Clean Water Act Citizen Suits: Plaintiff and Defense Tactics for Litigation

Transcription

1 Presenting a live 90-minute webinar with interactive Q&A Clean Water Act Citizen Suits: Plaintiff and Defense Tactics for Litigation Notice, Standing and Jurisdiction; Interpleading Third Parties and Settlement Under the CWA TUESDAY, MARCH 13, pm Eastern 12pm Central 11am Mountain 10am Pacific Today s faculty features: Justin Hayes, Program Director, Idaho Conservation League, Boise, Idaho Eric L. Klein, Principal, Beveridge & Diamond, Washington, D.C. Nathan A. Metcalf, Partner, Hanson Bridgett, San Francisco Timothy M. Sullivan, Principal, Beveridge & Diamond, Baltimore The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions ed to registrants for additional information. If you have any questions, please contact Customer Service at ext. 1.

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5 Clean Water Act Enforcement One conservation groups thoughts about citizen suits Justin Hayes, Program Director 5

6 What are we trying to accomplish? How do we identify cases? What affects how we proceed? Justin Hayes, Program Direc 6

7 Who is the Idaho Conservation League? Are we representative of other NGOs? 7

8 What are we trying to accomplish? 8

9 How do we identify cases? 9

10 How do we identify cases? 10

11 What is ECHO? City of Wilder 65 Violations 11

12 Most Sewage Plants in Idaho Are Not Making the Grade From there were 1,768 violations of the Clean Water Act Justin Hayes, Program Director 12

13 How well did WWTPs in Idaho Perform Between ? PASS 19% (zero violations) FAIL 81% (discharge violations) 13

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15 Number of Facilities Frequency of discharge violations at Idaho WWTPs No Violations 1-10 Violations Violations Violations Violations Violations 100+ Violations

16 Percent of Total Violations Statewide 10 Worst (49%) All Others (51%) 16

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18 Number of Violations Discharge Violations at the 10 worst performing WWTPs in Idaho Inkom Plummer Nezperce Culdesac Elk River 18

19 Number of Facilities Who is going to be getting a notice letter? No Violations 1-10 Violations Violations Violations Violations Violations 100+ Violations 19

20 What affects how we proceed? Gravity of violation How did the facility respond to us? Is the facility interested in a settlement: Timely compliance Mitigation 20

21 Take home messages If your facility is violating the Clean Water Act somebody will notice Get ahead of your problem How you act can shape how we act 21

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51 Recent Developments in the Courts of Appeals Clean Water Act Citizen Suits: Defense and Litigation Strategies Timothy M. Sullivan Beveridge & Diamond, P.C. March 13, 2018

52 Recent Developments in the Courts of Appeals Permit Shield Discharges to Groundwater 52

53 Clean Water Act Prohibition against Discharge of Pollutants Except as in compliance with this section and section of this title, the discharge of any pollutant by any person shall be unlawful. 33 U.S.C (a) CWA Section 402 governs issuance of permits for discharges to navigable waters from a point source (33 U.S.C. 1342) Discharge of a pollutant = addition of any pollutant to navigable waters from any point source (33 U.S.C. 1362(12)) Point Source = any discernible, confined and discrete conveyance from which pollutants are or may be discharged including [many examples] (33 U.S.C. 1362(14)) 53

54 Permit Shield CWA Section 402(k) Compliance with a permit issued pursuant to this section shall be deemed compliance with the CWA. No CWA violation where 33 U.S.C. 1342(k) (1) the permit holder complies with the express terms of the permit and with the CWA s disclosure requirements; and (2) the permit holder does not make a discharge of pollutants that was not within the reasonable contemplation of the permitting authority at the time the permit was granted. Piney Run Preservation Ass n v. County Comm nrs of Carroll Cnty., Maryland, 268 F.3d 255, 268 (4 th Cir. 2001). 54

55 The Permit Shield in the 4th and 6th Circuits The 4th and 6th Circuits recently provided additional guidance on when the permit shield defeats liability: Sierra Club v. ICG Hazard, LLC, 781 F.3d 281(6th Cir. 2015) Ohio Valley Envt l Coalition v. Fola Coal Co., 845 F.3d 133 (4th Cir. 2017) 55

56 The Permit Shield Sierra Club v. ICG Hazard ICG operated a surface coal mine in Kentucky that discharged pursuant to a general permit for coal mines. Permit contained numeric limits for several pollutants, but not selenium. Permit required ICG to conduct one sampling for selenium over the 5 years of coverage under the general permit. Samples taken in surrounding waters showed that selenium potentially exceeded Kentucky s water quality standards. Sierra Club sued under the CWA and Surface Mining Control and Reclamation Act, 30 U.S.C et seq., based on alleged violations of water quality standards. The district court held that the permit shield barred Sierra Club s suit. 56

57 The Permit Shield Sierra Club v. ICG Hazard The Sixth Circuit affirmed and rejected the argument that, when a general permit is involved, the permit shield applies only pollutants that are explicitly listed in the permit. The court deferred to EPA s decision in In re Ketchikan Pulp Co., 7 E.A.D. 605 (May 15, 1998), the decision relied on in Piney Run Preservation Ass n, 268 F.3d 255. Ketchikan acknowledged the practical impossibility of identifying and limiting every potential compound or chemical in a given discharge in writing a permit, such that the shield s application is not limited to pollutants specifically identified. The court found no reason why this rationale would not apply to general permits. The court then held that the permit shield applied: ICG complied with its reporting requirements by disclosing the selenium discharge. The selenium discharges were within Kentucky s reasonable contemplation the permit explicitly recognized the potential for mines to discharge it. 57

58 The Permit Shield OVEC v. Fola Coal Fola operated a coal mine that discharged wastewater to Stillwater Branch. Fola s discharges contained ions and sulfates. Fola disclosed these discharges in seeking the renewal of its permit in Fola s NPDES permit contained no limits on ions and sulfates, but contained a provision incorporating by reference a W. Va. regulation that provided: The discharge or discharges covered by a WV/NPDES permit are to be of such quality so as not to cause violation of applicable water quality standards. OVEC alleged Fola violated its permit by discharging ions and sulfates in sufficient quantities to violate the permit by violating narrative water quality standards. The district court found Fola liable after a bench trial and concluded that the permit shield did not apply. 58

59 The Permit Shield OVEC v. Fola Coal The Fourth Circuit affirmed, holding that the permit s incorporation of the WV regulation made violations of water quality standards violations of the permit. The panel rejected Fola s argument that its compliance with its numeric limits in the permit barred the suit. Application of the permit shield requires compliance with the express terms of the permit. Even though Fola violated no numeric limit, it failed to comply with the permit s terms by causing an exceedance of a water quality standard. 59

60 The Permit Shield A Circuit Split? No meaningful split in the 4th and 6th Circuit approaches to the permit shield Both courts addressed whether the discharger had complied with the terms of its permit. Different outcomes stem from the differences in permit language. The takeaway: Pay attention to how your permit addresses water quality standards. Failure to do so could open the door for citizen plaintiffs. 60

61 Discharges to Groundwater Potential for four circuits to weigh in on whether discharges to hydrologically connected groundwater are actionable under the CWA. 9th Circuit: Hawai i Wildlife Fund v. Cnty. of Maui, 881 F.3d 754 (9th Cir. Feb. 1, 2018). Other cases currently being appealed 2nd Circuit: 26 Crown Street Assocs. v. Greater New Haven Water Pollution Control Authority, No th Circuit: Upstate Forever v. Kinder Morgan Energy Partners LP, No th Circuit: Tenn. Clean Waters Network v. TVA, No

62 Discharges to Groundwater County of Maui A treatment plant serving West Maui disposed of fully treated wastewater through four injection wells. Wells were permitted under SDWA. Tracer dye study showed that well discharges reached the Pacific Ocean through groundwater. Citizen plaintiffs alleged plant was violating the CWA by discharging without a NPDES permit. 2 opinions below held that these wells violated the CWA: Haw. Wildlife Fund v. Cnty. of Maui, No , 2015 WL (D. Haw. Jan. 23, 2015) Haw. Wildlife Fund v. Cnty. of Maui, 24 F. Supp. 3d 980 (D. Haw. 2014). 62

63 Discharges to Groundwater County of Maui Ninth Circuit concluded that the wells discharged in violation of the CWA. Pollutants need not enter navigable waters directly from the point source to be a discharge. Plaintiffs needed only to show that pollutants, at levels more than de minimis, were fairly traceable from the original point source (here, the wells) to navigable waters. The Panel purported to derive this new standard from cases defining nonpoint source pollution, which is not traceable to any single discrete source. 63

64 Discharges to Groundwater Cases in 3 More Circuits Cases on appeal to the 2nd, 4th, and 6th Circuits reached different conclusions on alleged discharges to groundwater. 2nd and 4th Circuit: releases to groundwater are not discharges that require NPDES permits. 26 Crown Assocs. v. Greater New Haven Regional Water Pollution Control Auth., No cv-1439 (D. Conn. July 11, 2017): Groundwater migration of sewer backflow is nonpoint source pollution not regulated by the CWA. Upstate Forever v. Kinder Morgan Energy Partners, 252 F. Supp. 3d 488 (D.S.C. 2017): Groundwater migration from pipeline leak lacked direct addition of pollutants to navigable waters necessary to support a claim 6th Circuit: Pollution reaching navigable waters from a point source via a generally traceable direct groundwater connection is sufficient to establish a discharge regulated by the CWA. Tenn. Clean Water Network v. TVA, 273 F. Supp. 3d 775 (M.D. Tenn. 2017). 64

65 Discharges to Groundwater Anticipating County of Maui Lower court opinions in both 26 Crown Assocs. and Upstate Forever warn of consequences of approach adopted by Ninth Circuit: 26 Crown Assocs.: [A]ny non-point pollution (such as ordinary surface run-off ) could invariable be reformulated by going up the causal chain to identify the initial point sources. These claims would effectively read the point source out of the Clean Water Act. Upstate Forever: To find that the pipeline directly discharged pollutants into navigable waters [where it is alleged pollutants migrated via groundwater] would result in the CWA applying to every discharge into the soil and groundwater no mater its location. All groundwater potentially flows downstream. 65

66 Discharges to Groundwater EPA Wants to Hear from You February 20, 2018: EPA issues request for comment on discharges that reach jurisdictional surface waters via groundwater or subsurface flow. 83 Fed. Reg (Feb. 20, 2018) Topics for comment include: Whether these releases should be addressed under NPDES program or other federal authorities; Whether these releases are already adequately addressed under existing state or federal programs (e.g., SDWA); and Whether EPA should clarify its previous statements concerning these releases. Comments are due May 21,

67 Questions? Timothy M. Sullivan Beveridge & Diamond, P.C. Principal, Baltimore, MD (410)

68 Clean Water Act Citizen Suits Settlement Strategies Nathan Metcalf

69 CLEAN WATER ACT CITIZEN SUITS - WHAT Citizens step into the shoes of government regulators Clean Water Act 505 (33 U.S.C. 1365(a)(1)) File a lawsuit for alleged violations of An effluent standard or limitation under the Clean Water Act An order issued by the EPA or a State Permit Industrial General Permit (IGP) 69

70 CLEAN WATER ACT CITIZEN SUITS HOW SMARTS Storm Water Multiple Application and Report Tracking System Everything is Public Permit Application Permit Terms SWPPP Compliance History Analytical Data Annual Reports 70

71 CITIZEN SUITS CLAIMS/TARGETS Failure to Obtain CWA Permit Coverage Notice of Intent (NOI) to be covered Violations of Effluent Standards or Limitations Exceeding NALs and/or benchmarks Failure to Comply with Permit Terms Incomplete/inaccurate BMPs/SWPPP and monitoring plans 71

72 CLEAN WATER ACT CITIZEN SUITS WHY Environmental Stewardship Recover attorneys fees 72

73 CITIZEN SUITS PROCESS 60-Day Notice Letter Informs about alleged violations Copy the state regulatory agency and the EPA Preempt citizen suit with enforcement action Opportunity to fix before the case is filed Opportunity to settle with the citizen group early Failure to respond within 60 days Citizen group will file a complaint in federal court 73

74 Initial Steps 60-Day Period Hire Counsel Attorney Client Privilege/ Attorney Work Product Engage citizen enforcer Hire Consultant (QISP) Litigation Hold - Keep Records Eliminate potential ongoing violations Evaluate liability and strengths/weaknesses of claims Evaluate cost/benefits of settlement 74

75 LITIGATE OR SETTLE? Business Decision Vast majority of claims settle Litigation is expensive and time consuming What is your exposure to liability? Potential penalties up to $52,414 per day, per violation What are the settlement costs and terms Citizen Enforcer will be involved in your stormwater program Requirements beyond permit conditions Flexibility on BMP s and financial terms 75

76 Litigation Consequences Litigation costs including attorneys fees Diversion of resources to fight claims Potential negative publicity Potential increased scrutiny from EPA & State 76

77 LITIGATION Discovery Facility Inspections Dry and Rainy Weather Document Requests Interrogatories and Requests for Admissions Depositions of Knowledgeable People Expert Discovery Consultants and Engineers 77

78 Civil Liability and Attorneys Fees Prevailing plaintiff entitled to attorneys fees and expert fees Liability up to $52,414 per day, per violation Factors Court considers: Seriousness of violation Economic benefit of violator History of violations Good faith efforts Economic impact of penalty 78

79 TYPICAL SETTLEMENT TERMS In Court or out of Court settlement? Two general types of relief: Injunctions Monetary payments Operational changes 79

80 INJUNCTION SETTLEMENT TERMS Yearly report to the citizen group Citizen Group Oversight Two to Five Years Facility inspections 80

81 PAYMENT SETTLEMENT TERMS Reimbursement of costs, including legal fees Environmental Project funding Payments for compliance monitoring and oversight Stipulated penalties Paid for failing to comply with consent decree terms Usually for missing deadlines 81

82 TYPICAL SETTLEMENT TERMS Update/amend operations/swppp Install additional BMPs Expensive technology or structural improvements Testing of more storm events, sample locations & constituents than required under permit Compare sample result against triggers NAL, Benchmarks, and California Toxics Rule (CTR) 82

83 SETTLEMENT TIPS Pick your battles There will be compromises Get input from a qualified consultant (QISP) Keep as close to permit terms as possible Leave operational flexibility/ BMP implementation through the term of the settlement Iterative process Performance based standards 83

84 Questions? Nathan Metcalf Hanson Bridgett (415)