This post was authored by summer associate Reilly Wright

In United States v. ERR, LLC, No. 21-30028 (5^th Cir. May 26, 2022), the Fifth Circuit ruled that the Seventh Amendment guarantees the right to a jury trial for defendants facing subrogation and recoupment claims under the Oil Pollution Act of 1990 (the “OPA”).  In 2015, ERR was found responsible for an oil spill originating from a wastewater treatment center that it owned and operated on the banks of the Mississippi River.  In 2017, the United States sued ERR under the OPA for removal costs it had paid from the Oil Spill Liability Trust Fund (the “Fund”) to Oil Mop LLC, a spill-response service provider.  ERR demanded a jury trial, which the district court denied, finding that the relief provided for in the OPA was in the nature of equitable restitution, so its claims sounded in equity, not in law.  However, the Fifth Circuit overturned that decision, holding that such claims were legal in nature and therefore provide ERR the right to a jury trial. Read More »

Share | Email| Comments|  Topics: Clean Water Act, Cleanup, Cost Recovery, Fifth Circuit, Oil Pollution Act, Response Action Contractors

Relying on Texas caselaw, the Fifth Circuit, in Gao v. Blue Ridge Landfill TX, L.P., No. 19-40062 (5^th Cir. Oct. 30, 2019), affirmed a district court decision which held that homeowners who moved near a preexisting landfill were subject to a two-year statute of limitations to bring suit based on odors emanating from the landfill. The case, while reliant on state law, nonetheless suggests that such claims that sound in nuisance need to be brought quickly, and that even a change in operations or uptick in odor complaints may be insufficient to reset the clock on the viability of claims. Read More »

Share | Email| Comments|  Topics: Air, Fifth Circuit, Landfill, Nuisance, Odors, Statute of Limitations, Texas, Waste

Late last month the Supreme Court of the United States kept alive private landowners’ challenge to a final rule that designated their land as “critical habitat” for the endangered Dusky Gopher Frog. Weyerhaeuser Co. v. U.S. Fish & Wildlife Serv., No. 17-71, 2018 WL 6174253 at *6 (2018) (slip opn.). The U.S. Fish and Wildlife Service designated the 1544-acre parcel in Louisiana—known as “Unit 1”—after it found the site “essential for the conservation of the species.” Id. The District Court and Fifth Circuit Court of Appeals deferred to the Service’s conclusion and upheld the designation. Id. The Supreme Court vacated and remanded. Id. at *7–8, 10. Focusing on the text of the Endangered Species Act, the Court held that: (1) a proposed site must be “habitat” for an endangered species before the Service can designate it as “habitat that is critical,” and (2) federal courts should review for an abuse of discretion the Service’s decision not to exclude a site from designation. Id. Read More »

Share | Email| Comments|  Topics: Chevron Deference, Endangered Species Act, Fifth Circuit, United States Supreme Court

The Eleventh Amendment to the United States Constitution preserves the doctrine of sovereign immunity, which shields state governments and their agencies from federal litigation that seeks money damages or equitable relief.  In general, a state government can only be sued if sovereign immunity is expressly waived by statute.  For example, nearly every state and the federal government have enacted a “torts claims act” that abrogates sovereign immunity for certain claims based on the negligence of government employees, and states that accept federal funding are also not immune from federal discrimination suits.  Where no waiver exists, the doctrine of sovereign immunity is broad and provides a shield to environmental suits, including claims under the federal Comprehensive, Environmental, Response, Compensation, and Liability Act (“CERCLA”), as the Fifth Circuit recently affirmed in United States Oil Recovery Site Potentially Responsible Parties Group v. Railroad Comm’n of Texas, et al., Dkt. No. 17-20361, __ F. 3d __, (5th Cir., Aug. 1, 2018).  Read More »

Share | Email| Comments|  Topics: CERCLA, Cleanup, Contamination, Contribution, Cost Recovery, Eleventh Amendment, Fifth Circuit, Sovereign Immunity, Superfund, Texas

Last month, in U.S. v. CITGO Petro. Corp., 711 Fed. Appx. 237 (5th Cir. 2017), the United States Court of Appeals for the Fifth Circuit affirmed an $81 million civil penalty assessment under the federal Clean Water Act (“CWA”) against CITGO Petroleum Corp. (“CITGO”), for unpermitted wastewater discharges from its plant in Lake Charles, Louisiana when a severe rainstorm caused two storage tanks to fail and over 2 million gallons of oil to be discharged into local waterways.  In the underlying case before the United States District Court for the Western District of Louisiana, CITGO conceded liability, and therefore, the only issue for trial was the total penalty to be assessed.  After a two-week bench trial, the District Court determined that CITGO had failed to properly maintain its wastewater storage tanks and allowed sludge and waste oil to accumulate in the tanks, which lessened their total storage capacity and ability to withstand a storm surge.  The District Court ultimately assessed a $6 million civil penalty against CITGO, which EPA appealed.  Read More »

Share | Email| Comments|  Topics: Civil Penalties, Clean Water Act, Cleanup, Contamination, EPA, Fifth Circuit, Louisiana, Storage Tank, Stormwater, Water

Is a leaking pipeline indicative of an operator’s failed attempt to consider all relevant risk factors when the pipeline has had leaks in the past? In the context of pipeline integrity management regulations, the Court of Appeals of the Fifth Circuit said no.  On August 14, 2017, the Court vacated, in part, a final order issued by the Pipeline Hazardous Materials Safety Administration (“PHMSA”) to ExxonMobil Pipeline Company (“ExxonMobil”), which found that ExxonMobil failed to properly consider the susceptibility of certain portions of its Pegasus Pipeline to seam failure and assessed a civil penalty of $2.6 million.  The opinion in ExxonMobil Pipeline Company v. United States DOT determined that, despite an oil leak from its Pegasus Pipeline, ExxonMobil was not in violation of PHMSA regulations requiring it to consider all risk factors that reflected the risk conditions on a certain pipeline segment because ExxonMobil “carefully [underwent] an informed decision-making process in good faith, reasonably taking into account all relevant risk factors in reaching a decision” that the pipeline was not at risk of seam failure.  2017 U.S. App. LEXIS 15144 (Aug. 14, 2017). Read More »

Share | Email| Comments|  Topics: Civil Penalties, Drilling, Energy, Fifth Circuit, Oil and Gas, PHMSA, Pipeline Hazardous Materials Safety Administration, Pipelines

An issue that insurers and industry have grappled with is whether a company can obtain environmental insurance coverage for costs to address violations of the Clean Air Act, when the costs at issue are aimed at curbing future air emissions, rather than remediating emissions that have already occurred.  Last week, one federal judge in Louisiana answered that question in the affirmative in La Gen Louisiana Gen. LLC, et al. v. Illinois Union Ins. Co., Dkt. No. 3:10-cv-00516 (M.D. La., Aug. 5, 2015).  Read More »

Share | Email| Comments|  Topics: Air, Cases to Watch, CERCLA, Clean Air Act, Decisions of Note, Defense Costs, Electric, Emissions, Energy, Enforcement Action, EPA, Fifth Circuit, Indemnification, Insurance, Insurance Coverage, Louisiana, Remediation