Commuter Rail Division v. STB

Jun 15: In the U.S. Court of Appeals, D.C. Circuit, Case No. 08-1346. Canadian Pacific Railway Corporation (CPR), along with its indirect subsidiary Soo Line Holding Company (Soo Holding), and Dakota, Minnesota & Eastern Railroad Corporation (DME), along with its subsidiary Iowa, Chicago & Eastern Railroad Corporation (ICE), (collectively Applicants) applied to the Surface Transportation Board (STB or Board) for approval of a merger in which Soo Holding (and indirectly CPR) was to acquire DME and ICE. They filed the application under 49 U.S.C. § 11324, which authorizes the Board to initiate a proceeding to approve various transactions within its jurisdiction, including the acquisition of one or more railroads by another railroad.

    The STB approved the acquisition. Metra, which operates two rail lines that are potentially affected by CPR's acquisition, and the Sierra Club seek review of the STB's decision approving the acquisition. Metra challenges the Board's refusal to attach "conditions" to the approval, in order to protect Metra's rights over its track line running north from Chicago toward Wisconsin over which Soo Holding has trackage rights and for which CPR is the dispatcher. Sierra Club challenges the Board's decision to defer preparation of an environmental impact study (EIS) until CPR decides whether to move forward with the construction of a line connecting DME's track in South Dakota to certain coal mines located in Wyoming's Powder River Basin (PRB).

 

    The Appeals Court dismissed Sierra Club's petition for lack of constitutional standing and denied Metra's petition because "the Board's approval of the merger was not an abuse of its discretion." On the Sierra Club challenge, the Appeals Court concludes: "Because Sierra Club has not shown, as it must, 'a causal connection between the government action that supposedly required the disregarded procedure' -- here, approval of the DME acquisition -- 'and some reasonably increased risk of injury to its particularized interest,' we dismiss its petition for lack of standing." The Appeals Court cites Fla. Audubon Soc'y v. Bentsen, 94 F.3d 658, 664 (D.C. Cir. 1996) (en banc).

 

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Lyondell Chemical Co v. Albemarle Corp

Jun 8: In the U.S. Court of Appeals, Fifth Circuit, Case No. 08-40060. Both sides to this appeal concede liability for environmental cleanup at a hazardous waste site near the Houston Ship Channel but fault the district court's equitable allocation of the associated costs. More specifically, the appeal concerns the reliability of expert witness testimony under Daubert [Daubert v. Merrell Dow Pharms., 509 U.S. 579 (1993)], the admission of alleged settlement communications into evidence, the district court's choice of methodologies in allocating costs, and some of the court's factual findings. The Appeals Court said, "We find error in the admission of settlement communications only and remand to the district court for further proceedings."

 

    A key point in the litigation involves the "Smythe Reports." The Appeals Court indicates that Occidental objected to the district court's admission of the Smythe Reports, which the district court used to develop the "intermediate" estimate of Occidental's waste. Occidental asserted that the reports are "settlement communications" inadmissible under Federal Rule of Evidence 408. That rule excludes from admission certain evidence "offered to prove liability for, invalidity of, or amount of a claim that was disputed as to validity or amount," including "conduct or statements made in compromise negotiations regarding the claim.

 

    In the conclusion, the Appeals Court said, "In sum, because admission of the Smythe Reports was harmful error, we affirm in part, reverse in part, and remand for further proceedings consistent with this opinion."

 

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USA v. Aerojet General Corporation

Jun 2: In the U.S. Court of Appeals, Ninth Circuit, Case No. 08-55996. In this important case involving the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the Appeals Court explains that "CERCLA requires certain polluters to pay for cleaning up contaminated sites. After identifying a contaminated site, U.S. EPA and state environmental agencies typically negotiate with potentially responsible parties (PRPs) over their shares of comparative responsibility for cleanup costs. CERCLA allows PRPs to seek contribution from one another in order to apportion response costs equitably. But CERCLA bars contribution claims against PRPs that have obtained administratively or judicially approved settlements with the government. CERCLA thus provides an incentive for PRPs to settle by leaving non-settling PRPs liable for all of the response costs not paid by the settling PRPs."

 

    The Appeals Court said, "We consider a question that has split the federal courts: May a non-settling PRP intervene in litigation to oppose a consent decree incorporating a settlement that, if approved, would bar contribution from the settling PRP? We join the Eighth and Tenth Circuits in holding that the answer is 'yes.'" In its conclusion the Appeals Court rules, ". . .we hold that Applicants have a right to intervene under Rule 24(a)(2) and § 113(i) of CERCLA to protect their interests in contribution and in the fairness of the proposed consent decree. We therefore reverse and remand for further proceedings consistent with this opinion."

 

    Explaining further, the Appeals Court says, "Under Rule 24(a)(2), Applicants bear the burden of showing that their interests are not adequately represented by the existing parties. Under § 113(i), the government bears the burden of showing the non-settling PRPs' interests are adequately represented. Under either standard, we conclude that the interests of the non-settling PRPs are not adequately represented by the existing parties." And, the Appeals Court says, ". . .§ 113(i) confers a right to intervene on 'any person' who 'claims an interest' in the litigation, should the disposition of the action 'impair or impede' that interest. Section 113(i) contains no restriction on intervention by non-settling PRPs. See Union Elec., 64 F.3d at 1165. Nor does the right of intervention in § 113(i) need to be restricted in order to give effect to the contribution provisions of § 113(f). Indeed, precisely because § 113(f)(2) cuts off the contribution right of nonsettling PRPs, § 113(i) gives them the right to intervene upon timely application. We therefore hold that Applicants have significant protectable interests that support intervention as of right."

 

    In its opinion, the Appeals Court references the 8th & 10th Circuit cases, which have held that such PRPs have interests sufficient to support intervention as of right, and some of the competing district court ruling: "See United States v. Albert Inv. Co., Inc., 585 F.3d 1386 (10th Cir. 2009); United States v. Union Elec. Co., 64 F.3d 1152 (8th Cir. 1995). District courts have split on the question. Compare United States v. Acorn Eng'g Co., 221 F.R.D. 530, 534-39 (C.D. Cal. 2004) (holding interest not legally sufficient to support intervention as of right), United States v. ABC Indus., 153 F.R.D. 603, 607-08 (W.D. Mich. 1993) (same), and Arizona v. Motorola, Inc., 139 F.R.D. 141, 145-46 (D. Ariz.1991) (same), with United States v. Exxonmobil Corp., 264 F.R.D. 242, 246-48 (N.D. W. Va. 2010) (holding interest legally sufficient); United States v. Acton Corp., 131 F.R.D. 431, 433-34 (D.N.J. 1990) (same)."

 

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Butte Environmental Council v. U.S. Army Corps

Jun 1: In the U.S. Court of Appeals, Ninth Circuit, Case No. 09-15363. The Appeals Court indicates that it must decide whether the decisions of two Federal agencies approving the construction of a business park on protected wetlands in California were arbitrary and capricious. The statutes involved are the Clean Water Act (CWA and the Endangered Species Act (ESA).

 

    After years of researching potential sites for economic development, the City of Redding, California, decided to construct a business park on a 678-acre site located on wetlands along Stillwater Creek, and started to draft an environmental impact statement (EIS). The proposed site contains critical habitat for several ESA-listed species under the jurisdiction of the Secretary of the Interior, including the threatened vernal pool fairy shrimp, the endangered vernal pool tadpole shrimp, and the threatened slender Orcutt grass. The ESA-listed species occupy the site's vernal pools -- shallow depressions that fill with rainwater in the fall and winter and then dry up in the spring.

 

    Butte Environmental Council filed suit against the Corps, FWS and the City in federal district court. The Council sought judicial review under the Administrative Procedure Act (APA), of the Corps' decision to issue a permit for the City's proposed project and the FWS's biological opinion that the project would not adversely modify the critical habitat for endangered and threatened species.

 

    The district court granted summary judgment in favor of the agencies and the City. It held that "the Corps was neither arbitrary nor capricious when rationally concluding the Stillwater site was the [least environmentally damaging practicable alternative]," and that the FWS's biological opinion stated "a rational connection between the facts found and the conclusion reached." The Appeals Court affirmed the judgment of the district court.

 

    In reviewing the CWA issues, the Appeals Court said, "In sum, the Corps stated a rational connection between the facts found and the conclusion that the proposed Stillwater site was the least environmentally damaging practicable alternative. We therefore conclude that the Corps' decision to issue the City a permit was neither arbitrary nor capricious." The Appeals Court ruled on a number of sub-issues related to the ESA claims; however it said, "We therefore reject the Council's contention that the FWS applied a definition of 'adverse modification' that ignored the value of critical habitat for the recovery of the affected species."

 

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Coalition Of Battery Recyclers v. U.S. EPA

In the U.S. Court of Appeals, D.C. Circuit, Case No. 09-1011, Consolidated with No. 09-1012. The Appeals Court said upon review of the air quality criteria and national ambient air quality standards (NAAQS), U.S. EPA revised the primary and secondary NAAQS for lead when it issued a final rule in November 2008 [See WIMS 10/16/08]. The revision was designed to provide, in light of recent science, the requisite protection of public health and welfare by revising the permissible level of lead in ambient air and revising the averaging time over which the level must be met.

 

    The final rule also revised data handling procedures and emissions inventory reporting requirements and provided guidance on implementation. The Coalition of Battery Recyclers Association and the Doe Run Resources Corporation (together the petitioners) contend EPA action was arbitrary and capricious in multiple ways. The Appeals Court ruled, "Upon review of the rulemaking record, we are unpersuaded and we deny the petitions for review."

   

    Petitioners assert that the revised primary lead NAAQS is overprotective, contending that (A) EPA did not provide sufficient record support for basing the standard on preventing a decrease of more than two IQ points, (B) reliance on particular studies relating blood lead levels and IQ was arbitrary and capricious, and (C) selection of a lead standard of 0.15 µg/m3 was arbitrary and capricious when measured as an average over a rolling three-month period.

 

    However, the Appeals Court said, "Consistent with our standard of review, see Lead Indus. Ass'n v. EPA, 647 F.2d 1130, 1145–48 (D.C. Cir. 1980); 42 U.S.C. § 7607(d)(9), we conclude these contentions lack merit because there is substantial record evidence to support EPA's conclusions that the population of children exposed to air lead levels above the revised NAAQS could suffer, and should be prevented from suffering, average losses of more than two IQ points, that greater incremental IQ loss occurs at lower relative blood levels and the more relevant IQ analyses are those of children with blood levels closest to today's population of children, and that a standard of 0.15 µg/m3 measured as a three-month rolling average is required to protect

public health with an adequate margin of safety."

   

    The Appeals Court explained its ruling further, "Applying the familiar two-step analysis under Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), see Natural Res. Def. Council v. EPA, 489 F.3d 1364, 1371 (D.C. Cir. 2007), we conclude Doe Run's contention fails at both steps. First, Congress provided in the Clean Air Act that primary NAAQS 'shall be ambient air quality standards the attainment and maintenance of which in the judgment of the Administrator . . . are requisite to protect the public health.' 42 U.S.C. § 7409(b)(1). EPA is required to designate 'any area that does not meet (or that contributes to ambient air quality in a nearby area that does not meet) the national primary or secondary ambient air quality standard for the pollutant' as 'nonattainment.' Id. § 7407(d)(1). Further, EPA 'may not promulgate a redesignation of a nonattainment area (or portion thereof) to attainment unless' it 'determines that the area has attained the national ambient air quality standard.' Id. § 7407(d)(3)(E)(i).

 

    "Additionally, Congress addressed the circumstances under which attainment could be waived, e.g., as with certain particulate matter sources, see 42 U.S.C. § 7513(f), and with emissions emanating from outside the United States, see 42 U.S.C. § 7509a, but provided no authorization for EPA to waive NAAQS attainment requirements in the manner requested by Doe Run. Even assuming the Clean Air Act was ambiguous with regard to whether EPA was empowered to grant other waivers, EPA's interpretation of its authority under the statutory scheme is permissible under Chevron step two, 467 U.S. at 843, and entitled to deference by the court. Accordingly, we deny the petitions."

 

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WildEarth Guardians v. National Park Service

May 12: In the U.S. Court of Appeals, Tenth Circuit, Case No. 08-1479. According to the Appeals Court, the appeal arises from WildEarth Guardians' lawsuit challenging the National Park Service's proposal to reduce the elk population in Rocky Mountain

National Park. Safari Club International and Safari Club International Foundation (referred to together as Safari Club) are two organizations representing hunting and conservation interests which participated in the administrative proceedings that led to the promulgation of the National Park Service's elk population management plan. Safari Club sought to intervene as of right in WildEarth's lawsuit as a party defendant pursuant to Federal Rule of Civil Procedure 24(a)(2), or, in the alternative, to intervene permissively, under Federal Rule of Civil Procedure 24(b).

 

    The district court denied Safari Club's motion to intervene and Safari Club appealed. The Appeals Court said, "Because '[a]n order denying intervention is final and subject to immediate review if it prevents the applicant from becoming a party to an action,' Coal. of Ariz./N.M. Counties for Stable Econ. Growth v. DOI, 100 F.3d 837, 839 (10th Cir. 1996), we have jurisdiction under 28 U.S.C. § 1291. We find the district court erred in ruling on Safari Club's motion to intervene. Safari Club demonstrated that it has a substantial interest in the district court proceedings and that its interest might be impaired as a result of the litigation. Further, on the record presented, we decline to determine whether any of the existing parties can adequately represent Safari Club's interest.

Accordingly, we reverse and remand with instructions to consider whether the National Park Service can adequately represent Safari Club's interest."

 

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Copar Pumice Co., Inc. v. Tidwell

Apr 19: In the U.S. Court of Appeals, Tenth Circuit, Case No. 07-2211. Petitioner-Appellant Copar Pumice Company, Inc. (Copar), proceeding under the Administrative Procedure Act, (APA), appeals the district court's denial of its petition for review concerning the Notice of Noncompliance that the United States Forest Service (FS) issued to Copar

concerning its pumice mining activities. The Appeals Court affirmed the district court's denial.

 

    By way of background, Copar operates the El Cajete pumice mine on four unpatented mining claims located within the Jemez National Recreation Area in New Mexico. Pursuant to a written settlement agreement with the FS, Copar may extract pieces of pumice in excess of 3/4 inches in size "subject to all pertinent statutes and regulations." Copar's +3/4" pumice is an "uncommon variety" of pumice that has a distinct and special value as a stonewashing agent in the garment finishing industry: the pumice "abrade[s] denim fabric, especially jeans, by creating a worn look on new denim fabric."

 

    After El Cajete mining operations began, the FS learned that Copar was not exclusively selling its +3/4" pumice to the garment finishing industry; rather, Copar was selling some of its +3/4" pumice to other industries for common variety uses. The FS claimed that this practice violated the applicable regulations, as well as the settlement agreement. Copar disagreed, and the FS eventually issued Copar a Notice of Noncompliance.

 

    The Appeals Court ruled, "Copar acknowledged in the settlement agreement that it had no right to extract common variety pumice from El Cajete. Because it was not arbitrary and capricious for the FS to conclude that the portion of Copar's +3/4" pumice that is not destined for the garment finishing industry is common variety pumice, Copar had no right to extract common variety pumice, and therefore no taking occurred."

 

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