Agere Systems, Inc. v. Advanced Environmental Tech. Corp

Apr 12: In the U.S. Court of Appeals, Third Circuit, Case No. 09-1814. The appeal arises from nearly three decades of involvement by U.S. EPA at the Boarhead Farms Superfund Site in Bucks County, Pennsylvania. At issue in the underlying case was the disposal of millions of gallons of toxic waste, over a six-year time period, by more than twenty parties, with millions of dollars of cleanup costs at stake. Along with the factual issues, the case implicates the "still developing distinctions" between liability under § 107(a) and § 113(f) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 and the Superfund Amendments and Reauthorization Act of 1986 (SARA),

codified together at 42 U.S.C. §§ 9601-9675 (collectively CERCLA).

 

    On June 18, 2002, five plaintiffs -- Agere Systems, Inc. (Agere), Cytec Industries, Inc. (Cytec), Ford Motor Company (Ford), SPS Technology, LLC (SPS), and TI Automotive Systems LLC (TI) (collectively plaintiffs or appellees) -- filed the present suit against twenty-three defendants for cost recovery and contribution under CERCLA and the Pennsylvania Hazardous Sites Cleanup Act (HSCA), to recover costs that the plaintiffs had paid to the EPA pursuant to certain consent decrees or that they had provided as a consequence of the cleanup of hazardous substances at the Boarhead Site. All of the defendants except one, Carpenter Technology Corporation (Carpenter), settled their liabilities with the plaintiffs or were otherwise dismissed from the suit after a bench trial.

 

    On August 22, 2008, the United States District Court for the Eastern District of Pennsylvania entered judgment against Carpenter, finding it liable for 80% of the costs paid by the plaintiffs as of December 31, 2007, plus prejudgment interest. The Court also entered a declaratory judgment that Carpenter is liable for 80% of all cleanup costs that the plaintiffs may incur after January 1, 2008. The District Court denied Carpenter's motion to alter or amend the judgment, and Carpenter filed this appeal.

 

    The Appeals Court vacated the District Court's judgment and remand for proceedings consistent with its opinion. The Appeals Court made four request of the District Court in its reconsideration: [1] ". . .we ask the District Court to make a clear and unequivocal finding, if possible, as to when the EPA completed its removal action. To the extent the District Court decides it must reopen the record in order to make that finding, it may do so. . . [2] permit TI. . . and Agere. . . to go forward with their § 107(a) cost recovery claims to recoup costs paid as part of the shared expense of cleaning up the Boarhead Site. . . [3] . . .because we hold that Cytec, Ford, and SPS, as well as TI (with regard to OU-2), are shielded from contribution counterclaims under § 113(f)(2) and therefore do not have § 107(a) claims for costs incurred pursuant to the consent decrees, the District Court should again proceed solely under § 113(f) as to those claims. . . [4] while proceeding under § 113(f) to allocate liability among the parties, the District Court may not consider the June 23rd stipulation as evidence against Carpenter, at least not without addressing the evidentiary problems noted herein. . ."

 

    With regard to item #1 above, the Appeals Court said, ". . .whether there is a time-bar to plaintiffs' recovering the approximately $7 million they paid to reimburse the EPA for past costs. Further, if the District Court finds that the EPA initiated 'on-site physical construction' of the remedial action within three years of the completion of its removal action, it may apply the six-year statute of limitations exception contained in § 113(g)(2)(B). If the District Court finds that the EPA's December 6, 2001 suit was not time-barred, and that the plaintiffs are able to recover for past costs, the Court should make a more exact finding as the amount that the plaintiffs paid to reimburse the EPA for past costs."

 

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U.S. v. Starnes

Sep 24: In the U.S. Court of Appeals, Third Circuit, Case Nos. 07-3341 & 08-1691. Cleve-Allan George and Dylan C. Starnes appeal from judgments of conviction and sentence entered against them following a jury trial in the United States District Court for the District of the Virgin Islands. Although these appeals have not been formally consolidated, the Appeals Court resolved them together because they arise from a common set of facts. The Appeals Court affirmed the judgments.

Virgin Islands Housing Authority (VIHA) received a Federal grant for asbestos cleanup to be “performed in strict accordance with all federal, state and local regulations and ordinances” and eventually awarded a demolition contract to Alvin Williams Trucking & Equipment Rental, Inc. That company, with the consent of VIHA, subcontracted the asbestos abatement portion of the project to the Virgin Islands Asbestos Removal Company (VIARCO), a company owned by George. VIARCO had “joined forces” with Environmental Contracting Company (ECC), a company run by Starnes.

Among other violations, a “pressure washer” was used to dislodge asbestos-containing materials from the site’s structures. The Appeals Court said, this removal method, although time-efficient, generated a substantial amount of debris-filled wastewater, which the crew pumped into toilets and bathtubs. But those fixtures rapidly clogged, causing wastewater to pour out and accumulate on the buildings’ balconies. In response, George constructed a drainage system out of PVC pipes, which permitted the wastewater to flow off the balconies and down to the ground. When the wastewater evaporated, it left a dusty white residue clinging to the facades of the buildings and the surrounding sidewalks and grass.

The District Court sentenced Starnes to thirty-three months of imprisonment, three years of supervised release, and a special assessment of $1,600. While noting the government’s position that George’s acts were more egregious than those of Starnes, the District Court nonetheless imposed on George the same sentence that it had imposed on Starnes.

The Appeals Court said, "Both defendants also argue, albeit somewhat perfunctorily, that the District Court committed significant procedural error by failing to give meaningful consideration to the sentencing factors set forth in 18 U.S.C. § 3553(a). We disagree. While a sentencing court must consider all of the § 3553(a) factors, it does not have to discuss and make findings as to each factor so long as the record otherwise makes clear that it took the factors into account."

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Hempstead County Hunting Club v. Southwestern Electric Power

Mar 12: In the U.S. Court of Appeals, Third Circuit, Case No. 08-2613. Hempstead County Hunting Club (HCHC) filed a citizen's suit against Southwestern Electric Power Company (SWEPCO) pursuant to the Clean Air Act (CAA), seeking a preliminary and permanent injunction to prevent SWEPCO from commencing construction, constructing, or continuing construction of its 600-megawatt pulverized coal-fired power plant in Hempstead County, Arkansas, without first obtaining a Prevention of Significant Deterioration (PSD) permit as required by the CAA.

On the same day that it filed its complaint, HCHC filed a motion for temporary restraining order and preliminary injunction. The
district court denied the motion, and HCHC filed an interlocutory appeal, arguing that the district court abused its discretion in
denying the preliminary injunction because "SWEPCO has proposed to construct and is constructing its Hempstead Plant, although it does not have a CAA permit."

SWEPCO filed a motion to dismiss the appeal, arguing that the appeal is moot because it has now received the CAA permit and has lawfully begun construction at the site, rendering HCHC's appeal of the denial of its motion for a preliminary injunction to halt preconstruction activities moot. The Appeals Court agreed and dismissed the appeal as moot.

The Appeals Court said, "HCHC's allegation that SWEPCO is acting illegally rests on its argument that SWEPCO is engaging in construction activities without a permit. Therefore, the present case is comparable to Mississippi River Revival in which, after the MPCA issued storm permits, the district court dismissed the environmental organizations' complaints as moot, as the complaints were based on the allegation that the Cities were discharging storm waters without required permits."

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American Bird Conservancy v. Kempthorne

Mar 11: In the U.S. Court of Appeals, Third Circuit, Case No. 07-4609. In July and August 2005, appellants, a number of conservation groups, petitioned the U.S. Fish and Wildlife Service (FWS) to list as endangered on an emergency basis the red knot, a species of migratory shorebird. The FWS declined to undertake emergency rulemaking by letter of December 22, 2005, but continued to review the petition in the context of a non-emergency.

On June 13, 2006, before the FWS made a final determination, appellants filed a complaint in the U.S. District Court for the District of New Jersey claiming (1) that the denial of emergency rulemaking was arbitrary and capricious, in violation of the Endangered Species Act (ESA), and (2) that the FWS violated the ESA by failing to issue timely findings on the petition.

The FWS issued its final determination -- that the listing of the red knot was warranted but precluded by higher-priority listing activity -- in its periodic Candidate Notice of Review (CNOR) published on September 12, 2006. In response, appellants dismissed their timeliness claim, but persisted with their challenge to the denial of emergency rulemaking. In an opinion and order dated October 11, 2007, the District Court dismissed the complaint for lack of subject matter jurisdiction, finding that the FWS’s denial of the emergency listing request was not reviewable under either the ESA or the Administrative Procedure Act (APA). Given this finding, the District Court did not find it necessary to reach the FWS’s claim that the publication of the warranted but precluded listing determination in the CNOR rendered moot appellants’ challenge to the denial of emergency rulemaking. The appeal followed.

The Appeals Court dismissed the appeal as moot; however, it said, "We note, as we conclude, that appellants have received quite substantial relief. Now that the CNOR has issued, the red knot is on the agency’s watchlist. This means that the emergency monitoring system set forth at 16 U.S.C. § 1533(b)(3)(C)(iii) has become available in the event of exigent circumstances that warrant immediate protection of the red knot."

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TSG Inc. v. U.S. EPA

Aug 8: In the U.S. Court of Appeals, Third Circuit, Case No. 07-1116 . TSG, Inc. (TSG) filed a petition to challenge the validity of U.S. EPA's Applicability Determination, which found that TSG was a fabric “finishing operation” under Subpart OOOO of the National Emission Standards for Hazardous Air Pollutants (NESHAP). TSG argues that its fabric treating process should not be required to abide by the finishing operation standards and should instead qualify as a coating operation under the regulations. The Appeals Court concluded that the EPA did not "clearly err" in its determination that TSG was a finishing operation and denied the petition.

In TSG’s process, stain-repellant chemicals are diluted in a solvent, trichloroethene (TCE), which is then sprayed onto the fabric as it passes through the spraying machinery. This method allows TSG to process many different fabric weights, widths, colors, and constructions, as the solvent is generally gentler on a wider variety of fabrics than is a water-based system. As TSG characterizes it, the solvent acts as a “carrier” for the stain-repellant chemicals as they are sprayed onto the fabric and then evaporates when the fabric passes through the heating and drying machinery. A solvent recovery system then captures the evaporated solvent for reuse.

As a key part of its ruling, the Third Circuit said, "We agree with the EPA’s determination that '[t]he solvent that TSG uses to dilute stain repellent finishes is a transfer agent that is added to the finish as an auxiliary to improve the finishing process, and therefore, is a finishing material.' As the regulation states, the definition of finishing materials 'includ[es] auxiliaries,' so long as they are 'added to the finish to improve the finishing process.' 40 C.F.R. § 63.4371."

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Beazer East, Inc. v. Mead Corporation

May 13: In the U.S. Court of Appeals, Third Circuit, Case No. 06-4993. The Appeals Court explains that this is the third appeal in this long-running contribution claim under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA). After the second appeal was decided, defendant Mead moved for judgment for failure to state a claim or for lack of subject-matter jurisdiction. The District Court denied the motions, but certified a controlling question of law under 28 U.S.C. § 1292(b) raising the issue of whether the effect of Cooper Indus. v. Aviall Servs., Inc., 543 U.S. 157 (2004), is to deny subject-matter jurisdiction over plaintiff Beazer’s contribution claims under § 113(f)(1) of CERCLA, 42 U.S.C. § 9613(f)(1). Also implicated is the denial of Mead’s motion to dismiss for failure to state a claim under § 113(f)(1).

The Appeals Court ruled, "We conclude that the District Court has subject-matter jurisdiction. We will also affirm the denial of the motion for judgment on the pleadings and will remand for further proceedings."

In this on-going case, Mead filed this interlocutory appeal. After it was docketed and the briefs were filed, but before oral argument, the Supreme Court decided United States v. Atlantic Research Corp., 127 S. Ct. 2331 (June 11, 2007), holding that a “potentially responsible party” (PRP) may recover against another PRP for cleanup costs under § 107(a) [See WIMS 6/12/07]. Mead contends that because the § 107 claim was dismissed in 1996 by the District Court, Beazer’s only remaining means of recovery is under § 113(f)(1), a claim that is fatally flawed in light of Cooper. Mead argues that because Beazer has not “been sued under § 106 or § 107(a) . . . [it may not] obtain contribution under § 113(f)(1) from other liable parties.”

In its conclusion, the Appeals Court said, "We do not lightly invoke waiver, but as the Supreme Court has cautioned, '[t]here must be an end to litigation someday, and free, calculated, deliberate choices are not to be relieved from.' Ackermann v. United States, 340 U.S. 193, 198 (1950). This case has been ongoing since 1991. Mead’s liability under § 113(f)(1) was established by the time of the District Court’s orders in 2002 – well before this Court’s June 23, 2005, opinion in Beazer II. Allowing Mead to renew its argument at this late point in the litigation would seriously impair the finality of the rulings of this Court and the District Court. Mead must live by its long-standing and considered decision not to pursue its § 113(f) objection.

"We agree with the District Court that Mead waived its challenge to the applicability of § 113(f)(1) and the Court has subject-matter jurisdiction. Accordingly, we again remand this case to the District Court to hold an equitable allocation proceeding in accordance with Beazer II."

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