Native Village Of Kivalina IRA Council v. U.S. EPA

Aug 9: In the U.S. Court of Appeals, Ninth Circuit, Case No. 11-70776. On Petition for Review of an Order of the U.S. EPA Environmental Appeals Board. Petitioners Native Village of Kivalina IRA Council, Native Village of Point Hope IRA Council, Alaska Community Action on Toxics, and Northern Alaska Environmental Center (collectively, Kivalina) appeal the EPA Environmental Appeals Board's (the EAB) order denying review of their challenges to a permit authorizing Intervenor Teck Alaska, Inc. (Teck) to discharge wastewater caused by the operation of the Red Dog Mine.

 

    The EAB concluded that Kivalina had not satisfied the procedural requirements to obtain review under 40 C.F.R. § 124.19(a) because it did not demonstrate why the EPA responses to comments were clearly erroneous or otherwise warranted review. The Appeals court ruled, "We agree that Kivalina did not meet the requirements of § 124.19, and we deny Kivalina's petition for review."

   

    The Red Dog Mine is an open pit zinc and lead mine in northwestern Alaska, operated by Teck in partnership with Intervenor NANA Regional Corporation. The mine's operations produce wastewater contaminated with metals through contact with mined materials and surfaces. After being treated, the wastewater eventually enters the Wulik River, which flows into the Chukchi Sea near the Native Village of Kivalina. On November 18, 2010, after some of Kivalina's challenges were rendered moot, EAB handed down an order denying review of the remaining portion of Kivalina's petition.

 

    In its order, the EAB observed that section II.C.3 of Kivalina's petition consisted of only slightly more than two pages, and that Kivalina had not set forth sufficient detail about why the EPA's responses to public comments were "irrelevant, erroneous, insufficient, or an abuse of discretion," as required by § 124.19(a). On December 8, 2010, the EPA issued a final permit decision. Kivalina filed a timely petition for review on March 18, 2011.

 

    Specifically, Kivalina claims its petition sufficiently challenged three monitoring conditions in the 2010 Permit: (1) the reduction in monitoring requirements, (2) the removal of biomonitoring provisions, and (3) the EPA's failure to require third-party monitoring. The Appeals Court addresses each challenge under the requirements of § 124.19(a) and determines each to be insufficient and

rules that EAB did not err in denying their review.

 

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U.S. Magnesium LLC v. U.S. EPA

Aug 6: In the U.S. Court of Appeals, Tenth Circuit, Case No. 11-9533. On petition for review of a final action by U.S. EPA. The Appeals Court explains that US Magnesium seeks review of a recent final rule from the U.S. EPA. In its rule, the EPA has called for Utah to revise its State Implementation Plan (SIP) for the federal Clean Air Act (CAA). Under the CAA, the EPA may call for a state to revise its SIP (a SIP Call) if the EPA finds the state's current SIP substantially inadequate. Here, the EPA determined that Utah's SIP was substantially inadequate because it contains an Unavoidable Breakdown Rule (UBR), which permits operators of CAA-regulated facilities to avoid enforcement actions when they suffer an unexpected and unavoidable equipment malfunction. In this SIP Call, published as a final rule in April 2011, EPA requested that Utah promulgate a new UBR -- one that conforms with the EPA's interpretation of the CAA. US Magnesium maintains that the SIP Call is arbitrary and capricious and asks the court to vacate it. However, the Appeals Court denied the petition for review.

 

    After several years of negotiations between EPA and Utah's Division of Air Quality (UDAQ) failed to produce an acceptable UBR, in 2010, EPA published a notice of proposed rulemaking proposing to find the Utah SIP substantially inadequate due to its continued inclusion of the UBR. Although UDAQ opposed the proposed rule, EPA nevertheless published the SIP Call as a final rule in April 2011, and Utah has since agreed to revise the UBR.

 

    When it promulgated the final rule, the EPA provided three primary justifications for its finding that the Utah SIP was substantially inadequate. First, the EPA found that the UBR "[d]oes not treat all exceedances of SIP and permit limits as violations," which could preclude injunctive relief; Second, the EPA determined that the UBR "could be interpreted to grant the Utah executive secretary exclusive authority to decide whether excess emissions constitute a violation"; and Third, the EPA found that the UBR "improperly applies to Federal technology-based standards such as [NSPS and NESHAPS]."

 

    On of the primary concerns was, "EPA lacks the regulatory authority to make a SIP Call based on policy or guidance that has not become applicable law. The [Herman Memorandum] EPA cites as justification for the SIP Call has never been subjected to the legal requirements of notice and public rulemaking under the Administrative Procedures Act. . ."

 

        EPA argued that US Magnesium did not have standing to bring the action, however, after a lengthy analysis the Appeals Court ruled, "Because the SIP Call significantly affects Utah's decisionmaking process, and because we find that a decision overturning the SIP Call would significantly increase the chances of action by Utah that is favorable to US Magnesium, we hold that US Magnesium has standing in this case." One Justice issued a separate concurring opinion state agreement that "US Magnesium must be denied relief, but my reasons differ from those of the majority. In my view, US Magnesium lacks standing because it has failed to make the necessary showing that its alleged injury would be redressed by a favorable decision."

 

    However, contrary to US Magnesium claims, the Appeals Court determined that the Administrative Record adequately supports the EPA's conclusion that the UBR rendered the Utah SIP substantially inadequate; and EPA's SIP Call was not inconsistent with its own policy statements and regulations.

 

    On the subject of the Herman Memo not being a rule, EPA responded that it agree that the Memo "was a nonbinding policy statement, not a legislative rule," and said that it treated the memorandum as a "policy statement and did not rely on it in the

rulemaking other than as a statement of the EPA's interpretation of the CAA." The Appeals court said, ". . .the EPA referenced the policy statements to explain its interpretation of the CAA, but did not attempt to rely on the statements as a rule of law in their own right." The Appeals Court said, "This is in keeping with our precedent. AMREP Corp. v. FTC, 768 F.2d 1171, 1179 (10th Cir. 1985). . ."

 

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Summit Petroleum Corporation v. U.S. EPA

Aug 7: In the U.S. Court of Appeals, Sixth Circuit, Case Nos. 09-4348 & 10-4572. On Petition for Review of Final Action of the U.S. EPA. The Appeals Court explains that the case arises from a final action of EPA determining that a natural gas sweetening plant and various sour gas production wells, commonly owned by Petitioner Summit Petroleum Corporation (Summit) and separately located within an area of approximately forty-three square miles, constitute a single stationary source under the EPA's Clean Air Act Title V permitting program.

 

    Specifically at issue is the EPA's conclusion that Summit's facilities satisfy the regulatory requirement of being "located on . . . adjacent properties" because, although physically independent, they are "truly interrelated." Summit, together with Amici American Petroleum Institute and American Exploration and Production Counsel, argues that the EPA's determination that the physical requirement of adjacency can be established through mere functional relatedness is unreasonable and contrary to the plain meaning of the term "adjacent."

 

    The majority Appeals Court agreed and ruled, ". . .we vacate the EPA's final determination and remand this case to the EPA to determine whether Summit's sweetening plant and sour gas wells are sufficiently physically proximate to be considered 'adjacent' within the ordinary, i.e., physical and geographical, meaning of that requirement."

 

    The case involves Summit, a producer of natural gas that owns and operates a natural gas sweetening plant in Rosebush, Michigan. Summit's plant "sweetens" the "sour" gas from approximately one hundred sour gas production wells by removing hydrogen sulfide so that the gas can be used. Summit owns all of the production wells and the subsurface pipelines that connect each of the wells to the sweetening plant. The wells themselves are located over an area of approximately forty-three square miles at varying distances from the plant -- from five hundred feet to eight miles away -- and Summit does not own the property between the individual well sites or the property between the wells and the plant. None of the well sites share a common boundary with each other, nor do any of the well sites share a common boundary with Summit's production plant. Flares work as part of the plant operations by burning off natural gas waste to relieve pressure on the gas collection equipment. The closest flare is located approximately one half-mile from the plant, while the remaining flares are each over one mile away.

 

    The Appeals Court said, "Together with the ordinary and dictionary definitions of the term 'adjacent,' the Rapanos decision, and similar case law, points clearly toward the conclusion that the regulatory requirement that aggregated activities be 'located on contiguous or adjacent properties' is unambiguous in the context in which it is here considered. . ."

 

    EPA claims that because it has an established a history of supplementing the traditional definition of adjacency with the concept of "activities' functional relatedness, we must review its interpretation with heightened deference." The Appeals Court disagrees and saying, "Though the EPA has previously considered the functional relationship between activities in assessing whether they lie on 'contiguous or adjacent properties,' its request of increased deference to this interpretation rests on the premise that some measure of deference is in fact owed to the EPA's interpretation in the first instance -- a premise we reject in light of the unambiguousness of the regulation at issue."

 

    In a dissenting opinion, one Justice indicates, "Congress passed the Clean Air Act (CAA) 'to protect and enhance the quality of the Nation's air resources so as to promote the public health and welfare and the productive capacity of its population.' 42 U.S.C. § 7401(b)(1). Because the majority hamstrings the Environmental Protection Agency's (EPA) ability to pursue this mission by refusing to defer to the agency's reasonable interpretation of its own regulation, I respectfully dissent."

 

    The dissenting Justice said, "The majority's adoption of Summit's position raises its own policy concerns. Primarily, today's ruling frees the oil and gas industry to gerrymander its way out of Title V regulation. So long as sufficient distance exists between each well (so that they are not 'adjacent' as the majority defines that term), or someone other than the drilling company owns parcels of land in between each well (so that they are not 'contiguous'), the drilling operation cannot be classified as a major source through aggregation. Unlike the CAA provisions governing hazardous air pollutant emissions, see 42 U.S.C. § 7412(n)(4), Title V does not grant the oil and gas industry immunity from aggregation; this court should not effectively create such a provision when Congress has not done so."

 

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Upper Blackstone Water Pollution Abatement Dist. v. U.S. EPA

Aug 3: In the U.S. Court of Appeals, First Circuit, Case No. 11-1474 and 11-1610. Petitions for review of a final permit decision by U.S. EPA. The petitions seek review of certain effluent limitations imposed by EPA in a National Pollutant Discharge Elimination System (NPDES) permit on the discharges of Upper Blackstone Water Pollution Abatement District, a sewage treatment plant located in central Massachusetts. The District's discharges are into the headwaters of a polluted river which, in due course, flows into other rivers, and ultimately empties into Narragansett Bay.

 

    The Appeals Court indicates that the states of Massachusetts and Rhode Island each have strong interests in the health of these waters and generally have supported the EPA's decisions during the permitting process. The District, supported by its member towns, has an interest in avoiding compliance costs associated with the permit and has challenged the effluent limitations as premature and unsupported by the scientific record.

 

    The Appeals Court rules, "We have stayed enforcement of the permit during this appeal and while the parties were engaged in settlement negotiations in a court-sponsored settlement program. We now lift the stay, deny the petitions, and find no error in the EPA's final permit decision.

 

    The District first attacks a scientific model the EPA incorporated into its analysis of the nitrogen-fueled cultural eutrophication in Narragansett Bay. The District argues that this model, which was created by the University of Rhode Island's Marine Ecosystems Research Laboratory (MERL) in the 1980s to simulate water quality conditions in the Bay, is so unreliable and unrepresentative of actual Bay conditions as to entirely undermine the EPA's nitrogen analysis. The MERL model was peer-reviewed and published in a scientific journal.

 

    In response, the Appeals Court said, "Where the agency follows the proper procedures and acts with a reasonable basis, both its choice of scientific data and interpretation and application of that data to real world conditions are entitled to deference. . . Where the EPA did rely on the MERL model, the record reflects that it fully accounted for the model's shortcomings. . . The District's argument that the MERL model should have been excluded from consideration entirely is without merit. . . The EPA also followed the proper procedures for ensuring that the model received scrutiny not only from the permittee, but from the scientific community and the public. . . The EPA's determination, based on its analysis of the evidence before it as a whole, that a nitrogen limit of 5.0 mg/L was necessary to achieve Rhode Island's water quality standards was not a 'hunch[] or wild guess[]' but a rational exercise of judgment."

 

    The District also challenged whether the nitrogen limit was "necessary" or "sufficient." The Appeals Court said, "We reject the first claim, since the EPA expressly found that the 5.0 mg/L limit was necessary to meet state standards, and that a higher limit would not achieve those standards." On the sufficient argument, the Appeals Court said, ". . .where a complex administrative statute, like those the EPA is charged with administering, requires an agency to set a numerical standard, courts will not overturn the agency's choice of a precise figure where it falls within a 'zone of reasonableness' . . . The nitrogen limit the EPA chose here is justified by the record and within the zone of reasonableness. The District's challenges to the limit fail." Other challenges are also dismissed.

 

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USA v. NCR Corporation

Aug 3: In the U.S. Court of Appeals, Seventh Circuit, Case No.12-2069. Appeal from the United States District Court for the Eastern District of Wisconsin. As explained by the Appeals Court, The case involves just one

chapter in a long-running set of efforts to clean up the Fox River in Wisconsin, after years during which various companies dumped PCBs (more formally, polychlorinated biphenyls) into its waters. Since at least the late 1990s, U.S. EPA and the Wisconsin Department of Natural Resources (WDNR) have been working to devise and implement an effective remedial plan for the River.

 

    One of companies that was designated as a "potentially responsible party (PRP)," and thus responsible for undertaking remedial work, was NCR Corporation. Acting pursuant to administrative orders, NCR has performed a significant amount of cleanup. It decided, however, in 2011 that it had done enough and announced that it was no longer going to comply with the relevant order. That is what prompted the present action by the United States and Wisconsin seeking a preliminary injunction

compelling NCR to complete the remediation work scheduled for this year. The governing statute is the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). NCR opposed the injunction, arguing that the cleanup costs were capable of apportionment, and that when so apportioned, it was clear that NCR had already performed more than its share of the work.

 

    The district court evaluated the facts otherwise and issued the preliminary injunction. NCR is presently complying with the injunction. We expedited this appeal, however, understanding that NCR is seeking to challenge its interim obligations, which have been imposed without a full trial on the merits. The Appeals Court rules, ". . .we agree with the district court that NCR has not met its burden of showing that the harm caused by pollution in the Lower Fox River is capable of apportionment. We further find no abuse of discretion in the court's decision to issue the preliminary injunction, and so we affirm its order."

 

    Citing some uncertainties from the Supreme Court and conflicting Appeals Court circuit opinions regarding liabilities and cost recovery, the Appeals Court said, "All of this is too uncertain to drive the result in the present case. If and when the time comes, NCR will be free to explore whatever possibilities may still be available to it for either contribution or cost recovery. What is available will of course depend in part on any appeal that it might take from the district court's order on this subject -- a topic that is not before us at this time. For now, we conclude that it is an open question whether, and if at all to what extent, NCR might

be able in future legal proceedings to recoup any costs it should not have paid. Thus, the district court's weighing of the equities did not amount to an abuse of discretion. Its preliminary injunction requiring NCR to complete the specified 2012 remediation work is therefore affirmed."

 

    Access the complete opinion (click here). [#Remed, #CA7]

DVL, Inc. v. Niagara Mohawk Power, Et Al

Aug 2: In the U.S. Court of Appeals, Second Circuit, Summary Order number 11-26-cv. Appealed from the judgment of the United States District Court for the Northern District of New York. Plaintiff-appellant DVL, Inc. (DVL) is a commercial real estate owner that acquired a piece of property in Fort Edward, New York (the DVL Site) in

2002. At the time of acquisition, DVL was unaware that soil at the Site contained quantities of polychlorinated biphenyls (PCBs). In 2003, DVL learned that the New York State Department of Environmental Conservation (DEC) was concerned about PCB contamination at the DVL Site. A preliminary site assessment conducted by an engineering firm retained by DEC from 2003 to 2004 revealed the presence of several types of PCBs in soil at the Site. DVL subsequently hired an environmental consulting

firm to investigate and remediate the contamination at the Site, thereby incurring substantial expenses.

 

    On October 11, 2007, DVL initiated this action against defendants-appellees Niagara Mohawk Power Corporation, National Grid USA, National Grid, and National Grid USA Service Company, Inc. (collectively, Niagara), and General Electric Company (GE), alleging that they had disposed of PCBs at the DVL Site and were therefore liable for DVL's clean-up costs and damages. DVL's complaint asserts claims under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the New York State common law of indemnification, trespass, and nuisance.

 

    On December 6, 2010, the district court denied DVL's motion for partial summary judgment as to liability, granted Niagara's and GE's motions for summary judgment, and granted GE's cross-motion to strike certain undisclosed expert testimony. The Appeals Court ruled, "We affirm for substantially the reasons set forth in the district court's thorough and well-reasoned opinion."

 

    On the CERCLA issues, the Appeals Court indicates, "The district court held that DVL failed to adduce sufficient evidence that the defendants disposed or arranged for the disposal of PCBs at the DVL Site, and accordingly denied DVL's motion for partial summary judgment as to liability and granted the defendants' motions for summary judgment. We agree with the district court's analysis, and therefore affirm. With respect to GE, DVL argues on appeal that it presented various pieces of circumstantial evidence which, taken together, establish that GE arranged for the disposal of PCBs at the DVL Site. However, much of this evidence concerns activities with no connection to the DVL Site." Finally, the Appeals Court rules, "We have considered all of the plaintiff's arguments in light of all of the evidence in the record and find them to be without merit. Accordingly, we affirm the judgment of the district court."

 

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Luminant Generation Company, et al v. U.S. EPA

Jul 30: In the U.S. Court of Appeals, Fifth Circuit, Case No. 10-60934. Petitions for Review of Orders of the Environmental Protection Agency. The Appeals Court explains that two sets of petitioners, hereinafter referred to as "Industry Petitioners" and "Environmental Petitioners," seek review of the United States Environmental Protection Agency's (EPA) final rule partially approving and partially disapproving the most recent revision to Texas's State Implementation Plan (SIP) submitted by the Texas Commission on Environmental Quality (TCEQ) pursuant to the Clean Air Act (CAA). The Industry Petitioners include Luminant Generation Co. LLC, Oak Grove Management Co. LLC, Big Brown Power Co. LLC, and Sandow Power Co. LLC. The Environmental Petitioners include Environmental Integrity Project, Sierra Club, Environment Texas Citizen Lobby, Inc., Citizens for Environmental Justice, Texas Environmental Justice Advocacy Services, Air Alliance Houston, and Community In-Power and Development Association.

 

    In summary, the Appeals Court concludes, "Because we find that the EPA did not act arbitrarily or capriciously, or contrary to law, or in excess of its statutory authority, in its partial approval and partial disapproval of Texas's SIP revision, we deny both petitions for review."

 

    In its final rule which became effective on January 10, 2011, the EPA partially approved and partially disapproved the most recent revision to Texas's SIP which was submitted by the TCEQ in 2006. The portion of the SIP at issue creates an affirmative defense against civil penalties for excess emissions during both planned and unplanned startup, shutdown, and maintenance/malfunction (SSM) events. The EPA approved the portion of the SIP revision providing an affirmative defense against civil penalties for unplanned SSM events and disapproved the portion of the SIP revision providing an affirmative defense against civil penalties for planned SSM events.

 

    Environmental Petitioners argue that the EPA's approval of the affirmative defense for unplanned SSM events is in excess of the agency's statutory authority and is not in accordance with the Act. Specifically, petitioners argue that the final rule conflicts with the plain language of the Act authorizing civil penalties in EPA and citizen suit enforcement actions, as well as the Act's requirement that the state permitting authority be able to assess civil penalties. Environmental Petitioners further argue that, even if the affirmative defense against civil penalties for excess emissions resulting from unplanned SSM activity is not contrary to the CAA, the EPA's approval was arbitrary and capricious. Finally, Environmental Petitioners argue that, in approving the affirmative defense for unplanned SSM activity, the EPA altered the meaning of the SIP as submitted by Texas. We address each of these

arguments in turn.

 

    Industry Petitioners argue that the portion of the SIP revision containing the affirmative defense for planned SSM activity fully complies with the CAA and should have been approved by the EPA. They further argue that the EPA's partial disapproval of the SIP revision was arbitrary, capricious, and contrary to law. In the alternative, Industry Petitioners argue that the EPA should have severed and approved the affirmative defense for planned startup and shutdown activity, even if it disapproved the affirmative defense for planned maintenance activity. Industry Petitioners also request that approval of the SIP be backdated to June 30, 2006, so as to eliminate any gap between the expiration of the previous affirmative defense and the current affirmative defense.

    The Appeals Court ruled in part that, "EPA in its partial disapproval of the SIP revision adheres to its past policy guidance. Moreover, the record indicates that the EPA's partial disapproval of the plan was the result of a formal and deliberative decision-making process. Therefore, we hold that the agency's action disapproving the portion of the SIP providing an affirmative defense for planned SSM activity is entitled to Chevron deference."

 

    The Appeals Court also determined in part, ". . .we uphold the EPA's disapproval of the affirmative defense as it applies to planned startup and shutdown activity. Regardless of whether the activity at issue is planned maintenance or planned startup/shutdown, the improper cross-referencing in subsection (h) to subsection (c) leads to an overly-broad applicability of the defense. In addition, as stated, it is within the agency's discretion to exercise its partial approval and disapproval power with regard to SIP submittals."

 

    Finally, the Appeals Court concludes, ". . .we conclude that the EPA did not act arbitrarily or capriciously, contrary to law, or in excess of its statutory authority, in its partial approval and partial disapproval of Texas's SIP revision. We therefore deny the petitions for review submitted by both Environmental Petitioners and Industry Petitioners."

 

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