The issues before the Supreme Court in Sackett v. EPA were (1) whether the Sacketts, [the petitioners the case] could seek pre-enforcement judicial review, pursuant to the Administrative Procedure Act, 5 U.S.C. § 704 (“APA”), of an administrative compliance order issued by the EPA; and (2) whether, if not, their inability to seek pre-enforcement judicial review of the administrative compliance order violates their rights under the Due Process Clause?

Case History: Approximately four (4) years ago, the EPA issued a compliance order against Mike and Chantell Sackett, charging them with violating the Clean Water Act by filling in a portion of their property allegedly containing a jurisdictional wetland. The compliance order required that the Sacketts restore their property to its alleged predisturbance wetlands condition and also imposed upon them the threat of tens of thousands of dollars per day in civil fines if they did not immediately comply with the order.

The Sacketts petitioned EPA for a hearing to challenge the wetland determination, and after EPA refused, filed suit in district court. EPA argued that review of an agency order was barred unless the agency first sued and insisted that the Sacketts comply with the order, threatening penalties if they did not. The district court agreed, and dismissed the Sacketts’ suit for lack of jurisdiction. The Sacketts then appealed to the Ninth Circuit, who affirmed the district court. The Sacketts appealed the matter to the Supreme Court, who granted cert on June 28, 2011.

Legal Framework: The CWA and its implementing regulations provide the EPA [and the Corps of Engineers] with a number of different mechanisms by which to enforce the CWA’s prohibition on discharging pollutants into regulated waters. As relevant here, when EPA finds that any person is in violation of Section 1311 of the CWA [the provision prohibiting unauthorized discharges of pollutants into navigable waters of the United States], the agency shall either issue an administrative compliance order pursuant to 33 U.S.C. Section 1319(a)(3) requiring the person to comply with such section or requirement [the instant case], or bring a civil action to enforce the Act pursuant to Section 1319(b). Section 1319(b) authorizes EPA to initiate a judicial enforcement action for appropriate relief, including a temporary or permanent injunction for any violation for which EPA is authorized to issue a compliance order under Section 1319(a). In an action brought under Section 1319(b), the district court may also impose civil penalties for violation of the CWA and for violation of an administrative compliance order issued pursuant to Section 1319(a)(3). The CWA provides for civil penalties up to $37,500.00 per day for both violation of the CWA and violation of administrative compliance order.

Stated another way, when the EPA believes that a landowner has engaged in a violation of environmental laws, it may issue an administrative compliance order requiring the landowner to take certain actions. If the landowner does not comply with the administrative compliance order, the EPA may seek judicial enforcement of the order (and seek penalties for both the alleged violation of the CWA and non-compliance with the administrative compliance order). This puts parties who contest the validity of the allegations against it, in a bad situation because currently, a party must wait until the EPA seeks judicial enforcement of an administrative compliance order before the landowner can challenge the order, thus exposing itself to potential penalties for non-compliance with the order.

Conclusion: The decision in Sackett v. EPA could alleviate the threat of potential penalties for non-compliance with an order by allowing for direct judicial appeal of administrative compliance orders. In that way, alleged CWA violators would essentially “get their day in court” to argue the EPA’s finding of jurisdictional wetlands instead of being forced to comply with the order or face the threat of penalties for not complying with the order while waiting to see if the EPA will seek to enforce the order.

Like many environmental practitioners, we have a personal interest in the outcome of the Sackett case, because we represent a client in almost identical procedural circumstances as the Sacketts. In fact…our client even has the same environmental consultants as the Sacketts, Ray and Susan Kagel. If oral arguments are any predictor of how the Supreme Court may rule in this case, things may be looking up for the Sacketts.

We were very excited to find out that Morrison’s Cert Petition has made The Supreme Court of the United States Blog’s (SCOTUSblog) “Petitions to Watch” list for the Supreme Court’s September 26th conference.   To read Morrison’s Cert Petition as well as the Brief of Amici Curiae Pharmacia Corporation (F/K/A Monsanto Company) and Solutia Inc. in Support of Morrison’s Cert Petition, follow the link below. 

http://www.scotusblog.com/2011/09/petitions-to-watch-conference-of-september-26-2011-2/

The 2009 Appleton I litigation and its outcome was unique because rather than considering  the usual so-called “equitable factors” to determine proportionate financial responsibility such as waste-in volume or  relative contaminant toxicity, the District Court focused entirely on a single marker of relative culpability i.e., the Plaintiff’s knowledge that their actions might cause environmental harm.  

The Plaintiffs in Appleton I (NCR and Appleton Papers Inc. who were found liable as successors to their respective predecessors in interest i.e., Appleton Coated Paper Company, hereinafter collectively the “Appleton I Plaintiffs”) generated and disposed of a PCB-laden waste stream associated with an emulsion used to manufacture carbonless copy paper.  The Appleton I Plaintiffs were aware that the production of carbonless copy paper, the generated PCB contaminated waste and the sale of the waste product from the paper’s production (a product known in the industry as “bloke”) to the defendant, George A Whiting (“Whiting”) would potentially cause environmental harm.  

Faced with an evidentiary record leaving little doubt about the Appleton I Plaintiff’s knowledge regarding the hazardous nature of the waste materials involved, the District Court determined that a largest percentage release of PCB contaminated material into the environment occurred at the time that the Appleton I Plaintiffs had actual knowledge that a release of the waste material could cause environmental harm.  Therefore, the District Court held that the Appleton I Plaintiffs were not entitled to contribution from Whiting because the Appleton I Plaintiffs knowingly released PCB contaminated materials with the full understanding that the releases would likely result in long-lasting harmful environmental consequences.

In February of 2011, the District Court issued an equally intriguing opinion in Appleton Papers Inc., v. Whiting Paper Co., No. 08-C-16, 41 ELR 2011 (E.D. Wis. Feb. 28, 2011) (hereinafter “Appleton II”).   Relying in large measure on the District Court’s 2009 decision, multiple defendants including Whiting Paper Co., and others (hereinafter the “OU2-OU5 Defendants”) and WTM I Company and the P.H. Glatfelter Company WTMI Co., (hereinafter “OUI Defendants”)  argued that the response costs already contributed to cleanup effort should be borne by NCR Corp. and Appleton Papers Inc., (hereinafter Appleton II Plaintiffs).  All of the Defendant’s arguments highlighted the same equitable factor that barred the Appleton I plaintiffs from obtaining contribution it, e.g., knowledge.

After reviewing the totality of the circumstances, the District Court determined that that the OU2-OU5 Defendants were entitled to full contribution from the Appleton II Plaintiffs for four of the five “operable units” situated along the Lower Fox River but, that the Appleton II Plaintiffs were not liable for the cost of cleaning up the contamination at Operable Unit I (“OU1”), and therefore were not liable to the OU1 Defendants for response costs approaching $110 million.

In reaching this conclusion, the District Court noted that the question of “site divisibility” is not properly a part of a contribution action under CERCLA §113 and that in a CERCLA §113 contribution action among PRPs, “. . . the divisibility defense has no relevance as a ‘defense’” Appleton Papers Inc., v. Whiting Paper Co., No. 08-C-16, 41 ELR 2011, 10 (E.D. Wis. Feb. 28, 2011). [1]    Instead, the District Court determined that the fact that the Appleton II Plaintiffs did not physically release toxins into OUI was an equitable factor that fit within the framework of a CERCLA §113 analysis.  The District Court further explained that it did not agree with the OUI Defendant’s contention that the CERCLA §113 proceeding was not the proper forum to address the Appleton II Plaintiff’s liability, and that the OUI Defendants had not provided “. . . any authority upon which [the District Court] could base a contribution award when none of the CERCLA §107 types of liability applied in this case” (Id. at 12).    The District Court explained that unless the OUI Defendants could later provide evidence that the Appleton II Plaintiffs were arrangers under CERCLA §107; as the District Court determined that whether the Appleton II Plaintiffs were arrangers was a question that could not be answered at that stage of the proceeding, that the Appleton II Plaintiffs were not liable for costs associated with OUI (Id. at 2).

Further, the District Court also examined the location of the site, explaining, that, “. . . no one would argue that [the Appleton II Plaintiffs] could be liable for contribution at far-distant sites for which they had no § 107 liability, and thus it is difficult to see how they could be liable merely because OU1 happens to be attached to the rest of the Lower Fox River Site” (Id. at 12).     

The Appleton cases are important to practitioners as they express the ultimate objective of the CERCLA liability scheme i.e., that the polluter pays the costs of resolving the pollution it causes.  Based on the outcomes of these two cases, it seems that a court, sitting in equity, can utilize whatever reasonable factors it has available in order to ensure that the party that caused the pollution is the party that will pay to clean up the pollution.   In doing so the court may ignore artificial constraints such as government imposed geographic contaminant zone descriptions or the identity of contaminant sources.  In 2009, the District Court utilized the equitable factor of knowledge of ultimate harm to assign liability to the Appleton I Plaintiffs  and in 2011; the Court relied upon the absence of geographic proximity of release locations to establish an  “equitable factor” to limit the reach of CERCLA §113 liability for the Appleton II Plaintiffs.  In short, if a court believes that a defendant in a contribution case has no demonstrable causal responsibility for the harm triggering the response cost claim, there can be no contribution recovery.  The fact based focus of inquiry and proof may well be the undoing of efforts to rely upon supposed technical and legal attributes of relative responsibility rather than what should be the essential inquiry at the root of the CERCLA legislative cost recovery scheme e.g., the polluter should pay for the pollution it caused to occur. 

Some key 2012 budget initiatives include:

$350 million for projects strategically chosen to target the most significant threats to people’s health in the Great Lakes ecosystem, a $125 million decrease from FY 2010, the first year of the initiative.

$2.5 billion–a decrease of $947 million– combined for the Clean Water and Drinking Water State Revolving Funds (SRFs).  EPA will continue to work with states and communities to enhance their capacity to provide clean water and safe drinking water to Americans. Federal dollars provided through SRFs will help spur efficient system-wide planning and ongoing management of sustainable water infrastructure.

$1.2 billion for the Superfund program to support cleanup at hazardous waste sites that addresses human health and environmental hazards at the nation’s highest priority sites.  While EPA will be exploring efficiencies in the program, the $70 million reduction to Superfund programs will slow the pace of new projects and completion of projects.

$27.5 million increase in enforcement and compliance, allowing for critical investments to increase efficiencies and streamline enforcement by using the latest e-reporting and monitoring tools. EPA will increase oversight and inspections at high risk chemical and oil facilities in order to protect Americans’ health.    

$16.1 million more to reduce chemical risks, increase the pace of chemical hazard assessments, and provide the public with greater access to chemical information so they can make better informed decisions about their health. Learning more about these chemicals will help protect Americans from potential threats to their health.

$1.2 billion for state and tribal grants — an overall increase of $84.9 million over FY 2010. This funding will help communities take steps to meet the pollution standards EPA has developed under the Clean Air Act and the Clean Water Act.

An additional $46 million for regulatory efforts to reduce greenhouse gas (GHG) pollution and implement GHG reporting requirements under the Clean Air Act.  This includes $25 million for states and $5 million for EPA to address GHGs in Clean Air Act permitting activities.

$67.4 million to support EPA’s efforts to clean up America’s great water bodies, specifically in the Chesapeake Bay. This water body serves as an economic engine for an entire region of the country, and millions of Americans rely on it for access to clean, safe water. Investing in these waters will help local economies and protect Americans’ health.

$584 million to support research and innovation into new and emerging environmental science. This includes a $24.7 million increase to Science to Achieve Results (STAR) grants to ensure that EPA is using the best science to protect the air we breathe, the water we drink and the land we build our communities on. EPA’s research program is being restructured to ensure that scientific work is conducted more efficiently and effectively.

Read More.

Under section 108(a) of the Clean Air Act (CAA), the Administrator identifies and lists certain pollutants which “cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare.”   The EPA then issues air quality criteria for these listed pollutants, which are commonly referred to as “criteria pollutants.”  The air quality criteria are to accurately reflect the latest scientific knowledge useful in indicating the kind and extent of  all identifiable effects on public health or welfare which may be expected from the presence of [a] pollutant in the ambient air, in varying quantities.”  Under section 109 of the CAA, EPA establishes primary (health-based) and secondary (welfare-based) national ambient  air quality standards (NAAQS) for pollutants for which air quality  criteria are issued. Section 109(d) of the CAA requires periodic review  and, if appropriate, revision of existing air quality criteria. The  revised air quality criteria reflect advances in scientific knowledge on the effects of the pollutant on public health or welfare. The EPA is also required to periodically review and revise the NAAQS, if  appropriate, based on the revised criteria.  Read More.

Since May 2009, EPA has been conducting on-site assessments of coal ash impoundments and ponds at electric utilities. EPA provides copies of the structural integrity assessment reports to each facility, and requests the facilities implement the reports’ recommendations and provide their plans for taking action. The action plans released today address recommendations from assessments of 37 impoundments at 15 facilities. Many of these facilities have already begun implementing EPA’s recommendations.

In addition to the action plans, EPA is also releasing assessment reports on the structural integrity of an additional 69 coal ash impoundments at 20 facilities across the country. Of these units, 35 were given a “poor” rating and none of the units received an “unsatisfactory” rating, which is the lowest possible EPA rating. The poor ratings were given because these units lacked some of the necessary engineering documentation required in the assessments, and not because the units are unsafe.  Based on analysis from the engineers who conducted the assessments, the ratings for these units are likely to improve once the proper documentation is submitted.

The assessment reports have been completed by firms, under contract to EPA, who are experts in the field of dam integrity, and reflect the best professional judgment of those engineering firms. A draft of these reports has been reviewed by the facilities and the states for factual accuracy. The comments on the draft reports are also posted on EPA’s website. EPA is continuing to review the reports and technical recommendations, and is working with the facilities to ensure that the recommendations are implemented in a timely manner. Should facilities fail to take sufficient measures, EPA will take additional action, if the circumstances warrant. EPA will continue to provide additional information to the public on the impoundments and facilities as it becomes available.

Last year, EPA completed comprehensive assessments for 60 impoundments that were considered to have a high risk of causing harm if the impoundment were to fail. The agency is now in the process of evaluating the remaining impoundments and will continue to make its assessments and the facility action plans available to the public.

EPA is also in the process of developing the first-ever national rules to ensure the safe disposal and management of coal ash from coal-fired power plants. The proposed regulations will ensure stronger oversight of the structural integrity of impoundments, and protection of human health and the environment. The agency is evaluating more than 400,000 public comments on the proposed rule, which was released in May 2010.  Read More.

In a separate action, the agency is also moving towards establishing a drinking water standard to address a group of up to 16 toxic chemicals that may pose risks to human health. As part of the Drinking Water Strategy laid out by Administrator Jackson in 2010, EPA committed to addressing contaminants as a group rather than one at a time.  Read More.

The current health standards are 9 parts per million (ppm) measured over 8 hours, and 35 ppm measured over 1 hour. To ensure people are protected from high concentrations of CO and to develop better information about CO and its health impacts, EPA is proposing to revise the air monitoring requirements.  The proposed changes would require a more focused monitoring network with CO monitors placed near highly trafficked roads in urban areas with populations of 1 million or more. The data from these sites would be available for scientific studies that could help inform future reviews of the standard. 

EPA estimates that the proposal would require approximately 77 CO monitors in 53 urban areas.  EPA expects that states would not need to purchase new monitoring equipment. They could relocate some of their existing CO monitors to the near-road monitoring stations already required in connection with the revised nitrogen dioxide standards issued in January 2010. CO monitors at the new locations would be required to be operational by January 1, 2013.

The proposed rule only addresses the primary CO standards and is consistent with the advice and recommendations from the agency’s independent science advisors, the Clean Air Act Scientific Advisory Committee. 

EPA will accept comments for 60 days after the proposed rule is published in the Federal Register. If requested, the agency will hold a public hearing on the proposed rule on Feb. 18, 2011. EPA will take final action by Aug. 12, 2011.  Read More.

Vapor intrusion describes the migration of volatile chemicals from contaminated groundwater or soil into the atmosphere, and is a particular concern if vapors enter an overlying building.
 
EPA is accepting public feedback on seven specific topics related to the potential revisions to the Hazard Ranking System (HRS), which is used to evaluate sites for the Superfund list, for 75 days. The agency will consider information gathered during the comment period, as well as input from three public listening sessions before making a decision on whether to issue a proposed rulemaking to add a vapor intrusion component to the HRS.  Read More.