Standing for Bringing RCRA Citizen Suit Determined at Time Case is Filed

In American International Specialty Lines Insurance Co. v. 7-Eleven,[1] the Northern District of Texas held that a showing of imminent and substantial endangerment to human health or the environment at the time litigation is commenced is sufficient to sustain a claim under the Resource Conservation and Recovery Act (“RCRA”).[2] 42 U.S.C. § 6972(a)(1)(B). Under the ruling, a defendant may not rely on subsequent clean up efforts as a means of avoiding suit.

Background

American International arose out of a dispute over environmental contamination at two former gas stations. American International Specialty Lines Insurance Company (“AISLIC”) insured the owners of a former Diamond Shamrock gas station located at 500 Boyd Road in Azle, Texas (the “500 Property”). The defendant, 7-Eleven, Inc. (“7-Eleven”), operated a gas station on adjacent property.

In 2004, AISLIC began remediation of the 500 Property under the direction of the Texas Commission on Environmental Quality (“TCEQ”). AISLIC’s investigation revealed that some of the contamination at the 500 Property had migrated through the groundwater from 7-Eleven’s parcel.[3] Armed with this information, AISLIC brought a RCRA claim against 7-Eleven, seeking injunctive relief to force 7-Eleven to remediate the contamination, as well as recovery of its attorneys’ fees and costs. AISLIC also sought recovery of its response costs under the Texas Sold Waste Disposal Act (“TSWDA”).[4]

More than a year later, AISLIC moved for summary judgment on its RCRA claim. In response, 7-Eleven filed a cross-motion for summary judgment, disputing that an imminent and substantial endangerment continued to exist at the site. 7-Eleven pointed to a report from AISLIC’s own consultant, Titan Engineering, which suggested that no imminent and substantial endangerment currently existed. The Titan report stated that any remaining contamination at the site would “not affect groundwater quality, would not likely pose a risk to human health, and would have little future impact on the immediate environment.”[5] Based on the report, TCEQ approved the cleanup process advocated by Titan in the report. Pointing to TCEQ’s decision, 7-Eleven argued that that there was no imminent and substantial threat to human health or the environment at the 500 Property and that AISLIC’s RCRA claim must therefore be dismissed based on the lack of a current imminent and substantial threat.

AISLIC responded that the site conditions which existed after it filed its lawsuit were irrelevant; maintaining that the court should look to the environmental conditions at the time the suit was filed to determine whether an imminent and substantial endangerment existed. AISLIC also argued that 7-Eleven should not benefit from remediation actions undertaken by AISLIC and that any improved site conditions at the 500 Property were due to its cleanup efforts, not those of 7-Eleven. AISLIC pointed to groundwater sampling showing benzene and MTBE[6] concentrations above state cleanup levels near the time it filed suit as support for its contention that an imminent and substantial endangerment existed at the time suit was filed.[7]

Analysis

RCRA’s citizen-suit provision provides a mechanism for private enforcement and recovery of attorneys’ fees to a prevailing party under the statute.[8] To prevail under § 6972(a)(1)(B), the plaintiff must show three things: (1) that the defendant is a “person” as defined by the statute; (2) that the defendant has contributed to or is contributing to the handling, storage, treatment, transportation, or disposal of any solid or hazardous waste; and (3) that the waste poses an imminent and substantial endangerment to human health or the environment.[9]

In American International, the court held that AISLIC had satisfied the first and second elements, but that there was a genuine issue of material fact with respect to the existence of an imminent and substantial threat. 7-Eleven had admitted it owned and operated underground petroleum-storage tanks at the 7-Eleven Property[10] and 7-Eleven’s releases of petroleum products contributed to the hazardous wastes found at both the 7-Eleven and 500 Properties.[11] As a result, the only remaining issue was whether an ongoing “imminent and substantial” threat was necessary in order for AISLIC to maintain its action, or whether it could rely on the existence of such a threat at the time it initiated the litigation.

In reviewing this question, the court noted that § 6972(a)(1)(B) provides for injunctive relief based on either past or present conduct. The court rejected 7-Eleven’s argument regarding the lack of a continued presence of waste at the site, explaining that it considered the relevant inquiry to be “whether the condition at the 500 Property posed a substantial danger on May 12, 2008, when this suit was filed.”[12] The court disagreed with 7-Eleven’s attempt to point to only the subsequent levels of contamination, stating, “Defendant misses the mark by citing almost exclusively to contamination levels in early 2009.”[13]

The court pointed out that contamination at the 500 Property exceeded the Texas state cleanup levels shortly before the suit was filed and that that petroleum soil contamination at 7-Eleven’s Property might continue to impact the 500 Property by means of groundwater migration. From this evidence, the court concluded that “it appears that there were elevated levels of potentially hazardous contaminants at the 500 Property at the time of suit.”[14]

Notwithstanding these conclusions and its rejection of 7-Eleven’s position, the court declined to grant summary judgment for AISLIC. The court held that issues of material fact precluded entry of summary judgment regarding whether contamination at the 500 Property actually constituted an imminent and substantial threat to human health and the environment at the time AISLIC filed suit. In reaching its decision, the court relied on precedent holding that contamination in excess of state limits was sufficient, by itself, to create a genuine issue of material fact as to the imminent threat element.[15]

Conclusion

Under American International, a defendant faced with a RCRA imminent and substantial endangerment citizen suit may not avoid liability by relying on environmental clean up undertaken after a plaintiff files the suit. The ruling may make it easier for plaintiffs to demonstrate an imminent and substantial endangerment at sites where clean up is ongoing.

For more information regarding American International, please contact Russell Prugh or any member of Marten Law’s Waste Cleanup practice.