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Government Enforcement Action May Not Bar RCRA Citizen Suits

May 25, 2011

The Seventh Circuit Court of Appeals held earlier this month that a government enforcement action brought by a state agency under authority delegated to it under the Resource Conservation and Recovery Act (RCRA) does not preclude a RCRA citizen suit alleging violations not specifically pled in the government’s complaint. Adkins v. VIM Recycling, Inc.[1] arose from alleged violations at a solid waste facility. The Seventh Circuit held that a state agency’s contemporaneous lawsuit against the same facility did not act as a bar to the citizen suit because the state enforcement action and citizen suit did not address the same alleged violations. Furthermore, the citizen’s claims were filed before the state filed its parallel claims.

The Seventh Circuit’s decision is consistent with the only other federal appellate court to address the issue. In 2009, the First Circuit permitted a RCRA citizen suit to proceed even though a government enforcement action was also proceeding.[2] In reaching its holding, the First Circuit relied on the fact that, even though the citizen suit and government enforcement actions overlapped, the citizen suit sought relief beyond that sought by the government. Lower courts have generally reached similar conclusions. [3]

I. Statutory Background

RCRA governs the treatment, storage, and disposal of solid and hazardous wastes. Most (but not all) states have been delegated the authority to implement RCRA at the state level.[4] RCRA provides for two types of citizen suits: “enforcement” suits and “endangerment” suits. An “enforcement” suit may be brought against private parties or government agencies allegedly “in violation of any permit, standard, regulation, condition, requirement, prohibition, or order which has become effective pursuant to this chapter.”[5] An “endangerment” suit may be brought against parties who allegedly have contributed to, or are contributing to, “the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment.”[6]

Prior to commencing an action, a plaintiff must (under most circumstances) provide notice to EPA, the State where the alleged violation occurred, and the alleged violator. “Enforcement” claims are subject to 60-day pre-suit notice, while “endangerment” claims are subject to 90-day pre-suit notice.[7] In addition, citizen suits are precluded if a federal or state agency has already “commenced and is diligently prosecuting” an action for the same alleged violation.[8]

II. Factual and Procedural Background

Adkins involved alleged RCRA violations at a solid waste operation in Elkhart, Indiana operated by VIM Recycling. The Indiana Department of Environmental Management (IDEM) classified the waste at VIM’s facility into three different grades: A (trees, brush, recently live wood, and uncontaminated lumber ground up to make mulch), B (wood scraps containing laminated wood and plywood ground up to make animal bedding), and C (formerly B waste that was no longer suitable for making animal bedding).[9] In 2007, VIM and IDEM entered into an Agreed Order that required VIM to: (1) obtain permits for its activities; (2) cease taking C-grade waste to non-permitted facilities; (3) cease putting unregulated waste on the berm at the VIM site; (4) conduct environmental sampling to ensure the site was not threatening human health or the environment; (5) cease putting any waste onto the C-grade piles; and (6) remove all C-grade waste by September 2008.

VIM allegedly failed to comply with the Agreed Order. In October 2008, IDEM filed a lawsuit in state court (the 1st IDEM Lawsuit) seeking to enforce the Agreed Order, particularly the requirement to remove all C-grade waste from the site. A number of Elkhart residents, who had long complained about VIM’s operations, sought to intervene in the 1st IDEM Lawsuit. The citizens also sought to expand the scope of the lawsuit beyond the scope of the Agreed Order, including a request to enjoin all unpermitted disposal of all solid waste (not just C-grade waste), and to compel VIM to remediate the site. The interveners also sought monetary damages under common law theories of trespass, nuisance, and negligence.

The state court ruled that the intervenors were not permitted to expand the scope of the proceeding beyond the claims brought by IDEM pursuant to the Agreed Order. The intervenors subsequently withdrew all of their claims outside the scope of the 2007 Agreed Order and filed a RCRA citizen suit seeking broader relief in federal district court, including claims relating to the handling and disposal of A-grade and B-grade waste. The plaintiffs’ claims included both “violation” and “endangerment” claims under RCRA, as well as state common law claims. Prior to initiating their citizen suit, the plaintiffs served notice on EPA, IDEM, and VIM. Neither EPA nor IDEM filed a lawsuit seeking the same relief prayed for in the citizen suit.

After the citizen suit had been filed, IDEM filed a second state-level lawsuit (the 2nd IDEM Lawsuit) alleging new solid waste violations, including claims analogous to those brought in the federal citizen suit pertaining to the handling and dumping of B-grade waste.

In the federal citizen suit, VIM sought to dismiss the plaintiffs’ claims, arguing that the court did not have subject matter jurisdiction because IDEM was pursuing the same claims in state court. VIM also argued that the federal court should abstain from exercising its jurisdiction based on the Supreme Court’s holdings in Burford v. Sun Oil Co.[10] and Colorado River Water Conservation District v. United States.[11] The district court agreed with VIM, dismissed plaintiffs’ RCRA claims, and declined to exercise supplemental jurisdiction over plaintiffs’ state law claims.

III. Discussion

A. Subject Matter Jurisdiction and Failure to State a Claim

On appeal, the Seventh Circuit first held that the “diligent prosecution” bar did not divest the district court of subject matter jurisdiction over the plaintiffs’ RCRA claims. The court observed that RCRA’s “diligent prosecution” bar did not “speak in jurisdictional terms or refer in any way to the jurisdiction of the district courts.” Thus, the plaintiffs had “alleged a colorable claim for relief directly under RCRA” even if the “diligent prosecution” bar might preclude a decision on the merits.

Second, the court went on to assess whether, in light of the “diligent prosecution” bar, plaintiffs’ had stated a claim upon which relief could be granted. The court held that the district court’s decision to bar the citizen suit based on the later-filed 2nd IDEM lawsuit was “contrary to the plain language of [RCRA].” The court relied on the fact that the citizens had filed their lawsuit concerning A-grade and B-grade waste before the 2nd IDEM Lawsuit (addressing the same subjects) was filed.

Looking to RCRA’s plain language, the court noted that the “diligent prosecution” bar only prohibited the commencement of a citizen suit, not the prosecution of an action that had already been filed:

The verb tenses make clear that subsection (b)(1)(B) bars a RCRA citizen suit for a RCRA violation only if the suit was “commenced” after the government “has commenced” a lawsuit, not if the citizen suit was filed first.

The court’s holding was consistent with its interpretation of identical language in the Clean Water Act’s citizen suit provisions in Friends of Milwaukee’s Rivers v. Milwaukee Metropolitan Sewerage District, where the court had held that a state enforcement action filed mere hours after a citizen suit did not the citizen suit.[12]

The court next evaluated whether the plaintiffs’ claims were barred by the 1st IDEM Lawsuit. The court held that it did not. Where the 1st IDEM Lawsuit sought to enforce terms of the 2007 Agreed Order concerning C-grade waste, the citizen suit was based on claims not included in the 1st IDEM Lawsuit, including claims pertaining to the handling of A-grade and B-grade waste. Thus, the court held that the plaintiffs’ claims were not precluded “to the extent that the plaintiffs’ claims do not overlap with those asserted in the [1st IDEM Lawsuit]. …”

B. Abstention

The court then addressed the district court’s decision to abstain from exercising its jurisdiction under the Colorado River and Buford abstention doctrines. Under Colorado River abstention, a federal court may defer to a “concurrent state proceeding” as a matter of “wise judicial administration.” Colorado River abstention is appropriate when “substantially the same parties are contemporaneously litigating substantially the same issues.” Precise formal symmetry is not required, but the claims must “involve the same parties, arise out of the same facts and raise similar factual and legal issues.”

The Seventh Circuit held that the 1st and 2nd IDEM Lawsuits and the citizen suit were not parallel for purposes of Colorado River abstention. The court first acknowledged that the plaintiffs were different - IDEM in the two state lawsuits, and citizens in the federal RCRA lawsuit. While the plaintiffs had a general alignment of interest, the court held that IDEM and the citizen plaintiffs could not be treated as if they were the same party. The court also held that the claims were different because allegations of the dumping of A-grade waste were only raised in the citizens suit. The court also observed that federal courts have exclusive jurisdiction over RCRA “endangerment” claims - therefore, such claims could not be brought by IDEM in their state court actions.

The Court next assessed the lawsuits under Buford abstention, which permits federal courts to abstain under two limited set of circumstances: first, when the court is faced with “difficult questions of state law” that implicate significant state policies; and second, when concurrent federal jurisdiction would “be disruptive of state efforts to establish a coherent policy with respect au matter of substantial public concern.”

The district court had ruled that the second basis for Buford abstention applied because it would be required to second-guess IDEM’s application of Indiana law. The Seventh Circuit disagreed, holding that “the mere existence of a statewide regulatory regime is not sufficient.” Instead, “judicial review by state courts with specialized expertise is a prerequisite to Buford abstention.” The court observed that environmental claims under Indiana law are brought in courts of general jurisdiction, as opposed to the specialized state courts that heard the railroad appeals at issue in Buford. Recognizing the narrow contours of Buford abstention the court concluded that:

[W]e recognize that the busy district court’s decision to abstain in this case was based on a healthy respect for state courts and a desire to avoid duplicating or interfering with their efforts … we believe the congressional policy choices reflected in the RCRA citizen-suit provisions remove the abstention options form the district court’s toolbox. The district court retains other tools for working smoothly with the state courts. There is no reason the federal and state judges cannot confer with one another and coordinate their management of the related cases, including discovery. Federal district court judges often need to make such efforts to coordinate with state trial judges when dealing with the complexities of multidistrict litigation … and when dealing with complex discovery and other coordination problems.

In conclusion, the Seventh Circuit held that the RCRA citizen suit should go forward (except for overlapping claims concerning C-grade waste), and remanded the matter back to the district court for further proceedings.

IV. Dissent

Circuit Judge Ripple concurred in part and dissented in part, specifically with respect to the majority’s “overly rigid” evaluation of Colorado River abstention. Judge Ripple first noted that the district court abused its discretion by dismissing, rather than staying, the federal citizen suit under the Colorado River abstention doctrine. In advocating that the exercise of Colorado River abstention was not an abuse of discretion, Judge Ripple noted that the state did not have an interest adverse to the citizen plaintiffs, and that “all of the federal and state actions involve the same plot of land, the same alleged activity and the removal of essentially the waste form that land.” Judge Ripple went on to observe that the primary source of law in both lawsuits would be state law - namely, Indiana’s Solid Waste Management Plan enacted pursuant to RCRA. The dissent further noted that the state proceedings were adequate to address all of the plaintiffs’ interests. Based on these facts, Judge Ripple concluded that:

[S]imultaneous litigation of the actions and simultaneous supervision of the remediating process by state and federal courts will be a recipe for delay, confusion and wasted judicial resources. These concerns were the precise motivations in Colorado River, and it is not clear how any of the plaintiffs’ interests are impaired if the federal case is stay.

For more information, please contact any member of Marten Law’s Waste Management practice group.

[1] --F.3d.--, 2011 WL 1642860 (7th Cir. May 3, 2011).

[2] Francisco Sanchez v. Esso Oil Co., 572 F.3d 1 (1st Cir. 2009). See also Dedham Waster Co. v. Cumberland Farms, Inc., 889 F.2d 1146 (1st Cir. 1989) (Citizen suit precluded by state enforcement lawsuit seeking same relief).

[3] E.g., Gilroy Canning Co. v. California Canners & Growers, 15 F. Supp. 2d 943 (N.D. Cal. 1998) (ruling that, under RCRA’s “diligent prosecution” bar, a state agency enforcement action under state law did not preclude a citizen suit seeking enforcement under RCRA in federal court); Glazer v. Am. Ecology Envtl. Services Corp., 894 F. Supp. 1029 (E.D. Tex. 1995) (“[When] a different RCRA permit, standard, regulation, condition, requirement, or order is in controversy in the citizen suit, or if a different activity constituting the alleged violation of the … RCRA permit, standard, regulation, condition, requirement, or order, the federal court has jurisdiction over the citizen suit.”); but see Hudson Riverkeeper Fund, Inc. v. Harbor at Hastings Associates, 917 F. Supp. 251 (S.D.N.Y. 1996) (ruling that under New York’s liberal pleading standards, a state agency enforcement action might include RCRA claims even if not expressly pled; therefore, a later-filed citizen suit should be precluded).

[4] 42 U.S.C. § 6943.

[5] 42 U.S.C. § 6972(a)(1)(A).

[6] 42 U.S.C. § 6972(a)(1)(B).

[7] 42 U.S.C. §§ 6972(b)(1) and (2).

[8] 42 U.S.C. §§ 6972(b)(1)(B) and (b)(2)(B)(i).

[9] IDEM’s waste designations were specific to the VIM site.

[10] 319 U.S. 315 (1943).

[11] 424 U.S. 800 (1976).

[12] 382 F.3d 743 (7th Cir. 2004).

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