In describing the background to the case, the Appeals Court indicates that in 1979, Bergmann bought land in Detroit from the Michigan State Transportation Commission. A decade later, he sued the Commission and the Michigan Department of Transportation under the Federal Comprehensive Environmental Response, Compensation, and Liability Act. He alleged that there was contamination on the site and sought the "costs of exploratory work and of remediating" the land. In its initial pleadings, the Department asserted sovereign immunity from suit. At that time, however, the Supreme Court had interpreted the Eleventh Amendment to allow states to be sued under CERCLA. See Pennsylvania v. Union Gas Co., 491 U.S. 1 (1989). The Department later dropped the sovereign-immunity defense in its answer to Bergmann's first amended complaint.
The parties settled. The district court entered a consent decree on June 21, 1991. The decree required the Department to remediate Bergmann's property by March 31, 1995. If by then the Department failed to make a good-faith effort to remediate, the decree required the Department to pay Bergmann $2,000 per month in liquidated damages on the first day of every month until the remediation was complete.
The Department failed to remediate the property or to pay the liquidated damages. On July 31, 2009 -- more than 14 years after those obligations came due -- Bergmann filed a motion with the same district court to enforce the decree. In response, the Department asserted sovereign immunity, citing a change in Supreme Court precedent. The district court eventually held that the Department had waived its sovereign immunity decades earlier by abandoning its argument that immunity barred the suit. The court then granted Bergmann's motion in part: It held that Michigan's 10-year statute of limitations barred enforcement of the Department's remediation obligation, but that each of the missed $2,000 payments triggered its own 10-year limitations period. Thus, the court awarded Bergmann damages for the period between August 1999 and March 26, 2010 (the date of its order).
The Appeals Court explains its decision and cites the following cases in saying, "Both parties argue that the district court misapplied Michigan's statute of limitations. But we think the court should not have applied the statute at all. As Judge Posner has explained: 'From the standpoint of interpretation a consent decree is a contract, but from the standpoint of remedy it is an equitable decree.' Cooke v. City of Chicago, 192 F.3d 693, 695 (7th Cir. 1999) (collecting cases). Thus, if a party violates a consent decree, his opponent 'must ask the court for an equitable remedy[,]' which is then 'subject to the usual equitable defenses.' Id. For this reason, the Second Circuit holds that the equitable doctrine of laches -- and not the state statute of limitations -- governs the timeliness of motions to enforce consent decrees in nondiversity cases. See Brennan v. Nassau County, 352 F.3d 60, 6364 (2d Cir. 2003) (per curiam). We agree with the Second Circuit. . ." [Note: the doctrine of laches indicates that failure to assert one's rights in a timely manner can result in a claim's being barred by laches].
The Appeals Court ruled, "On remand, therefore, the district court should apply the doctrine of laches in deciding Bergmann's motion to enforce the decree. The district court's order partially enforcing the decree is vacated, and the case remanded for proceedings consistent with this opinion."
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