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LOUGHLIN v. U.S.

November 19, 2002

THOMAS P. LOUGHLIN, ET AL., PLAINTIFFS,
V.
UNITED STATES OF AMERICA, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Ellen Segal Huvelle, United States District Judge

  MEMORANDUM OPINION

The Loughlins have brought suit against the United States ("government"), American University ("American" or "AU"), and Glenbrook Limited Partnership, Lawrence N. Brandt, Inc., Lawrence N. Brandt, and Robert Brandt [hereinafter referred to collectively as "Glenbrook-Brandt"] because of the presence of munitions, highly toxic chemicals, and chemical warfare agents on their residence at 4825 Glenbrook Road.*fn1 Glenbrook-Brandt has filed cross-claims for negligence against the United States seeking compensation for property damage and indemnification for any sums Glenbrook-Brandt may have to pay plaintiffs.*fn2 This Memorandum Opinion addresses only the claims and cross-claims against the government and the Loughlins' claims against Glenbrook-Brandt. The United States has moved to dismiss the Loughlins' claims for lack of subject matter jurisdiction under the Federal Tort Claims Act ("FTCA"), and for summary judgment based on the Loughlins' assumption of the risk. The United States has also moved to dismiss the Glenbrook-Brandt cross-claims for lack of subject matter jurisdiction under the FTCA. With respect to the FTCA actions, defendant United States asserts that this Court lacks subject matter jurisdiction because: (1) the claims are barred by the statute of limitations provisions of the FTCA, see 28 U.S.C. § 1346(b), 2401(b), 2675; (2) there is no analogous private liability sufficient to establish government liability for the alleged negligence, see 28 U.S.C. § 2674; and (3) the claims are barred by the discretionary function exception to the FTCA, see 28 U.S.C. § 2680(a).*fn3 Glenbrook-Brandt has moved for summary judgment with respect to the Loughlins' failure to warn claim, arguing that plaintiffs are barred from bringing suit because Glenbrook-Brandt made full disclosure.*fn4 Although the Court reserves judgment on the discretionary function argument until the issue is fully briefed and argued by all parties (see supra note 3), it concludes that the other arguments of the government must be rejected, and that Glenbrook-Brandt's motion for summary judgment should be denied.

BACKGROUND

In April 1917, in order to support the war effort against Germany, AU offered the United States the use of its 92-acre campus in what is now known as the Spring Valley neighborhood of Northwest, Washington, D.C. The government accepted AU's offer and established the American University Experiment Station (AUES) on the property. The AUES was the site of a massive training, research and testing ground for conventional and chemical warfare techniques. (Loughlin Compl. ["Compl."] ¶ 15.) The Army conducted projects and field tests related to the development, testing and manufacture of gases, toxic and incendiary munitions, smoke mixtures, and signal flares. These activities were conducted using gas shells, smoke clouds, mortars and projectiles, hand grenades and flaming liquid weapons. (Id. ¶ 15.)

In approximately 1920, AU voted to release the government from its obligation to clear and restore the property before it was returned to AU. In exchange, the government was to build eight buildings for AU. (Id. ¶ 18.) (See Memorandum of Agreement between U.S. and American University, Memorandum in Support of Defendant United States' Motion to Dismiss Plaintiff's Complaint, or In The Alternative, for Summary Judgment ["U.S. Def.'s Mem."] Ex. 5.)*fn5

In addition to using AU for military efforts, the United States Department of Agriculture ("USDA") operated a laboratory on the campus from 1919 to 1945 to develop pesticides and herbicides. (January 13, 1994 Memorandum from Lawrence Richardson to Karen Solari, Memorandum in Support of Glenbrook-Brandt Defendants' Motion for Summary Judgment ["Glenbrook-Brandt Defs.' Mem."] Ex. 3.)

Prompted by the discovery of a 1921 article in The American University Courier indicating that the Army had buried munitions on or near the campus during World War I and by the University's plan to construct a new athletic complex, AU initiated in 1986 an extensive literature search and conducted personal interviews in an effort to obtain information substantiating or refuting the report of buried munitions on AU property. No such information was uncovered. (Defendant American University's Response to The United States of America's Motion to Dismiss, or In The Alternative, for Summary Judgment ["AU Def.'s Resp."] Ex. 4.) AU also contacted the Army Corps of Engineers ("Corps") to inquire about the reports and for assistance as it began construction of the new athletic facility. (U.S. Def.'s Mem. Ex. 7.) In response, the Corps conducted a document search at the U.S. Army Military History Institute and concluded:

There is no official evidence of any such burial at AU. Official correspondence from the period strongly suggests that all munitions were removed to Edgewood Arsenal. . . . If any materials were buried, they would probably have been small quantities of laboratory or experimental materials. All sources we found were inconsistent with the notion of substantial quantities of any munitions or the components for munitions existing at AU.

(AU Def.'s Resp. Ex. 10.) The Corps' report questioned the credibility and accuracy of the Courier articles, but also noted "[w]e could not disprove the burial of some materials on or near Camp American University." (Id.) As part of this investigation, AU and representatives of the Army reviewed a 1918 aerial photograph of the AUES that clearly indicated the presence of a substantial bomb pit directly on or near the 4825 Property. (Compl. ¶ 24.) However, the Corps' onsight survey of the construction site did not produce evidence of any suspicious items. (AU Def.'s Resp. Ex. 8.) Nonetheless, the Corps remained on site to supervise the excavation and caisson drilling phase of the construction. (Id.)

Plaintiffs assert in their complaint that in 1986, the Environmental Protection Agency ("EPA") also conducted a study for the Corps and concluded that the 4825 Property contained a probable burial ground for dangerous munitions and highly toxic materials. (Compl. ¶ 23.) This allegation is disputed by the government. (Defendant United States of America's Statement of Material Facts to Which There is No Genuine Dispute ["U.S. Def.'s Stat."] ¶ 18.)

In 1990, Glenbrook-Brandt purchased from AU a parcel of land adjoining the AU campus and it began construction of two residential homes two years later. Construction was halted twice in May 1992 after Glenbrook-Brandt's workers were overcome by strong odors and suffered eye and lung pains requiring emergency hospital care. (Compl. ¶ 31.) The construction also uncovered old laboratory equipment, possible chemical contaminants, broken jars, and a 55-gallon drum. (Id.) Glenbrook-Brandt notified AU of these developments and requested that AU investigate. AU retained Environmental Management Systems ("EMS"), an industrial hygiene consulting firm, to investigate the incident. (U.S. Def.'s Stat. ¶¶ 23-24.) The EMS investigation began on May 8, 1992. (Id. ¶ 24.)

The first tests performed by EMS analyzed soil for pesticides and metals. (February 18, 1999 Letter, U.S. Def.'s Mem. Ex 8.) From these tests, "EMS concluded that there were no hazardous, volatile or controlled substances at the site." (Id.) EMS's results, forwarded to Brandt by AU, found that "[soil] samples are well within the EPA's criteria for acceptable levels for the materials noted. The dirt is acceptable for dumping to any area and will not present a health or environmental hazard." (May 20, 1992 Letter, Glenbrook-Brandt Defs.' Mem. Ex. 5.) The second set of tests performed by EMS identified the presence of the herbicide Silvex in the soil. EMS's report on these tests explained that Silvex is very irritating to the eyes and senses, but is not a hazardous substance. Specifically, EMS concluded that "[a]ccording to the EPA, silvex (sic) contaminated soil should not be disposed of near waterways, streams, wetlands or where crops are to be planted . . . . due to the acidic nature of the substance . . . . [which] could be toxic to fish. However, the substance does not have a pollution potential to the food chain." (June 4, 1992 Letter, U.S. Def's. Mem. Ex. 10.) Later that summer Glenbrook-Brandt removed four loads of the Silvex-contaminated soil from the 4825 property and proceeded with construction. (Compl. ¶ 35; February 8, 1999 Letter, U.S. Def.'s Mem. Ex. 8.)

In January 1993, the Corps initiated a remedial investigation for buried ordnance and contamination in Spring Valley which was referred to as Operation Safe Removal Formerly Used Defense Site ("OSR FUDS"). (U.S. Def.'s Mem. to Dismiss Cross-Cl. ¶ 28.) The investigation was triggered by the discovery of a munitions bunker approximately one mile away from the 4825 property.*fn6

In January 1994, the Corps contacted Glenbrook-Brandt to request access to the properties at 4825 and 4835 Glenbrook to sample the soil. The request letter stated, "the soil in your area is not known to pose any danger to the residents. Soil sampling is to be conducted solely to provide an added assurance to the community and to assist us in completing a thorough investigation of Spring Valley." (January 12, 1994 Letter, Glenbrook-Brandt Defs.' Mem. Ex. 7.) Glenbrook-Brandt consented. (January 26, 1994 Consent of Property Owner, Glenbrook-Brandt Defs.' Mem. Ex. 8.)*fn7

In February 1994 the Loughlins tendered a purchase offer to Glenbrook-Brandt to buy the property at 4825 Glenbrook. After executing the sales contract, Lawrence Brandt informed the Loughlins that during construction the workers had unearthed a white crystaline substance together with broken glassware and one or more empty fifty-five gallon drums on the 4825 property. Mr. Brandt informed the Loughlins that AU had told him that the property had once been the site of a "landscaping shed" at which landscaping chemicals and equipment had been stored. Robert Brandt also informed the Loughlins of EMS's findings. (Plaintiffs' Opposition to Defendant United States of America's Motion to Dismiss, or in the Alternative, for Summary Judgment ["Pls.' Opp. to U.S. Def.'s Mot."] Exh B, T. Loughlin Aff. [hereinafter "Loughlin Aff."] ¶¶ 5, 8-9.) However the Loughlins deny that they were informed that significant potential hazards had been identified on the 4825 property by the EPA or that highly toxic chemical warfare materials had been unearthed during the construction of the residence. (Id. ¶¶ 13-14.)

As a result of Glenbrook-Brandt's disclosures, the Loughlins hired an independent testing organization, ECS, to sample the soil and conduct an evaluation of potential environmental hazards on the 4825 property. (Id. ¶ 10.) Glenbrook-Brandt agreed to assume the costs of theses tests. (March 7, 1994 Letter, Glenbrook-Brandt Defs.' Mem. Ex. 11.) ECS conducted its independent investigation of the 4825 property on behalf of the Loughlins on March 10-11, 1994. ECS analyzed four soil samples for eight metals, including arsenic, and numerous pesticides, herbicides, and volatile and semi-volatile substances. The ECS report stated that "[t]he general vicinity of this residential lot was apparently used in munitions testing in the early part of this century. . . . Therefore, there is some concern that some contamination may exist around this residence." (March 17, 1994 Letter, Glenbrook-Brandt Defs.' Mem. Ex. 13.) However, it concluded that "no hazardous compounds were found . . ." and that "the residential lot at 4825 Glenbrook Road has not been impacted by contamination from hazardous materials." (Id.)

On March 21, 1994, the Loughlins contracted to purchase the 4825 property. Prior to closing, the Loughlins and Glenbrook-Brandt entered into an agreement whereby Glenbrook-Brandt indemnified the Loughlins in the event that government studies revealed hazardous materials on the property. As explained by plaintiffs, they requested that there be an Indemnification Agreement because it was expected that the government would conduct further soil sampling at 4825 Glenbrook, but the results would not be known prior to settlement. (Loughlin Aff. ¶ 12.) The Indemnification Agreement stated in pertinent part:

[A]fter execution of the Initial Sales Contract, the Seller disclosed to the Loughlins that certain materials had been found upon excavation of the property, which may have contained Hazardous Substances as such term is defined herein . . .*fn8
[U]pon discovery of the Material, the Sellers contacted the previous owner of the lot . . . and learned, for the first time, that the Material may be related to past operations of agencies of the United States Government . . .
[A]fter having been contacted of this discovery, the previous owner of the lot on which the Property is located retained a consultant to analyze soil samples collected on the lot and represented to the Sellers that said consultant detected the presence of Silvex, a propionic acid formerly used as a herbicide, at levels which would not present a health or environmental hazard . . .
[A]gencies of the Government are collecting and analyzing soil samples from the Property to determine whether any Material may pose a risk to human health or the environment . . .

(U.S. Def.'s Mem. Ex. 18.)

The Corps and EPA also conducted soil sampling at the 4825 property that same month. (Glenbrook-Brandt Defs.' Mem. at 7.) According to the government, the soil sample was analyzed for chemical warfare agents but the results failed to show detectable levels of these substances or breakdown products. (U.S. Def.'s Stat. ¶ 37.) EPA collected seven soil samples on March 11, 1994, one of which showed an elevated level of arsenic. (U.S. Def.'s Stat. ¶ 39.) The Loughlins claim not to have learned of these tests until they were disclosed by the Corps in early February 1999. (Loughlin Aff. ¶¶ 35-37.) Glenbrook-Brandt also denies receipt of these test results. (Glenbrook-Brandt's Opposition to United States' Motion to Dismiss the Cross-Claim of Glenbrook Limited Partnership, Lawrence N. Brandt, Inc., Lawrence N. Brandt, and Robert Brandt ["Glenbrook-Brandt Defs.' Opp."] at 9.)

In January 1995, the Corps issued a letter to the Loughlins and their neighbors indicating that the analysis of soil samples taken from their neighborhood "did not detect the presence of chemical agents [or] explosives" and that "no hazard to human health or to the environment exists as a result of DoD activities in the area." (Pl.'s Opp. to U.S. Def.'s Mot. Ex. H.) Subsequently, the Corps confirmed this finding in a Record of Decision ("ROD") and concluded that no further action was required with respect to the Spring Valley property, including 4825 Glenbrook Road. (June 2, 1995 U.S. Army Corps of Engineers Record of Decision, Glenbrook-Brandt Defs.' Mem. Ex. 16.). Upon issuance of the ROD, OSR FUDS was complete.

In June 1996, workers planting a tree on the grounds of the AU President's house at 4835 Glenbrook, adjacent to the 4825 property, were overcome by odors and fumes that burned their eyes. The workers unearthed laboratory glassware and broken bottles filled with chemicals. AU called in Apex Environmental, Inc., environmental specialists, to investigate. (Compl. ¶ 41; U.S. Def.'s Mem to Dismiss Cross-Cl. ¶ 58.) The Apex investigation uncovered "numerous laboratory bottles and broken glass pieces . . . in the bottom and sides of the excavated area . . . [and] a layer of buried glassware in the soil at a depth of approximately two feet below the surface." (U.S. Def.'s Mem. Ex. 22 at 5.) Apex's final report, dated August 6, 1996, concluded that "[i]nitial soil samples revealed elevated levels of certain metals and volatile organic compounds, with arsenic being of most concern."*fn9 (Id. at 48.) An investigation by the District of Columbia also revealed elevated concentrations of arsenic and other substances. (U.S. Def.'s Mem. to Dismiss Cross-Cl. at 17, ¶ 57.)

In February 1998, the Corps conducted a geophysical survey of the Korean Ambassador's residence at 4801 Glenbrook, which also abuts the 4825 property. (Compl. ¶ 45.) The survey "indicated the presence of two suspect disposal pits which would require an intrusive investigation." (Id.) In April and June 1998, the Corps sent letters to Spring Valley residents notifying them of the need for additional investigation. (U.S. Def.'s Mem. Exs. 35 and 36.) The April letter stated that the Corps, in coordination with the EPA and the District of Columbia government, would "investigate whether additional chemical warfare materials, breakdown products and potential laboratory contaminants such as containers of mustard gas, exist at this single site." (U.S. Def.'s Mem. Ex. 35.) Further investigation of the 4801 property did not begin until February 15, 1999. (Compl. ¶ 45.) At that time, a 75 mm projectile was discovered buried only six inches deep in the backyard of the Ambassador's residence. (Compl. ¶ 46.)

The Corps contacted the Loughlins again in December 1998 expressing an interest in further investigating their property "to confirm the absence of buried munitions, remnants thereof, and associated material." (U.S. Def.'s Stat. ¶ 70; U.S. Def.'s Mem. Ex. 26.) Later that month, Corps representatives met with the Loughlins at their home to obtain permission to conduct further testing and to answer their questions. (U.S. Def.'s Stat. ¶ 71; U.S. Def.'s Mem. Ex. 27 at 1.)

The Corps, on behalf of EPA Region III, conducted further soil sampling on the 4825 property on June 9, 1999. (July 26, 1999 Interim Trip Report Spring Valley Operable Unit 3 Washington, D.C., Glenbrook-Brandt Defs.' Mem. Ex 18.) A total of 22 soil samples were collected. (August 13, 1999 Interim Trip Report Appendix 2, Spring Valley Operable Unit 3 Washington, D.C., Glenbrook-Brandt Defs.' Mem. Ex. 19 at 1). All but four "contained arsenic above the EPA Region III Risk-Based Concentration (RBC) value of 0.43 mg/kg," the highest reading being 50.4 mg.kg. (Id. at 3.)

In April 2000, Major Brian D. Plaisted of the Corps met with lawyers representing Glenbrook-Brandt and the Loughlins and explained that there was a possibility that a burial pit, similar to the pits on the South Korean Ambassador's property, may be located on the 4825 property. (Glenbrook-Brandt Defs.' Opp. at 12.) Major Plaisted explained that certain munitions were in ceramic casings that could not have been detected by the previously-used investigatory techniques. He also indicated that there was no current evidence to suggest that arsenic existed at any great depth or that arsenic had been an issue at the property before April 1999. (Id. at 13.) The Corps' final evaluation and cost analysis for 4801 and 4825 Glenbrook Road reported the results of the June 9, 1999 sampling and concluded that there was an "unacceptable hazard from arsenic" on the property. (Id. (citing June 9, 2000 Draft Final of the Engineering Evaluation/Cost Analysis for 4801 and 4825 Glenbrook Road, Ex. 13).)

Plaintiffs Thomas and Kathi Loughlin resided at 4825 Glenbrook Road in Spring Valley from March 1994 to September 2000. Their children, plaintiffs Nora and Hannah Loughlin, were born during that time. In 1997 Kathi Loughlin was diagnosed with a brain tumor. (Compl. ¶ 44.) The Loughlins' invoked the terms of their Indemnification Agreement in a February 10, 1999 letter to Glenbrook-Brandt stating:

[t]he apparent presence of hazardous substances in the form of chemical weapons or components has caused the United States Government Investigators to seek access to our property for the purposes of investigation. We do not yet know the dimensions or consequences of this problem, but it appears that our property is becoming directly ...

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