Clean Harbors Services Inc v. Illinois International Port District
Filing
117
MEMORANDUM Opinion and Order: For the foregoing reasons, Defendant's motion to dismiss the Third Amended Complaint, R. 111 , is (1) granted as to pier allegations in Counts II and III and (2)denied in all other respects. Signed by the Honorable Thomas M. Durkin on 2/15/2018:Mailed notice(srn, )
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
CLEAN HARBORS SERVICES, INC,
Plaintiff,
v.
THE ILLINOIS INTERNATIONAL,
PORT DISTRICT,
Defendant.
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No. 12-CV-7837
Judge Thomas M. Durkin
MEMORANDUM OPINION AND ORDER
Plaintiff Clean Harbors Services, Inc. (“Clean Harbors”) brought this action
against Defendant The Illinois International Port District (“Port District”) asserting
claims under the Comprehensive Environmental Response, Compensation, and
Liability Act (“CERCLA”), 42 U.S.C. §§ 9607, 9613, the Resource Conservation and
Recovery Act (“RCRA”), 42 U.S.C. § 6972, and state law. Presently before the Court
is the Port District’s Motion to Dismiss Counts II, III, and VIII of Clean Harbors’
Third Amended Complaint. For the reasons explained below, the Port District’s
motion is granted in part and denied in part.
BACKGROUND 1
This case involves contaminated property located at 11700 and 11800 South
Stony Island in Chicago, Illinois (the “property”). R. 108 ¶ 1. The Port District has
Additional background of this case is set forth in the Court’s February 25, 2013
order, R. 27. In that order, the Court granted the Port District’s motion to dismiss
Clean Harbors’ Resource Conservation and Recovery Act (“RCRA”) claims and also
dismissed the Port District’s RCRA counterclaim because neither party had
provided the proper pre-suit notice required by the RCRA. Id. (Clean Harbors
Servs., Inc. v. Illinois Int’l Port Dist., 2013 WL 678271 (N.D. Ill. Feb. 25, 2013).
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owned the property since 1955. In the 1960s and 1970s, the Port District began to
construct piers on the property with fill materials consisting of industrial waste,
construction debris, natural material, and a mixture of soil, steel industry wastes,
and pea-sized gravel. Id. ¶¶ 27, 30, 31. Also in the 1970s, the Port District leased
the property to a now-dissolved company, Hyon Waste Management Services, Inc.
Id. ¶ 36. Hyon Waste operated a series of surface impoundments at the property for
the treatment, storage, and disposal of hazardous wastes and disposed of tens of
millions of gallons of waste. Clean Harbors alleges that the Port District, as the
owner of the property, knew or reasonably should have known of Hyon Waste’s
contamination but did nothing to abate the contamination or hold Hyon Waste
accountable for the contamination. Id. ¶ 51.
Beginning in the 1980s, the Port District leased the property to two different
companies, ChemClear, Inc. and CMW Chemical Services, Inc., both of which Clean
Harbors later acquired. (Throughout this Order, the Court refers to Clean Harbors
and these companies collectively as “Clean Harbors.”) Clean Harbors operated a
waste processing facility at the property that processed hazardous wastes for
disposal or recycling at offsite locations. Clean Harbors and the Port District are copermittees on permits issued by the Illinois Environmental Protection Agency
(“IEPA”). One such permit is a RCRA Part B permit, which was originally issued on
November 4, 2005 and expired on December 9, 2015 (the “Permit”). The IEPA
renewed the Permit effective September 6, 2017. R. 108 ¶ 197.
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The IEPA eventually directed the Port District and Clean Harbors to conduct
a RCRA facility investigation of the property. The parties performed the
investigation and discovered contamination primarily related to Hyon Waste’s
operations in the 1970s. R. 108 ¶¶ 89–99. Clean Harbors incurred substantial costs
to conduct the investigation. Id. ¶ 150. The Port District and Clean Harbors
subsequently worked with the IEPA to develop a corrective action plan to address
the contamination (known as the “Cap and Drain Plan”). IEPA gave its final
approval for the plan in 2011. Id. ¶ 123. The IEPA’s plan required that an existing
cover at the property remain in place as an engineered barrier, required the
construction of a french drain, and required future groundwater monitoring at the
property. The Plan is projected to cost $5.75 million in construction costs and an
additional $ 2.15 million in monitoring costs. Id. ¶ 151.
In 2012, Clean Harbors provided notice of its intent to terminate its leases on
the property and identified issues related to the Cap and Drain Plan that needed to
be resolved as part of its winding down of operations at the property. R. 108 ¶¶ 130–
131. Two weeks after Clean Harbors gave notice of its intent to terminate the
leases, the Port District wrote to the IEPA stating it had not approved the Cap and
Drain Plan. Id. ¶ 135. Later in 2012, the Port District demanded that Clean
Harbors remove the engineered barrier discussed in the Plan, demanded it
construct a truck yard on the property, and refused to grant it access to the property
to remove certain improvements. Id. ¶ 140-42. The Port District also refused to
complete forms required to wind down Clean Harbors’ operations properly with the
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IEPA. Id. ¶ 146. Finally, Clean Harbors alleges the Port District overcharged it
quarterly rent payments from 2010 through 2012 totaling $315,000. Id. ¶ 78.
On February 19, 2013, Clean Harbors provided written notice to the Port
District, the IEPA, and the U.S. Environmental Protection Agency (“EPA”) of its
intent to file a RCRA citizen suit against the Port District pursuant to 42 U.S.C. §
6972. The notice letter accused the Port District of violating the parties’ IEPA
permit by refusing to implement the Cap and Drain Plan, refusing to take financial
responsibility for its share of the clean-up under the Plan, refusing to execute
documents to allow for the closure of RCRA units (through Clean Harbors) at the
property, and by demanding that the engineered barrier be removed in violation of
the Cap and Drain Plan. R. 108-5 at 20-21. The notice letter also accused the Port
District of violating the RCRA’s endangerment provision (42 U.S.C. § 6972(a)(1)(B))
as the owner of the contaminated property. Id. at 21–22.
In December 2013, the Court stayed the case to allow the IEPA to approve
Phase II of the Cap and Drain Plan. R. 65. In January 2017, the Court resumed
proceedings. R. 98. Clean Harbors subsequently filed its Third Amended Complaint
(“TAC”) on October 10, 2017. R. 108. At issue in this dispute are Counts II, III, and
VIII. In Count II of the TAC, Clean Harbors asserts a cause of action under the
endangerment citizen suit provision of the RCRA, 42 U.S.C. § 6972(a)(1)(B). In
Count III, Clean Harbors brings a citizen suit claim to abate RCRA permit
violations under 42 U.S.C. § 6972(a)(1)(A). Both counts allege Clean Harbors
provided pre-suit notice to the Port District on February 19, 2013. R. 108 ¶¶ 186,
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215. In Count VIII, Clean Harbors alleges the Port District was unjustly enriched
after it refused to return rent overpayments Clean Harbors made. Id. ¶¶ 237–244.
On October 31, 2017, the Port District filed a motion to dismiss Counts II, III,
and VIII of the TAC under Fed. R. Civ. P. 12(b)(1) and 12(b)(6). As to the RCRA
claims, the Port District argues Clean Harbors (1) failed to allege any facts showing
it has an “injury in fact” to demonstrate standing under Article III of the
Constitution; (2) failed to provide adequate pre-suit notice; and (3) failed to
sufficiently allege RCRA violations under each provision. The Port District argues
that Count VIII should be dismissed because Clean Harbors improperly bases its
unjust enrichment claim on an express written contract.
LEGAL STANDARD
A Rule 12(b)(6) motion challenges the sufficiency of the complaint. See
Hallinan v. Fraternal Order of Police of Chicago Lodge No. 7, 570 F.3d 811, 820 (7th
Cir. 2009). Under Rule 8(a)(2), a complaint must include “a short and plain
statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P.
8(a)(2). Under the federal notice pleading standards, a plaintiff’s “factual allegations
must be enough to raise a right to relief above the speculative level.” Bell Atlantic v.
Twombly, 550 U.S. 544, 555 (2007). Put differently, a “complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible
on its face.’” Ashcroft v. Iqbal, 556 U.S. 662 (2009) (quoting Twombly, 550 U.S. at
570). “In evaluating the sufficiency of the complaint, [courts] view it in the light
most favorable to the plaintiff, taking as true all well-pleaded factual allegations
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and making all possible inferences from the allegations in the plaintiff’s favor.”
AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir. 2011).
Rule 12(b)(1) authorizes the Court to dismiss any claim for which the Court
lacks subject matter jurisdiction according to Article III, Section 2 of the U.S.
Constitution. When a defendant challenges jurisdiction, the plaintiff bears the
burden of establishing a court’s jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S.
555, 561 (1992). As with 12(b)(6) motions, in deciding a Rule 12(b)(1) motion the
Court must “accept as true all well-pleaded factual allegations and draw all
reasonable inferences in favor of the plaintiff.” St. John’s United Church of Christ v.
City of Chi., 502 F.3d 616, 625 (7th Cir. 2007) (quotation marks omitted).
DISCUSSION
I.
RCRA (Counts II and III)
The RCRA was enacted to aid in a national policy to reduce or eliminate
hazardous waste “as expeditiously as possible.” 42 U.S.C. § 6902(b). Waste that
cannot be eliminated “should be treated, stored, or disposed of so as to minimize the
present and future threat to human health and the environment.” Id. To help
enforce this goal, Congress enacted a citizen-suit provision that allows “any person”
to commence a civil action against alleged violators of the RCRA. 42 U.S.C. § 6972.
RCRA authorizes two general types of citizen suits. First, a plaintiff may
commence a civil action against “any person . . . who is alleged to be in violation of
any permit, standard, regulation, condition, requirement, prohibition, or order
which has become effective pursuant to this chapter.” 42 U.S.C. § 6972(a)(1)(A). To
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proceed under subsection (a)(1)(A), a plaintiff is generally required to provide 60
days advance notice to the EPA Administrator, the State in which the violation
occurred, and the alleged violator. Id. § 6972(b)(1)(A) (“No action may be
commenced under subsection (a)(1)(A) . . . prior to 60 days after the plaintiff has
given notice of the violation to (i) the [EPA] Administrator; (ii) the State in which
the alleged violation occurs; [and] (iii) to any alleged violator of such permit,
standard, regulation, condition, requirement, prohibition, or order.”). Second, a
plaintiff may commence a civil action against “any person . . . who has contributed
or who is contributing to the past or present handling, storage, treatment,
transportation, or disposal of any solid or hazardous waste which may present an
imminent and substantial endangerment to health or the environment.” Id. §
6972(a)(1)(B). To proceed under subsection (a)(1)(B), a plaintiff is generally required
to provide 90 days advance notice. Id. § 6972(b)(2)(A) (“No action may be
commenced under subsection (a)(1)(B) . . . prior to ninety days after the plaintiff has
given notice of the endangerment to (i) the [EPA] Administrator; (ii) the State in
which the alleged endangerment may occur; [and] (iii) any person alleged to have
contributed or to be contributing to the past or present handling, storage,
treatment, transportation, or disposal of any solid or hazardous waste.”). There are
exceptions to these notice provisions, but they are not relevant here.
In Counts II and III, Clean Harbors brings both types of citizen suits. Count
II, (the “Endangerment Claim”), is a claim under § 6972(a)(1)(B). Clean Harbors
alleges that the Port District was at all relevant times the owner of the property
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and (1) actively contributed to the contamination through the construction of the
piers on the property; (2) knew and approved of hazardous waste handling,
treatment, storage, and disposal activities at the property by Hyon Waste; and (3)
presents an imminent and substantial endangerment to health and the
environment through its demands that the engineered barrier be removed from the
property. R. 108 ¶¶ 170, 171, 185. Clean Harbors alleges it issued a written notice
and demand to the Port District, the EPA Administrator, and the IEPA as required
by 42 U.S.C. § 6972(b)(2)(A) on February 19, 2013. Id. ¶ 186; see also R. 108-5 at 2324.
In Count III, Clean Harbors brings a claim under § 6972(a)(1)(A) (the “Permit
Claim”). Clean Harbors alleges the Port District violated the Permit by demanding
that Clean Harbors remove engineered barriers approved as part of the Cap and
Drain Plan; by refusing to implement and pay its fair share of the costs of the Cap
and Drain Plan; and by obstructing Clean Harbors from accessing the Property to
monitor ground water conditions in compliance with the Permit. R. 108 ¶¶ 197–201.
Clean Harbors alleges these actions violate (i) Section 4 of Attachment I and Section
V(C)(1) of the Permit; (ii) 35 Ill. Admin. Code §§ 724.201(a), 702.141 and
703.121(a)(2); and (iii) 40 C.F.R. §§ 264.101(a) and 270.30(a). Id. ¶ 202. Clean
Harbors further alleges the Port District violated its permit obligations and 35 Ill.
Admin. Code § 724.212(b)(4) by refusing to execute a modification form, and by
disposing of hazardous waste through the construction of the piers without a permit
in violation of 42 U.S.C. §§ 6924 and 6925, and 40 C.F.R. § 270.1(c). Id. ¶¶ 207, 213.
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Clean Harbors alleges it provided a written notice and demand as required by 42
U.S.C. § 6972(b)(1)(A) on February 19, 2013. Id. ¶ 215.
A. Article III Standing
To establish standing under Article III of the Constitution, Clean Harbors
must plead: (1) a “concrete and particularized” injury in fact that may be either
“actual or imminent;” (2) a causal connection between the injury and the conduct
complained of; and (3) a likelihood that a favorable decision will result in a remedy
for the plaintiff. Lujan, 504 U.S. at 560–61. The relevant showing for purposes of
Article III standing is not injury to the environment but injury to the plaintiff.
Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 181
(2000).
Further, “injury in fact” is loosely defined by courts as requiring a “personal
stake in the outcome” of the litigation, (see Sierra Club v. Morton, 405 U.S. 727,
731–32 (1972)), or the “invasion of a legally protected interest” (Lujan, 504 U.S. at
560). “The injury in fact requirement precludes those with merely generalized
grievances from bringing suit to vindicate an interest common to the entire public.”
Friends of the Earth, Inc. v. Gaston Copper Recycling Corp., 204 F.3d 149, 156 (4th
Cir. 2000) (citing Lujan, 504 U.S. at 575.) A plaintiff must differentiate himself from
the mass of people who may find the conduct of which he complains to be
objectionable only in an abstract sense. Id. The alleged injury “must affect the
plaintiff in a personal and individual way.” Id.
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The Port District appears to confuse Article III standing with standing under
a statute. It argues Clean Harbors has failed to allege that “it has any concerns—
health, environmental, aesthetic, recreational, injury, or otherwise,” R. 116 at 1,
and that monetary claims do not provide the “necessary injury-in-fact under RCRA,”
Id. at 2 (emphasis added). But Article III does not require nor bar specific injuries.
Instead, it requires only that a plaintiff show it has an injury that is “concrete and
particularized” enough to move beyond the world of individuals with only
“generalized grievances.” According to these standards, Clean Harbors has
sufficiently alleged an injury in fact—it alleges it has incurred substantial costs due
to the previous contamination of the property and continues to be injured due to the
Port District’s actions in violation of the Cap and Drain Plan. See R. 108 ¶¶ 86, 184–
185, 198–216. Clean Harbors’ injury is not the “generalized grievance” Article III
intends to deter.
Neither of the cases the Port District cites support its argument. In Premier
Assocs., Inc. v. EXL Polymers, Inc., 2010 WL 2838497 (N.D. Ga. July 19, 2010), aff’d
in part, 507 F. App’x 831 (11th Cir. 2013), the court found the counterclaimant did
not have standing under the RCRA to bring a claim because he had no injury—his
only allegations of harm were the possibility of being found liable under the RCRA
claim brought by the plaintiff. Id. at *3. The counterclaimant had alleged no other
injury other than that speculative fear. In Doyle v. Town of Litchfield, 372 F. Supp.
2d 288 (D. Conn. 2005), the court discussed monetary damages in the context of
redressability—it did not discuss whether monetary damages are sufficient to
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confer an injury in fact under Article III. In Doyle, because the plaintiff no longer
had an interest in the property when he brought suit, neither an injunction to abate
pollution nor civil penalties to deter pollution would have redressed his injuries. Id.
at 302. The plaintiff’s only possible redress was monetary damages in the form of
past cleanup costs, which are not recoverable under the RCRA. Because the
plaintiff’s injuries could not be redressed, he had not pled an injury to confer
standing under Article III. Here, however, Clean Harbors does not seek to recover
its economic damages through its RCRA claims. Instead, because it is a copermittee who alleges it will continue to suffer injury if the Port District is not
enjoined, its injuries will be redressed by injunctive relief. See Friends of the Earth,
528 U.S. at 185–86 (“It can scarcely be doubted that, for a plaintiff who is injured or
faces the threat of future injury due to illegal conduct ongoing at the time of suit, a
sanction that effectively abates that conduct and prevents its recurrence provides a
form of redress.”).
Consequently, the Court concludes that Clean Harbors has established a
basis for constitutional standing, and the Port District’s motion to dismiss on that
issue is denied.
B. Pre-Suit Notice
The Port District next argues that Clean Harbors failed to meet the pre-suit
notice requirements of the RCRA in regard to both its Endangerment and Permit
claims. Specifically, the Port District argues Clean Harbors’ pre-suit notice was
deficient because: (1) it failed to give the Port District notice that it used
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contaminated material to construct the piers (the “pier allegations”); (2) it failed to
cite any regulations or sections of the RCRA permit provisions that the Port District
violated (the “permit allegations”); and finally (3) it failed to notify the Port District
of its obstruction of access to the property as alleged in ¶ 201 of Count III (the
“obstruction allegation”). R. 112 at 5–6, 11–12; R.116 at 3.
The RCRA requires parties to notify a RCRA violator before commencing suit,
but it does not specify what notice is required. 42 U.S.C. § 6972(b). The Supreme
Court has held that notice under the RCRA is a requirement that may not be
disregarded, but has also failed to provide any direction as to the contents of the
notice. See Hallstrom v. Tillamook Cty., 493 U.S. 20, 31 (1989). The Seventh Circuit,
however, has provided guidance on what notice is required. In Atlantic States Legal
Foundation, Inc. v. Stroh Die Casting Co., 116 F.3d 814 (7th Cir. 1997), 2 the Court
concluded that not every source of pollution must be identified in a notice, but
rather that, “[i]n practical terms, the notice must be sufficiently specific to inform
the alleged violator about what it is doing wrong, so that it will know what
corrective actions will avert a lawsuit.” 116 F.3d at 819. See also N. Illinois Gas Co.
v. City of Evanston, Illinois, 162 F. Supp. 3d 654, 665 (N.D. Ill. 2016) (not requiring
the plaintiff to identify “all aspects of an endangerment and the full extent of the
endangerment,” but requiring that the notice direct the violator’s attention to the
Atlantic States interpreted a nearly identical regulatory notice provision in the
Clean Water Act. Because of the similarities between the notice provisions of the
Clean Water Act and the RCRA, courts sometimes rely on cases interpreting one
statute to interpret the other statute. See N. Illinois Gas Co. v. City of Evanston,
Illinois, 162 F. Supp. 3d 654, 664 (N.D. Ill. 2016) (listing cases).
2
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issue); Mejdreck v. Lockformer Co., 2002 WL 1838141, at *9 (N.D. Ill. Aug. 12,
2002), aff’d sub nom. Mejdrech v. Met-Coil Sys. Corp., 319 F.3d 910 (7th Cir. 2003)
(a failure to refer to a degreaser system as “underground” did not fail to meet the
notice requirements because it provided enough information to inform the violator
of the non-compliance).
Further, Congress has authorized the EPA to oversee the implementation of
the RCRA and to issue regulations with the force of law to support the RCRA’s
purposes. See 42 U.S.C. § 6912(a)(1); City of Chicago v. Envtl. Def. Fund, 511 U.S.
328, 330 (1994) (noting that RCRA implementing regulations come from the EPA).
The EPA has promulgated several regulations that provide guidance in interpreting
the RCRA, including in the interpretation of pre-suit notice requirements, as
discussed below. See 40 C.F.R. § 254.3 (discussing pre-suit notice requirements for
Permit claims).
1. Pier Allegations
The Port District argues that Clean Harbors failed to provide it with any
notice of the pier allegations in its notice letter. The Court agrees. Clean Harbors’
notice, 3 which is lengthy and cited verbatim in the footnote, only discussed the Port
3
Relevant portions of the notice are as follows:
The Port District was, at all times, the owner of the Property. The Port
District entered into a lease with one of its tenants, Hyon Waste, in the 1970s.
As the Port District’s tenant, Hyon Waste received approximately 68 million
gallons of chemical waste and treated the waste in the ground on the Property.
The Port District also allowed Hyon Waste to deposit the byproducts of this
waste treatment on other portions of the Property, thereby contributing to the
pollution at the Property. Moreover, as the Port District’s tenant, Hyon Waste,
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District’s participation in the contamination caused by Hyon Waste. See R. 108-5 at
22. There is no indication from the notice that the problematic contamination
stemmed from the piers built by the Port District. Indeed, the notice states that the
Port District contributed only as the “landlord for the Property for Hyon Waste’s
historical pollution and contamination of the Property.” Id. This notice failed to
direct the Port District’s attention to the piers as contaminants, and failed to meet
the standards set out by the Seventh Circuit in Atlantic States. Clean Harbors’ pier
allegations in both Counts II and III are dismissed for failure to provide proper presuit notice. 4
2. Permit Allegations
received “pickle liquor” or steel mill waste at the Property and the Port District
allowed Hyon Waste to bury the “pickle liquor” in the ground at the Property.
Further, while a tenant at the Property, Hyon Waste operated an incinerator
illegally, causing the City of Chicago, Department of Environment to shut it
down. The Port District benefitted financially from Hyon Waste’s
contamination of the Property and took no apparent action to abate the
environmental contamination caused by Hyon Waste.
...
Through a joint RCRA facilities investigation, the Port District and Clean
Harbors have demonstrated that Hyon Waste is a primary cause for the Work
Plan at the Property. The Port District and Clean Harbors have identified the
historical pollution at the Facility. The Port District was involved in the
storage or disposal of the hazardous waste at the Property because it served as
the landlord for the Property for Hyon Waste’s historical pollution and
contamination of the Property. The Port District failed to exercise the degree of
care necessary for an owner with respect to Hyon Waste’s pollution on the
Property. These facts, together with the Port District’s lack of cooperation with
Clean Harbors and the IEPA to abate the historical contamination at the
Property, its failure to implement the Work Plan and its failure to contribute
its fair share of the clean-up costs presents a substantial endangerment to
health and the environment. R. 108 at 21-22.
Because the Court dismisses the pier allegations, it need not reach whether Clean
Harbors alleged the piers contain “solid waste” to state a claim under the
endangerment provision. See 112 at 9–11.
4
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The EPA requires notice regarding a permit violation to include sufficient
information to allow the recipient to (1) identify the specific permit, standard,
regulation, condition, requirement, or order which has allegedly been violated; (2)
the activity alleged to constitute a violation; (3) the person or persons responsible
for the alleged violation; (4) the date or dates of the violation; and (5) the full name,
address, and telephone number of the person giving notice. 40 C.F.R. § 254.3. In its
notice letter, Clean Harbors met the first requirement by identifying the Permit and
the specific sections allegedly violated. See R. 108-5 at 21 (“The Port District’s
conduct constitutes a violation of the Permit, including Attachment I of the
Permit”). Contrary to the Port District’s arguments, 40 C.F.R. § 254.3 does not
require citation to “a single regulation or section of RCRA.” R. 112 at 11. An
identification of the “specific permit” is sufficient, which is what Clean Harbors
provided. See R. 108-5 at 21.
Clean Harbors then specified the activities that caused the violation,
including the Port District’s refusal to implement the Cap and Drain Plan, its
refusal to cooperate to execute Permit modifications, and its demand that the
engineered barrier on the property be removed. Id. This provides notice to the Port
District of the second requirement as well. The Port District does not argue that
Clean Harbors failed to satisfy the remaining requirements of 40 C.F.R. § 254.3.
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The Court finds Clean Harbors provided sufficient notice to the Port District to
inform it “about what it is doing wrong” as to the permit allegations. 5
3. Obstruction Allegation
Finally, the Port District argues that Clean Harbors’ allegations that “the
Port District has obstructed Clean Harbors from accessing the Property in order to
monitor ground water conditions in compliance with the Permit” (R. 108 ¶ 201)
were not included in the pre-suit notice and must be dismissed. Clean Harbors
provided written notice to the Port District of certain violations on October 2, 2012
and provided notice of additional violations on February 19, 2013. R. 6-5 at 21; 108–
5 at 19. The October notice accused the Port District of, among other things,
refusing to grant Clean Harbors access to the property “for the purpose of allowing
Clean Harbors to comply with conditions and requirements of the RCRA Permit,
including monitoring the facility perimeter and systems.” Id. The parties have not
indicated that the previous notice letter is invalid or has been withdrawn. The
Court finds that Clean Harbors’ October notice that the Port District refused to
grant it access to the property for purposes of monitoring sufficiently provided the
Port District notice of the allegations in ¶ 201.
The Port District’s argument that Clean Harbors failed to provide it notice of
violations of the final “Part B renewal permit which has an effective date of
September 6, 2017” (R. 112 at 12) is misguided. The allegations indicated that the
renewal was just that, a renewal of the Permit. Neither party has alerted the Court
that the Permit and its renewal differed in any way or that the violations changed
with the renewal. Accordingly, there is no reason to require Clean Harbors to
provide a second, identical notice. Clean Harbors adequately notified the Port
District of the violations of the Permit to meet the standards laid out in Hallstrom
and Atlantic States.
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C. Failure to State RCRA Claims
1. RCRA Endangerment Claim (Count II)
RCRA’s endangerment provision authorizes suit against “any past or present
generator, past or present transporter, or past or present owner or operator of a
treatment, storage or disposal facility, who has contributed or is contributing to the
past or present handling, storage, treatment, transportation, or disposal of any solid
or hazardous waste which may present an imminent and substantial endangerment
to health or the environment.” 42 U.S.C. § 6972(a)(1)(B) (emphasis added). The
Seventh Circuit has interpreted the “has contributed or is contributing to” language
of the RCRA to require active involvement and affirmative action rather than
passive conduct. Sycamore Indus. Park Assocs. v. Ericsson, Inc., 546 F.3d 847, 854
(7th Cir. 2008).
The Port District cites cases to support its argument that merely being an
owner of the property is insufficient to find it was actively involved with the
contamination. R. 112 at 8–9. But the Port District’s cases dealt with owners of
properties who had purchased the properties after the contamination, not with
owners alleged to be actively involved in the contamination. See e.g, Town &
Country Co-Op, Inc. v. Akron Prod. Co., 2012 WL 1668154, at *4 (N.D. Ohio May 11,
2012) (dismissing successor property owner but refusing to dismiss claim against
the previous owner who had allegedly contaminated the property); Marriott Corp. v.
Simkins Indus., Inc., 929 F. Supp. 396, 398 n.2 (S.D. Fla. 1996) (discussing
dismissed RCRA claim against Marriot because it was a “subsequent purchaser of
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previously contaminated property”); Interfaith Cmty. Org. v. Honeywell Int’l, Inc.,
263 F. Supp. 2d 796, 804 (D.N.J. 2003), aff’d, 399 F.3d 248 (3d Cir. 2005) (noting the
defendants are the present owners and another party “actually deposited the
contaminated material at the Site.”)
Clean Harbors alleges the Port District was the owner of the property at the
time of contamination and had an active role in the contamination—it alleges the
Port District authorized Hyon Waste to contaminate; failed to hold Hyon Waste
accountable for its contamination activities; and demands Clean Harbors remove
the engineered barrier that prevents additional contamination. See R. 108 ¶¶ 51–
53, 170–172, 185. Whether Clean Harbors can show the Port District’s role with
Hyon Waste was in fact active rather than passive is a matter for summary
judgment or trial. At this stage, however, Clean Harbors’ allegations are sufficient
to plead that the Port District “contributed or is contributing to” the contamination
to sustain its RCRA Endangerment Claim. See Carlson v. Ameren Corp., 2011 WL
223015, at *2 (C.D. Ill. Jan. 21, 2011) (finding sufficient allegations of affirmative
action when the counter-defendants prevented Ameren from accessing and
repairing the land). 6 The Port District’s motion to dismiss Count II is granted as to
the pier allegations but denied in all other respects.
The Port District argues that Carlson is wrongly decided and contradicts Seventh
Circuit precedent in Albany Bank and Trust Co. v. Exxon Mobil Corp., 310 F.3d 969
(7th Cir. 2002). R. 116 at 6. The Court disagrees. In Albany Bank, a district court
dismissed a RCRA claim after the plaintiff refused to allow Exxon on the
contaminated property. Exxon argued that the plaintiff’s actions impeded
investigation of the contamination and that the plaintiff had thus forfeited its right
to have a federal court order an investigation under RCRA. Id. at 972. The Seventh
6
18
2. RCRA Permit Claim (Count III)
Because the Court finds that Clean Harbors failed to provide pre-suit notice
as to the pier allegations, the issues remaining under Count III involve Clean
Harbors’ allegations that the Port District violated the Permit provisions by
refusing to implement the Cap and Drain Plan, refusing to execute the closure
forms, and by denying Clean Harbors access to the property. All the RCRA requires
are allegations of (1) [a] violation of (2) any permit, standard, regulation, condition,
requirement, prohibition, or order (3) which has become effective pursuant to the
RCRA. 42 U.S.C.A. § 6972(a)(1)(A). As in its argument on the Endangerment Claim,
the Port District fails to point to any case law that indicates “internal disputes
between alleged co-permittees” or “mere demand[s],” R. 112 at 13, are not violations
of the RCRA as a matter of law. Clean Harbors sufficiently alleges that the Port
District violated a RCRA permit and states a plausible claim to meet the
requirements provided by 42 U.S.C. § 6972(a)(1)(A). The Port District’s motion to
Circuit reversed and held that the plaintiff prevented entry in an attempt to settle a
dispute short of litigation, which was not sufficient to warrant dismissal of its
RCRA claim. Id. at 973. The Court listed the requirements to bring a RCRA claim,
finding that the plaintiff had made a prima facie case to meet them, and held that
courts should not “infer additional [preconditions]” on plaintiffs “without evidence of
contrary legislative intent.” Id. In Carlson, on the other hand, the counterclaimant
brought a RCRA claim against the plaintiff, and argued that the plaintiff’s refusal
to allow Ameren access to the property constituted affirmative action that allowed
the hazardous material to further degrade the land, which the court found was
sufficient to survive a motion to dismiss. Carlson v. Ameren Corp., 2011 WL 223015,
at *2 (C.D. Ill. Jan. 21, 2011). These cases have unrelated holdings. In Albany Park,
the court found that obstructive actions by a plaintiff do not bar sufficiently pled
RCRA claims. In Carlson, on the other hand, the court found that obstructive
actions by a defendant are sufficient to plead RCRA claims.
19
dismiss Count III is granted as to the pier allegations but denied in all other
respects.
II.
Unjust Enrichment (Count VIII)
In Count VIII, Clean Harbors alleges the Port District overcharged it for
rental payments. Specifically, Clean Harbors alleges the parties entered into an
amendment of the lease, which required Clean Harbors to pay the Port District a
percentage of its gross annual revenues. R. 108 ¶ 76. The payments were set to
expire in 2009, but the Port District continued to charge Clean Harbors through
2012, in an amount totaling $315,000. Id ¶ 78. Clean Harbors alleges the Port
District has refused to return the overcharge, even after Clean Harbors sent a
demand letter. Id. ¶¶ 80, 241.
As a general rule, parties may not bring unjust enrichment claims where a
contract governs. See Utility Audit Inc. v. Horace Mann Srvc. Corp., 383 F.3d 683,
688-89 (7th Cir. 2004) (“When two parties’ relationship is governed by contract, they
may not bring a claim of unjust enrichment unless the claim falls outside the
contract.”) Illinois courts, however, have allowed unjust enrichment claims based on
payments that were not included in the contract. See e.g., Stark Excavating, Inc. v.
Carter Const. Servs., Inc., 2012 IL App (4th) 110357, ¶ 38; see also Fifth Third Bank
v. Automobili Lamborghini S.P.A., 2011 WL 307406, at *4 (N.D. Ill. Jan. 26, 2011)
(“Thus, under Illinois law, a party may pursue an unjust enrichment claim for a
mistaken payment, even where a contract governs the relationship between the
parties, if the payee is not, in fact, entitled to payment.”).
20
Clean Harbors argues the overcharges were not part of the lease agreement
after 2009 and are not barred under a theory of unjust enrichment. R. 116 at 15.
Indeed, the lease amendment discusses quarterly payments only through 2009, R.
108-3 at 35, and neither the lease nor the subsequent amendments discuss
overpayments. See generally, R. 108-3. Because Clean Harbors has alleged that its
payments were mistaken, were improperly withheld, and are not covered under the
lease and its amendments, R. 108 ¶¶ 239–240, the Court finds Clean Harbors’
allegations are sufficient to bring an unjust enrichment claim under Illinois law.
The Port District’s motion to dismiss Count VIII is denied.
CONCLUSION
For the foregoing reasons, Defendant’s motion to dismiss the Third Amended
Complaint, R. 111, is (1) granted as to pier allegations in Counts II and III and (2)
denied in all other respects.
ENTERED:
Dated: February 15, 2018
Honorable Thomas M. Durkin
United States District Judge
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