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Lajim, LLC v. General Electric Company

United States Court of Appeals, Seventh Circuit

March 4, 2019

LAJIM, LLC, et al., Plaintiffs-Appellants,

          Argued January 15, 2019

          Appeals from the United States District Court for the Northern District of Illinois, Western Division. No. 13-cv-50348 - Iain D. Johnston, Magistrate Judge.

          Before Flaum, Kanne, and Hamilton, Circuit Judges.


         Plaintiffs-appellants purchased land near a former General Electric Company manufacturing plant that had operated for sixty years; the plant leached toxic chemicals that seeped into the groundwater. The Illinois Environmental Protection Agency filed suit under state law against General Electric in 2004 and has been working with the company since then to investigate and develop a plan to address the contamination. In 2013, plaintiffs filed suit under the citizen suit provision of the Resource Conservation and Recovery Act, seeking a mandatory injunction ordering General Electric to conduct additional investigation into the scope of the contamination and ordering the company to remove the contamination. The district court found the company liable for the contamination on summary judgment but denied plaintiffs' request for injunctive relief because, despite the many opportunities the court provided, plaintiffs did not offer evidence establishing a need for injunctive relief beyond what the company had already done in the state action. For the following reasons, we affirm.

         I. Background

         A. Statutory Scheme

         The Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6901, et seq., "is a comprehensive environmental statute that governs the treatment, storage, and disposal of solid and hazardous waste." Meghrig v. KFC W., Inc., 516 U.S. 479, 483 (1996). The RCRA "is not principally designed to effectuate the cleanup of toxic waste sites or to compensate those who have attended to the remediation of environmental hazards." Id. Rather, the primary purpose of the RCRA "is to reduce the generation of hazardous waste and to ensure the proper treatment... of that waste which is nonetheless generated, 'so as to minimize the present and future threat to human health and the environment.'" Id. (quoting 42 U.S.C. § 6902(b)).

         The RCRA contains a citizen suit provision, which provides that "any person may commence a civil action" against "any person" who has allegedly violated "any permit, standard, regulation, condition, requirement, prohibition, or order which has become effective pursuant to this chapter” or "who has contributed or who is 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." 42 U.S.C. § 6972(a)(1). Once the violation or potential endangerment is shown, a district court "shall have jurisdiction ... to restrain any person who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste" and "to order such person to take such other action as may be necessary." Id. § 6972(a).

         B. Factual Background

         1. General Electric Plant in Morrison, Illinois

         Defendant-appellee General Electric Company ("GE") operated a manufacturing plant in Morrison, Illinois from 1949 to 2010. To remove oil from the automotive and appliance parts it manufactured, the plant used chlorinated organic solvents, including trichloroethylene ("TCE"), perchloroethene ("PCE"), and trichloroethane ("TCA"). These solvents are toxic and are regulated by federal and state environmental agencies. GE used these solvents and stored them in degreasers located at the plant until 1994, when it switched to a soaplike solution to clean the parts.

         In 1986, chlorinated solvents were detected in three municipal supply wells that provided water to the City of Morrison, located several thousand feet southeast of the GE plant. Shortly thereafter, the Illinois Environmental Protection Agency ("IEPA") installed monitoring wells to analyze the groundwater around the GE plant, which uncovered additional contamination. The IEPA completed a Phase I Remedial Investigation in 1987, which included sampling and analysis of soil, water, and sediment. Based on the investigation, the IEPA identified the GE plant as the source of the solvent contamination.

         In 1988, GE installed additional monitoring wells and an air stripper to treat water pumped from one of Morrison's municipal wells to a level of contamination below the maximum contaminant level ("MCL") so the city could continue to use the well as a source of drinking water; the other two municipal supply wells were sealed. GE also conducted a Phase II Remedial Investigation, which identified elevated concentrations of solvents beneath the plant's former degreasing operations. Under the IEPA's supervision, GE continued to sample and monitor the groundwater in the monitoring wells and submitted reports of the results to the IEPA.

         In 1994, the IEPA required GE to conduct a Phase III Remedial Investigation of the groundwater at and downgradient from the plant. GE reported the results of the investigation in 2001. According to the report, the solvents in the groundwater had decreased significantly by 2001, and the report modeled that the contaminants would naturally attenuate (i.e., reduce) to concentrations below the MCL. Additionally, the report stated that Rock Creek was a natural groundwater divide that would prevent the contaminating solvents from migrating south from the GE plant across the creek. The report concluded that the contamination did not pose a risk to the public because a City of Morrison ordinance prohibited the use of groundwater as a source of drinking water and because GE's air stripper at the remaining municipal supply well provided safe drinking water.

         In response, however, the IEPA did not approve GE's proposal for natural attenuation of the contamination; instead, the IEPA concluded that active remediation of the site would be appropriate. The Illinois Attorney General commenced suit against GE in 2004 under the Illinois Environmental Protection Act: for cost recovery (Count I), see 415 Ill. Comp. Stat. 5/22.2(f); to enjoin water pollution (Count II), see 415 Ill. Comp. Stat. 5/42(d)-(e); and to enjoin a water pollution hazard (Count III), see 415 Ill. Comp. Stat. 5/12(d). The state sought to recover costs it had incurred as well as an injunction requiring that GE investigate the nature and extent of the contamination and then perform remediation. In 2010, GE and Illinois entered into a Consent Order in which GE agreed to submit to the IEPA a series of reports, including: (1) "a work plan to survey private wells, install additional monitoring wells, and complete additional soil borings"; (2) "a Focused Site Investigation Report ('FSI') summarizing the results of the work plan"; (3) "a Remedial Objectives Report to address the impact of the soil and groundwater contamination"; and (4) "a Remedial Action Plan to meet the remediation objectives within six years of the entry of the Consent Order." Also in 2010, the City of Morrison passed an ordinance prohibiting groundwater as a source of potable water and prohibiting the installation of wells "to limit threats to human health from groundwater contamination."

         After approval of a work plan, GE installed monitoring wells along Rock Creek. Then, in 2013, GE submitted its FSI detailing the data obtained from the various monitoring wells; the report explained that the solvents had migrated south of the plant and that the monitoring wells along Rock Creek tested positive for contamination at levels above the MCL. Tests from wells on the other side of Rock Creek (and further from the plant) either did not detect chlorinated solvents or detected TCE at a level below the MCL. Following discussions between GE and the IEPA on the work plan and FSI, the IEPA conditionally approved the FSI in March 2015. It determined that GE "adequately defined the nature and extent of the contamination." The IEPA conditionally approved GE's revised Remedial Objectives Report in August 2016, after a number of additional submissions and a meeting between the technical representatives from GE and the IEPA.

         In March 2017, GE submitted its Remedial Action Plan ("RAP") to the IEPA, proposing to achieve the remediation objectives through a "combination of institutional controls and monitored natural attenuation." The IEPA denied GE's proposal in June 2017, posing several questions about the plan, and specifically noting that it did not accept "an open-ended period of monitored natural attenuation as a remediation technology." GE submitted a revised RAP to the IEPA in October 2017, responding to the IEPA's questions and comments and proposing to address the remaining contamination through institutional controls. The IEPA approved GE's revised Remedial Action Plan in March 2018.

         2. Plaintiffs' Interest in the Land

         Plaintiff-appellant Lowell Beggs[1] purchased land near the site of the shuttered GE plant in 2007. He conveyed the property to plaintiff-appellant Prairie Ridge Golf Course, LLC, which plaintiff-appellant LAJIM, LLC operated. Beggs moved into a home next to the golf course with his companion, plaintiff-appellant Martha Kai Conway (the "Conway home"). The golf course and Conway home are located south of the former GE plant and downgradient from the plant.

         When Beggs considered purchasing the golf course in April 2007, the seller advised him: "the golf course has contamination on the first hole. This was caused by General Electric. If you go to the EPA web site, GE is listed as a superfund site. No further remediation was needed according to what I can find." Beggs did not inquire further about the environmental condition of the golf course before completing the purchase in May 2007. The purchase agreement noted, "[S]eller [] has disclosed to Purchaser that there is contamination on the first hole of the Real Estate, such contamination having been caused by General Electric, as which contamination is part of the Superfund Site that apparently does not require any further remediation." Additionally, Beggs walked the golf course prior to completing the purchase and noticed a monitoring well head protruding above the ground. After purchasing the property, Beggs contacted GE to fix a leak from the fixture, which he knew monitored "how much stuff was coming out of GE."

         C. Procedural Background

         Plaintiffs filed suit in the Northern District of Illinois on November 1, 2013 seeking: (1) a mandatory injunction requiring GE to remediate the contamination under the RCRA, see 42 U.S.C. § 6972(a)(1)(B) (Count I); (2) cost recovery (Count II) and a declaratory judgment (Count III) under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), see 42 U.S.C. §§ 9607(a), 9613(g)(3); and (3) recovery under state law for nuisance (Count IV), trespass (Count V), and negligence (Count VI).

         After what the district court characterized as "extensive discovery," the court considered the parties' cross-motions for partial summary judgment. Plaintiffs moved for summary judgment on their RCRA claim. GE did not dispute that plaintiffs satisfied the first two elements of the claim-(1) defendant has generated solid or hazardous waste, and (2) defendant has contributed to the handling of the waste. See Albany Bank & Tr. Co. v. Exxon Mobil Corp., 310 F.3d 969, 972 (7th Cir. 2002). On the sole remaining question-whether plaintiffs established that the contamination "may present an imminent and substantial danger to health or the environment," id. -the district court found for plaintiffs and granted summary judgment as to GE's liability under the RCRA. At plaintiffs' request, the court deferred consideration as to whether plaintiffs were entitled to injunctive relief. On GE's cross-motion for summary judgment on the state law claims, the district court found the continuing tort doctrine did not apply and found the claims time-barred because plaintiffs had knowledge of the claims more than five years before they filed suit.

         Over the next two years, the district court considered plaintiffs' request for a mandatory injunction in a number of hearings and a series of opinions. On October 4, 2016, the court held that the plain language of the RCRA permitted, but did not require, the court to grant injunctive relief despite the ongoing state proceeding; thus, the question before the court was not whether it could grant relief but whether it should. On this point, the court concluded plaintiffs had not yet provided the court with facts supporting their assertion that the Consent Order in the state action was deficient and ineffective. The court ordered an evidentiary hearing and invited the IEPA and the Illinois Attorney General to provide their views on the progress under the Consent Order and whether the court should order injunctive relief under the RCRA. The Illinois Attorney General's Office submitted an amicus brief explaining that the State did not believe the court should impose injunctive relief because any court-ordered injunctive relief would overlap with the work currently being done-i.e., "site investigation, monitoring and payment of costs as well as an order barring further endangerment... [and] some type of remedial effort." The State asserted that all such actions were already underway and were "being done with diligence and rigorous oversight by the Illinois EPA," and that injunctive relief "may result in a clean-up that is inconsistent with clean ups of other contaminated sites in Illinois."

         After two days of evidentiary hearing on June 1 and 2, 2017, the court issued an opinion on September 7, 2017 denying the requested injunctive relief. Both parties had presented expert testimony at the hearing; the district court credited GE's expert as having "provided reasonable, rational and credible bases explaining why certain actions were taken and others were not," whereas it found plaintiffs' expert did not provide conclusions but merely "testified that additional investigation and testing was necessary to opine on the proper scope of remediation for the site." Notably, when asked by the district court judge what specific cleanup he recommended, plaintiffs' expert declined to make a recommendation. The district court thus concluded that plaintiffs had not met their burden of showing harm not already addressed sufficiently by the IEPA proceeding. The court denied plaintiffs' motion to reconsider the denial of injunctive relief on November 7, 2017. Plaintiffs voluntarily dismissed the remaining count under the CERCLA with prejudice and filed a notice of appeal on March 6, 2018.

         Then, on March 23, 2018, plaintiffs filed a motion for an indicative ruling under Rule 62.1 and motion to reconsider based on newly discovered evidence. Plaintiffs pointed to the IEPA's March 2, 2018 approval of GE's Remedial Action Plan, which relies solely on institutional controls to address the remaining contamination. The district court denied plaintiffs' motion on August 14, 2018, and plaintiffs appealed. That appeal was consolidated with plaintiffs' original appeal; both are jointly before us now.

         II. ...

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