Eighth Circuit Lifts Ban on Reserve's Asbestos Dumping in Lake Superior, Finds No "Demonstrable Hazard"

As man's technology has grown exponentially, so has the number of industrial byproducts which are introduced into the nation's environment, frequently with little or no research done prior to production to discover possible deleterious effects. Even where attempts have been made to analyze and predict hazards, advances in scientific knowledge often expose years later the inadequacy of the prior research methods and the inaccuracy of conclusions derived from them. For example, carcinogenic substances often require a ten to twenty year latency period to reveal their effects; only recently did scientists discover that vinyl chloride, used for year in the manufacture of plastics and as aerosol propellant, is linked to a fatal liver cancer, angiosarcoma.

Environmentalists contend that although plaintiffs usually have the burden of proof, in suits challenging defendants' activities as serious public health hazards, where the probability of harm can not be determined with absolute certainty, public policy dictates that, upon a prima facie showing by plaintiffs, defendants should be held to show the safety of their products. Proponents of this view argue that such a modification of the usual burden rules is in keeping with a traditional justification for shifting the burden of proof: that the greater burden should be on the party with the greatest access to information.

The recent decision by a panel of the U.S. Court of Appeals for the Eighth Circuit in Reserve Mining Company v. United States,¹ staying the district court's order enjoining Reserve Mining's operations on Lake Superior, and finding that the plaintiffs had failed to show a demonstrable hazard exists from the asbestos-like fibers contained in the discharges, represents a rejection of this public policy argument. The Reserve Mining Company has operated an iron ore recovery plant at Silver Bay, Minnesota on Lake Superior for 17 years. The plant processes taconite, a low grade iron ore, mined at the company's Babbit, Minnesota mine. The ore is crushed and the material rich in iron particles is separated out by magnets leaving a taconite waste product called tailings. An average of approximately 67,000 short tons of tailings are dumped daily into the Lake near the plant, a huge quantity when compared with the estimated 12,000 tons daily of solid materials that are deposited into the lake by natural erosion. For years company officials described the tailings as mere sand, a description accepted by groups who opposed the plant's operations because of the alluvial plain it has created and the great reduction in water clarity caused in a large area around the plant.Only several years ago was it first suggested that the particulate air pollution caused by Reserve and the minerals deposited in the lake were similar to a proven carcinogen, asbestos. Asbestos is a generic, commercial term for several hydrated silicates that on processing separate into fibers. Two groups of silicates, the serpentines (chrysotile) and the amphiboles (tremolite, crocidite, actinolite, anthrophyllite, and amosite) are used commercially as asbestos. In the district court's decision, announced on April 20, 1974 after eight and a half months of trial testimony, Judge Lord found that "in Reserve's discharge … there are fibers within the cummingtonite-grunerite range of fibrous amphiboles … that have the identical morphology, crystallography and chemistry as amosite asbestos, a known human carcinogen."

Research studies have shown that lung and gastrointestinal cancer, asbestosis, and mesothelioma are maladies associated with asbestos exposure. Both mesothelioma and asbestosis have no known causes other than breathing asbestos fibers in the air. The term mesothelioma refers to tumors found in either the abdominal cavity lining or the lung membranes. Asbestosis is a scarring of the lung tissue caused by asbestos inhalation. No studies have been done on the effect of ingestion of asbestos fibers through means other than inhalation. Although most victims of asbestos-related diseases are exposed directly through their occupations, one reported case of fatal mesothelioma involved a woman who was exposed by regularly washing the coveralls of her three daughters employed in an asbestos factory.And among those who are occupationally exposed 45 percent die of lung and stomach cancer as opposed to the 15 to 20 percent in the general population who die of cancer.

Although no existing asbestos-related diseases could be directly traced to Reserve Mining's dumping of tailings into Lake Superior, Judge Lord of the District Court found that due to the similarities of the discharges to asbestos, and to the huge quantities of the material released into the air and drinking water supplies of communities bordering on the Lake, an injunction of Reserve's operations was warranted. Defendants had argued that the unemployment of Reserve workers that would be caused by a shutdown outweighed whatever health risk was involved. The District Court, in its memorandum supplemental to the decision announced April 20, 1974, responded that Reserve could use the work force to help perform the construction necessary to implement an on-land disposal system for the tailings and that because Reserve was economically capable of abating the health risk, it was using the employees as "hostage." The court stated that Reserve was refusing to abate the discharges because of the profitability of the existing [4 ELR 10114] operation (estimated at a 90 percent return on original equity invested per year). Concluding that profit could not be honored over human life, the district court indicated it had "no other choice but abate the discharge."

A panel of the Eighth Circuit Court of Appeals stayed Judge Lord's order two days after the plant was closed. The decision granted a 70 day stay conditioned upon action by Reserve to prepare a plan for abatement of its discharges. Although the opinion dealt with the narrow issue of granting a temporary stay pending a decision on the appeal of the district court's order taken by Reserve, because one criteria for granting such a stay is a determination of the moving party's likelihood of prevailing on appeal, the Eighth Circuit ruling portends further extended delays in abatement of Reserve's discharges.

The basis of the Court of Appeals decision was a finding that plaintiffs "failed to prove that a demonstrable health hazard exists." The appeals court criticized Judge Lord's "position that all uncertainties should be resolved in favor of health safety," finding that such a policy judgment should be made by the legislature rather than by the judiciary. Rejecting the evidence on health hazards as insufficient, the appeals court specified that the circumstances of exposure to fibers from Reserve's discharges were not comparable to those in the occupational context. The court found that principles extrapolated from present knowledge of occupationally related asbestos pathology could not be applied to the Reserve situation because neither the level of exposure attributable to Reserve nor the minimum safe level (if such exists) were determinable. The court also relied upon a tissue study performed at the request of the lower court that discovered no fibers present in autopsied persons who for 15 years prior to death had ingested water drawn from the lake. Essentially, the appeals court drew from the record of expert testimony those factual assertions which could be construed against the plaintiffs and established them as a basis for granting a stay. A reading of the supplemental memorandum filed in the case by the district court reveals that many arguments could be made against relying on the tissue study and that considerable evidence exists from which a significant health hazard could be inferred.

Plaintiff's contention that the appeals court panel applied an incorrect standard for review, contained in their petition for a rehearing en banc by the full Eighth Circuit, would seem to be correct. As indicated in Beverly v. United States, the accepted standard for review of a trial court's denial of a stay pending appeal "is whether or not the trial court abused its sound discretion…"² The appeals court neither found nor discussed any such abuse of discretion by the trial court but rather reviewed, as if de novo, the factual findings and the merits of the case. Rule 52 of the Federal Rules of Civil Procedure states that findings of fact shall not be set aside unless they are clearly erroneous. The Eighth Circuit had previously ruled that trial court conclusions shall not be set aside unless there is no substantial evidence to support them, they are against the clear weight of the evidence or they were induced by an erroneous view of the law.³ The Supreme Court, in Zenith Corporation v. Hazeltine, stated that "[i]n applying the clearly erroneous standard to the findings of a district court sitting without a jury, appellate courts must constantly have in mind that their function is not to decide factual issues de novo.'⁴ It would appear that the Eighth Circuit panel ignored these prior statements of the proper standard for review: the court did not even raise the issue of what standard was appropriate, but rather expressed an opinion as to which testimony was to be given weight, concluding that the trial court's findings were in error.

The question left unanswered by the appeals court in Reserve is what degree of proof will warrant immediate abatement of health hazards. The court stated that "unknowns may not be substituted for proof of a demonstrable hazard to the public health." The court here made a semantic distinction that if carried to its logical end yields absurd conclusions. The term "demonstrable hazard" could not mean that plaintiffs need show a direct correlation between Reserve's discharges and already existing human pathologies. Whereas social and behavioral scientists may await a highly significant correlation of variables before proclaiming a known relation between phenomena, such a standard would result in tragedy if applied in the medical and health sciences. Just as courts have required disclosure by medical personnel of all but trivial risks attendant to medical and surgical procedures in order to find "informed consent" so should the appeals court in Reserve Mining have given weight to the possibility of harm demonstrated by plaintiffs and found significant by the trial court. The well settled judicial doctrine in torts cases, that where the harm possible is extremely great it is reasonable to expect a higher standard of care, would seem appropriate for reference here. Testimony on the trial level in the Reserve case indicated that large quantities of amphibole fibers were present in both the air breathed and water consumed by the residents of the Lake communities. The possibility of harm to this public if the fibers are carcinogenic, as is believed by the state and federal agencies and other plaintiffs involved, is enormous. Does a "demonstrable hazard" mean that some number of residents must die of asbestos related diseases before the court will find that sufficient risk exists to warrant immediate abatement? Several other courts dealing with possible hazardous substances have clearly rejected such a high burden.

[4 ELR 10115]

The court in Bell v. Goddard⁵ affirmed the order of the Federal Food and Drug Administration withdrawing approval of diethylstilbestrol (DES) for use in producing caponette poultry. As is the case for the fibers discharged by Reserve, no known threshold or safe level existed for DES as a cause of cancer. Further, as found by the appeals court in Reserve, no methodology existed to establish such a level. Although there was considerable disagreement as to the hazards of DES, the FDA, pursuant to the mandate of the "Delaney Clause"⁶ of the Federal Food and Drug Act, withdrew approval of the drug. The Seventh Circuit stated "… this conflict in testimony does not mean that the Commissioner's ultimate finding that the petitioner's drug was not safe is without substantial evidentiary support."

The "Delaney Clause" applies only to food additives but the reasons justifying its enactment are applicable to the Reserve situation. In Environmental Defense Fund v. Ruckelshaus, which dealt with the cancellation of DDT registration under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA),⁷ the D.C. Circuit stated that the "Delaney Clause" does not govern agricultural use of DDT, as is of course true for Reserve's discharges, but that the clause does "indicate the magnitude of Congressional concern about the hazards created by carcinogenic chemicals…."⁸ The court indicated that Congress, in enacting FIFRA, sought to shift to the manufacturer the burden of proving the safety of his product, finding ample justification for such a view in the congressional history. For example, the court quoted from the remarks of Congresswoman Sullivan, "[T]he burden of proof should not rest on the Government, because great damage can be done during the period the Government is developing the data necessary to remove a product…."⁹ The court remanded the case to the Administrator of EPA (to whom such authority had been transferred), with instructions to issue cancellation notices of DDT, concluding that "… courts are increasingly asked to review administrative action that touches on fundamental personal interests in life, health and liberty…." and that "[t]hese interests have always had a special claim to judicial protection, in comparison to the economic interests at stake…."

Many other examples of the use of burden of proof rules to express legislative and judicial policy exist; the scope of this comment precludes mention of but a few. Courts have established practically irrebuttable presumptions of legitimacy of children born to married couples, justifying such as a proper recognition of public policy. In cases involving compensation under the Federal Employment Liability Act courts strain to find a prima facie case of compensable injury, allowing a scintilla to be enough to submit to a jury. Given such a legislative and judicial background the appeals court in Reserve Mining should have accepted the trial court's finding of a significant hazard. Burden of proof rules should properly force persons profiting from an activity to justify it where a prima facie case of a health hazard is made out. Judge Lord of the district court indicated he was "asked to permit the present discharge until such a time as it can be established that it has actually resulted in death to a statistically significant number of people." His response was that the "sanctity of human life is of too great a value to this court to permit such a thing." One must conclude that the panel of the Eighth Circuit that stayed Judge Lord's injunction has a different set of priorities.

As of this writing the Environmental Protection Agency had requested the Department of Justice either to petition the full Eighth Circuit for a rehearing en banc or to seek a reinstatement of the district court's denial of a stay pending appeal by petition to the Justice for the Eighth Circuit, Justice Blackmun. The Department of Justice declined on tactical grounds to do so, indicating that a grant of relief by either the full circuit court or the Justice would be very unlikely. The other plaintiffs in the case, including the states of Minnesota, Wisconsin, and Michigan, and the environmental groups involved, have petitioned for a rehearing en banc by the Eighth Circuit, and have indicated their intention to carry thestay issue to the Supreme Court if necessary. Regardless of these interlocutory efforts, the appeals court stay requires the district court to review Reserve Mining's plans for abatement and make a recommendation to the appeals court as to whether the stay should be continued when the 70 day period specified elapses. Thus, the Eighth Circuit panel at the end of the 70 days must decide again whether Reserve's discharges need be abated immediately.And after that decision, the merits of Reserve's appeal of the injunction must be briefed and argued. The future of the case is uncertain, and the procedural history grows more and more complex. Reserve's counsel, on questioning by the appeals panel, advised the court that as long as five years may be necessary for the company to convert to an on-land disposal system; if the district court's injunction is not reinstated during that time, it can at least be said that, because Reserve's discharges will have existed for a period as long as the latency periods for some cancers, perhaps the appeals panel can be shown the evidence it intimated is necessary.

1. 4 ELR 20598 (June 4, 1974).

2. 468 F.2d 732, 740, n. 13 (5th Cir. 1972).

3. City of West Plains, Missouri v. Loomis, 279 F.2d 564 (8th Cir. 1960).

4. 395 U.S. 100, 123 (1969).

5. 366 F.2d 177 (7th Cir. 1966).

6. 21 U.S.C. § 348(c) (3) (A).

7. 7 U.S.C. § 135 et seq.

8. 1 ELR 20059, 20063, n. 41 (D.C. Cir. 1971).

9. Supra, at 20062, n. 34.