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General Electric Co. v. Johnson

March 30, 2005

GENERAL ELECTRIC COMPANY PLAINTIFF,
v.
STEPHEN L. JOHNSON, ACTING ADMINISTRATOR, UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, AND THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY DEFENDANT.



The opinion of the court was delivered by: John D. Bates United States District Judge

MEMORANDUM OPINION

Plaintiff General Electric Company ("GE" or"plaintiff") has brought a broad constitutional challenge to section 106 of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA" or"the Act"), 42 U.S.C. § 9601 et seq. GE seeks a declaratory judgment that section 106, 42 U.S.C. § 9606, in tandem with sections 107(c)(3) and 113(h), 42 U.S.C. §§ 9607(c)(3), 9613(h), creates a regime that violates the Due Process Clause of the Fifth Amendment. Am. Compl. at ¶ 1. Presently before the Court is the motion for summary judgment of defendants the United States Environmental Protection Agency and its acting administrator, Stephen L. Johnson (collectively"EPA" or"defendant").*fn1

EPA < s="" motion="" for="" summary="" judgment="" contends="" that="" ge's="" constitutional="" challenge="" to="" cercla="" is="" a="" facial="" challenge="" limited="" to="" review="" of="" the="" text="" of="" cercla.="" according="" to="" epa,="" such="" a="" facial="" challenge="" to="" a="" statute="" is="" analyzed="" under="" the="" salerno="" doctrine,="" which="" dictates="" that="" a="" plaintiff="" must="" establish="" that="" a="" statute="" is="" unconstitutional="" in="" every="" application.="" see="" united="" states="" v.="" salerno,="">481 U.S. 739 (1987). EPA argues that, at the very least, CERCLA is constitutional in emergency situations, and therefore GE's facial constitutional challenge must fail.
GE counters that it has alleged not only a due process violation based on the text of CERCLA, but also that EPA's pattern and practice of administering section 106 of CERCLA creates a procedural due process violation. According to GE, its pattern and practice claim survives the jurisdictional bar of section 113(h) as interpreted in the D.C. Circuit < s="" prior="" decision="" in="" this="" case.="" see="" general="" elec.="" co.="" v.="" environmental="" protection="" agency,="">360 F.3d 188 (D.C. Cir. 2004). GE also urges the Court to permit discovery on both its claims prior to considering EPA's motion for summary judgment.

For the reasons discussed below, the Court will grant EPA's motion for summary judgment on GE's facial challenge to the text of CERCLA. The Court also concludes, however, that GE has alleged a"pattern and practice" constitutional claim, which is neither precluded by section 113(h) and the earlier decision of the D.C. Circuit nor the subject of EPA's motion. Therefore, GE may proceed with discovery on that claim.

BACKGROUND

I. The CERCLA Framework*fn2

CERCLA is"a comprehensive statute that grants the President broad power to command government agencies and private parties to clean up hazardous waste sites." Key Tronic Corp. v. United States, 511 U.S. 809, 814 (1994). CERCLA requires that sites contaminated by toxic wastes be abated and cleaned up expeditiously by, or at the expense of,"those responsible for the hazardous condition." Control Data Corp. v. S.C.S.C. Corp., 53 F.3d 930, 936 (8th Cir. 1995).

CERCLA contemplates two distinct kinds of clean-up actions arising under its statutory framework: removal actions and remedial actions. See 42 U.S.C. §§ 9601(23)-(24). Removal actions, which occur before remedial action is undertaken, are short-term actions taken to halt any immediate risks posed by hazardous wastes. Id. § 9601(23). Remedial actions are more permanent remedies taken to clean up contamination, and are"taken instead of or in addition to removal actions." Id. § 9601(24).

Section 122 of CERCLA authorizes EPA to initiate negotiations with potential responsible parties ("PRPs") to"allow [for] expedient and efficient settlements of potential liability." Dravo Corp. v. Zuber, 13 F.3d 1222, 1227 (8th Cir. 1994); 42 U.S.C. § 9622. If negotiations fail, one option under CERCLA for cleaning a hazardous waste site is for EPA to perform the remediation itself, using money taken out of the Superfund established by Congress. EPA would then bring an action in federal district court under section 107 of CERCLA to recover its costs from parties responsible for the contamination. See 42 U.S.C. §§ 9607(a)(4)(A), 9611(a).

On the other hand, section 106 allows EPA to order parties to clean a site contaminated with hazardous waste, and to file a civil action in federal district court to compel a party to comply with EPA's proposed remedy. 42 U.S.C. § 9606(a). Section 106 administrative orders lie at the heart of GE's due process challenge in this case. See Am. Compl. ¶ 2. Before issuing a section 106 order, EPA must determine"that there may be an imminent and substantial endangerment to the public health or welfare or the environment because of an actual or threatened release of a hazardous substance from a facility." 42 U.S.C. § 9606(a).

Under the penalty provision of section 106(b), any person who,"without sufficient cause," willfully violates a section 106 order, or fails or refuses to comply with such an order, may be fined up to $25,000 for each day the violation or non-compliance continues. Id. § 9606(b). In addition, under section 107, a party who fails to comply with a section 106 order also faces the possibility of punitive damages up to three times"the amount of any costs incurred by the [Superfund] as a result of such failure to take proper action." Id. § 9607(c)(3).

These fines and penalties are not automatic under CERCLA -- EPA must bring a civil action in district court to compel compliance with its order. Even then, the district court has discretion as to whether noncompliance warrants a fine, penalties, or punitive damages, and if so, how much. Id. Under the statute, if the district court determines that a party had"sufficient cause" for not complying with the order, no penalties or fines can be imposed. See id. §§ 9606(b), 9607(c)(3). Even if a party is unable to establish a"sufficient cause" defense, the statute does not mandate issuance of the prescribed fines and penalties, but rather the district court has discretion to determine the amount of civil fines or penalties up to the statutory maximum of $25,000 per day. See id.

The scope, nature and limits of judicial review of EPA actions under CERCLA are set out in section 113. See id. § 9613. The thrust of section 113(h) is that one cannot obtain preenforcement review of EPA orders (including section 106 orders) or EPA response actions with respect to a contaminated site.

II. Procedural History

GE filed its Complaint on November 28, 2000, which it then amended on March 14, 2001. GE's Amended Complaint contains a two-pronged"facial" challenge to CERCLA. First, according to GE, the text of CERCLA itself gives rises to a procedural due process violation because PRPs are never afforded a meaningful hearing to challenge the issuance of an administrative order, and thus suffer a deprivation of property without a hearing; moreover, the CERCLA penalty scheme is so coercive it amounts to a due process violation under Ex Parte Young, 209 U.S. 123 (1908). See Am. Compl. ¶¶ 21-28, 50, 54. Second, GE contends that EPA's"pattern and practice" of administering CERCLA violates GE's due process rights. Id. ¶¶ 17-20, 51-52, 54. Under this second theory, GE alleges that EPA: uses section 106 orders in non-emergency situations; administers the statute to affect a deprivation of property without a hearing; administers section 106 so that PRPs are not provided prompt hearings after suffering a property deprivation; and administers the fines and penalties provisions coercively to create a due process violation under Ex Parte Young.

In March 2001, EPA moved to dismiss GE's Amended Complaint for lack of subject matter jurisdiction. EPA argued that this Court lacked subject matter jurisdiction to consider GE's constitutional challenges to CERCLA because section 113(h) operates to delay judicial review of any section 106 order until after the clean up is complete. This Court granted EPA's motion to dismiss, concluding that section 113(h) precluded judicial review of GE < s="" claims="" as="" framed.="" see="" general="" elec.="" co.,="" 257="" f.supp.2d="" at="" 12.="" on="" march="" 2,="" 2004="" the="" d.c.="" circuit="" reversed="" that="" decision,="" and="" instructed="" this="" court="" on="" remand="" to="" consider="" the="" merits="" of="" what="" it="" called="" ge's="" facial="" due="" process="" challenge="" to="" cercla.="" see="" general="" elec.="" co.,="" 360="" f.3d="" at="">

LEGAL STANDARD

Summary judgment is appropriate when the pleadings and the evidence demonstrate that"there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine dispute of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The moving party may successfully support its motion by"informing the district court of the basis for its motion, and identifying those portions of'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Id. (quoting Fed.R.Civ.P. 56(c)).

In determining whether there exists a genuine issue of material fact sufficient to preclude summary judgment, the court must regard the non-movant's statements as true and accept all evidence and make all inferences in the non-movant's favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). A non-moving party, however, must establish more than the"mere existence of a scintilla of evidence" in support of its position. Id. at 252. By pointing to the absence of evidence proffered by the non-moving party, a moving party may succeed on summary judgment. Celotex, 477 U.S. at 322."If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson, 477 U.S. at ...


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