Fireman's Fund Ins. Co. v. Lodi, Cal., City of
ELR Citation: ELR 20234 No(s). 99-15614 (9th Cir. Oct 30, 2001)
The court holds that the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and California state law do not preempt the field of hazardous waste remediation either explicitly or by implication, but that certain sections of a municipality's hazardous waste law are nevertheless preempted by state and federal law under the doctrine of conflict preemption. After discovering groundwater contamination, and in an effort with the state environmental agency to clean up the contamination, the municipality enacted a hazardous waste remediation law, the Comprehensive Municipal Environmental Response and Liability Ordinance (MERLO), modeled on CERCLA and the Carpenter-Presley-Tanner Hazardous Substances Account Act (HSAA), which is a state hazardous waste law. Two insurers of potentially responsible parties (PRPs) brought suit against the municipality claiming that MERLO was preempted by state and federal law.
The court first holds that the district court erred in abstaining from deciding whether MERLO is preempted by state law. Although the interpretation of a local ordinance that enables the city to pay for hazardous waste remediation it could not otherwise afford is undoubtedly an area of serious local concern, it cannot truly be said that federal intrusion is undesirable, thereby eliminating the court's responsibility to determine whether the municipality's law is preempted by state or federal law. Additionally, the court cannot say that there is a reasonable possibility that a state court's clarification of state law might obviate the need for the federal constitutional ruling. The court next holds that MERLO is not preempted by CERCLA and the HSAA under the doctrine of field preemption. CERCLA anticipates that states will enact supplemental remedial environmental legislation, and CERCLA does not preclude states from redelegating their authority to political subdivisions. Similarly, the HSAA contemplates the ability of cities to adopt parallel municipal environmental ordinances and participate in the process of hazardous waste remediation. The court, however, then holds that portions of MERLO that allow the municipality to bring direct actions against a PRP's insurer beyond what is permitted by California law protect the municipality from contribution claims by other PRPs and have a burden of proof standard that is inconsistent with the HSAA. These sections, therefore, are preempted due to conflict preemption.
A prior decision in this litigation is published at 29 ELR 21161.]
Counsel for Plaintiff
Terry J. Houlihan
McCutchen, Doyle, Brown & Enersen
Three Embarcadero Ctr., Ste. 1800, San Francisco CA 94111
(415) 393-2000
Counsel for Defendants
Michael C. Donovan, Ass't City Attorney
City Attorney's Office
3675 Mt. Diablo Blvd., Ste. 210, Lafayette CA 94549
(925) 284-1968
Pregerson, J. Before Nelson and Moskowitz,1 JJ.