Land O'Lakes Inc v. United States of America
Filing
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ORDER granting 25 Motion to Dismiss, as more fully set out. Signed by Honorable David L. Russell on 2/10/16. (jw)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA
LAND O’LAKES, INC.,
Plaintiff,
v.
UNITED STATES OF AMERCIA,
Defendant.
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Case No. CIV-15-683-R
ORDER
Before the Court is Defendant United States’ motion to dismiss this action for lack
of subject matter jurisdiction pursuant to F.R.Civ.P. 12(b)(1). In support of its motion,
Defendant argues that 28 U.S.C. § 1331 is not an independent basis for jurisdiction; that
Plaintiff’s declaratory judgment claim (Count I) is barred by § 113(h) of the
Comprehensive Environmental Response Compensation and Liability Act (“CERCLA”),
42 U.S.C. § 9613(h); that Plaintiff’s Resource Conservation and Recovery Act (“RCRA”)
claim (Count II) is barred by CERCLA § 113(h); and that Plaintiff can raise its
“defenses” when the Environmental Protection Agency files a CERCLA enforcement
action against it. Plaintiff in response argues that § 113(h) of CERCLA, 42 U.S.C. §
9613(h), does not apply because all clean-up activity at the subject site has been
completed, Plaintiff does not challenge a removal or remedial action at the site and the
EPA’s cost demand letter is not a remedial activity.
Plaintiff also argues that the
Government has waived sovereign immunity by entering into the Final Consent Decree
and Closure Order as to enforcement of the Decree; that the Government has waived
sovereign immunity in § 702 of the Administrative Procedures Act (“APA”); and that the
RCRA waives the Government’s sovereign immunity to RCRA citizen suits. Defendant
in reply asserts that Plaintiff has admitted that clean-up at the site has not been
completed, citing Amended Complaint at ¶53, and that Plaintiff’s argument ignores the
fact that the terms “removal” and “remedial action” as used in § 113(h) are defined to
include “enforcement activities related thereto,” 42 U.S.C. § 9601(25), and that the
EPA’s cost demand is an enforcement activity. Defendant also argues that the APA
waiver of sovereign immunity does not, by its terms, apply because of the withdrawal of
jurisdiction in § 113(h) of CERCLA. Finally, in its reply Defendant argues that the
RCRA’s citizen suit provision does not grant jurisdiction over Count II because Congress
did not intend to except RCRA claims from § 113(h) of CERCLA.
To understand the parties’ arguments and this Court’s analysis of them, a
description of the lengthy factual background is necessary.
Factual Background
This case concerns the operation and clean-up of the Hudson Oil Refinery
Superfund Site in Cushing, Oklahoma. An oil refinery was operated on the site from
1915 until 1982. Through the merger with its predecessor, Midland Cooperatives, Inc.
(“Midland”), Plaintiff Land O’Lakes owned and operated the site from 1943 to 1977,
when it sold the Refinery to Hudson Oil Company/Hudson Refinery Company. In
August of 1984, the EPA sued Hudson for violations of the hazardous waste management
requirements of RCRA, 42 U.S.C. § 6901-92k. The EPA did not assert any claims under
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CERCLA or any other statute against Hudson. The EPA and Hudson entered into an
RCRA Partial Consent Decree in 1987 that required Hudson to perform a Site
Investigation. In 1987, the EPA and Hudson entered a Final RCRA Consent Decree that
required Hudson to perform RCRA corrective action activities at the refinery. That
Consent Decree contained a covenant not to sue Hudson and its successors and assigns of
the Refinery for certain “corrective action claims under § 3008(h) of RCRA, 42 U.S.C. §
692a(h), for conditions addressed in the United States’ Second Amended Complaint that
were known by the United States and existing as of the date of the lodging of that Decree.
The Consent Decree contained a provision retaining this Court’s jurisdiction. Consent
Decree at ¶ 28. EPA did not covenant not to sue Hudson or its successors or assigns for
CERCLA claims. In 1994, this Court entered an Order for Closure of the 1987 Hudson
RCRA Consent Decree, stating that the obligations of the Consent Decree were satisfied
and releasing Hudson from further obligations.
Despite the clean-up operations
performed under the Consent Decree from October 1998 through December of 1999,
EPA conducted inspections, investigations and an emergency removal action under §
104(a) of CERCLA. In January of 2001, the EPA sent Plaintiff, as successor to Midland,
a Special Notice and Demand Letter under Section 107 of CERCLA requesting that
Plaintiff reimburse EPA’s past costs for the removal actions at the site and to perform a
Remedial Investigation and Feasibility Study under CERCLA concerning further cleanup of the site. Under § 107 of CERCLA, any person who owns a facility at which
hazardous substances are located may be liable for the cost of cleaning up those
substances. 42 U.S.C. §§ 9601(9) and 9607(a)(1). Plaintiff advised the EPA that it had
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no liability at the site and declined to undertake the work. Thereafter, from September
2001 through June 2003, the EPA conducted an additional CERCLA removal action at
the site and from 2004 through 2007, the EPA oversaw the Oklahoma Department of
Environmental Quality’s performance of the Remedial Investigation and Feasibility study
to identify possible remedies for cleaning up the site. In 2007, the EPA then prepared a
Record of Decision under CERCLA that selected the final cleanup remedies for the site.
In 2008, the EPA sent a Special Notice letter to Plaintiff that directed Plaintiff to
perform the remedial design and remedial action work specified in the Record of
Decision for the site. Plaintiff declined to do so. Then, in January 2009, the EPA issued
Plaintiff a unilateral administrative order under Section 106(a) of CERCLA, 42 U.S.C. §
9606(a), which required Plaintiff to do the remedial design and action work at the site.
CERCLA authorizes the EPA to issue such orders when the EPA determines there “may
be an imminent and substantial endangerment to the public health or welfare or the
environment” because of actual or threatened release of hazardous substances from a
facility. See 42 U.S.C. § 9606(a). From 2009 through 2015, the EPA oversaw Plaintiff’s
work under the unilateral administrative order.
In June of 2015, the United States sent to Plaintiff its formal demand under
CERCLA for payment of $23,424,243.76 in past costs incurred by the EPA to clean up
the site through February 28, 2015, plus interest in the amount of $4,818,215.45. The
Plaintiff did not pay these amounts but instead filed suit against the EPA in this Court
under 28 U.S.C. §§ 2201, 2202, 42 U.S.C. § 9613(g)(2) and Rules 57 and 71, F.R. Civ.
P., seeking a declaratory judgment that it is not liable to the EPA for past costs to clean
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up the site under §§ 106 or 107 of CRECLA, 42 U.S.C. §§ 9606 & 9607. On September
1, 2015, Plaintiff filed its First Amended Complaint adding a citizen suit claim under §
7002(a)(1)(A) of the RCRA, the federal hazardous waste statute, as another basis for
seeking a declaration of non-liability under CERCLA. 42 U.S.C. §§ 6901-92k; 42 U.S.C.
§ 6972(a)(1)(A). Plaintiff included a demand that the United States pay civil penalties to
Plaintiff for an alleged RCRA violation. Plaintiff alleges that a covenant not to sue
provision in the 1987 Hudson RCRA Consent Decree absolved Plaintiff of any liability at
the site, including CERCLA liability, and that the EPA violated that decree when it
issued the unilateral administrative order and “threatened” to sue Plaintiff for the EPA’s
past CERCLA response costs.
Analysis
Plaintiff, does not argue that the Court has jurisdiction over the United States
pursuant to 28 U.S.C. § 1331 so the Court does not need to address Defendant’s correct
argument that the statute does not afford an independent basis for jurisdiction over this
suit against the United States. See e.g., Goodwill Industries Service Corp v. Commission
for Purchase from People Who are Blind or Severely Disabled, 378 F.Supp.2d 1290,
1294 (D. Colo. 2005); see also Voluntary Purchasing Groups, Inc. v. Reilly, 889 F.2d
1380, 1385 (5th Cir. 1989).
Section 9601(25) of Title 42 of the United States Code defines the terms
“removal” and “remedial action” as used in § 9613(h) of that title to include
“enforcement activities related thereto.”
42 U.S.C. § 9601(25).
CERCLA, 42 U.S.C. § 9613(h), provides as follows:
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Section 113(h) of
No Federal court shall have jurisdiction under Federal Law . .
. to review any order issued under section 106(a) [42 U.S.C. §
9606(a)] of this title. . .1
Plaintiff has admitted that the EPA issued its unilateral administrative order under 42
U.S.C. § 9606(a). See Complaint at ¶ 49. Thus, 42 U.S.C. § 9613(h) bars Plaintiff’s
declaratory judgment action for a declaration of non-liability for the remedial design and
action work set forth in the unilateral administrative order and for the costs incurred by
the EPA to do the remedial action as set forth in the CERCLA demand letter as the latter
is an enforcement activity related to “remedial action.” See 42 U.S.C. § 9601(25). See
also Voluntary Purchasing Group, Inc. v. Reilly, 889 F.2d 1380, 1386-91 (10th Cir.
1989).
Plaintiff argues that the cost demand letter is not a remedial activity because
removal or remediation at the site is complete and argues that Voluntary Purchasing is
distinguishable because it is contrary to law from the Tenth Circuit, citing United States
v. Colorado, 990 F.2d 1565 (10th Cir. 1993); Aztec Minerals Corp v. EPA, 1999 WL
969270 (10th Cir. Oct. 25, 1999)(No. 98-1380); and Raytheon Aircraft Co. v. United
States, 2007 WL 1299184 (D. Kan. May 3, 2007)(No. 05-2328). None of those cases
cited by Plaintiff considered the effect of the definition in § 101(25) on § 113(h) and are
otherwise distinguishable.
In the Colorado case, the fact that remedial action was
ongoing was completely irrelevant to the Court’s determination that the suit was not
barred by 113(h), 990 F.2d at 1575-79, and the Court therein held that Colorado’s
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Section 113(b) of CERCLA, 42 U.S.C. § 9613(b), grants to the United States district courts jurisdiction over all
controversy arising under CERCLA except as otherwise explicitly provided in subsection (a) and (h) of Section
9613.
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compliance order under its EPA-delegated hazardous waste program was not a
“challenge” to the Army’s CERCLA response action. Aztec Minerals did not involve a
private party seeking to avoid liability and did not even consider whether 113(h) barred
pre-enforcement review of a person’s CERCLA liability in such circumstances.
Moreover, “remedial action” is defined by CERCLA to include “any monitoring
reasonably required to assure that such actions protect the public health and welfare and
the environment.”
42 U.S.C. § 9601(24).
And § 121, which addresses “Cleanup
Standards” indicates that long-term operation and maintenance is included as part of
“remedial action” at a site. See 42 U.S.C. § 9621(a) & (b).
Plaintiff argues that as a result of the Final Consent Decree, the Government has
waived sovereign immunity as to Counts I and II of the Amended Complaint. Plaintiff
points out that under Article XX of the Final Consent Decree, the Court retained
“jurisdiction of this Final Consent Decree for purposes of ensuring compliance with its
terms and conditions” and that “Plaintiff and Defendant each retain the right to seek to
enforce the terms of this Final Consent Decree and take any action authorized by federal
or state law not inconsistent with the terms and conditions of this Final Consent Decree
or otherwise.” Final Consent Decree at Art. XX. However, Plaintiff in this case was
neither a party to the Consent Decree nor is it an assign or successor in interest to Hudson
Oil Company/Hudson Refinery Company.
Moreover, this Court’s retention of
jurisdiction cannot override 42 U.S.C. § 9613(h). Finally, the 1987 Consent Decree and
1994 Closure Order were entered under § 3008(a) and (g) of the RCRA and do not even
reference CERCLA. Nor do the Consent Decree and Closure Order provide an exception
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to the jurisdictional bar in § 113(h). Section 113(h) contains a “blunt withdrawal” of
jurisdiction of federal courts that applies once the United States has begun its removal
action. See Cannon v. Gates, 538 F.3d 1328, 1335 (10th Cir. 2008), citing APWU v.
Potter, 343 F.3d 619, 624 (2d Cir. 2003). Section 113(h) provides specific exceptions to
this withdrawal of jurisdiction, none of which authorize pre-enforcement review of
CERCLA liability based on orders entered under § 3008 of the RCRA. See 42 U.S.C. §§
9613(h)(1) – (5). Thus, § 113(h) bars subject matter jurisdiction over Plaintiff’s claims
unless and until the EPA files a cost recovery claim under § 107 of CERCLA. At that
time, Plaintiff could pursue these claims as defenses to liability under CERCLA. See
B.R. McKay & Sons v. United States, 633 F.Supp. 1290, 1297 (D. Utah 1986).
Plaintiff also argues that the United States has waived sovereign immunity under §
702 of the Administrative Procedures Act as to claims that seek only declaratory or nonmonetary relief. However, this argument ignores the fact that § 702 itself provides that
“[n]othing herein . . . confers authority to grant relief if any other statute that grants
consent to suit expressly or impliedly forbids the relief which is sought.” 5 U.S.C. § 702.
As the Supreme Court explained in Match-E-Be-Nash-She-Wish Band of Pottawatomie
Indians v. Patchak, this exception prevents plaintiffs from exploiting the APA’s waiver to
evade limitations on suit contained in other statutes.” 132 S.Ct. 2199, 2204-05 (2012).
Plaintiff also argues that the United States waived its sovereign immunity under §
7002(a) of the RCRA, the RCRA Citizens suit provision, 42 U.S.C. § 6972(a).
Accordingly, Plaintiff argues, this Court has subject matter jurisdiction over its claims.
However, Plaintiff’s argument ignores the fact that numerous circuits, including the
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Tenth Circuit, have held that Congress did not intend to except RCRA, including the
citizen suit provision, from the broad jurisdictional bar of § 113(h) of CERCLA. See e.g.,
El Paso Natural Gas Co. v. United States, 750 F.3d 863, 880 (D.C. Cir. 2014); Cannon v.
Gates, 538 F.3d 1328, 1332-36 (10th Cir. 2008); OSI, Inc. v. United States, 525 F.3d
1294, 1297-99 (11th Cir. 2008); APWU v. Potter, 343 F.3d 619, 624 (2d. Cir. 2003);
Clinton County Commissioners v. EPA, 116 F.3d 1018, 1026-28 (3rd Cir. 1997);
McClellan Ecological Seepage Situation v. Perry, 47 F.3d 325, 328-30 (9th Cir. 1995);
Arkansas Peace Center v. Arkansas Department of Pollution Control & Ecology, 999
F.2d 1212, 1217-18 (8th Cir. 1993).
In summary, § 9613(h) of Title 42 of the United States Code bars Plaintiff’s
claims in their entirety, the Court lacking subject matter jurisdiction over them.
Accordingly, Defendant’s motion to dismiss is GRANTED and this case is DISMISSED
for lack of subject matter jurisdiction.
IT IS SO ORDERED this 10th day of February, 2016.
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