount of water Illinois could divert from the Great Lakes in a series of decrees, most recently in 1980.

The federal government opposed Michigan’s suit, saying that the drastic measure of closing the locks was premature.  Moreover, the federal government believed that Michigan and the other states should have filed a lawsuit in the U.S. District Court instead of attempting to go directly to the Supreme Court.  Michigan had been attempting to invoke the U.S. Supreme Court’s original jurisdiction for legal disputes among states.

The case pitted environmental groups, Michigan and several other Great Lakes states against Illinois, the Metropolitan Water Reclamation District of Greater Chicago, the barge shipping industry and the federal government.

Michigan argued that the threat of the invasive species getting into Lake Michigan, where it could devastate the commercial and recreational fishing industry, required the court to order the locks closed immediately.

Opponents argued that the federal government and the state of Illinois are successfully employing electric barriers to hold back the invasion and that closing the locks would be both ineffective at stopping the carp and extremely harmful to the Chicago economy.

Michigan wanted the Supreme Court to reopen a 1929 decision that limited how much water Illinois can divert from Lake Michigan, which stemmed from Chicago’s construction of the canal to reverse the flow of the Chicago River and keep pollution out of Lake Michigan.

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