ELR Citation: ELR 20992
No(s). s. 92-35061 et al (9th Cir. Apr 28, 1994)

The court withdraws its opinion published at 23 ELR 21504, and affirms a district court's holding that a copper smelter is liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) for costs of cleaning up heavy-metal leachate from slag at several sites. The smelter disposed of the slag at some of the sites, and at other sites purchasers used it for ballast in logyards. The court first holds that CERCLA §101(14)(C) does not exempt slag waste from the definition of "hazardous substance" contained in other subsections of §101(14). If Congress intended to except slag from the other subsections, it would have used a more general exception, as it did for petroleum products. The court holds that even if §101(14) were ambiguous, any ambiguity has been laid to rest because the U.S. Environmental Protection Agency, which is charged with administering CERCLA, has interpreted §101(14) to mean that the exception in subsection (C) refers only to that subsection. The court holds that because the components that slag leaches into the soil fall within at least one of the other subsections of §101(14), slag is regulated as a hazardous substance by CERCLA. The court holds that a jury finding that slag is a "product" under the Washington Products Liability Act (WPLA) did not preclude the district court from finding that it is a waste under CERCLA, because the WPLA and CERCLA address different concerns. The court rejects the smelter's contention that the owner and operator of one site failed to comply with the notice-and-comment provisions of the national contingency plan (NCP) in choosing paving as an option. Noting that the parties agree that strict compliance with the NCP is not required, the court holds that the owner and operator substantially complied with the NCP, because the owner held six meetings on cleanup. The fourth and fifth meetings occurred after preparation of a feasibility study outlining cleanup options. And the cleanup plan was discussed at two later meetings that were well advertised, open to the public, and more than 21 days apart. Also, the feasibility study was available for public examination. The court holds that the district court's finding that the final decision on paving was not made until the last meeting was not clearly erroneous. The court affirms the district court's award of litigation expenses under CERCLA, because these expenses are generally allowed to the prevailing party in federal court under Fed. R. Civ. P. 54(d).

Turning to the state-law claims, the court reverses the judgment against the smelter for attorneys fees and prejudgment interest under Washington's Hazardous Waste Management Act (HWMA). The court holds that the private cause-of-action amendment to the HWMA does not apply retroactively, because the amendment does not contain a retroactivity provision. Also, in a case where the Washington Supreme Court held that the remedial nature of a statute reverses the presumption against retroactivity, the statute applied to recovery from the state. Here, the amendment creates a private cause of action for damages. The court rejects the argument that judgment against the smelter was appropriate because the injury is ongoing. No court has allowed recovery for an ongoing injury under the HWMA, and plaintiffs have cited no cases imposing ongoing liability on nonowners under §7002 of the Resource Conservation and Recovery Act, which is analogous to the HWMA provision.

The court next holds that the WPLA precludes recovery of damages for lost property use, because the Act overruled a Washington Supreme Court case that granted consequential damages that are indistinguishable in nature from those sought in this case. The court holds that the statute of limitations with respect to the site owners' claims for the remaining damages under the WPLA began to run when they became aware, or should have become aware, of contamination of their properties. The court notes that the limitations period for the site lessees' claims began to run when they suffered actual and appreciable harm. The court remands to the district court the question whether the lessees suffered actual and appreciable harm as a result of the contamination and, if so, when the statute of limitations periods began to run for each of the lessees who suffered such harm. The court holds that the statute of limitations does not run against plaintiff Port of Tacoma, because the port acted in its sovereign capacity in leasing the contaminated logyards. The Washington Constitution provides that areas designated by the port commission up to 2,000 feet from the harbor line shall be reserved for conveniences of navigation and commerce and specifically provides for the leasing of these areas. The court holds that the term "other conveniences of navigation and commerce" includes logyards. The court finds that in leasing the property, the port did not act as a private party would act, because it was motivated by nonmonetary concerns.

The court reverses the district court's dismissal of claims under the Washington Model Toxics Control Act (WMTCA). The district court held that the WMTCA did not create a private cause of action. The appellate court, however, holds that an amendment to the WMTCA creates a private right of action and makes it retroactive. The court rejects the smelter's argument that the amendment was not intended to be retroactive in cases already decided by the trial court and pending on appeal. The general rule in Washington is that statutes that are retroactive apply to pending litigation. The court holds that plaintiffs' failure to contest the district court's dismissal in their appellate briefs did not waive their right to challenge the dismissal on appeal. Plaintiffs filed timely notices of appeal from the dismissal, but did not challenge the ruling in their appellate briefs when the Washington Supreme Court confirmed the propriety of the district court's ruling. When the Washington Legislature changed the law, they promptly brought this to the appellate court's attention. The court ordered supplementary briefing, and both sides had a full and fair opportunity to brief the merits of their positions. The court remands to the district court the question whether the plaintiffs are entitled to prevail on their WMTCA claims and, if so, what damages, attorney fees, prejudgment interest, and other recovery they may be entitled to. The court holds moot plaintiffs' claim that the district court erroneously reduced the amount of attorney fees awarded to them under CERCLA, because attorney fees are not recoverable under CERCLA. And the court holds moot plaintiffs' claim that the district court should not have dismissed their nuisance claims. Any damages recoverable on the nuisance claims are subsumed within the recovery the court upheld in favor of plaintiffs under CERCLA.

[Prior decisions in this litigation are published at 20 ELR 21452, 21079; 23 ELR 21503, 21504.]

Counsel for Plaintiffs
Jeffrey K. Leppo, Karen McGaffey
Bogle & Gates
Two Union Sq., 601 Union St., Seattle WA 98101
(206) 682-5151

Counsel for Defendant
Peter A. Wald, M. Laurence Popofsky
Heller, Ehrman, White & McAuliffe
333 Bush St., San Francisco CA 94104
(415) 772-6000

Before Wright and Kleinfeld, JJ.