Author: Paul M. Hauge

No, That Doesn’t Settle It: U.S. Supreme Court Clarifies Which Types of Settlements Trigger CERCLA Contribution Rights

The complex and overlapping nature of the three different routes to recovering cleanup costs under the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) has bedeviled courts for decades. This month, in Territory of Guam v. United States, the U.S. Supreme Court answered one very narrow question: What kind of a settlement with the government gives a settling party the right to bring an action for contribution against a non-settlor?

NJDEP Amends Site Remediation Standards

Via a New Jersey Register notice published on May 17, 2021, the New Jersey Department of Environmental Protection (NJDEP) has amended the remediation standards that govern all cleanups in the state. It is the most sweeping revision of the standards since they were first adopted in 2008. NJDEP proposed the amendments in April 2020 and held a virtual public hearing on July 21, 2020. During an extended public comment period, NJDEP received more than 270 public comments on its proposal. The proposal itself was preceded by a series of stakeholder sessions stretching back to 2014. The rulemaking makes significant changes to the remediation standards, including: The creation of separate residential and non-residential soil remediation standards for the ingestion-dermal and inhalation exposure pathways; formerly, the applicable standard was the more stringent of the two, but now both pathways will need to be considered. The adoption of new soil remediation standards for the migration to groundwater exposure pathway, replacing the former site-specific approach based on NJDEP guidance with enforceable standards. The adoption of new standards for soil leachate (for the migration to groundwater exposure pathway) and indoor air (for the vapor intrusion exposure pathway); the vapor intrusion standards replace the former screening levels based on NJDEP guidance. The tightening of some standards and the loosening of others....

Show Me the Study: New Jersey Appellate Division Reverses Verdict in Talcum Powder Tort Case Because Causation Testimony of Plaintiffs’ Experts Had No Scientific Basis

Whether in environmental litigation (as we reported here) or in tort cases, expert testimony is often required to explain complex scientific concepts and, crucially, to establish a causal connection between exposure to a given substance and an adverse health or environmental effect. In its recent decision in Lanzo v. Cyprus Amax Minerals Company, the New Jersey Appellate Division reminded litigants of the importance of the court’s “gatekeeping” function when it tossed out a nine-figure judgment because the trial court had admitted testimony from the plaintiffs’ experts that lacked a proper scientific basis. The appellate court also held that the trial court had erred when it denied the motion for a separate trial of one defendant who was likely harmed by an adverse inference instruction that was required because of another defendant’s spoliation of important evidence. The plaintiffs, a husband and wife, had sued Johnson & Johnson Consumer Inc. (JJCI), Imerys Talc America, Inc. (Imerys), and a large number of other defendants in 2016, alleging that the husband had contracted mesothelioma from his use of JJCI’s talcum powder products. Imerys had acquired a business that supplied talc to JJCI in 2011. The key issues in the case were whether the talc used by JJCI contained asbestos, which is known to cause mesothelioma, and whether certain other...

Sez Who? Appellate Division Questions Expert’s Qualifications to Testify in Spill Act Case

New Jersey’s Spill Compensation and Control Act (“Spill Act”) makes dischargers of hazardous substances, as well as persons “in any way responsible” for the discharged hazardous substances, liable in contribution to a person who remediates the discharge. Since the statute’s enactment in 1976, courts have often been called on to define limits on the category of parties who can be held responsible, especially the vague sub-category of persons “in any way responsible.” In its recent unpublished decision in Dorrell v. Woodruff Energy, Inc., the Appellate Division held that a supplier could not be held liable as a person “in any way responsible” simply for delivering fuel to the site in question. Reviewing the evidence presented in the trial court about another defendant’s potential liability, the court provided important guidance for both plaintiffs and defendants on the appropriate role of expert witnesses in Spill Act cases. The plaintiff, Sandra Dorrell, owned a store in Alloway Township. When she sought to sell the property, she discovered petroleum contamination in the soil and groundwater. She filed suit in 2011 to seek contribution from the parties she considered responsible for the contamination: Woodruff Energy, Inc. (“Woodruff”), Gulf Oil Limited Partnership (“Gulf”), and Chevron U.S.A. Inc. (“Chevron”), Gulf’s successor. The case had been to the Appellate Division once already, resulting...

NJDEP Continues Environmental Justice Rulemaking Process With Second Stakeholders Meeting

As we previously reported, the New Jersey Department of Environmental Protection (NJDEP) has embarked on a robust process for soliciting public input on the regulations it will propose to implement in the state’s landmark environmental justice law, which was enacted last year (and which will not become effective until NJDEP promulgates its regulations). The first meeting was held remotely on October 22, 2020. The process goes well beyond the normal notice-and-comment rulemaking procedure and offers members of the public and the regulated community an unusually broad set of options for submitting their views to the NJDEP. Under the new statute, a company seeking to obtain or renew certain NJDEP permits for new or expanded facilities that fall within the statute’s scope and are located in overburdened communities must prepare an “environmental justice impact statement” and provide for expanded public hearings on its project. In addition to applying the requirements of other applicable statutes and regulations, NJDEP must then determine if the proposed new or expanded facility will cause a disproportionate impact on the affected community. If NJDEP makes such a finding, it must deny the application if it seeks a new permit (unless the facility addresses a “compelling public interest” in the community) or impose extra conditions if the application seeks a permit renewal or...

NJDEP Solicits Input as It Begins Process of Drafting Regulations to Implement Landmark Environmental Justice Legislation

As we reported, New Jersey Governor Phil Murphy recently signed the nation’s first environmental justice law, which seeks to address the unfair distribution of the environmental and public health impacts of polluting activities by imposing additional requirements on parties seeking to site, expand, or renew permits for various types of facilities in “overburdened communities,” which are defined in the statute in terms of economic and demographic criteria. The statute requires the New Jersey Department of Environmental Protection (NJDEP) to promulgate regulations to implement its requirements. NJDEP began the public process of developing those regulations on October 22 when Olivia Glenn, Deputy Commissioner for Environmental Justice and Equity, and Sean Moriarty, Chief Advisor for Regulatory Affairs, hosted an online public information session in which they sought the public’s input on how the regulations should address numerous definitional and procedural issues. (The statute will not take effect until NJDEP promulgates its regulations.) Companies seeking to obtain or renew certain NJDEP permits for new or expanded facilities that fall within the statute’s scope and are located in overburdened communities must prepare an “environmental justice impact statement” and provide for expanded public hearings on their project. In addition to applying the requirements of other applicable statutes and regulations, NJDEP must then determine if the proposed new or expanded facility...

That Mine Is Yours, Not Theirs: Ninth Circuit Holds That WWII Shutdown Order Did Not Make Federal Government the CERCLA “Operator” of California Gold Mine

One perennially vexing issue for federal courts in cases brought under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as the Superfund law, is what makes someone an “operator” of a facility, and thus strictly (and, in most cases, jointly and severally) liable for cleanup costs. In particular, what degree and nature of control over a facility exercised by the government make it an operator? (We recently blogged on this issue.) In its recent decision in United States v. Sterling Centrecorp Inc., a divided panel of the Ninth Circuit held that a World War II-era federal order that shut down a gold mine in California did not give the government sufficient control over the operations of the mine to make it a CERCLA operator. Upon entering World War II, the United States faced a serious shortage of nonferrous metals, especially copper, and a corresponding shortage of the machinery and materials needed to produce them. Scarce resources needed to be redirected from nonessential operations to essential ones, and gold mines, such as the Lava Cap mine in Nevada County, California, were deemed nonessential. An order of the War Production Board required the mine to cease operations in 1943. While the order was revoked in 1945, operations at the mine never resumed. It was...

Pre-SRRA? SRRA!: NJDEP Clarifies Applicability of SRRA to Pre-SRRA Cleanup Orders and Agreements

In a listserv published on September 10, 2020, the New Jersey Department of Environmental Protection (NJDEP) has once again made clear that the innovative requirements of the 2009 Site Remediation Reform Act (SRRA), including the requirement to retain a licensed site remediation professional (LSRP), apply to any cleanup being performed under an administrative consent order (ACO) or remediation agreement (RA) that predates the enactment of SRRA on November 4, 2009. (SRRA was amended last year in what some commentators termed “SRRA 2.0.”) The NJDEP release, which supersedes a 2012 listserv on the same subject, confirms that (except for cleanups at certain federal facilities or sites being addressed under federal statutes) all parties conducting remediation work must retain an LSRP, even if they are subject to a pre-SRRA ACO or RA. NJDEP will hold in abeyance all ACO/RA requirements regarding departmental pre-approval of reports and work plans, as well as any deadlines contained in the order or agreement. Remediating parties must instead meet all regulatory and mandatory timeframes in NJDEP’s regulations. Other requirements in the ACO/RA will remain in effect, including those relating to a remediation funding source (RFS), RFS surcharges, and stipulated penalties. The new listserv also clarifies that SRRA overrides any termination provision in a pre-SRRA ACO or RA. NJDEP will not terminate an...

Who’s in Charge Here?: Third Circuit Holds That Government Was Not an “Operator” of Jersey City Chromium Facility for Purposes of Superfund Liability

Federal courts have long struggled to determine the shape and boundaries of the wide liability net cast by the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as the Superfund law. In its recent decision in PPG Industries Inc. v. United States, the Third Circuit applied circuit and Supreme Court precedent to hold that the government’s influence over a chromite ore processing plant in Jersey City during World War I and World War II was not pervasive or intrusive enough to make the government a past “operator” of the plant and thus liable for cleanup costs. Prior to PPG’s 1954 acquisition of the plant (which it continued to operate until 1963), Natural Products Refining Corporation (NPRC) operated the plant, which processed chromite ore into various chromium chemicals, including sodium bichromate. During both World War I and World War II (when it designated the plant’s output as critical war materials, i.e., products manufactured for direct military use), the government regulated the production of chromium chemicals. Through a variety of price, labor, and production controls, the government sought to encourage increased production of these key chemicals. Those efforts, however, did not extend to direct control over day-to-day operations or to the use of government employees to run the facility. Moreover, while the government was aware...

“Cooperative Federalism” or “Paternalistic Central Planning”?: U.S. Supreme Court Agrees That State Courts Can Hear Claims Over Adequacy of CERCLA Cleanups Under Certain Circumstances, But Limits Plaintiffs’ Options

The federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as the Superfund law, prescribes a careful process for making decisions on how to remediate contaminated sites. To avoid delay, the statute also divests federal courts of jurisdiction to hear most challenges to the selected remedy. In its recent opinion in Atlantic Richfield Co. v. Christian, the U.S. Supreme Court agreed that CERCLA does not bar state courts from hearing claims grounded in state law that go beyond claims for money damages and seek a cleanup that goes beyond what EPA requires. The case arose in Montana, where the Anaconda Copper Smelter operated for over a century and contaminated an area of over 300 square miles with arsenic and lead. Atlantic Richfield Company acquired the financially troubled smelter in the 1970s but could not reverse its decline, and closed it by 1980. Three years later, EPA named it one of its first official Superfund sites, and since then Atlantic Richfield has spent over $450 million on a cleanup that is expected to continue until 2025. The Superfund site that Atlantic Richfield has been remediating includes numerous residential properties. The owners of 98 of those properties sued Atlantic Richfield in Montana state court in 2008, asserting state common law claims. In addition to traditional...