Environmental -- 2017

Orange Cty. Water Dist. v. Sabic Innovative Plastics US, LLC   (California Supreme Court)

Erroneous expansion of California Superfund liability

For over three-and a-half decades since the Hazardous Substance Account Act (“HSAA”) was enacted, California businesses have been able to rely on state agency direction and expertise in remediating contaminated sites with the goal of eventually obtaining “No Further Action” letters signifying that their sites are safe for productive economic use and that, in all but the exceedingly rare case, they will not face liability for additional remediation. The Court of Appeal’s decision below destroys this cooperative relationship between businesses and expert government regulators and creates perverse incentives contrary to their shared interests. Under the Court of Appeal’s decision and two related decisions from the same court, private parties have now been granted a private right of action to seek to impose liability for remediation irrespective of prior remediation and regulatory action.

The NAM filed an amicus letter supporting review of this erroneous decision because both individually and collectively, these new rules adopted by the Court of Appeal undermine businesses’ and regulators’ cooperative partnership to address contamination on their sites by discouraging both voluntary remediation and swift compliance with regulators’ Remedial Action Plans. As a result, remediation may not commence, if at all, for years or decades following a site’s initial contamination, thereby preventing effective cleanup. And where cooperative remediation does occur, the efforts of businesses and government regulators may be second-guessed and undone by subsequent private litigation that can occur many years after the fact. Unfortunately, the California Supreme Court denied review of this important case.

Related Documents:
NAM amicus letter  (October 13, 2017)


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