National Tanks ConferenceNational Tanks ConferenceBoston, MA Sept. 20-22, 2010

Presented by: Jill Elise GrantNordhaus Law Firm LLPNordhaus Law Firm, LLP1401 K Street, NW, Suite 801Washington, DC 20005 Email: jgrant@nordhauslaw.com

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Navajo Nation issues lease to Sybil Baldwin in 1955, to own and operate a gas stationp g

Lease reissued several times, most recently in 1995 for 50 years, to operate gas station/convenience store in exchange for % of gross receipts or minimum rentexchange for % of gross receipts or minimum rent

Baldwin subleased the property to Ed Flores to operate the station and convenience store, in exchange for percentage of gross receipts or minimum rentpercentage of gross receipts or minimum rent

Baldwin lease is transferred to Baldwin children by Navajo family court in 2001

Sybil Baldwin dies in 2002

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The 3 USTs at issue were installed by Baldwin sometime from 1985-1988

9/19/97 – EPA & NNEPA inspect station, note noncompliance issues and suspect leaks from tanks 1 and 2 based on inventory control records

11/27/97 – Tank 3 emptied due to failing tightness test and 11/27/97 – Tank 3 emptied due to failing tightness test and put in temporary closure

12/12/98 – More noncompliance issues 2/15/99 – Tank 2 put in temporary closure 5/22/99 – Tank 1 upgraded 2000-2004 – more notices of noncompliance, need to put

USTs in permanent closure or remove 6/10/04 All 3 tanks pulled; evidence of releases; remedial 6/10/04 – All 3 tanks pulled; evidence of releases; remedial

action taken by Riedel during next few months 8/20/04 – Last inoculation of bioremediation chemicals 6/14/06 – EPA issues NFA letter

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2004/2005 - Flores contracts with Milam for ASTs to be installed and for renovations at sitebe installed and for renovations at site

March 2005 – ASTs installed, fuel delivered 3/21/05 – Fuel line pierced during renovations by

b t t (th F li )subcontractor (the Felixes) Sept. 2005 – Riedel repairs fuel line and begins

remediation 10/17/05 – Riedel reports release to NNEPA 6/25/07 – Flores reports to NNEPA that total spill was

15,633 gallons, that he filed claim against Felixes’ g ginsurer, that site still needs remediation

2/11/08 – Riedel performs initial site investigation for RedHawk (insurance co. contractor)( )

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1973: Lead phase-down to .1gram/gal. by 1976

1974-78: MMT (methylcyclopentadienylmanganese tricarbonyl) used as fuel additivemanganese tricarbonyl) used as fuel additive

Nov. 8, 1984: RCRA UST provisions enacted: if UST in use on or after this date “owner”if UST in use on or after this date, owner includes anyone who ever owned the UST

1996: Leaded gasoline banned under the gClean Air Act

Oct. 19, 1998: Navajo Nation UST Act passed

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US EPA regulates USTs under RCRA

NNEPA Regulates USTs under NNUSTA

Pic-N-Run Gas Station

Chinle, AZ

Navajo Nation Trust Land

Navajo Nation

landowner

Sybil Baldwin

Baldwin Brothers

lessees

Pic-N-Run, Inc.

Ed Flores

sublessees

Eldridges/Milam

contractors

Spencer Riedel/Service Station Equipment

UST removal & remediation

AST repair

Felixes/Shiprock Construction

subcontractors

Ohio Casualty Insurance Co.

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Tribal: Pic-N-Run, Inc. v. Milam Building Assoc., Inc., No CH-CV-359-07 (Nav Dist Ct Chinle) (ComplaintNo. CH CV 359 07 (Nav. Dist. Ct. Chinle) (Complaint filed August 1, 2007)◦ Common law claimsBaldwin v. Auto Owners Insurance Co., No. CH-CV-,333-09 (Nav. Dist. Ct. Chinle) (First Amended Complaint filed Oct. 9, 2009)◦ Claim against owner’s insuranceFederal Feli Pic N R n Inc No 3 09 c 8015 Federal: Felix v. Pic-N-Run, Inc., No. 3:09-cv-8015-JAT (D. Ariz.) (First Amended Complaint filed May 6,2009)

Administrative: In the Matter of Eldridge et al EPA Administrative: In the Matter of Eldridge, et al., EPA Docket No. RCRA 7003-09-2009-0002 (Issued August 27, 2009)

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Felixes sued PicNRun, Milam, Riedel, Baldwins, EPA, Navajo Nation and NNEPA under RCRA §7002Navajo Nation, and NNEPA under RCRA §7002

RCRA waives sovereign immunity for EPA and for tribe (Blue Legs, 8th Cir. 1989)

Suit brought under 7002(a)(1)(A) for violations of Suit brought under 7002(a)(1)(A) for violations of Parts 264 and 280 and under 7002(a)(1)(B) for contributing to ISE

Sought declaratory relief that all defendants solely or i ll li bl f d f dpartially liable for past and future response costs and

sought apportionment of costs Also sued all except EPA and NNEPA under Arizona

law and common lawlaw and common law Counterclaims and crossclaims asserted by

defendants, including against Navajo Nation

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Except as provided in subsection (b) or (c) of this section, any person may commence a civil action on his own behalf –(1)(A) against any person (including (a) the(1)(A) against any person (including (a) the United States . . .) who is alleged to be in violation of any permit, standardsviolation of any permit, standards regulations, condition, requirement, prohibition, or order which has become ffeffective pursuant to this chapter;

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(1)(B) against any person, including the United St t d i l di t tStates . . . , and including any past or present generator, past or present transporter, or past or present owner or operator of a p p ptreatment, storage, or disposal facility, who has contributed to or who is contributing to the past or present handling storagethe past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present

i i d b i l dan imminent and substantial endangerment to health or the environment;

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The district court shall have jurisdiction . . . to enforce the permit, standard, regulation, . . . or order referred to in paragraph (a)(1)(A), to restrain any person who has contributed orrestrain any person who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, g, g , , p ,or disposal of any solid or hazardous waste referred to in paragraph (a)(1)(B), to order

h t t k h th tisuch person to take such other action as may be necessary, or both. . . .

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Issued under RCRA § 7003 to PicNRun, Felixes, Milam Baldwins (not Riedel or NNEPA)Milam, Baldwins (not Riedel or NNEPA)

Found joint and several liability as contributors to handling, treatment, storage, transportation, and disposal of solid wastedisposal of solid waste

Found free gasoline in soil and groundwater, also benzene, MTBE, lead, and MMT

Requires continuation of interim remedial Requires continuation of interim remedial measure begun by RedHawk: SVE system to remove free product

Requires PicNRun to implement remediation and Requires PicNRun to implement remediation and others to “participate, cooperate, and coordinate”

Penalty for failure to comply of up to $7500/day

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(a) Authority of Administrator Notwithstanding any other provision of this chapter, uponNotwithstanding any other provision of this chapter, upon receipt of evidence that the past or present handling, storage, treatment, transportation or disposal of any solid waste or hazardous waste may present an imminent and substantial endangerment to health or the environment, the Administrator gmay bring suit on behalf of the United States in the appropriate district court against any person (including any past or present generator, past or present transporter, or past or present owner or operator of a treatment, storage, or disposal facility) who has

t ib t d h i t ib ti t h h dli tcontributed or who is contributing to such handling, storage, treatment, transportation or disposal to restrain such person from such handling, storage, treatment, transportation, or disposal, to order such person to take such other action as may be necessary or both The Administrator may also takebe necessary, or both. . . . The Administrator may also . . . take other action under this section including, but not limited to, issuing such orders as may be necessary to protect public health and the environment.

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Who is a Responsible Party? What requirements apply to the ASTs? Do any RCRA regulations apply in this case? When may a person bring a RCRA citizen suit? What relief is available under a RCRA citizen

suit?suit? What were EPA’s and NNEPA’s enforcement

options?options?

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Prior UST owner/operators Tribe as landowner Tribe as lessor collecting rent based on

ireceipts AST owner/operator Contractor/subcontractor for AST installation Contractor/subcontractor for AST installation Removal contractor for USTs Repairer of AST leak Repairer of AST leak EPA and NNEPA as regulators

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8. Improvements. . .Any hazardous materials or petroleum product manufacturing, processing, surface storage, underground storage tank system, or conveyance facilities placed on the leased land are the property of the Lessee who installed them, unless specifically stipulated to revert to the Lessor or another party . . . . Within a reasonable time frame, stipulated in the Lease, prior to vacation of the property the Lessee shall remove any of the above improvements assess theproperty the Lessee shall remove any of the above improvements, assess the site for potential contamination, remediate any contamination discovered, and address any third party damages which may have occurred, unless otherwise stipulated in the Lease. Should any of the above activities extend past the termination date of the Lease, the Lessee shall still be financially responsible for completing these activities and shall be required to post bond to ensurefor completing these activities, and shall be required to post bond to ensure that the activities are complete after termination of the Lease.

Page 5A, Proposed Improvements

To remove or seal the old gasoline tanks in accordance with the laws of the Navajo Nation Environmental Protection Administration Office. . . .

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1. DefinitionsC. “Hazardous Substances” means and includes but is not limited to . . . any

t l d t i l di d il f ti f it d t lpetroleum products, including crude oil or any fraction of it, and any natural gas liquids, synthetic gas and liquefied natural gas.

19. Hazardous SubstancesLessee shall not cause or permit any hazardous substance to be used, stored,Lessee shall not cause or permit any hazardous substance to be used, stored, generated or disposed of on or in the premises without first obtaining Lessor’swritten consent. If hazardous substances are used, stored, generated or disposed of on or in the premises except as permitted above, or if the premises become contaminated in any manner for which Lessee is legally liable, Lessee shall indemnify and hold harmless the Lessor from any and all claims, d fi j d l i li bili i l A i idamages, fines, judgments, penalties, costs, liabilities or losses . . . Arising during or after the Lease term and arising as a result of such contamination by Lessee. This indemnification includes, without limitation, any and all costs incurred due to any investigation of the site or any cleanup, removal or restoration mandated by the federal government or Navajo Nation. Without limitation of the foregoing if Lessee causes or permits the presence of anylimitation of the foregoing, if Lessee causes or permits the presence of any hazardous substance on the premises and such results in contamination, Lessee shall promptly, at its sole expense, take any and all necessary actions to return the premises to the condition existing prior to the presence of any such hazardous substance on the premises. Lessee shall first obtain Lessor’sapproval for any such remedial action.approval for any such remedial action.

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Regulators may be liable as contributors only if they actually contributed to the ISE, not solely by virtue of regulating/not regulating

E g Proffit v Davis 707 F Supp 182 (E D E.g. Proffit v. Davis, 707 F.Supp. 182 (E.D. Penn. 1989); Ringbolt Farms v. Town of Hull, 714 F.Supp. 1246 (D. Mass. 1989)714 F.Supp. 1246 (D. Mass. 1989)

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No requirements under RCRA SPCC regulations

0 C 2 ll d◦ 40 CFR Part 112 – spill prevention and response planning, not as comprehensive as UST regulations, not corrective action

Tribal law Leases

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Part 280◦ Past UST violations only if currently contributing to ISE

RCRA 7002( )(1)(A) i f t/f t d t◦ RCRA 7002(a)(1)(A) is for current/future endangerment, Gwaltney v. Chesapeake Bay Fdn, 484 U.S. 49 (1987)

Part 264◦ ASTs are not hazardous waste TSD facilities: not waste notASTs are not hazardous waste TSD facilities: not waste, not

TSD facility◦ Bioremediation of petroleum-contaminated soil is not

treatment facility, question if hazardous◦ § 261 4(b)(10) (petroleum contaminated media and debris◦ § 261.4(b)(10) (petroleum-contaminated media and debris

that do not meet certain toxicity characteristics and that are subject to corrective action regulations under Part 280 are solid waste, not hazardous waste)§ 264 1( )(8)(i) ifi ll t f P t 264 “◦ § 264.1(g)(8)(i) specifically exempts from Part 264 “a person engaged in treatment or containment activities during immediate response to any of the following situations: . . .(C) A discharge of a material which, when discharged becomes a ha ardo s aste ”discharged, becomes a hazardous waste.”

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RCRA § 7002(b)(2)(B)(iv): No citizen suit may be commenced under § 7002(a)(1)(B) if EPA has obtained a court order or issued an orderhas obtained a court order or issued an order under § 7003 under which a responsible party is conducting remedial actionparty is conducting remedial action

Case law: No pre-enforcement review of compliance order issued under RCRA § 7003

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RCRA citizen suit provides for declaratory and injunctive relief◦ Unlike CERCLA §113(f)(1), RCRA does not provide for contribution◦ No recovery of past cleanup costs, Meghrig v. KFC Western, 516 U.S. 479 (1996)◦Questionable recovery of future costs

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Which authority? Which authority?◦ USEPA or NNEPA EPA responsible for implementing RCRA in Indian country,

Wash. Dept. of Ecology v. EPA, 752 F.2d 1465 (9th Cir. 1985)◦ RCRA or Tribal law No TAS under RCRA, Backcountry Against Dumps, 100 F.3d

147 (D.C. Cir. 1996)L◦ Leases

What type of action?◦ USEPA judicial action◦ USEPA administrative action◦ RCRA citizen suit provision◦ Tribal court action

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Felixes voluntarily dismissed EPA and NNEPA Court dismissed Navajo Nation from suit for

lack of subject matter jurisdiction, because found improper pre enforcement review offound improper pre-enforcement review of EPA order

Court also dismissed all RCRA claims (but not Court also dismissed all RCRA claims (but not common law claims) against Riedel for same reason

Case is in discovery stage among remaining parties, trial anticipated for April 2011

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In the meantime, cleanup is progressing under the EPA Order

Warren Roan of NNEPA will provide you with an overview of the cleanup and then we’llan overview of the cleanup, and then we ll both be available for questions

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