Tuesday, September 23, 2008

Northwest Coalition for Alternatives to Pesticides v. U.S. EPA

Sep 19: In the U.S. Court of Appeals, Ninth Circuit, Case Nos. 05-75255, 05-76807. The petitioners are two environmental groups challenging the U.S. EPA's establishment of tolerances for seven pesticides used mostly on fruit and vegetable crops. The Appeals Court in a split (2-1) decision granted the petition in part, denied it in part, and remanded the case to the EPA.

The case involves the regulation of pesticides under two statutes: the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), and the Federal Food, Drug, and Cosmetic Act (FDCA). The Appeals Court notes that in 1996, Congress amended the FDCA by enacting the Food Quality Protection Act (FQPA), Pub. L. No. 104-170, 110 Stat. 1489. One of the key provisions of the FQPA requires the EPA to give special consideration to risks posed to infants and children when establishing pesticide tolerances.

The FQPA directs the EPA to use an additional tenfold margin of safety . . . to take into account potential pre- and post-natal toxicity and completeness of the data with respect to exposure and toxicity to infants and children. EPA may “use a different margin of safety for the pesticide chemical residue only if, on the basis of reliable data, such margin will be safe for infants and children." "Unfortunately," as the Appeals Court points out, the FQPA does not define “reliable data,” and says, "The dispute before us turns on the definition of this term."

Between December 2001 and April 2002, EPA published seven regulations establishing tolerances for the pesticides acetamiprid, fenhexamid, halosulfuron-methyl, isoxadifen-ethyl, mepiquat, pymetrozine, and zetacypermethrin and did not apply the presumptive 10x child safety factor to any of these seven pesticides. EPA reduced the 10x child safety factor to 3x for four of the pesticides (acetamiprid, fenhexamid, isoxadifen-ethyl, and pymetrozine), and did not apply a child safety factor at all for the others.

The majority concluded, "Because the EPA failed to adequately explain the basis for its deviations from the 10x child safety factor for acetamiprid, mepiquat, and pymetrozine, we grant the petitions for review in part and remand to the EPA for further proceedings consistent with this opinion. On all other issues, we deny the petitions for review." The dissenting Justice indicated in part concurring and in part and dissenting, "I agree with the majority’s conclusion that 'the computer modeling used by the EPA to calculate the safety of drinking water was neither contrary to law nor arbitrary and capricious.'" and did not act arbitrarily and capriciously by establishing the pesticide tolerances for acetamiprid, mepiquat, and pymetrozine; but disagreed with the majority’s conclusion that the tolerance regulations for acetamiprid, mepiquat, and pymetrozine must be remanded.

Access the complete opinion (
click here).

USA v. Capital Tax Corp

Sep 19: In the U.S. Court of Appeals, Seventh Circuit, Case No. 07-3744. Capital Tax Corporation (Capital Tax) is an Illinois company that purchases distressed real estate properties and resells them for profit. At a Cook County scavenger sale in October 2001, Capital Tax successfully bid on tax certificates to a derelict paint factory on the south side of Chicago. Capital Tax claims that it then entered into an agreement to sell the property to a man named Mervyn Dukatt. Pursuant to this alleged contract, Capital Tax exercised its option on the tax deed and delivered possession of the property to Dukatt. Capital Tax retained legal title to the property, however, as security for the remainder of the purchase price. Dukatt never made another payment, leaving Capital Tax with title to an unwanted property.

Both the Chicago Department of the Environment (CDOE) and U.S. EPA were called to the old paint factory after receiving complaints that toxic paint products were leaking out of the factory into nearby streets and sewers. The inspections revealed thousands of rusty and leaking barrels containing hazardous waste. The EPA ordered Capital Tax to dispose of the waste but Capital Tax refused; the EPA cleaned up the site itself.

The Government then initiated the legal action under Section 107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) for the response costs it incurred. The district court granted summary judgment in favor of the Government on both liability and damages. Capital Tax appealed the decision, raising two basic arguments. (1) it claims that it is not liable under CERCLA because it is not the “owner” of the facility; and (2) even if it is liable, Capital Tax claims that it is only responsible for the cleanup of the parcels it owned.

On the ownership and liability issue the Appeals Court said, "From this record, it is difficult for us to determine whether Capital Tax had a valid and enforceable contract for the sale of land under Illinois law. If there is no valid contract, then Capital Tax is the 'owner' under § 107(a)(1) and is liable under CERCLA. If there is a valid contract and if equitable conversion applies, Capital Tax is not the 'owner' under § 107(a)(1) and is not liable under CERCLA. The case will likely turn on whether the facts show that Dukatt was, in fact, a bona fide buyer."

On the apportionment issue, the appeals Court indicates that, "As the district court noted, Capital Tax’s mistake is in attempting to apportion liability based on where the hazardous materials were located on the day they were removed. Those hazardous materials could easily have originated in another part of the plant. As in the game of 'musical chairs,' the fact that the chemicals came to rest in any particular place when production ended was largely happenstance. . . Because we have commingling, cross-contamination and migration occurring on a site that formerly operated as a single, unitary operation, there is no basis for apportionment. [citing: See Burlington Northern, 520 F.3d at 956-58].

The Appeals Court also ruled, "A 'sufficient cause' for failing to comply is a reasonable belief that one is not liable under CERCLA. See United States v. Barkman . . .Because we are remanding this case to district court on the issue of liability, we find it appropriate to vacate the award of damages. The district court may reassess the issue of penalties, if it deems that action necessary, after resolving the liability issue."

Access the complete opinion (click here).