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Environmental World Watch, Inc. v. Walt Disney Co.


October 19, 2009


The opinion of the court was delivered by: Dean D. Pregerson United States District Judge

Order Denying Defendants' Motion to Dismiss [Motion filed on September 3, 2009]

Presently before the Court is Defendants Walt Disney Company, Disney Worldwide Services, Inc., and Walt Disney Enterprises' (together "Disney") motion to dismiss for lack of standing and for failure to state a claim. After reviewing the parties' moving papers and hearing oral argument, the Court denies the motion.

I. Background

Plaintiffs in this action are Environmental World Watch, Inc. ("EWW"), a Delaware corporation based in Los Angeles County, and several individuals that live and recreate in the vicinity of Disney's commercial property in Burbank, CA. Disney is a worldwide entertainment company with headquarters located at 500 South Buena Vista Street in Burbank, California (the "Studio Lot"). (Second Amended Complaint ("SAC") ¶ 14.)

According to the SAC, Disney has operated a 50-acre film production, broadcast, and office facility at the 500 South Buena Vista Street Property since approximately 1939. (SAC, Ex. A at 25.) Plaintiffs contend that, for decades, Disney has pumped water from the ground for use in its air-cooling system, added various chemical compounds to the cooling waters, and then discharged the spent water through "well water disposal lines" and pipes. (Id.) As a result, they contend, Disney has discharged hexavalent chromium ("Cr VI") into the land, water, and air surrounding the Studio Lot. (Id.)

The SAC alleges that Disney continued to discharge Cr VI even after EPA banned use of the compound in air-cooling systems in 1990, and that discharges occurred regularly over the past five years (i.e., within the applicable statute of limitations period).*fn1

(Id. at 26.)

According to Plaintiffs, the contaminated cooling water traveled through three pipes and emptied into the street at the intersection of Keystone and Parkside (in Burbank), eventually contaminating the aquifer below the City of Los Angeles's Polliwog Park. (Id.) At some point, Plaintiffs contend, those three pipes were connected to a City of Burbank storm drain that runs under the intersection of Keystone and Parkside, immediately east of the 500 South Buena Vista Street property line, and empties into the Los Angeles River. (Id. at 29, 35.)

The SAC alleges that testing conducted on May 1, 2009 and every day thereafter at "the discharge pipe terminus into the Los Angeles River" revealed that "quantities of Cr VI found in samples of H20 and H20 sludge as residue exceed the Maximum Contaminant Level (MCL) for Cr VI in drinking water and the No Significant Risk Level (NSRL) under Ca Health and Safety Code section 25249.5, et seq."*fn2 (Id. at 35 n. 1.)

After sending notices of intent to file suit on May 22, 2009, June 1, 2009, and June 18, 2009, Plaintiffs sued Disney for violations of the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6901 et seq. and the Clean Water Act ("CWA"), 33 U.S.C. § 1251 et seq., pursuant to both statutes' citizen suit provisions. They filed a first amended complaint on June 23, 2009, (Dkt. No. 4), and pursuant to the parties' stipulation, (Dkt. No 12), a second amended complaint on August 14, 2009, (Dkt. No 14.)

The SAC alleges that Disney is a past or present generator, transporter, owner or operator "of a treatment, storage, or disposal facility, which has contributed or is contributing to the past or present storage, treatment, transportation, and/or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment." (SAC ¶ 51); see 42 U.S.C. § 6972(a)(1)(B). They specifically allege the following: (1) violations of the procedural and substantive requirements of RCRA section 3004, 42 U.S.C. § 6924, (SAC ¶ 56); (2) un-permitted handling, treatment, storage, transportation and/or disposal of hazardous waste pursuant to 42 U.S.C. § 6925 (SAC ¶ 64); and (3) violating the prohibition on open dumping pursuant to 42 U.S.C. § 6945 (SAC ¶ 67.)

Plaintiffs also allege that Disney is discharging pollutants from a point source without a National Pollutant Discharge Elimination System ("NPDES") permit in violation of CWA § 301, 33 U.S.C. § 1311, and that they are discharging storm water contaminated with industrial pollutants in violation of CWA § 402(p), 33 U.S.C. § 1342(p). (SAC ¶¶ 75-76.)

Disney moves to dismiss the SAC for failure to state a claim upon which relief can be granted, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, and for lack of Article III standing. They contend that "the RCRA causes of action (one through five of the SAC) should be dismissed because Plaintiffs fail to identify a 'hazardous waste' . . . and fail to describe where and when the hazardous waste allegedly was disposed in the last five years." (Mot. at 3.)

With respect to the CWA causes of action (six and seven in the SAC), Disney argues that Plaintiffs "fail to adequately allege discharge of a particular pollutant from a particular point source" and as to count seven, that Disney does not need a NPDES permit in order to discharge storm water because they are covered by the City of Burbank's municipal storm water permit. (Id.)

II. Legal Standard

Pursuant to Federal Rule of Procedure Rule 12(b)(6), a complaint is subject to dismissal when the plaintiff's allegations fail to state a claim upon which relief can be granted. When considering a Rule 12(b)(6) motion, courts accept the plaintiff's allegations of material fact as true, and construe the complaint in the light most favorable to the non-moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996).

In Ashcroft v. Iqbal, 129 S.Ct. 1937, 1950 (2009), the Supreme Court explained that a court considering a 12(b)(6) motion should first "identify[] pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth."

Id. Next, the court should identify the complaint's "well-pleaded factual allegations, . . . assume their veracity and then determine whether they plausibly give rise to an entitlement to relief."

Id.; see also Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) ("In sum, for a complaint to survive a motion to dismiss, the non-conclusory factual content, and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." (internal quotation marks omitted)).

III. Discussion

A. Standing

In order to satisfy Article III's standing requirements, a plaintiff must show:

(1) it has suffered an injury in fact that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.

Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81 (2000) (internal quotation marks omitted). At the motion to dismiss stage, allegations are presumed to be correct, and thus "general factual allegations of injury resulting from the defendant's conduct may suffice" to establish the prerequisites for standing. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992).

"[E]nvironmental plaintiffs adequately allege injury in fact when they aver that they use the affected area and are persons 'for whom the aesthetic and recreational values of the area will be lessened' by the challenged activity." Friends of the Earth, 528 U.S. at 183 (quoting Sierra Club v. Morton, 405 U.S. 727, 735 (1972)); see also Desert Citizens Against Pollution v. Bisson, 231 F.3d 1172, 1176 (9th Cir. 2000) ("We have held repeatedly that environmental and aesthetic injuries constitute injuries in fact for standing purposes.").

Plaintiffs submitted declarations from two EWW board members with their Opposition. Board member William Dunlap states that he lived near the 500 South Buena Vista Street Property in 2006 when the contamination in Polliwog Park was discovered, and that he has regularly walked, exercised, and ridden his horse in the vicinity of the alleged Cr VI contamination. The Court concludes that Dunlap's allegations are sufficient to confer standing. See Interfaith Cmty. Org. v. Honeywell Int'l, Inc., 399 F.3d 248, 255 (3d Cir. 2005) (RCRA plaintiffs satisfied injury in fact requirement where they alleged that they lived near former site of chromium manufacturing and were concerned about health risks caused by exposure to Cr VI from the site).

Because EWW has alleged that one of its members has suffered an injury in fact sufficient to confer Article III standing, the Court concludes that the organization itself has established standing. See Friends of the Earth, 528 U.S. at 181 (noting that an organization has standing to bring suit on behalf of its members where members could sue in their own right, the interests involved are germane to the organization's purpose, and the requested relief does not require the participation of individual members in the suit).


The Court concludes that Plaintiffs have alleged facts plausibly suggesting that Disney has disposed of a "hazardous waste" within the meaning of RCRA. The facts alleged, taken as true, suggest that Disney released Cr VI from the 500 South Buena Vista Street Property. While Plaintiffs have not conclusively proved that the alleged Cr VI discharges are of a sufficient concentration to qualify as hazardous under EPA's regulatory definition, they are not required to do so at the pleading stage.

RCRA "is a comprehensive environmental statute that empowers EPA to regulate hazardous wastes from cradle to grave, in accordance with . . . rigorous safeguards and waste management procedures." Chicago v. Envtl. Def. Fund, 511 U.S. 328, 331 (1994).

RCRA defines the term "hazardous waste," in relevant part, as:

[A] solid waste, or combination of solid wastes, which because of its quantity, concentration, or physical, chemical, or infectious characteristics may cause, or significantly contribute to an increase in mortality or an increase in serious irreversible, or incapacitating reversible, illness . . . or pose a substantial present or potential hazard to human health or the environment when improperly treated, stored, transported, or disposed of, or otherwise managed.

42 U.S.C. § 6903(5).*fn3

The Act requires EPA to regulate the identification, disposal, and treatment of hazardous waste, and directs the EPA Administrator to "promulgate regulations identifying the characteristics of hazardous waste, and listing particular hazardous wastes (within the meaning of section 6903(5) of this title), which shall be subject to the provisions of this subchapter." 42 U.S.C. § 6921(b)(1). Pursuant to § 6921, EPA may deem wastes hazardous if:

They possess one of the four hazardous characteristics identified by the EPA in 40 C.F.R. Part 261, Subpart C ("characteristic wastes"), see id. § 261.3(a)(2)(I) (1991), or have been found to be hazardous as a result of an EPA rulemaking. See id. Part 261, Subpart D ("listed wastes"). Chem. Waste Mgmt., Inc. v. EPA, 976 F.2d 2, 7-8 (D.C. Cir. 1992). EPA's regulations provide that solid waste containing chromium is "hazardous waste," within the meaning of RCRA, where the chromium concentration exceeds 5 mg/L (which is equivalent to 5 parts per million ("ppm") or 5,000 parts per billion ("ppb")).*fn4 40 C.F.R. § 261.24.

Disney "do[es] not dispute that waste containing a sufficiently high concentration of Cr VI could potentially be considered a hazardous waste under RCRA." (Defs.' Reply at 3.) It contends, however, that Plaintiffs have not alleged facts suggesting that Disney discharged waste containing a Cr VI concentration that exceeds EPA's toxicity threshold.

The Court disagrees.

Under Iqbal, the Court must first dispatch the allegations contained within the SAC that do nothing more than state a legal conclusion, and then evaluate the remaining factual content to determine whether the SAC states a RCRA claim that is plausible on its face. Cf. Doe I v. Wal-Mart Stores, Inc., 572 F.3d 677, 683 (9th Cir. 2009) ("Plaintiffs' general statement that Wal-Mart exercised control over their day-to-day employment is a conclusion, not a factual allegation stated with any specificity. We need not accept Plaintiffs' unwarranted conclusion in reviewing a motion to dismiss.") Accordingly, the Court assigns no weight to Plaintiffs' conclusory recitations of the elements of a RCRA claim. (See, e.g., SAC ¶ 30.) ("DEFENDANTS have discharged or are intentionally and illegally continuing to discharge hazardous waste in violation of RCRA and the CWA.")

The SAC, however, consists of more than just conclusory assertions -- it states specific facts that the Court must assume are true. Plaintiffs contend that Disney continues to add Cr VI to the water it uses in its air cooling system (in spite of the EPA ban) and that the spent water is being discharged into the Los Angeles River through a particular storm drain pipe, the location of which is identified in the SAC.*fn5 They further allege that testing at the terminus of the storm drain at issue revealed Cr VI concentrations that exceed California's water quality standards.

Taking these facts together, and drawing all reasonable inferences in Plaintiffs' favor, the SAC plausibly suggests that Disney disposed of Cr VI in a concentration that would render it a hazardous waste within the meaning of RCRA.

Disney points out that California's water quality standards with respect to chromium are far more stringent than the federal standard.*fn6 RCRA does not authorize citizen suits predicated on violations of state standards that are more stringent then the applicable federal standard. See Ashoff v. Ukiah, 130 F.3d 409, 412 (9th Cir. 1997). Thus, a waste cannot be deemed hazardous, within the meaning of RCRA, solely because it contains a chromium concentration that violates California's water quality standards.

Even so, Plaintiffs are not required to prove that Disney is disposing of a specific concentration of Cr VI at the pleading stage -- they need only plead facts that plausibly suggest a Cr VI release that exceeds the federal standard. Plaintiffs discovery of Cr VI at a storm drain terminus that, they allege, deposits waste from the Studio Lot, coupled with their allegation that Disney continues to use Cr VI in its air-cooling system (in violation of federal law), is sufficient to state a claim under RCRA.


Plaintiffs contend that Disney is discharging pollutants from a point source without an NPDES permit in violation of CWA § 301, 33 U.S.C. § 1311, (SAC ¶ 72), and that it is discharging storm water contaminated with industrial pollutants in violation of CWA § 402(p), 33 U.S.C. § 1342(p), (SAC ¶¶ 75-76).

In order to state a prima facie case under § 301, Plaintiffs must allege facts suggesting that Disney: (1) discharged (2) a pollutant (3) from a point source (4) to navigable waters (5) without an NPDES permit. See Comm. to Save Mokelumne River v. E. Bay Mun. Util. Dist., 13 F.3d 305, 309 (9th Cir. 1993).

The Court concludes that Plaintiffs have stated a § 301 claim. Disney contends that Plaintiffs have not identified discharges of a specific pollutant from a particular point source, but as the Court explains above in its discussion of Plaintiffs' RCRA claims, they have adequately so alleged. The SAC states facts suggesting that Disney's facility is a point source within the meaning of the CWA, and that it discharged a pollutant (i.e., Cr VI) from the facility's air-cooling system into navigable waters without a NPDES permit.

With respect to Plaintiffs' CWA § 402(p) claim, Disney contends that it does not need a permit to discharge storm water containing Cr VI because the operative municipal storm water and urban runoff permit -- the Los Angeles County MS4 Permit*fn7 (which includes the City of Burbank) -- grants Burbank "adequate legal authority" to "prohibit non-storm water discharges to the storm drain system . . . ." (Mot. to Dismiss 14.)

Disney offers no support for its contention that Burbank's legal authority to prohibit non-storm water discharges, under the terms of the MS4 Permit, forecloses Plaintiffs' claim under the CWA. Further, the MS4 permit states that "[u]nauthorized non-storm water discharges (even when commingled with storm water) shall be eliminated or covered by a separate NPDES permit." (Silver Decl., Ex. A at 11.) Accordingly, the Court concludes that Plaintiffs have stated a claim under § 402(p) of the CWA.

D. Request for a Stay

Disney asks the Court to stay this case pursuant to Federal Rule of Civil Procedure 41(d), which provides the following:

If a plaintiff who previously dismissed an action in any court files an action based on or including the same claim against the same defendant, the court: (1) may order the plaintiff to pay all or part of the costs of that previous action; and (2) may stay the proceedings until the plaintiff has complied.

Fed. R. Civ. P. 41(d).

On January 10, 2007, EWW and several individuals including one of the plaintiffs in this action, served Disney with a notice of violation, alleging that it was discharging wastewater containing Cr VI from the Studio Lot in violation of California's Proposition 65. (Defs.' Mot at 4.) EWW then filed a lawsuit in Los Angeles Superior Court against Disney on June 1, 2007. (Id.) On August 15, 2007, that action was dismissed for failure to file a proof of service. (Id.)

A few months later, on October 29, 2007, EWW filed a second lawsuit in state court alleging the same claims. (Id.) After a year of active litigation, EWW voluntarily dismissed the case on November 7, 2008. (Id.) On February 5, 2009, the court granted a judgment of costs in favor of Disney. (Id. at 5.) EWW has yet to satisfy the judgment. (Id.)

Disney contends that, because the previously dismissed action concerned the same claims at issue in this case, the Court should stay this case until EWW satisfies the judgment of costs entered in the prior state court action.

The present case, unlike EWW's prior state court action, presents claims arising under federal law. Further, some of the individual plaintiffs in this action were not party to the previous lawsuit. Accordingly, the Court concludes that a stay is not warranted.

IV. Conclusion

For the reasons set forth above, the Court DENIES Disney's Motion to Dismiss.


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