The Environmental Backdrop

2. The Environmental Backdrop • In 1970s, perception that States not doing enough to clean up contaminated sites despite passage of Clean Water Act in 1972 • In 1980, U.S. Congress passed the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) • In addition to providing claims for the recovery of remediation costs, CERCLA provides basis for the recovery of natural resource damages (NRD)

3. Natural Resource Trustees • CERCLA permits NRD claims to be brought by Natural Resource Trustees • Trustees include: • Federal Government • Dept. of Interior/Fish & Wildlife (terrestrial resources) • Dept. of Commerce/NOAA (marine resources) • States • Native American Tribes • Many resources have overlapping trustees

4. Did Not See Significant NRD Cases Until…

5. Emergence of Significant NRD Cases • In 1989, Exxon Valdez ran aground in Prince William Sound, Alaska • Discharged between 11-31 million gallons of crude oil • Impacted over 1,300 miles of shoreline, and 11,000 square miles of ocean • Exxon spent over $2 Billion in remediation • Exxon settled NRD for another $1 Billion • Spill was impetus for Oil Pollution Act in 1990

6. Remediation versus Restoration • Remediation • Primary response • Risk based • Look at human health and ecological factors • Restoration • Secondary response / Residual to remediation • Focus on natural resources • Look at baseline (pre-discharge condition) • In addition to, not included in, remediation

7. NRD in Context • Prince William Sound Remediation – $2 Billion spent on efforts to: • Wash rocks and shoreline • Clean oiled animals • Contain oil spill • Siphon oil from water • Other activities to recover discharged oil

8. NRD in Context • Prince William Sound Restoration - $1 Billion to fund projects including: • Restore & compensate for impacted species (e.g., whales, otters, fish, birds, clams) [Ecological Services] • Restore & compensate for impacted industries (e.g., commercial fishing, tourism) [Economic Services] • Restore & compensate for impacted services (e.g., recreation, hunting, recreational fishing) [Human Use Services] • None of the foregoing addressed by remediation

9. Catastrophic Events versus Legacy Contamination • Valdez was not supposed to happen again • Deepwater Horizon in the Gulf • Pipeline in Yellowstone River in Montana • Pipeline in Mayflower, Arkansas • Catastrophic events, like oil spills, easier to address from political and legal standpoints • Generally true for both remediation & restoration

10. Catastrophic Events versus Legacy Contamination • Legacy sites more difficult • Determine who are Responsible Parties • Site history • Corporate transactions / reorganizations • Bankruptcies • Political willpower to pursue those Responsible Parties • Fortitude to endure legal & political processes

11. Catastrophic Events versus Legacy Sites • Examples of legacy sites: • Chemical facilities • Gasoline facilities • Manufacturing facilities • Military sites • Mining sites • Industrialized waterways (e.g., rivers, harbors) • Legacy sites are no less important than catastrophic release sites

12. States’ Responsibility to Pursue Remediation & Restoration States are empowered to pursue remediation and restoration in multiple capacities: • Via Statute: • Federal (e.g., CERCLA, OPA, CWA) • State (30+ States have Environmental statutes) • As Proprietor – State as owner of lands • As Private Actor – State as business • As Sovereign – Common law tradition and embodied in many State Constitutions

13. Common Law Tradition as Sovereign • 49 States derive legal tradition from English common law • Basis for Office of the Attorney General – which was “a necessary adjunct in the administration of the common law of England and was transported to America in the early days of the establishment of government in the Colonies as part of their English-derived common law.”

14. Common Law Tradition as Sovereign • Parens Patriae – “parent of the nation” – legal doctrine that recognizes the special role that a State plays in pursuing its quasi-sovereign interests in the well-being of its populace. • “A State’s quasi-sovereign interest is different and distinct from its sovereign interests in protecting its borders and its proprietary interests in owning land and conducting business.”

15. Common Law Tradition as Sovereign • “A State’s quasi-sovereign interests include the State’s interest in its citizens’ health, safety and welfare, as well as in a healthful environment.” • A State is the “Guardian of the Public and the Public’s resources.” • In short, at common law, State has duty to protect its people and its natural resources.

16. Common Law Tradition as Sovereign • Federal and State statutes embody some, but not all, of the common law tradition. • While Federal Trustees rely exclusively on federal law (and its corresponding limitations), State Trustees have additional legal resources (state law, common law, and multiple capacities to bring suit) in their arsenal.

17. Why is this Important to State Attorneys General? Staggering number of legacy sites, and to lesser extent, catastrophic event sites, that remain inadequately addressed by the federal process: • Wholly unaddressed • Insufficiently addressed • Remedy selection • Restoration projects • Time frame

18. Why is this Important to State Attorneys General? • Leaves significant void that only the States (and Tribes, in some instances) can address • Because States can bring suit in multiple capacities, have more flexibility in: • Scope of Remediation • Scope of Restoration • Quantification of Damages • Other remedies • Time frame • Certain legal issues

19. Trustee Interaction • Many resources have overlapping trusteeships • E.g., a river: • Feds may have interests in navigation and migratory birds; • State may have interests in native fish, other wildlife and recreational use; • Tribe may have cultural interests.

20. Trustee Interaction • States are not constrained regarding when they may bring NRD claims as are feds. • State Trustee may proceed with NRD claim under State law (statutory or common law) where federal Trustee is precluded by CERCLA. • May cause friction between Trustees where all do not join in action or agree on result.

21. Trustee Interaction • May diminish or even preclude recovery of NRD by the federal Trustee • Different courts have taken different approaches to address this issue: • In Okla. v. Tyson Foods, 258 F.R.D. 472 (N.D. Okla. 2009), the court dismissed the State’s NRD claims for failure to join a tribal trustee deemed a necessary party. • In Quapaw v. Blue Tee Corp., No. 03-CV-0846, 2010 WL 3368701 (N.D. Okla. Aug. 20, 2010), the court rejected the same argument because the tribal trustee limited its claims to resources on tribal land.

22. Trustee Interaction • In Coeur D’Alene Tribe v. ASARCO, Inc., 280 F. Supp. 2d 1094, 1116 (D. Idaho 2003), the court held that it must “award damages in the ratio or percentage of actual management and control that is exercised by each of the various co-Trustees” over the resource. • Two years later, the Court sua sponte reversed itself holding its “reliance on traditional tort concepts in allocating trusteeship was misplaced.”

23. Trustee Interaction • Rather, a “co-trustee acting individually or collectively with the other trustees may go after the responsible party or parties for the full amount of damage, less any amount that has already been paid as a result of a settlement to another trustee by a responsible party.” Coeur D’Alene Tribe v. ASARCO, Inc., 471 F. Supp. 2d 1063, 1068 (D. Idaho 2005).

24. Conclusion • There is a glut of un- or under-addressed legacy sites throughout the country. • States are not limited to the CERCLA paradigm. • States have significant and unique legal power to pursue remediation, restoration and other damages on behalf of their citizens. • States can accomplish significant results when other Trustees cannot, or will not, act.