Friday, July 29, 2005

Damages for Nothing

Some of the most interesting cases in environmental law arise when contamination does not occur. Two such cases came across my desk recently. In Doyle v. Town of Litchfield, 2005 WL 1342794 (D. Ct. May 31, 2005), Judge Hall held on a summary judgment motion that a property owner may be entitled to recover some CERCLA response costs even though his property had not been contaminated by the defendant's release of hazardous substances. The court cited Artesian Water Co. v. New Castle County, 851 F.2d 643 (3rd Cir. 1988), and Lansford-Coaldale Joint Water Auth. v. Tonolli Corp., 4 F.3d 1209 (3rd Cir. 1993), and concluded that a plaintiff may recover monitoring and evaluation costs under CERCLA, even if no contamination ever occurred.

A similar question was presented in Jaasma v. Shell Oil Co., No. 04-2095 (3rd Cir. June 28, 2005). There the plaintiff owned property that was leased for a service station. When the lessee removed its tanks shortly before the lease expired, some contamination was found in the tank pit and partially excavated. After more than two years of sampling and reporting, the New Jersey Department of Environmental Protection issued a no further action letter, without ordering any further active remediation, which implied that the contamination that remained at the lease expiration (i.e., after the tank removal and excavation) had always been below the level requiring cleanup. The Third Circuit held that despite these facts the lessor was entitled to damages. The lease required lessee to return the property to lessor in its "original state," and, the court held, that there was a question of fact whether lessee was required to obtain a no further action letter in order to satisfy that requirement.

While the Town of Litchfield could not have avoided Doyle's claim, the claim in Jaasma resulted entirely from the language of the lease. While perhaps no one could have anticipated the Third Circuit's ruling, it is something to keep in mind the next time that you are reviewing the environmental provisions of a lease.

Monday, July 25, 2005

The Oldest Question In Environmental Law

The oldest question in environmental law is "how clean is clean?" It's a question that environmental practitioners are tired of discussing, and that quickly leads to glazed eyeballs at any environmental meeting. So I shouldn't be discussing it -- but there is a new development worth notice. Under state law, the Regional Water Quality Control Boards have a two-part cleanup target for contaminated groundwater: clean up to background levels, or to health-based levels, such as the maximum contaminant level (drinking water standard) or public health goal. Which of these goals (background or health) is selected for a particular site is not often an issue of substantial dispute because in practice usually neither of them can be achieved, at least with active remediation in a reasonable time.

In May, however, the State Water Resources Control Board confronted the issue in a context where the issue does have practical consequences: should a "discharger" be required to provide alternate water supplies to persons affected by contamination that is below health standards but higher than the naturally occurring level? The case involved an Olin Corporation site in Morgan Hill, and the chemical was potassium perchlorate, which occurs naturally, if at all, only at undetectable levels. Olin and another discharger were ordered by the Regional Board to provide alternate drinking water supplies to residents whose water contained perchlorate at or above 4 ppb, even when the level of perchlorate was below the new public health goal of 6 ppb established by OEHHA. The PHG is supposed to be a level at which a person may be exposed to a chemical for a lifetime with no deleterious effects.

The State Board decided that in this context the Regional Boards should defer to OEHHA, and should not require a discharger to provide an alternate water supply. The decision includes many caveats, and the State Board expressly limits its opinion to replacement water supply decisions ("This Order applies only to requirements for water replacement and not to groundwater or soil cleanup levels required under State Water Board Resolution 92-49"), but the decision nevertheless seems to mark an important choice. The Board could have required Olin to continue providing alternate drinking water supplies, even without a health-based reason to do so. But it chose instead to conserve societal resources for another day and another threat, a threat supported by scientific evidence.

Friday, July 22, 2005


Can CERCLA be used to recover response costs incurred in a foreign nation? No is the answer, by implication from a recent case decided by the Ninth Circuit, Arc Ecology v. United States Dept of the Air Force, in which Philippine plaintiffs sought to compel the United States to conduct a preliminary assessment of Subic Bay and Clark Air Force Base in the Philippines. The Ninth Circuit found no express answer to the question of extraterritoriality in the statute, but the law presumes that a statute will be applied only within the territory of the United States. The court also found many provisions of CERCLA that suggested that Congress was thinking of the United States when it passed CERCLA.

Friday, July 08, 2005

Weird Science

One of the things that often leaves out-of-staters speechless about California is Proposition 65. It's not that a citizens group can sue a company for failing to warn of the presence of a chemical in a product that bothers out-of-staters, it is that there is no agreed safe level above which a warning is required. Prop 65 allows a product seller to forego a warning if there is "no significant risk," but determining whether there is significant risk is an expensive science project. To a single product seller, that science project usually isn't worth the money. The end result is that in deciding whether to place a warning on a product, a seller usually ignores the likely dose, and therefore ignores the true risk. Thus, Proposition 65 encourages companies to place warnings on products that, practically speaking, don't pose a threat to anyone, and that often pose very small or nonexistent risks in relation to the real toxicological risks that people face everyday, such as drugs, smoking, air pollution and workplace exposures to chemicals. There is no prioritization of risks under Proposition 65. Sometimes enforcers go after real risks and sometimes not, and there is no regulatory authority to guide enforcement towards real risks.

The absence of prioritization is becoming clearer now as OEHHA (Office of Environmental Health Hazard Assessment) struggles to deal with acrylamide in foods. Acrylamide is produced in many foods, such as bread and french fries, when they are cooked. The levels present in cooked foods are many times higher than the levels that OEHHA has determined to pose no significant risk. The food industry is pushing to exempt acrylamide in cooked foods from Prop 65's warning requirement on the grounds that the acrylamide is "naturally occurring," while environmentalists are arguing that OEHHA has no authority to create an exemption.

Whoever prevails, the argument just highlights the arbitrariness of Prop 65 warnings. There are no warnings under Prop 65 on naturally occurring carcinogens in peanut butter and many other foods, but there are warnings, when you get into an elevator in California for example, that point out that there is a theoretical risk from chemicals in indoor air. Now we may get a warning that bread is "known to the State of California to cause cancer." It is highly unlikely that a rational regulatory agency would structure enforcement in this manner.