In Rio Linda Elverta Cmty. Water Dist. v. United States, No. 2:17-CV-01349, 2022 WL 3567143 (E.D. Cal. Aug. 18, 2022), the Honorable Kimberly J. Mueller, Chief Judge for the United States District Court for the Eastern District of California, dismissed  two California water utilities’ federal and state law claims against the federal government and several private sector defendants relating to hexavalent chromium (“Cr6”) pollution at the former McClellan Air Force Base (“Base”) near Sacramento, California.  The water utilities allege that during active operations of the Base, the federal government used products containing Cr6, which contaminated the groundwater aquifer from which the water utilities derive municipal drinking water, making it unsafe for human consumption.  Much of the case turned on the interplay between CERCLA sections 104 and 113(h) in the context of a clean up of a federal facility.

The federal government began to remediate environmental conditions at the Base in 1979, and those efforts are continuing to this day.  The water utilities acknowledge that such remediation efforts are taking place but insist that the government’s cleanup plan is not designed or intended to address the off-Base contamination, which is affecting individuals such as the water utilities and their customers.  The private sector defendants include manufacturers and distributers of industrial products containing Cr6 which were sold to the federal government for use at the Base during active operations.

In their respective complaints, the water utilities accuse the federal government of negligence, nuisance, trespass, and utility tampering in violation of California Civil Code § 1882, in addition to seeking cost recovery under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), 42 U.S.C. § 9607(a) and an imminent and substantial endangerment finding under the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C. § 6972(a)(1)(B).  As to the private sector defendants, the water utilities allege negligence, nuisance, trespass, strict liability based upon design defects and failure to warn, and utility tampering in violation of California Civil Code § 1882.

Prior to Judge Mueller’s ruling, the federal government moved to dismiss all claims against it, and the private sector defendants moved to dismiss the nuisance, trespass, and utility tampering claims against them.

As to the water utilities’ RCRA claim, the federal government argued that its ongoing CERCLA § 104 cleanup of the Base cannot be subject to a pre-enforcement challenge because of the jurisdictional bar to such claims found in § 113(h).  Judge Mueller analyzed Ninth Circuit precedent and concluded that the resolution of this jurisdictional question turned on the answer to two questions. “First, is the McClellan cleanup a removal action under § 104?  If it is, the court must proceed to the second question: are the plaintiffs’ claims ‘challenging’ the cleanup.  If the answer to both questions is yes, then the jurisdictional bar of [CERCLA] § 113 applies.”  Rio Linda Elverta Cmty. Water Dist. at * 3 (internal citations omitted) (citing Razore v. Tulalip Tribes of Washington, 66 F.3d 236, 239 (9th Cir. 1995)).

As to the first question, Judge Mueller emphasized that CERCLA distinguishes between removal actions on federal property, which are carried out under § 104, and remedial actions on federal property, which are carried out under § 120. Id. at * 3.  The former “are designed to effect an interim solution to a contamination problem” while the latter “are designed to effect a permanent solution.”  Id. (citing Price v. U.S. Navy, 39 F.3d 1011, 1016 (9th Cir. 1994)).  The jurisdictional bar found in § 113 applies only to removal actions under § 104 and not to remedial actions under § 120, which uniquely concerns federal facilities.  Id. (citing Fort Ord Toxics Project, Inc. v. California Environmental Protection Agency et al., 189 F.3d 828, 834 (9th Cir. 1999) (finding that § 120 confers a separate grant of authority for remedial cleanups of federal government owned property and that challenges of those cleanups do not fall under the jurisdictional bar in § 113)).    

The parties do not dispute that the federal government is conducting both remedial and removal actions at the Base.  However, Judge Mueller  concluded that the water utilities’ claims against the federal government target its removal action activity only, and that “the mere conduct of remedial actions at the site . . . [does not] mean[] the court must find that § 113’s jurisdictional bar does not apply.”  Id. at * 4.  Accordingly, Judge Mueller determined that the water utilities’ RCRA claim was directed at the § 104 cleanup.

Turning to the second question, Judge Mueller determined that the water utilities’ claims were challenges of the § 104 cleanup because they seek to improve upon the actions that the federal government is already taking at the Base pursuant to that provision.  Thus, Judge Mueller dismissed the water utilities’ RCRA claim for lack of subject matter jurisdiction.  

Next, Judge Mueller analyzed the water utilities’ state law claims against the federal government and found that they were barred by sovereign immunity.  Under the doctrine of sovereign immunity, the federal government, as sovereign, must consent to suit.  The Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2674, provides that “the United States shall be liable, respecting the provisions of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances . . .”  However, under the discretionary function exception, the federal government “may not be liable for acts grounded in public policy considerations that involve an element of judgment.”  Id. at * 5 (citing United States v. Gaubert, 499 U.S. 315, 322-23 (1991)).

First, the federal government successfully argued that the utility tampering claim did not come within the scope of the FTCA waiver because it is a strict liability offense.  Second, the federal government argued that negligence, nuisance and trespass all come within the discretionary function exception in the context of the Base cleanup.  Under the two-part discretionary function test, laid out in Gaubert, courts look first to whether the act was “governed by a mandatory statute, policy, or regulation” and second to whether the act “involves a decision susceptible to social, economic, or political policy analysis.”  Id. at * 6 (citations omitted).  Applying the Gaubert test and Ninth Circuit precedent, Judge Mueller decided that the discretionary function exception applied to the water utilities’ remaining state law claims against the federal government because those claims were challenging the design of the Base’s waste disposal system, which was not governed by a mandatory statute, policy, or regulation, and which implicated significant political policy analysis.  Id. at ** 6-7.

As to the private sector defendants, Judge Mueller determined that the water utilities failed to make out prima facie nuisance, trespass, and utility tampering claims because they were not supported by sufficient factual allegations that the private sector defendants affirmatively engaged in conduct comprising those claims.  Accordingly, Judge Mueller dismissed those claims without prejudice, giving the water utilities the opportunity to plead additional facts to support same.

Finally, the federal government attempted to argue that the water utilities’ CERCLA § 107(a) cost recovery claim should be dismissed because they allegedly failed to adequately plead that the costs they incurred to reduce the levels of Cr6 in their wells were necessary or that any of the requirements for consistency with the National Contingency Plan (“NCP”) were met in that process.  Under CERCLA § 107(a), a plaintiff must show that “the property at issue is a ‘facility’; a ‘release’ or ‘threatened release’ of a ‘hazardous substance’ has occurred; the ‘release’ or ‘threatened release’ has caused the plaintiff to incur response costs that were ‘necessary’ and ‘consistent with the [NCP]’; and the defendants are . . . subject to liability [therefor.]”  Judge Mueller ultimately declined to dismiss the water utilities’ CERCLA § 107(a) cost recovery claim because the water utilities “sufficiently alleged their costs were necessary [when they asserted] the concentration of Cr6 in their wells posed a health hazard if left untreated” and “the question of whether a response action is necessary and consistent with the criteria set forth in the [NCP] is a factual one to be determined at the damages stage of a [CERCLA §] 107(a) action.” Id. at *11.

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