ELR Citation: ELR 20257
No(s). 86-C-0902G (D. Utah Sep 3, 1992)

The court rejects a consent decree proposed by Utah and a mining operator containing a negotiated monetary settlement for damages to Utah's interest in groundwater contaminated by the operator's mining activities, because the decree is not just and fair or consistent with the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). After the mining operator undertook studies to assess surface and groundwater contamination of a 216-square-mile area affected by mining and milling operations in the Bingham Mining District, but before the completion of those studies or an environmental impact assessment (EIA), the parties moved that the court approve a proposed consent decree requiring a negotiated monetary settlement for natural resources damages. Although the factual record was not fully developed, the parties based the proposed settlement on the conclusion that restoration was not feasible and the loss-of-value method of measuring damages was the appropriate remedy. In response, a Utah water conservancy district sought to intervene and was granted permissive intervention. Subsequently, the court declined approval of the settlement pending an evidentiary hearing to determine the merits of the settlement.

The court first notes that Utah's failure to follow the existing federal regulations in making its determinations, although not required to do so, eliminates the presumption of validity and correctness that the state would otherwise enjoy. The court holds that the settlement contained in the proposed consent decree is deficient in at least three major respects. First, Utah and the mining operator failed to demonstrate by a preponderance of evidence that the infeasibility of restoration and plume remediation justify the state's determination not to require these elements in the proposed consent decree. Utah failed to require the mining operator to complete a final EIA, which would have set forth and assessed possible remedial alternatives. Thus, failure to develop sufficient factual foundation to support the state's determination that contaminated groundwater cannot be remediated requires rejection of the decree for failure to demonstrate that the remedial purposes CERCLA is intended to achieve cannot be achieved. Second, Utah and the mining operator did not present a sufficient factual predicate to convince the court that the proposed consent decree would be just and fair without a covenant to perform necessary additional source control and to provide for containment and management of the existing contamination. Even though the state determined that it would be infeasible to restore the contaminated natural resource, it could have required such a covenant. Further, although Utah does not waive its right to require source control by entering the proposed consent decree, the decree fails to impose any substantial duties on the mining operator in the face of apparent contaminated plumes that are being further contaminated by the mining operator. Third, the court adopts the rule of law established in Ohio v. U.S. Dep't of the Interior, 19 ELR 21099, and holds that the proposed consent decree must be rejected, because it is based on inadequate consideration of damages for the failure to demonstrate to the court the existence of substantive fairness under CERCLA. The Court of Appeals for the District of Columbia rejected the "lesser of" approach in Ohio, and held that CERCLA mandates a distinct preference for restoration costs as a measure of damages. In this action, Utah failed to calculate into the settlement the costs of preventing the plumes from spreading and contaminating the remaining unspoiled portion of the aquifer, by pumping water or other methods. Further, the state did not require the cost of further source control that would at least lessen contamination from continuing on a daily basis.

Finally, the court grants a Utah water conservancy district permissive intervention. The district's petition was timely, the district has a substantial stake in the subject of the proposed consent decree—without intervention the district's ability to protect its interests may be impaired or impeded—and the parties to the proposed decree might not adequately protect the interests of the district.

Counsel for Plaintiff
Joseph E. Tesch, Ass't Attorney General
Attorney General's Office
4120 State Office Bldg., 4th Fl., Salt Lake City UT 84114
(801) 538-1017

Counsel for Defendant
James B. Lee, Daniel M. Allred
Parsons, Behle & Latimer
201 S. Main St., Ste. 1800, Salt Lake City UT 84111
(801) 532-1234

Counsel for Intervenor
Douglas J. Parry
Parry, Murray, Ward & Cannon
1270 Eagle Gate Tower, Salt Lake City UT 84111
(801) 521-3434