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City of Rialto v. West Coast Loading Corp.

August 14, 2009

CITY OF RIALTO, A CALIFORNIA MUNICIPAL CORPORATION; RIALTO UTILITY AUTHORITY, A JOINT POWERS AUTHORITY ORGANIZED AND EXISTING UNDER THE LAW OF THE STATE OF CALIFORNIA, PLAINTIFFS,
v.
WEST COAST LOADING CORPORATION, A CALIFORNIA CORPORATION; KWIKSET LOCKS, INC., A CALIFORNIA CORPORATION; EMHART INDUSTRIES, INC.; AMERICAN HARDWARE CORPORATION, A CONNECTICUT CORPORATION; BROCO ENVIRONMENTAL, INC.; ENVIRONMENTAL ENTERPRISES, INC.; AMERICAN PROMOTIONAL EVENTS, INC., WEST; PYRO SPECTACULARS, INC.; TROJAN FIREWORKS; ASTRO PYROTECHNICS; ZAMBELLI FIREWORKS MANUFACTURING CO.; RAYTHEON COMPANY; GENERAL DYNAMICS CORPORATION; TUNG CHUN COMPANY; WONG CHUNG MING, A/K/A CHUNG MING WONG; WHITTAKER CORPORATION; AMEX PRODUCTS, INC., F/K/A AMERICAN EXPLOSIVES COMPANY; TASKER INDUSTRIES; GOLDEN STATE EXPLOSIVES; EXPLOSIVE TECHNOLOGIES INTERNATIONAL, INC. (ETI), CALIFORNIA; EDWARD STOUT; ELIZABETH RODRIGUEZ; JOHN CALLAGY, AS TRUSTEE OF THE FREDERIKSEN CHILDREN'S TRUST UNDER TRUST AGREEMENT DATED FEBRUARY 20, 1985; LINDA FREDERIKSEN, AS TRUSTEE OF THE WALTER M. POINTON TRUST DATED 11/19/91 AND AS TRUSTEE OF THE MICHELLE ANN POINTON TRUST UNDER TRUST AGREEMENT DATED FEBRUARY 15, 1985; MARY MITCHELL; JEANINE ELZIE; STEPHEN CALLAGY; THE MARQUARDT COMPANY, F/K/A MARQUARDT CORPORATION; FERRANTI INTERNATIONAL, INC.; ENSIGN- BICKFORD COMPANY; ORDNANCE ASSOCIATES; THOMAS O. PETERS; DENOVA ENVIRONMENTAL, INC.; BLACK & DECKER (USA) INC.; KWIKSET CORPORATION; THOMAS O. PETERS REVOCABLE TRUST; PYROTRONICS CORPORATION; DELTA T., INC., E/S/A AMEX PRODUCTS, INC.; COUNTY OF SAN BERNARDINO; AND ROBERTSON'S READY MIX, INC., DEFENDANTS,
v.
GOODRICH CORPORATION, A NEW YORK CORPORATION, PLAINTIFF/THIRD-PARTY PLAINTIFF-APPELLANT,
v.
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY; UNITED STATES OF AMERICA, THIRD-PARTY DEFENDANTS- APPELLEES, AND UNITED STATES DEPARTMENT OF DEFENSE, DEFENDANT/THIRD-PARTY DEFENDANT-APPELLEE.



Appeal from the United States District Court for the Central District of California Philip S. Gutierrez, District Judge, Presiding D.C. No. CV-00079-PSG-SS.

The opinion of the court was delivered by: Graber, Circuit Judge

FOR PUBLICATION

Argued and Submitted June 3, 2009 -- Pasadena, California

Before: Pamela Ann Rymer and Susan P. Graber, Circuit Judges, and Ann Aldrich,*fn1 District Judge.

OPINION

We must decide whether the availability of judicial review for "pattern and practice" claims, as discussed in McNary v. Haitian Refugee Center, Inc., 498 U.S. 479 (1991), extends to a claim brought by Goodrich Corporation challenging the United States Environmental Protection Agency's ("EPA") administration of unilateral administrative orders under 42 U.S.C. § 9606(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"). We hold that it does not and, therefore, affirm the district court's dismissal of Goodrich's claim for lack of jurisdiction.

FACTUAL AND PROCEDURAL HISTORY

The Rialto-Colon groundwater basin is an important source of water for San Bernardino County, California. The EPA has detected groundwater contaminants, including perchlorate and trichloroethylene, in municipal supply wells in the basin. The EPA suspects that the source of the contaminants may be a particular 160-acre site in Rialto, California ("Rialto site"). The Rialto site has been, and is currently, used for industrial and commercial purposes. From approximately 1957 to 1962, Goodrich operated the site and conducted activities that may have contributed to pollution there.

CERCLA authorizes the EPA to issue unilateral administrative orders ("UAO") "as may be necessary to protect public health and welfare and the environment," if the EPA "deter-mines 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). In July 2003, the EPA issued a unilateral administrative order concerning the Rialto site ("UAO 2003-11" or "Order"). The Order directs Goodrich (and one other previous operator) to conduct a remedial investigation for contaminants. The "minimum investigation requirements" specified by the Order include detailed soil sampling and groundwater monitoring. Goodrich chose to comply with the Order and, accordingly, began the remedial investigation. Goodrich alleges that, at all times, it has complied with the Order.

On December 8, 2006, Goodrich filed a complaint ("initial complaint") against the City of Rialto, the Rialto Utility Authority, the United States Department of Defense, and the EPA in federal district court.*fn2 The initial complaint alleged contribution claims against the City, the Utility Authority, and the Department of Defense and a due process claim against the EPA. The contribution claims alleged that the contaminants originated, in whole or in part, from the activities of the other parties. The due process claim was premised on the allegation that, contrary to the EPA's position, per chlorate is not a "hazardous substance" subject to regulation by CERCLA. The initial complaint alleged that the CERCLA review provisions, on their face and as administered by the EPA, comprise a "coercive and fundamentally unfair regime" that violates due process.

Goodrich settled its contribution claims with the City and the Utility Authority and therefore withdrew those claims. The Department of Defense and the EPA filed a joint motion for judgment on the pleadings.

The district court denied the motion with respect to the claims against the Department of Defense but granted the motion with respect to the claims against the EPA. The court held that Goodrich could bring its contribution claims against other potentially responsible parties ("PRPs"), including the Department of Defense, because it "met the criteria for bringing suit under both [42 U.S.C. §§ 9607 and 9613]." The court held that it lacked jurisdiction over Goodrich's as-applied challenge to CERCLA's review provisions concerning the EPA's administration of UAO 2003-11. Specifically, the court held that "it is clear that [Goodrich] is attempting to obtain pre-enforcement review of the UAO issued to it by the EPA" and that such review is foreclosed by 42 U.S.C. § 9613(h). The court next held that it had jurisdiction over Goodrich's facial challenge to CERCLA's review provisions, but rejected that claim on the merits. Finally, the district court held that, contrary to Goodrich's arguments, the initial complaint did not assert a "pattern and practice" claim.

Goodrich did not appeal that dismissal. Instead, it filed a first amended complaint ("complaint"). That complaint reiterates the contribution claims against the Department of Defense and clearly alleges a "pattern and practice" claim against the EPA. The complaint characterizes UAOs as "emergency orders" and alleges that the EPA "routinely" issues emergency orders "where no conceivable emergency exists," thereby "read[ing] the emergency requirement entirely out of the statute." The complaint also alleges that the EPA "obstruct[s] judicial review of those orders by delaying its discretionary certification of completion." Finally, the complaint alleges that the EPA "control[s] and manipulat[es]... the 'Record of Decision' which supports the agency's selection of a response action. That record is compiled entirely by US EPA, and amounts to nothing more than a one-sided advocacy document favoring the agency's choices." Goodrich seeks a judicial declaration that US EPA's pattern and practice in administering CERCLA's unilateral administrative orders regime embodied in [42 U.S.C. §§ 9606, 9607(c)(3), and 9613(h)] is unconstitutional and, therefore, the UAO issued to [Goodrich] is unenforceable because it was issued pursuant to unconstitutional procedures.

The EPA filed a motion for judgment on the pleadings. The district court granted the motion, holding that it lacked jurisdiction over the "pattern and practice" claim because of the jurisdiction-stripping provision contained in 42 U.S.C. § 9613(h). The district court entered a final judgment on the "pattern and practice" claim pursuant to Federal Rule of Civil Procedure 54(b). Goodrich timely appeals.

DISCUSSION

We review de novo whether subject matter jurisdiction exists. Schnabel v. Lui, 302 F.3d 1023, 1029 (9th Cir. 2002).

A. Statutory Framework

[1] CERCLA "was designed to promote the timely cleanup of hazardous waste sites and to ensure that the costs of such cleanup efforts were borne by those responsible for the contamination." Burlington N. & Santa Fe Ry. Co. v. United States, 129 S.Ct. 1870, 1874 (2009) (internal quotation marks omitted). "As its name implies, 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). The Supreme Court has described the two primary methods of effecting cleanup: "Under CERCLA, the Federal Government may clean up a contaminated area itself, see § 104 [42 U.S.C. § 9604], or it may compel responsible parties to perform the cleanup, see § 106(a) [42 U.S.C. § 9606(a)]." Cooper Indus., Inc. v. Aviall Servs., Inc., 543 U.S. 157, 161 (2004) (citation omitted).

Under the first option (which is not at issue here), the government pays for the cleanup under § 9604 and then seeks recovery for its costs from PRPs under § 9607. This option has an obvious drawback for the government: It must pay first and sue for recovery of costs later (often in protracted litigation). The second option-compelling PRPs to perform the cleanup-therefore has its advantages. As the Eighth Circuit noted, "[s]ince Superfund money is limited, Congress clearly intended private parties to assume clean-up responsibility." Solid State Circuits, Inc. v. EPA, 812 F.2d 383, 388 (8th Cir. 1987).

[2] Under the second option (which was used here), the EPA can issue UAOs to compel cleanup and other remedial measures under 42 U.S.C. § 9606(a).*fn3 That statute provides:

In addition to any other action taken by a State or local government, when the President determines 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, he may require the Attorney General of the United States to secure such relief as may be necessary to abate such danger or threat, and the district court of the United States in the district in which the threat occurs shall have jurisdiction to grant such relief as the public interest and the equities of the case may require. The President may also, after notice to the affected State, take other action under this section including, but not limited to, issuing such orders as may be necessary to protect public health and welfare and the environment.

Once the EPA issues a UAO against a party, that party can obtain judicial review to challenge the validity of the UAO. But Congress limited the timing of such review in 42 U.S.C. ยง 9613(h). That ...


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