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October 2012

Important Environmental Compliance Considerations In The Wake Of Hurricane Sandy

By Steven M. Siros and Allison A. Torrence

As Hurricane Sandy sweeps across the Eastern Seaboard, the images of its destructive power are humbling. As everyone begins to dig out from the damage caused by the storm, it is important to remember the environmental lessons learned from past storms and natural disasters. Inevitably, environmental issues will be a serious concern after Hurricane Sandy has run its course. As facilities move forward with the task of attempting to resume normal operations, there are a number of environmental issues that should be considered.

Releases of Hazardous Substances and Oil Spills

U.S. EPA requires releases of hazardous substances at or above specified "Superfund Reportable Quantities" ("RQs") to be reported to federal authorities. Releases of certain extremely hazardous substances above a RQ trigger reporting requirements to state and local authorities, as well as to the federal authorities. Additionally, some state and local governments require notification for any size release of hazardous substances. According to U.S. EPA, reporting is required even if the release occurred only as a result of a hurricane or other natural event.

After notification, cleanup of the hazardous substances will likely be required. Although an "Act of God" may be a defense to certain cleanup liability under CERCLA, U.S. EPA has taken an aggressive position in the past, arguing that past hurricanes did not trigger this defense.

Oil spills are also a significant concern when there is heavy rain and flooding. Facilities with Spill Prevention, Control and Countermeasure ("SPCC") Plans will need to ensure that secondary containment for aboveground storage tanks is maintained after the storm. Any oil spill that creates a visible sheen on navigable waters or adjoining shorelines must be reported to the federal government. There is no "Act of God" defense under the federal oil spill laws.

Here are some helpful links to U.S. EPA's websites that provide further guidance on hazardous substances and oil spill reporting:

http://www.epa.gov/oem/content/reporting/index.htm (Information On How To Report Releases of Hazardous Substances or Petroleum Products)

http://www.epa.gov/oem/content/epcra/serc_contacts.htm (List of State Emergency Response Contacts)

http://www.epa.gov/region4/r4_hurricanereleases.html (Information on Emergency Operating Procedures)

Wastewater Discharges

Wastewater treatment systems can overflow during and after significant rain events, such as a hurricane. These types of overflows can violate the operator's license and other regulatory requirements unless proper care is taken during and after the rain event. Operators must provide immediate notification (typically to the State regulators) of overflows caused by the severe rain event in order to preserve available defenses the operator may have for the overflow.

Stormwater Management

Many facilities are covered by a site-specific or regional stormwater management permit, requiring structural Best Management Practices ("BMPs") to prevent excess stormwater runoff. Failure of BMPs, such as silt fencing and retention basins, can cause violations and result in penalties. Following significant storms such as Hurricane Sandy, it is important that structural BMPs be inspected to ensure that they continue to function as intended.

Air Emissions

Most air permits provide exceptions for "malfunctions" that may be caused by storms or other uncontrollable events. Any excess emissions caused by such a malfunction should be carefully documented to support the malfunction defense. Additionally, many facilities have air permits that regulate the use of emergency generators, usually by providing limits on the total hours the emergency generators can be in operation. Therefore, care should be taken to record the total time any emergency or backup generators are used to ensure that any applicable regulatory limits are not exceeded.

Insurance Claims

Hurricane Sandy has left behind significant property damage and business interuptions, which may be covered under an owner's insurance policy. Insurance coverage will depend on the terms of each insurance policy, and the specific circumstances leading to the loss. When potential property damage or business interuption is identified, the owner should provide prompt notice to its insurer and document the loss to the extent possible.

For more information about potential environmental impacts from Hurricane Sandy, visit U.S. EPA's hurricane webpage: http://www.epa.gov/hurricanes/

For information concerning U.S EPA's response to the damage caused by Hurricane Katrina, visit U.S. EPA Region 4's webpage: http://www.epa.gov/region4/Katrina/


Perchlorate Panel Teleconferences Scheduled In December

Grayson_Lynn_COLORBy E. Lynn Grayson

 

The Science Advisory Board's (SAB) advisory panel on perchlorate has scheduled two teleconferences to discuss its draft report on EPA's white paper addressing recent epidemiological evidence on perchlorate. Perchlorate is both naturally occurring and commercially manufactured and is used in explosives, fireworks, rocket fuel and for other industrial purposes. Perchlorate often is a contaminant of concern at sites undergoing investigation and cleanup.

The teleconferences are scheduled for December 5th and December 7th from 2:00-5:00 ET each day. To listen to these teleconferences, contact Thomas Carpenter at 202-564-8885.

The draft SAB Perchlorate Advisory Report is available at http://tinyurl.com/9ylu7rm.


EPA Faces Suits Over State Haze Plans As It Awaits Decision On Petition For Rehearing On Cross-State Air Pollution Ruling

Torrence_Allison_COLORBy Allison A. Torrence

 

As discussed previously in this blog, the United States Court of Appeals for the District of Columbia Circuit ("D.C. Circuit") vacated the Cross-State Air Pollution Rule (the "Transport Rule") on August 21, 2012, in EME Homer City Generation, LP v. Environmental Protection Agency, et. al, Case No. 11-1302. The United States Environmental Protection Agency ("EPA") has petitioned for rehearing en banc in the D.C. Circuit. EPA claims in its petition that the case deals with issues of "exceptional importance" due to the enormous public health and regulatory significance of the Transport Rule. EPA argues that the three-judge panel that decided to vacate the Transport Rule acted inconsistent with D.C. Circuit precedent and in violation of the Clean Air Act. Notably, one of the three judges on the panel, Judge Rogers, dissented from the majority opinion. The D.C. Circuit has ordered the parties opposing the Transport Rule to respond to EPA's petition by October 29, 2012, after which it will decide whether to grant EPA's petition and hear the case in front of all eight judges in the D.C. Circuit.

Despite the ongoing litigation regarding the validity of the Transport Rule, environmental groups, including the Sierra Club, have recently filed a number of lawsuits challenging various States' haze reduction plans based on the fact that the haze reduction plans improperly rely on the Transport Rule. Under the Clean Air Act, States are required to develop State Implementation Plans ("SIPs") that address emissions that contribute to regional haze. As a part of their SIPs, States must require Best Available Retrofit Technology ("BART") for certain types of sources that emit pollutants that impair visibility. Earlier this year, EPA issued a final action allowing States participating in the Transport Rule emissions trading programs to use those programs in place of source-specific BART for sulfur dioxide and/or nitrogen oxide emissions from power plants that are subject to the regional haze rule. Sierra Club and other environmental organizations oppose the use of emissions trading programs to meet the haze rules, and have filed petitions for review in numerous Circuit Courts seeking a determination that EPA's policy is invalid because the D.C. Circuit found the Transport Rule to be legally defective.

The Sierra Club has acknowledged that its petitions in the various Circuit Courts are "protective Petition[s] for Review" because Sierra Club believes that the D.C. Circuit is the appropriate forum to decide the propriety of EPA's actions in these cases. Thus, Sierra Club has a petition for review pending in the D.C. Circuit, Utility Air Regulatory Group v. EPA, Case No. 12-1342. The D.C. Circuit case has been held in abeyance until that court issues a determination on EPA's petition for rehearing en banc.


EPA Releases 2012 Water Reuse Guidelines

By Kathryn C. Moore

In response to the increasing water supply challenges arising throughout many areas of the world, the Environmental Protection Agency (EPA) has released the 2012 Guidelines for Water Reuse. The document, developed by engineering firm CDM Smith Inc. under a Cooperative Research and Development Agreement (CRADA) with the EPA, is to be used by states in developing and implementing water reuse regulations in order to achieve resource efficiency and ensure protection of human and environmental health. To mitigate concerns over water management and expand the nation's total available water resources, many U.S. communities are increasingly relying on reclaimed water as an alternative source to conventional water for a multitude of reuse applications.

The guidelines update those released by the EPA in 2004 and reflect advances in water reuse practices and treatment technologies. The document summarizes existing U.S. regulations on water reuse and reclamation and describes water use practices outside of the United States. In addition, the guidelines include information on industrial reuse, disinfection and treatment technologies and planning future water reuse systems, as well as ideas for funding water reuse systems and generating public participation in water reuse.

Over 300 global case studies concerning water reclamation and reuse are included in the guidelines. The cases cover innovative water reuse practices by ski resorts in Pennsylvania, the reclamation of water by a Minnesota city for use as a cooling source for local power plants and PepsiCo's reuse and water reduction initiatives in beverage production.

Since publication of the guidelines, thirty states and one U.S. territory have adopted regulations and fifteen states have guidelines or design standards concerning water reuse, according to Don Vandertulip, leader of CDM Smith's water reuse discipline.

To access the EPA's 2012 Guidelines for Water Reuse, click here.

Kathryn C. Moore is a first year law student at Indiana University Maurer School of Law. She participated in a shadow day visit at Jenner & Block today. We appreciate her support in researching and preparing this blog.


State Pesticide Regulators Question Whether Use Of Biocides In Fracking Fluids Violates FIFRA

Siros_Steven_COLORBy Steven M. Siros

 

An association of state pesticide regulators recently raised an issue as to whether the use of certain biocides in hydraulic fracturing fluids are in violation of FIFRA. Biocides are commonly used in hydraulic fracturing fluids to control bacterial growth. According to recent comments by Jeff Comstock, the president-elect of the Association of American Pesticide Control Officials ("AAPCO"), association members have asked U.S. EPA's Antimicrobials Division whether the use of these biocides in fracturing fluids is regulated under FIFRA. According to Mr. Comstock, the use of biocides in fracturing fluids would appear to constitute a "pesticide use application" and drilling companies are mixing some industrial grade compounds into fracturing fluids to serve as biocides without those compounds being technically labeled for such use. Although fracturing fluids are generally exempted from some environmental laws, there are not any exemptions contained in FIFRA.  Certain biocides such as glutaraldehyde have already been approved under FIFRA for use as a biocide in fracturing wells.  According to the AAPCO, other materials listed as being used as biocides in fracturing fluids have not similarly been approved under FIFRA.  U.S. EPA has been invited to speak on this issue at a future AAPCO meeting.


Alaskan Village Seeks Rehearing of Climate Change Suit in 9th Circuit

Holleb_Hotaling_Keri_COLORBy Keri L. Holleb Hotaling

 

On October 4, 2012, the Alaskan Village of Kivalina filed a petition for rehearing en banc in the Ninth Circuit. Petitioners urge the Ninth Circuit to reconsider its September 21, 2012 decision to uphold dismissal of a federal common law public nuisance claim against twenty-two energy companies over their greenhouse gas emissions, which Kivalina claimed left the Village uninhabitable by eroding sea ice that protected the Village from fall and winter storms. Kivalina had sought damages of roughly $400 million. In its petition for rehearing, Kivalina argues that the recent Ninth Circuit decision directly conflicts with Exxon Shipping Co. v. Baker, 554 U.S. 471 (2008). Kivalina maintains that in Exxon Shipping, the Supreme Court held that the Clean Water Act, like the Clean Air Act at issue in this case, displaces federal common law claims for injunctive relief, but not for damages. The petition states "[t]he direct conflict here between the majority opinion and Exxon Shipping practically jumps off the page." Kivalina contends the Ninth Circuit's panel's decision was in error because Exxon Shipping "suggests a different result" from the one reached by the majority.

Section 113 Or 107? Supreme Court Declines To Clarify CERCLA Cost Recovery Options.

Torrence_Allison_COLORBy Allison A. Torrence

 

Ever since the U.S. Supreme Court decided United States v. Atlantic Research Corp. in 2007, CERCLA PRPs and courts have been struggling with a crucial question: Whether parties subject to a consent decree may file claims for cost recovery under §107(a) of CERCLA, or whether their remedies are limited to filing claims for contribution under §113(f) of CERCLA. On October 9, 2012, the Supreme Court declined the opportunity to clarify that question when it denied cert in the appeal of the 11th Circuit's opinion in Solutia Inc. v. McWane Inc., 672 F.3d 1230 (11th Cir. 2012).

In United States v. Atlantic Research Corp., 551 U.S. 128 (2007), the Supreme Court held that §107 of CERCLA provides PRPs with a cause of action to recover costs incurred in cleaning up contaminated sites from other PRPs. However, the Supreme Court explicitly left open the question of whether a PRP can recover costs under §107 if the PRP incurred those costs subject to a consent decree with the government. Id. at 139 n.6 ("we recognize that a PRP may sustain expenses pursuant to a consent decree following a suit under §106 or §107(a). In such a case, the PRP does not incur costs voluntarily but does not reimburse the costs of another party. We do not decide whether these compelled costs of response are recoverable under §113(f), §107(a), or both.").

In the Solutia case, the 11th Circuit ruled that a PRP who has incurred cleanup costs pursuant to a consent decree cannot obtain cost recovery under §107, and is instead left with only a contribution claim under §113. 672 F.3d at 1237. As the 11th Circuit explained in its opinion, the majority of courts that have addressed this issue have held that §113 provides the exclusive remedy for a PRP compelled to incur response costs pursuant to a consent decree. See Morrison Enter., LLC v. Dravo Corp., 638 F.3d 594, 603 (8th Cir. 2011); Agere Sys., Inc. v. Advanced Envtl. Tech. Corp., 602 F.3d 204, 229 (3d Cir. 2010); Niagara Mohawk Power Corp. v. Chevron U.S.A., Inc., 596 F.3d 112, 128 (2d Cir. 2010).

Uncertainty remains, however, due to inconsistent rulings on this issue, primarily in federal district courts. For example, district courts in Illinois, New York, and Michigan have allowed §107 claims to proceed despite the presence of a consent decree compelling cleanup. See, e.g., United States v. Pharmacia Corp., 713 F.Supp.2d 785, 791 (S.D. Ill. 2010); New York v. Solvent Chem. Co., 685 F.Supp.2d 357, 425-28 (E.D.N.Y. 2010); Ford Motor Co. v. Michigan Consol. Gas. Co., No. 08-CV-13503, 2009 WL 3190418, at *6-8 (E.D. Mich. Sept. 29, 2009).

PRPs who have entered into a consent decree and then seek recovery of their cleanup costs are still left with the decision of what type of CERCLA claim to pursue. Without clarification of these issues from the Supreme Court, PRPs will likely continue to pursue claims under both §107 and §113, leaving it to each individual court to decide the validity of the CERCLA claims.


EPA Releases NEPmap For National Estuary Program Projects

Grayson_Lynn_COLORBy E. Lynn Grayson

 

EPA has released the first interactive map, NEPmap, detailing information about 29 National Estuary Program projects throughout the United States. NEPmap provides a summary of details about each project including program description, size, habitat(s) at issue, restoration activities and lead agency identification.

The NEPmap allows users to view water quality data for any estuary as well as surrounding watersheds. NEPmap is flexible and users can create and print maps and reports in a variety of different formats.

Key information applicable to NEPmap is for FY2010 and FY2011 but other information is available dating back to 2000. The map is available at http://gispub2.epa.gov/NEPMap/index.html.

The National Estuary Program is a network of voluntary community-based programs that safeguards the health of important coastal ecosystems throughout the United States.


Navy Shipbuilders Avoid Asbestos Product Liability Claims

Siros_Steven_COLORBy Steven M. Siros

 

On October 3, 2012, the United States District Court for the Eastern District of Pennsylvania decided two questions of first impression under maritime law: (1) does maritime law recognize the sophisticated user and/or sophisticated purchaser defenses and (2) is a Navy ship a "product" for purposes of strict product liability law? The plaintiff was a welder who claimed that he was exposed to asbestos aboard various Navy ships during the 1960s and 1970s. He brought both negligence and strict product liability claims alleging that the defendants (Navy shipbuilders) had failed to warn him of the hazards of asbestos in the Navy ships.

The court first evaluated the application of the sophisticated user/purchaser defenses. After considering the policy objectives of maritime law, the court found the sophisticated purchaser defense to be unavailable for asbestos claims under maritime law. The court was concerned that application of the sophisticated purchaser defense would have the effect of leaving all Navy personnel without a remedy since Navy personnel are already precluded from recovering from the United States government for their asbestos-related injuries. With respect to the sophisticated user defense, however, the court noted that recognition of this defense under maritime law would serve to "encourage participation in maritime commerce by limiting—in a reasoned manner—potential liability of those involved in such commerce while continuing to protect those sea workers in need of protection (i.e., those workers who are not sophisticated as to the hazards to which their work exposes them)." The court therefore found the sophisticated user defense to be applicable to negligence claims under maritime law.

Relying on the Restatement (Second) of Torts, the court limited the applicability of the sophisticated user defense to negligence claims and found that the defense was not a bar to plaintiff's strict liability claims. The court therefore proceeded to evaluate whether the Navy ship is a "product" for purposes of strict product liability under maritime law. The court found that as between a shipbuilder and the manufacturer of the various products within the ship, the entities best able to protect sea-bound workers and to bear the burden of preventing harm to these workers are the manufacturers of the various products aboard the ship. The court was concerned that to place upon a Navy shipbuilder potential liability for the tens of thousands of products assembled in a Navy ship pursuant to Navy specifications would "be an undue, unmanageable, and cumulative burden likely to discourage the activity of shipbuilding." The court therefore found that the Navy ship was not a "product" within the meaning of maritime strict product liability law.

To view a copy of the court's order in Mack v. General Electric Company et al., please click here.


New Litigation Filed Over Spent Lead Ammunition On Public Lands

Grayson_Lynn_COLORBy E. Lynn Grayson

 

The Center for Biological Diversity, the Sierra Club and the Grand Canyon Wildlands Council have filed a complaint against the U.S. Forest Service to limit the disposal of spent lead ammunition. Filed before the U.S. District Court for the District of Arizona, the plaintiffs seek to protect wildlife species threatened by exposure to spent lead ammunition in their foraging range on federal land in Arizona, including the Kaibab National Forest.

The complaint alleges that the California condor and other species are particularly susceptible to lead poisoning caused by the ingestion of spent ammunition. The complaint also charges that the U.S. Forest Service has the authority to prohibit or otherwise regulate the use of lead ammunition but has elected not to do so.

According to the plaintiffs, the spent lead ammunition disposed of on public lands presents an imminent and substantial endangerment to health or the environment and the threat is ongoing. Under the Resource Conservation and Recovery Act, the complaint seeks declaratory or injunctive relief to stop continued endangerment to wildlife species occurring within the Kaibab National Forest. The U.S. Forest Service has 60 days to file an answer or otherwise respond to the complaint.

More information about the lawsuit and potential lead contamination concerns on public lands is available at http://www.biologicaldiversity.org/.