Gravel2Gavel Construction & Real Estate Law Blog

In an insurance case attracting the attention of many insurance companies, Century Indemnity Company v. Marine Group, LLP, et al., a U.S. Magistrate Judge with the U.S. District Court for the District of Oregon (Portland Division), in its opinion and order on Marine Group’s motion for clarification and reconsideration, held that an insurance policy provision which excludes coverage for environmental claims brought by governmental agencies extends to Superfund or CERCLA natural resource damage claims asserted by Indian tribes that are members of a Superfund Trustee Council. The Indian tribes are members of the Portland Harbor Natural Resource Trustee Council, and the Court held that the claims asserted by members of the Council, including the tribes, triggered the insurance exclusion.

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Citizens Suits have played an important role in the enforcement of both the Clean Water Act (CWA) and the Clean Air Act (CAA), and all permittees of wastewater discharge permits and air quality permits should be aware of the significance of these Congressionally-approved remedies. While they have broad application to many routine industrial discharges, there also are limited conditions placed on their use. For instance, the CWA Citizen Suit provision, 33 U.S.C. § 1365, requires plaintiffs to provide the alleged violator 60 days’ notice before filing a lawsuit. In addition, the text of the provision of the CWA limits its application to violations of “effluent standards or limitations,” which the CWA also carefully defines by reference to Sections 1311, 1312, 1316. 1317, 1341, and 1342 of the CWA. If the subject matter of the alleged violation is not covered by these provisions, the case will usually be dismissed.

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The U.S. Court of Appeals for the Third Circuit, in Group Against Smog and Pollution v. Shenango, Incorporated, affirmed the dismissal of a Clean Air Act (CAA) Citizen Suit where state regulators were engaging in an ongoing action against Shenango when GASP’s complaint was filed, and where the federal court had retained jurisdiction over a Consent Decree that had been issued. Continue Reading ›

In United States v. Tonawanda Coke Corp., the U.S. Court of Appeals for the Second Circuit, in an unpublished opinion released on January 11, 2016, rejected Tonawanda’s appeal of the lower court’s judgment adjudicating it guilty of criminal offenses under the Clean Air Act (CAA) and Resource Conservation and Recovery Act (RCRA), and requiring Tonawanda to fund two studies, at a cost of $12.2 million to investigate the effects of its conduct. On appeal, the Court of Appeals considered Tonawanda’s two arguments. First, Tonawanda argued that its RCRA conviction should be set aside because it did not have fair notice that its conduct was illegal and, second, that the prosecution should be barred because the relevant five-year statute of limitations had expired. The Court of Appeals dismissed the first argument, holding that Tonawanda’s counsel had not preserved this issue at trial. Regarding the second issue, the crime for which Tonawanda was convicted was the illegal storage of hazardous waste. The Court of Appeals found it was a “continuing offense” for which the “limitations clock” did not begin until December 2009, when, presumably, the illegal storage ceased. As stated by the Court of Appeals, “Congress, in enacting RCRA, employed language indicating that it understood [illegal] storage to be a continuing offense.”

On December 29, 2105, the Pennsylvania Supreme Court issued a ruling that may be of considerable interest to oil and gas operators in Pennsylvania. In EQT Production Company v. Department of Environmental Protection of the Commonwealth of Pennsylvania, the Court considered the “whether a company threatened by an administrative agency with ongoing, multi-million-dollar penalties per such agency’s interpretation of a statutory regime has the right, immediately, to seek a judicial declaration that the agency’s interpretation is erroneous.” Answering the question in the affirmative, the Court held that “the impact of the Department’s threat of multi-million dollar assessments against EPC was sufficiently direct, immediate, and substantial to create a case or controversy justifying pre-enforcement judicial review via a declaratory judgment proceeding, and that exhaustion of administrative remedies relative to the issues of statutory interpretation that the company has presented was unnecessary.”  The Court also confirmed that very large civil penalty assessments may be subject to pre-enforcement judicial review in Pennsylvania state courts and that the Pennsylvania Environmental Hearing Board (PEHB) may not have exclusive jurisdiction to review these proposed penalties.

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