State of New Mexico v. United States Environmental Protection Agency

Filing 958

MEMORANDUM OPINION AND ORDER by Chief District Judge William P. Johnson DENYING (1455 in 1:18-md-02824-WJ) New Mexico's Motion for Partial Summary Judgment REGARDING DEFENDANT ENVIRONMENTAL RESTORATION, LLC'S AMENDED DESIGNATION OF NON PARTIES AT FAULT UNDER COLO. REV. STAT. § 13-21-111.5(3)(b) [DOC. NO. 169]. Associated Cases: 1:18-md-02824-WJ, 1:16-cv-00465-WJ-LF, 1:16-cv-00931-WJ-LF, 1:17-cv-00710-WJ-SCY, 1:18-cv-00319-WJ, 1:18-cv-00744-WJ-KK, 1:22-cv-00046-WJ-KK (cmm)

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
IN RE: GOLD KING MINE RELEASE
IN SAN JUAN COUNTY, COLORADO,
ON AUGUST 5, 2015

No. 1:18-md-02824-WJ

This Document Relates to All Cases
MEMORANDUM OPINION AND ORDER
DENYING NEW MEXICO'S MOTION FOR PARTIAL SUMMARY JUDGMENT
REGARDING DEFENDANT ENVIRONMENTAL RESTORATION, LLC'S
AMENDED DESIGNATION OF NONPARTIES
THIS MATTER comes before the Court on Plaintiffs the State of New Mexico and New
Mexico Environment Department's (together "New Mexico") Motion for Partial Summary
Judgment Regarding Defendant Environmental Restoration, LLC's ("ER") Amended Designation
of Nonparties at Fault under Colo. Rev. Stat. § 13-21-111.5(3)(b), Doc. 1455, filed February 23,
2022 ("Motion").
Background
On August 17, 2017, ER filed its Amended Designation of Nonparties at Fault under Colo.
Rev. Stat. § 13-21-111.5(3)(b) stating:
ER believes that each of the Non-Parties, individually and collectively, caused
and/or contributed to (1) the conditions that resulted in the release from the Gold
King Mine on August 5, 2015 (the "Release") and/or (2) the release of substances
that Plaintiffs in this Action have alleged contaminated the Animas and San Juan
Rivers and caused their alleged damages.
Doc. 169 at 2, filed in New Mexico v. U.S. E.P.A., No. 1:16-cv-00465-WJ-LF.
Colo. Rev. Stat. § 13-21-111.5 provides:
(1) In an action brought as a result of ... injury to person or property, no defendant
shall be liable for an amount greater than that represented by the degree or
percentage of the negligence or fault attributable to such defendant that produced
the claimed injury, ... damage, or loss, ....
(2) The jury shall return a special verdict, or, in the absence of a jury, the court shall
make special findings determining the percentage of negligence or fault attributable
to each of the parties and any persons not parties to the action of whom notice has
been given pursuant to paragraph (b) of subsection (3) of this section to whom some

Case 1:16-cv-00465-WJ-LF Document 958 Filed 05/10/22 Page 2 of 8
negligence or fault is found and determining the total amount of damages sustained
by each claimant ....
(3)(a) ... the finder of fact in a civil action may consider the degree or percentage
of negligence or fault of a person not a party to the action, based upon evidence
thereof, which shall be admissible, in determining the degree or percentage of
negligence or fault of those persons who are parties to such action ....
(b) Negligence or fault of a nonparty may be considered ... if the defending party
gives notice that a nonparty was wholly or partially at fault ....
New Mexico's Motion
New Mexico states:
New Mexico's economic damages flow directly from the Blowout and its impacts
on the use and enjoyment of the waters of the State of New Mexico. New Mexico
seeks lost tax revenue resulting from the significant loss of economic activity in
San Juan County due to the Blowout and the stigma that has attached to the waters
of the State of New Mexico and the region as a direct result thereof ... This lost tax
revenue is not linked to historical contamination; rather, it flows directly from the
events of August 5, 2015 and the contamination of New Mexico's waters that
occurred in the days, weeks, and months that followed the Blowout and the
economic and stigmatic impacts on New Mexico's precious natural and economic
resources.
Motion at 13-14. New Mexico requests that the Court dismiss ER's affirmative defense of pro rata
liability "[b]ecause there is absolutely no evidence that any of ER's designated nonparties caused
or contributed in any way to the Blowout or to New Mexico's damages." Motion at 15.
Plaintiff Navajo Nation joined in New Mexico's Motion stating:
Like New Mexico, the Navajo Nation exclusively seeks damages caused by the
August 5, 2015, blowout of the Gold King Mine ... Accordingly, because—as New
Mexico's motion demonstrates—there is no evidence that any of the nonparties
listed in [ER's] Amended Designation caused or were at fault with regard to the
Blowout, summary judgment should be granted on ER's defense of pro rata liability
with respect to the Navajo Nation as well.
Doc. 1457 at 2, filed February 23, 2022. The Allen and McDaniel Plaintiff's also joined in New
Mexico's Motion with similar statements that they exclusively seek damages caused by the August
5, 2015, blowout of the Gold King Mine and that there is no evidence that any of the designated

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nonparties caused or were at fault with regard to the blowout. See Doc. 1458 at 1, filed February
24, 2022 (Allen Plaintiffs); Doc. 1506 at 1, filed March 10, 2022 (McDaniel Plaintiffs).
ER's Response
ER designated several nonparties who ER contends were at fault for New Mexico's
damages:
Most of the nonparties listed were responsible for contaminating the Animas and
San Juan Rivers for decades or more. After all, New Mexico claims it suffered
damage due to the contamination of the Animas and San Juan Rivers by the Gold
King Mine release, and that this resulted in economic and other damages. Proving
that the contamination in these rivers was caused, in whole or in part, by other
parties well before the release in question would undermine the causal link between
the release and New Mexico’s claimed damages, and would reduce ER’s share of
potential liability.
ER's Response at 4, Doc. 1501, filed March 9, 2022. ER refers to several portions of the record to
support its contention that "the contamination of the Animas and San Juan Rivers, which New
Mexico claims caused its economic damages, was caused by the designated nonparties through
historic mining activities and drainage." Response at 8-10. ER also cites to portions of the record
to support its contention that designated nonparties State of Colorado, K&P Property Designs and
San Juan Corporation are liable for contamination resulting from the August 5, 2015, release from
the Gold King Mine. See Response at 9-10 (Colorado contributed to contamination of the Animas
and San Juan River through its reclamation actions at the Gold King Mine); at 10 (the President of
San Juan Corp., which owns the Gold King and Mogul Mining properties visited the Gold King
Mine from 2005 and onward, noticed discharge from the mine that was steadily increasing, and
recognized the potential for a blowout at Gold King Mine but failed to address the issue); see also
Response at 12, 16 (stating K&P Property Designs, a contractor retained by Colorado's Department
of Resources and Mining Safety performed work at the Gold King Mine on and before the days
leading up to the release).
Weston Solutions, Inc. ("Weston") joined in ER's Response stating:
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New Mexico claims that the release event, and associated media coverage, has
caused “a long-term stigma attached to the waters of the state” that is “not linked
to historical contamination.” ... For the reasons stated in the Response, Weston
disagrees with New Mexico’s premise that any environmental stigma is altogether
unrelated to legacy mining waste.
Further, even if one grants New Mexico’s premise, dismissal of the affirmative
defense would be improper because New Mexico’s tort damage claims are not
limited to its economic damage claims. New Mexico also claims damages for
“unfunded” elements of its long-term monitoring plan and other environmental
remediation or monitoring. ... New Mexico has not made a prima facie case in the
Motion that the conduct of non-parties, including any legacy mine operators, did
not contribute to the injury for which New Mexico seeks compensation by way of
these damages.
....
New Mexico appears to proceed from a false premise: i.e., Weston and the other
Defendants may not argue that New Mexico’s damages are attributable to nonparties without filing an appropriate designation of non-parties. See Dkt. 1455, 13
(“Because there is no evidence that any of ER’s designated nonparties in any way
caused or contributed to the Blowout or Plaintiffs’ damages arising therefrom, New
Mexico is entitled to summary judgment . . . .” (Emphasis added)). This argument,
although not explicitly addressed in the Motion, misunderstands the distinction in
Colorado law between a defense to apportion damages and a defense to prorate
fault. Regardless of the Court’s decision with respect to ER’s affirmative defense
on apportionment of fault, apportionment of damages remains a viable defense.
Colorado Revised Statutes, Section 13-21-111.5(3)(b) only concerns notice
requirements pertinent to a defense seeking prorate fault to non-parties; it does not
apply to apportioning damages.
....
Although the Motion is largely directed at non-parties described as “past and
present owners and/or operators of mines or power plants” ... one of the designated
non-parties of central importance is the State of Colorado. Irrespective of whether
the Court determines that entities responsible for legacy mine waste may be
appropriately designated as non-parties at fault, the Court should permit Defendants
to put on evidence concerning the State of Colorado’s contribution to the release.
If the trier of fact determines that the excavation on August 4-5, 2015, proceeded
in a negligent manner—which Defendants dispute—then the jury must be permitted
to evaluate the degree of fault that should be apportioned to the Colorado Division
of Reclamation, Mining and Safety (“DRMS”) for its participation. There is
abundant evidence that the United States Environmental Protection Agency
(“EPA”) relied on DRMS for its expertise and guidance in formulating the plan for
excavation and for executing the operations on August 4-5, 2015 ... The Court must
permit the jury to determine what fault the State of Colorado has for its participation
in the work at the site.
Doc. 1502 at 2-6, filed March 9, 2022.
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The Federal Parties joined in ER's Response stating:
while the Motion seeks relief only against [ER], the designation of non-parties
potentially at fault filed by [ER] was sufficient notice to Plaintiffs to benefit all
Defendants that have brought an appropriate affirmative defense seeking to
apportion liabilities with non-parties ... The Federal Parties pled an affirmative
defense concerning the apportionment of liability ... Accordingly, the Motion
affects the Federal Parties' interests.
Doc. 1503 at 1-2, filed March 9, 2022.
New Mexico's Reply
New Mexico argues that "ER cannot recast the allegations about New Mexico's economic
damages from the Blowout as claims concerning general environmental pollution." New Mexico's
Reply at 13, Doc. 1513, filed March 23, 2022. New Mexico states:
The economic damages sought by New Mexico in connection with its tort claims
flow directly from the Blowout and its immediate effects upon the waters of the
State. ER cannot link these damages to historic or unrelated contamination from
mines, power plants, and industries in the broader Four Corners region; such
contamination is factually and legally unrelated to New Mexico's economic
damages. New Mexico has demonstrated its damages by comparing the robust
economic activity and uses of the Animas and San Juan Rivers before the Blowout
with the diminished economic activity after the Blowout ... New Mexico's tort
claims and damages arise from the change in the economy caused by the Blowout.
....
While New Mexico does claim both environmental and economic injuries from the
Blowout, its pleadings deliberately and plainly distinguish between historical
contamination of the Animas and San Juan Rivers and the significant and
stigmatizing plume of contamination released from the Blowout, alleging that only
the latter caused its economic injuries.
Reply at 5, 14 (emphasis in original).
Discussion
The Court denies New Mexico's Motion to dismiss ER's affirmative defense of pro rata
liability. New Mexico argues that "there is absolutely no evidence that any of ER's designated
nonparties caused or contributed in any way to the Blowout or to New Mexico's damages." Motion
at 15. However, ER has cited to portions of the record to support its contention that designated
nonparties State of Colorado, K&P Property Designs and San Juan Corporation are liable for
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contamination resulting from the August 5, 2015, release from the Gold King Mine. See Response
at 9-10; see also Weston's Notice of Joinder at 4-5, Doc. 1502 (citing to portions of the record to
support the contention that designated nonparty State of Colorado is liable for contamination
resulting from the August 5, 2015, release from the Gold King Mine).
New Mexico states:
ER cannot recast the allegations about New Mexico's economic damages from the
Blowout as claims concerning general environmental pollution ... at most, ER has
offered evidence that a handful of the designated nonparties may be considered "at
fault" for contributing to historical contamination in the Animas and San Juan
Rivers. To the extent that ER can demonstrate historical sources of this
contamination are driving response and remediation costs, those sources may be
relevant only to New Mexico's CERCLA claims.
New Mexico's Reply at 13. "New Mexico argues that the Blowout itself and its economic
repercussions caused its tort damages." New Mexico's Reply at 6 (emphasis in original). While
New Mexico alleges that the Blowout caused New Mexico's economic damages, such as
"economic losses from reduced economic activity and associated taxes, fees, and income due to,
inter alia, reduced agricultural, cultural, and tourist activities," Motion at 7, New Mexico's Second
Amended Complaint alleges that historical contamination by Kinross, Kinross Gold U.S.A. and
Sunnyside Gold also caused its tort damages. New Mexico asserts the following tort claims:
(i)

Public Nuisance against the USA, EPA, ER, Weston, Kinross, Kinross Gold and

Sunnyside Gold.

See New Mexico's Second Amended Complaint ("NM SAC") at 46-51,

Doc. 339, filed October 17, 2019, at 46-51. New Mexico alleges:
Kinross, Kinross Gold U.S.A., and Sunnyside Gold knew or should have known
that ending the treatment of the acid mine drainage from the Sunnyside mine pool
would send vast amounts of contamination into New Mexico’s waters. In fact,
immediately after the shuttering of the Gladstone treatment facility, the water
quality of the Animas and San Juan Rivers declined ... Sunnyside Gold's discharges
of contamination flowed into New Mexico and beyond, degrading New Mexico's
waters and riverbeds for more than a decade ... These releases have interfered
with and continue to interfere with New Mexico's and the public's use and
enjoyment of the rivers and surrounding areas. These releases also present an
unreasonable and substantial danger to the public's health and safety ... New
Mexico has and will continue to suffer lost economic activity, tax revenues, and
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stigmatic damages arising from these releases ... This public nuisance will continue
as long as the Animas and San Juan Rivers and surrounding areas are contaminated
with the hazardous substances released from the Gold King and Sunnyside mine
pool ... New Mexico is entitled to recover damages from the United States, [ER],
Weston ... New Mexico is entitled to entry of an order compelling the United States
... [ER], Weston ... jointly and severally, to abate the nuisance.
NM SAC at 46-47, ¶ 153; at 50-51, ¶¶ 164-165, 169-170 (emphasis added).
(ii) Trespass against the USA, ER, Weston, Kinross, Kinross Gold and Sunnyside Gold. See NM
SAC at 51-54. New Mexico alleges:
Kinross, Kinross Gold U.S.A., and Sunnyside Gold knew or should have known
that stopping the treatment of the acid mine drainage from the Sunnyside mine pool
would send vast amounts of contamination into New Mexico’s waters and beyond.
In fact, immediately after the shuttering of the Gladstone treatment facility, the
water quality of the Animas and San Juan Rivers declined, and native trout all but
disappeared in the Animas above Durango, Colorado. Sunnyside Gold’s
discharges of contamination have degraded New Mexico’s waters and
riverbeds for more than a decade ... New Mexico is entitled to recover
compensatory and restitutionary damages from Environmental Restoration,
Kinross, Kinross Gold U.S.A., and Sunnyside Gold ... New Mexico is entitled to
entry of an order compelling Environmental Restoration, Kinross, Kinross Gold
U.S.A., and Sunnyside Gold, jointly and severally, to abate the trespass.
NM SAC at 52, ¶ 175; at 54, ¶¶ 182, 184-185 (emphasis added).
(iii)

Negligence and Gross Negligence against the USA, ER, Weston, Kinross, Kinross Gold

and Sunnyside Gold. See NM SAC at 54-56. New Mexico alleges:
Kinross, Kinross Gold U.S.A., and Sunnyside Gold were negligent or grossly
negligent by plugging the American Tunnel and surrounding mine portals, thereby
creating a highly hazardous condition within the Gold King Mine. Kinross, Kinross
Gold U.S.A., and Sunnyside Gold were negligent or grossly negligent by failing to
treat the discharges from the American Tunnel and surrounding mine portals ... The
United States, through its agency EPA, Environmental Restoration, and Weston
Solutions were negligent or grossly negligent by [performing various activities at
the Gold King Mine] ... The conduct of the United States, through its agency EPA,
Environmental Restoration, Weston Solutions, Kinross, Kinross Gold U.S.A., and
Sunnyside Gold caused direct and identifiable harms to New Mexico and its
citizens. The harm caused by these defendants’ tortious conduct is indivisible and
they are jointly and severally liable. New Mexico is entitled to recover
compensatory damages from the United States, through its agency EPA,
Environmental Restoration, Weston Solutions, Kinross, Kinross Gold U.S.A., and
Sunnyside Gold.
NM SAC at 55-56, ¶¶ 189-194. New Mexico also alleges that the Upper Animas River Basin
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contains hundreds of inactive or abandoned mines, among them the Gold Kin Mine
... and the much larger Sunnyside Mine ... was mined extensively for metals ... from
the 1870s to the mid-1990s" ... Historic mining activities significantly increased the
exposure of the mineralized rock ... [which] increased the amount of heavy metals
and acidity, known as acid mine drainage, which reaches surface water and
sediments.
NM SAC at 8, ¶¶ 21-22. While New Mexico's "economic" damages may be a direct result of the
Blowout, New Mexico's tort claims also seek damages for degradation of the riverbed, which has
resulted in part from historical contamination, and an order compelling the USA, ER, Weston and
others to abate the public nuisance and trespass.
IT IS ORDERED that Plaintiffs the State of New Mexico and New Mexico Environment
Department's Motion for Partial Summary Judgment Regarding Defendant Environmental
Restoration, LLC's Amended Designation of Nonparties at Fault under Colo. Rev. Stat. § 13-21111.5(3)(b), Doc. 1455, filed February 23, 2022, is DENIED.

________________________________________
WILLIAM P. JOHNSON
CHIEF UNITED STATES DISTRICT JUDGE

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