Gibbons Law Alert Blog

New Jersey Governor Signs Environmental Justice Legislation

On September 18, 2020, New Jersey Governor Phil Murphy signed legislation intended to address the disproportionate environmental and public health impacts of pollution on overburdened communities. The legislation, versions of which have been proposed several times over the past decade, imposes additional requirements on companies seeking permits for new or expanded facilities under a variety of environmental statutes. It also requires the New Jersey Department of Environmental Protection (NJDEP) to evaluate how the proposed permitted activities would impact those communities determined to be “overburdened” under the new law. Earlier this summer, marking the “Juneteenth” anniversary of the emancipation of slaves in the United States, Governor Murphy had indicated his support for the legislation, which some environmental advocates have dubbed the “holy grail” of the environmental justice movement. Although critics of the law raised concerns about its effect on manufacturing and business investment in New Jersey, the bill passed the state legislature in late August, with votes of 49-28-1 in the state Assembly and 21-14 in the state Senate. The types of facilities covered by the new law include certain power plants, incinerators, sewage treatment plants, solid waste facilities, and landfills, as well as other facilities deemed to be “major sources of air pollution” (as determined by the federal Clean Air Act). Governor Murphy stated that,...

Susanne Peticolas Elected to Serve as President of the Justice Stewart G. Pollock Environmental American Inn of Court

Susanne Peticolas, a Director in the Environmental Department at Gibbons P.C., has been elected to serve as President of the Justice Stewart G. Pollock Environmental American Inn of Court (“Pollock Inn”) for the 2020-2022 term. The Pollock Inn is named for former Justice Stewart G. Pollock, who sat as an Associate Justice on the Supreme Court of New Jersey from 1979 to 1999 and was the author of numerous landmark environmental cases, including NJDEP v. Ventron. The Pollock Inn is one of only two American Inns of Court focused on environmental law. Previous Pollock Inn presidents include retired Judge Deanne Wilson of the New Jersey Superior Court, former NJDEP Commissioner Jerry English, and Stephanie Brand, Director of the New Jersey Division of Rate Counsel. On being introduced as the new Pollock Inn president, Ms. Peticolas commented, “I am honored to be selected by my Inn colleagues to lead this wonderful organization, and I am humbled to follow in the footsteps of such extraordinarily talented predecessor presidents. I am committed to carrying on their legacy of leadership and promotion of the goal of the Inn – to foster the highest levels of professionalism through example, education, and mentoring.” The American Inns of Court organization grew out of discussions in the 1970s among the American members of...

District Court Rejects the Concept of Unilateral “Relevance Redactions” but Stresses the Importance of Discovery Confidentiality Orders to Address Commercially-Sensitive Information

In a recent decision, a Washington District Court illustrated the challenges parties face when they are in possession of responsive documents also containing highly confidential irrelevant information. The court stressed that, as a general rule, a party is not permitted to unilaterally redact information solely on the basis of relevance, and parties should consider seeking to enter into comprehensive ESI discovery protocols and discovery confidentiality orders allowing for the redaction of irrelevant information included in otherwise responsive documents, particularly where the parties will be exchanging highly confidential information in discovery. In Corker v. Costco Wholesale, plaintiffs initiated a class action suit against a number of coffee wholesalers, distributors and retailers under the Latham Act for false designation of origin. In discovery, plaintiffs sought the sale volume and pricing for the particular blend of coffee at issue sold by the defendants. Instead of producing the spreadsheet containing this information in the native excel format, one defendant first produced documents summarizing the contents of the spreadsheet and then, after plaintiffs objected to this disclosure, a 2,269-page static PDF of the spreadsheet redacting information related to coffee blends not at issue in the litigation that the defendant considered highly confidential. Plaintiffs moved to compel the production of the spreadsheet in the native form as kept in the ordinary...

USDOJ Legal Memo Clarifies Department’s Policy on Using Federal Judgment Fund to Settle Superfund Cases

A U.S. Department of Justice legal memo, obtained under the Freedom of Information Act by Bloomberg Law, has clarified and restated the Department’s strict policy against using the federal Judgment Fund to settle Superfund cases in which the federal government is a Potentially Responsible Party (PRP). The memo states that the federal government can settle its liability by payments from the Fund only if the settlement is “final” – that is, there are no contingencies or future payments due. Many Superfund settlements do not meet that standard, since they typically include reopeners, “pay-as-you-go” arrangements, or provisions for additional funding if the remedy proves more expensive than originally estimated. As Gibbons Director David J. Freeman told Bloomberg Law, “It’s not a favorable development for the program, or for making progress on settlements in general, for the government to be taking such a hard line on this.” This policy will likely result in making it more difficult to achieve settlements at sites where the federal government is a PRP.

Second Circuit Holds Injunctive Class of Past Purchasers Not Certifiable Under Rule 23(b)(2)

The Second Circuit recently resolved a conflict among district courts, holding that past purchasers of a product are ineligible for class certification under Rule 23(b)(2) because not all class members would benefit from injunctive relief. Specifically, explained the Court, it is unlikely a purchaser will buy the allegedly deceptive product again, and if they do, they do so with the knowledge of the alleged deception. In Berni v. Barilla S.p.A., plaintiffs initiated a class action alleging that defendant intentionally sold its pasta in misleading boxes that concealed non-functional “slack-fill,” i.e., excessive empty space in the box. The parties reached a settlement, agreeing that defendant would include a minimum “fill-line” on its boxes, to indicate how much pasta was in the container, and a disclaimer that the pasta is sold by weight and not by volume. Neither party challenged the settlement; however, an absent class member objected, arguing that the group of past purchasers could not be certified under Rule 23(b)(2) because past purchasers were ineligible for injunctive relief. The district court disagreed and certified the injunctive class and approved the settlement. The objector appealed. The Circuit Court vacated the district court’s order granting approval of the settlement class, reasoning that injunctive relief was not proper for the group of past purchasers and, thus, the group...

Third Circuit Reverses Denial of Class Certification: Holds Ascertainability Satisfied Even with Gaps in Records

On September 9, 2020, a split panel of the Third Circuit issued a precedential opinion in Hargrove v. Sleepy’s LLC, reversing the denial of class certification because the district court “misapplied” the Circuit’s ascertainability case law and was “too exacting” when it “essentially demanded” that plaintiffs identify the class members at the certification stage. The circuit court also determined that the district court erroneously applied the motion-for-reconsideration standard to plaintiffs’ renewed motion for class certification, and held that courts should apply “the usual Rule 23 standard.” In Hargrove, the plaintiffs, delivery drivers, brought an employee misclassification suit alleging that defendant misclassified them as independent contractors, rather than employees, and thus violated several New Jersey labor laws. The district court denied class certification, twice, on the ground that the ascertainability requirement was not satisfied. In denying plaintiffs’ renewed motion for certification, the Court held that plaintiffs’ proposed class was “not ascertainable because the records kept by Sleepy’s regarding the identity of the drivers lacked critical information.” The plaintiffs sought leave to appeal pursuant to Rule 23(f), and the Third Circuit granted their request. First, the circuit court addressed the split among the district courts, both in and out of the Third Circuit, on the issue of the standard that applies to renewed motions for class certification....

Rule 37(e) and a Court’s Inherent Authority to Sanction Parties for Spoliation of ESI; The District of Arizona Reminds Litigants that When Rule 37(e) is Up to the Task, It is the Controlling Source of Sanctions

The United States District Court for the District of Arizona recently addressed the issue of whether the court’s inherent authority can be used to analyze the failure to preserve ESI after amended Rule 37(e) became effective on December 6, 2015. Following the well-publicized amendments to Rule 37(e), the question of whether the court’s “inherent authority” to sanction a party for the spoliation of ESI survived the amendments has received disparate treatment from courts despite what many opine to be unambiguous language in the amended rule. In Alsadi v. Intel Corporation, District Judge David Campbell, who chaired the Advisory Committee on the Federal Rules of Civil Procedure from 2011 to 2015, weighed in on this controversy, in pronouncing that a court cannot impose negative (adverse) inference sanctions pursuant to inherent authority when Rule 37(e) is up to the task of addressing ESI spoliation and the intent requirement of that rule is not satisfied. In this case involving claims for negligence and loss of consortium related to the emission of hazardous gases from an industrial wastewater system, plaintiffs (a plant employee and his wife) alleged that defendant’s negligence caused the plant employee to become permanently disabled after being exposed to hydrogen sulfide and possibly other toxic gases. Plaintiffs sought data from defendant regarding measurements of ambient gas...

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...

Permits to Be Extended Under Permit Extension Act of 2020 Must Be Registered by October 8, 2020

We previously reported on the adoption of the Permit Extension Act of 2020, which provided a mechanism for tolling or extension of permits and approvals during the public health emergency associated with COVID-19, and extending those approvals for “at least six months beyond the conclusion” of the associated extension period. Under the Permit Extension Act of 2020, all approvals that are subject to tolling or extension were required to be registered “with the department” within 30 days of the publication of a notice in the New Jersey Register. That registration deadline has now been established as October 8, 2020. Regardless of whether your permit or approval expires in the next few months or late next year, it may be prudent to register now, particularly given the differences between the prior iterations of the Permit Extension Act and the present statutory language, and the lack of a clear end of the present public health emergency. The Department of Environmental Protection published a notice in the New Jersey Register on September 8, 2020, announcing that the registration period for approvals has begun. Notably, the notice provides that “[t]his registration requirement applies to specified permits, approvals, and deadlines from a broad range of State and local entities – not just the Department.” It is not clear under the...

(State) Settlors Beware, Too: In Reversal, Third Circuit Declares that State Settlement Does Not Protect Against Federal Claims under CERCLA

Previously, the District of New Jersey ruled that a polluting party’s settlement agreement with the New Jersey Department of Environmental Protection (NJDEP) provided contribution protection from the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) claims based on costs incurred by the United States Environmental Protection Agency (USEPA) at the same site, even though USEPA was not a party to the settlement. In a prior blog post discussing that decision, we noted that the District Court’s decision was likely to be appealed. It was. On appeal, the Third Circuit considered the inquiry of “[w]hether a polluting party’s settlement with the State of New Jersey protects it from lawsuits seeking contributions toward expenditures made by the Federal Government on the same site,” and determined in a precedential opinion that, “the answer here is no.” CERCLA section 113(f)(2) provides that “[a] person who has resolved its liability to the United States or a State in an administrative or judicially approved settlement shall not be liable for claims for contribution regarding matters addressed in the settlement.” The District Court applied the analysis commonly adopted by other federal courts to determine the “matters addressed” of the previous settlement where the scope is not made explicit by the agreement itself. This analysis includes factors such as the location, time frame,...