LSI 2010 NRD Santa Fe final conference binder 072110.pdf
LSI 2010 NRD Santa Fe final conference binder 072110.pdf
LSI 2010 NRD Santa Fe final conference binder 072110.pdf
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Copyright <strong>2010</strong> by Law Seminars International
<strong>Fe</strong>aturing Speakers From:<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource<br />
Damages<br />
If you<br />
cannot attend<br />
-Live Webcast Availablefor<br />
this program<br />
Natural Resource Damages Conference<br />
July 15 & 16, <strong>2010</strong> | <strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
La Fonda <strong>Santa</strong> <strong>Fe</strong> Hotel<br />
Yes!<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
New developments and best strategies<br />
July 15 & 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
La Fonda <strong>Santa</strong> <strong>Fe</strong> Hotel<br />
Credits: <br />
Quick when/where: <br />
800 Fifth Avenue, Suite 101, Seattle, WA 98104<br />
tel (206)567-4490 or (800)854-8009<br />
fax (206)567-5058 | www.lawseminars.com<br />
10<strong>NRD</strong>NM WS
Thursday, July 15, <strong>2010</strong><br />
Natural Resource Damages Conference<br />
8:00 Registration and Continental Breakfast<br />
8:30 Introduction and Overview<br />
<br />
<br />
<br />
<br />
<br />
<br />
8:45 The U.S. Department of Justice’s Perspective on<br />
Natural Resource Damage (<strong>NRD</strong>) Claims<br />
<br />
<br />
<br />
<br />
9:15 Sources, Nature and Relative Strength of <strong>NRD</strong> Claims<br />
10:00 Break<br />
<br />
<br />
<br />
<br />
<br />
<br />
10:15 Defenses to Claims of Natural Resource Damages<br />
<br />
<br />
<br />
11:15 Cooperative <strong>NRD</strong>As: Fact or Fiction<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
12:15 Lunch (on your own)<br />
1:30 What’s Next in <strong>NRD</strong> Assessment/Litigation/Settlement?<br />
About the Conference<br />
<br />
<br />
<br />
<br />
2:15 Lessons Learned from Managing Complex <strong>NRD</strong> Cases<br />
3:45 Break<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
4:00 Case Law Update and <strong>NRD</strong> Claims Around the Country<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
5:00 Continue the Exchange of Ideas: Reception for<br />
Attendees and Faculty<br />
<br />
<br />
L AW S E M I N A R S<br />
INTERNATIONAL<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
www.lawseminars.com
Friday, July 16, <strong>2010</strong><br />
Natural Resource Damages Conference<br />
8:00 Continental Breakfast<br />
8:30 Strategies for Determining Baseline<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
9:30 Bankruptcy and <strong>NRD</strong><br />
<br />
<br />
<br />
10:15 Break<br />
<br />
<br />
10:30 Settlement of <strong>NRD</strong> Litigation<br />
<br />
<br />
<br />
<br />
<br />
<br />
11:30 Estimation of Restoration and Compensable<br />
Value Damages<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
12:30 Evaluations and Adjourn<br />
To Register:<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Tuition: <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Substitution & Cancellation:<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Registration & Other Conference Information<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Seminar Location: <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Upcoming Seminars:<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
See more at www.lawseminars.com<br />
Three Easy Ways to Register<br />
Online: www.lawseminars.com<br />
Phone: (800) 854-8009<br />
Fax: (206) 567-5058<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Continuing Education Credits:<br />
<br />
<br />
<br />
<br />
If You Cannot Attend:
James A. Bruen, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Richard O. Curley, Jr.,<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
David J. Lazerwitz, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
John Carlucci, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Nathaniel Barber, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Paul D. Boehm, Ph.D.,<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Faculty: Natural Resource Damages Conference July 15 & 16, <strong>2010</strong><br />
John C. Cruden, <br />
<br />
<br />
<br />
<br />
<br />
<br />
John K. Dema, <br />
<br />
<br />
<br />
<br />
<br />
William H. Desvousges, Ph.D.,<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Rick Dunford, Ph.D., <br />
<br />
<br />
<br />
<br />
Donald W. Fowler, <br />
<br />
<br />
<br />
<br />
<br />
Ken Frank <br />
<br />
<br />
Ira Gottlieb, <br />
<br />
<br />
<br />
<br />
<br />
Andrew O. Guglielmi, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Amy L. Horner, <br />
<br />
<br />
<br />
<br />
<br />
<br />
Brian D. Israel, <br />
<br />
<br />
<br />
<br />
Bill Jackson, <br />
<br />
<br />
<br />
<br />
<br />
J. Scott Janoe, <br />
<br />
<br />
<br />
Kenneth Jenkins, Ph.D., <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Allan Kanner, <br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Scott E. Kauff, <br />
<br />
<br />
<br />
<br />
<br />
Linda R. Larson, <br />
<br />
<br />
<br />
<br />
<br />
Angus Macbeth, <br />
<br />
<br />
<br />
<br />
<br />
<br />
Jean Martin <br />
<br />
Michael R. Thorp, <br />
<br />
<br />
<br />
<br />
<br />
<br />
Robert E. Unsworth, <br />
<br />
<br />
<br />
<br />
<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
La Fonda <strong>Santa</strong> <strong>Fe</strong> Hotel<br />
100 E. San Francisco Street<br />
(505) 982-5511<br />
Who Should Attend:<br />
<br />
<br />
<br />
<br />
<br />
You Will Learn About:<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
To Register:<br />
Mail<br />
800 Fifth Ave., Suite 101<br />
Seattle, WA 98104<br />
Phone<br />
(206) 567-4490<br />
or (800) 854-8009<br />
Fax<br />
(206) 567-5058<br />
Email<br />
registrar@lawseminars.com<br />
www.lawseminars.com
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong>, in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
Table of Contents<br />
Topic Speaker #<br />
Introduction and Overview<br />
James A. Bruen 1<br />
Richard O. Curley, Jr. 2<br />
David J. Lazerwitz 3<br />
The U.S. Department of Justice's Perspective on Natural Resource Damage (<strong>NRD</strong>) Claims<br />
John C. Cruden 4<br />
Sources, Nature and Relative Strength of <strong>NRD</strong> Claims<br />
Brian D. Israel 5<br />
Defenses to Claims of Natural Resource Damages<br />
David J. Lazerwitz 6<br />
Cooperative <strong>NRD</strong>As: Fact or Fiction<br />
Richard O. Curley, Jr. 7<br />
Andrew O. Guglielmi 8<br />
Kenneth Jenkins 9<br />
What's Next in <strong>NRD</strong> Assessment/Litigation/Settlement?<br />
Lessons Learned from Managing Complex <strong>NRD</strong> Cases<br />
Amy L. Horner 10<br />
Ira Gottlieb 11<br />
John Carlucci 12<br />
Nathaniel Barber 13<br />
Ken L. Frank 14<br />
Sheri L. Moreno 15<br />
Page 1 of 2<br />
800 Fifth Avenue, Suite 101, Seattle, WA 98104 | 206 567 4490 | 800 854 8009 | fax 206 567 5058<br />
www.lawseminars.com
Table of Contents<br />
Topic Speaker #<br />
Case Law Update and <strong>NRD</strong> Claims Around the Country<br />
John K. Dema 16<br />
Bill Jackson 17<br />
Strategies for Determining Baseline<br />
Bankruptcy and <strong>NRD</strong><br />
Settlement of <strong>NRD</strong> Litigation<br />
Estimation of Restoration and Compensable Value Damages<br />
Scott E. Kauff 18<br />
Michael R. Thorp 19<br />
Paul D. Boehm 20<br />
Linda R. Larson 21<br />
J. Scott Janoe 22<br />
Allan Kanner 23<br />
Angus Macbeth 24<br />
Robert E. Unsworth 25<br />
Rick Dunford 26<br />
William H. Desvousges 27<br />
Donald W. Fowler 28<br />
Page 2 of 2
Faculty<br />
Natural Resource Damages<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Mr. Nathaniel Barber<br />
New York State Department of<br />
Environmental Conservation<br />
625 Broadway<br />
14th Floor<br />
Albany, NY 12207-2942<br />
T: (518) 402-9502 F: (518) 402-9018<br />
Email: nhbarber@gw.dec.state.ny.us<br />
Mr. James A. Bruen<br />
Farella Braun + Martel LLP<br />
235 Montgomery Street<br />
17th Floor<br />
San Francisco, CA 94104<br />
T: (415) 954-4430 F: (415) 954-4480<br />
Email: jbruen@fbm.com<br />
Mr. John C. Cruden<br />
U.S. Department of Justice<br />
950 Pennsylvania Ave NW<br />
Environmental And Natural Resources<br />
Division<br />
Washington, DC 20530-0001<br />
T: (202) 514-2000 F:<br />
Email: john.cruden@usdoj.gov<br />
Dr. Paul D. Boehm<br />
Exponent, Inc.<br />
One Clock Tower Place<br />
Suite 150<br />
Maynard, MA 01754<br />
T: (978) 461-4601 F: (978) 461-4699<br />
Email: pboehm@exponent.com<br />
Mr. John Carlucci<br />
U.S. Department of the Interior<br />
1849 C Street, NW<br />
MS-6560 MIB<br />
Washington, DC 20460-0001<br />
T: (202) 208-4145 F:<br />
Email: JOHN.CARLUCCI@sol.doi.gov<br />
Mr. Richard O. Curley, Jr.<br />
Curley & Associates LLC<br />
21982 Paradise Circle<br />
Golden, CO 80401-9437<br />
T: (720) 746-0901 F:<br />
Email: rcurley@curleylegal.com<br />
800 Fifth Avenue, Suite 101, Seattle, WA 98104 | 206 567 4490 | 800 854 8009 | fax 206 567 5058<br />
www.lawseminars.com
Faculty for Natural Resource Damages (con't)<br />
Mr. John K. Dema<br />
Law Offices of John K. Dema, P.C.<br />
1236 Strand Street<br />
Suite 103<br />
Christiansted, VI 00820-5034<br />
T: (340) 773-6142 F: (340) 773-3944<br />
Email: jdema@lojkd.com<br />
Dr. Rick Dunford<br />
Environmental Economics Services,<br />
LLC<br />
3029 Sylvania Drive<br />
Raleigh, NC 27607<br />
T: (919) 827-3360 F:<br />
Email: rickdunford@earthlink.net<br />
Mr. Ken L. Frank<br />
Chevron Environmental Management<br />
Company<br />
6001 Bollinger Canyon Road<br />
Room 3012<br />
San Ramon, CA 94583<br />
T: (925) 543-1754 F: (925) 543-2324<br />
Email: kenfrank@chevron.com<br />
Mr. Andrew O. Guglielmi<br />
New York State Department of<br />
Environmental Conservation<br />
625 Broadway<br />
14th Floor<br />
Albany, NY 12207-2942<br />
T: (518) 402-9202 F: (518) 402-9018<br />
Email: aoguglie@gw.dec.state.ny.us<br />
Mr. Brian D. Israel<br />
Arnold & Porter LLP<br />
555 12th Street NW<br />
Suite 100<br />
Washington, DC 20004-1206<br />
T: (202) 942-6546 F:<br />
Email: Brian.Israel@aporter.com<br />
Dr. William H. Desvousges<br />
W. H. Desvousges & Associates<br />
PO Box 99203<br />
Raleigh, NC 27624<br />
T: (919) 847-7101 F: (919) 847-7445<br />
Email: william.desvousges@whdesvousgesa<br />
ssociates.com<br />
Mr. Donald W. Fowler<br />
Hollingsworth LLP<br />
1350 I Street NW<br />
Suite 900<br />
Washington, DC 20005-7204<br />
T: (202) 898-5840 F: 202.682.1639<br />
Email: dfowler@hollingsworthllp.com<br />
Mr. Ira Gottlieb<br />
McCarter & English, LLP<br />
100 Mulberry St<br />
Four Gateway Center<br />
Newark, NJ 07102-4056<br />
T: (973) 639-7984 F: (973) 297-3976<br />
Email: igottlieb@mccarter.com<br />
Ms. Amy L. Horner<br />
U.S. Department of the Interior<br />
1849 C Street NW<br />
MS-6560 MIB<br />
Washington, DC 20240<br />
T: (202) 208-6356 F: (202) 208-3877<br />
Email: amy.horner@sol.doi.gov<br />
Mr. Bill Jackson<br />
Jackson Gilmour & Dobbs, PC<br />
3900 Essex Ln Ste 700<br />
Houston, TX 77027-5166<br />
T: (713) 355-5050 F:<br />
Email: bjackson@jgdpc.com<br />
Faculty Page 2 of 3
Faculty for Natural Resource Damages (con't)<br />
Mr. J. Scott Janoe<br />
Baker Botts LLP<br />
910 Louisiana St<br />
One Shell Plaza<br />
Houston, TX 77002-4995<br />
T: (713) 229-1553 F: (713) 229-7953<br />
Email: scott.janoe@bakerbotts.com<br />
Mr. Allan Kanner<br />
Kanner & Whiteley, L.L.C.<br />
701 Camp Street<br />
New Orleans, LA 70130-3701<br />
T: (504) 524-5777 F: (504) 524-5763<br />
Email: A.Kanner@Kanner-Law.com<br />
Ms. Linda R. Larson<br />
Marten Law PLLC<br />
1191 Second Avenue<br />
Suite 2200<br />
Seattle, WA 98101-3421<br />
T: (206) 292-2612 F: (206) 292-2601<br />
Email: llarson@martenlaw.com<br />
Mr. Angus Macbeth<br />
Sidley Austin LLP<br />
1501 K Street NW<br />
Suite 600<br />
Washington, DC 20005-1402<br />
T: (202) 736-8271 F: (202) 736-8711<br />
Email: amacbeth@sidley.com<br />
Mr. Michael R. Thorp<br />
Summit Law Group<br />
315 Fifth Avenue S<br />
Suite 1000<br />
Seattle, WA 98104-2682<br />
T: (206) 676-7000 F: (206) 676-7001<br />
Email: miket@summitlaw.com<br />
Dr. Kenneth Jenkins<br />
ARCADIS<br />
140 2nd Street<br />
Suite 200<br />
Petaluma, CA 94952-7425<br />
T: (707) 874-1105 F: (707) 776-0850<br />
Email: ken.jenkins@arcadis-us.com<br />
Mr. Scott E. Kauff<br />
Law Offices of John K. Dema, P.C.<br />
11300 Rockville Pike<br />
Suite 112<br />
Rockville, MD 20852-3042<br />
T: (301) 881-5900 F:<br />
Email: skauff@lojkd.com<br />
Mr. David J. Lazerwitz<br />
Farella Braun + Martel LLP<br />
235 Montgomery Street<br />
17th Floor<br />
San Francisco, CA 94104<br />
T: (415) 954-4400 F: (415) 954-4480<br />
Email: dlazerwitz@fbm.com<br />
Ms. Sheri L. Moreno<br />
General Electric Company<br />
319 Great Oaks Blvd<br />
Albany, NY 12203<br />
T: (518) 862-2708 F:<br />
Email: Sheri.Moreno@ge.com<br />
Mr. Robert E. Unsworth<br />
Industrial Economics, Incorporated<br />
2067 Massachusetts Ave<br />
4th Floor<br />
Cambridge, MA 02140-1337<br />
T: (617) 354-0074 F:<br />
Email: reu@indecon.com<br />
Faculty Page 3 of 3
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Introduction and Overview<br />
James A. Bruen, Esq.<br />
Farella Braun + Martel LLP<br />
San Francisco, CA<br />
Richard O. Curley, Jr., Esq.<br />
Curley & Associates LLC<br />
Golden, CO<br />
David J. Lazerwitz, Esq.<br />
Farella Braun + Martel LLP<br />
San Francisco, CA
James A. Bruen of Farella Braun + Martel LLP Speaker 1: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
James A. Bruen of Farella Braun + Martel LLP Speaker 1: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 2: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 2: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 3: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 3: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
The U.S. Department of Justice's Perspective on<br />
Natural Resource Damage (<strong>NRD</strong>) Claims<br />
John C. Cruden, Esq.<br />
U.S. Department of Justice<br />
Washington, DC
John C. Cruden of U.S. Department of Justice Speaker 4: 1<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John C. Cruden of U.S. Department of Justice Speaker 4: 2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Sources, Nature and Relative Strength of <strong>NRD</strong><br />
Claims<br />
Brian D. Israel, Esq.<br />
Arnold & Porter LLP<br />
Washington, DC
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 1<br />
Sources, Nature & Relative<br />
Strength of <strong>NRD</strong> Claims<br />
Brian D. Israel<br />
<strong>LSI</strong> Natural Resources Damages Conference<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
July 15, <strong>2010</strong><br />
7/15/<strong>2010</strong> Brian D. Israel<br />
1<br />
The Roots of <strong>NRD</strong> Jurisprudence:<br />
The Ancient Public Trust Doctrine<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 2<br />
Defining the public trust<br />
“Lands under tide waters . . . are of great value<br />
to the public . . . . Their improvement by<br />
individuals, when permitted, is incidental or<br />
subordinate to the public use and right.<br />
Therefore, the title and the control of them are<br />
vested in the sovereign, for the benefit of the<br />
whole people.” Shively v. Bowlby, 152 U.S. 1 (1894)<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
3<br />
People v. Gold Run Ditch & Mining Co.<br />
(California Supreme Court 1884)<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 3<br />
People v. Gold Run Ditch & Mining Co.<br />
(California Supreme Court 1884)<br />
Gold Run Ditch and Mining Company operated a hydraulic<br />
mine near the banks of the American and Sacramento<br />
rivers in California.<br />
The company discharged hundreds of thousands of cubic<br />
yards of gravel, sand and cobble—material extracted<br />
during the mining process—into the rivers.<br />
The mining debris polluted the water downstream,<br />
impaired navigation on the rivers, and increased the<br />
chance of flooding due to higher river beds.<br />
The state sued on grounds that the river was held in public<br />
trust and that defendant’s actions were a public nuisance.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
5<br />
People v. Gold Run Ditch & Mining Co.<br />
(California Supreme Court 1884)<br />
Defendant responded that it had acquired the<br />
right to discharge debris into the river by custom.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 4<br />
Gold mining on the shores of the Sacramento river<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
7<br />
People v. Gold Run Ditch & Mining Co.<br />
(California Supreme Court 1884)<br />
Holding:<br />
Defendant was permanently enjoined from<br />
discharging debris into the rivers.<br />
“[T]he rights of the people in the navigable rivers<br />
of the State are paramount and controlling. The<br />
State holds the absolute right to all navigable<br />
waters and the soils under them . . . . The soil<br />
she holds as trustee of a public trust for the<br />
benefit of the people.”<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 5<br />
People v. Gold Run Ditch & Mining Co.<br />
(California Supreme Court 1884)<br />
Court also unimpressed with argument that the<br />
company’s actions, taken alone, would not have<br />
caused the entirety of the nuisance.<br />
“It is no answer to a complaint of nuisance that a<br />
great many others are committing similar acts of<br />
nuisance. Each and every one is liable to a<br />
separate action…<br />
…and to be restrained.”<br />
Holding related to injunctive relief, not damages.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
9<br />
Illinois Central R.R. v. Illinois<br />
(U.S. Supreme Court 1892)<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 6<br />
United States Supreme Court, 1890<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
11<br />
Illinois Central R.R. v. Illinois<br />
(U.S. Supreme Court 1892)<br />
State of Illinois granted 1,000 acres of<br />
submerged shorefront lands on Lake Michigan<br />
to railroad company.<br />
Four years later, the State repealed the grant<br />
and the railroad sued for violation of due<br />
process.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 7<br />
Lake Michigan, early 1900s<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
13<br />
Illinois Central R.R. v. Illinois<br />
(U.S. Supreme Court 1892)<br />
Holding: There was no constitutional issue<br />
because the original grant was invalid: the<br />
submerged lands under the Lake were part of<br />
the public trust and could not be transferred.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 8<br />
Illinois Central R.R. v. Illinois<br />
(U.S. Supreme Court 1892)<br />
The public trust is “for the people of the state,<br />
that they may enjoy the navigation of the waters,<br />
carry on commerce over them, and have liberty<br />
of fishing therein . . . .”<br />
“The State can no more abdicate its trust over<br />
property in which the whole people are<br />
interested . . . than it can abdicate its police<br />
powers in the administration of government and<br />
the preservation of the peace.”<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
15<br />
Appleby v. City of New York<br />
(US Supreme Court 1926)<br />
Manhattan wharf, 1930s<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
16<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 9<br />
Appleby v. City of New York<br />
(US Supreme Court 1926)<br />
Similar facts to Illinois Central: New York City<br />
granted titles of parcels submerged beneath the<br />
Hudson river to Appleby.<br />
In return, Appleby paid for the lots and promised<br />
to develop portions of the harbor by building<br />
wharves.<br />
New York City later sought to dredge portions of<br />
the conveyed parcels, and use other portions for<br />
mooring purposes.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
17<br />
Piers of lower Manhattan, 1924<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
18<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 10<br />
Appleby v. City of New York<br />
(US Supreme Court 1926)<br />
Holding: The conveyed parcels of submerged<br />
land were not part of the public trust. The grant<br />
to Appleby was valid.<br />
Why the difference between Illinois Central and<br />
Appleby?<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
19<br />
Appleby v. City of New York<br />
(US Supreme Court 1926)<br />
Size: The area conveyed in Illinois Central was<br />
three times larger than in Appleby. The land grant<br />
in Illinois “was a gross perversion of the trust over<br />
the property under which it was held” but the<br />
smaller land grant to Appleby was acceptable.<br />
Public interest: Unlike Illinois Central, the public<br />
interest in Appleby was to promote the<br />
development of the harbor. It was both very well<br />
defined and related to navigation. In Illinois, the<br />
public interest was not as clear.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
20<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 11<br />
North Dakota v. Dickinson Cheese Co<br />
(North Dakota Supreme Court 1972)<br />
Heart River, North Dakota<br />
7/15/<strong>2010</strong> 21<br />
Brian D. Israel<br />
North Dakota v. Dickinson Cheese Co<br />
(North Dakota Supreme Court 1972)<br />
The state sued the Dickinson Cheese Company<br />
for discharging whey into the Heart River.<br />
The state claimed that the discharge killed<br />
thousands of fish and also damaged the river for<br />
12 miles downstream.<br />
The state sought damages for the value of the<br />
fish.<br />
The defendant challenged the standing of the<br />
state to sue for damages.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
22<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 12<br />
Cheese shredding at a North Dakota cheese plant<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
23<br />
North Dakota v. Dickinson Cheese Co<br />
(North Dakota Supreme Court 1972)<br />
Holding: the state lacked standing.<br />
The court admitted that the power to protect fish and<br />
game was an “inherent attribute of the state’s<br />
sovereign power.”<br />
However, the state’s interest in the fish was not<br />
sufficient for the purposes of standing. The state’s<br />
interest was that of a sovereign, not an owner:<br />
“As sovereign, the State has the power to determine<br />
when and under what conditions fish running wild may<br />
be taken and thus reduced to ownership, but it does<br />
not have such property interest in the fish . . .<br />
sufficient to support a civil action for damages for the<br />
destruction of those fish.”<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
24<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 13<br />
New Jersey v. New Jersey Cent. Light & Power Co.<br />
(New Jersey Supreme Court 1976)<br />
Oyster Creek Nuclear Generating Station<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
25<br />
New Jersey v. New Jersey Cent. Light & Power Co.<br />
(New Jersey Supreme Court 1976)<br />
State brought claim against nuclear power company<br />
for discharging large amounts of cold water into<br />
Oyster creek, a tidal stream near the facility.<br />
The state alleged that the cold water killed a large<br />
number of menhaden fish in the stream:<br />
– The fish had been attracted to the warmer waters created by<br />
the company’s typical, warmer discharges into the river.<br />
– The fish were killed when the company suspended operation<br />
for a few days, and discharged unheated water.<br />
The state filed suit both under the public trust doctrine<br />
and under New Jersey environmental statutes.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
26<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 14<br />
Oyster Creek Nuclear Generating Station<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
27<br />
Menhaden fish<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
28<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 15<br />
New Jersey v. New Jersey Cent. Light & Power Co.<br />
(New Jersey Supreme Court 1976)<br />
Holding: the state had failed to show cause-in-fact:<br />
The temperature in the creek would have dropped in<br />
any case, due to changes in the tide and dissipation<br />
of warm water:<br />
“Although pumping [cold] water into Oyster Creek<br />
may have accelerated the temperature drop, the<br />
State produced no competent evidence that the<br />
effect on the menhaden would have been any<br />
different in the absence of pumping.”<br />
“The claim that the State, as Parens patriae or as<br />
public trustee, had established a good cause of<br />
action for money damages must fall . . . because of<br />
the failure to prove proximate cause.”<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
29<br />
The “Mono Lake” case<br />
(California Supreme Court 1983)<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
30<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 16<br />
The “Mono Lake” case<br />
(California Supreme Court 1983)<br />
In 1940, Los Angeles obtained a permit from<br />
California to divert most of the water that flowed into<br />
Mono Lake, near Yosemite National Park.<br />
After decades of water diversion, the level of the<br />
lake dropped and the surface area diminished<br />
significantly.<br />
Though Mono Lake itself was navigable (and<br />
therefore part of the public trust), its tributaries were<br />
not.<br />
The case pitted the water needs of Los Angeles<br />
against the public trust doctrine.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
31<br />
Mono Lake, early 1980s<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
32<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 17<br />
The “Mono Lake” case<br />
(California Supreme Court 1983)<br />
Holding: The public trust doctrine applied to nonnavigable<br />
tributaries of navigable bodies of<br />
water.<br />
The State must exercise “continuous supervision<br />
and control” over the resources in the trust. It<br />
must ensure that no water diversions needlessly<br />
destroy trust values.<br />
Thus, the State may modify or revoke water<br />
rights where necessary to accommodate trust<br />
uses.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
33<br />
The “Mono Lake” case<br />
(California Supreme Court 1983)<br />
Mono Lake is also significant because Los Angeles<br />
had argued that responsibility should be apportioned<br />
among 117 other individuals and entities who<br />
claimed rights to divert water from the tributaries. In<br />
other words, there were multiple diverters (though<br />
Los Angeles was the largest).<br />
But when the case was remanded, the Water Board<br />
specifically rejected an argument that the public trust<br />
limitations had to be enforced against all diverters,<br />
or not at all. The entire burden to restore Mono<br />
Lake was placed on Los Angeles.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
34<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 18<br />
Mono Lake, 2001<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
35<br />
Douglaston Manor v. Bahrakis<br />
(New York Court of Appeals 1997)<br />
Salmon River, upstate New York<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
36<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 19<br />
Douglaston Manor v. Bahrakis<br />
(New York Court of Appeals 1997)<br />
Douglaston Manor, Inc. owned a 1 mile stretch<br />
of both sides of the Salmon River.<br />
Douglaston brought suit against fishing guides<br />
for anchoring along and fishing in its section of<br />
the river. Douglaston argued that its fishing<br />
rights were exclusive.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
37<br />
Douglaston Manor v. Bahrakis<br />
(New York Court of Appeals 1997)<br />
The fishing guides counterclaimed for<br />
interference with their business activities.<br />
The fishing guides argued that because the<br />
Salmon River was navigable, the state<br />
irrevocably held a public trust that protected<br />
anyone’s navigation of the river, which included<br />
a right of public fishery.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
38<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 20<br />
Salmon River, upstate New York<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
39<br />
Douglaston Manor v. Bahrakis<br />
(New York Court of Appeals 1997)<br />
Holding: The court enjoined the actions of the<br />
fishing guides because their activities were not<br />
included as a public use within the trust.<br />
The river was navigable-in-fact, and therefore<br />
navigation was a public use under the trust.<br />
However, the public right to navigate did not<br />
include the public right to fish.<br />
Thus, the fishing guides were trespassing, and<br />
were liable for damages.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
40<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 21<br />
Parker v. Milton<br />
Vermont Supreme Court 1998<br />
Arrowhead Mountain Lake, Milton, Vermont<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
41<br />
Parker v. Milton<br />
Vermont Supreme Court 1998<br />
The town of Milton applied for and received an<br />
encroachment permit from the state of Vermont to<br />
build a bridge across Arrowhead Mountain lake.<br />
Residents of Milton sued the town.<br />
The residents did not claim particularized<br />
damage to their property as a result of the bridge,<br />
but only to the trust as a whole.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
42<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 22<br />
Parker v. Milton<br />
Vermont Supreme Court 1998<br />
The residents argued that because members of<br />
the public are beneficiaries of the public trust in<br />
navigable waters, mere status as a member of<br />
the public should be sufficient to confer standing.<br />
They argued that strict standing requirements<br />
would undermine the ability to enforce the public<br />
trust doctrine.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
43<br />
Arrowhead Mountain Lake, Milton, Vermont<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
44<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 23<br />
Parker v. Milton<br />
Vermont Supreme Court 1998<br />
Holding: the residents lacked standing to bring a<br />
claim under the public trust doctrine.<br />
“Standing is not conferred on individuals merely<br />
by virtue of their status as beneficiaries of the<br />
interest protected by the public trust doctrine.”<br />
The public trust doctrine is not advanced by<br />
permitting litigants without a personalized claim<br />
to proceed.<br />
Although the residents may have legitimate<br />
grievances, their remedy is political, not judicial.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
45<br />
A <strong>Fe</strong>w Concluding Thoughts…<br />
The public trust doctrine – as the jurisprudential<br />
precursor to statutory <strong>NRD</strong> claims – presents<br />
many of the same challenges we face today.<br />
For example, the government must establish<br />
causation and injury from baseline, as in the<br />
New Jersey nuclear power case.<br />
Also, the government often has a difficult time<br />
establishing trusteeship, as in the New York City<br />
and North Dakota cases.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
46<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 24<br />
A <strong>Fe</strong>w Concluding Thoughts…<br />
As with statutory <strong>NRD</strong> claims, private claims not<br />
typically allowed. The Vermont and upstate New York<br />
case show the difficulty applying the public trust<br />
doctrine to non-governmental claimants.<br />
Importantly, courts are more willing to impose<br />
injunctive relief (including restoration), than damages.<br />
For example, in both Gold Run Ditch and Mono Lake,<br />
the courts enjoined a single defendant, even though<br />
multiple defendants contributed to the injury.<br />
On the other hand, almost no pre-statutory cases<br />
awarding damages, as in the North Dakota case.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
47<br />
A <strong>Fe</strong>w Concluding Thoughts…<br />
The cases – whether asserted pursuant to<br />
modern statute or the ancient public trust doctrine<br />
– are fact specific, involving complex evidentiary<br />
and scientific issues.<br />
A review of pre-statutory cases demonstrates that<br />
the relative strength of <strong>NRD</strong> claims will depend<br />
upon the nature of the harm; whether the claimant<br />
is truly a trustee over the resource; the ability of<br />
the government to establish causation and<br />
baseline; and the type of relief sought.<br />
7/15/<strong>2010</strong> Brian D. Israel<br />
48<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5a: 25<br />
Sources, Nature & Relative<br />
Strength of <strong>NRD</strong> Claims<br />
Brian D. Israel<br />
<strong>LSI</strong> Natural Resources Damages Conference<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
July 15, <strong>2010</strong><br />
7/15/<strong>2010</strong> Brian D. Israel<br />
49<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 1<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 3<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 5<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 6<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 7<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 8<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 9<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 11<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 12<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 13<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 14<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 15<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 16<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 17<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 18<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 19<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 20<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 21<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 22<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 23<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 24<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 25<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 26<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 27<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 28<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 29<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 30<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 31<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 32<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 33<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 34<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 35<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 36<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 37<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 38<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 39<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 40<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 41<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 42<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 43<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 44<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 45<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 46<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 47<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 48<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 49<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 50<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 51<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 52<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 53<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 55<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 56<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 57<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 58<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 59<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 60<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Brian D. Israel of Arnold & Porter LLP Speaker 5b: 61<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Defenses to Claims of Natural Resource Damages<br />
David J. Lazerwitz, Esq.<br />
Farella Braun + Martel LLP<br />
San Francisco, CA
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 1<br />
DEFENDING FEDERAL, STATE AND TRIBAL<br />
NATURAL RESOURCE DAMAGES CLAIMS<br />
David J. Lazerwitz<br />
Farella, Braun + Martel LLP<br />
Law Seminars International – Natural Resource Damages<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico – July <strong>2010</strong><br />
The Defendant’s Perspective<br />
• Presentation overview<br />
• Legal authority for claims<br />
• Focus on CERCLA and common law defenses<br />
• Emerging trends in <strong>NRD</strong> litigation/defenses<br />
• Preliminary thoughts<br />
• Largely fact-intensive<br />
• Wide array of statutory and common law<br />
defenses drawn from other areas<br />
• Emerging area of law allows for creativity<br />
• Focus first on the low hanging fruit<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 2<br />
Legal Authority for <strong>NRD</strong> Claims<br />
• <strong>Fe</strong>deral statutory claims:<br />
• CERCLA: 42 USC 9607(a)(4)(C)<br />
• Clean Water Act: 33 USC 1321(F)(4)<br />
• Oil Pollution Act of 1990: 33 USC 2702(b)(2)(A)<br />
• Marine Protection and Sanctuaries Act: 16 USC 1443<br />
• Park System Resources Protection Act: 16 USC 19jj.<br />
• States may possess independent statutory<br />
authority<br />
• States/Tribes may also file common law claims:<br />
• Public trust doctrine<br />
• Public and private nuisance<br />
• Trespass<br />
• Negligence<br />
3<br />
CERCLA <strong>NRD</strong> Claims<br />
• Elements of a CERCLA <strong>NRD</strong> Claim:<br />
1) There is a “covered person” who is<br />
responsible<br />
2) For a “release”<br />
3) From a “facility”<br />
4) Of a “hazardous substance”<br />
5) Causing incurrence of “response costs”<br />
6) Resulting in “injury to, loss or<br />
destruction”<br />
7) Of a “natural resource” within plaintiff’s<br />
trusteeship.<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 3<br />
Defenses to CERCLA <strong>NRD</strong> Claims<br />
• Defenses provided by or derived from statute<br />
• Standing & indispensable parties<br />
• Issues of proof (causation, injury, baseline)<br />
• Restriction on the use of damages<br />
• Statute of limitations<br />
• Pre-enactment contamination (pre-1980)<br />
• Impermissible attack on the remedy<br />
• Acts of god, war, act/omission of third-party<br />
• <strong>Fe</strong>derally permitted release<br />
• Defenses specific to common law claims<br />
• Conflict preemption<br />
• Procedural issues<br />
• Third party contribution<br />
5<br />
Standing to Bring an <strong>NRD</strong> Claim<br />
• “Natural resources” definition:<br />
• “land, fish, wildlife, biota, air, water, ground water, drinking<br />
water supplies, and other such resources belonging to,<br />
managed by, held in trust by, appertaining to, or<br />
otherwise controlled by the United States…, any State<br />
or local government or Indian tribe, or any foreign<br />
government…” 42 USC 9601(16).<br />
• Two components of standing:<br />
• Must be a designated trustee<br />
• Must have a management or stewardship interest in the<br />
resource<br />
• Exercise “substantial degree” of control – not just use<br />
• Fact intensive inquiry (Coeur d’Alene Tribe)<br />
• Focus on which trustee exercises day-to-day control of the<br />
relevant resources.<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 4<br />
Standing, cont.<br />
• Standing issues<br />
• Private parties may not recover<br />
• Counties and cities may not recover, except where<br />
designated by the Governor<br />
• Overlapping trusteeship/co-trustees – no “double<br />
recovery”<br />
• Initial approach in Couer d’Alene to require each trustee to<br />
submit evidence for court to determine damages in the<br />
ratio or percentage of actual management or control<br />
• Later approach in US v. ASARCO deemed plaintiffs, as a<br />
whole, as trustees over resources; thereby leaving it to the<br />
trustees to work out allocation among themselves<br />
• Tribal standing/resources<br />
• Cultural use of natural resources? (Couer d’Alene)<br />
• Look to treaty rights/doctrines<br />
7<br />
Standing, cont.<br />
• Failure to join indispensable party<br />
• Are all necessary trustees in the action?<br />
• Traditional FRCP 19 “required party” analysis<br />
• Oklahoma v. Tyson Foods<br />
• State action over Illinois River watershed<br />
• Motion to dismiss for failure to join Cherokee Nation<br />
• Ruling:<br />
• State didn’t follow required claim assignment process<br />
• Nation had a direct interest in the watershed resources<br />
• Absence would impair or impede Nation’s ability to protect<br />
its interest and subject defendants to risk of incurring<br />
double or inconsistent obligations<br />
• State possessed adequate remedy if dismissed by refiling<br />
and/or proceeding on injunctive relief claims<br />
258 FRD 472 (N.D. Okla. 2009)<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 5<br />
Issues of Proof and Causation<br />
• Trustee bears the burden of proof<br />
• Can trustee show “injury or loss” of resources?<br />
• DOI definition of injury: “a measurable adverse change, either<br />
long- or short-term, in the chemical or physical quality or the<br />
viability of a natural resource . . .” 43 CFR 11.14(v)<br />
• Can be shown by either (1) empirical evidence of adverse<br />
change in a particular case; or (2) reliance on a prior<br />
regulatory determination (e.g., water quality standards)<br />
• Examples: population decline, FDA “tolerance level” for<br />
consumption, MCLs under SDWA<br />
• Can an environmental baseline be established?<br />
• Only entitled to damages “resulting from” release<br />
• Condition of ecological services “but for” the release; not<br />
pristine conditions but actual, pre-release conditions<br />
9<br />
Issues of Proof and Causation, cont.<br />
• Can causation be established?<br />
• Whether the injury was caused, in whole or part, by the<br />
defendant’s release<br />
• Level of proof unresolved:<br />
• Release was the “sole or substantially contributing cause of the<br />
injury” (Montrose)<br />
• Other courts have allowed lesser “contributing factor” standard,<br />
particularly in co-mingling cases<br />
• “More than a de minimus amount” – such that some injury<br />
would have occurred if only defendant’s release had occurred.<br />
(Couer)<br />
• Can the injury be quantified?<br />
• Admissibility of evidence per FRE 702/Daubert (or Frye)<br />
• Scientific testimony must be based on reasoning or<br />
methodology that is scientifically valid and can properly be<br />
applied to the facts at issue.<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 6<br />
Damages Considerations<br />
• Quantifying damages<br />
• Lost value of the resource: difference between<br />
baseline and present condition<br />
• Lost interim use during remediation<br />
• Assessment costs<br />
• Limitation on the use of damages<br />
• Recovery must be used only to restore, replace or<br />
acquire the equivalents of the damaged resources<br />
(9607(f)(1))<br />
• No punitive damages (Ohio v. DOI)<br />
• Open question on attorneys fees<br />
• What about resource-related projects such as<br />
education facilities, community centers, parking and<br />
access areas?<br />
11<br />
Statute of Limitations<br />
• CERCLA Section 9613(g)<br />
• Non-NPL sites: 3 years from the later of:<br />
• The date of discovery of loss and its connection with the<br />
release; or<br />
• The date of promulgation of CERCLA regulations (3/20/87)<br />
• Discovery rule: fact question based on trustee’s knowledge<br />
• NPL sites: 3 years from completion of the remedy<br />
(excluding operation and maintenance activities)<br />
• What constitutes “completion” of the remedy?<br />
• Final installation of equipment, approval/permitting or<br />
actual completion of remedial activities?<br />
• Expanding original NPL site beyond initial boundary to<br />
encompass former non-NPL areas (US v. Asarco)<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 7<br />
Statute of Limitations, cont.<br />
• Tribal claims – CERCLA Section 9626(d)<br />
• Action must be commenced by the later of:<br />
• Expiration of the applicable limitations period in<br />
9613(g)(1); or<br />
• 2 years after the US gives written notice to tribe that it<br />
will not present a claim within the applicable period<br />
• Provides tribes with an additional 2 years beyond<br />
period applicable to federal trustees in most cases<br />
• State claims<br />
• Claims brought pursuant to state law are controlled<br />
by the application limitations period<br />
• States have amended their limitations period to<br />
allow greater time to pursue claims (e.g., NJ)<br />
13<br />
Ripeness – Timing Window<br />
• CERCLA <strong>NRD</strong> claims may not be filed:<br />
• Prior to 60 days after the trustee provides to the US<br />
and PRP a notice of intent to file suit; or<br />
• Where US EPA is “diligently proceeding” with a<br />
Remedial Investigation/<strong>Fe</strong>asibility Study, the<br />
trustees cannot pursue <strong>NRD</strong> claims until selection of<br />
the <strong>final</strong> remedy (9613(g)(1))<br />
• Establishes “window” of time within which<br />
federal trustees can bring <strong>NRD</strong> claims:<br />
• Opening the window: Selection of the remedy via<br />
Record of Decision<br />
• Closing the window: 3 years after “completion”<br />
• States/tribes are not similarly limited<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 8<br />
Pre-Enactment Releases/Damages<br />
• CERCLA precludes pre-enactment damages<br />
• Recovery precluded where “damages and the release<br />
of a hazardous substance from which such damages<br />
resulted occurred wholly before December 11, 1980”<br />
(9607(f)(1))<br />
• Mixed case law interpretation<br />
• Cessation of operations/emissions precluded liability<br />
(Montana v. ARCO)<br />
• Post-operational “re-releases” due to passive migration<br />
(Couer d’Alene)<br />
• Divisibility of pre- and post-1980 releases<br />
• Monetary quantification of damages<br />
• Is it enough? (In re Acushnet)<br />
15<br />
Impermissible Attack on Remedy<br />
• CERCLA Section 9613(h)<br />
• Prevents challenges to the design or extent of response<br />
activities until the response action is complete or one of<br />
several narrow exceptions apply<br />
• Two evolving approaches:<br />
• Whether the action seeks relief directly attacking the<br />
response action or order (Ninth and Eight Circuits)<br />
• Whether the action would have the effect of impeding or<br />
interfering with the goals of the cleanup (Tenth Circuit)<br />
• Exceptions:<br />
• Recovery of response costs or contribution claims<br />
• Enforcement of existing administrative orders<br />
• Collection of administrative penalties<br />
• Claim that response action violates CERCLA<br />
• Action by US to compel a remedial action<br />
16<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 9<br />
Additional Statutory Defenses<br />
• <strong>Fe</strong>derally permitted release (9607(j))<br />
• Defined as a discharge pursuant to a permit issued under<br />
11 permit categories (e.g., CWA, CAA, RCRA)<br />
• Excludes discharge exceedances (Idaho v. Bunker Hill)<br />
• Commingled discharges (In re Acushnet)<br />
• Identified irreversible and irretrievable<br />
commitment of resources (9607(f)(1))<br />
• Damages specifically identified as an “irreversible and<br />
irretrievable commitment of resources” in an EIS (Hanna)<br />
• Act of God, act of war, act or omission of third<br />
party (9607(b))<br />
• Statutory cap on damages of $50M per release<br />
(9607(c)(1)(D))<br />
• No double recovery (9607(f)(1))<br />
17<br />
Right of Third-Party Contribution<br />
• Derived from CERCLA<br />
• Section 107(a)(4)(C) – trustee cause of action<br />
• Section 113(f) – potentially liable party under 107 (a)<br />
possesses right of contribution “during or following”<br />
action from any other liable or potentially liable party<br />
• Unaffected by Aviall and Atlantic Research<br />
• Procedural issues<br />
• Three year statute of limitations (9613(g)(3))<br />
• FRCP impleader and consolidation vs. severance<br />
• Defendant have burden to show divisibility or<br />
reasonable basis for apportionment (Monsanto)<br />
• State equivalents<br />
• Derived from statute or common law<br />
18<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 10<br />
Defenses to Common Law Claims<br />
• Conflict preemption<br />
• Where it is (1) impossible to comply with both federal and<br />
state law; (2) or where state law stands as an obstacle to<br />
congressional objectives, state law claims are barred<br />
• Savings clauses do not apply to preserve claims<br />
• Potential conflicts may exist with:<br />
• Objective of the CERCLA <strong>NRD</strong> scheme<br />
• Methodology of CERCLA <strong>NRD</strong> scheme<br />
• Equitable defenses?<br />
• Generally prohibited under CERCLA – defenses must be<br />
found in the statute – but not common law (e.g., mitigation<br />
of damages, estoppel)<br />
19<br />
New Mexico v. General Electric, et al.<br />
• Historically contaminated aquifer (VOCs)<br />
• NPL designation in 1983<br />
• Response action required pump/treat to MCLs<br />
• Replacement public supply well<br />
• <strong>NRD</strong> and common law actions filed in 1999<br />
• Initial damages theories based on lost tax revenues,<br />
diminished property values, cost to construct surface<br />
reservoir (+/- $4 billion)<br />
• Issues:<br />
• What is the State’s interest in groundwater and aquifer?<br />
• Can the State could show injury/harm to the resource?<br />
• What is the measure of damages to compensate the injury?<br />
20<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 11<br />
New Mexico v. General Electric, et al.<br />
• Tenth Circuit Decision:<br />
• State could not demonstrate injury or damages:<br />
• State’s public trust interest is in providing groundwater for<br />
beneficial use and there was no evidence that anyone had<br />
incurred any lost use of groundwater -- no interest in aquifer itself<br />
• Remediation met EPA MCLs which were adopted by New Mexico<br />
• State’s damages for alleged inadequate remediation of<br />
groundwater seeks monetary compensation in violation of<br />
CERCLA’s restoration, replacement or acquistion goals and<br />
preempted by federal law (or, alternatively, violates 9613(h))<br />
• Common law claims that survive:<br />
• Claims seeking restoration/replacement/acquisition<br />
damages<br />
• Claims filed where proprietary ownership interest<br />
• Interim loss of use damages, while permissible, require proof of<br />
actual loss of services<br />
467 F.3d 1223 (10th Cir. 2006)<br />
21<br />
Quapaw Tribe v. Blue Tee Corp.<br />
• State common law claims<br />
• Tribe amended complaint to drop CERCLA claims<br />
following adverse 2008 ruling regarding timing of action in<br />
light of EPA remedy selection<br />
• Qualification on conflict preemption defense<br />
• “CERCLA does not completely preempt state law claims,<br />
but CERCLA impacts the availability of natural resource<br />
damages under state law”<br />
• Allowed common law causes of action to proceed:<br />
• Tribe tailored relief to be co-extensive with CERCLA<br />
• No direct interference with EPA remedial selection/order<br />
• Damages both before and after December 11, 1980<br />
• Potential to factually develop conflict argument<br />
2009 WL 455260 (N. D. Okla. <strong>Fe</strong>b. 23, 2009)<br />
22<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
David J. Lazerwitz of Farella Braun + Martel LLP Speaker 6: 12<br />
Emerging Trends in Litigation<br />
• Damages/resource focus<br />
• Evolution of claims from focus on the resource itself to<br />
resource attributes/services, including lost use<br />
• States/Tribes on the leading edge<br />
• Use of private/special attorneys general on contingency<br />
• Common law/state statutory claims to avoid<br />
statutory defenses<br />
• Nuisance/trespass/negligence<br />
• State <strong>NRD</strong> statutes<br />
• Narrowly tailored relief to avoid conflict preemption<br />
• Trustee coordination as a result of Tyson?<br />
• Defendants need to be equally creative in<br />
responding to common law claims<br />
23<br />
Questions?<br />
David Lazerwitz<br />
Farella Braun + Martel LLP<br />
dlazerwitz@fbm.com<br />
415.954.4980<br />
24<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Cooperative <strong>NRD</strong>As: Fact or Fiction<br />
Richard O. Curley, Jr., Esq.<br />
Curley & Associates LLC<br />
Golden, CO<br />
Andrew O. Guglielmi, Esq.<br />
New York State Department of Environmental Conservation<br />
Albany, NY<br />
Kenneth Jenkins, Ph.D.<br />
ARCADIS<br />
Petaluma, CA<br />
Amy L. Horner, Esq.<br />
U.S. Department of the Interior<br />
Washington, DC
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 7: 1<br />
<br />
COOPERATIVE<strong>NRD</strong>AS:FACTORFICTION?<br />
APRPCOUNSEL’SPERSPECTIVE<br />
ByRichardO.Curley,Jr.<br />
Cleaningupcontaminantsreleasedintotheenvironment,assessing<br />
impacts,andrestoringinjuredresourcesarebestachievedthrougha<br />
cooperative,integratedapproach.<br />
NOAADamageAssessment,Remediationand<br />
RestorationProgramFactSheet,May2007atp.1<br />
<br />
Idon’tsitaroundjusttalkingtoexpertsbecausethisisacollegeseminar.<br />
WetalktothesefolksbecausetheypotentiallyhavethebestanswersoI<br />
knowwhoseasstokick.<br />
PresidentBarackObama<br />
InterviewwithMattLauer,June7,<strong>2010</strong><br />
<br />
OurjobbasicallyistokeepthebootontheneckofBritishPetroleumto<br />
carryouttheresponsibilitiestheyhavebothunderthelawand<br />
contractuallytomoveforwardandstopthisspill.<br />
SecretaryoftheInterior,KennethSalazar<br />
CNN’sStateoftheUnion,May2,<strong>2010</strong><br />
<br />
Manypotentiallyresponsibleparties(PRPs)havelongwonderedwhetherthe<br />
cooperationpartofcooperativeassessmentsisaonewaystreetinwhichthePRP(s)paysome<br />
orallofthetrustee(s)naturalresourcedamageassessment(“<strong>NRD</strong>A”)costsandthetrustees<br />
proceedtoconducttheir<strong>NRD</strong>AwithlittlemeaningfulroleforthePRPs.PresidentObama’sand<br />
SecretarySalazar’sremarksquotedabovesuggestthatsuchPRPskepticismhasbeenwarranted<br />
astheUnitedStates’commitmenttocooperative<strong>NRD</strong>Asappearstobelimitedbypolitical<br />
expediencywhencooperationisarguablyneededmost.Somemaysaythatitisnot<br />
appropriatetocriticizethePresidentorothertrusteesfortheirpolemic,noncooperative<br />
rhetoricregardingtheDeepwaterHorizonmatterasitisauniqueandtragicsituation.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 7: 2<br />
However,thatignoresthepointthatitisintheeventofsuchlargespillsorreleases,when<br />
passionsflare,thatacooperativeassessmentwithoutbullyingfrompoliticiansismostneeded.<br />
Evenifitistruethatthesituationsarefewandfarbetweeninwhichpoliticalfactors<br />
overrideormasktrustees’supportforthecooperativeassessmentapproach,PRPsarestill<br />
facedwiththelongstandingquestionofwhether“cooperation”beginsandendswiththePRPs<br />
writingachecktofundapartorallofthetrustee(s)’<strong>NRD</strong>A.Toensurethatthereismeatonthe<br />
bonesofacooperativeassessment,PRPsmustensurethattheyhaveanagreementwith<br />
trusteesthatlinksPRPfundingofthetrustees’<strong>NRD</strong>Atorealcooperationonthepartofthe<br />
trustees.SuchcooperationincludesmeaningfulPRPparticipationinthedesign,<br />
implementationandinterpretationof<strong>NRD</strong>Astudies.Inordertoensurethattrustee<br />
cooperationcontinuesbeyondtheinitialstagesofassessment,PRPsshouldmakecooperative<br />
assessmentpaymentsonaninstallmentbasiscontingentupontheassessmentprogressingina<br />
cooperativemannerratherthanpayingtheentireprojectedcostoftheassessmentupfront.<br />
Many,ifnotmost,trusteesunderstandtheneedforPRPstoinsistonsuchprovisionsandalso<br />
understandtheneedtoletbothPRPsortrusteesterminatecooperativeassessment<br />
agreementsatwill(subjecttoreasonablenoticeandcompletion/fundingofworkthathas<br />
alreadybeeninitiatedonacooperativebasis).PRPsshouldbewaryofenteringintoany<br />
cooperativeassessmentagreementthatdoesnotallowanyofthepartiestoterminatethe<br />
agreementattheirsolediscretion.<br />
<br />
MISSINGTHEBOATVS.THECARTBEFORETHEHORSE<br />
<strong>NRD</strong>practitionersneedtobemindfulofthefactthattheappropriatetimingof<br />
cooperativeassessmentsmayvarygreatlydependinguponwhetheroneisdealingwithanoil<br />
spillunderOPA(ortheCleanWaterAct)oralegacysiteunderCERCLA(oranequivalentstate<br />
statute).Inthecaseofmanyoilspills,theneedforandopportunitytoconductacooperative<br />
assessmentarisesalmostimmediatelyupontheoccurrenceofthespillduetotheneedto<br />
collectbaselineinformationandtorecordtheeffectsofthespillandresponseactivitieswhose<br />
durationisusuallymeasuredinweeks,monthsoratmostafewyears.Forthoseandother<br />
reasons,bothPRPsandtrusteesoftenmoveveryquicklytoagreeoninitialcooperativesteps<br />
includingcoordinationofdatacollectionandinitialPRPfundingsoastopreservethe<br />
advantagesforallpartiesofinitiatingcoordinatedandcooperativeeffortsearlyoninthe<br />
processofspillresponseandnaturalresourcedamageassessment.<br />
Conversely,inthecaseofmanynaturalresourcedamagesassessmentsforsites<br />
regulatedunderCERCLAandsimilarstatelaws,speedinenteringintoacooperativeassessment<br />
maynotjustbeunnecessary,itmaybecounterproductive.Movingquicklytoenterintoa<br />
COOPERATIVE<strong>NRD</strong>AS:FACTORFICTION?<br />
Page2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 7: 3<br />
cooperativeassessmentintheCERCLAcontextisoftenunnecessarybecauseoftheslow<br />
(sometimesglaciallyslow)paceofsitecharacterizationandsiteremediationactivities.<br />
Likewise,determiningbaselineatmostCERCLAsitesisusuallyacomplex,timeconsuming<br />
undertakinginvolvingnotjustcurrentsamplingofnaturalresources,butthecompilationof<br />
historicandenvironmentalinformationcoveringprioryearsorevendecadesofanthropogenic<br />
andnaturalevents.Suchbaselineworkshouldnotberushedorgivenshortshriftforthesake<br />
ofexpeditingacooperativeprocess.Giventhatrestorationdamagesarerecoverableforonly<br />
theresidualinjuriesexistingafterthecompletionofremediation(andanynaturalrecovery)<br />
rushingintoacooperativeassessmentyearsorevendecadesbeforeaCERCLAremedyhas<br />
beenimplementedoftenisnotonlyunnecessarybutcounterproductive.Moreover,bothPRPs<br />
andtrusteesshouldcarefullyconsiderthetimingofacooperative<strong>NRD</strong>AatanyCERCLAsite<br />
wheretheRI/FShasnotyetbeencompleted.Section113(g)ofCERCLAprovidesthat:<br />
Innoeventmayanactionfordamagesunderthischapterwithrespecttosucha<br />
vesselorfacilitybecommenced(i)priorto60daysafterthe<strong>Fe</strong>deralorState<br />
naturalresourcetrusteeprovidestothePresidentandthepotentially<br />
responsiblepartyanoticeofintenttofilesuit,or(ii)beforeselectionofthe<br />
remedialactionifthePresidentisdiligentlyproceedingwitharemedial<br />
investigationandfeasibilitystudyundersection9604(b)ofthistitleorsection<br />
9620ofthistitle(relatingto<strong>Fe</strong>deralfacilities).[Emphasisadded.]<br />
Conductingan<strong>NRD</strong>A–evenacooperativeone–monthsoryearsbeforeaclaimmaybe<br />
broughtwillusuallynotmakesenseforbothpracticalandstrategicreasons.<br />
<br />
RELATIONSHIPSAMONGCOOPERATIVEASSESSMENTS,SETTLEMENTNEGOTIATIONSANDLITIGATION<br />
PRPsandtrusteesshouldalsogivecarefulconsiderationtowhetheracommitmentto<br />
conductsomeorallofan<strong>NRD</strong>Acooperativelynecessarilymeansthattheyandtheother<br />
partiestothecooperative<strong>NRD</strong>Awillresolvethetrustees’claims(andanycounterclaimsor<br />
thirdpartyclaims)viasettlementnegotiations.Althoughconductingsomeorallofthe<strong>NRD</strong>A<br />
cooperativelywillhopefullyprovideasolidbaseforinitiatingsettlementnegotiations,all<br />
partiestoacooperative<strong>NRD</strong>Ashouldbemindfulthatinitiatingorevencompletinga<br />
cooperative<strong>NRD</strong>Adoesnotmeanthattheyortheotherpartiestothecooperative<strong>NRD</strong>Awill<br />
allwanttopursuesettlementnegotiationsratherthanlitigation.Infact,itispossiblethatifthe<br />
cooperative<strong>NRD</strong>Aisnotsocooperativeorsuccessful,thenoneormorepartiesmaycometo<br />
believethatresolutionofthetrustees’claimsthroughsettlementnegotiationsisnotlikelyto<br />
succeedandthatatleastaperiodoflitigationisnecessary.Theauthorisnotawareofany<br />
publiclyavailabledataastohowoftenthismayresult,thoughitwouldseemtobean<br />
COOPERATIVE<strong>NRD</strong>AS:FACTORFICTION?<br />
Page3<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Richard O. Curley, Jr. of Curley & Associates LLC Speaker 7: 4<br />
uncommonoccurrencefromanecdotalaccounts.However,itisstillsomethingworthgiving<br />
carefulconsiderationtobeforeenteringintoacooperativeassessmentagreement.<br />
PRPsshouldalsogiveseriousconsiderationtowhetherthebenefitstheyarelikelyto<br />
obtainfromaparticularcooperative<strong>NRD</strong>Aaresufficienttojustifytheassessmentcoststhey<br />
willberequiredtopayunderthatcooperativeassessmentagreement.Giventheveryreal<br />
fundingconstraintsmosttrusteesface,aPRP’sagreementtofundpartorallofacooperative<br />
<strong>NRD</strong>Amay:(1)acceleratethetimingofthetrustee’sclaims,(2)improvethequalityofthe<br />
trustee’s<strong>NRD</strong>A,and/or(3)allowthetrusteetobringclaimsforalargernumberofsitesthanit<br />
otherwisecouldhavewithoutsuchcooperativefunding.BeforeaPRPactsinawaythat<br />
confersoneormoreofthesebenefitsuponthetrustee(s)thathasindicatedadesiretoasserta<br />
claimagainstit,thePRPshouldconsiderwhetheritisreceivingsufficientbenefitsinexchange.<br />
<br />
ISACOOPERATIVE<strong>NRD</strong>AALWAYSBETTER?<br />
Tosomeitmayseemlikeblasphemy,butbothPRPsandtrusteesshouldconsiderin<br />
eachinstancewhether,whollyapartfromfundingconsiderations,acooperative<strong>NRD</strong>Aislikely<br />
tobethebestapproach.Forinstance,iftherearefundamentalandstronglyhelddifferencesof<br />
opinionamongthePRP(s)andtrustee(s)relatingtothenatureand/orextentofinjuryorwith<br />
respecttohowtomeasuredamages,attemptingtoengageinacooperative<strong>NRD</strong>Amaynotbe<br />
advisable.Insuchsituations,ratherthanengageina“cooperative”processinwhichthe<br />
partiesclash,itmaymakemoresenseforthepartiestoconducttheirownstudiesandshare<br />
theresultsofthosestudiesatsomefuturedate.Theresultsofsuchcompetingstudies<br />
ultimatelymaydomoretotestandresolvethepartiesdifferingpositionsthanapremature<br />
and/orforcedattemptatcooperation.<br />
<br />
COOPERATIVEASSESSMENTRESOURCES<br />
<br />
Thefollowingsourcescontainusefulinformationconcerningcooperativeassessments:<br />
http://www.darrp.noaa.gov/partner/cap/index.html<br />
http://www.darrp.noaa.gov/partner/cap/relate.html<br />
http://www.nrdarpracticeexchange.com/documents/cooperative<br />
COOPERATIVE<strong>NRD</strong>AS:FACTORFICTION?<br />
Page4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 1<br />
Cooperative <strong>NRD</strong> Assessments:<br />
An Uneasy Marriage<br />
Andrew O. Guglielmi<br />
NYS Department of Environmental Conservation 1<br />
I. Introduction<br />
What are the attributes of a long and successful marriage? Several come to mind:<br />
honesty, trust, open communication, ability to relate to and understand your partner’s feelings,<br />
patience. Now, what are the attributes of a young or shaky marriage? Some are: a need for<br />
control, insecurity, stubbornness, deceit, indifference.<br />
What does marriage have with to do with cooperative assessment agreements? In my<br />
mind, cooperative agreements are a lot like a marriage. They are voluntary, usually both sides<br />
have no idea what they are getting into when they sign on, they are messy when one side wants<br />
them to end, and they involve hard work on both sides to be successful.<br />
Cooperative assessments are something unique. As much as natural resource trustees<br />
(“Trustees”) – the United States, States and Indian tribes – would like to think of themselves as<br />
environmental enforcers, Natural Resource Damage (“<strong>NRD</strong>”) practice is not enforcement. It is a<br />
process to compensate the public under the polluter pays principle, but it is not a process to<br />
penalize polluters and deter future conduct (although it might have that unintended<br />
consequence). When Trustees enter cooperative agreements with Potentially Responsible Parties<br />
(“PRPs”), they should acknowledge that they are giving up some things – full control over the<br />
1 Mr. Guglielmi is a Senior Attorney in the Office of General Counsel of the New York State Department of<br />
Environmental Conservation (DEC). The statements and opinions expressed herein are the author’s alone and do not<br />
necessarily represent policies or positions of New York State or the DEC.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
1
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 2<br />
assessment process in order to expedite restoration, the opportunity to bash a PRP in public or in<br />
court, and the ability to achieve their best case scenario in litigation.<br />
PRPs also have to recognize what they give up when they enter cooperative assessments<br />
with Trustees. Although PRPs would never formally waive their right to litigate on liability and<br />
defenses, by entering into a cooperative agreement, and by agreeing to pay certain past and<br />
future assessment costs, PRPs have acknowledged that they have some amount of <strong>NRD</strong> liability<br />
at a given site. Subsequently arguing liability and defenses within the cooperative assessment<br />
process serves no positive purpose. If PRPs wants to argue liability and defenses they should not<br />
enter a cooperative process and wait for litigation.<br />
Trustees have to surrender their desire to get the moon and PRPs have to admit they are<br />
not getting out of the process without doing or paying anything. Just like any marriage, you have<br />
to compromise and you don’t always get what you want.<br />
II.<br />
The Courtship – Starting a Cooperative Assessment Process<br />
The mechanism that most often commences a cooperative assessment process is not<br />
romantic. Normally, for CERCLA hazardous waste sites, it is the Trustees’ mailing of a notice of<br />
intent to perform an <strong>NRD</strong> assessment, which typically encloses the Trustees’ Preassessment<br />
Screen Determination that an assessment at a site is warranted. See 43 C.F.R. Part 11. For oil<br />
spills subject to OPA, the coordination with responsible parties is envisioned from the onset of<br />
an oil spill that has <strong>NRD</strong> implications. In fact, if Trustees elect to follow OPA regulations, they<br />
are required to invite PRPs to participate in the assessment. See 15 C.F.R. § 990.14.<br />
There are countless types of cooperative assessments and countless ways in which they<br />
can be structured, from a formal cooperative assessment agreement which covers such topics as<br />
funding, confidentiality, information sharing, and tolling provisions, to a letter or stipulation<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
2
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 3<br />
which simply states that PRPs will pay for portions of the assessment. Additionally, the scope of<br />
a cooperative assessment can vary greatly, from an agreement that covers assessment planning<br />
through restoration implementation, or an agreement that covers the performance one distinct<br />
assessment study cooperatively.<br />
To the extent that Trustees and PRPs can have a meeting of the minds on threshold<br />
questions, or at least a general path towards the assessment and ultimate resolution of a case,<br />
before they decide to enter into a cooperative assessment process, the smoother and more<br />
successful the process will be. For example, is there a need or desire to perform site specific<br />
injury studies or do both parties agree that literature data or data from similar sites can be used to<br />
help quantify injuries? Is there a preference for a settlement that is based on cash or restoration<br />
projects? Are both parties willing to live with some uncertainty? Is there agreement on a rough<br />
timeline for resolution of the case?<br />
The lack of communication on essential issues between some couples before they get<br />
married can be shocking. Some never discuss whether or not they want children, whether or not<br />
they want joint or separate banking accounts, or how they want to go about dividing up<br />
housework and chores. Failure to discuss these threshold issues ahead of time can lead to<br />
arguments, and maybe even divorce.<br />
III.<br />
Newlyweds – Baggage and a Battle for Control<br />
So after months (or years) of hard work and negotiation, you have <strong>final</strong>ized the terms of<br />
your cooperative assessment agreement and are <strong>final</strong>ly ready to move into the assessment and<br />
restoration planning phases. Like a marriage, it is time for the real work to begin.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
3
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 4<br />
Trustees and PRPs both bring baggage into cooperative assessments. This baggage is,<br />
unsurprisingly, almost never disclosed and rarely apparent to the other side before the<br />
cooperative agreement process starts.<br />
Trustees’ usual baggage is a lack of internal coordination and agreement on various<br />
aspects of an <strong>NRD</strong> assessment. <strong>Fe</strong>deral Trustees, State Trustees, and Native American tribes are<br />
going to have different priorities based on their trusteeship interests in particular resources and<br />
services. Trustees are often worried about PRPs discovering these differences, exploiting them,<br />
and driving a wedge between the Trustees. The result is that Trustees are hesitant to discuss<br />
issues openly with PRPs in a cooperative assessment context, unless they have come to<br />
consensus ahead of time. This can lead to a discussion of watered-down and superficial issues<br />
that fails to help the assessment to substantively progress.<br />
In my opinion, Trustees should not be afraid to discuss issues openly with PRPs in a<br />
cooperative assessment process. Trustees might spend hours of hard work and negotiation to<br />
come to consensus internally on something a PRP might have no interest in supporting.<br />
Alternatively, open discussions with PRPs might yield creative ideas that the Trustees would not<br />
consider in their internal deliberations.<br />
PRPs also bring baggage into the cooperative assessment process. Depending on the<br />
sophistication of the PRP, they might have little knowledge or experience with <strong>NRD</strong>. They will<br />
then need to look to outside counsel and outside consultants for advice on to approach an <strong>NRD</strong><br />
claim. Unless outside counsel and consultants are experienced <strong>NRD</strong> practitioners and committed<br />
to the benefits of the cooperative assessment process, there is a risk that they will want to show<br />
their clients that they can challenge Trustees. This will obviously disturb the cooperative process.<br />
Larger, more experienced PRPs might have in-house counsel and managers familiar with <strong>NRD</strong>,<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
4
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 5<br />
and these individuals might be more committed to a cooperative assessment process that moves<br />
towards settlement, based on potential savings in litigation and consultant fees.<br />
If PRPs sign on to a cooperative process, they should truly intend to cooperate and not<br />
use the process as a means to get early discovery. PRPs also should refrain from a cooperative<br />
assessment process if they are going to inherently distrust the Trustees and their valuation<br />
methodologies. Clearly, Trustees and PRPs are going to disagree about the scope of injury at<br />
sites and will disagree as to the best methodologies to employ to value these injuries. However,<br />
PRPs need to believe that Trustees are not out to single them out or get them to pay more than<br />
the restoration of resources and their services are worth.<br />
The way that both Trustees and PRPs deal with their baggage, distrust, and insecurity is<br />
to attempt to wield full control over the cooperative assessment process. This is actually<br />
detrimental to the process and could preclude settlement of the claim. Everyone should accept<br />
that Trustees are statutorily responsible for the assessment and restoration of injured resources<br />
and services. Trustees have the <strong>final</strong> say over every aspect of the assessment. It is in the best<br />
interests for PRPs to acknowledge this fact, both internally and publicly. In the recent Gulf Oil<br />
Spill Disaster, the public and media have become increasingly angry over the perception that BP<br />
is controlling the clean up and response efforts. This makes government agencies look weak and<br />
creates even more public distrust of BP. Neither party benefits from even the appearance that the<br />
PRP is controlling the process.<br />
If Trustees have the <strong>final</strong> say over the assessment and both parties recognize that fact,<br />
then Trustees should be willing to let PRPs take the lead on certain aspects of the assessment,<br />
such as PRPs performing their own studies with their own consultants. Some Trustees are<br />
hesitant to do this, because of a fear that the PRPs and their consultants will “spin” the results to<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
5
Andrew O. Guglielmi of New York State Department of Environmental Conservation Speaker 8: 6<br />
show little or no injury or loss. Some Trustees might be hesitant to let PRPs take the lead on<br />
some aspects of the assessment because it looks like an abrogation of their Trustee<br />
responsibilities.<br />
Well, what does it mean to truly cooperate? If Trustees have the <strong>final</strong> say over the<br />
assessment, they should be willing to let PRPs take the lead on certain elements. Trustees can, in<br />
the end, reject a study or its results if the PRPs did not approach the study objectively.<br />
IV.<br />
Conclusion - Uneasily Married<br />
If Trustees and PRPs are able to shed their baggage, give up some control over the<br />
process, and speak openly and freely without fear of negative consequences, then over time the<br />
parties can maintain an uneasy marriage. There will still be fights and rarely will both sides agree<br />
on any one topic. However, there should also be compromises and mini-successes along the way.<br />
Hopefully the marriage will not last too long, so that restoration of injured resources and<br />
services can be achieved and both Trustees and PRPs can feel like they have successfully<br />
compensated the public for its losses.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM<br />
6
Kenneth Jenkins of ARCADIS Speaker 9: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Kenneth Jenkins of ARCADIS Speaker 9: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Amy L. Horner of U.S. Department of the Interior Speaker 10: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Amy L. Horner of U.S. Department of the Interior Speaker 10: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
What's Next in <strong>NRD</strong><br />
Assessment/Litigation/Settlement?<br />
Ira Gottlieb, Esq.<br />
McCarter & English, LLP<br />
Newark, NJ
Ira Gottlieb of McCarter & English, LLP Speaker 11: 1<br />
WHAT’S NEXT IN <strong>NRD</strong>?<br />
National Advanced Conference on Natural<br />
Resource Damage Litigation<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
July 15-16, 2009<br />
Ira Gottlieb, Esq.<br />
McCarter & English, LLP<br />
973.639.7984<br />
igottlieb@mccarter.com<br />
The Great Carnac of <strong>NRD</strong> ???<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 2<br />
Overview<br />
• Sites to Watch<br />
• Cooperative Assessments/Litigation<br />
• Climate Change & <strong>NRD</strong><br />
• The Gulf<br />
• The Rise of Private Claims<br />
• Insurance<br />
3<br />
Sites to Watch …<br />
Berry’s Creek<br />
Hackensack Meadowlands<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 3<br />
Sites to Watch …<br />
NJ Surface Water Sites<br />
• Passaic River<br />
2009 CAP By Subgroup<br />
Litigation<br />
• Newark Bay<br />
• Berry’s Creek<br />
• Hackensack Meadowlands<br />
5<br />
Sites to Watch …<br />
Portland Harbor<br />
• 2000 <strong>Fe</strong>deral, State and Tribal Trustees<br />
enter into a MOU with EPA regarding <strong>NRD</strong>A<br />
• 2003/04 efforts for CAP are unsuccessful<br />
• 2006 the EPA Study Area is expanded to a<br />
9 mile reach from River Mile 2 to river<br />
mile 11<br />
• 2008 a group of parties enter initial<br />
phased cooperative assessment with<br />
Trustees<br />
• 2009 CAP delayed among Trustees<br />
• <strong>2010</strong> Phase 2 Pending<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 4<br />
Sites to Watch …<br />
Portland Harbor<br />
Phase 1: Develop Assessment Plan<br />
-- Three early studies<br />
Phase 2: Implement CAP – Then<br />
Early Restoration Settlements<br />
Phase 3: Formal Assessment to<br />
Perfect Trustee Legal claims<br />
Phase 4: Settlement/Litigation<br />
7<br />
Sites to Watch …<br />
Portland Harbor Status<br />
• Overview of Phase 2<br />
<br />
Baseline<br />
Recreational Services<br />
Tribal resources<br />
• Phase 2 will focus on the Willamette River and<br />
Multnomah Channel only<br />
• Trustees will use a combination of Habitat Equivalency<br />
Analysis and Benefits Transfer – Recreational<br />
Services<br />
• Key resources: juvenile salmon, lamprey ammocoetes,<br />
sturgeon, sediment, benthos, pisciverous birds<br />
(osprey/bald eagle), pisciverous mammals (otter/mink),<br />
other fish with advisories and recreational value.<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 5<br />
Sites to Watch …<br />
Portland Harbor<br />
Early Settlements?<br />
• Trustees have identified local, community -<br />
based entities for stewardship of restored sites<br />
• Trustees discussed possible projects with<br />
restoration “bankers” who may facilitate<br />
settlements<br />
Present Stumbling Blocks<br />
• Navigation Claim/Tribal Claims<br />
• Scope of Release<br />
• Timing of ROD/Allocation Issues<br />
9<br />
Cooperative Assessments<br />
To Be or Not to Be . . .?<br />
Possible Pros:<br />
• PRP’s Seat at the Table<br />
• Input on Assessment Activities<br />
• Parallel Tracking Response Actions and <strong>NRD</strong>A<br />
• Reduce Costs of Assessment Activities<br />
• Early Restoration Based Settlements<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 6<br />
Cooperative Assessments<br />
To Be or Not to Be . . .?<br />
Possible Cons:<br />
• Limited Input in Actual Assessment<br />
• PRP Funding may Lead to More Studies/Less Cost<br />
Savings<br />
• CAP may not be Based on Statutory or Regulatory<br />
Methodologies<br />
• Extra/Duplicative Costs<br />
• Unintended Admissions in Potential Litigation<br />
11<br />
Climate Change and <strong>NRD</strong> … ?<br />
Definition of Natural Resources<br />
Under CERCLA<br />
“ land, fish, wildlife biota, air, water, ground<br />
water, drinking water supplies, and other<br />
such resources belonging to, managed by,<br />
held in trust by, appertaining to, or otherwise<br />
controlled by the United States, . . . any State<br />
or local government, any foreign<br />
government, any Indian tribe, or, if such<br />
resources are subject to a trust restriction on<br />
alienation, any member of an Indian tribe.”<br />
42 U.S.C § 9601 (16)<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 7<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>NRD</strong> Claims Under CERCLA Must Be :<br />
• Brought by a trustee<br />
• Against a responsible party<br />
• For an alleged injury to natural resources<br />
• Resulting from a release of a “hazardous substance” which is<br />
<br />
<br />
causally related to<br />
damages to the natural resource<br />
Do Climate Change Lawsuits Meet These Standards?<br />
13<br />
Climate Change and <strong>NRD</strong> …?<br />
Cases<br />
Climate Change Lawsuits (2004 to <strong>2010</strong>)<br />
• Connecticut v. American Electric Power Co., Docket No. 1:04-CV-05669<br />
(S.D.N.Y. July 21, 2004). State governments and environmental groups<br />
seeking injunctive relief against utilities under theories of public nuisance.<br />
• CA ex rel. Lockyer v. General Motors, Docket No. 06-CV-05755 (N.D. Cal.<br />
Sept. 20, 2006). State government sought damages against automobile<br />
manufacturers under theories of public nuisance.<br />
• Comer v. Nationwide Mutual Ins., Docket No. 1:05-CV-00436 (S.D. Miss.<br />
Sept. 30, 2006). Private parties sought certification for class action for<br />
damages against oil and chemical company defendants under theories of<br />
public and private nuisance, unjust enrichment, negligence, conspiracy,<br />
fraudulent concealment, and trespass.<br />
• Native Village of Kivalina v. Exxon Mobil, Docket No. 08-CV-1138 (N.D.<br />
Cal. <strong>Fe</strong>b 26, 2008). Native tribe and municipal government sought injunctive<br />
relief and damages against energy companies and utilities under theories of<br />
private and public nuisance and conspiracy.<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 8<br />
Climate Change and <strong>NRD</strong> …?<br />
If it Walks Like a Duck …<br />
Do These Allegations Sound Like <strong>NRD</strong> Claims?<br />
Connecticut v. AEP:<br />
“With regard to future injuries, the complaint categorizes in detail<br />
a range of injuries the States expect will befall them within a<br />
span of ten to 100 years if global warming is not abated. Among<br />
the injuries they predict are: … significant beach erosion;<br />
accelerated sea level rise and the subsequent inundation of<br />
coastal land and damage to coastal infrastructure;<br />
salinization of marshes and water supplies; lowered Great<br />
Lakes water levels, and impaired shipping, recreational use . .<br />
. resulting in property damage; increased wildfires . . . and the<br />
widespread disruption of ecosystems....”<br />
15<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>Fe</strong>deral Trustee Efforts<br />
NOAA Pilot Project: Climate Assessment<br />
and Proactive Response Initiative (CAPRI)<br />
• Pilot began in January 2009 and is in the<br />
development phase<br />
• Puget Sound, Washington is the focus for<br />
the CAPRI Pilot Project<br />
• The goal of CAPRI is to prepare for, mitigate,<br />
and adapt to climate change-related<br />
contaminant impacts in the coastal zone<br />
16<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 9<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>Fe</strong>deral Trustee Efforts<br />
NOAA Climate Change Assessment<br />
Components<br />
Threat Assessment:<br />
– Apply regionalized climate change<br />
data and models<br />
– Map oil infrastructure, waste sites,<br />
and contaminant models<br />
– Identify potential impacts to<br />
sensitive habitats, species, and<br />
human uses<br />
Ecosystem/Species<br />
Vulnerability Index<br />
17<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>Fe</strong>deral Trustee Efforts<br />
NOAA Climate Change Assessment<br />
Components<br />
Vulnerability Index and Assessment:<br />
– Determine values for climate change risk<br />
factors (inundation, air temperature,<br />
wetland habitat change)<br />
– Develop a relationship between potential<br />
impacts and climate change risk factors<br />
– Integrate spatially explicit risks and<br />
values into suite of vulnerability indices<br />
Facility Threat Index<br />
18<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 10<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>Fe</strong>deral Trustee Efforts<br />
NOAA Climate Change Assessment<br />
Components<br />
Identification of Prevention, Response &<br />
Restoration Options:<br />
– Evaluate methods, risks and benefits<br />
associated with various<br />
response/prevention strategies<br />
– Provide recommendations for further<br />
analysis<br />
– Asses a series of vulnerability indices<br />
are calculated that combine climate<br />
change impacts, human uses, habitats,<br />
species and potential releases<br />
Human Use Vulnerability<br />
Index<br />
19<br />
Climate Change and <strong>NRD</strong> …?<br />
<strong>Fe</strong>deral Trustee Efforts<br />
Example of Combined<br />
NOAA Climate<br />
Change Assessment<br />
Components<br />
Snohomish Estuary<br />
Vulnerability Indices<br />
2100<br />
• Commencement Bay<br />
• Lower Duwamish River<br />
• Nisqually Estuary/Olympia<br />
• Snohomish Estuary<br />
20<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 11<br />
Climate Change and <strong>NRD</strong> …?<br />
State Trustees Speak Out<br />
Montana Officials Express Concern About the Effects of<br />
Climate Change on the State’s Natural Resources<br />
Effected Resources<br />
Forestry<br />
Decreased<br />
crop yields<br />
Longer<br />
forest fire<br />
seasons<br />
Reduced<br />
snowpack<br />
Declining<br />
hydropower<br />
Reduced<br />
wildlife habitat<br />
Diminished<br />
water quality<br />
Diminished<br />
stream flow<br />
“When Glacier [National Park] was<br />
designated a national park 100<br />
years ago, 150 glaciers glittered<br />
along its mountaintops. Only 27<br />
remain today and they all may be<br />
gone by the year 2022, should<br />
current weather patterns continue.”<br />
http://deq.mt.gov/climatechange/<br />
21<br />
The Gulf: LA Coordination With Other Trustees<br />
LOSCO serves as the single point of contact for all programs<br />
related to oil spills in Louisiana.<br />
LOSCO<br />
22<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 12<br />
:<br />
Gulf Restoration Considerations …<br />
Creating gains to offset losses:<br />
• Restore and create habitats for native<br />
species;<br />
• Restore shoreline, dunes and<br />
marshes.<br />
Project Types:<br />
• Ecosystem restoration of Barrier<br />
Islands;<br />
• Reconstruction of coastal landforms;<br />
• Restoration of freshwater and<br />
sediment inputs.<br />
23<br />
Gulf Restoration …<br />
Existing Projects Provide Examples:<br />
• Barataria Basin Shoreline Restoration Study<br />
• Terrebonne Basin Barrier Shoreline Study<br />
24<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 13<br />
The Gulf . . . Private Claims?<br />
OPA Claims (33 U.S.C.§ 2702 (b)(2)) Covered Damages:<br />
• Loss or loss of use<br />
• Damage to real or personal property<br />
• Loss of “subsistence use” of natural resources<br />
• Loss of taxes, royalties, rents, fees, profits or other revenues<br />
due to injury, destruction or loss of real or personal property<br />
recoverable by the United States, a state or a political<br />
subdivision<br />
• Damages equal to lost profits or impairment of earning<br />
capacity due to damage or destruction of real property,<br />
personal property or natural resources … recoverable by any<br />
claimant<br />
25<br />
The Rise of Private Claims …?<br />
Will We See More Local and Private<br />
Party Litigation?<br />
• Drinking Water Cases?<br />
• Climate Change?<br />
• Common Law Claims?<br />
• Spin-offs - Economic Loss Litigation for<br />
Diminished and Lost Resource Services?<br />
26<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 14<br />
<strong>NRD</strong> – Insurance Coverage Considerations<br />
Insurance Policies<br />
• CGL – Occurrences Prior to 1986<br />
• PLL – Claims After 1996<br />
• Does <strong>NRD</strong> Result from Separate Occurrences?<br />
Prior Insurance Settlements<br />
• Are settlements for Policy Buy Backs, for Specific Lines of<br />
Coverage, Site Specific and/or Claim Specific?<br />
• Policy Buy Backs Will Likely Negate All Coverage,<br />
Including <strong>NRD</strong><br />
• Look for Carve Outs<br />
27<br />
Questions?<br />
Please contact me anytime with additional<br />
questions:<br />
Ira Gottlieb<br />
(973) 639-7984<br />
igottlieb@mccarter.com<br />
28<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ira Gottlieb of McCarter & English, LLP Speaker 11: 15<br />
Additional Sources of Information<br />
• Ira Gottlieb, Richard W. Dunford and Cynthia S. Betz,<br />
“A Practical Guide to Litigating Natural Resource<br />
Damages Claims,” Environmental Litigation: Law and<br />
Strategy, Cary R. Perlman, Editor (ABA 2009).<br />
• “Natural Resource Damages for Climate Change …,” J.<br />
Wylie Donald, Ira Gottlieb, et al., Environmental Claims<br />
Journal: Vol. 20:4, at 256-272, and Vol. 21:1, 2-28.<br />
• “Recovery of Natural Resource Damages Under<br />
Comprehensive General Liability Policies,” Mealey’s<br />
Litigation Reports: Insurance, Vol. 17, No.3 (June 10,<br />
2003).<br />
29<br />
Additional Sources of Information<br />
Trustee Websites:<br />
• http://www.darrp.noaa.gov/<br />
• http://www.darrp.noaa.gov/partner/cap/index.html<br />
• http://www.fws.gov/<br />
• http://www.darrp.noaa.gov/northwest/puget_sound/index.html<br />
• http://www.fws.gov/northeast/njfieldoffice/Passaic/Passaic_Index.htm<br />
• http://www.doj.mt.gov/lands/naturalresource/default.asp<br />
• http://www.dec.ny.gov/regulations/2411.html<br />
30<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Lessons Learned from Managing Complex <strong>NRD</strong><br />
Cases<br />
John Carlucci, Esq.<br />
U.S. Department of the Interior<br />
Washington, DC<br />
Nathaniel Barber, Esq.<br />
New York State Department of Environmental Conservation<br />
Albany, NY<br />
Ken L. Frank<br />
Chevron Environmental Management Company<br />
San Ramon, CA<br />
Sheri L. Moreno, Esq.<br />
General Electric Company<br />
Albany, NY
John Carlucci of U.S. Department of the Interior Speaker 12: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John Carlucci of U.S. Department of the Interior Speaker 12: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Nathaniel Barber of New York State Department of Environmental Conservation Speaker 13: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Nathaniel Barber of New York State Department of Environmental Conservation Speaker 13: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 1<br />
Lessons Learned from Managing Complex<br />
<strong>NRD</strong> Cases<br />
Ken Frank<br />
Regulatory Affairs Manager<br />
Chevron Environmental Management Company<br />
July 15 th , <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
© <strong>2010</strong> Chevron<br />
Managing Complex <strong>NRD</strong> Cases<br />
Our view of the Challenges!<br />
Our key principles!<br />
Establishing the right team!<br />
Working with the stakeholders<br />
© <strong>2010</strong> Chevron<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 2<br />
Challenges of CERCLA Sites<br />
<br />
<br />
<br />
<br />
<br />
<br />
Multi-party sites with difficult questions<br />
about who is liable and for what<br />
Many questions over when the release<br />
occurred and the effects of the release<br />
Proscriptive cleanup process that does<br />
not incorporate trustees, other than<br />
notifications<br />
<strong>NRD</strong> claims that occur after the cleanup<br />
action is complete<br />
Duplication of studies and cleanup efforts<br />
with little environmental benefit to the<br />
public<br />
Urban and Industrial Waterways that<br />
have been in use for 100’s of years<br />
© <strong>2010</strong> Chevron<br />
3<br />
Challenges of Managing <strong>NRD</strong> Cases<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
General unpredictability of the <strong>NRD</strong>A process<br />
Potential for Setting Unreasonable Restoration Goals<br />
Second Guessing EPA Clean-Up Decisions / Second Clean-up<br />
Speculative Monetary Claims for Past “Lost-Use” Damages<br />
Arbitrary Claims for “Non-Use” Values Based on Public Opinion Polls<br />
Maintaining a Reasonable Balance of Costs and Benefits<br />
Ignoring Causation<br />
Retroactivity<br />
© <strong>2010</strong> Chevron<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 3<br />
Our Key Principles for <strong>NRD</strong><br />
Focus actions and goals<br />
on restoration of lost<br />
natural resources;<br />
Benefit stakeholders by<br />
cost-effective, reasonable<br />
and prompt actions;<br />
Reduce the unpredictability<br />
of the <strong>NRD</strong>A process, and<br />
Minimize transaction costs<br />
and avoid litigation.<br />
© <strong>2010</strong> Chevron<br />
5<br />
Chevron’s Management Approach to Success<br />
• Experienced project managers with an increased awareness of<br />
<strong>NRD</strong>A<br />
• Internal Technical experts that are experienced <strong>NRD</strong>A specialists<br />
• Experienced outside consultants with approaches that are aligned<br />
with Chevron’s objectives<br />
• Experienced outside counsel with an understanding of Chevron’s<br />
approach at multiple sites in our portfolio<br />
© <strong>2010</strong> Chevron<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 4<br />
Do your homework!<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Understand Trustees’ Issues/Resources of Interest<br />
Evaluate Scope & Value of Existing Data<br />
Collect Maps/Aerial Photos<br />
Discussions with Industry Colleagues<br />
Identify Public Issues<br />
Identify Potential Restoration Projects<br />
Perform Preliminary HEA-Worst Case<br />
Identify common goals with the Trustees<br />
© <strong>2010</strong> Chevron<br />
7<br />
Conduct a pre-meeting with Trustees!<br />
<br />
<br />
Meeting with Trustees before the official process starts can help RPs<br />
and Trustees achieve the following goals<br />
– understanding the internal management drivers (e.g., for an RP--cost<br />
management and certainty and local PR issues; for Trustees--obtaining<br />
a settlement/project that will have public credibility and withstand the<br />
scrutiny that the respective parties face<br />
– establishing that restoration is the focus of the <strong>NRD</strong>A<br />
– agreeing that studies, if needed, will support restoration decisions<br />
– familiarizing the trustees with the site history, data collected, and results<br />
– managing the scope and direction of the process<br />
Provide the Trustees a concise data summary with charts, tables,<br />
and maps along with an electronic copy of the data<br />
© <strong>2010</strong> Chevron<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 5<br />
Build a common understanding!<br />
<br />
<br />
<br />
Getting Trustees and key PRP decision-makers to the site for a visit is<br />
also helpful- in most cases…<br />
Establishing a working relationship with Trustees is very important,<br />
since the outcome of an <strong>NRD</strong>A often hinges on establishing common<br />
grounds for discussion of critical issues<br />
Our most challenging cases have been in states with limited <strong>NRD</strong>A<br />
experience and where we have no relationship with the Trustees<br />
© <strong>2010</strong> Chevron<br />
9<br />
What’s needed for successful outcomes<br />
<br />
<br />
<br />
<br />
<br />
<br />
Focus the action and goals on restoration of lost services so that the<br />
benefits to stakeholders are cost-effective, reasonable and prompt<br />
Reduce the unpredictability of the <strong>NRD</strong>A process, minimize<br />
transaction costs, and avoid litigation<br />
Restoration options should include natural recovery alternatives<br />
Injury assessments should focus on measurable adverse changes in<br />
natural resources and their services<br />
Interim losses should be compensated by providing substantially<br />
equivalent substitute public uses or ecologic functions during the<br />
interim period, rather than monetized damages<br />
Trustees should be required to demonstrate the baseline ecological<br />
conditions, including prior discharges and physical alteration of the<br />
environment, and to include the baseline in the injury assessment.<br />
© <strong>2010</strong> Chevron<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 6<br />
Lastly, What are we doing?<br />
Promoting cooperative assessments<br />
Coordinating response and restoration plans to eliminate<br />
duplication of efforts<br />
Supporting interactive forums and discussions<br />
Supporting the Joint Assessment Teams<br />
Participating in the development of policy that promotes<br />
reasonable frameworks and creative approaches;<br />
Advocating for statutory and regulatory changes, where<br />
necessary to assure that the overall benefit accrues to the<br />
public.<br />
© <strong>2010</strong> Chevron<br />
11<br />
Key Principles – Background Slides<br />
<br />
<br />
<br />
<br />
Focus actions and goals on restoration of lost natural resources;<br />
Benefit stakeholders by cost-effective, reasonable and prompt<br />
actions;<br />
Reduce the unpredictability of the <strong>NRD</strong>A process, and<br />
Minimize transaction costs and avoid litigation.<br />
© <strong>2010</strong> Chevron<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 7<br />
Focus actions and goals on restoration of lost natural<br />
resources<br />
<strong>NRD</strong> Actions should focus on restoration of the lost<br />
ecological services.<br />
This can be done by<br />
– Active restoration<br />
– Natural recovery<br />
– Replacement and/or<br />
– Acquisition of equivalent resources<br />
© <strong>2010</strong> Chevron<br />
13<br />
Benefit stakeholders by cost-effective, reasonable and<br />
prompt actions<br />
Natural resource restoration, replacement or acquisition<br />
actions must be:<br />
– cost-effective<br />
– cost- reasonable<br />
– prompt, and<br />
– consistent with the selected clean up remedy<br />
© <strong>2010</strong> Chevron<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 8<br />
Reduce the unpredictability of the <strong>NRD</strong>A process<br />
Injury assessments must focus on measurable adverse<br />
changes in natural resources and their services<br />
Injury assessments should be based on the ecologically<br />
relevant resource population level, rather than discrete<br />
individuals<br />
Trustees must demonstrate the baseline ecological<br />
conditions, including prior discharges and physical<br />
alteration of the environment, and to include the baseline<br />
in the injury assessment<br />
© <strong>2010</strong> Chevron<br />
15<br />
Minimize transaction costs<br />
<br />
<br />
Incorporate successful experiences achieved under OPA<br />
– Cooperative Assessments<br />
– Timely response and restoration actions<br />
Coordinate the response action with the restoration plan wherever<br />
possible<br />
– Conduct Ecological Risk Assessment at the same time as the Human<br />
Health Risk Assessment<br />
– Include Trustees in development of the assessment work plans to<br />
eliminate duplicative efforts<br />
© <strong>2010</strong> Chevron<br />
16<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Ken L. Frank of Chevron Environmental Management Company Speaker 14: 9<br />
Avoid Litigation<br />
<br />
<br />
<br />
Eliminate so-called “non-use” or “passive use” values (e.g. use of the<br />
contingent valuation method)<br />
Interim losses can be compensated by providing substantially<br />
equivalent substitute public uses or ecologic functions, rather than<br />
monetized damages<br />
Any legal proceedings to recover <strong>NRD</strong> shall be by trial de novo<br />
(affording defendants the right to introduce evidence) and the trustees<br />
should have the burden of proving their damages by a preponderance<br />
of the evidence<br />
© <strong>2010</strong> Chevron<br />
17<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Sheri L. Moreno of General Electric Company Speaker 15: 1<br />
Challenges of Managing Complex<br />
<strong>NRD</strong> Litigation and Complex Remedy<br />
Sheri Moreno<br />
<strong>LSI</strong> <strong>NRD</strong> Conference<br />
July 15, <strong>2010</strong><br />
1<br />
What are the Issues?<br />
• How do remediation and restoration fit together at<br />
megasites? Or do they?<br />
• How do remedial decisions impact <strong>NRD</strong> claims?<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Sheri L. Moreno of General Electric Company Speaker 15: 2<br />
Hudson River Dredging Project – An Example<br />
• 1947-1976 - PCBs were discharged from two GE manufacturing facilities in the Upper<br />
Hudson River<br />
• 1976 – GE settled all claims with New York State for PCB discharges to the Hudson River<br />
• 1983 – Hudson River PCBs Superfund Site was listed on the NPL<br />
• 1984 – EPA ROD – no dredging<br />
• 1989-2000 – EPA Reassessment RI/FS<br />
• 1990 – Consent Decree to remediate remnant deposits<br />
• 1997 – <strong>NRD</strong>A Preassessment Screen<br />
• 2002 – EPA ROD selects dredging of PCBcontaining<br />
sediments in Upper Hudson River<br />
• 2002 – <strong>NRD</strong>A Plan Issued<br />
• 2003-2005 – 3 GE/EPA Agreements<br />
• 2009 – Phase 1 Dredging<br />
• <strong>2010</strong> – Phase 1 Peer Review/Phase 2 Election<br />
2<br />
Remediation and Restoration Don’t Always “Fit” –<br />
Especially at Megasites<br />
• EPA/Trustees - different standards and considerations<br />
• Trustees have consistently advocated for significantly bigger<br />
more complex remedy<br />
• Trustees have taken positions that have presented many<br />
challenges for GE to reach agreement with EPA – and that<br />
continues<br />
• Resolution of both remediation and restoration at the same time<br />
isn’t always possible – megasites more difficult<br />
• Stakes are bigger<br />
• Questionable liability<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Sheri L. Moreno of General Electric Company Speaker 15: 3<br />
Remedy-Caused Impacts and <strong>NRD</strong><br />
• Trustees have already advised GE that they intend to seek damages for<br />
remedy-caused injuries to Hudson River natural resources<br />
• Whether such damages are recoverable is not well settled<br />
• No case law addressing this issue<br />
• Section 107 of CERCLA is general – “trustee may recover for injury<br />
to, destruction, or loss of natural resources, including reasonable costs<br />
of assessment, resulting from such a release of hazardous substances”<br />
• Type B Regulations not tested or interpreted by courts; Provide that<br />
trustees may recover <strong>NRD</strong> for “any increase in injuries that are<br />
reasonably unavoidable as a result of response actions taken or<br />
anticipated.”<br />
• Fact Question – Has there been an increase in “injuries” and were<br />
they “reasonably unavoidable”<br />
Phase 1: What EPA Sought to Accomplish<br />
`<br />
• Removal of 265,000 cubic yards of sediment from 18 dredge areas<br />
• Removal of 89,000 cubic yards of sediment during one 30-day period (to ensure<br />
project is completed in six years)<br />
• PCB water levels below 500 parts per trillion during dredging (the federal drinking<br />
water standard)<br />
• PCB mass released downstream during dredging not to exceed 117 kg (258 pounds)<br />
— the tipping point at which the benefits of the selected remedy are outweighed by<br />
the short-term adverse impacts<br />
• PCB levels on the surface of the river bottom post-dredging are below an average of<br />
0.25 parts per million<br />
EPA’s Goals: To Reduce PCB Levels in Water, in Fish,<br />
in Sediment and Flowing Downstream<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Sheri L. Moreno of General Electric Company Speaker 15: 4<br />
Phase 1: What was Accomplished<br />
• 286,000 cubic yards of sediment<br />
removed, enough to cover 50 football<br />
fields to depth<br />
of three feet<br />
— Surpassed EPA’s goal to<br />
remove 265,000 cubic yards<br />
— 35,000 pounds of PCBs<br />
removed<br />
• 150,000 cubic yards of clean fill<br />
placed<br />
in dredged areas<br />
• 50,000 plants to be placed by divers<br />
this summer to restore habitat<br />
2<br />
7<br />
Phase 1 Findings — Resuspension<br />
• Resuspension was far greater than EPA<br />
projected: 3% to 4% of PCBs dredged<br />
washed downstream<br />
• GE implemented every best management practice<br />
required by EPA to control resuspension<br />
• Higher resuspension led to higher PCB levels in<br />
water, fish, sediment and downstream during and<br />
after dredging<br />
• Higher resuspension levels interrupted long-term<br />
decline in PCB levels in water and fish<br />
• Resuspension led to PCBs settling downstream on top<br />
of sediments not targeted for removal<br />
• As a result of higher resuspension, EPA standards to protect water were not met<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Sheri L. Moreno of General Electric Company Speaker 15: 5<br />
Phase 1: Findings — Fish<br />
• PCB levels in Upper Hudson Fish increased<br />
— 500% increase in PCB levels in pumpkinseed<br />
and forage fish collected close to dredging<br />
(Thompson Island Pool/Fort Edward)<br />
— 40%-65% increase in PCB levels in<br />
same species 40 miles south of<br />
dredging at Albany<br />
11<br />
The Path Forward: Finding Right Balance<br />
• GE will work with EPA to design an improved Phase 2<br />
• Use Phase 1 data to identify “tipping point” where dredging sends more PCBs downstream than no<br />
dredging<br />
• Set “tipping point” as maximum limit on mass of PCBs that dredging can send downstream<br />
• Calculate mass of sediments and PCBs that can be removed within that limit, assuming the rate of<br />
resuspension experienced during Phase 1<br />
• Prioritize dredging areas to target PCBs available to fish (to obtain maximum benefit)<br />
• Dredge until maximum limit on mass of PCBs is reached<br />
• Reduce inefficient redredging<br />
• Continue to comply with federal drinking water limit<br />
• Complete work in 5 years, as EPA promised, and accelerate river recovery<br />
• Achieve EPA long-term environmental goals and minimize immediate impacts<br />
17<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Case Law Update and <strong>NRD</strong> Claims Around the<br />
Country<br />
John K. Dema, Esq.<br />
Law Offices of John K. Dema, P.C.<br />
Christiansted, VI<br />
Bill Jackson, Esq.<br />
Jackson Gilmour & Dobbs, PC<br />
Houston, TX<br />
Scott E. Kauff, Esq.<br />
Law Offices of John K. Dema, P.C.<br />
Rockville, MD
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 1<br />
Speaker 17: 1<br />
Speaker 18: 1<br />
Natural Resource Damage<br />
Case Law Update<br />
William J. Jackson<br />
Jackson Gilmour & Dobbs, PC<br />
John K. Dema<br />
Scott E. Kauff<br />
Law Offices of John K. Dema, P.C.<br />
Disclaimer<br />
The views expressed are those of William<br />
J. Jackson, John K. Dema, and Scott E.<br />
Kauff and may or may not reflect the<br />
views of clients of Jackson Gilmour &<br />
Dobbs, PC<br />
and<br />
Law Offices of John K. Dema, P.C.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 2<br />
Speaker 17: 2<br />
Speaker 18: 2<br />
Oklahoma v. Tyson Foods<br />
(N.D. Okla. 2009)<br />
Holding – Dismissed State’s <strong>NRD</strong> claims<br />
regarding Watershed because of failure to<br />
join an indispensible party.<br />
Oklahoma v. Tyson Foods<br />
(N.D. Okla. 2009)<br />
REASONING<br />
Because Cherokee Nation tribe has substantial<br />
interests in land, water, and other natural resources<br />
in the Watershed about which the State has brought<br />
an <strong>NRD</strong> claim, the Cherokee Nation is an<br />
indispensible party under<br />
<strong>Fe</strong>d.R.Civ.P. 19.<br />
The State’s supplemental filing of an agreement<br />
through which the Cherokee Nation attempts to<br />
assign the State the right to prosecute the Cherokee<br />
Nation’s <strong>NRD</strong> claims did not resolve <strong>Fe</strong>d.R.Civ.P. 19<br />
problem because agreement was invalid under<br />
Oklahoma law.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 3<br />
Speaker 17: 3<br />
Speaker 18: 3<br />
Commissioner v. Century Alumina<br />
(D.V.I. July 13, <strong>2010</strong>)<br />
1st Key Holding<br />
3-Year Statute of Limitations in CERCLA<br />
§ 113(g)(1)(A) is a constructive knowledge<br />
standard (i.e., should have discovered the<br />
loss and its connection with the release in<br />
question).<br />
Commissioner v. Century Alumina<br />
(D.V.I. July 13, <strong>2010</strong>)<br />
2 nd Key Holding<br />
Although Trustee is an individual, he is<br />
charged with the knowledge of the<br />
employees of agency over which he<br />
presides.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 4<br />
Speaker 17: 4<br />
Speaker 18: 4<br />
Commissioner v. Century Alumina<br />
(D.V.I. July 13, <strong>2010</strong>)<br />
3 rd Key Holding<br />
Defendants bear burden of proving that<br />
the Trustee’s claim is time-barred because<br />
he discovered or should have discovered<br />
the loss. Failure by certain defendants to<br />
put forth evidence of loss and assertion of<br />
no loss resulted in failure to meet burden.<br />
Quapaw Tribe of Oklahoma v. Blue Tee<br />
Corp. (N.D. Okla. 2009)<br />
1st Holding<br />
Tribe that demonstrated its quasi-sovereign<br />
interests has Article III standing to bring an<br />
<strong>NRD</strong> claim due to its parens patriae<br />
standing.<br />
Tribe must establish that it is not trying to<br />
recover for purely private interests and must<br />
delineate what damages the trustee may<br />
recover and what damages belong to private<br />
citizens.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 5<br />
Speaker 17: 5<br />
Speaker 18: 5<br />
Quapaw Tribe of Oklahoma v. Blue Tee<br />
Corp. (N.D. Okla. 2009)<br />
2 nd Holding<br />
Under Oklahoma law, a claim for lost<br />
beneficial use or reduced value of real<br />
property are the land owner’s claim. The<br />
Tribe’s <strong>NRD</strong> claim under state law should<br />
focus on redressing harm to natural<br />
resources, not loss of use of land.<br />
In Re Settoon Towing, LLC<br />
(E.D. La. 2009)<br />
1st Holding<br />
Because the Oil Pollution Act’s (“OPA’s”)<br />
damages provision preempts the general<br />
maritime law, it is not necessary to show a<br />
physical injury to a proprietary interest in<br />
order to recover economic losses.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 6<br />
Speaker 17: 6<br />
Speaker 18: 6<br />
<br />
In Re Settoon Towing, LLC<br />
(E.D. La. 2009)<br />
2 nd Holding<br />
In the context of a Complaint for Exoneration<br />
from or Limitation of Liability, pursuant to the<br />
Limitation of Liability Act, 46 U.S.C. § 181, et<br />
seq., the court refused to dismiss an <strong>NRD</strong> claim<br />
against a barge owner by an owner of a well<br />
that sprayed oil into a bayou due to the well<br />
being struck by a barge.<br />
Note that this reasoning is based upon the<br />
prejudice the well owner could suffer from a<br />
dismissal due to the nature of a limitation of<br />
liability proceeding.<br />
Arizona v. Acme Laundry & Dry<br />
Cleaning (D. Ariz. 2009)<br />
Holding<br />
Rejects CERCLA (and state law) consent<br />
decree entered into between Arizona DEQ<br />
and small business because the parties did<br />
not provide the court with a preliminary<br />
estimate of <strong>NRD</strong> although the business<br />
unable to pay substantial damages.<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 7<br />
Speaker 17: 7<br />
Speaker 18: 7<br />
NJDEP et al. v. Essex Chem. Corp.<br />
(Sup. Ct. of NJ, Law Div. <strong>2010</strong>, Oral<br />
Opinion)<br />
Context – Court’s oral opinion refusing to<br />
exclude Plaintiffs’ damages expert at outset<br />
of the trial.<br />
Holding<br />
NJ’s Appellate Division decision in Exxon Mobil<br />
does not state that compensatory restoration<br />
claims are limited to loss of use damages or lost<br />
services. The court refused to make a<br />
preliminary ruling on the issue of damages in<br />
the context of a motion to exclude an expert.<br />
BP Oil Spill<br />
What’s Next?<br />
Standard to establish “gross negligence or<br />
willful misconduct” under OPA to<br />
overcome damages cap.<br />
Standard to establish a responsible party<br />
failed to “provide all reasonable<br />
cooperation and assistance required by a<br />
responsible official in connection with<br />
removal activities.”<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Bill Jackson of Jackson Gilmour & Dobbs, PC<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16: 8<br />
Speaker 17: 8<br />
Speaker 18: 8<br />
What’s Next?<br />
BP Spill Cont’d.<br />
Relationship between private and trustees’<br />
claims<br />
Relationship among federal trustees’ and<br />
state trustees’ claims<br />
New Jersey<br />
Essex Chemical bench trial decision<br />
Exxon Bayway Appeal by Plaintiffs –<br />
whether Plaintiffs can recover <strong>NRD</strong>A costs<br />
while litigation is pending where <strong>NRD</strong>A<br />
was performed by testifying experts.<br />
Contact Info<br />
Jackson Gilmour & Dobbs, P.C.<br />
William J. Jackson<br />
713-355-5050<br />
bjackson@jgdpc.com<br />
Law Offices of John K. Dema, P.C.<br />
John K. Dema<br />
(340) 773-6142<br />
jdema@lojkd.com<br />
Scott E. Kauff<br />
(301) 881-5900<br />
skauff@lojkd.com<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 1<br />
Speaker 18b: 1<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 2<br />
Speaker 18b: 2<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 3<br />
Speaker 18b: 3<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 4<br />
Speaker 18b: 4<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 5<br />
Speaker 18b: 5<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 6<br />
Speaker 18b: 6<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 7<br />
Speaker 18b: 7<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 8<br />
Speaker 18b: 8<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 9<br />
Speaker 18b: 9<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 10<br />
Speaker 18b: 10<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
John K. Dema of Law Offices of John K. Dema, P.C.<br />
Scott E. Kauff of Law Offices of John K. Dema, P.C.<br />
Speaker 16b: 11<br />
Speaker 18b: 11<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 1<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 2<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 3<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 4<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 5<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 6<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 7<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 8<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 9<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 10<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 11<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 12<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 13<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 14<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 15<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Bill Jackson of Jackson Gilmour & Dobbs, PC Speaker 17b: 16<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/15/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Strategies for Determining Baseline<br />
Michael R. Thorp, Esq.<br />
Summit Law Group<br />
Seattle, WA<br />
Paul D. Boehm, Ph.D.<br />
Exponent, Inc.<br />
Maynard, MA
Michael R. Thorp of Summit Law Group Speaker 19: 1<br />
Michael R. Thorp<br />
July 16, <strong>2010</strong><br />
Michael Thorp:<br />
Basics of baseline<br />
Source<br />
How baseline is used<br />
Baseline examples<br />
Considerations<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 2<br />
Dr. Paul Boehm:<br />
How baseline is used<br />
(cont’d)<br />
Baseline and background<br />
How baseline is measured<br />
Common approaches for<br />
determining background<br />
Considerations<br />
Baseline is the condition of the ecological<br />
services “but for” the release of oil or<br />
hazardous substances.<br />
Interior: Baseline is the “condition or conditions<br />
that would have existed at the assessment area<br />
had the discharge of oil or release of the<br />
hazardous substance under investigation not<br />
occurred.”<br />
43 CFR 11.14(e)<br />
NOAA: Baseline “means the condition of the<br />
natural resources and services that would have<br />
existed had the incident not occurred.”<br />
15 CFR 990.30.<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 3<br />
<br />
NOAA Mussel watch program: 3 teams to test<br />
shellfish, sediment and water at 60 locations<br />
Natural Conservancy: Database going back 12<br />
years<br />
<br />
<br />
<br />
Natural Park Service: Documenting conditions at<br />
98 sites along the Gulf Coast<br />
Audubon Society: Nest counts for brown pelicans<br />
and terns<br />
Various groups: send us photos and video<br />
“Baseline” is not mentioned in any<br />
of the key operative statutes.<br />
CERCLA: trustees are only entitled to damages<br />
“resulting from such a release.” 42 USC 9607(4)(C)<br />
OPA: trustees only entitled to “damages…that result<br />
from such incident.” 33 USC 2702(a)<br />
CWA: recoverable costs include “any<br />
costs…incurred… in the restoration or replacement<br />
of natural resources damaged…as a result of a<br />
discharge of oil or a hazardous substance…” 33<br />
USC 1321(f)(4)<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 4<br />
Interior:<br />
43 C.F.R. §11.70(a) describes how the trustees are to<br />
use the baseline concept in quantifying the alleged<br />
injury:<br />
(a) Requirement. (1) Upon completing the<br />
Injury Determination phase, the authorized<br />
official shall quantify for each resource<br />
determined to be injured and for which damages<br />
will be sought, the effect of the discharge or<br />
release in terms of the reduction from the<br />
baseline condition in the quantity and quality of<br />
services, as the phrase is used in this part,<br />
provided by the injured resource using the<br />
guidance provided in the Quantification phase of<br />
h<br />
Origin of Baseline – Regulations<br />
(cont’d)<br />
43 C.F.R. §11.72 – “Quantification phase<br />
– baseline services determination” sets<br />
forth how the calculation of baseline<br />
is actually carried out.<br />
General Guidelines<br />
Use of Historical data<br />
Control areas<br />
Resource by resource guidelines<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 5<br />
Origin of Baseline – Regulations<br />
(cont’d)<br />
DOI Steps in Quantification 43 CFR<br />
11.70(c)<br />
Measure extent of injury<br />
Estimate baseline services<br />
Determine recoverability<br />
Determine reduction in baseline services<br />
Consistent link from quantification<br />
to damages is needed<br />
Origin of Baseline – Regulations<br />
(cont’d)<br />
NOAA:<br />
“Trustees must quantify the<br />
degree, and spatial and temporal<br />
extent of such injuries relative to<br />
baseline.”<br />
15 CFR 990.52.<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 6<br />
Origin of Baseline – Regulations<br />
(cont’d)<br />
Baseline also establishes the<br />
restoration objective.<br />
Interior: “Restoration…means actions<br />
undertaken to return an injured<br />
resource to its baseline condition…”<br />
43 CFR 11.14(II).<br />
NOAA: The restoration goal of OPA<br />
“is achieved through the return of the<br />
injured natural resources and services<br />
to baseline…” 15 CFR 990.10.<br />
Very little case law on baseline.<br />
Coeur d’Alene Tribe v. Asarco, 280 F.<br />
Supp. 2d 1094, 1105 (D. Idaho 2003):<br />
Forest fires, channelization and<br />
urbanization have impacted the waterways<br />
and soil, but the largest source of metal<br />
loading in the Basin is from mining waste.<br />
Separating the damage to the environment<br />
from other causes versus the mining waste<br />
will be determined in the second phase of<br />
trial.<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 7<br />
(cont’d)<br />
In re Acushnet River & New Bedford<br />
Harbor proceedings, 712 F. Supp. 1019,<br />
1030 (D. Mass. 1989):<br />
[T]he responsibility for the condition of<br />
New Bedford Harbor is diffuse in another<br />
respect. The sovereigns here seek to<br />
recover only for that injury to natural<br />
resources caused by PCB contamination,<br />
yet the Harbor appears rife with a variety<br />
of contaminants. It may prove difficult to<br />
distinguish whether some injury is caused<br />
by PCBs or by other pollutants.<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 9<br />
Habitat alteration; urbanization<br />
Dams and locks<br />
Flood control<br />
Resource mismanagement<br />
Other chemicals<br />
Nonpoint source runoff<br />
Climate change<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Michael R. Thorp of Summit Law Group Speaker 19: 10<br />
Natural variability<br />
Introduction of exotic species<br />
Commercial and recreational harvest<br />
Baseline is an essential component in a<br />
defense.<br />
Baseline is primarily a defense issue –<br />
trustees will try to avoid or minimize.<br />
Law related to baseline is largely<br />
unsettled.<br />
Opportunities for creative arguments.<br />
Must have top-quality experts.<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 1<br />
Baseline and Background:<br />
The Scientific Perspective<br />
Paul D. Boehm, Ph.D.<br />
July 16, <strong>2010</strong><br />
2<br />
In the Real World of Natural Resources<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 2<br />
3<br />
Key Technical Issues in Most <strong>NRD</strong>As<br />
Injury measurement<br />
Release<br />
Exposure<br />
Harm<br />
Baseline<br />
Causality<br />
Service losses<br />
4<br />
Baseline and Background<br />
Baseline pertains to the<br />
condition of the resources,<br />
but for the release<br />
Overarching term, but mainly<br />
used to relate to “services”<br />
Background is a term that<br />
relates to chemical levels<br />
May or may not relate to<br />
“exposure”<br />
Depends on bioavailability<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 3<br />
View of Baseline is Often Distorted<br />
Recovery is the return to baseline services—<br />
Not pre-spill conditions<br />
5<br />
Some Factors Affecting the Baseline and Its<br />
Measurement<br />
Natural variability affects resource populations<br />
Normal population fluctuations<br />
Climate change (e.g., ocean temperatures, rainfall patterns,<br />
water resources)<br />
Storms and habitat destruction<br />
Pre-release and “but for” release conditions<br />
(“reference”) are likely different<br />
Exact measures of baseline depend on resources<br />
Sediment resources (use reference sites)<br />
Wildlife populations (range of pre-release conditions)<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 4<br />
Catastrophic Natural Changes Reset the Baseline (?)<br />
7<br />
Pre-Release Data Vital to Understanding of<br />
Wildlife Populations<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 5<br />
Baseline Includes Natural Variation<br />
9<br />
Natural life cycle of Fucus—Not oil spill effect<br />
“The Background” is One of the Most Important<br />
Technical Issues in <strong>NRD</strong> Cases<br />
Frontlines of divisibility<br />
For most <strong>NRD</strong>As, baseline<br />
chemical conditions are not<br />
pristine<br />
Natural factors and<br />
anthropogenic impacts not<br />
related to the release<br />
Combination of methods<br />
commonly used to establish<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 6<br />
11<br />
Background and Oil Spills (e.g., Deepwater Horizon)<br />
Mississippi River<br />
Runoff<br />
Exxon Valdez (Alaska)<br />
Natural Oil Seeps<br />
Hypoxia (“Dead Zone”)<br />
12<br />
Influence of Mississippi River<br />
Discharges<br />
Exxon Valdez (Alaska)<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 7<br />
13<br />
Definitions<br />
Background concentrations of chemicals<br />
Concentration of a chemical expected at a location absent<br />
any contribution from a purported source<br />
Chemical levels “but for” the release(s)<br />
Regulatory terminology and definitions vary<br />
Two main splits<br />
Contamination “but for” a release (anthropogenic)<br />
Levels in non-industrial areas (natural)<br />
14<br />
From EPA OSWER 9285.6-07P<br />
Background: Refers to constituents or locations that are<br />
not influenced by the releases from a site, and is usually<br />
described as naturally occurring or anthropogenic<br />
(U.S. EPA 1989, 1995a):<br />
Anthropogenic: Natural and human-made substances<br />
present in the environment as a result of human activities<br />
(not specifically related to the CERCLA release in question)<br />
Naturally occurring: Substances present in the<br />
environment in forms that have not been influenced by<br />
human activity<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 8<br />
15<br />
From NJ DEP (Fields et al. 1993)<br />
A split of “anthropogenic”<br />
Soil "background" may be viewed as a continuum of<br />
values in which a concentration gradient of<br />
anthropogenic pollution is superimposed onto the<br />
preexisting distribution of concentrations found in<br />
nature<br />
This concentration gradient ranges from diffuse<br />
anthropogenic pollution (DAP), to local, identifiable<br />
point sources (IPS)<br />
Both DAP and IPS are fair game in defining background<br />
(according to Boehm)<br />
16<br />
Approaches for Determining Background<br />
Literature values<br />
Reference-area concentrations—<br />
Data from "unaffected” area<br />
Upgradient or upwind<br />
concentration<br />
Historical reconstruction<br />
geochronology<br />
Chemical fingerprinting<br />
Bulk sediment?<br />
Bioavailable fraction<br />
through<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 9<br />
17<br />
Sources of Information: Literature<br />
ATSDR ToxProfiles<br />
>300 substances<br />
Literature review<br />
of levels found<br />
in environmental<br />
media<br />
Air<br />
Water<br />
Soil/sediment<br />
18<br />
Sources of Information: Literature (continued)<br />
National databases<br />
USGS<br />
Arsenic Concentrations<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 10<br />
19<br />
Background Data—Many Publications<br />
20<br />
Site-Specific Background Data<br />
Choose background samples as comparable as feasible<br />
to affected samples (e.g., oiled versus unoiled sites)<br />
Collect enough samples<br />
Be aware of agency guidance<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 11<br />
State Guidance for Background Soils—<br />
Examples<br />
State<br />
How Determined<br />
Outside Literature<br />
Ranges Considered<br />
Minimum Number<br />
of Samples<br />
Compositing<br />
Allowed<br />
Alabama Site-specific Yes (site-specific) 4 Sometimes<br />
Arkansas<br />
Site-specific or<br />
literature<br />
No 4 Yes<br />
California Site-specific Yes Preferably 10 No<br />
Florida Site-specific Possibly 7 or site-specific No<br />
Georgia Site-specific Yes 1 Site-specific<br />
Massachusetts<br />
New Jersey<br />
Wisconsin<br />
Site-specific<br />
preferred<br />
Site-specific<br />
minimum and<br />
literature<br />
Site-specific or<br />
literature<br />
Yes (with site-specific) Depends No<br />
Site-specific minimum<br />
and literature<br />
Yes 4<br />
10 No<br />
Contaminantspecific<br />
21<br />
22<br />
The Legacy Urban Site Conundrum<br />
What is background? Upstream? Preindustrial?<br />
Other chemicals?<br />
Multiple sources<br />
Multiple chemicals<br />
Many and/or continuous releases over time<br />
Confounding background<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 12<br />
Background and Retroactivity<br />
Court has ruled that New Jersey may recover for Natural Resource<br />
Damages prior to the enactment of “The Spill Act” (1977)<br />
ca. 1898 2009<br />
23<br />
Background Pesticide Levels<br />
in the Northeast<br />
Important influence of historical<br />
mosquito control in the Northeast and<br />
elsewhere<br />
1945: Aerial sprays of DDT/kerosene<br />
1959: The Mosquito Commission<br />
requested all municipalities to perform<br />
nightly ground fogging in conjunction with<br />
daily air sprays<br />
Need to do homework; historical<br />
records<br />
24<br />
Source:<br />
http://www.whale.to/vaccines/ddt_spraying.html<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 13<br />
Release into the Arthur Kill<br />
25<br />
Spill<br />
Location<br />
Source: Entrix (2006)<br />
Heavy Industrialization Adjacent to the Arthur<br />
Kill Includes Fresh Kills Landfill<br />
Largest landfill<br />
and largest manmade<br />
structure<br />
on earth<br />
>25 m higher<br />
than the Statue<br />
of Liberty<br />
Visible from<br />
space with the<br />
naked eye<br />
26<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 14<br />
Delineation of Subtidal Impact of Oil Spill:<br />
Background, Large Scale<br />
27<br />
Exxon Valdez<br />
Spill Area<br />
Copper River<br />
Delta<br />
20 Km<br />
N<br />
Coastal Current<br />
Prince William Sound<br />
(PWS)<br />
Sediment plume carried<br />
into PWS by coastal current<br />
Gulf of Alaska<br />
28<br />
Delineation of Subtidal Impact of Oil Spill:<br />
Background at the Local Scale<br />
Historical Records of Human Activity Sites<br />
(Pyrogenic and Petrogenic Sources)<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Paul D. Boehm of Exponent, Inc. Speaker 20: 15<br />
Geochronology and Associated Environmental Forensics<br />
Often Reveal Important Background Information<br />
29<br />
30<br />
Bottom Line<br />
Proper consideration of background is vital<br />
Multiple tools available<br />
Resources need to be set aside to fully investigate<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Bankruptcy and <strong>NRD</strong><br />
Linda R. Larson, Esq.<br />
Marten Law PLLC<br />
Seattle, WA<br />
J. Scott Janoe, Esq.<br />
Baker Botts LLP<br />
Houston, TX
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 1<br />
Speaker 22: 1<br />
Natural Resource<br />
Damages and<br />
Bankruptcy<br />
Lessons from In re ASARCO LLC<br />
Linda Larson, Marten Law<br />
Scott Janoe, Baker Botts L.L.P.<br />
HOU03:1242588<br />
Context and Overview<br />
<br />
Over 100 year old integrated mining, smelting & refining<br />
company<br />
Filed for reorganization under Chapter 11 in 2005<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
$6.5 billion in environmental claims filed against the estate<br />
involving 53 sites in 19 states<br />
Both owned and unowned properties<br />
Four year bankruptcy process:<br />
Majority of sites were settled for unchallenged amounts<br />
13 days of evidentiary hearings on remaining 3 sites<br />
“Global Settlement” with governments for $1.6 billion<br />
Resolved additional "owned property" liabilities in custodial trusts<br />
Additional 2 days of hearings on challenges to settlement<br />
Debtor received covenant not to sue & contribution protection<br />
1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 2<br />
Speaker 22: 2<br />
Assessing Claims<br />
<br />
<br />
<br />
What is a claim?<br />
Owned v. unowned properties<br />
Order issues<br />
2<br />
Assessing Claims (cont'd.)<br />
Scheduling Environmental Claims<br />
<br />
<br />
Effect on dischargeability<br />
Fair Contemplation Test - Potential claimant can tie<br />
the debtor to a known release of a hazardous<br />
substance. Cal. Dep't of Health Servs. v. Jensen (In re<br />
Jensen), 995 F.2d 925 (9th Cir. 1993); In re Nat'l<br />
Gypsum Co., 139 B.R. 397 (N.D. Tex. 1992).<br />
<br />
Whether, at the time of bankruptcy, the claimant could<br />
have ascertained through the exercise of reasonable<br />
diligence that it had such a claim against the debtor. La.<br />
Dep't of Envtl. Quality v. Crystal Oil Co. (In re Crystal Oil<br />
Co.), 158 F.3d 291 (5th Cir. 1998).<br />
3<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 3<br />
Speaker 22: 3<br />
Assessing Claims (cont'd.)<br />
Scheduling Environmental Claims<br />
<br />
<br />
<br />
Effect on government's ability to assert late claims<br />
Government will have a subordinated late claim unless it<br />
can show:<br />
<br />
<br />
(1) inadequate notice or<br />
(2) excusable neglect<br />
Procedure:<br />
<br />
<br />
<br />
(1) motion to allow filing<br />
(2) objection by debtor<br />
(3) hearing and decision by court on whether to allow as a<br />
timely filed claim or treat as a subordinated late claim<br />
4<br />
Claims Estimation<br />
Required Estimation - The court shall estimate for the<br />
purpose of allowance: "any contingent or<br />
unliquidated claim, the fixing or liquidation of<br />
which...would unduly delay the administration of the<br />
case..." 11 U.S.C. 502(c)<br />
<br />
<br />
<br />
The bankruptcy court is bound by the legal rules that<br />
govern the ultimate value of the claim. Addison v.<br />
Langston (In re Brints Cotton Mktg.), 737 F.2d 1338<br />
(5th Cir. 1984).<br />
The bankruptcy court can adopt the estimation<br />
method best suited to the circumstances. Id.<br />
Abuse of discretion standard on appeal.<br />
5<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 4<br />
Speaker 22: 4<br />
Claims Estimation (cont'd.)<br />
Types of Estimation Procedures<br />
<br />
<br />
<br />
<br />
<br />
Ultimate Merits - Claim amount based on the court's best<br />
estimate of the claimant's chances of ultimate success.<br />
Present Probabilities - Claim amount diminished by the<br />
probability that it may be sustainable only in part or not at all.<br />
Forced Settlement - Claim estimated by considering what the<br />
parties would accept in a hypothetical settlement of the dispute.<br />
Market Value - Court attempts to create a hypothetical market for<br />
the claim.<br />
Summary Trial - Mini-trial, with live testimony, witnesses, and<br />
discovery, is used to determine claim's validity and worth.<br />
6<br />
Procedures employed in In re ASARCO LLC<br />
<br />
Four month negotiation to select sites and<br />
establish pre-trial procedures<br />
Twenty sites reflecting $6 billion of the $6.50<br />
billion in environmental claims<br />
<br />
<br />
<br />
Robust discovery and setting deadlines for<br />
expert reports<br />
Court-mandated mediation<br />
Separate order prescribing conduct of<br />
hearing<br />
7<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 5<br />
Speaker 22: 5<br />
Estimation Hearing Procedures<br />
<br />
<br />
<br />
<br />
<br />
Tight timeframes<br />
Pre-filed testimony<br />
Expert driven<br />
Huge range in state of <strong>NRD</strong> assessment among sites<br />
Third-party involvement<br />
<br />
<br />
<br />
<br />
Parent<br />
PRPs<br />
Governments<br />
Committees<br />
8<br />
Settlements<br />
Negotiation<br />
Court Approval<br />
<br />
<br />
Process - On motion and after notice and a hearing, the court<br />
may approve a compromise or settlement. <strong>Fe</strong>d. R. Bankr. P. 9019<br />
Fair and Equitable Standard - Approval must receive the<br />
informed, independent judgment of the bankruptcy court. Factors<br />
to be considered include:<br />
<br />
<br />
<br />
the probability of success in the litigation;<br />
the complexity and duration of litigation and any attendant expense,<br />
inconvenience, or delay (i.e., collecting the judgment); and<br />
all other factors bearing on the wisdom of the compromise, which has<br />
been read to include interests of creditors and whether the settlement<br />
was the product of arms-length bargaining and not fraud or collusion.<br />
9<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 6<br />
Speaker 22: 6<br />
Settlements (cont'd.)<br />
<br />
Court also considered CERCLA standard: whether<br />
settlement is fair, reasonable & consistent with statutory<br />
purposes<br />
<br />
<br />
Procedural fairness: candor, openness, bargaining balance<br />
Substantive fairness: reasonable compromise of litigation<br />
(Cannons Engineering; 899 F.2d at 88-90)<br />
<br />
<br />
Settlements memorialized in consent decrees &<br />
agreements subject to public comment<br />
CERCLA preference for settlement combined with<br />
deference to DOJ’s special expertise and discretion<br />
afforded U.S. Attorney General<br />
10<br />
Management in Context of Large PRP Groups<br />
<br />
Allocation issues<br />
<br />
Understand your sites and watch the filings<br />
<br />
Working with the government in the case<br />
11<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 7<br />
Speaker 22: 7<br />
Example – Coeur d’Alene Basin<br />
<br />
<br />
<br />
Site includes over 150 river miles in watershed<br />
of Coeur d’Alene River & tributaries<br />
Mining operations for over a century produced<br />
over 140 million tons of ore; 72 million tons of<br />
waste<br />
Four days of estimation hearing on $2.56 billion<br />
claim by governments for:<br />
<br />
<br />
<br />
$180 million past response costs<br />
$2.5 billion future response costs<br />
$333 million <strong>NRD</strong><br />
12<br />
Example – Coeur d’Alene Basin<br />
<br />
<br />
<br />
<strong>NRD</strong> claims dwarfed by human health remedy<br />
Prior settlement with state and Indian Tribe<br />
avoided some, but not all trustee issues<br />
Dubious evidence of damages<br />
More fish = more damage ?<br />
<br />
Tundra swans flourishing<br />
13<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 8<br />
Speaker 22: 8<br />
Example - California Gulch<br />
<br />
<br />
<br />
<br />
Extensive mining district site in and around<br />
Leadville, Colorado<br />
Claims by feds. and state totaling $203.4 million,<br />
of which $73.1 million were for <strong>NRD</strong><br />
Other PRP claims as well<br />
Settled all claims for $31.3 million (<strong>NRD</strong> portion<br />
for $10.0 million)<br />
14<br />
Example - California Gulch (cont'd.)<br />
<br />
<br />
<br />
<br />
<br />
Mature human health remedy<br />
Some <strong>NRD</strong>A work performed pre-filing<br />
Bankruptcy accelerated this process<br />
Significant groundwater component subject to<br />
intense challenge<br />
Challenge to settlement keyed on <strong>NRD</strong> award<br />
15<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Linda R. Larson of Marten Law PLLC<br />
J. Scott Janoe of Baker Botts LLP<br />
Speaker 21: 9<br />
Speaker 22: 9<br />
Lessons learned<br />
<br />
<br />
<br />
<br />
<br />
"Maturity" of sites matters<br />
Bankruptcy expedites <strong>NRD</strong> thought process<br />
Limited, but important, opportunities for nondebtor<br />
PRPs to influence process<br />
Mind your trustees<br />
Opportunity to theory test<br />
16<br />
For More Information Contact<br />
Scott Janoe<br />
Linda Larson<br />
Baker Botts L.L.P.<br />
Marten Law<br />
One Shell Plaza<br />
1191 Second Avenue<br />
910 Louisiana Street Suite 2200<br />
Houston, Texas 77002 Seattle, WA 98101<br />
(713) 229-1553 (206) 292-2612<br />
scott.janoe@bakerbotts.com<br />
llarson@martenlaw.com<br />
17<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Settlement of <strong>NRD</strong> Litigation<br />
Allan Kanner, Esq.<br />
Kanner & Whiteley, L.L.C.<br />
New Orleans, LA<br />
Angus Macbeth, Esq.<br />
Sidley Austin LLP<br />
Washington, DC
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 1<br />
Understanding and Protecting Natural Resources<br />
by<br />
Allan Kanner <br />
701 Camp Street<br />
New Orleans, LA 70130<br />
(504) 524-5777 Phone<br />
(504) 524-5763 Fax<br />
a.kanner@kanner-law.com<br />
Law Seminars International<br />
<strong>Santa</strong> <strong>Fe</strong>, New Mexico<br />
July 15-16, <strong>2010</strong><br />
Partner, Kanner & Whiteley, L.L.C., New Orleans, LA; Senior Lecturing <strong>Fe</strong>llow, Duke Law School, and Adjunct<br />
Professor of Law, Tulane Law School, B.A., U. of Pennsylvania, 1975; J.D., Harvard Law School, 1979. The ideas<br />
expressed in this article are the author’s and do not reflect the views of any client.<br />
** The article first appeared in 17 DUKE ENVIRONMENTAL LAW & POLICY FORUM, p. 119 (Fall 2006), and was coauthored<br />
with Mary Ziegler.<br />
© i<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 2<br />
Table of Contents<br />
I. Introduction ..…………………………………………………………………………1<br />
II. Bringing an <strong>NRD</strong> Claim …..……………………………………………...…………..5<br />
A. Who is the Proper Party to File Suit?...…………………………………………...5<br />
1. State Trustees ……………………...…………………………………………..6<br />
2. <strong>Fe</strong>deral Trustees …………………..…………………………...……………..11<br />
3. Overlapping Authority …………..…………………………………………...13<br />
4. Municipal and Local Trustees ..…...…………………………………………16<br />
5. Citizen Suits …………………….………………………………………..…..17<br />
B. Causes of Action …..…………………………………………………………….19<br />
1. State Statutory Causes of Action ………………..…………………………...19<br />
2. Common Law Causes of Action ………………..……………………………21<br />
C. Causation ……………………………………………..………………………….24<br />
D. Injury …………………………………………………..………………………...27<br />
E. Damages ………………………………………………..………………………..29<br />
1. Generally ……………………………………………..……………………….29<br />
a. Restoration ……………………………………….………………………30<br />
b. Compensatory Restoration ……………………….…...………………….30<br />
c. Costs ……………………………………………….…….. ………….......33<br />
2. Valuation ……………………………………………….…………...………...33<br />
F. Defenses …………………………………………………….……………....…....34<br />
1. Statutory Defenses………………………………………………………...…..34<br />
2. Applicability of CERCLA …………………………………………..……..…35<br />
3. <strong>NRD</strong> and Site Remediation are the Same ………………………..…..……….38<br />
4. Preemption of <strong>Fe</strong>deral Law …………….………………………………....…..39<br />
5. Scope of the Public Trust Doctrine …….…………………………………......41<br />
6. Government Contractor Defense ………………………………………...…...43<br />
7. Statutory Immunity…………………………………………………….....…...49<br />
8. Standing to Bring <strong>NRD</strong> Claims ………………………………………..……..52<br />
III. Conclusion ………………………………………………………………………..…….53<br />
© ii<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 3<br />
“Some paintings become famous because, being durable, they are viewed<br />
by successive generations, in each of which are likely to be found a few<br />
appreciative eyes. I know a painting so evanescent that it is seldom<br />
viewed at all, except by some wandering deer. It is a river who wields the<br />
brush, and it is the same river who, before I can bring my friends to view<br />
his work, erases it forever from human view. After that it exists only in my<br />
mind’s eye.” 1<br />
I. INTRODUCTION<br />
Over the years, environmental pollution has spawned a great deal of public and private<br />
litigation and related governmental investigations. One type of claim, however, has seen little<br />
contemporary litigation: claims for natural resource damages (“<strong>NRD</strong>”). The relative dearth of<br />
<strong>NRD</strong> claims being pursued is unusual given the breadth of available legal theories and the<br />
compelling public interest at stake. The goal of this article is to explain the importance of <strong>NRD</strong><br />
programs and evaluate the process of bringing and defending <strong>NRD</strong> claims in the United States.<br />
A strong <strong>NRD</strong> program benefits society in many diverse ways. Economic enhancement<br />
and increased protection for environmental, recreational and historical interests are but a few<br />
examples 2 . A U.S. Fish & Wildlife Service article espoused the benefits of a strong <strong>NRD</strong><br />
program:<br />
<strong>NRD</strong>AR [Natural Resource Damage Assessment and Restoration Program]<br />
ensures healthy fish and wildlife populations, as well as healthy lands and<br />
waters on which they depend. <strong>NRD</strong>AR ensures healthy wetlands, which<br />
support more species of wildlife than any other habitat type. Wetlands are<br />
especially important to commercial saltwater fish and shellfish. Wetlands<br />
benefit people by providing recreational opportunities, recharging groundwater<br />
supplies, reducing flood damage, and controlling erosion. The economic<br />
benefits of wetland resources are estimated at more than $1 trillion annually.<br />
<strong>NRD</strong>AR benefits the nation’s 35 million anglers, 14 million hunters, and 63<br />
million wildlife viewers who rely on healthy fish and wildlife populations for<br />
their outdoor pursuits. <strong>NRD</strong>AR helps maintain a thriving economy by ensuring<br />
1 ALDO LEOPOLD, A SAND COUNTY ALMANAC (1949).<br />
2 See generally http://www.nj.gov/dep/nrr.<br />
© 1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 4<br />
healthy resources that provide recreational opportunities. Fishing annually<br />
brings in $38 billion; hunting, $21 billion; and wildlife viewing, $27 billion.<br />
These earnings represent about 1.4% of the Gross Domestic Product. <strong>NRD</strong>AR<br />
helps safeguard more than 2 million full- and part-time jobs related to fishing,<br />
hunting, and wildlife viewing. <strong>NRD</strong>AR benefits a nearly $4 billion dollar per<br />
year commercial fishing industry. 3<br />
In addition, property owners and other real estate interests adjacent to restored areas<br />
benefit by removing stigmas that lower property values, promoting economic development and<br />
enhancing the use and enjoyment of property. The establishment of new natural resources, such<br />
as habitats for certain species, might create more development opportunities in other areas over<br />
time. Healthy natural resources are also important to Native American Tribes and help to<br />
maintain “their sovereign rights to land, water, fishing, hunting, and gathering, as well as cultural,<br />
spiritual, and traditional activities that depend on healthy resources.” 4<br />
For all Americans, there<br />
remains a strong desire to leave things better for the next generation.<br />
The overriding public interest in the preservation and reclamation of natural resources is<br />
one of the most important reasons for the development of <strong>NRD</strong> programs. As the nature of the<br />
public interest in natural resources has evolved, so has environmental legislation. The focus of<br />
the first significant environmental laws in the 1950s and 1960s was significantly different than<br />
the present day focus of environmental legislation.<br />
Initially, environmental efforts were<br />
prompted by preservationist ideals -- the desire to maintain the “great” natural resources and save<br />
such sites from exploitation. For example, in the 1960s, the proposed construction of a dam in<br />
the Grand Canyon raised awareness about environmental protectionism - - the need to preserve<br />
the legacy of our nation’s natural resources. Legislation was directed primarily at the behavior<br />
3 U.S. Fish & Wildlife Service, Beyond Cleanup: Restoring American’s Natural Heritage, Jan. 1, 1998, available at<br />
http://www.fws.gov/contaminants/Library.cfm<br />
4 Id.<br />
© 2<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 5<br />
of government agencies, as opposed to private individuals. 5<br />
Congress enacted environmental<br />
legislation in order to “ensure that government agencies respected social and cultural values<br />
when pursuing development projects,” 6 rather than to address the illegal conduct of polluters and<br />
the consequences of their actions.<br />
In effect, we have begun to move from a “great places” approach to natural resources to a<br />
“reclaiming” approach. While a few “great place” battles still continue, such as the effort to<br />
preserve the Arctic Wilderness, today environmental activism and legislation is inspired by the<br />
need to restore and prevent further exploitation of injured and diminishing natural resources such<br />
as the nation’s coastal areas. Environmentalism is motivated less by the need for preservation<br />
and more by the desire for reclamation. People now understand two things about natural<br />
resources. First, natural resources can be salvaged, even in seemingly impossible industrial and<br />
urban locales. The technology and the capacity to reclaim and recreate natural resources have<br />
improved exponentially and will continue to improve. The Meadowlands in New Jersey is a<br />
classic example of this type of transformation potential. 7<br />
Second, people take property rights<br />
5 Robert V. Percival, Environmental <strong>Fe</strong>deralism: Historical Roots and Contemporary Models, 54 MD. L. REv. 1141,<br />
1158 (1995).<br />
6 Id.<br />
7 At one time the world’s largest dump, “[t]he Hackensack Meadowlands is perhaps the largest urban wetland<br />
complex in the northeastern United States. It lies along the Hackensack River and is located within the New York-<br />
Newark metropolitan area. Given this location, the Meadowlands has been greatly impacted by urban and port<br />
development . . . The New Jersey Meadowlands Commission (“NJMC”) is acquiring wetlands and management<br />
rights and making zoning changes . . . in an effort to protect the remaining wetlands. Plans are underway to restore<br />
the Hackensack Meadowlands ecosystem . . . Wetland restoration and enhancement efforts include restoring tidal<br />
flow, removing contaminated soils, creating open water areas, controlling invasive species . . . and regulating water<br />
levels . . . The main hope for the future of Meadowlands wetlands as well as for other urban wetlands is that as many<br />
as possible will be set aside as open space for our benefit and for future generations and that wetland restoration<br />
efforts will be accelerated to revitalize significantly impacted wetlands and to rebuild lost wetlands wherever<br />
practicable. Wetlands are natural resources that, among other things, increase the quality of life for urban residents<br />
across America.” Ralph W. Tiner, John Q. Swords, & Bobbi Jo McLain, Wetland Status and Trends for the<br />
Hackensack Meadowlands, December 2002, available at http://library.fws.gov/Wetlands/Hackensack.pdf.<br />
© 3<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 6<br />
more seriously and also understand that the public’s right to its property or “commons” is<br />
important for both monetary and nonmonetary reasons. 8<br />
Finally, natural resources that were<br />
formerly viewed with little interest or real understanding, such as groundwater, have generated a<br />
special need for attention in light of the crucial role they will play in the future of this country’s<br />
survival. 9<br />
The enactment of the Comprehensive Environmental Compensation, Response and<br />
Liability Act of 1980 (“CERCLA” or “Superfund”) 10 was an attempt by Congress to respond to<br />
the massive pollution and contamination of the environment in the United States. However, as<br />
the past twenty-five years has demonstrated, CERCLA has not been effective in enabling the<br />
recovery of damages for pollution and restoring injured natural resources. 11<br />
In fact, CERCLA<br />
has actually enabled polluters to prolong any meaningful cleanup of natural resources by<br />
permitting them to engage in years of ineffective and mostly useless remediation and feasibility<br />
studies. 12<br />
Moreover, the response time of CERCLA is poor, thus prolonging what is already a<br />
tediously slow road to restoration. 13<br />
The pursuit of <strong>NRD</strong> is the last chance to accomplish what the United States originally<br />
wanted to do with Superfund - - to cleanup the nation’s natural resources and make the polluters<br />
8 See Allan Kanner, The Public Trust Doctrine, Parens Patriae and the Attorney General as the Guardian of the<br />
State’s Natural Resources, 16 DUKE J. ENVTL. L. & POL’Y F. Error! Main Document Only.57, 59 (2005).<br />
Historically, the public “common” was a public area used by villagers for livestock grazing. Additionally, the<br />
villagers had the right to “cut wood, to fish, and to cut peat or turf for fuel.” Id. The common area was used and<br />
regulated by the villagers for purposes of mutual sustainability and benefit.<br />
9 Id.<br />
10 42 U.S.C. §§ 9601-9675.<br />
11 See generally, Allan Kanner, Rethinking Superfund, 20 NAT’L ASS’N ENVTL. PROF’LS NEWS 19 (May-June 1995).<br />
12 Robert W. McGee, Superfund: It’s Time for Repeal After a Decade of Failure, 12 UCLA J. ENVTL. L. & POL’Y<br />
165, 170 (1993).<br />
13 Id. at 169.<br />
© 4<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 7<br />
compensate both the government and the public for the injuries that they have suffered and will<br />
continue to endure. Because our natural resources are being destroyed and disappearing at an<br />
alarming rate, <strong>NRD</strong> litigation has become increasingly important in order to preserve these<br />
natural assets for the public and for future generations.<br />
II.<br />
BRINGING AN <strong>NRD</strong> CLAIM<br />
A. Who is the Proper Party to File Suit?<br />
When an injured natural resource is privately owned, property laws dictate that the owner<br />
of that natural resource is entitled to file suit and recover damages from a potentially responsible<br />
party (“PRP”). In the United States, the Constitution, statutes and common law protect private<br />
property rights. However, when natural resources owned by the public are damaged, questions<br />
arise as to who is entitled to sue for damages on behalf of the public and what type of behavior<br />
constitutes permissible use of public property. For example, an individual’s right to operate a<br />
polluting facility on his private property must be balanced with the public’s right to have a river<br />
adjacent to the property free from contamination. Ultimately, it is the governmental trustees who<br />
have both the responsibility and affirmative obligation to protect natural resources held in trust<br />
for the benefit of the public and to decide when and how to do so.<br />
Natural resource trustees’ responsibilities include assessing the extent of injury to<br />
natural resources and restoring natural resources. In order to execute these<br />
responsibilities, a trustee can negotiate with PRPs to obtain PRP-financed or PRPconducted<br />
assessment and restoration of natural resource injury, sue PRPs for the<br />
costs of assessing and restoring the natural resource, or conduct the assessment<br />
and restore natural resources and then seek reimbursement from PRPs, and, in<br />
limited circumstances, from Superfund. 14<br />
14 Allan Kanner, Tribal Sovereignty and Natural Resource Damages, 25 PUB. LAND & RESOURCES L. REV. 93, 107<br />
(2004).<br />
© 5<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 8<br />
Both the federal and state governments are responsible for protecting and maintaining the natural<br />
resources that fall within their respective jurisdictions. 15<br />
1. State Trustees<br />
Traditionally, states have the responsibility of protecting natural resources for the benefit<br />
of the public. A state may use the common law public trust doctrine and police power authority<br />
to bring suit to recover damages for injured natural resources and to restore the same. 16<br />
These<br />
common law doctrines evolved in recognition of the inherently broad authority states have over<br />
natural resources within their boundaries. For example, in State of Georgia v. Tennessee Copper<br />
Co., United States Supreme Court Justice Oliver Wendell Holmes wrote that “the state has an<br />
interest independent of and behind the titles of its citizens, in all the earth and air within its<br />
domain. It has the last word as to whether its mountains shall be stripped of their forests and its<br />
inhabitants shall breathe pure air.” 17<br />
Accordingly, as the Supreme Court later noted, a state may<br />
assert a claim to protect “the atmosphere, the water, and the forests within its territory,<br />
irrespective of the assent or dissent of the private owners of the land most immediately<br />
concerned.” 18<br />
States exercise police power for the protection of public health and welfare pursuant to<br />
the powers reserved to states by the Tenth Amendment to the United States Constitution. 19<br />
15 In some cases, these rights have been passed to citizens under appropriate circumstances (i.e., through a federal<br />
citizen’s suit or pursuant to a state statute such as New Jersey’s Environmental Rights Act, N.J.S.A. 2A:35A-1, et<br />
seq.).<br />
16 See Kanner, supra note 8.<br />
17 206 U.S. 230 (1907); see also Alfred L. Snapp & Son, Inc. v. Puerto Rico, 458 U.S. 592, 604 (1982).<br />
18 Hudson County Water Co. v. McCarter, 209 U.S. 349, 355 (1908).<br />
19 Similarly, the common law theory of parens patriae is illustrative of states’ power and authority to protect the<br />
interests of its citizens. Through parens patriae suits, states have sought redress for injuries to “quasi-sovereign”<br />
© 6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 9<br />
Through its police power a state may regulate the release of contaminants into the air, 20 protect<br />
the quality of water, 21 control land use through zoning regulations, 22 regulate storage and<br />
disposal of solid and hazardous substances, 23 and protect the public interest in wildlife. 24<br />
The public trust doctrine has its origins in ancient common law. 25<br />
During its early<br />
development in American jurisprudence, the doctrine was used to retain fisheries and land under<br />
interests. These “quasi-sovereign” interests include state interest in its general economy or environment, Late<br />
Corporation of the Church of Jesus Christ of Latter-Day Saints v. United States, 136 U.S. 1, 56 (1890); interstate<br />
water management, Wyoming v. Colorado, 286 U.S. 494, 509 (1932); pollution-free interstate waters, State of<br />
Missouri v. State of Illinois, 180 U.S. 208, 241, (1901); protection of the air and earth from interstate pollutants,<br />
State of Georgia v. Tennessee Copper Co., 206 U.S. at 238; and the general economy of the state, State of Georgia v.<br />
Pennsylvania Railroad Co., 324 U.S. 439, 447 (1945), reh’g denied, 324 U.S. 890 (1945).<br />
20 See, e.g., Northwestern Laundry v. City of Des Moines, 239 U.S. 486 (1916); Lees v. Bay Area Air Pollution<br />
Control District, 48 Cal. Rptr. 295, 299-300 (Cal. Ct. App. 1966)(holding that the regulation of air pollution is<br />
“essential and represents a lawful and proper exercise of the police power); State v. Burns, 591 P.2d 563 (Ariz. Ct.<br />
App. 1979); ARIZ. REV. STAT. § 49-401A (1987).<br />
21 See, e.g., Commonwealth of Pennsylvania v. Barnes and Tucker Company, 319 A.2d 871, 885 (Pa.<br />
1974)(“abatement of water pollution is unquestionably a reasonable exercise of the police power in the abstract”);<br />
Rochez Bros., Inc. v. Commonwealth of Pennsylvania, 334 A.2d 790, 796 (Pa. Commw. Ct. 1975); Morshead v.<br />
California Regional Water Quality Control Board, 119 Cal. Rptr. 586, 589 (Cal. Ct. App. 1975)(holding that<br />
“prevention of water pollution is a legitimate government objective in furtherance of which the police power may be<br />
exercised”).<br />
22 See, e.g., Johnson v. Village of Villa Park, 18 N.E.2d 887, 889 (Ill. 1938)(“Cities and villages have the right to<br />
adopt zoning ordinances as an exercise of their police power and thereby impose a reasonable restraint upon the use<br />
of private property.”); People v. Johnson, 277 P.2d 45, 49 (Cal. Ct. App. 1955)(“[z]oning is inherent in the police<br />
power”); Roselle v. Wright, 122 A.2d 506 (N.J. 1956).<br />
23 See, e.g., Meyers v. Town of Cornwall, 192 N.Y.S.2d 734, 738 (N.Y. 1959)(“a municipality may, in the exercise<br />
of its police power, adopt an ordinance which regulates the collection, storage or disposition of refuse and garbage”);<br />
Department of Transportation v. PSC Resources, Inc., 419 A.2d 1151 (N.J. Super. Ct. Law Div. 1980); State v. Byrd,<br />
708 So. 2d 401, 405 (La. 1998).<br />
24 People v. K. Sakai Co., 128 Cal. Rptr. 536, 539 (Cal. Ct. App. 1976); State v. Stewart, 253 S.E.2d 638, 639 (N.C.<br />
Ct. App. 1979)(“As the State’s wildlife population is a natural resource of the State held by it in trust for its citizens,<br />
the enactment of laws reasonably related to the protection of such wildlife constitutes a valid exercise of the police<br />
power vested in the General Assembly.”); Florida Game and Fresh Water Fish Commission v. Flotilla, Inc., 636 So.<br />
2d 761, 765 (Fla. Dist. Ct. App. 1994); COLO. REV. STAT. § 33-1-101(1) (1986 as amended)(“It is the policy of the<br />
state of Colorado that the wildlife and their environment are to be protected, preserved, enhanced, and managed for<br />
the use, benefit, and enjoyment of the people of this state and its visitors.” )<br />
25 See Kanner, supra note 8.<br />
© 7<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 10<br />
navigable waters in trust for the use and benefit of the public. 26<br />
The public trust doctrine was<br />
first applied in case law pertaining to disputes over navigable waters. These cases began with<br />
the premise that navigable beds, critical to commerce, were owned by the state and held in<br />
common by the state for public use. In the early American case of Home v. Richards, 27 the court<br />
held that the bed of a navigable river within the Commonwealth could not be granted to an<br />
individual. 28<br />
The general scope of the doctrine is well articulated in the seminal United States<br />
Supreme Court case of Illinois Central Railroad Co. v. Illinois:<br />
That the state holds the title to the lands under the navigable waters of Lake<br />
Michigan, within its limits, in the same manner that the state holds title to soils<br />
under tide water, by common law, we have already shown; . . . It is a title held in<br />
trust for the people of the state, that they may enjoy the navigation of the<br />
waters . . . and have liberty of fishing therein . . . The trust devolving upon the<br />
state for the public, and which can only be discharged by the management and<br />
control of property in which the public has an interest, cannot be relinquished by a<br />
transfer of the property. The control of the state for the purposes of the trust can<br />
never be lost . . . 29<br />
Although the public trust began with a more limited focus during an era of relatively<br />
weak environmental understanding, the trend over time has been to expand protection to an<br />
equally broad array of natural resources. Since the doctrine’s first application to navigable beds,<br />
26 Joseph L. Sax, The Public Trust Doctrine in Natural Resource Law: Effective Judicial Intervention, 68 MICH. L.<br />
REV. 471 (1970); V. YANNACONE, B. COHEN & S. DAVIDSON, ENVIRONMENTAL RIGHTS AND REMEDIES 1, § 2:3<br />
(1972).<br />
27 8 Va. (4 Call) 441 (Va. 1798).<br />
28 Over the years, because the doctrine was used in relation to waterways, some confusion arose about the public<br />
trust and its relation to riparians. See, e.g., Groner v. Foster, 27 S.E. 493 (Va. 1897) (emphasizing rights of<br />
riparians in navigable waters); Taylor v. Commonwealth, 47 S.E. 875 (Va. 1904)(reconciling rights of the riparian<br />
with public rights); Commonwealth v. Garner, 44 Va. (3 Gratt.) 655 (Va. Gen. Ct. 1846) (noting that navigable<br />
streams were the property of the Commonwealth, held for the public benefit). Nonetheless, the principle that<br />
government has a proprietary interest in natural resources survived. See, e.g., Toomer v. Witsell, 334 U.S. 385, 408<br />
(1948); Geer v. Connecticut, 161 U.S. 519, 534 (1986), overruled on other grounds by Hughes v. Oklahoma, 441<br />
U.S. 322 (1979).<br />
29 146 U.S. 387, 452-453 (1892)(emphasis added).<br />
© 8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 11<br />
whose import to commerce is obvious, it has been extended to include state trusteeship over<br />
natural resources 30 with little or no commercial value, such as non-navigable waters, 31 and state<br />
parks. 32<br />
Additionally, although the public trust doctrine speaks in terms of duties and not <strong>NRD</strong>,<br />
the nexus between resources that are recognized as being held in trust by the state is their<br />
importance to the general public, aesthetically as well as commercially.<br />
This importance<br />
supersedes the natural resources’ potential value from exploitation by any one individual. More<br />
recent cases have recognized that the trust is active, not passive, and imposes a responsibility on<br />
states to preserve and promote the trust corpus. 33<br />
Thus, a pattern has emerged in which states are<br />
directed to take a more proactive approach in order to fulfill their obligations and responsibilities<br />
with regard to the protection of natural resources.<br />
Recognizing that the state has an important interest in conserving and protecting natural<br />
resources, the doctrine of parens patriae allows the state (in its capacity as “trustee”) to bring<br />
suit to protect those natural resources. This type of suit, recognized in many states, 34 allows the<br />
trustee (state) to sue to make the trust (natural resources) whole, whether by means of restoration<br />
30 The legal fiction of state ownership of natural resources was abandoned in Hughes as being inconsistent with the<br />
Commerce Clause, however, the Supreme Court in that case recognized the important interest at stake. The<br />
Supreme Court stated, “We consider the States’ interests in conservation and protection of wild animals as<br />
legitimate local purposes similar to the States’ interests in protecting the health and safety of their citizens.” Hughes,<br />
441 U.S. at 337.<br />
31 See National Audubon Society v. Superior Court of Alpine County, 658 P.2d 709 (Ca. 1983), cert. denied, 464<br />
U.S. 977 (1983).<br />
32 See Sax, supra n. 26, at 485; Davenport v. Buffington, 97 F. 234 (8th Cir. 1899); Gould v. Greylock Reservation<br />
Commission, 215 N.E.2d 114 (Mass. 1966).<br />
33 See, e.g., National Audubon Society, 658 P.2d at 724-725; City of Milwaukee v. State, 214 N.W. 820 (Wis. 1927).<br />
34 See, e.g., Maine v. M/V Tamano, 357 F. Supp. 1099 (D. Me. 1973); Department of Natural Resources v.<br />
Amerada Hess, 350 F. Supp. 1060, 1067 (D. Md. 1972); Department of Fish & Game v. S.S. Bournemouth, 307 F.<br />
Supp. 922, 925 (C.D. Cal. 1969); Department of Envtl. Protection v. Jersey Cent. Power & Light Co., 336 A.2d<br />
750, 759 (N.J. Super. Ct. App. Div. 1975), rev’d on other grounds, 351 A.2d 337 (N.J. 1976); State v. Bowling<br />
Green, 313 N.E.2d 409, 411 (Ohio 1974); State Department of Fisheries v. Gillette, 621 P.2d 764, 766-67 (Wash. Ct.<br />
App. 1980).<br />
© 9<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 12<br />
or compensation. Despite the fact that many states have no case law directly addressing a state’s<br />
parens patriae authority to sue, there is no evidence that any state has deemed the principle of<br />
parens patriae not to be a part of the state’s law. Furthermore, many state constitutions, such as<br />
Louisiana, impose upon the state a duty to protect the environment. 35<br />
A somewhat analogous common law doctrine available to redress <strong>NRD</strong> is the doctrine of<br />
public nuisance. Public nuisance is defined as “an unreasonable interference with the rights<br />
common to the general public;” it is “a substantial interference with the public health, the public<br />
safety, the public peace, the public comfort or the public convenience . . . ” 36 Moreover, it is not<br />
necessary that the individual be actually harmed. 37 Monetary damages for public nuisance,<br />
however, are not available. Depending on the jurisdiction, public nuisance may be statutorily<br />
defined, but nonetheless be available at common law. 38<br />
In a sense, the public trust doctrine and the public nuisance doctrine operate under the<br />
same principle. Both protect interests of the public in natural resources. The public trust<br />
doctrine protects natural resources held for all. Public nuisance protects those held by no one. In<br />
the case of United States v. Luce, the United States, as operator of a quarantine station for<br />
immigrants waiting to enter the country, brought a public nuisance action against a neighboring<br />
35 LA. CONST. art. IX, § 1; see also PA. CONST. art I, § 27; FLA. CONST. art. X, § 11; HAW. CONST. art. XII, § 4<br />
36 RESTATEMENT (SECOND) OF TORTS § 821B (Tentative Draft No. 17, 1974).<br />
37 Chicago v. Gunning System, 73 N.E. 1035 (Ill. 1905)(holding that the fact that landowners had not been injured is<br />
not a defense).<br />
38 See, e.g., Commonwealth of Pennsylvania v. Barnes and Tucker Company, 319 A.2d 871 (Pa. 1974). The State of<br />
Pennsylvania brought an action in equity to require the owner of closed mine to treat acid mine drainage that was<br />
discharging from the mine. The state asserted claims based on statutory and common law public nuisance. The<br />
court held that “[t]he third and fourth based upon which the Commonwealth claims relief should be granted are the<br />
doctrines of statutory and common law public nuisances. We find that relief may be granted under either of these<br />
theories.” Id. at 880.<br />
© 10<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 13<br />
fish factory. 39<br />
The government sought an injunction against the factory to abate foul smells that<br />
were making the quarantined individuals sick. 40 The court granted relief, enjoining the nuisance,<br />
in spite of the equitable right of the defendant. 41<br />
From this case, one can see the interaction of the public trust doctrine and public nuisance<br />
claims and their applicability to <strong>NRD</strong> with regard to the ability to file suit. In Luce, the court<br />
recognized that the United States had a responsibility to the quarantined individuals under its<br />
care. 42<br />
This responsibility is analogous to the responsibility of the government to protect natural<br />
resources which are held under its care for the common good. The Luce court also allowed the<br />
government to sue prospectively to stop an activity that was harming those under its care. 43<br />
Similarly, the government should be able to sue prospectively to protect natural resources under<br />
its care from damage, or, if the damage has already occurred, sue on behalf of the trust to recover<br />
compensation for injury.<br />
2. <strong>Fe</strong>deral Trustees<br />
Pursuant to the public trust doctrine, as first discussed by the United States Supreme<br />
Court in Martin v. Waddell, “when the revolution took place, the people of each state became<br />
themselves sovereign; and in that character hold the absolute right to all their navigable waters,<br />
and the soils under them, for their own common use, subject only to the rights since surrendered<br />
39 141 F. 385 (C.C.D. Del. 1905).<br />
40 Id. at 390.<br />
41 Id. at 422-423.<br />
42 Id. at 419.<br />
43 Id. at 422-23.<br />
© 11<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 14<br />
by the constitution to the general government.” 44<br />
On the contrary, there is no inherent right held<br />
by the federal government to act as trustee over natural resources. Historically, in order to<br />
pursue <strong>NRD</strong>, the federal government has been limited to actions permitted by legislative<br />
mandates that confer upon it trustee status over natural resources. 45<br />
Despite this fact, the federal<br />
government has managed to carve out a significant role as trustee in the pursuit of <strong>NRD</strong> claims.<br />
A variety of environmental legislation confers trustee status upon the federal government<br />
and its agencies.<br />
CERCLA, 46 the Oil Pollution Act (“OPA”) 47 and the Clean Water Act<br />
(“CWA”) 48 all permit the designation of both federal and state trustees to pursue <strong>NRD</strong> claims.<br />
The statutes do not identify specific trustees; however, particular trustees may be designated by<br />
other means. For example, pursuant to CERCLA, Executive Order 12580 and the amendment<br />
thereto designates certain federal trustees to implement the statute, including the Departments<br />
and Secretaries of State, Defense, Justice, Interior, Agriculture, Commerce, Labor, Health and<br />
Human Services, Transportation, Energy and the Environmental Protection Agency. 49<br />
One of the biggest problems associated with federal trustees is that they are not bound by<br />
any specific rules or principles requiring them to balance public interests - - a fact that can give<br />
rise to actions by federal trustees that are inconsistent with the fiduciary nature of trusteeship.<br />
“Instead of holding federal statutory <strong>NRD</strong> trustees to a strict fiduciary duty, courts have granted<br />
44 41 U.S. 367, 410 (1842).<br />
45 Laura Rowley, <strong>NRD</strong> Trustees: To What Extent Are They Truly Trustees? 28 B.C. ENVTL. AFF. L. REV. 459 (2001).<br />
46 42 U.S.C. § 9607(f)(1).<br />
47 33 U.S.C. § 2706(b).<br />
48 42 U.S.C. § 1321(f)(5).<br />
49 See Exec. Order No. 12580, 52 <strong>Fe</strong>d. Reg. 2923 (Jan. 29, 1987) and No. 13016, 61 <strong>Fe</strong>d. Reg. 45871 (Aug. 28,<br />
1996)); see also 40 C.F.R. § 300.600 et seq.<br />
© 12<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 15<br />
them agency deference.” 50<br />
Such inconsistency with principles of trusteeship and fiduciary duties<br />
is evidenced in cases where the trustee does not spend all monies recovered for <strong>NRD</strong> to restore<br />
or recreate the injured natural resource. 51<br />
While a trustee’s decision to not spend any monies<br />
recovered on the restoration of the damaged natural resource clearly violates the duties imposed<br />
upon federal agents as trustees, the most minimal restoration efforts seem to “satisfy” a trustee’s<br />
fiduciary duty despite the fact that the natural resource remains polluted. 52<br />
As a result, the public,<br />
as the beneficiary of the trust, is deprived of the full use and benefit of the natural resource and is<br />
left with no other recourse since damages have already been recovered for the natural resource’s<br />
injury.<br />
3. Overlapping Authority<br />
Since federal trusteeship is derived from a number of overlapping federal statutes, more<br />
than one federal trustee will likely be involved at a given site, and overlaps with state and Indian<br />
tribe trustees frequently occur as well. The Superfund Amendments and Reauthorization Act of<br />
1986 (“SARA”), which amended CERCLA, requires the EPA to notify trustees of possible<br />
natural resource impacts and to coordinate its investigatory work with the trustees. 53<br />
Despite this<br />
fact, an initial obstacle in the pursuit of <strong>NRD</strong> is the coordination of trustee activities at a given<br />
site and the determination of which trustee, if any, will be the lead.<br />
50 Rowley, supra note 45, at 486.<br />
51 “The best example of the futility in trying to identify where an <strong>NRD</strong> trustee has violated the bounds of the<br />
statutory authority, and thus violated its fiduciary duty, is found in the case of the 1989 Exxon Valdez oil spill. The<br />
Spill Trustee Council recovered nine hundred million dollars from the settlement of a suit under the CERCLA and<br />
CWA <strong>NRD</strong> provisions. Due to the magnitude of the disaster, the Spill Trustee Council used the money for a variety<br />
of purposes, but it is unclear whether all the uses were for the end result of natural resource restoration.” Id. at 487.<br />
52 Id. at 486.<br />
53 See 42 U.S.C. § 9604(b)(2).<br />
© 13<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 16<br />
The construction of federal environmental laws seems to indicate that particular natural<br />
resources are the responsibility of the federal government and other natural resources fall within<br />
the ambit of state responsibility. 54<br />
However, the language utilized in these statutes fails to clarify,<br />
for instance, whether natural resources located on federally-owned property belong to the federal<br />
government or the state wherein the property is located. 55<br />
One of the primary problems with<br />
regard to multiple trustees is linking the contamination problem of a particular resource to a<br />
particular trustee. For example, the Department of the Interior (“DOI”) and the Department of<br />
Commerce both have trustee status with regard to the protection of migratory birds. 56<br />
As a result,<br />
a state may share trustee status over natural resources when there has been an injury to migratory<br />
birds stemming from the contamination of wetlands. 57<br />
Presumably, the federal government may<br />
recover damage to the birds, while the state trustee may recover damages for injury to the<br />
wetlands, however, due to the principles prohibiting a double recovery for <strong>NRD</strong>, the two trustees<br />
are precluded from both recovering for the birds and the wetlands.<br />
While there are more attempts at coordination now, overlapping trustee authority still<br />
inhibits action. At some sites, parties have been unable to achieve prompt resolution of <strong>NRD</strong><br />
issues at the time that remedial issues are being settled with the EPA or a state, due to the need<br />
for multiple trustee signoffs. The difficulty of resolving overlapping jurisdictional issues is<br />
54 Marc G. Laverdiere, Natural Resource Damages: Temporary Sanctuary for <strong>Fe</strong>deral Sovereign Immunity, 13 VA.<br />
ENVTL. L. J. 589, 592 (1994)(“For example, under CERCLA, liability for damaging these resources is ‘to the United<br />
States Government and to any State for natural resources within the State or belonging to, managed by, controlled<br />
by, or appertaining to such State.’”).<br />
55 Id.<br />
56 Thomas L. Eggert & Kathleen A. Chorostecki, Rusty Trustees and the Lost Pots of Gold: Natural Resource<br />
Damage Trustee Coordination Under the Oil Pollution Act, 45 BAYLOR L. REV. 291, 305 (1993).<br />
57 Id.<br />
© 14<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 17<br />
evidenced in United States v. Asarco, Inc., in which the plaintiffs, the United States, the Coeur<br />
d’Alene Tribe of Idaho and the State of Idaho filed suit pursuant to CERCLA and the CWA for<br />
injury to natural resources in northern Idaho resulting from the defendants’ mining activities. 58<br />
A number of defendants moved for summary judgment, asserting that a settlement agreement<br />
they had entered into with the State of Idaho precluded recovery by the Tribe or the United<br />
States. 59<br />
The United States argued that the State of Idaho did not have the authority to settle the<br />
federal government’s claims regarding the same natural resources. 60<br />
The court agreed with the<br />
United States, stating “CERCLA does not give the state an exclusive right to bring a natural<br />
resource damages action if the state files the first lawsuit claiming natural resource damages and<br />
CERCLA does not prohibit more than one potential trustee from bringing a natural resource<br />
damages action.” 61<br />
The court’s decision that the record was insufficient to establish “the scope<br />
of trusteeship of the plaintiff over the land and water at issue . . . [and] a more extensive factual<br />
record needs to be reviewed regarding whether or not USA was in privity with the State and/or<br />
the Tribe when the settlement agreements were entered with the defendants” demonstrates that<br />
the occurrence of overlapping trustee authority is not an issue that can easily be resolved. 62<br />
The overlap of trustee authority also underscores the differences by which various federal<br />
trustees and their state or Indian tribe counterparts value <strong>NRD</strong> injuries and consider early dollar<br />
settlements. All trustees will place a different value on the same natural resource. For instance,<br />
natural resources may hold cultural or spiritual worth for an Indian tribe that are not considered<br />
58 1998 WL 1799392, No. CV 96-0122-N-EJL, CV 91-342-N-EJL (D. Idaho March 31, 1998).<br />
59 Id. at *5.<br />
60 Id.<br />
61 Id.<br />
62 Id.<br />
© 15<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 18<br />
by the state or federal government when valuing those resources for purposes of calculating<br />
damages. Similarly, a state’s loss of revenue derived from fishing licenses would not necessarily<br />
be a consideration by the federal government when valuing the loss of a river to pollution.<br />
4. Municipal and Local Trustees<br />
Although the federal government, state government and Indian tribes are empowered to<br />
recover <strong>NRD</strong>, prior to the SARA Amendments to CERCLA, courts broadly read the <strong>NRD</strong><br />
provision of the statute as granting municipalities standing to pursue <strong>NRD</strong> claims. 63<br />
However,<br />
with the enactment of the amendments, courts’ interpretation of a municipality drastically<br />
changed:<br />
As originally enacted, CERCLA called for authorized representatives of the<br />
state to act as natural resource trustees but did not outline a procedure for<br />
appointing such trustees. Under SARA, the governor of each state was charged<br />
with choosing an official to act on the public’s behalf as trustee and to assess<br />
damage to natural resources . . . [T]his change turned out to be significant to the<br />
courts dealing with standing for municipalities. The courts interpreted this<br />
trustee-appointing mechanism to be the only way a municipality could be a<br />
natural resource trustee under CERCLA. 64<br />
In Mayor and Council of the Borough of Rockaway v. Klockner & Klockner, the<br />
municipality filed suit under CERCLA for recovery of costs associated with the defendants’<br />
contamination of groundwater wells. 65<br />
The court ultimately determined that the SARA<br />
amendments had “clarified” the issue of standing with regard to CERCLA claims, stating that<br />
“only a ‘state official,’ specifically appointed by the governor of the state, may be an ‘authorized<br />
representative’ for purposes of bringing an action to recover for natural resource damages.<br />
63 Mayor and Board of Aldermen of the Town of Boonton v. Drew Chemical Corporation, 621 F. Supp. 663, 667<br />
(D.N.J. 1985).<br />
64 Michael J. Wittke, Municipal Recovery of Natural Resource Damages Under CERCLA, 23 B.C. ENVTL. AFF. L.<br />
REV. 921, 929 (1996).<br />
65 811 F. Supp. 1039 (D.N.J. 1993).<br />
© 16<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 19<br />
SARA thus confirms Congress’ intent that Section 107(f) inure only to the benefit of the states<br />
and not their political subdivisions.” 66<br />
Courts have reached a similar finding as to the standing<br />
of a municipality when a state statute is comparable or analogous to CERCLA. 67<br />
Municipalities,<br />
however, are not completely deprived of standing in the context of <strong>NRD</strong>. If a municipality<br />
wishes to recover <strong>NRD</strong> under CERCLA or a similar state statute, it may still seek designation as<br />
“trustee” by the state. In the alternative, municipalities may seek <strong>NRD</strong> by asserting common law<br />
claims. 68 5. Citizen Suits<br />
As noted earlier in the article, an individual who owns a natural resource has standing as<br />
a property owner to file suit to recover for any <strong>NRD</strong>. However, a private party’s capability of<br />
filing suit to recover damages for publicly owned natural resources is severely limited. One of<br />
the only avenues by which a private citizen or entity may pursue a claim for injury to publiclyowned<br />
natural resources is through a citizen suit. 69<br />
At the federal level, citizen suits generally<br />
occur in one of three contexts:<br />
66 Id. at 1049; see also Town of Bedford v. Raytheon Company, 755 F. Supp. 469, 472-473 (D. Mass. 1991); City of<br />
Toledo v. Beazer Materials and Services, Inc., 833 F. Supp. 646, 652 (N.D. Ohio 1993); Borough of Sayreville v.<br />
Union Carbide Corporation, 923 F. Supp. 671, 681 (D.N.J. 1996).<br />
67 City of Portland v. Boeing Company, 179 F. Supp. 2d 1190, 1202 (D. Or. 2001); The Consolidated City of<br />
Indianapolis v. Union Carbide Corporation, 2003 WL 22327832, No. 1:02-cv-1340-LJM-WTL, *3 (S.D. Ind. Oct.<br />
8, 2003).<br />
68 Peter H. Lehner, Act Locally: Municipal Enforcement of Environmental Law, 12 STAN. ENVTL. L. J. 50, 75 (1993).<br />
69 “All major environmental laws, specifically the Clean Air Act, the <strong>Fe</strong>deral Water Pollution Control Act,<br />
commonly known as the Clean Water Act, the Resource Conservation and Recovery Act, and the Comprehensive<br />
Environmental Response, Compensation and Liability Act, as well as a host of less well known environmental laws,<br />
such as the Toxic Substances Control Act, and the Surface Mining Control and Reclamation Act, contain essentially<br />
the same citizen suit provisions. They all trace their origin to section 304 of the Clean Air Act.” Robert D. Snook,<br />
Environmental Citizen Suits and Judicial Interpretation: First Time Tragedy, Second Time Farce, 20 W. NEW ENG.<br />
L. REV. 311, 313-314 (1998).<br />
© 17<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 20<br />
(1) suits brought by private citizens against persons alleged to be in violation of a<br />
federal environmental law; (2) suits brought by private citizens against the<br />
executive branch of the federal government, typically the Environmental<br />
Protection Agency (EPA) alleging that the federal government has failed to<br />
perform a nondiscretionary duty in implementing an environmental law; or (3)<br />
suits brought by private citizens against a federal agency directed at the agency’s<br />
own polluting activities. 70<br />
Because citizen suits are brought to vindicate rights held by the public, private<br />
individuals who pursue claims under these provisions do not have the same rights and relief as<br />
those afforded under private causes of action. 71<br />
In addition, under the natural resource<br />
provisions of federal laws, individual plaintiffs are precluded from recovering <strong>NRD</strong>. 72<br />
Thus,<br />
individual plaintiffs may file a citizen suit to compel a trustee to seek <strong>NRD</strong>; however, such<br />
plaintiffs may not recover <strong>NRD</strong>.<br />
Likewise, some state statutes may also have similar citizen suit provisions that permit<br />
individuals to file actions for environmental contamination. The New Jersey Environmental<br />
Rights Act (“ERA”), 73 for example, permits an individual to file an action against “any other<br />
person alleged to be in violation of any statute, regulation or ordinance which is designed to<br />
prevent or minimize pollution, impairment or destruction of the environment” for injunctive or<br />
equitable relief. 74<br />
The ERA, however, does not “confer any substantive rights . . . Rather, it<br />
70 Shay S. Scott, Combining Environmental Citizen Suits & Other Private Theories of Recovery, 8 J. ENVTL. L. &<br />
LITIG. 369, 372 (1994).<br />
71 Id. at 378. (“They thus do not include toxic tort suits for personal injury or property damage. They also do not<br />
include private suits for the personal losses suffered when public resources are damaged; for example, they do not<br />
include suits by fishermen when public fisheries are damaged by pollution. While losses to people from pollution<br />
are important, they are different from the losses to the environment itself.”).<br />
72 See, e.g., In re Burbank Environmental Litigation, 42 F. Supp. 2d 976, 980 (C.D. Cal. 1998)(“Under CERCLA,<br />
only natural resource trustees acting on behalf of the federal government, the state, and certain Indian tribes may<br />
bring an action for damage to natural resources.”).<br />
73 N.J.S.A. 2A:35A-1 et seq.<br />
74 N.J.S.A. 2A:35A-4.<br />
© 18<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 21<br />
grants private plaintiffs standing to enforce other New Jersey environmental statutes ‘as an<br />
alternative to inaction by the government which retains primary prosecutorial responsibility.’” 75<br />
Under the ERA, a citizen may file suit to compel the government to act to recover environmental<br />
damages, however, the citizen may not personally seek damages. Although citizen suits may be<br />
a useful tool in compelling government action, they may not be used to recover <strong>NRD</strong> - - the<br />
power to bring actions to recover <strong>NRD</strong> is vested solely with governmental trustees.<br />
B. CAUSES OF ACTION<br />
1. State Statutory Causes of Action<br />
In addition to <strong>NRD</strong> actions brought pursuant to federal laws, states may also bring<br />
actions under state statutes. It follows that if a state may sue on behalf of its natural resources, it<br />
may also legislate to protect them or provide for compensation in the event they are lost or<br />
destroyed. Accordingly, some forty-five states provide a public cause of action for damage to<br />
natural resources. 76<br />
These statutes vary widely in scope. New York’s statute, for example, applies only to<br />
criminal violations; 77 the laws of Maine and Massachusetts apply only to oil spills. 78 The most<br />
comprehensive of these statutes arguably are those of California and Minnesota. California’s<br />
75 Klockner & Klockner, 811 F. Supp. at 1054 (quoting Superior Air Products Company v. NL Industries, Inc., 522<br />
A.2d 1025, 1032 (N.J. Super. App. Div. 1987)).<br />
76 See William S. Roush, Jr., 2 TOXIC TORTS. PRAC. GUIDE § 25.11 (2005). For example, in Com. of Puerto Rice v.<br />
S.S. Zoe Colocotroni, 628 F.2d 652 (1st Cir. 1980), a Puerto Rican statute provided the basis for assessing damages<br />
for the discharge of oil. In that case, the circuit court stated, “where the Commonwealth of Puerto Rico has thus<br />
legislatively authorized the bringing of suits for environmental damages, and has earmarked funds so recovered to a<br />
special fund, such an action must be construed as taking the place of any implied common law action the<br />
Commonwealth as trustee, might have brought.” Id. at 672.<br />
77 See N.Y. Envtl. Conserv. Law. § 71-2723 (McKinney 1981).<br />
78 See, e.g., Maine Oil Discharge Prevention and Pollution Control Act, ME. REV. STAT. ANN. tit. 38 § 551 (1978);<br />
Massachusetts Rules for the Prevention and Control of Oil Pollution in the Waters of the Commonwealth § 9.02<br />
(1973).<br />
© 19<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 22<br />
statute provides liability for “any damage or injury to the natural resources of the state, including,<br />
but not limited to, marine and wildlife resources, caused by the discharge or leakage of<br />
petroleum, fuel oil, or hazardous substances.” 79<br />
Minnesota’s statute holds any discharger of<br />
hazardous substances liable for “[a]ll damages for any injury to, destruction of or loss of natural<br />
resources.” 80<br />
A summary of these statutes indicates that most are aimed at protecting the natural<br />
resources under the public trust. However, when definitions of natural resources are too narrow,<br />
there are resulting limitations on the recovery of <strong>NRD</strong>. Accordingly, these statutes suffer some<br />
of the same problems as the public trust relative to the scope of natural resources protected.<br />
Even the most comprehensive statutes limit recovery to hazardous substance damage. The issue<br />
of scope is one of the greatest limitations on the recovery <strong>NRD</strong>. Thus, the question then follows:<br />
how should this problem be addressed?<br />
New Jersey has managed to overcome the problem of scope by broadly defining natural<br />
resources in its Spill Compensation and Control Act (“Spill Act”). “Natural resources” are<br />
broadly defined as “all land, fish, shellfish, wildlife, biota, air, waters and other such resources<br />
owned, managed, held in trust or otherwise controlled by the State.” 81 Indeed, among the various<br />
state laws protecting natural resources, New Jersey has one of the most potent. The New Jersey<br />
Department of Environmental Protection is authorized by statute to commence civil actions for<br />
the “cost of restoration and replacement, where practicable, of any natural resource damaged or<br />
79 CAL. HARB. & NAV. CODE § 293 (West Supp. 1989).<br />
80 MINN. STAT. ANN. § 115B.04 (1)(c) (West 1985).<br />
81 N.J.S.A. 58:10-23.11b.<br />
© 20<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 23<br />
destroyed by a discharge.” 82 By enacting the Spill Act, the New Jersey Legislature intended to<br />
create additional remedies to protect the environment and compensate the public. The absolute<br />
liability provisions of the law are especially noteworthy. Defining natural resources to broadly<br />
encompass a wide variety of resources has proven to be successful in addressing the problem of<br />
scope with regard to any limitations upon <strong>NRD</strong> recovery.<br />
2. Common Law Causes of Action<br />
In addition to available statutory causes of action, state governments may pursue<br />
common law causes of action to recover for <strong>NRD</strong>. 83<br />
To protect or sometimes compensate a<br />
natural resource held in common, the state may sue in its trustee capacity. In the case of natural<br />
resources held by no one, the state may sue to enjoin under a public nuisance theory. Such<br />
causes of action are especially useful to close the gap where federal statutes do not provide<br />
adequate relief. 84<br />
Public nuisance actions, for example, were traditionally used to obtain injunctive relief,<br />
enjoining certain behavior deemed to constitute an “unreasonable interference with a right<br />
common to the general public.” 85<br />
Courts have increasingly held, however, that a state may<br />
utilize public nuisance actions to recover response costs incurred in the abatement of such a<br />
82 N.J.S.A. 58:10-23.11u.b(4).<br />
83 For a more detailed discussion, see generally, Kanner, supra note 8.<br />
84 <strong>Fe</strong>deral statutes are sometimes less desirable than other theories with regard to the recovery of <strong>NRD</strong>. CERCLA,<br />
for example, has more defenses and involves a slow and rigid process, thus state law theories are often better.<br />
Furthermore, a plaintiff may recover more damages bringing common law claims, rather than brining an action<br />
under CERCLA.<br />
85 RESTATEMENT (SECOND) TORTS § 821B (1979).<br />
© 21<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 24<br />
nuisance. 86<br />
If the state would like to recover for a pecuniary loss arising from contamination of<br />
a natural resource, however, it must allege a “special injury.” 87<br />
In New Mexico v. General<br />
Electric Company, the court discussed what constitutes a “special injury”:<br />
To satisfy the “special injury” requirement in this case and establish any<br />
entitlement to compensatory damages on their common-law public nuisance claim,<br />
the Plaintiffs must show that the State has suffered some discrete physical harm or<br />
pecuniary loss apart from the more generalized injury to the public’s interest that<br />
results from the public nuisance . . . Absent proof of some discrete “special<br />
injury” to the State’s interest apart from the injury to the public’s interest in<br />
unappropriated groundwater, Plaintiffs may be limited to equitable relief seeking<br />
the abatement of the claimed nuisance. 88<br />
New Jersey, in particular, has a rich common law tradition with respect to the imposition<br />
of liability for environmental injuries and the development of comprehensive and effective<br />
remedies. 89<br />
The common law has continued to develop despite the enactment of statutory law on<br />
both the federal and state levels addressing environmental liabilities. State v. Ventron makes<br />
clear that common law remedies remain available notwithstanding collateral or supplementary<br />
86 Town of East Troy v. Soo Line Railroad Company, 653 F.2d 1123, 1132 (7th Cir. 1980)(permitting recovery of<br />
expenses incurred cleaning up groundwater contamination); State of New York v. Shore Realty Corporation, 759<br />
F.2d 1032, 1043 n. 14 (noting in dicta that “New York law appears to provide the State with restitution costs in a<br />
public nuisance action.”); Camden County Board of Chosen Freeholders v. Beretta U.S.A. Corporation, 123 F. Supp.<br />
2d 245 (D.N.J. 2000) (“This Court agrees that for abatement of a public nuisance, New Jersey law permits cost<br />
recovery.”)<br />
87 New Mexico v. General Electric Company, 335 F. Supp. 2d 1185, 1239 (D.N.M. 2004).<br />
88 Id. at 1240-1241; see also Selma Pressure Treating Company v. Osmose Wood Preserving Company of America,<br />
Inc., 271 Cal. Rptr. 596 (Cal. Ct. App. 1990), the court held that “the State, acting in its capacity as property owner,<br />
and not merely in its representative capacity, can seek damages as well as injunctive relief . . .” Id. at 603. The<br />
court went on to determine that “the State does have a legally cognizable interest in the ground waters affected here<br />
which suffice to support a claim for damages.” Id. at 606.<br />
89 New Jersey’s proactive and continuous use of the common law in <strong>NRD</strong> recovery actions provides a valuable<br />
template for other states to utilize in their own <strong>NRD</strong> actions.<br />
© 22<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 25<br />
statutory remedies. 90 Ventron also provides a comprehensive discussion of the history of New<br />
Jersey law on these remedies 91 and specifically notes that:<br />
[T]oxic wastes are “abnormally dangerous,” and the disposal of them, past or<br />
present, is an abnormally dangerous activity. We recognize that one engaged in<br />
the disposing of toxic waste may be performing an activity that is of some use to<br />
society. Nonetheless, “the unavoidable risk of harm that is inherent in it requires<br />
that it be carried on at his peril rather than at the expense of the innocent person<br />
who suffers harm as a result of it.” 92<br />
The Ventron decision set forth what has become a founding principle in the development<br />
of environmental common law in New Jersey: “Those who poison the land must pay for its<br />
cure. ”93 In light of this principle, the New Jersey courts have emphasized that their primary<br />
concern in resolving environmental cases is to do so with underlying considerations of<br />
“reasonableness, fairness and morality” rather than the “formulary labels” which might be<br />
attached to particular causes of action. 94<br />
In addition to strict liability, other traditional tort<br />
theories remain viable. Nuisance, 95 trespass, 96 negligence, 97 and fraud 98 have all been<br />
90 State, Department of Environmental Protection v. Ventron Corp., 468 A.2d 150 (N.J. 1983).<br />
91 Id. at 157.<br />
92 Id. at 160 (quoting RESTATEMENT (SECOND) TORTS § 520 cmt. h, at 39 (1977)). Cases subsequent to Ventron<br />
have held that whether pollution activity is a basis for direct liability is to be determined on a case-by-case approach<br />
following the Restatement principles. See T & E Industries Inc. v. Safety Light Corporation, 546 A.2d 570 (N.J.<br />
Super. Ct. App. Div. 1988), aff’d as modified, 587 A.2d 1249 (N.J. 1991); Kenney v. Scientific, Inc., 497 A.2d 1310<br />
(N.J. Super. Ct. Law Div. 1985).<br />
93 Ventron, 468 A.2d at 160.<br />
94 T & E Industries Inc., 546 A.2d at 577(quoting Berg v. Reaction Motors Div., Thiokol Chemical Corp., 181 A.2d<br />
487 (N.J. 1962)); Kenney v. Scientific, Inc., 497 A.2d at 1324.<br />
95 Ventron, 468 A.2d at 157-158, overruling Marshall v. Welwood, 38 N.J.L. 339 (N.J. 1876); But see Kenney, 497<br />
A.2d at 1324.<br />
96 Ventron,, 468 A.2d at 158.<br />
97 Kenney, 497 A.2d at 1324, 1328.<br />
98 Ventron, 468 A.2d at 166.<br />
© 23<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 26<br />
successfully asserted in New Jersey environmental cases. Punitive damages are available in<br />
environmental actions involving deliberate acts or omissions committed with the knowledge of a<br />
high degree of probability of harm, reckless indifference to consequences, or where there has<br />
been “such a conscious and deliberate disregard of the rights of others that his conduct may be<br />
called willful or wanton.” 99<br />
Indeed, state statutory limitations on the availability of punitive<br />
damages have specifically excluded “environmental torts.”<br />
C. CAUSATION<br />
When a common law claim for <strong>NRD</strong> is brought, a plaintiff must prove causation with<br />
respect to the claim as required by the common law. When a trustee brings <strong>NRD</strong> claims under<br />
federal legislation, the degree of causation must be gleaned from the statute. If the statute does<br />
not specify the standard of proof necessary for causation, it is left to the courts to determine what<br />
is required. In both cases, causation is not an especially difficult hurdle. The causation<br />
requirement ensures that the conduct complained of is appropriately linked to the wrong<br />
claimed-the natural resource injury, nuisance or trespass.<br />
CERCLA, for example, does not specify the standard of proof necessary for showing that<br />
a particular discharge or release caused a particular injury to a <strong>NRD</strong> trustees seeking restoration<br />
under §107(a)(4)(c) must prove injury to natural resources “resulting from” a release of a<br />
hazardous substance. Courts have generally required only a minimal connection between the<br />
responsible party and the response costs incurred in connection with a release. 100<br />
99 Id.<br />
100 See, e.g., Dedham Water Co. v. Cumberland Farms Dairy, Inc., 889 F.2d 1146 (1st Cir. 1989).<br />
© 24<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 27<br />
In Ohio v. DOI, the D.C. Circuit held that CERCLA was ambiguous as to the standard of<br />
causation to be applied in determining whether a hazardous substance release caused a particular<br />
injury. 101<br />
The court concluded that DOI’s position that the traditional common law standard of<br />
causation should be applied was a permissible reading of the statute. 102 Consequently, trustees<br />
must be able to meet traditional causation standards when showing that a particular spill or<br />
release caused or, at the very least, was a “contributing factor” to a particular injury. 103<br />
In National Association of Manufacturers v. DOI, the court stated “CERCLA is<br />
ambiguous on the precise question of what standard of proof is required to demonstrate that<br />
natural resource injuries were caused by, or ‘resulting from,’ a particular release.” 104<br />
The same<br />
court stated in Kennecott Utah Copper Corp. v. DOI that “[w]hile the statutory language requires<br />
some causal connection between the element of damages and the injury - the damages must be<br />
‘for’ an injury ‘resulting from a release of oil or a hazardous substance’ - Congress has not<br />
specified precisely what that causal relationship should be.” 105<br />
This may require proof of a<br />
causal link between the defendant’s release and the injured resource. 106<br />
101 880 F.2d 432, 470 (D.C. Cir. 1989).<br />
102 Id.<br />
103 See, e.g., Coeur D’Alene Tribe v. Asarco, Inc., 280 F. Supp. 2d 1094, 1124 (D. Idaho 2003)(requiring use of<br />
“contributing factor” causation test in <strong>NRD</strong> action by Native American tribe and United States against mining<br />
companies). In Coeur d’Alene Tribe, the court concluded that volumetric tailings production provided a sufficiently<br />
reasonable basis for apportionment to defeat joint and several liability. Id. at 1120-1121.<br />
104 134 F.3d 1095, 1105 (D.C. Cir. 1998)(quoting State of Ohio v. DOI, 880 F.2d at 472).<br />
105 88 F.3d 1191, 1224 (D.C. Cir. 1996).<br />
106 Idaho v. Bunker Hill Co., 635 F. Supp. 665 (D. Idaho 1986).<br />
© 25<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 28<br />
In Castaic Lake Water Agency v. Whittaker Corp., 107 the district court held that where<br />
perchlorate contamination originated at one site and allegedly migrated to the wells owned by<br />
plaintiff water providers at a different site, plaintiffs can satisfy their burden of production with<br />
respect to CERCLA causation by: (1) identifying perchlorate at their site; (2) identifying<br />
perchlorate at defendant’s site; and, (3) providing “evidence of a plausible migration pathway by<br />
which the contaminant could have traveled from the defendant’s facility to the plaintiff’s site.” 108<br />
Where the plaintiffs satisfy this burden, the burden then shifts to the defendant to offer evidence<br />
“disproving causation.” 109<br />
In Coeur D’Alene Tribe v. Asarco Inc., the district court adopted a “contributing factor”<br />
causation test for the recovery of <strong>NRD</strong>. 110<br />
That is, where hazardous waste from multiple<br />
defendants has commingled, the plaintiff trustee has the burden of proving that each defendant’s<br />
release is a more than a de minimis, “contributing factor” to the natural resource injuries alleged<br />
by the trustee.<br />
One last causation burden exists for trustees in the context of assessing <strong>NRD</strong>. The DOI’s<br />
<strong>NRD</strong> assessment (“<strong>NRD</strong>A”) regulations 111 require that trustees determine the baseline condition<br />
of the injured resource and then compare that baseline with the injured status of the resource to<br />
quantify injury. “Baseline” is defined under the DOI <strong>NRD</strong>A regulations as “the condition or<br />
conditions that would have existed at the assessment area had the discharge of oil or release<br />
107 272 F. Supp. 2d 1053 (C.D. Cal. 2003).<br />
108 Id. at 1066.<br />
109 Id.<br />
110 280 F. Supp. 2d at 1114.<br />
111 43 C.F.R. § 11 (2005).<br />
© 26<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 29<br />
under investigation not occurred.” 112<br />
While the trustee has the burden of determining baseline<br />
under the <strong>NRD</strong>A regulations, defendants should ensure that the trustee is apprised of all<br />
appropriate conditions or factors impacting the resource other than the release of the hazardous<br />
substances at issue.<br />
These cases demonstrate a key issue with regard to causation-that ultimately, causation is<br />
not difficult to prove. Furthermore, even if the contamination is mingled between multiple PRPs,<br />
it will not be difficult to show causation sufficient to prevail in a suit for <strong>NRD</strong>. These cases also<br />
show the potential interplay of substantive law and case management issues. For example, it<br />
should be sufficient to prove wrongful misconduct and some causation so as to establish the<br />
liability of a responsible party and thereby shift the cost of a comprehensive <strong>NRD</strong>A to the<br />
wrongdoer as opposed to the trustee.<br />
D. INJURY<br />
A natural resource injury is “any adverse change or impact of a discharge on a natural<br />
resource or impairment of natural resource services, whether direct or indirect, long-term or<br />
short-term, and include the partial or complete destruction or loss of the natural resource.” 113<br />
Clarity with regard to assertion of the type of injury to a natural resource is an essential<br />
component of bringing a successful claim for <strong>NRD</strong>. If a plaintiff does not clearly and<br />
specifically define and quantify the nature of the injury, there is a significant risk that a claim for<br />
<strong>NRD</strong> will fail. In State of New Mexico v. General Electric Company, the plaintiffs were<br />
prevented from recovering <strong>NRD</strong> due to their failure to clearly and accurately set forth the nature<br />
112 43 C.F.R. § 11.14(e) (2005)(emphasis added).<br />
113 Kanner, supra note 14, at 98.<br />
© 27<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 30<br />
of the injuries they claimed. 114<br />
Plaintiffs asserted a claim for the loss of drinking water services<br />
as a result of chemical contamination emanating from the defendants’ operations. 115<br />
The court<br />
held that the drinking water standards promulgated by the New Mexico Water Quality Control<br />
Commission (“NMWQCC”) should be used to determine if there was an injury-the loss of<br />
drinking water services. 116<br />
Under these rules, water must only meet the requisite standards with<br />
regard to the level of contaminants; the water need not be pristine in order to qualify as<br />
potable. 117<br />
The plaintiffs, however, contended that the drinking water standards were not the<br />
proper means of identifying the injury. The court disagreed, stating:<br />
In effect, then, Plaintiffs now argue two different theories of injury: (1) that<br />
“[t]he standard for drinking water quality for the groundwater involved in this<br />
lawsuit is the more stringent NMWQCC health-based toxic pollutant standard”;<br />
and (2) that “the groundwater and aquifer will remain injured unless and until it<br />
is restored to its pre-contaminated condition.” These two assertions, often made<br />
together, are not wholly congruent . . . In this case, it may well be that the State<br />
of New Mexico has suffered an injury to its interest in the groundwater<br />
underlying the South Valley Site, notwithstanding the fact that much of the<br />
groundwater meets the New Mexico drinking water standards, but it may be that<br />
the injury is not the total and permanent loss of drinking water services that<br />
Plaintiffs now assert. To date, however, Plaintiffs have proffered no significant<br />
probative evidence of any diminution in value of the groundwater, measured by<br />
the difference between its current condition and its formerly pristine state, apart<br />
from the alleged loss of drinking water services. No expert witness has testified<br />
as to the economic value of water that may prove to be drinkable, but still not<br />
pristine . . .Plaintiffs’ own characterization of their alleged injury selects the<br />
legal standard to be applied to measure the existence and extent of that injury.<br />
Drinkability does not equate with pristine purity under New Mexico law, and<br />
the court remains convinced that a loss of drinking water services must be<br />
measured by applying New Mexico drinking water standards. 118<br />
114 335 F. Supp. 2d at 1212.<br />
115 Id.<br />
116 Id. at 1210.<br />
117 Id.<br />
118 Id. at 1211-1212 (emphasis original).<br />
© 28<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 31<br />
What this case demonstrates is that quantification of the type of natural resource injury is<br />
essential to a successful recovery.<br />
The plaintiffs may have had been successful had they<br />
considered what loss of use involves before asserting it as the primary injury. 119<br />
It also<br />
demonstrates that <strong>NRD</strong> claims for injury relating solely to loss of use are generally weaker and<br />
have a lower possibility of success then a claim for restoration where there is an injury by mere<br />
virtue of the existence of contaminants in the natural resource.<br />
One of the most critical factors in recovering <strong>NRD</strong> is the distinct nature and extent of the<br />
injury and what that means for damages. It must be remembered that proving how a natural<br />
resource has been injured is not the same as proving what amount of damages should be<br />
recoverable.<br />
E. DAMAGES<br />
1. Generally<br />
The method and manner of quantifying damages to a natural resource is perhaps the<br />
greatest challenge for <strong>NRD</strong> litigation, both presently and in the future. 120<br />
“Damage is a legal<br />
concept determining what a liable party has to do or pay to make the public or environment<br />
whole for the injuries to natural resources.” 121<br />
In addition, damages help to deter future<br />
119 Credibility with regard to <strong>NRD</strong> claims is essential, especially when non-traditional injuries are being asserted.<br />
“Before a lawyer can persuade a jury or any fact-finder, it is necessary to start at the beginning and decide what the<br />
case is about. Surprisingly, many lawyers never really know this fact, or they (or their experts) change their game<br />
plan so often that it seems they have no plan . . . In short, the case should be as planned as possible before going to<br />
court.” ALLAN KANNER, ENVIRONMENTAL AND TOXIC TORT TRIALS § 1.01 (2d ed. 2004).<br />
120 Because of the complex nature of damages, the damages phase may be bifurcated from the rest of the trial.<br />
“Bifurcation of an action is appropriate where . . . there are complicated issues of liability that must be resolved prior<br />
to the assessment of damages.” Witherbee v. Honeywell, Inc., 151 F.R.D. 27, 29 (N.D.N.Y. 1993).<br />
121 See Kanner, supra note 14, at 104.<br />
© 29<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 32<br />
misconduct. 122<br />
<strong>NRD</strong> is defined by CERCLA as the compensation for the “[i]njury to,<br />
destruction of, or loss of natural resources, including the reasonable costs of assessing such<br />
injury.” 123 CERCLA’s congressional hearings are filled with testimony that the <strong>NRD</strong> provisions<br />
should measure society’s full loss from damaged or destroyed natural resources, not just<br />
damages capable of market valuation. 124 This is fundamental to deterring wrongful conduct.<br />
125<br />
This broader concept is reflected in § 301(c)(2) of CERCLA, which requires damage assessment<br />
procedures to identify the extent of short- and long-term, direct and indirect injury, destruction,<br />
or loss. 126<br />
Thus, Congress explicitly stated that recoverable injuries were not limited solely to<br />
use or market value but also indirect injury (e.g., the intrinsic value of a natural resource).<br />
Comments also urged that the legislation shift the burden of any such losses from victims to<br />
responsible parties, consistent with concepts of strict liability. 127 If a response action fails to<br />
provide a complete and whole remedy for injury to a natural resource, damages may be<br />
122 See, e.g. Cipollone v. Liggett Group, Inc., 505 U.S. 504, 521 (1992)(quoting San Diego Bldg. Trades Council v.<br />
Garmon, 359 U.S. 236, 247 (1959))(“[t]he obligation to pay compensation can be, indeed is designed to be, a potent<br />
method of governing conduct and controlling policy.”).<br />
123 42 U.S.C. § 9601(6), 9607(a)(4)(C).<br />
124 See, e.g., OIL AND HAZARDOUS SUBSTANCES LIABILITY AND OIL POLLUTION LIABILITY: EXCERPTS FROM<br />
HEARINGS ON H.R. 29 AND H.R. 85 BEFORE THE SUBCOMM. ON COAST GUARD AND NAVIGATION OF THE HOUSE<br />
COMM. ON MERCHANT MARINE AND FISHERIES, 96th Cong., 1st Sess. 119 (1979) (statement of James N. Barnes,<br />
Center for Law and Social Reform).<br />
125 See generally Allan Kanner & Tibor Nagy, Measuring Loss of Use Damages in Natural Resource Damage Actions,<br />
30 COLUMBIA J. ENVTL. L. Error! Main Document Only.(2005) Vol. 30, No. 2, p. 417.<br />
126 42 U.S.C. § 9651(c)(2).<br />
127 Supra note 123, at 213, 214, n. 23 (statement of Sarah Chasis, National Advisory Committee on Oceans and<br />
Atmosphere).<br />
© 30<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 33<br />
recovered for such. 128<br />
Any recovery had by a trustee for <strong>NRD</strong> “must be used to restore, replace,<br />
or acquire the equivalent” of the injured natural resources. 129<br />
There are three primary categories of damages for a trustee to consider: restoration,<br />
compensatory restoration, and assessment and other transaction costs.<br />
a. Restoration<br />
Restoration, or primary restoration costs, involves the cost of any action, or combination<br />
of actions, to restore, rehabilitate, replace, or acquire the equivalent of the injured natural<br />
resources and services in a “baseline state.” Essentially, this is the cost of restoration of the<br />
resource to its pre-damage condition, taking into account natural recovery. Replacement can be<br />
a viable action in this context, so long as the citizens of a state do not otherwise suffer. For<br />
instance, replacing a North Louisiana greenspace with an equivalent one in South Louisiana does<br />
little to assuage the damage to residents of North Louisiana. A state should have the right to full<br />
restoration of natural resources, however, even if it will ultimately be more costly than<br />
replacement. This idea is consistent with the notion that there is a preference for a complete<br />
restoration of the damaged natural resource, rather than the creation of an entirely new one.<br />
b. Compensatory Restoration<br />
In addition, there are use and non-use 130 compensatory restoration values that must be<br />
repaid. These damages involve the provision of additional restoration of injured resources in<br />
order to compensate for lost natural resource functions and services from the time of<br />
128 See Kanner, supra note 14, at 102.<br />
129 42 U.S.C. § 9607(f)(1).<br />
130 “Nonuse values are values people may hold for natural resource services that are independent of any anticipated<br />
use of the resource.” William H. Desvousges and Janet C. Lutz, Compensatory Restoration: Economic Principles<br />
and Practice, 42 ARIZ. L. REV. 411, 412 (2000).<br />
© 31<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 34<br />
contamination through the time the resource is restored. 131<br />
Compensatory restoration is not<br />
directly defined in the statutory language of the OPA and CERCLA, although it is discussed in<br />
the regulations developed under each of these statutes.<br />
The OPA regulations, promulgated by the National Oceanic and Atmospheric<br />
Administration (NOAA) define restoration as “any action or combination of<br />
actions, to restore, rehabilitate, replace or acquire the equivalent of injured<br />
natural resources and services.” These same regulations identify “compensatory<br />
restoration” as included within restoration generally and define it as “action(s)<br />
taken to make the environment and the public whole for services losses that<br />
occur from the date of the incident until recovery of the injured natural<br />
resources.” 132<br />
Due consideration must be given to discern the unique value of the natural resources of<br />
the state. Natural resources are more than mere property claims. They are inextricably<br />
interwoven into the fabric of our ecology and the quality of our lives as we steward them from<br />
one generation of our citizens to the next. Natural resources must be valued both in the present<br />
and prospectively.<br />
If these prospective consequences may, in reasonable probability, be<br />
expected to flow from the past harm, the state is entitled to be paid for them. 133<br />
Loss of use, or<br />
benefit to polluter, both damage the people during the period of impairment and restoration.<br />
These damages should be equal to the benefit derived or savings to the parties damaging the<br />
natural resource. If, for instance, a natural resource was damaged by one thousand dollars to<br />
save or make one million dollars, this should be recaptured to the extent not otherwise covered.<br />
This item of damages forces the wrongdoer to internalize the costs of pollution by usage fee or<br />
131 43 C.F.R. § 11.83 (2005).<br />
132 See Kanner, supra note 14, at 103 (citations omitted).<br />
133 See Coll v. Sherry, 148 A.2d 481, 486 (N.J. 1959).<br />
© 32<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 35<br />
unjust enrichment. 134<br />
c. Costs<br />
Another important measure of damages is the assessment and other transaction costs.<br />
These damages include all costs, expenses and fees incurred by the state, including due diligence<br />
and pre-litigation costs and attorney fees, in recovering the foregoing. Also included is the time<br />
value of money. 135<br />
Compensation for transaction costs means full restoration. It is important to<br />
note that costs are not necessarily available under non-CERCLA state law theories unless equity<br />
is involved.<br />
2. Valuation<br />
There are numerous approaches to determining value for <strong>NRD</strong>. One example is the<br />
valuation approach of the DOI. 136<br />
While it seeks restoration as its goal, the DOI program<br />
sometimes works in the opposite direction, i.e. when a defendant is permitted to purchase a<br />
cheaper replacement rather than restore the natural resource. Like many tort cases, it places an<br />
emphasis on assessing damage in a monetary framework, as opposed to restoration, as the means<br />
134 See Allan Kanner, Unjust Enrichment in Environmental Litigation, 20 J. ENVTL. L. & LITIG. Error! Main<br />
Document Only. p. 111 (Spring, 2005).<br />
135 See Natural Resource Damage Assessments, 43 C.F.R. Parts 11.84 (2001). Section 107 (a)(4)(c) provides that<br />
responsible parties may be held liable for “damages for injury to, destruction of, or loss of natural resources,<br />
including the reasonable costs of assessing such injury, destruction, or loss resulting from such a release.” However,<br />
under section 107(f), a trustee may not recover for natural resource loses occurring before the date of CERCLA’s<br />
enactment (December 11, 1980), or for losses identified in an environmental impact assessment, which are deemed<br />
to be authorized by permit or license. Likewise, under section 107(c), the trustee may not recover in excess of $50<br />
million unless a showing is made that the release resulted from willful misconduct or willful negligence, or from a<br />
violation of federal safety or operating standards.<br />
136 Under the DOI rules, the measure of damages “is the cost of restoration or replacement of the damaged resource.<br />
Additionally, compensable value, the value of the lost services of the resource during the time period from the injury<br />
until the baseline conditions have been reattained, is available for recovery at the discretion of the trustee. The<br />
trustee can chose between several valuation methods for estimating compensable value, including market valuation,<br />
appraisal, factor income, travel cost, hedonic pricing, unit value, contingent valuation, or other suitable valuation<br />
methods. The use of contingent valuation for measuring option and existence value is available only when the<br />
trustee determines there are no relevant use values.” James Peck, Measuring Justice for Nature: Issues in<br />
Evaluating and Litigating Natural Resource Damages, 14 J. LAND USE & ENVTL. L. 275, 302 (1999).<br />
© 33<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 36<br />
to making the public whole, and thus is perceived by the regulated community to be punitive<br />
rather than productive.<br />
On the other hand is the more Industry-friendly approach of NOAA. Under the NOAA<br />
approach, <strong>NRD</strong> now focuses on remediation of harm rather than monetization of claims. In<br />
addition, it utilizes an open process that requires public comment, and encourages cooperation<br />
with responsible parties rather than litigation. The NOAA regime is “restoration based,” that is,<br />
it establishes restoration of the damaged natural resources as the goal, and provides the agency<br />
and the responsible party a great deal of flexibility to develop a plan to move forward and<br />
achieve it. In general, there is more room for disagreement regarding valuation of loss of use<br />
claims. 137<br />
F. DEFENSES<br />
Because the pursuit of <strong>NRD</strong> is relatively new territory, one of the areas with the greatest<br />
potential for development and change is the defenses to liability. As <strong>NRD</strong> cases are more<br />
frequently litigated, new, creative and complex defenses will be asserted.<br />
Plaintiffs can<br />
anticipate a variety of defenses that may be offered by defendants in <strong>NRD</strong> cases. A defendant<br />
may argue, for example, that if a groundwater resource is not currently being used by the public,<br />
then there has been no harm suffered if it is contaminated. Defendants may also contest liability<br />
when there are multiple polluters of a single resource, thereby making it difficult to attribute<br />
particular contamination to specific source. Furthermore, a defendant may argue that a remedy is<br />
not reasonable or proportionate to the harm, i.e. when restoration costs far exceed the market<br />
value of the property.<br />
1. Statutory Defenses<br />
137 See Kanner supra note 124.<br />
© 34<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 37<br />
Most federal environmental statutes specifically enumerate defenses to liability available<br />
to a defendant in <strong>NRD</strong> actions. CERCLA, for example, provides that a person otherwise liable<br />
for contamination will not be liable in the event the damages resulting from the release or threat<br />
of release were caused “solely by-(1) an act of God; (2) an act of war; (3) an act or omission of a<br />
third party . . .” 138<br />
Similar provisions are found in the CWA 139 and OPA 140 Because of their<br />
limited application, however, these “formal” defenses are rarely successful.<br />
“Informal<br />
defenses,” such as those described below provide defendants with the opportunity to more<br />
successfully contest liability.<br />
2. Applicability of CERCLA<br />
One important issue with regard to defenses to CERCLA is the applicability of the statute.<br />
CERCLA does not apply retroactively. Section 107(f)(1) of CERCLA states “[t]here shall be no<br />
recovery . . . where such damages and the release of hazardous substance from which such<br />
damages regulated have occurred wholly before December 11, 1980 [enactment day of<br />
138 42 U.S.C. § 9607(b).<br />
139 33 U.S.C. § 1321(f)(1)(“Except where an owner or operator can prove that a discharge was caused solely by (A)<br />
an act of God, (B) an act of war, (C) negligence on the part of the United States Government, or (D) an act or<br />
omission of a third party without regard to whether any such act or omission was or was not negligence . . . such<br />
owner or operator of any vessel from which oil or a hazardous substance is discharged . . . shall . . . be liable to the<br />
United States Government for the actual costs incurred under subsection (c) of this section for the removal of such<br />
oil or substance by the United States Government . . .”). “CERLCA’s use of the word ‘omission’ in the phrase ‘act<br />
or omission’ of a third party suggests that the conduct of the third party must be wrongful. After all, an omission<br />
can only exist in relation to a duty to act. The Clean Water Act defense, however, expressly provides that the act or<br />
omission of the third party need not be negligent to qualify as the sole cause. The defense is available ‘without<br />
regard to whether any such act or omission was or was not negligent.’ One significant difference between the third<br />
party defense of the Clean Water Act and CERCLA is that the CERCLA does not contain this exception, suggesting<br />
perhaps that one way to distinguish the causation of the defendant and the third party is that the defendant must<br />
prove that the third party’s conduct was somehow wrongful.”). James R. MacAyeal, The Comprehensive<br />
Environmental Response, Compensation, and Liability Act: The Correct Paradigm of Strict Liability and the<br />
Problem of Individual Causation, 18 UCLA J. ENVTL. L. & POL’Y 217, 311 (2000/2001).<br />
140 33 U.S.C. § 2703(a)(“A responsible party is not liable for removal costs or damages under section 2702 of this<br />
title if the responsible party establishes, by a preponderance of the evidence, that the discharge or substantial threat<br />
of a discharge of oil and the resulting damages or removal costs were caused solely by-(1) an act of God; (2) an act<br />
of war; (3) an act or omission of a third party . . . ”).<br />
© 35<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 38<br />
CERCLA].” 141<br />
Thus, if <strong>NRD</strong> occurred on or before the December 11, 1980 date, a defendant is<br />
not liable under CERCLA. 142<br />
“[W]here damages are readily divisible [between pre and postenactment<br />
damages], the sovereigns cannot recover for such damages incurred prior to the<br />
enactment . . . In cases where the natural resource damages are not divisible and the damages or<br />
releases that caused the damages continue post-enactment, the sovereigns can recover for such<br />
non-divisible damages in their entirety.” 143<br />
In Coeur d’Alene Tribe v. Asarco, Inc., the United States and the Coeur d’Alene Tribe<br />
sought to recover <strong>NRD</strong> associated with releases of mine wastes. 144<br />
The defendants argued that<br />
no hazardous substance releases had occurred after CERCLA’s enactment in 1980, and no post<br />
enactment damages had occurred because environmental conditions in the Coeur d’Alene Basin<br />
had continuously improved. 145<br />
The trustees argued that the contaminants continued to be<br />
released and re-released, and maintained that the critical date, for purposes of CERCLA, is when<br />
an injury is quantified. 146<br />
The court ruled that CERCLA’s “wholly before” limitation did not bar the plaintiffs from<br />
recovery. 147<br />
The court found that “passive migration caused by leaching from variations in low<br />
and high water is a post-enactment release under CERCLA.” 148 Furthermore, the court concluded<br />
141 42 U.S.C. § 9607(f)(1).<br />
142 United States v. Reilly Tar and Chemical Corp., 546 F. Supp. 1100, 1120 (D. Minn. 1982).<br />
143 In re Acushnet River and New Bedford Harbor Proceeding, 716 F. Supp. 676, 685-686 (D. Mass. 1989).<br />
144 280 F. Supp. 2d at 1114.<br />
145 Id.<br />
146 Id.<br />
147 Id. at 1113.<br />
148 Id.<br />
© 36<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 39<br />
that the “passive movement and migration of hazardous substances by mother nature (no human<br />
action assisting in the movement) is still a ‘release’ for purposes of CERCLA in this case.” 149<br />
The court then relied on Aetna Casualty and Surety Co., Inc. v. Pintlar Corp., 150<br />
and In re<br />
Acushnet River and New Bedford Harbor Proceedings, 151 to conclude that “damages” for<br />
purposes of the “wholly before” limitation are defined as the “monetary quantification of the<br />
injury.” 152<br />
The court held that “damages occurred post-enactment when the federal government<br />
and Tribe began studying the ‘injury’ caused by the mining industry and how to clean up the<br />
injury to natural resources.” 153<br />
Distinguishing the Ninth Circuit’s 2002 en banc decision in<br />
Carson Harbor, 154 the court ruled that the defendants’ releases did not occur “wholly before”<br />
1980 because the continued, post-enactment passive migration of the contaminants constituted a<br />
“release” or “re-release” under the statute. 155<br />
The district court further held that even if all of the<br />
defendants’ releases occurred before 1980, the plaintiffs’ claim would still not be barred by<br />
section 9607(f) because “the damages associated with such releases occurred post-enactment . . .<br />
the statute only excuses liability if the release and the damages both occur pre-enactment.” 156<br />
149 Id.<br />
150 948 F. 2d 1507 (9th Cir. 1991).<br />
151 716 F. Supp. at 681.<br />
152 Coeur d’Alene, 280 F. Supp. 2d at 1114.<br />
153 Id.<br />
154 Carson Harbor Village, Ltd. v. Unocal Corporation, 270 F.3d 863 (9th Cir. 2001)(en banc).<br />
155 Coeur d’Alene, 280 F. Supp. 2d at 1113.<br />
156 Id. at 1114 (emphasis original).<br />
© 37<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 40<br />
In Montana v. Atlantic Richfield Company, Judge Haddon reached the opposite<br />
conclusion on CERCLA’s “wholly before” limitation. 157<br />
Montana brought an <strong>NRD</strong> action<br />
against Atlantic Richfield seeking to recover restoration costs at “upland areas” in the Clark Fork<br />
River Basin. 158<br />
The court rejected the theory that damages do not occur until expenses are<br />
incurred or costs are quantified, finding that such a theory is “unpersuasive” and would render<br />
the “wholly before” limitation in the statute meaningless. 159<br />
Instead, the court held that<br />
“damages accrue or occur, including restoration costs, when the underlying injury occurs.” 160<br />
The court barred the state of Montana’s claim for restoration cost damages because such<br />
damages occurred wholly before December 11, 1980.<br />
3. <strong>NRD</strong> and Site Remediation are the Same<br />
A defendant may also attempt to defend against its liability by taking advantage of the<br />
fact that most judges do not possess a significant degree of sophistication with regard to<br />
environmental issues. In the event a judge is not familiar with this highly specialized area of law,<br />
a defendant may attempt to blur the distinction between costs associated with site remediation<br />
and the recovery of <strong>NRD</strong>.<br />
There is, however, a clear distinction between the goals of<br />
remediation and those for the recovery of <strong>NRD</strong>. With regard to site remediation, a PRP is<br />
responsible for the costs associated with the remediation of the pollution. <strong>NRD</strong> is designed to<br />
compensate the public for the damage to its natural resources and the loss of use resulting from<br />
the resource’s contamination.<br />
157 Montana v. Atlantic Richfield Co., 266 F. Supp. 2d 1238 (D. Mont. 2003).<br />
158 Id. at 1239.<br />
159 Id. at 1243-1244.<br />
160 Id. at 1242.<br />
© 38<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 41<br />
In an effort to avoid the payment of damages for the destruction of natural resources, a<br />
defendant may argue that the site remediation must be completed before <strong>NRD</strong> can be assessed.<br />
While a defendant engages in countless site assessments and feasibility studies, the loss of use of<br />
the natural resource and the continued degradation of the site is being ignored. Consequently, a<br />
defendant is actually attempting to postpone a realization of its liability under the guise of<br />
“action.” However, as discussed earlier, site remediation can last for years without any actual<br />
cleanup occurring.<br />
A defendant may argue that since it is engaged in site remediation, a cost-benefit analysis,<br />
which is often used in the context of site remediation, is appropriate for the assessment of <strong>NRD</strong>.<br />
However, no court has ever used a cost-benefit analysis to value <strong>NRD</strong>. If a cost-benefit analysis<br />
is used to determine the amount of money that is recoverable for <strong>NRD</strong>, the public will almost<br />
never be fully restored because the nonmonetary value of the natural resources cannot be fully<br />
and fairly calculated.<br />
4. Preemption of <strong>Fe</strong>deral Law<br />
When a trustee files a claim for <strong>NRD</strong> pursuant to state law, one common defense that a<br />
defendant may assert is that the law on which the claim is based is preempted by federal law.<br />
Generally, there are three ways in which a state law may be preempted by federal law. First,<br />
Congress can explicitly state in a federal statute that it preempts state law. 161<br />
Second, state law<br />
that legislates in an area that Congress has exclusively reserved to the federal government will be<br />
preempted. 162 Third, state law will also be preempted if it conflicts with federal law. 163 “The<br />
161 Attorney General v. Consumers Power Company, 508 N.W.2d 901, 902 (Ct. App. Mich. 1993).<br />
162 Id.<br />
163 Id.<br />
© 39<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 42<br />
presumption is that powers historically belonging to the states are not preempted by federal<br />
legislation unless that is the clear and manifest purpose of Congress.” 164<br />
The fact that the states<br />
have historically been entrusted with the protection of natural resources lends credence to the<br />
argument that federal laws will rarely preempt state law claims for <strong>NRD</strong>.<br />
In In the Matter of Allied Towing Corporation, a party who spilled oil into the<br />
Chesapeake Bay filed a complaint seeking limitation of liability pursuant to the Limitation of<br />
Liability Act 165 and § 1321(f) of the CWA. 166<br />
The United States responded by filing a claim for<br />
cleanup costs and the State of Virginia also responded by filing a claim seeking civil penalties,<br />
cleanup costs and damages for injury to natural resources. 167<br />
The court held that federal law<br />
does not supersede a valid exercise of a state’s police power unless there is a specific<br />
manifestation of Congress’s intent to preempt state law. 168<br />
With respect to the interaction<br />
between the CWA and Virginia state statutes, the court stated:<br />
Nothing in this scheme [of the CWA], however, conflicts with or otherwise<br />
preempts any state statute, such as Virginia’s, imposing liability on the owner or<br />
operator of any vessel which illegally discharges oil, nor does it limit the<br />
amount of liability. Similarly, nothing in the FWPCA precludes the states from<br />
imposing civil penalties upon vessel owners or operators who violate state<br />
statutes by discharging oil illegally. It merely provides the states with an<br />
alternative federal remedy which assures that, either through the action and<br />
expenditure of the state or <strong>Fe</strong>deral Government, the natural resources of this<br />
country will be preserved.” 169<br />
164 Id.<br />
165 46 U.S.C. §§ 181-189 (1976).<br />
166 In the Matter of Allied Towing Corporation, 478 F. Supp. 398, 400 (E.D. Va. 1979).<br />
167 Id. at 400.<br />
168 Id. at 401.<br />
169 Id. at 403.<br />
© 40<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 43<br />
Preemption of state law often arises in the context of <strong>NRD</strong> when the resource that has<br />
been injured is a navigable body of water, thus seemingly invoking admiralty and maritime<br />
issues. However, courts have consistently held that state actions are not preempted by federal<br />
law when state law does not conflict with federal law and Congress has not specifically<br />
legislated the issue. 170<br />
In general, federal environmental statutes are not enacted to supplant state<br />
statutory and common law causes of action; rather, they are meant to be supplements to ensure<br />
that trustees have adequate means by which they may seek and recover <strong>NRD</strong>.<br />
5. Scope of the Public Trust Doctrine<br />
When <strong>NRD</strong> claims are brought pursuant to the public trust doctrine, it is highly likely that<br />
a defendant will contest the scope of the doctrine’s application. As noted in section II.A.1, infra,<br />
in early American cases, the public trust doctrine was initially applied to suits involving the<br />
protection of navigable waters. 171<br />
The doctrine has evolved over time, however, and has been<br />
expanded to include the protection of, not only navigable waters, but other resources, including<br />
wildlife 172 and beaches. 173<br />
Some states have even extended the doctrine to include recreational<br />
170 In re Ballard Shipping Company v. Beach Shellfish, 32 F.3d 623, 631 (1st Cir. 1994)(holding that the Rhode<br />
Island Environmental Injury Compensation act that permits state law remedies for damage resulting from oil<br />
pollution is not preempted by federal maritime law); In the Matter of Nautilus Motor Tanker Co., Ltd., 900 F. Supp.<br />
697, 704 (D.N.J. 1995)(holding that New Jersey’s common law with respect to the recovery of purely economic<br />
losses “is not preempted as impermissibly prejudicing federal maritime law). But see State of Maryland v. Kellum,<br />
51 F.3d 1220, 1228 (4th Cir. 1995)(federal law preempts state natural resources code when it alters the rights and<br />
liabilities afforded to the parties under federal maritime law).<br />
171 For a more complete discussion of the evolution of the public trust doctrine, see generally Kanner, supra note 8.<br />
172 In re Steuart Transportation, 495 F. Supp. 38, 40 (E.D. Va. 1980).<br />
173 Borough of Neptune City v. Borough of Avon-By-The-Sea, 294 A.2d 47, 55 (N.J. 1972).<br />
© 41<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 44<br />
activities such as sailing, swimming, hunting and the enjoyment of scenic and aesthetic<br />
beauty. 174<br />
Despite the fact that there is a trend toward expansion, those who oppose an extension of<br />
the doctrine, contend that the inclusion of other resources is not consistent with the historic<br />
foundation of the doctrine. 175<br />
A prime example of this debate is the issue of whether or not<br />
groundwater should be protected by the public trust doctrine.<br />
The vital role groundwater plays in the survival and development of the United States is<br />
rapidly emerging as an important and visible issue in the American consciousness. Groundwater<br />
supplies approximately ninety-six percent of the water in the United States. 176<br />
Moreover, at least<br />
fifty percent of the “of the domestic water used in the United States is derived from<br />
groundwater.” 177 In some areas, populations are one hundred percent reliant on groundwater. 178<br />
Thus, it follows that groundwater is one of the nation’s most precious natural resources.<br />
Opponents to the extension of the public trust doctrine assert that the traditional<br />
application of the public trust doctrine extended only to surface water; however, advances in<br />
science and technology demonstrate that there is a significant interrelationship between ground<br />
and surface water. 179<br />
It follows from this fact and basic hydrogeologic concepts that<br />
contamination of surface water can ultimately lead to the contamination of groundwater. This<br />
174 Hixon v. Public Service Commission, 146 N.W.2d 577, 582 (Wis. 1966).<br />
175 See Kanner, supra note 8.<br />
176 Albert P. Barker & Richard B. Burleigh, Agricultural Chemicals and Groundwater Protection: Navigating the<br />
Complex Web of Regulatory Controls, 30 IDAHO L. REV. 443, 449 (1993/1994).<br />
177 Id.<br />
178 Blake Johnston, Dara Lum & Susan Curtis, Groundwater in the West, 8 U. Denv. Water L. Rev. 328, 335 (2004).<br />
179 Kanner, supra note 8.<br />
© 42<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 45<br />
understanding, coupled with the knowledge that the preservation of groundwater has become<br />
crucial to the survival of our communities, has paved the way for groundwater’s inclusion within<br />
the bounds of the public trust doctrine.<br />
Additionally, it can be argued that the same reason the public trust was first applied to<br />
navigable waters, in order to foster the development of early American settlements, is precisely<br />
the same reason that the public trust doctrine should now encompass the protection of<br />
groundwater. Because the public trust doctrine “should not be considered fixed or static, but<br />
should be molded and extended to meet changing conditions and the needs of the public it was<br />
intended to benefit,” 180 the scope of the doctrine should remain broad and should extend to all<br />
resources that provide some benefit to the public, especially when basic human survival is<br />
dependent on such a resource.<br />
6. Government Contractor Defense<br />
One of the greatest ironies when considering <strong>NRD</strong> is the fact that, frequently, pollution<br />
emanates from facilities that provide services or products that have significant value or are<br />
necessary to our society for purposes of economics and development. The pollution associated<br />
with these products or services may be characterized by polluters as a sort of “necessary evil.” 181<br />
It follows that some of these services and products required by the general public are also<br />
required by the government. A government’s need for such products or services is especially<br />
critical, for example, when the country is engaged in a war. Furthermore, it has often been the<br />
180 Borough of Neptune City, 294 A.2d at 54.<br />
181 This characterization of pollution begs the question of whether the evil was truly avoidable and necessary. There<br />
is a predisposition to assume that polluters “did not know any better” when polluting the environment prior to the<br />
enactment of environmental regulations. The reality, however, is that the notion of “necessary evil” cannot be taken<br />
at face value. Polluters must be held accountable for all of their actions, whether environmental regulations existed<br />
at the time of pollution or not.<br />
© 43<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 46<br />
case that such products and services are commissioned or rationed expressly by the government<br />
for use by the military during such times.<br />
When the government has requisitioned services or products from a defendant, a<br />
defendant might assert a government contractor defense to liability stemming from actions<br />
related to the provision of these services or products. 182<br />
This defense is based on the notion that<br />
when a PRP is compelled to provide services or products for the United States any injury or<br />
damage arising as a result of performance of that obligation is excusable. The government<br />
contractor defense is “a matter of federal common law which displaces state law . . . Because<br />
federal procurement actively implicates ‘uniquely federal interests’ in ‘getting the Government’s<br />
work done,’ when the three referenced elements are present, state tort law significantly conflicts<br />
with federal interests and federal common law preempts it, providing a complete defense against<br />
state law claims.” 183<br />
In Boyle v. United Technologies Corporation, the United States Supreme Court<br />
thoroughly discussed the application of the government contractor defense. 184<br />
In Boyle, a<br />
wrongful death suit was brought against an independent contractor who manufactured the<br />
helicopter and faulty escape-hatch system that ultimately resulted in a navy pilot’s death after the<br />
182<br />
Courts have held that this is not a viable third party defense with respect to CERCLA. See, e.g., United States v.<br />
Shell Oil Company, 1992 WL 144296, No. CV. 91-0589-RJK, at *10 (C.D. Cal. Jan. 16, 1992). In Shell, the oil<br />
company defendants argued “that the plaintiffs are not entitled to recover because defendants’ actions were<br />
undertaken pursuant to contracts between them and the United States . . . 42 U.S.C. § 9620 addresses the issues of<br />
government contractor liability in the CERCLA context. It provides that nothing in this section shall be construed to<br />
affect the liability of any person or entity under sections 9606 and 9607 . . . In light of § 9620 and the strict liability<br />
language of § 107, this affirmative defense is inappropriate and inconsistent with the third-party defense provided<br />
within § 107. As such, it is dismissed.”<br />
183 Yeroshefsky v. Unisys Corporation, 962 F. Supp. 710, 715 (D. Md. 1997)(citing Boyle v. United Technologies<br />
Corporation, 487 U.S. 500, 504, 512 (1988).<br />
184 487 U.S. 500 (1988).<br />
© 44<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 47<br />
helicopter crashed off the coast of Virginia. 185<br />
The court recognized the potential conflict<br />
between federal interests and state tort law with respect to government procurement contracts. 186<br />
The court examined the government contractor defense in the context of the <strong>Fe</strong>deral Tort Claims<br />
Act (“FTCA”), 187 which is a consent to suit against the United States for the negligent or<br />
wrongful conduct of Government employees, except as to those claims that are “based upon the<br />
exercise or performance or the failure to exercise or perform a discretionary function or duty on<br />
the part of the federal agency or an employee of the Government, whether or not the discretion<br />
involved be abused.” 188<br />
Accordingly, government contractors are not subject to liability “when<br />
(1) the United States approved reasonably precise specifications; (2) the equipment conformed to<br />
those specifications; and (3) the supplier warned the United States about the dangers in the use of<br />
the equipment that were known to the supplier but not to the United States.” 189<br />
Perhaps the most significant requirement of this three part test in the context of <strong>NRD</strong><br />
actions is the United States’ approval of “reasonably precise specifications.” The United States<br />
Supreme Court discussed the discretionary function exception in Berkovitz v. United States:<br />
In examining the nature of the challenged conduct, a court must first consider<br />
whether the action is a matter of choice for the acting employee. This inquiry is<br />
mandated by the language of the exception; conduct cannot be discretionary<br />
unless it involves an element of judgment or choice . . . Thus, the discretionary<br />
function exception will not apply when a federal statute, regulation, or policy<br />
specifically prescribes a course of action for an employee to follow. In this event,<br />
the employee has no rightful option but to adhere to the directive. And if the<br />
employee’s conduct cannot appropriately be the product of judgment or choice,<br />
185 Id.<br />
186 Id. at 511.<br />
187 28 U.S.C. § 1346(b).<br />
188 Boyle, 487 U.S. at 511 (quoting 28 U.S.C. § 2680(a)).<br />
189 487 U.S. at 512.<br />
© 45<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 48<br />
then there is no discretion in the conduct for the discretionary function exception<br />
to protect . . . The exception, properly construed, therefore protects only<br />
governmental actions and decisions based on considerations of public policy . . .<br />
In sum, the discretionary function exception insulates the Government from<br />
liability if the action challenged in the case involves the permissible exercise of<br />
policy judgment. 190<br />
Thus, in order for the government contractor defense to apply, the government must have made a<br />
decision relating to the conduct at issue, i.e. the government must have exercised a discretionary<br />
function.<br />
Courts have consistently held in environmental contamination cases where a defendant is<br />
asserting a government contractor defense that the United States never manifested the requisite<br />
approval of the manner and type of waste disposal activities that were responsible for the<br />
contamination of natural resources.<br />
In Lamb v. Martin Marietta Energy Systems, Inc., property owners brought a suit against<br />
a gaseous diffusion plant to recover for environmental damages caused by discharges of<br />
pollutants into the atmosphere, soil, bodies of water and ditches at the plant. 191<br />
The defendant<br />
moved for summary judgment based on its relationship with the United States as a government<br />
contractor. 192<br />
The defendants argued that the Department of Energy (“DOE”) exercised<br />
substantial control over operations at the facilities, and therefore, all activities fell within the<br />
discretionary function exception. 193<br />
In denying the defendant’s motion for summary judgment,<br />
the court held that “[t]he defendants have failed to present specific evidence regarding the<br />
190 486 U.S. 531, 536-537 (1988).<br />
191 835 F. Supp. 959 (W.D. Ky. 1993).<br />
192 Id. at 962.<br />
193 Id. at 966.<br />
© 46<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 49<br />
directions and orders that the DOE gave with respect to waste management units at the plant.” 194<br />
Therefore, the defendants did not satisfy the first element of the government contractor defense<br />
demonstrating that the pollution resulted from express approval and direction of the government.<br />
In Arness v. Boeing North American Inc., the plaintiffs filed suit against the defendant<br />
asserting violations of state environmental laws stemming from the release and disposal of<br />
trichloroethylene (“TCE”) which contaminated the groundwater, soil and subsurface soil of the<br />
area surrounding a facility which manufactured and tested rocket engines. 195<br />
The defendant<br />
argued that the contamination resulted from rocket engine contracts that were performed<br />
pursuant to the specific direction and control of the United States. 196<br />
The defendant argued that<br />
the United States had specifically required the use of TCE. 197<br />
The court ultimately determined<br />
that the defendant failed to prove that he was “acting under” the direction of a federal officer,<br />
stating,<br />
[The defendant’s] use of TCE did not cause Plaintiffs’ injuries. Rather, Plaintiffs’<br />
injuries were allegedly caused by [defendant]’s negligent disposal and storage of<br />
TCE, which activities were not performed at the government’s behest . . . “[t]he<br />
government did not specify safeguards to prevent the release of TCE to the air and<br />
ground in these flushing procedures” . . . Furthermore, . . . [the defendant] does<br />
not submit any evidence that the government required . . . [the defendant] to store<br />
194 Id. at 968.<br />
195 In this case, the court examined the issue of governmental direction and control in light of defendants’ removal of<br />
the case pursuant to the federal officer removal statute, 28 U.S.C. § 1442(a)(1), which states that an action filed<br />
against “[t]he United States or any agency thereof or any officer (or any person acting under that officer) of the<br />
United States or of any agency thereof, sued in an official capacity for any act under color of such office or on<br />
account of any right, title or authority claimed under any Act of Congress” may be removed to federal court.<br />
Although the court did not expressly address the likelihood that the defendant’s government contractor defense<br />
would actually succeed in light of the facts, the reasoning used by the court is parallel to that which a court would<br />
use to examine the discretionary function exception when considering the applicability of the government contractor<br />
defense.<br />
196 Id. at 1270.<br />
197 Id.<br />
© 47<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 50<br />
the TCE in a particular manner which resulted in the alleged release of TCE that<br />
caused Plaintiffs’ injuries. 198<br />
In New Jersey Department of Environmental Protection v. ExxonMobil Corporation, the<br />
State of New Jersey filed an <strong>NRD</strong> action in New Jersey state court against ExxonMobil for<br />
contamination resulting from refinery operations, alleging violations of the New Jersey Spill Act<br />
and common law nuisance and trespass claims. 199<br />
Defendant ExxonMobil Corporation removed<br />
the case to federal court, arguing jurisdiction under §1442, asserting the government contractor<br />
defense. 200<br />
The court remanded the case, stating with regard to the government contractor<br />
defense that “it is not entirely clear that this defense, which sounds in products liability, would<br />
apply here, to an issue turning on the construction of state environmental law.” 201<br />
In addition,<br />
the court stated that ExxonMobil’s claim that the Petroleum Administration for War exerted<br />
control over “the manufacture, production, storage, and transfer of petroleum products” failed to<br />
establish the government’s control over improper waste disposal methods, the action causing the<br />
injury of which the plaintiffs complained. 202<br />
198 Id. at 1275. Similarly, in Bahrs v. Hughes Aircraft Company, 795 F. Supp. 965 (D. Ariz. 1992), the defendant<br />
attempted to invoke federal jurisdiction by arguing it had acted under the direction of federal government when<br />
disposing of waste products that led to the contamination of the plaintiffs’ water supply. The court held that<br />
“[w]hile the government officials were undoubtedly most interested in the production of war materials, the record<br />
before this Court does not demonstrate the government’s necessary control over the method of waste disposal. The<br />
mere fact that the government possessed the power to exercise control over the project does not establish that the<br />
power was ever in fact exercised.” Id. at 970.<br />
199 New Jersey Department of Environmental Protection v. ExxonMobil Corporation, No. Hud-L 4415-04 (N.J.<br />
Super. Ct. filed Aug. 18, 2004).<br />
200 Notice of Removal at § 1.20, New Jersey Department of Environmental Protection v. ExxonMobil Corporation,<br />
No. Hud-L 4415-04 (N.J. Super. Ct. filed Aug. 18, 2004).<br />
201 New Jersey Department of Environmental Protection v. ExxonMobil Corporation, No. 04-CV-4897, slip op. at 7<br />
(D.N.J. March 24, 2005).<br />
202 Id. at 8.<br />
© 48<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 51<br />
As demonstrated by the reasoning of the courts in the aforementioned cases, a defendant<br />
must provide specific evidence demonstrating that any discharges or improper waste disposal<br />
occurred with the express approval and direction of the federal government in order to satisfy the<br />
first prong of the requirements of the government contractor defense. Given the overall lack of<br />
success defendants have historically had with such a defense in environmental contamination<br />
cases, it is unlikely that it will succeed in future <strong>NRD</strong> cases.<br />
A key consideration in this type of defense is absolute joint and several liability-it is<br />
ultimately irrelevant if a portion of <strong>NRD</strong> occurred during war. Furthermore, if a defendant raises<br />
this type of defense, he ultimately bears the burden of proof as to the degree of his contribution<br />
to the contamination.<br />
7. Statutory Immunity<br />
Along the same lines as the government contractor defense, defendants may also assert<br />
defenses based on immunity provisions found in certain federal statutes regarding government<br />
contracts. The Defense Production Act, the National Defense Act, the Navy Purchase Act, and<br />
the First and Second War Powers Acts contain immunity provisions for defendant contractors<br />
performing contracts entered into pursuant to those statutes.<br />
The Defense Production Act<br />
(“DPA”), for example, states in relevant part: “No person shall be held liable for damages or<br />
penalties for any act or failure to act resulting directly or indirectly from compliance with a rule,<br />
regulation, or order issued pursuant to this Act . . .” 203<br />
For purposes of this analysis, the<br />
application of DPA immunity will be examined in the context of the numerous “Agent Orange”<br />
suits.<br />
In Ryan v. Dow Chemical Company, civilians in Vietnam filed a suit against “Agent<br />
203 50 U.S.C. App. § 2157.<br />
© 49<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 52<br />
Orange” manufacturers, claiming injuries resulting from exposure to the chemical defoliant. 204<br />
The defendants argued that the case should be removed pursuant to § 1442, asserting the<br />
government contractor defense and immunity under the DPA. 205<br />
Although the court ruled that<br />
the DPA was a “colorable” defense for purposes of removal, the court questioned the validity of<br />
such claims of immunity, stating “[t]here is a dispute as to whether section 707 [of the DPA]<br />
provides immunity against tort suits based in strict liability and negligence of the sort the civilian<br />
plaintiffs wish to pursue. On a previous occasion, this court was inclined to view section 707 as<br />
immunizing contractors only for contract damages, although it did not rule on the issue.” 206<br />
The<br />
“previous occasion” referenced by the Ryan court, was the Eastern District of New York’s<br />
decision in In re “Agent Orange” Product Liability Litigation, in which the defendant<br />
manufacturers argued that, under the DPA, they should not be held liable for complying with<br />
“Agent Orange” production contracts entered into with the United States government. 207<br />
As<br />
noted in Ryan, the Agent Orange court held that immunity under the DPA did not necessarily<br />
extend to liability for torts:<br />
It is indisputable that the statutory ancestors of section 707 only immunized<br />
contractors from liability for breach of contract damages; the law was explicit on<br />
that point . . . It is telling that neither the Defense Production Act itself nor the<br />
legislative history made any reference to tort claims despite the fact that, as<br />
evidenced by this suit, the contracts “rated” under the Act “involve items, the<br />
production of which may . . . give[e] rise to the possibility of an enormous amount<br />
of claims. If section 707 is to be applied to tort claims at all, it should only be read<br />
to bar claims for strict liability, not negligence. The former involve holding a<br />
defendant liable despite the fact that it may not have been at fault and the liability<br />
thus truly “result[s] . . . from compliance with . . . this Act.” Whether this last<br />
204 781 F. Supp. 934 (E.D.N.Y. 1992).<br />
205 Id. at 938.<br />
206 Id. at 945.<br />
207 597 F. Supp. 740, 843 (E.D.N.Y. 1984).<br />
© 50<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 53<br />
interpretation or one not applying section 707 to tort suits altogether is adopted, the<br />
Defense Production Act would not bar plaintiffs’ claims. 208<br />
Similarly, in Hercules, Inc. v. United States, the federal circuit examined the scope of<br />
immunity of section 707 of the DPA.<br />
In Hercules, manufacturers sued the United States<br />
government in order to recover expenses incurred as a result of Agent Orange litigation. 209<br />
The<br />
defendants argued that because the government had compelled them to enter into contracts for<br />
the production of “Agent Orange” pursuant to section 101 of the DPA, the defendants were<br />
entitled to immunity under section 707 for both contract and tort suits. 210<br />
The court disagreed,<br />
stating:<br />
The language of section 101(a) makes it clear that the purpose of the statute is to<br />
authorize the President to dictate that preference be given the government<br />
contracts which are necessary to promote the national defense . . . Significantly,<br />
section 101(a) does not mention either the specific nature of performance under a<br />
DPA contract, or the subsequent use of goods produced under such a contract.<br />
Therefore, we conclude that, while the risk imposed by section 101(a) does<br />
include the possible need of a contractor to break its contracts with third parties in<br />
order to give preference to a DPA contract, it does not include the risk that the<br />
product produced under the DPA contract will be inherently unsafe to users. 211<br />
Consistent with the court’s reasoning in In re Agent Orange, immunity under the DPA<br />
would not apply to defendants who improperly dispose of waste or discharge hazardous<br />
substances despite the existence of a contract with the government. Unless a contract with the<br />
government explicitly directs and authorizes the waste disposal and discharge methods to be<br />
undertaken by a defendant, it is difficult to see how the DPA can successfully be asserted as a<br />
208 Id. at 845.<br />
209 24 F.3d 188 (<strong>Fe</strong>d. Cir. 1994).<br />
210 Id. at 202. 50 U.S.C. app. § 2071(a)(1964) authorizes the President “to compel contract performance as well as<br />
contract acceptance.” Id. at 202-203.<br />
211 Id. at 203.<br />
© 51<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 54<br />
defense to liability for <strong>NRD</strong>.<br />
8. Standing to Bring <strong>NRD</strong> Claims<br />
Defendants may also contend that the state does not have sufficient standing to bring<br />
<strong>NRD</strong> claims. In Department of Environmental Protection v. Jersey Central Power and Light Co.,<br />
the State of New Jersey filed suit against a public utility engaged in the operation of a nuclear<br />
power plant. 212<br />
The court held that the state, seeking to recover damages as parens patriae for<br />
damage to fisheries caused by the defendant’s cooling water discharges during plant operations,<br />
had standing to seek both an injunction and damages. 213<br />
The court rejected the defendant’s argument that the state did not have a proprietary right<br />
to the fish in its waters sufficient to support an action for damages. 214<br />
Affirming the judgment of<br />
the lower court, the court stated that the State of New Jersey has “not only the right, but also the<br />
affirmative fiduciary obligation to ensure that the rights of the public to a viable marine<br />
environment are protected, and to seek compensation for any diminution in the trust corpus.” 215<br />
The court further said that “absent some special interest in some private citizen, it was<br />
questionable whether anyone but the state could be considered the proper party to sue for<br />
recovery of damages to the environment.” 216<br />
212 336 A.2d 750 (N.J. Super. Ct. App. Div. 1975), aff’d., 336 A.2d 750 (N.J. Super. Ct. App. Div. 1975), rev’d on<br />
other grounds, 351 A.2d 337 (N.J. 1976).<br />
213 Id. at 759.<br />
214 Id. at 758-759.<br />
215 Id. at 759.<br />
216 Id.<br />
© 52<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 55<br />
Some defendants have even gone so far as to question a state’s inherent right to protect its<br />
natural resources as a public trustee. In New Jersey Department of Environmental Protection v.<br />
ExxonMobil Corporation, the defendant made the following argument:<br />
State ownership of natural resources derives from the sovereign rights of the<br />
British Crown and of the United States, and is governed by federal law, since<br />
under the equal footing doctrine these rights must be the same in all states.<br />
Plaintiffs’ expansive theories of natural resource ownership and damages go<br />
beyond the sovereign rights transmitted to New Jersey by the British Crown at<br />
independence in 1776, and would offend the equal footing doctrine if they were<br />
upheld. 217<br />
ExxonMobil essentially argued that New Jersey exceeded its authority by attempting to bring<br />
<strong>NRD</strong> claims pursuant to the New Jersey Spill Act and common law. This case is currently<br />
pending in New Jersey state court, however, given New Jersey’s historical pattern of upholding<br />
the State’s authority to bring <strong>NRD</strong> claims, it is unlikely this defense will be successful.<br />
III.<br />
CONCLUSION<br />
The preservation, protection and reclamation of natural resources have become<br />
increasingly more important as the devastating impact of contamination is revealed.<br />
The<br />
multiplying number of <strong>NRD</strong> cases that are filed each year serves as a testament to this fact. The<br />
process of resolving these cases will force the courts and litigants to take a hard look at the<br />
available universe of approaches. Because of the highly specific nature of each <strong>NRD</strong> case, the<br />
manner of application and the success of these claims will only be realized over time as <strong>NRD</strong> is<br />
examined on a case by case basis.<br />
217 Notice of Removal at 1.20(e), New Jersey Department of Environmental Protection v. ExxonMobil Corporation,<br />
No. Hud-L 4415-04 (N.J. Super. Ct. filed Aug. 18, 2004).<br />
© 53<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 1<br />
Settlement of<br />
Natural Resource Damage Litigation:<br />
The Defendant’s Perspective<br />
Recent Developments<br />
Angus Macbeth<br />
Sidley Austin LLP<br />
1501 K Street, N.W.<br />
Washington, DC 20005<br />
1<br />
PAYMENT OF RESTORATION COSTS TO TRUSTEES<br />
U.S. v. F/V North Wind (D. Haw. 2009)<br />
In 2005, vessel ran aground in Hawaiian Islands National Wildlife Refuge (part of<br />
Marine National Monument), discharge of oil and injury to reef.<br />
$3.8 million covering trustee-sponsored restoration; Coast Guard response costs.<br />
U.S. v. Puget Sound Energy (W.D.Wash. 2009)<br />
1800 gal. spill of diesel fuel from facility in National Forest, flowed to ground,<br />
groundwater, and creek.<br />
<strong>NRD</strong> under OPA.<br />
$50,000 for damage assessment costs; $513,000 for <strong>NRD</strong>. Trustees to develop and<br />
implement plan for restoration, rehabilitation, or replacement of natural resources<br />
injured by spill.<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 2<br />
RESTORATION BY MIX OF PRIVATE AND<br />
GOVERNMENT FUNDS<br />
Coal Tar Processing Facility Site, Everett, Mass.<br />
1890s to 1960s various companies – Beazer East, Honeywell International, Keyspan –<br />
or predecessors in interest operated coal tar processing facility. Adverse impact on<br />
fish.<br />
2006 – 2007 Private companies constructed Release Abatement Measure to isolate<br />
impacted sediment; restored 4.3 acres of salt marsh<br />
Payment of $100,000 towards NOAA’s assessment and restoration costs for 4 acres<br />
of wetlands at site.<br />
U.S. v. American Hoechst Corp; U.S. v. A.R. Sandri, Inc. (D. Conn 2009)<br />
Solvents Recovery Service of New England Site in Southington, Conn.<br />
Two decrees resolving claims against 257 parties for CERCLA clean up (one group of<br />
PRPs to perform clean up); both groups of PRPs to pay almost 90% of past clean up<br />
costs and almost 90% of estimated $3.325 million for <strong>NRD</strong><br />
3<br />
AMENDMENT OF CONSENT DECREE WITH EPA<br />
U.S. v. Horsehead Industries et al. (M.D. Pa 2009)<br />
1898-1981 – 2 primary zinc smelters; after 1981 – 1 secondary zinc smelter. Cinder<br />
Bank 2.5 miles long, 200 feet high, 200 feet wide at crest, 1000 feet wide at base,<br />
covering 200 acres. Heavy metals in stack emissions reduced or killed vegetation,<br />
contaminated surface water, sediments, and groundwater.<br />
2003 EPA CERCLA consent decree amended to address <strong>NRD</strong>.<br />
Habitat-based approach to assess injuries, using HEA. Human service losses also<br />
evaluated.<br />
Two habitat protection actions “peculiarly suited to performance by” settling<br />
defendants and required by decree: 1. Preservation of 1200 acre King’s Manor<br />
property; 2. Release of mortgage on Lehigh Gap Nature Center Property. Plus $2.5<br />
million to reimburse Trustees and $9,875,000 for <strong>NRD</strong>.<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 3<br />
BANKRUPTCY AND COMMODITY PRICES<br />
ASARCO<br />
Jan. 2003 - ASARCO settles suit with government for alleged fraudulent conveyance<br />
which allows sale of stock to its parent and payment of various debts, and restructures<br />
its environmental obligations with the federal government.<br />
Trust established and funded by ASARCO in amount of $100 million; for three years<br />
U.S. would not seek to compel ASARCO to pay more than Trust amount on its<br />
environmental obligations to the U.S., primarily CERCLA clean up and <strong>NRD</strong>.<br />
April 2005 – Beset with asbestos claims, ASARCO filed for bankruptcy.<br />
Dec 2009 – ASARCO emerged from bankruptcy, paying $194 million to settle the<br />
<strong>NRD</strong> claims against it.<br />
5<br />
ASARCO SETTLEMENT<br />
<strong>NRD</strong><br />
California Gulch in central Colorado<br />
$5.9 million to DOI; $5.9 million to Colorado<br />
Bunker Hill in Coeur d’Alene Basin, northern Idaho<br />
$79.5 million jointly to DOI and Forest Service<br />
Ray Mine/Hayden Smelter in Arizona<br />
$3.8 million jointly to DOI and Arizona<br />
Southeast Missouri Lead Mining District<br />
$41.2 million jointly to DOI and Missouri<br />
Tri-State Mining District in Kansas, Missouri, and Oklahoma<br />
$62.4 million jointly to DOI, the 3 states, and 6 Indian Tribes.<br />
Additional payments to EPA and states bring total environmental settlement to $1.79<br />
billion.<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 4<br />
WHAT HAPPENED?<br />
Price of copper rose 500% since Jan 2003.<br />
7<br />
“PROTECTING THE GOVERNMENT FROM<br />
UNWARRANTED <strong>NRD</strong> CLAIMS”<br />
Ohio v. Department of Energy (S.D. Ohio 2008)<br />
DOE uranium processing facility in <strong>Fe</strong>rnald, Ohio.<br />
$13.75 million in restoration account to restore, replace or acauire the equivalent of<br />
injured natural resources; a covenant restricting most types of future development at<br />
the site.<br />
In 1996, GAO estimated DOE’s total <strong>NRD</strong> liability as likely to be in the range of<br />
$2.8 to $13 billion (CEQ’s estimate was $159-611 million)<br />
Colorado v. U.S.; U.S. v. Shell Oil Co. (D. Colo. 2009)<br />
Rocky Mountain Arsenal<br />
U.S. will pay Colorado $7.4 million, following Shell’s agreement to pay state $10<br />
million for <strong>NRD</strong>, and undertake certain other monetary and property donations.<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 5<br />
CLAIM VALUED BY HABITAT EQUIVALENCY<br />
ANALYSIS (HEA) – COMMENCEMENT BAY<br />
U. S., Washington, Puyallup Tribe of Indians & Muckleshoot Indian Tribe v. General<br />
Metals of Tacoma, Inc. (W.D.Wash. 2008);<br />
U.S. et al. v. Occidental Chemical (W.D.Wash. 2009);<br />
U.S. et al v. Petroleum Reclaiming Service (W.D.Wash 2009);<br />
Large array of metals and chemicals found in Commencement Bay Environment.<br />
Assessment began in 1991.<br />
“Trustees used the term discounted ecological service acre-years (DSAYs) to<br />
describe the scale of injuries, and the amount of habitat restoration they are seeking<br />
to compensate for the injuries.”<br />
Funds, property, or in-kind services sought to compensate for lost DSAYs.<br />
Defendants allocated liability for X number of DSAYs and proportionate damage<br />
assessment costs.<br />
Restoration project defendant agrees to undertake set out in Appendix<br />
9<br />
HABITAT EQUIVALENCY ANALYSIS<br />
HEA attempts to ensure that restoration projects create or restore the same quantity of<br />
services that were lost through release of hazardous substances. Including lost interim<br />
services.<br />
Commencement Bay: U.S. v. AOL Express, Inc. (W.D. Wash. 2006):<br />
Levee relocated, restored natural flow of river, provided 66 acres of salmonspawning<br />
habitat and other benefits.<br />
PRP group funded $2.3 million project, paid $150,000 oversight costs, and their<br />
own cost of oversight, settling monetary claim of abt. $13.5 million<br />
Bore risk that project would fail to produce benefits<br />
See Lacampagne & Miller, “Settling <strong>NRD</strong> Claims by Appropriately Valuing Injury<br />
and Damages,” 24 NR&E No. 1 (2009)<br />
Critique of HEA: Dunford, Ginn & Desvousges, “The use of habitat equivalency<br />
analysis in natural resource damage assessments,” 48 Ecological Economics 49 (2004)<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 6<br />
HABITAT EQUIVALENCY ANALYSIS<br />
U.S. v. Great Lakes Dredge and Dock Co., 259 F.3d 1300, 1305 (11 Cir.<br />
2001)<br />
Destruction of sea bottom in Florida Keys Marine Sanctuary when tug boat ran<br />
aground.<br />
HEA used to scale or quantify the size of the equivalent area to be restored and,<br />
therefore, to quantify the damages for lost interim services and the acquisition of<br />
equivalent resources.<br />
Challenged pursuant to Daubert and upheld.<br />
Same result in U.S. v. Fisher, 174 F.3d 201 (11 Cir. 1999)<br />
11<br />
2008 AMENDMENT OF INTERIOR’S <strong>NRD</strong><br />
ASSESSMENT REGULATIONS<br />
Providing a “restoration-based” approach to all damages.<br />
“Methodologies that compare losses arising from resource injury to gains expected from restoration<br />
actions are frequently simpler and more transparent than methodologies used to measure the<br />
economic value of losses.”<br />
Four examples of project-based assessment methodologies:<br />
> Conjoint analysis;<br />
> Habitat equivalency analysis;<br />
> Resource equivalency analysis;<br />
> Random utility analysis.<br />
Any methodology that meets “acceptance criteria” permitted – feasibility and reliability, reasonable<br />
cost, avoidance of double counting, cost effectiveness.<br />
Comparing functional losses from resource injuries to functional gains expected from restoration<br />
actions should reduce effort to recover monetary value of passive economic losses.<br />
73 <strong>Fe</strong>d. Reg. 57259 (Oct. 2, 2008)<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 7<br />
PROJECT-BASED ASSESSMENT METHODOLOGIES<br />
Conjoint Analysis<br />
Like contingent valuation, conjoint analysis is a stated preference method. However, instead of<br />
seeking to value natural resource service losses in strictly economic terms, conjoint analysis<br />
compares natural resource service losses that arise from injury to natural resource service gains<br />
produced by restoration projects.<br />
Habitat Equivalency Analysis<br />
May be used to compare the natural resource services produced by habitat or resource-based<br />
restoration actions to natural resource service losses.<br />
Resource Equivalency Analysis<br />
Similar to habitat equivalency analysis. This methodology may be used to compare the effects of<br />
restoration actions on specifically identified resources that are injured or destroyed.<br />
Random Utility Model<br />
Can be used to: (A) Compare restoration actions on the basis of equivalent resource services<br />
provided; and (B) Calculate the monetary value of lost recreational services to the public.<br />
13<br />
NEW JERSEY<br />
U.S. v. Beckman-Coulter (D.N.J. 2009)<br />
Coombe Fill south Superfund Site.<br />
Approx. 300 defendants will pay U.S. and New Jersey $69 million in cleanup costs,<br />
more than $3 million in <strong>NRD</strong> and buy a $27 million annuity for future clean up and<br />
costs.<br />
The state program continues – see Brad Martin’s write up.<br />
Restoration Projects on the web. Go to The Conservation Exchange – Archive for<br />
the <strong>NRD</strong> settlement candidage projects.<br />
www.njconservationexchange.org/category/nrd-settlement-project;<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 8<br />
NEW JERSEY CONSERVATION EXCHANGE<br />
Belcher Creek Preservation<br />
Posted in <strong>NRD</strong> settlement candidate project, biological diversity, climate stabilization<br />
and/or air pollution mitigation project, land preservation project, projects funded by<br />
conservation resources, water protection, filtration, & control<br />
The 220-acre Belcher Creek property, adjacent to Bearfort Mountain State Park, forms<br />
part of the largest contiguous forest in the Highlands. It buffers a portion of Belcher<br />
Creek, a tributary to Greenwood Lake, which is a source of water for New Jersey’s two<br />
important northern reservoirs–Monksville and Wanaque.<br />
The NJDEP Geological Survey’s Groundwater Recharge model shows approximately<br />
140 acres of this property as having the highest groundwater recharge rate calculated at<br />
16-23 inches per year. About 15 acres have the second highest recharge rate of between<br />
11-15 inches per year. The remaining land is characterized by a wooded wetland<br />
complex associated with Belcher Creek.<br />
15<br />
According to the NJDEP Landscape Project, this property contains habitat for several<br />
endangered and threatened species including barred owl, cerulean warbler, northern<br />
goshawk, timber rattlesnake and wood turtle.<br />
Ecosystem Services Provided:<br />
Water protection, filtration & control: Water quality and quantity- protection of<br />
groundwater recharge areas, stream buffers<br />
Climate stabilization and air pollution mitigation: carbon sequestration- avoided<br />
deforestation<br />
Biological diversity: Habitat- federal threatened species habitat protection<br />
Total Project Cost: $2,550,000<br />
Status: The landowner is a willing seller and is currently negotiating with the Passaic<br />
River Coalition. They want to close on this property in <strong>2010</strong><br />
16<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24a: 9<br />
INABILITY TO PAY<br />
U.S. v. Hector Losada and the Andrew (S.D. Fla. 2008)<br />
Commercial vessel run aground in area protected by the National Marine<br />
Sanctuaries Act.<br />
$5000 payment for response costs and damages – based on inability to pay.<br />
Agreement not to operate vessel or engage in fishing in sanctuary for five years.<br />
U.S. v. Dreifort (S.D. Fla 2009)<br />
<br />
<br />
<br />
Defendants placed artificial lobster traps (“casitas”) in Florida Keys National<br />
Marine Sanctuary<br />
Limited ability to pay; defendants to sell property, proceeds to satisfy claim.<br />
Agreement not to operate vessel or participate in fishing in sanctuary for five<br />
years.<br />
17<br />
USEFUL WEB SITE<br />
NOAA Office of the General Counsel – <strong>NRD</strong> Consent Decrees/Settlements.<br />
www.gc.noaa.gov/natural-officel.html;<br />
Historic record of NRC consent decrees to which NOAA is a party.<br />
18<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 1<br />
Settlement of Natural Resource<br />
Damage Litigation:<br />
The Defendant’s Perspective<br />
Bradley M. Marten<br />
Marten Law Group PLLC<br />
1191 Second Avenue, Suite 2200<br />
Seattle, WA 98101<br />
206-292-2600<br />
bmarten@martenlaw.com<br />
www.martenlaw.com<br />
DC1 1763595v.1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 2<br />
CONSIDERATIONS REGARDING THE SETTLEMENT OF <strong>NRD</strong> CLAIMS<br />
A. Cooperative Assessments<br />
A cooperative assessment is one where the Trustees and the PRPs are jointly involved in<br />
conducting one or more phases of the <strong>NRD</strong> assessment process, including injury assessment,<br />
restoration planning, and implementation. The degree of cooperation can vary, from simply<br />
sharing assessment plans and data, to a fully cooperative process where the Trustees and the<br />
PRPs jointly design and conduct studies and work together to develop and implement a<br />
restoration program. The DOI, Bureau of Indian Affairs, is presently engaged in cooperative<br />
assessments at several sites involving injury to tribal resources.<br />
The OPA <strong>NRD</strong> regulations require that PRPs be given the opportunity to participate in the<br />
damage assessment process and, when appropriate, to jointly conduct a coordinated and open<br />
damage assessment with the Trustees. Unlike CERCLA, cooperative assessments under OPA are<br />
now commonplace. However, the extent of cooperation and the roles of the Trustees and the<br />
PRPs vary by incident. And, while the rules encourage cooperation, they do not provide any<br />
specific guidelines on how to develop a cooperative assessment process. The absence of such<br />
guidance led NOAA’ s DARRP to develop a Cooperative Assessment Process (“CAP”) web site,<br />
which serves as a clearinghouse of information for cooperative assessment frameworks,<br />
approaches, and tools. 1<br />
The CAP was developed to promote the coordinated efforts of industry interests and<br />
governments (federal, state, and tribal) to facilitate the restoration of natural resources and their<br />
services injured or lost by hazardous substance releases and oil spills. The goal of the CAP is to<br />
optimize <strong>NRD</strong> assessment and restoration opportunities in the response or cleanup phase. The<br />
incentive to PRPs to participate in the CAP is a greater voice and more control over the timing of<br />
restoration actions, with reduced <strong>NRD</strong> assessment costs and reduced risk of litigation. The<br />
Trustees’ incentive is the expedited restoration of injured natural resources and associated<br />
services, and receiving PRP funding up front or through timely reimbursement. As a general<br />
rule, PRPs and Trustees agreeing to engage in cooperative assessment execute a Funding and<br />
Participation Agreement, under which the PRP agrees to pay all, or some percentage, of the<br />
Trustees’ assessment costs.<br />
One CAP approach under OPA <strong>NRD</strong> assessment is the formation of Joint Assessment Teams<br />
(“JATs”) in various parts of the country. The West Coast JAT, an ad hoc group of<br />
representatives from various state and federal trustee agencies, spill response organizations, and<br />
representatives from the oil industry formed in 1996, meets three times a year to discuss a variety<br />
of topics related to conducting cooperative assessments including collection of ephemeral data,<br />
injury assessment, <strong>NRD</strong>A case histories, recent developments in <strong>NRD</strong>A, and available resources.<br />
They have published recommendations for conducting cooperative <strong>NRD</strong> assessment, which<br />
include, among other things, (1) factors to consider early during the response phase of an<br />
incident to facilitate cooperation and expedite the damage assessment process; (2) suggestions<br />
1 http://www.darrp.noaa.gov/partner/cap/index.html<br />
DC1 1763595v.1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 3<br />
for developing a coordinated <strong>NRD</strong> assessment response organization; and (3) suggestions for<br />
developing an interim cooperative assessment agreement. 2<br />
B. Integration of Remediation and <strong>NRD</strong> Activities at Department of Energy<br />
Facilities<br />
In 1996, the GAO estimated likely <strong>NRD</strong> at Department of Energy sites to be within the range of<br />
$2.8 billion to $13 billion, although it found that damages within the range of $2.3 billion to<br />
$20.5 billion were possible. 3 In addition to being a PRP at a site, however, the DOE is<br />
frequently the “lead agency” for remediation and a natural resource trustee.<br />
As lead agency, DOE will perform or oversee the response action. As natural resource trustee,<br />
DOE will be responsible, along with any co-trustees, for determining whether and to what extent<br />
natural resources under its trusteeship have been damaged. Other trusteeship interests on a DOE<br />
site may include other federal agencies which are trustees for particular natural resources; in such<br />
cases, DOE will be the primary federal trustee for resources on its facilities. At most DOE sites,<br />
state and tribal authorities will be the most important non-DOE trustees.<br />
In 1997, the DOE developed a policy for integrating natural resource concerns into response<br />
actions. 4 The 1997 Policy, which provides guidance on fulfilling DOE’s multiple roles,<br />
“requires heads of field organizations and program and project managers to consider natural<br />
resource risk issues and, when appropriate, seek to resolve them with the other natural resource<br />
trustees, such as States and Tribes.” DOE has sought to establish site-specific trustee councils at<br />
sites such as Hanford in Washington and Oak Ridge in Tennessee, which work to integrate<br />
natural resources concerns into remedial decision making and restoration planning.<br />
The most recent example of DOE’s integration of natural resource concerns into response actions<br />
is at Hanford, where two state and three tribal trustees filed suit against it, seeking past and<br />
future response costs, <strong>NRD</strong>, and a declaratory judgment of liability for natural resource injury<br />
assessment costs. 5 Shortly after briefing closed on DOE’s motion to dismiss the trustees’ claims<br />
for declaratory judgment of liability for assessment costs, but before argument was heard, DOE<br />
announced that it would be integrating a phased <strong>NRD</strong> assessment into its ongoing cleanup<br />
actions at the site. 6<br />
C. Using Environmental Conflict Resolution in <strong>NRD</strong> Cases<br />
2 West Coast Joint Assessment Team, Recommendations for Conducting Cooperative Natural Resource Damage<br />
Assessment (April 2007), available at<br />
http://www.darrp.noaa.gov/partner/cap/pdf/2007/02004%20JAT%20Recommendations%20Final.pdf.<br />
3 GAO, Natural Resources Damage at DOE (1996, GAOLRCED-96-206R), at 2. In 1997, DOE provided its own<br />
report concerning its potential <strong>NRD</strong> liability. While noting a large range of uncertainty, it estimated liability to be in<br />
the range of $1.4 to $2.5 billion. See Richard B. Stewart, Memorandum Re: Legal and Related Policy Issues for<br />
Integrating Remediation and <strong>NRD</strong> Strategies at DOE Sites (6/21/05) at 21.<br />
4 DOE, “Policy on the Integration of Natural Resource Concerns into Response Actions” (1997) (“1997 Policy”).<br />
5 USDC, Eastern District of Washington Case No. CY-02-3105-LRS.<br />
6 DOE Press Release, “DOE to Conduct Natural Resource Damage Assessment Process at Hanford,” (4/3/07),<br />
available at http://www.hanford.gov/communication/reporter/attachmentsiRL/2007/RL-07-0006.pdf.<br />
DC1 1763595v.1<br />
3<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 4<br />
Parties seeking to resolve their <strong>NRD</strong> liability through settlement may be aided by the use of a<br />
neutral third party, such as a mediator or facilitator. On November 28, 2005, the Director of the<br />
Office of Management and Budget and the Chairman of the President’s Council on<br />
Environmental Quality issued a Memorandum on Environmental Conflict Resolution (“ECR”).<br />
The joint policy statement sets forth “Basic Principles for Agency Engagement in Environmental<br />
Conflict Resolution and Collaborative Problem Solving” and directs federal agencies to increase<br />
the effective use of ECR and their institutional capacity for collaborative problem solving. One<br />
means of doing so is through the use of assisted negotiations using, for example, the U.S.<br />
Institute for Environmental Conflict Resolution, the U.S. Department of Justice, or other<br />
ECR/ADR organizations as appropriate. The EPA and the U.S. Institute for Environmental<br />
Conflict Resolution jointly designed and initiated a National Roster of Environmental Dispute<br />
Resolution and Consensus Building Professionals, 7 a list of individuals deemed qualified to<br />
mediate or facilitate environmental disputes.<br />
SURVEY OF SETTLEMENTS UNDER FEDERAL AND STATE <strong>NRD</strong> LAW<br />
A. NOAA Settlements<br />
NOAA’s Damage Assessment, Remediation, and Restoration Program (“DARRP”) is the federal<br />
trustee for coastal and marine resources. The DARRP program was created in 1992 after the<br />
1989 Exxon Valdez oil spill. Between 1992 and 2006, DARRP and state and federal trustees<br />
generated approximately $437 million in <strong>NRD</strong> settlements in 179 cases. 8<br />
7 http://www.ecr.gov/roster/index.htm.<br />
8 Healing our Coasts / Protecting Our Future: NOAA Damage Assessment Remediation and Restoration Program<br />
(April 2007). Available at: www.darrp.noaa.gov/. (Hereinafter “NOAA Accomplishments Report: 2007.”)<br />
DC1 1763595v.1<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 5<br />
Many of NOAA’s settlements involve oil spills, but a significant number involve hazardous<br />
substance releases, primarily in urban bays. In April 2007, NOAA published a report<br />
summarizing its accomplishments during the first 15 years of its program. 9 It counted, among its<br />
accomplishments, the following settlements:<br />
• Northeast and Great Lakes Region<br />
o 14 oil spills<br />
o 34 hazardous materials releases<br />
• Southeast and Gulf Region<br />
o 15 oil spills<br />
o 11 hazardous materials releases<br />
• Pacific Region<br />
o 11 oil spills<br />
o 30 hazardous materials releases<br />
See: NOAA Accomplishments Report: 2007.<br />
9 Available at: www.darrp.noaa.gov.<br />
DC1 1763595v.1<br />
5<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 6<br />
B. <strong>Fe</strong>deral Settlements Generally<br />
1. 2000 10<br />
a. OPA<br />
The barge North Cape and the tug Scandia ran aground and spilled oil in the waters of Block<br />
Island Sound, Rhode Island, spilling more than 828,000 gallons of home heating oil and killing 9<br />
million lobsters and more than 2,000 marine birds. To resolve the United States’ claims, the<br />
parties responsible for the spill agreed to undertake a lobster restoration program that involved<br />
the v-notching and restocking of 1.248 million female legal-size lobsters into the waters of Block<br />
Island Sound by the end of 2004. The defendants also agreed to pay $8 million to the National<br />
Oceanic and Atmospheric Administration, the Department of the Interior, and the Rhode Island<br />
Department of Environmental Management to implement the following restoration projects:<br />
shellfish restoration (quahog transplanting), salt pond land acquisition, loon restoration<br />
(acquisition of land or easements to protect loon nests), sea bird restoration (acquisition of land<br />
or easements to protect eider nests), piping plover restoration, and a fish run project. The<br />
defendants also paid the agencies their assessment costs. 11<br />
b. CERCLA<br />
Bunker Hill Superfund Site: United States, the State of Idaho and the Coeur D’Alene Tribe<br />
(collectively “Plaintiffs”) entered into an agreement with the Union Pacific Corporation which,<br />
among other things, will require Union Pacific to cap the former track area of its rail line and<br />
create a recreational trail along the 71.5 mile line across most of the panhandle of Idaho. Union<br />
Pacific will also pay Plaintiffs’ response costs and another $2,000,000 to the natural resource<br />
trustees in settlement of claims for natural resource damages, $2,730,000 to the State and Tribe<br />
as future owners of the right-of-way, and $35,000 for use by Plaintiffs in funding educational<br />
activities related to the response action.<br />
Fort Wayne Reduction Superfund Site: In order to resolve claims that they damaged natural<br />
resources along the south bank of the Maumee River near Fort Wayne, Indiana, approximately<br />
87 parties responsible for releases of hazardous substances at or from the Fort Wayne Reduction<br />
Superfund Site agreed to implement a restoration plan under which, among other things, they<br />
will acquire approximately 75 acres of land adjacent to the Maumee. Once they have acquired<br />
that land, they will reforest and restore almost two-thirds of it, place a conservation easement on<br />
it, and convey it to the Indiana Department of Natural Resources.<br />
10 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2000 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.govienrd/Electronic_Reading_Room/lit_Accomplish 2000.html.<br />
11 See, also, Case: Barge North Cape Oil Spill, NOAA Damage Assessment, Remediation, and Restoration Program<br />
Press Release (7/6/00), available at http://www.darrp.noaa.gov/northeast/north cape/ncdoipr.html; Restoration<br />
Settlement Reached for the North Cape Oil Spill, NOAA Press Release 99-R426 (12/22/99).<br />
DC1 1763595v.1<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 7<br />
Tex Tin Superfund Site: Bankrupt Tex Tin and its related and affiliated entities resolved the<br />
United States’ and the state of Texas’ claims for response costs and natural resource damages by<br />
agreeing to pay $1 million in past response costs related to the site, $225,000 for <strong>NRD</strong>, and<br />
$300,000 to fund a custodial trustee for the care and maintenance of the property. 12<br />
2. 2001 13<br />
a. Park System Resource Protection Act<br />
Biscayne National Park: The United States achieved the largest natural resource damage<br />
recovery to date under the Park System Resource Protection Act when it reached a settlement for<br />
damages arising out of the grounding of the vessel M/V Igloo Moon in Biscayne National Park<br />
off the coast of Florida. The grounding caused significant damage to the coral reef habitat in the<br />
Park. The $1 million recovery will cover the full cost of primary restoration as well as other<br />
compensable costs.<br />
b. OPA<br />
Puerto Rico: The United States reached an agreement with the owners, operators and insurers<br />
of a barge carrying 1.5 million tons of oil that ran aground off the coast of Puerto Rico, to<br />
address the damages caused when the barge crushed the reef and spilled 800,000 gallons of oil.<br />
Much of the oil was discharged onto nearby land, affecting beaches and parklands in Puerto<br />
Rico. Under the settlement, $60 million will be deposited in the Oil Spill Liability Trust Fund,<br />
which financed the clean up, and an additional $23.5 million will be paid to settle the federal and<br />
state trustees’ claims for natural resource damages. It is expected that the trustees’ recoveries<br />
will be used to restore reef injured in the incident and to acquire land to enhance conservation,<br />
ecosystem preservation, habitat maintenance and recreational opportunities in the beach areas<br />
affected by the spills.<br />
c. CERCLA<br />
Montrose Chemical Co.: The United States reached a settlement with the remaining defendants<br />
in an action involving DDT contamination of the ocean off the coast of Los Angeles. The<br />
contamination resulted from the discharge of approximately 1800 tons of DDT from a Montrose<br />
Chemical Co. manufacturing facility into Los Angeles County sewers that empty into the Pacific<br />
Ocean, creating the largest known area of DDT contamination in the world. Under the<br />
settlement, defendants will pay $73 million, of which $30 million will be used to restore natural<br />
resources damaged by the contamination. This recovery, together with previous recoveries from<br />
other defendants, brings the total amount recovered for environmental restoration in this area to<br />
$137.5 million. The funds will be used by federal and state trustees on projects such as artificial<br />
12 65 <strong>Fe</strong>d.Reg. 37410.<br />
13 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2001 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.gov/enrd/Electronic Reading Room/lit Accomplish 2001.html.<br />
DC1 1763595v.1<br />
7<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 8<br />
reefs to provide new habitat for fish and a program to reintroduce bald eagles and peregrine<br />
falcons to <strong>Santa</strong> Catalina and the other Channel Islands. 14<br />
Summitville Mine Site in Colorado: Robert Friedland, the financier, major stockholder,<br />
chairman, CEO and director of the owner corporation, Summitville Consolidated Mining<br />
Company, Inc. and its parent Galactic Resources Ltd. Pursuant to the settlement, Friedland<br />
agreed to pay $5 million to restore natural resources damaged by arsenic contamination.<br />
Iron Mountain Mine Superfund Site: Aventis CropSciences USA, Inc. paid federal and state<br />
trustees $10 million for natural resource restoration projects as part of cleanup costs that could<br />
approach $1 billion at the Iron Mountain Mine Superfund Site near Redding, California. The<br />
settlement is one of the largest settlements with a single private party in the history of the federal<br />
Superfund program. Through the creation of a unique funding vehicle that will generate $200-<br />
300 million over 30 years with a $514 million balloon payment in year 30, the settlement assures<br />
that money is available each year for long-term operation of a pollution treatment and control<br />
system needed to prevent toxic discharges from the site. This site has been one of the largest<br />
point sources of toxic metals in the United States, and the source of the most acidic mine<br />
drainage in the world.<br />
Guide Corporation: The Guide Corporation agreed to pay more than $10 million to settle a<br />
civil lawsuit over one of the largest fish kills in Indiana history. Guide, an automotive lighting<br />
manufacturer, discharged toxic wastewater from an automotive parts facility to the Anderson,<br />
Indiana sewage treatment plant which, in turn, discharges into the White River. Under the<br />
settlement, Guide agreed to pay $6 million into two White River restoration funds, $2 million to<br />
reimburse the costs of agencies that responded to the fish kill, and $2 million in civil penalties.<br />
Niagara Falls Superfund Site: Under a settlement with Goodyear Tire & Rubber Co., a<br />
polluted, abandoned trailer park in western New York State will be cleaned up and redeveloped.<br />
EPA relocated residents in 1989 after discovering that residents of the mobile homes were living<br />
on top of and even playing with chunks of hazardous waste. Goodyear will clean up the site,<br />
reimburse the government for its costs and compensate for damages to natural resources<br />
resulting from the contamination.<br />
Lone Mountain Site: Lone Mountain Processing, Inc. agreed to pay $2,450,000 to resolve<br />
<strong>NRD</strong> claims arising from coal slurry spills to the Powell River Watershed from a coal processing<br />
plant in Lee County, Virginia. 15<br />
14 Sacramento Fish and Wildlife Office, Montrose Superfund Site: Channel Islands Restoration, available at<br />
http://www.fws.gov/sacramento/ec/montrose.htm.<br />
15 66 <strong>Fe</strong>d. Reg. 2445 (1/11/01).<br />
DC1 1763595v.1<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 9<br />
3. 2002 16<br />
a. OPA<br />
<strong>Santa</strong> Clara River: The United States settled claims against ExxonMobil Oil Corporation<br />
relating to a spill of crude oil from a pipeline in Los Angeles County that fouled a 15-mile stretch<br />
of the <strong>Santa</strong> Clara River. The spill killed aquatic life in the River, including an endangered<br />
species of fish, as well as causing extensive habitat damage. The settlement requires ExxonMobil<br />
to pay the United States and the State of California a total of $4.7 million, most of which will be<br />
used to preserve and restore habitat in the River and other natural resources injured by the spill.<br />
b. CERCLA<br />
Fox River and Green Bay: The United States lodged a consent decree settling claims for<br />
damages to natural resources caused by extensive PCB contamination in sediments of<br />
Wisconsin’s Fox River and Green Bay. The settlement with one of several major parties<br />
responsible for the contamination will provide more than $10.8 million for extensive natural<br />
resource restoration work, including the preservation of more than 1000 acres of wildlife habitat<br />
in northeastern Wisconsin, $8.5 million for other restoration projects, and $1.6 million to offset<br />
the assessment and cleanup-related response costs incurred by the United States and the state of<br />
Wisconsin. Two States and two Indian tribes joined in the settlement. The Oneida Tribe of<br />
Indians of Wisconsin and the Menominee Indian tribe of Wisconsin were additional parties to the<br />
settlement as Tribal Trustees. The eventual cleanup and <strong>NRD</strong> restoration costs are expected to<br />
exceed one billion dollars. 17<br />
Krejci Dump Site in Summit County, Ohio: Three consent decrees were entered concluding<br />
the Division’s CERCLA action on behalf of the National Park Service to secure cleanup of the<br />
Krejci Dump Site in Summit County, Ohio. The site is located within the Cuyahoga Valley<br />
National Park and was formerly used as an industrial dump and scrap yard. Under the first<br />
decree, Ford Motor Co. and General Motors Corp., who had sent waste to the site, agreed to<br />
perform the long-term remedy valued at approximately $29 million. In the second decree, five<br />
additional companies who sent waste to the site agreed to pay $4.3 million toward cleanup and<br />
$477,500 toward natural resource restoration. The third decree resolved the liability of 3M<br />
Company, the only defendant who refused to settle prior to trial. After 3M was adjudged liable<br />
under CERCLA for cleanup costs, it agreed to pay the Department of Interior $15.5 million to<br />
reimburse the government’s costs.<br />
Fruit of the Loom, MU Land Management, and Velsicol Chemical Corp: A court approved<br />
the bankruptcy settlement with debtors under which the debtors will transfer the portions of<br />
seven Superfund sites that they own to an independent custodial trust and will also dedicate<br />
assets to fund cleanup actions and natural resource damage restoration for the seven sites.<br />
Among the assets committed to address these environmental liabilities are $4,292,808 in cash,<br />
16 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2002 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.gov/enrd/Electronic Reading Room/lit Accomplish 2002.html.<br />
17 67 <strong>Fe</strong>d.Reg. 44877 (7/5/02).<br />
DC1 1763595v.1<br />
9<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 10<br />
proceeds from general liability insurance claims estimated to be worth $20 to 30 million,<br />
recoveries from preferred shares of stock in Velsicol’s parent corporation, and proceeds from<br />
defendants’ cost overrun insurance policies. Illinois, Michigan, New Jersey, and Tennessee were<br />
also parties to the settlement.<br />
4. 2003 18<br />
a. OPA<br />
Patuxent River: Potomac Electric Power Co. (PEPCO) and ST Services entered into a consent<br />
decree relating to a 140,000 gallon oil spill from a ruptured pipeline into a tributary of<br />
Maryland’s Patuxent River, which affected environmentally sensitive areas including wetlands<br />
and habitat for fish and resident and migratory birds and prompted emergency responses from<br />
federal and state agencies. The consent decree recovers $2.7 million for damages to natural<br />
resources and the payment of a $2 million penalty to the State of Maryland, in addition to a<br />
previously issued emergency order requiring PEPCO to conduct oil recovery operations at an<br />
estimated cost of $71 million.<br />
b. CERCLA<br />
Koch Pipeline Company: The United States obtained the largest ever civil environmental<br />
penalty in Iowa when it settled with Koch Pipeline Company for damages caused by a ruptured<br />
pipeline that released about 312,800 pounds of anhydrous ammonia in liquid and gas forms. As<br />
part of the settlement, Koch agreed to pay a $1 million penalty to the United States and $450,000<br />
to the State of Iowa for penalties and natural resource damages.<br />
5. 2004 19<br />
a. OPA<br />
East Walker River Spill: Advanced Fuel Filtration Systems agreed to pay $350,000 to the DOI<br />
<strong>NRD</strong>AR fund to be used to restore, rehabilitate or acquire the equivalent of resources injured by<br />
the December 30, 2000 spill of approximately 6100 gallons of fuel oil into the East Walker<br />
River, and to compensate the public for lost recreational opportunities. In addition, Advanced<br />
Fuel agreed to reimburse the California Department of Fish and Game $68,000 for past<br />
assessment costs, and reimburse the DOI $50,000 for assessment costs. 20<br />
18 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2003 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.gov/enrd/Electronic_Reading_Room/lit_Accomplish 2003.html.<br />
19 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2004 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.gov/enrd/Electronic Reading Room/lit Accomplish 2004.html.<br />
20 69 <strong>Fe</strong>d.Reg. 3390 (1/23/04).<br />
DC1 1763595v.1<br />
10<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 11<br />
b. CERCLA<br />
Grand Calumet River and Indiana Harbor Canal: Eight companies which will pay nearly<br />
$60 million to restore natural resources in the Grand Calumet River and Indiana Harbor Canal.<br />
Although located in one of the most heavily industrialized areas of the country, the river and<br />
canal support a variety of fish and wildlife. Interspersed among the area’s factories, housing<br />
developments and refineries are remnants of important natural features including globally rare<br />
dune and swale habitat, prairie wetlands, savannas, marshes and swamps, as well as the Indiana<br />
Dunes National Lakeshore. <strong>Fe</strong>deral and state agencies worked cooperatively to determine the<br />
extent of damage from a century of industrial releases of oil and other hazardous substances into<br />
the waterway. The proposed settlement provides more than $53 million to clean up, restore and<br />
protect the waterways and surrounding areas, protect permanently 233 acres of land that contain<br />
important fish and wildlife habitat, and pay $2.7 million to state and federal agencies to<br />
reimburse them for damage assessment costs.<br />
White River Fish Kill, Anderson, Indiana: Crown EG, Inc. agreed to pay $250,000 into a<br />
White River restoration fund to resolve <strong>NRD</strong> claims brought by the United States and the state of<br />
Indiana for CWA and state law violations, as well as <strong>NRD</strong> arising from the discharge of<br />
industrial wastewater by Crown and Guide Corporation that caused a December, 1999 fish kill.<br />
Guide <strong>final</strong>ized a separate consent decree in September, 2001. 21<br />
6. 2005 22<br />
In 2005, the United States secured <strong>NRD</strong> settlements worth over $87 million in U.S. v. Holyoke<br />
Water Supply Company, US. v. France Shipmanagement S.A., US. v. Olympic Pipeline, U.S. v.<br />
ALCOA, U.S. v. Chevron U.S.A. Inc., U.S. v. County of <strong>Santa</strong> Clara, and U.S. v. Marathon Oil.<br />
a. OPA<br />
Marathon Oil Indiana Pipeline Spills: Under the terms of the consent decree, Marathon Oil<br />
Company and Marathon Ashland Pipe Line LLC conveyed 56.54 acres of riparian flood plain<br />
habitat to the Indiana Department of Natural resources for replacement or acquisition of the<br />
equivalent of injured natural resources, paid the United States and the state of Indiana<br />
$24,220.10 for assessment costs, and paid $5,779.90 to be used for future restoration of the 56.64<br />
acre property 23<br />
John Heinz National Wildlife Refuge: The United States settled claims for civil penalties and<br />
natural resource damages against Sunoco, Inc. and Sun Pipe Line Company resulting from a<br />
discharge of approximately 4,571 barrels of crude oil from Sunoco’s pipeline into a 145-acre<br />
wetland impoundment within John Heinz National Wildlife Refuge in Philadelphia. The spill<br />
lasted for 3 days before it was detected. Sunoco paid a penalty of $2,742,600 and damages of<br />
21 69 <strong>Fe</strong>d.Reg. 12867 (3/18/04).<br />
22 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2005 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdolgov/enrd/Electronic Reading Room/E<strong>NRD</strong> 2005 Accomplishments Report.pdf.<br />
23 70 <strong>Fe</strong>d.Reg. 17469 (4/6/05); see, also, http://www.in.gov/dnr/press/Marathon-Rosedale-Settlement.pdf.<br />
DC1 1763595v.1<br />
11<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 12<br />
$865,000. During negotiations, Sunoco performed all necessary remedial and preventive<br />
measures, funded assessment of natural resource damages, and performed restoration measures<br />
at the Refuge to restore and replace the damaged resources.<br />
Equinox Oil Co.: The United States and the state of Louisiana settled a claim in bankruptcy<br />
under which the successor in interest, Elysium Energy, L.L.C. agreed to pay $1.2 million to<br />
resolve <strong>NRD</strong> claims arising from a well blowout that discharged oil into the waters of Lake<br />
Grand Ecaille in Plaquemines Parish, Louisiana. The settlement included the costs to implement<br />
restoration projects on property located near the location of the oil spill, past assessment costs,<br />
and estimated future restoration costs. The Coast Guard’s removal costs were previously paid. 24<br />
b. CERCLA<br />
Kerr-McGee: Kerr-McGee Chemical, Inc. agreed to perform remedial action and natural<br />
resource restoration work valued at $74 million, pay $6 million for past costs, reimburse all<br />
future costs for non-oversight activities, and pay $1.685 million for oversight costs at its West<br />
Chicago Site.<br />
Morning Star Mine Site: Vanderbilt Gold Corp. (“VGC”) and Mineral, Metal & Mining<br />
Management Co. (“4EM”) agreed to perform a removal action; reimburse DOI, over time, for<br />
approximately $1 million in past response costs; pay DOI’s future response costs; and pay $1<br />
million, over time, into DOI’s <strong>NRD</strong>AR fund to restore, replace, or acquire the equivalent of Park<br />
System resources injured by VGC. The site is an inactive open pit mine located in the Mojave<br />
National Preserve. 25<br />
7. 2006 26<br />
In 2006, the United States secured <strong>NRD</strong> settlements worth over $33 million in matters including<br />
U.S. v. Schlumberger Technology Corp. ($11,960,000 payment to DOI’s Assessment and<br />
Restoration Fund and $537,501 to reimburse the Trustees for past costs and future costs to be<br />
incurred; completion of removal of two dams on Twelvemile Creek as restoration project), 27 U.S.<br />
v. Elkem Metals Co., U.S. v. Sunoco, Inc., U.S. v. American Energy, Inc. and U.S. v. BP Amoco<br />
Chemical Co. The states of South Carolina and Georgia joined the United States as co-plaintiffs<br />
in Schlumberger; Ohio and West Virginia were co-plaintiffs in Elkem Metals, Kentucky was a<br />
co-plaintiff in Sunoco, and Texas was a co-plaintiff in the case against BP Amoco. Restoration<br />
activities included the removal of two dams, dredging PCB contaminated sediments behind the<br />
dams, and improving the stream corridor leading to Lake Hartwell in South Carolina<br />
(Schlumberger); the restoration of mussels, fish, and snails damaged by releases of hazardous<br />
substances to the Ohio River (Elkem); the preservation of at least 100 acres of bottomland<br />
hardwood forest habitat, the re-colonization of 19 acres of former pasture with native vegetation,<br />
24 <strong>Fe</strong>d.Reg. 69586 (11/16/05).<br />
25 70 <strong>Fe</strong>d.Reg. 17469 (4/6/05).<br />
26 United States Department of Justice, Environment and Natural Resources Division, Fiscal Year 2006 Summary<br />
of Litigation Accomplishments, available at<br />
http://www.usdoj.gov/enrd/Electronic_Reading_Room/E<strong>NRD</strong>_2006_Accomplishments_Report.pdf.<br />
27 71 <strong>Fe</strong>d.Reg. 6792 (2/9/06).<br />
DC1 1763595v.1<br />
12<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 13<br />
and the creation of six acres of riparian wetland in the vicinity of two Superfund sites in Harris<br />
County, Texas (BP Amoco).<br />
Fox River: In June 2006, NCR and Appleton Papers agreed to provide $5 million for restoration<br />
work in the Fox River, following mediation. They also agreed to make a $500,000 payment as<br />
partial reimbursement of damage assessment and project implementation costs. 28<br />
Commencement Bay: In May, 2006, NR Trustees the State of Washington, the Puyallup Tribe<br />
of Indians, the Muckleshoot Indian Tribe, NOAA, and DOI settled <strong>NRD</strong> claims against thirtytwo<br />
PRPs. The settlement provided reimbursement to the trustees of $1,793,888.46 in<br />
assessment costs, $150,000 for oversight costs, and will fund the construction of a habitat<br />
restoration project in Pierce County, Washington. 29 Also in 2006, PRP Glacier Northwest, Inc.<br />
resolved its <strong>NRD</strong> liability to the trustees in the Hylebos Waterway of Commencement Bay for<br />
$187,512 in <strong>NRD</strong> and $20,804.24 in assessment costs, and PRP Streich Bros., Inc. resolved its<br />
<strong>NRD</strong> liability in the Hylebos Waterway for $181,948 in <strong>NRD</strong> and $20,189.15 in assessment<br />
costs. To settle the Hylebos <strong>NRD</strong> claims, NOAA’s Robert A. Taylor, Office of General<br />
Counsel, developed an innovative settlement strategy involving a restoration-based approach,<br />
independent liability allocation, a public review and comment process, and restoration credits<br />
trading. This project was the first nationally to include a formal liability allocation, and the first<br />
to employ restoration credits trading.<br />
8. 2007<br />
a. OPA<br />
Kinder Morgan Oil Spills: Kinder Morgan Energy Partners L.P. and SFPP L.P. have agreed to<br />
pay nearly $5.3 million and to spend $26 million for pipeline improvements to resolve liability<br />
for three oil spills in 2004 and 2005 in California. The proposed settlement, which addresses<br />
discharges of 200,976 of diesel fuel, jet fuel, and gasoline into water and sensitive ecosystems<br />
including Suisun Marsh, the largest saltwater wetland in the western United States, includes $1.3<br />
million for <strong>NRD</strong>. 30 b. CERCLA<br />
ASARCO LLC: In August 2007, the Justice Department reached an agreement settling its<br />
CERCLA claims, including its <strong>NRD</strong> claims, with mining company ASARCO LLC at the<br />
California Gulch site in Leadville, Colorado. The government originally claimed damages of<br />
$76.7 million, including $65.4 million in damages and $11.3 million as reimbursement for <strong>NRD</strong><br />
assessment costs. ASARCO’s expert estimated its share of <strong>NRD</strong> liability at $520,000. The<br />
government’s expert, Dr. Josh Lipton, based his estimate on his opinion that the river into which<br />
28 United States v. Appleton Papers, Inc. (No. 01-C-0816; filed January 24, 2006).<br />
29 71 <strong>Fe</strong>d.Reg. 24760.<br />
30 Linda Roeder, “EPA Says Pipeline Companies Will Pay $31.3 million Under Proposed Agreement,” BNA<br />
Environment Reporter (5/25/07), available at http://pubs.bna.com/ip/bna/ENR.NSF/eh/a0b4n7w0w5 [subscription<br />
required]; see, also, “California Oil Spills Cost Kinder Morgan $5.3 Million,” Environmental News Service<br />
Newswire (6/4/07), available at http://www.ens-newswire.com/ens/jun2007/2007-06-04-09.asp.<br />
DC1 1763595v.1<br />
13<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 14<br />
ASARCO had deposited tailings was so degraded that it was “not performing any ecological<br />
services.” The Debtor’s expert, in contrast, estimated that baseline conditions in the river were<br />
so poor that the Debtor’s contribution to degradation of the river was minimal. The experts also<br />
offered vastly different opinions regarding recovery time for the resources impacted (in some<br />
cases, 5 versus 100 years).<br />
Following mediation, the parties agreed to allow general unsecured claims in the bankruptcy of<br />
$10 million for <strong>NRD</strong> damages and <strong>NRD</strong> assessment. Joint Venture partner Newmont Mining,<br />
which had operated mines with ASARCO, agreed to pay $10.5 million in cash. The bankruptcy<br />
court subsequently granted preliminary approval of the settlement.<br />
Lavaca Bay, Aransas National Wildlife Refuge: Alcoa completed a 15-year restoration<br />
project that involved the creation of a 70-acre intertidal marsh on 730 acres Alcoa acquired and<br />
will transfer to the Aransas National Wildlife Refuge. The project was part of the terms of a<br />
settlement to resolve Alcoa’s liability arising from releases of mercury and hydrocarbons into the<br />
bay in the late 1960s. Alcoa has spent $110 million in remediation and restoration projects. 31<br />
Spectron, Inc.: In January 2007, EPA reached a settlement with 95 parties at the Spectron, Inc.<br />
Superfund Site in Elkton, Maryland. The settlement included a commitment by the settling<br />
parties to conduct a cleanup estimated at $19.5 million, to reimburse EPA $1.8 million in past<br />
costs, and to pay $507,300 to the National Resource Trustees to restore aquatic habitat.<br />
Yeoman Creek Landfill Superfund Site: Environmental cleanup work was completed by<br />
several responsible parties under the terms of a 1999 consent decree. Under a proposed consent<br />
decree lodged on January 31, 2007 an additional $600,000 will be paid for <strong>NRD</strong> and<br />
reimbursement of <strong>NRD</strong> assessment costs by (1) Browning-<strong>Fe</strong>rris Industries, LLC and BFI Waste<br />
Systems of North America; (2) the City of Waukegan, Illinois; (3) Abbott Laboratories; (4)<br />
Waukegan Community School District No. 60; (5) Goodyear Tire & Rubber Co., and (6)<br />
Invitrogen Corp. 32<br />
United States v. Agere Systems, Inc.: Under the terms of a proposed consent decree, 98<br />
settling defendants agreed to finance and perform the surface remedy selected for the site and to<br />
pay $507,300 to state and federal Trustees to resolve <strong>NRD</strong> claims relating to the site. The<br />
settling defendants also agreed to finance and perform a future, yet unknown, groundwater<br />
remedy, provided that the cost estimate for the selected remedy for operable unit 2 does not<br />
exceed $10 million. 33<br />
31 NOAA Press Release, “Land Goes Back to Nature” (3/29/07), available at<br />
http://www.darrp.noaa.gov/lavacastory.html.<br />
32 72 <strong>Fe</strong>d.Reg. 7460 (2/15/07).<br />
33 72 <strong>Fe</strong>d.Reg. 4725 (2/1/07).<br />
DC1 1763595v.1<br />
14<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 15<br />
9. 2008<br />
a. CERCLA<br />
Dana Corp.: In June 2008, the Justice Department reached an agreement to resolve<br />
environmental claims in the bankruptcy of Dana Corp. The settlement, which involved six<br />
superfund sites in five states, included $3,120,000 allocated to the Departments of Commerce<br />
and Interior for natural resource restoration and assessment.<br />
C. Washington<br />
BNSF Skykomish (Former Maintenance and Fueling Facility): Under the terms of a<br />
proposed consent decree, BNSF will complete a $50 million, four-year comprehensive clean-up<br />
of bunker C and diesel fuel from historic railyard operations that contaminated soils,<br />
groundwater, and Skykomish River sediments; and pay $5.5 million to settle its <strong>NRD</strong> liability<br />
with the state of Washington. The $5.5 million will be used to restore natural resources and<br />
compensate for lost recreational opportunities as follows: $2.5 million for fish and aquatic<br />
habitat protection and restoration in the Skykomish and Snohomish watersheds; $1.5 million<br />
toward the town of Skykomish’s planned wastewater treatment project to protect ground and<br />
surface water quality; and $1.5 million for terrestrial and waterfowl habitat projects and<br />
compensation for lost recreational opportunities (this $1.5 million includes a credit of $350,000<br />
for levee improvements already completed, $50,000 for in-kind services done in coordination<br />
with the town, and $50,000 is dedicated to address turbidity violations that occurred in the<br />
cleanup of the levee in 2006). 34<br />
D. New Jersey<br />
Between the inception of New Jersey’s program in 1993 the end of 2003, the New Jersey Office<br />
of Natural Resource Restoration (ONRR) settled oil spill and hazardous waste site cases that<br />
totaled more than $42,000,000 in natural resource damages. 35<br />
34 BNSF Skykomish Fact Sheet (June 2007), available at http://www.ecy.wa.gov/pubs/0709043.pdf.<br />
35 NJDEP ONRR 2003 Settlement/Restoration Report, available at<br />
http://www.nj.gov/dep/nrr/reports/nrd_update2003l2.pdf.<br />
DC1 1763595v.1<br />
15<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 16<br />
1. Oil Spill Cases<br />
Spill/Discharge<br />
Exxon Bayway: 567,000<br />
gallons of No. 2 oil<br />
spilled into Arthur Kill<br />
(1/90)<br />
BT Nautilus: 280,000<br />
gallons No. 6 oil spilled<br />
into Kill van Kull (6/90)<br />
Anitra: 42,000 gallons<br />
Nemba and Cabinda<br />
crude spilled into<br />
Delaware Bay (5/96)<br />
President Rivera:<br />
306,000 gallons No. 6<br />
oil spilled into Delaware<br />
River (3/89)<br />
Sun Pipeline: gas<br />
pipeline rupture/fire<br />
(Princeton), D & R<br />
Canal, Princeton (1/86)<br />
Cibro/Montauk: 100,000<br />
gallons No. 2 oil spilled<br />
into Arthur Kill (3/90)<br />
Stolthaven: gas pipeline<br />
rupture into Woodbridge<br />
Creek (4/98)<br />
Cynthia M: 160,000<br />
gallons NaOH spilled<br />
into Hackensack River<br />
(3/94)<br />
Date of Injury<br />
Settlement<br />
3/1/91 Lost public use<br />
Fisheries<br />
Wetlands<br />
Wading Birds<br />
Waterfowl<br />
3/13/95 Lost public use<br />
Wetlands<br />
Endangered<br />
species<br />
Endangered<br />
species<br />
Migratory<br />
birds<br />
1994 Lost public use<br />
Fisheries<br />
Wetlands<br />
1997 Old growth<br />
forest<br />
Neotropical<br />
birds<br />
1/27/99 Lost public use<br />
Wetlands<br />
Settlement/Restoration<br />
$5.78 million to NJ Trustee<br />
committee over site;<br />
200 acre wetland/upland<br />
restoration Jersey City);<br />
25 acre acquisition (Edison);<br />
32 acre marsh restoration<br />
(Careteret);<br />
Wading bird research;<br />
Harbor wildlife inventory GIS<br />
$1.56 million settlement;<br />
80 acre marsh restoration (Jersey<br />
City);<br />
Interpretive Center at Island Beach<br />
State Park;<br />
Piping Plover restoration (Atlantic<br />
Coast)<br />
$1.5 million settlement;<br />
Migratory bird management and<br />
protection;<br />
Habitat restoration and acquisition<br />
$1.1 million settlement;<br />
40 acre wetland restoration<br />
(Alloway);<br />
182 acre acquisition (Alloway);<br />
Fort Mott pier restoration ;<br />
186 acre acquisition (Stow Creek)<br />
$455,000 settlement;<br />
5 acre forest restoration;<br />
Neotropical bird research<br />
$240,000 settlement<br />
3/01 Wetlands $65,000 settlement<br />
9/24/98 Fisheries $50,000 settlement;<br />
80 acre restoration (Jersey City)<br />
DC1 1763595v.1<br />
16<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 17<br />
Spill/Discharge<br />
Burlington Asphalt:<br />
10,000 gallons No. 2. oil<br />
spilled (1/94)<br />
Jahre Spray: 56,000<br />
gallons Rabi crude oil<br />
spilled into Delaware<br />
River (7/95)<br />
TK Transport: 6,000<br />
gallons of gasoline<br />
spilled into wetlands<br />
(Mt. Laurel) (1/01)<br />
M/V Kentucky: 13,000<br />
gallons of light crude<br />
spilled into Delaware<br />
River (7/94)<br />
Bouchard B155: 2,000<br />
gallons No. 2 oil spilled<br />
into Delaware Bay<br />
(10/96)<br />
CCMUA: 15 million<br />
gallons of sewage<br />
spilled into Big Timber<br />
Creek (Glouchester<br />
Twp) (6/94)<br />
Terminal Ventures:<br />
Discharge of 500 gallons<br />
of No. 6 oil into the<br />
Hackensack River<br />
(9/10/99)<br />
Moramac Marine<br />
Transport: 20,000<br />
gallons No. 2 oil spilled<br />
into Sandy Hook<br />
Channel (2/95)<br />
Date of<br />
Settlement<br />
Injury Settlement/Restoration<br />
2/97 $50,000 settlement;<br />
30 acre acquisition (Pemberton)<br />
along Rancocas Creek;<br />
Hiking trail<br />
construction/maintenance<br />
2/13/01 Wetlands $51,000 settlement;<br />
Fisheries 47 acre acquisition of<br />
wetlands/Bald Eagle habitat<br />
7/26/02 Wetlands $35,000 settlement to do<br />
monitoring of wetlands<br />
3/27/96 Fisheries<br />
Wetlands<br />
Assessment costs ($6,000);<br />
$27,000 settlement (to<br />
Pennsylvania)<br />
1997 Wetlands $18,000 settlement;<br />
Boom anchor project 36<br />
7/99 Lost public use<br />
Fisheries<br />
4/10/00 Wetlands<br />
Mudflats<br />
Erosion control project;<br />
Endangered species protection<br />
(Glouchester);<br />
Assessment costs of $25,000<br />
$24,979 settlement;<br />
Habitat restoration or boom anchor<br />
project<br />
4/16/97 Fisheries $22,000 settlement combined with<br />
other settlements for restoration of<br />
Raritan Bay<br />
36 Boom anchor projects generally entail the placement of permanent structures, usually pilings or buoys, where<br />
floating deflection boom can be attached during an oil spill. Placing such structures at the mouths of rivers and<br />
creeks allows for rapid deployment of boom during oil spills, thus protecting upstream wetlands and associated<br />
wildlife.<br />
DC1 1763595v.1<br />
17<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 18<br />
Spill/Discharge<br />
Mystra: 5,000 gallons<br />
Brent crude oil spilled<br />
into Delaware Bay<br />
(9/97)<br />
New Ideal: 2,000<br />
gallons of No. 6 oil<br />
spilled into Delaware<br />
Bay (10/98)<br />
Travelodge: 1,000<br />
gallon No. 2 oil spilled<br />
into tributary of<br />
Pennsauken Creek<br />
(3/00)<br />
Spring Bee: 550 gallons<br />
of lube oil spilled into<br />
Delaware River<br />
(Camden) (3/99)<br />
Sun Pipeline: 20,000<br />
gallons of gasoline<br />
spilled into Doty’s<br />
Creek, Piscataway<br />
(12/97)<br />
Harrah’s: 1,500 gallons<br />
No. 2. oil spilled into<br />
Absecon Inlet (1/97)<br />
Coastal Eagle: 500<br />
gallons of JP-4 spilled<br />
into the Delaware River<br />
(12/98)<br />
Vane Brothers: 1,000<br />
gallons No. 6 oil spilled<br />
into Pennsauken Creek<br />
(5/98)<br />
Date of<br />
Settlement<br />
Injury Settlement/Restoration<br />
5/4/98 Fisheries $19,000 settlement;<br />
Boom anchor project<br />
5/12/99 Wetlands $15,034 settlement<br />
6/22/02 Small stream $8,500 settlement;<br />
3 year monitoring of stream<br />
recovery, Mount Holly<br />
5/99 Wetlands $3,594 settlement;<br />
Boom anchors, Newton Creek<br />
4/13/99 Small stream 3 year monitoring of stream<br />
recovery, extensive stream<br />
revegetation and trash removal<br />
conducted by Sun<br />
5/97 Wetlands 2 year marsh recovery, monitoring<br />
by Harrah’s<br />
5/19/00 Wetlands 3 sets of boom anchors installed by<br />
Coastal (Westville, Glouchester)<br />
1/25/99 Wetlands 3 sets boom anchors installed by<br />
Vane Brothers (Pennsauken)<br />
2. Hazardous Waste Site Cases<br />
Site<br />
Hudson/Essex County<br />
Chromium Sites<br />
Settlement<br />
Date<br />
Injury Settlement<br />
11/03 Groundwater $17 million settlement;<br />
Open space/aquifer recharge<br />
acquisition/watershed<br />
improvement<br />
DC1 1763595v.1<br />
18<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 19<br />
Site<br />
Chemical Leaman<br />
Superfund Site<br />
Settlement Injury<br />
Date<br />
8/20/02 Groundwater<br />
Wetlands<br />
Settlement<br />
$4.2 million settlement;<br />
46 acre acquisition of Liberty<br />
Property, includes Bald Eagle<br />
habitat and nests;<br />
96 acre acquisition of forested<br />
wetland and Bald Eagle habitat<br />
Celotex Park Ground water $3.4 million settlement;<br />
Open space/aquifer recharge<br />
acquisition<br />
GEMS Landfill<br />
Superfund<br />
8 Sites DuPont de<br />
Nemours and Company<br />
[At the time of the<br />
settlement, was the<br />
largest in-kind<br />
"resource-to- resource"<br />
compensation package<br />
ever obtained by the<br />
state for <strong>NRD</strong>]<br />
Caldwell Trucking<br />
Superfund Site<br />
7/96 Groundwater<br />
Site Wetlands<br />
Endangered<br />
Species<br />
5/97 Groundwater<br />
Wetlands<br />
12/94 Groundwater<br />
Wetlands<br />
$2.3 million settlement;<br />
59 acre acquisition (Glouchester);<br />
63.25 acre acquisition<br />
(Glouchester);<br />
56 acre recharge area acquisition<br />
(Deptford);<br />
Fisheries research<br />
Conservation easements on four<br />
undeveloped, uncontaminated<br />
parcels;<br />
Donated two undeveloped,<br />
uncontaminated properties in the<br />
same watershed as the<br />
contaminated sites;<br />
Construction of boat ramp and<br />
access road;<br />
$500,000 toward the acquisition of<br />
350 undeveloped, forested<br />
property in Cape May County<br />
(aquifer recharge and wildlife<br />
habitat);<br />
$1.8 million for urban shade<br />
plantings;<br />
$500,000 to restore wetland habitat<br />
or purchase aquifer recharge areas.<br />
$984,000 settlement;<br />
Branch Brook Park stream<br />
embankment project ($135,000);<br />
16 acre recharge area/habitat<br />
acquisition (Montville);<br />
10 acre recharge area/habitat<br />
acquisition (Parsippany);<br />
Funding for local water<br />
distribution infrastructure<br />
enhancements (Fairfield)<br />
DC1 1763595v.1<br />
19<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 20<br />
Site<br />
Settlement Injury Settlement<br />
Date<br />
East Hanover Regional<br />
Ground Water<br />
Contamination<br />
5/02 Groundwater $1 million settlement;<br />
open space/aquifer recharge<br />
acquisition<br />
Chemsol Superfund Site 7/26/99 Ground water $650,000 settlement;<br />
Acquisition of aquifer<br />
recharge/upland habitat<br />
Evor Phillips 5/02 Groundwater $390,600 settlement;<br />
Open space/aquifer recharge<br />
acquisition<br />
Washington Auto 11/25/98 Groundwater $342,000 settlement;<br />
50 acre acquisition of aquifer<br />
recharge (High Bridge)<br />
Shieldalloy Superfund<br />
Site<br />
Combe Fill South<br />
Superfund Site, de<br />
minimis Settlement<br />
1997 Groundwater<br />
Wetlands<br />
Multiple<br />
parties/various<br />
dates<br />
Groundwater<br />
Fisheries<br />
Public lost use<br />
$302,000 settlement;<br />
15 acre wetland restoration<br />
(Newfield);<br />
173 acre recharge area/habitat<br />
acquisition (Pittsgrove);<br />
74 acre recharge area/habitat<br />
acquisition (Winslow)<br />
$269,500 settlement;<br />
Open space/aquifer recharge<br />
acquisition/watershed<br />
improvement<br />
Carpenter Technology 5/02 Groundwater $150,000 settlement;<br />
Open space/aquifer recharge<br />
acquisition<br />
D’Imperio Property<br />
Superfund Site<br />
10/02 Groundwater $100,000 settlement;<br />
Open space/aquifer recharge<br />
acquisition<br />
Shulton Landfill 7/16/01 Groundwater $78,000 settlement; Purchase of<br />
open space for aquifer recharge<br />
Mystic Associates 2/02 Groundwater $60,000 settlement;<br />
Open space/aquifer recharge<br />
acquisition<br />
Jersey Tyler Foundry<br />
Site<br />
4/02 Stream<br />
sediment<br />
$50,000 settlement;<br />
Stream habitat restoration<br />
A to Z Automotive 9/6/00 Groundwater $14,750 settlement<br />
Hope Auto Care 4/02 Groundwater $10,000 settlement;<br />
Open space acquisition<br />
Lang Superfund Site 4/19/01 Groundwater $7,500 settlement;<br />
Restoration<br />
DC1 1763595v.1<br />
20<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 21<br />
Site<br />
Helen Kramer<br />
Superfund Site<br />
Lone Pine Landfill<br />
Superfund Site<br />
Spence & Pijack Farms<br />
Superfund Site<br />
Settlement Injury<br />
Date<br />
4/98 Groundwater<br />
Wetlands<br />
Settlement<br />
Acquisition of 151 acre recharge<br />
area/wetland implemented by<br />
responsible parties<br />
6/12/97 Wetlands 16 acre wetland creation<br />
(Freehold) implemented by<br />
responsible parties, acquired 70<br />
acres of wetlands<br />
8/28/95 Wetlands 5 acre restoration of wetlands<br />
implemented onsite during<br />
remediation<br />
Liberty National 9/14/01 Wetlands<br />
Sediments<br />
Hopkins Farm<br />
Superfund Site<br />
5 acres of wetland restoration and<br />
public access trails on the Caven<br />
Point Peninsula<br />
7/96 Wetlands Restoration of wetlands<br />
implemented during remediation<br />
Since 2003, New Jersey has settled approximately 750 <strong>NRD</strong> cases, collecting $35 million. 37<br />
Some notable examples include the following:<br />
Site/Spill Date Settlement<br />
210 Hudson & Essex Counties<br />
Chromium Sites (Honeywell<br />
International, PPG Industries,<br />
11/12/03 Honeywell: $8,639,371<br />
PPG Industries: $6,725,712<br />
Tierra Solutions: $1,634,916<br />
Tierra Solutions)<br />
International Matex Tank<br />
Terminals (IMTT)<br />
4/29/05 $3 million to fund recreation and water<br />
quality improvement projects<br />
Merck & Co. 1/12/06 $2.38 million payment;<br />
Donation of 10 acres of wetlands;<br />
Fund a $30,000 restoration project<br />
Motiva Enterprises/Shell Oil<br />
Co., terminal facilities and ><br />
400 service stations statewide<br />
Chevron 2006 oil spill (10,000<br />
gallons of crude oil) from Perth<br />
Amboy facility into Arthur Kill<br />
1/12/06 $2.2 million settlement;<br />
Conservation easement on 51 acres of land at<br />
the mouth of the Woodbridge River<br />
4/25/07 $1 million settlement to be used by NY/NJ<br />
Baykeeper to reestablish oyster beds in New<br />
York/New Jersey Harbor (Arthur Kill and<br />
Raritan Bay);<br />
Previous payment of $45,000 to NJDEP<br />
37 Brian T. Murray, Extension of Pollution Law Urged, The Star-Ledger (5/9/07), available at<br />
http://www.nj.com/printer/printer.ssf?/base/news-7/1178689830249090.xml&coll=1.<br />
DC1 1763595v.1<br />
21<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 22<br />
Site/Spill Date Settlement<br />
El Paso Corp., 37 sites 6/28/05 $260,000 for wetlands restoration;<br />
Acquisition of 263 acres for aquifer recharge<br />
protection, wildlife management area,<br />
endangered species habitat, outdoor<br />
recreation<br />
Thomas & Betts Corp., 4 sites 4/17/06 $200,000 payment toward future state<br />
restoration projects<br />
Metuchen Site<br />
Fairfield Site<br />
Rexon Site<br />
Mark IV Industries, Inc.<br />
Tabernacle Site (US Steel<br />
Corp. and ACR, Inc. of South<br />
Jersey)<br />
$162,758.50 for injuries;<br />
$2,597 in assessment costs<br />
5/21/07 $150,000 for acquisition of 231 acres in<br />
Rancocas Watershed Acquisition;<br />
$25,000 assessment costs<br />
Curtiss-Wright Corp. 3/23/05 $100,000 initial payment;<br />
groundwater remediation<br />
SP Industries’ Peach Tree<br />
Street Facility, Vineland<br />
5/26/05 $65,641 to be used toward a restoration<br />
project<br />
SP Industries’ Wilmad Glass 1/05 $56,586 settlement<br />
Site, Buena Vista<br />
American Standard/Trane<br />
Properties<br />
5/21/2007 $10,000 payment;<br />
Restoration project involving construction of<br />
a 2-acre wetland basin area on site;<br />
Construction of a conveyance for rainwater<br />
from approximately 12 acres of impervious<br />
surfaces on plant property into the wetland<br />
basin.<br />
Bridgeland Warehouses 5/2/2007 $10,000 payment<br />
Property<br />
Cooper Industries/Former<br />
McGraw Edison Property<br />
5/21/2007 $8,148 payment for restoration;<br />
$2,900 in assessment costs<br />
Valero Refining Co., 4 sites 1/5/06 Fund the acquisition of 4 parcels totaling 615<br />
acres;<br />
Assessment costs<br />
Chevron 12/5/05 Donation of 200-acre parcel (Hackettstown);<br />
Fund the acquisition of 165-acre parcel;<br />
Restoration and deed restriction of 11 acres<br />
of salt marsh;<br />
Assessment costs<br />
7-Eleven Site 4/17/06 Donation of 82 acres of predominantly<br />
forested wetlands to protect water quality and<br />
wildlife habitat, construct public parking<br />
area, easement, preserve as open space for<br />
recreational activities<br />
DC1 1763595v.1<br />
22<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Angus Macbeth of Sidley Austin LLP Speaker 24b: 23<br />
Site/Spill Date Settlement<br />
ConocoPhillips 12/5/05 Fund the acquisition of 73 acres<br />
Hatco Site 4/21/05 Land acquisition project: 34-acre parcel with<br />
wetland and upland habitat, land trust<br />
CONCLUSION<br />
The stakes are high in natural resource damage litigation and many of the cases brought by the<br />
Trustees have been, and are likely to continue to be, litigated in the courts. PRPs see that the<br />
government faces difficulties in demonstrating actual injury to natural resources and in proving<br />
causation and other elements of their claims.<br />
PRPs should develop a strategy early on for responding to a natural resource damage claim. The<br />
first step is to make a preliminary assessment of the strength of the Trustees’ case. If a viable<br />
claim appears to exist, PRPs may want to consider conducting the assessment themselves, but<br />
only on acceptable terms which allow the PRPs to co-manage the assessment process. PRPs may<br />
want to explore the use of such tools as cooperative assessments, Joint Assessment Teams, and<br />
integrated natural resource assessments and response actions.<br />
Once assessment is complete and the nature and scope of damages has been determined,<br />
settlement negotiations may be aided by the use of a neutral, particularly when federal trustees<br />
are involved. In considering settlement options, PRPs may be well-served by thinking outside the<br />
box. Increasingly, in-kind restoration, property transfers or conservation easements, restoration<br />
credits trading, and the use of innovative funding mechanisms are replacing simple monetary<br />
settlements for natural resource damages.<br />
DC1 1763595v.1<br />
23<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
L A W S E M I N A R S I N T E R N A T I O N A L<br />
The Fourth Annual Advanced Conference on<br />
Natural Resource Damages<br />
New developments and best strategies<br />
July 15 and 16, <strong>2010</strong><br />
<strong>Santa</strong> <strong>Fe</strong>, NM<br />
Estimation of Restoration and Compensable<br />
Value Damages<br />
Robert E. Unsworth<br />
Industrial Economics, Incorporated<br />
Cambridge, MA<br />
Rick Dunford, Ph.D.<br />
Environmental Economics Services, LLC<br />
Raleigh, NC<br />
William H. Desvousges, Ph.D.<br />
W. H. Desvousges & Associates<br />
Raleigh, NC<br />
Donald W. Fowler, Esq.<br />
Hollingsworth LLP<br />
Washington, DC
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 2<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 3<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 4<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 5<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 7<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Robert E. Unsworth of Industrial Economics, Incorporated Speaker 25: 8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 1<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 2<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 3<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 4<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 5<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 6<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Rick Dunford of Environmental Economics Services, LLC Speaker 26: 7<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 1<br />
Assessing Groundwater Damages:<br />
A Case Study<br />
Prepared by:<br />
William H. Desvousges, Ph.D.<br />
President<br />
W.H. Desvousges &<br />
Associates, Inc.<br />
June 24, <strong>2010</strong><br />
P.O. Box 99203<br />
Raleigh, NC 27624<br />
Phone: 919-847-7101<br />
Fax: 919-847-7445<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 2<br />
INTRODUCTION<br />
In this case study of a natural resource damage assessment (<strong>NRD</strong>A), the<br />
Plaintiff sued the owner of a former chemical facility for natural resource damages<br />
resulting from groundwater contamination at the site. The Plaintiff’s expert used<br />
Resource Equivalency Analysis (REA) to estimate losses at the site based on the size<br />
of the injured plume over time and the amount of land that would have to be obtained to<br />
provide the equivalent amount of water over time. This approach focuses exclusively<br />
on the quantity of affected water, rather than on the service losses that may have<br />
resulted from the injury. Both standard economic valuation principles and the principles<br />
incorporated into the Department of Interior 43 CFR Part 11 regulations recognize that<br />
the services a resource would have provided between the time of the injury and return<br />
to baseline are the appropriate metric on which to base any potential compensation.<br />
This compensation can be made either through the dollar valuation of the lost services<br />
or through a restoration project that provides services of the same type and quality as<br />
those that were lost. In this case, the Plaintiff’s expert ignores service losses and<br />
calculates the cost of completely replacing the resource. In a case with no evidence of<br />
any service losses, the Plaintiff’s expert produces an assessment of several million<br />
dollars damages with no basis in regulations or economic theory. This paper provides<br />
an overview of that case study and the economic issues associated with it.<br />
SITE DESCRIPTION<br />
This case involves the site of a former chemical facility that covers<br />
approximately 11.2 acres and is located in a light industrial/commercial park in New<br />
Jersey. From approximately 1976 to 1984, the facility operated as an adhesives<br />
backed product preparation facility. Soil studies have found detectable concentrations<br />
of chlorinated solvents at the site. In addition, groundwater samples show that the<br />
groundwater on the site of the former facility, and areas downgradient of the site, has<br />
been contaminated with chlorinated and non-chlorinated organic compounds.<br />
Significant remedial work has already been accomplished at the site and further work is<br />
planned as part of fulfilling the site remediation requirements.<br />
1<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 3<br />
PLAINTIFF’S APPROACH<br />
The Plaintiff’s expert does an assessment of groundwater damages using REA.<br />
REA is equivalent to Habitat Equivalency Analysis (HEA) in that it is used as a tool to<br />
scale compensatory restoration using a services-to-services approach. The difference<br />
being that HEA uses a habitat metric, such as acres of land, and applies a change in<br />
services to that habitat such as a percent reduction in services as a result of an injury.<br />
REA typically uses a resource metric that has had a population or quantity change<br />
rather than a quality change as a metric. For example, an injury to a stream may have<br />
caused a reduction in the fish population. The number of fish in the stream reflects the<br />
reduction in services in the stream that resulted from a reduction in the quality of the<br />
habitat. Improvements in habitat at the site or elsewhere may increase the populations<br />
of fish and provide compensatory restoration. The number of fish produced through<br />
compensatory restoration is scaled with the number of fish lost as a result of the injury.<br />
The basis for the analysis in REA is balancing the lost services with compensatory<br />
services over time to make the public whole for the injury.<br />
However, the Plaintiff’s expert does not use REA in the usual manner. In the<br />
Plaintiff’s expert’s analysis, REA is used to equate gallons of injured groundwater to<br />
gallons of water found in preserved land. The expert does not assess the effect of the<br />
injury on groundwater services, the first step in any damage assessment. Instead, he<br />
measures the total volume of groundwater and assumes a 100 percent service loss.<br />
He then uses REA to estimate the amount of land that would contain an equivalent<br />
amount of groundwater that could be purchased for compensation. He used the<br />
average cost of acquiring land in the area multiplied by the number of acres that results<br />
from his calculations as the basis for damages. Figure 1 shows how the Plaintiff’s<br />
expert’s assessment differs from the steps used in a proper assessment.<br />
2<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 4<br />
Proper REA or HEA Assessment<br />
Figure 1<br />
Plaintiff’s REA Assessment<br />
Groundwater provides a number of potential services directly to the public and<br />
indirectly through the environment (Figure 2). At the site of this case study,<br />
groundwater is contained within the aquifer and does not reach the surface to affect<br />
surface water and surface water habitats. Therefore, the groundwater only provides<br />
services within the aquifer. Habitat services relate to the maintenance of the integrity of<br />
the aquifer, such as preventing land subsidence, and in some cases salt water<br />
intrusion. The direct human-use service potentially provided by groundwater within an<br />
aquifer is extractive use of the water for drinking, irrigation, or industrial processes. In<br />
most cases, an isolated plume of groundwater will not affect the aquifer as a whole;<br />
thus it will not impact the availability of water to the community. In particular, the<br />
requirement of primary restoration of the injured groundwater assures that there will not<br />
be any future effects on groundwater availability.<br />
3<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 5<br />
Figure 2: Groundwater Services<br />
FLAWS IN APPROACH<br />
below.<br />
There are several flaws with the Plaintiff’s approach. These are discussed<br />
Natural Resource Services<br />
The Plaintiff’s approach ignores the concept of natural resource services. It<br />
does not describe any actions to investigate whether groundwater services were<br />
affected by the release at the former facility. For example, the Plaintiff’s expert did not<br />
investigate the local water supply to see if the injury could have affected the quantity or<br />
quality of the public water supply. When we contacted the Director of Utilities of the<br />
township, we learned that it is impractical to place drinking water wells in the vicinity of<br />
this facility because of the high naturally occurring iron concentrations (Merk 2009).<br />
Because of the high iron concentrations in the vicinity of the former facility among other<br />
reasons, the township has no plans to drill additional wells in the area. Moreover, the<br />
township has a thirty-year contract to purchase the balance of its water needs from a<br />
regional water supplier, which obtains its water supply from outside of the county.<br />
Furthermore, the Director of Utilities indicated there is no evidence that drinking water<br />
supplies were ever, or will be, impacted by the releases at the former facility.<br />
4<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 6<br />
Furthermore, the Plaintiff’s experts do not demonstrate that any ecological or in<br />
situ services have been affected by the releases at the former facility. (And no<br />
evidence was presented at trial that they were impacted.) Contamination does not<br />
affect the ability to prevent subsidence or salt water intrusion in the aquifer. Because<br />
the groundwater does not reach the surface, there is no loss in habitat services.<br />
However the Plaintiff’s expert does not address any of these potential services and<br />
instead assumes a 100% service loss.<br />
Timeframe of Injury<br />
The Plaintiff’s expert did not provide any evidence that there is a basis for<br />
natural resource damages by demonstrating that any natural resource services had<br />
been lost to the public. However, he moves along assuming 100% service loss for all<br />
of the injured resource. He then has to estimate a timeframe for the injury. The first<br />
groundwater sampling occurred in 1985. Rather than use 1985 as the start date for his<br />
assessment, he assumes that the groundwater plume start date corresponds with the<br />
start of operation of the plant: 1977. Because losses that occur in the past weigh<br />
heavily on the total damage estimate, adding eight years to the assessment has a<br />
substantial impact on the total loss estimate. The Plaintiff’s expert provides little<br />
support for extending the time period of injury to the start of operation.<br />
Resource Equivalency Analysis (REA)<br />
Because of the failure to consider services in their analysis, the Plaintiff’s use of<br />
the REA is fatally flawed as well. A proper REA would quantify the reduction in natural<br />
resource services lost as the result of a release and then would determine whether<br />
specific compensatory restoration projects would provide equivalent discounted service<br />
flows (NOAA 2006). Because they have not determined and measured any service<br />
reductions for the releases at the former facility site, the Plaintiff’s cannot conduct a<br />
properly scaled REA, nor evaluate alternative projects to find the one that is most costeffective.<br />
Moreover, the use of REA for this site is unorthodox because it is usually<br />
applied to situations where there are losses in biological injuries and related service<br />
losses (Zafonte and Hampton 2007). REA is not suitable for groundwater cases<br />
because of the disparity in the type of services provided by groundwater relative to<br />
habitat alternatives.<br />
5<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 7<br />
Compensatory Restoration<br />
The Plaintiff’s propose replacement of the resource as compensatory<br />
restoration for the alleged groundwater losses at the former facility site. However,<br />
replacement of a resource is only appropriate when all of the natural resource services<br />
have been permanently lost (Dunford, Ginn, and Desvousges 2004). In the case of this<br />
groundwater release, neither of these criteria has been met. There is no evidence that<br />
any services have been lost as a result of the release and the release will be mitigated<br />
through the remedial process. Replacement of the resource would be a gross<br />
overcompensation for the injury and completely unnecessary to compensate for any<br />
lost groundwater services.<br />
In addition, the development of compensatory restoration alternatives must<br />
account for cost. The least cost restoration alternative that fully compensates for lost<br />
services provides the maximum benefit. Rarely does full replacement of a resource<br />
provide compensatory services for the least cost. Only if compensatory services<br />
cannot be provided using lower cost restoration alternatives would replacement of the<br />
resource be considered. Using a least-cost approach is fundamental to the concept of<br />
providing economic benefits to the public (Bockstael, et al. 2000; USEPA 2009).<br />
Moreover, land replacement grossly overcompensates for the services that<br />
allegedly were lost as a result of the releases. Purchasing and preserving land in an<br />
attempt to protect groundwater services also protects a multitude of other services that<br />
provide direct benefits to the public. Open space provides many habitat services and<br />
potentially direct and indirect recreational services to the public; there is no allegation or<br />
evidence of lost habitat services here. Moreover, protecting open space provides<br />
habitat services for wildlife and potential recreational services for people (e.g.,<br />
birdwatching and wildlife viewing) that far surpass any groundwater service losses that<br />
could have occurred as a result of the releases.<br />
Crucial in the scaling of compensatory restoration are the assumptions based<br />
on the quality and quantity of services that will be provided by the restoration project.<br />
The Plaintiffs do not provide any analysis of the individual potential locations used to<br />
assess the cost of land acquisition. There is no support for the assumption that the<br />
6<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 8<br />
services provided by these parcels of land are representative of the type of services<br />
lost at the former facility site.<br />
Costs<br />
Furthermore, their compensation approach is flawed. Natural resource<br />
damages calculations are not typically based on the cost of land, particularly without<br />
identifying a specific piece of property. The Plaintiffs make no proposal for a specific<br />
restoration project, much less one that shows evidence that the services provided by<br />
the compensatory restoration project would be of the same type and quality as those<br />
that were lost at the injured site.<br />
In addition, the Plaintiff’s expert does not consider cost effectiveness in his<br />
assessment. He uses an average cost of purchasing land. Instead, he should choose<br />
the most cost effective alternative for providing compensation. If two pieces of land<br />
provide the same groundwater recharge benefits, it would be most efficient to purchase<br />
the least cost alternative. Why would a piece of land with a water view be purchased<br />
for compensation, if it provides the same groundwater protection as a piece of land with<br />
a view of the town landfill? Using an average cost overestimates the cost of providing<br />
compensation.<br />
SUMMARY<br />
This case provides and example of an injured site that does not result in any<br />
natural resource damages because there have been no lost services. 1 The loss in<br />
natural resource services to the public is the basis for quantifying potential natural<br />
resource damages. The damages provide compensation to the public for loss of these<br />
services during the period of injury. This compensation is not in lieu of primary<br />
restoration of the site but instead makes the public whole for any losses that may have<br />
occurred as a result of injury. Without service losses, there is no basis for assessing<br />
damages. In this case, the Plaintiff’s expert uses injury as the basis for his<br />
assessment. He makes no attempt to identify any services that may have been<br />
affected by the injury and instead assumes a 100 percent loss for the resource. This<br />
1 Under cross examination at trial, the Plaintiff’s expert agreed that if there is no loss in services,<br />
there are no damages.<br />
7<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
William H. Desvousges of W. H. Desvousges & Associates Speaker 27: 9<br />
assessment has no basis in the federal damage assessment regulations or in economic<br />
principles.<br />
REFERENCES<br />
Bockstael, Nancy E., A Myrick Freeman, III, Raymond J. Kopp, Paul R. Portney, and V.<br />
Kerry Smith. 2000. “On Measuring Economic Values for Nature.” Environmental<br />
Science & Technology 34(8):1384-1389.<br />
Dunford, R.W., T.C. Ginn, and W.H. Desvousges. 2004. "The use of habitat<br />
equivalency analysis in natural resource damage assessments." Ecological<br />
Economics. 48: 49 – 70.<br />
Merk, Larry. 2009. “Affidavit of Larry Merk in the Matter of New Jersey Department of<br />
Environmental Protection, The Commissioner of The New Jersey Department of<br />
Environmental Protection and The Administrator of The New Jersey Spill<br />
Compensation Fund, v. Essex Chemical Corporation.” Superior Court of New<br />
Jersey Law Division - Middlesex County Docket No: MID-L-5685-07.<br />
National Oceanic and Atmospheric Administration. 2006. “Habitat Equivalency<br />
Analysis: An Overview.” Damage Assessment and Restoration Program. March<br />
21, 1995 (Revised October 4, 2000 and May 23, 2006).<br />
http://www.darrp.noaa.gov/library/pdf/heaoverv.pdf<br />
U.S. Environmental Protection Agency Science Advisory Board. 2009. “Valuing the<br />
Protection Ecological Systems and Services.” Report Number EPA-SAB-09-<br />
012. May. www.epa.gov/sab.<br />
Zafonte, M. and S. Hampton. 2007. “Exploring the welfare implications of resource<br />
equivalency analysis in natural resource damage assessments.” Ecological<br />
Economics. 61: 134 – 145.<br />
8<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Donald W. Fowler of Hollingsworth LLP Speaker 28: 1<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Donald W. Fowler of Hollingsworth LLP Speaker 28: 2<br />
R~ N o t e s ~<br />
Law Seminars International | Natural Resource Damages | 07/16/10 in <strong>Santa</strong> <strong>Fe</strong>, NM
Change language