Reply Brief — Scott v. City of Hammond

x Ofice-Supreme Court, vs. |

, SiLE D

6 thon JAN 4 1985

| ALEXANSE? 1 STEVAS.

IN THE 1 GLEN

Supreme Court of the United States

OCTOBER TERM 1984

WILLIAM J. SCOTT, on his own behalf and on behalf

of all persons similarly situated,

Petitioner,

VS.

CITY OF HAMMOND, INDIANA; UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY; DOUGLAS

M. COSTLE, Administrator of the United States Environmen-

tal Protection Agency; and the HAMMOND-MUNSTER SAN -

ITARY DISTRICT,

Respondents.

PETITIONER SCOTT’S REPLY

TO THE BRIEF OF THE

UNITED STATES AS

AMICUS CURIAE

JOSEPH V. KARAGANIS*

A. BRUCE WHITE

KATHLEEN M. DONAHUE

K ARAGANIS, GAIL & WHITE LTD.

150 North Wacker Drive

Suite 2500

Chicago, Iliinois 60606

(312) 782-1905

Attorneys for Petitioner

* Counsel of Record

Pandick Midwest, Inc. Chicago © 454-7600

i

TABLE OF CONTENTS

The Position of the United States Would Destroy

Essential State Law Tort Protection and the Histoncal

Constitutional Framework Upon Which That Protec-

I cadebitihicttk iscliusatedesniattoninbianccochintihgicelichabiaiarrinssbiiiicitiene

A. The Historical Framework Prior to Milwaukee I...

B. The Milwaukee I “Holding” as Illuminated by

I ede chenincaincen

C. The Seveath Circuit Variant ..........0....<....00..2..........

EE ER aC: aN Bae aE, Re ae a

PAGE

il

5)

TABLE OF AUTHORITIES

Cases

City of Evansville, Ind. v. Kentucky Liquid Recy-

cling, Inc., 604 F. 2d 1008 (7th Cir. 1979), cert.

denied sub nom., Louisville and Jefferson County

Metropolitan Sewer District v. City of Evansville,

Erndd., 444 US: 1025S ( 19D) .csccceseccsasseesinaresecosvecees

City of Milwaukee v. Illinois (“Milwaukee II’’),

GE FER. Be C FOE} sionenciigiieisdctaeee

Davis v. Passman, 442 U.S. 228 (1979) wooo.

Day & Zimmermann, Inc. v. Challoner, 423 U.S. 3

DFS} saiscinsinsnitrsnsdcsaaccivatininininciiniacdneddical tae oceania:

Illinois v. City of Milwaukee (‘*Milwaukee I’’), 406

Le. 9S CURE? wicinssntoesaiebmaca.

Klaxon v. Stentor Electric Mfg. Co., 313 U.S. 487

SIE Dicsssianinicttinissnsestincdenpaiadccadhaitae aac

Washington v. General Motors Corporation, 406

RJ WOO, UPEED snisinctenseccueouanne nein

Statutes

Judicial Code, as amended 28 U.S.C. Section 1391.

PAGE

2,6

passim

2

passim

4,7,9

IN THE

Supreme Court of the Anited States

OCTOBER TERM 1984

WILLIAM J. SCOTT, on his own behalf and on behalf

of all persons similarly situated,

Petitioner,

vs.

CITY OF HAMMOND, INDIANA; UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY; DOUGLAS

M. COSTLE, Administrator of the United States Environmen-

tal Protection Agency; and the HAMMOND-MUNSTER SAN-

ITARY DISTRICT,

Respondents.

PETITIONER SCOTT’S REPLY

TO THE BRIEF OF THE

UNITED STATES AS

AMICUS CURIAE

The Position of the United States Would Destroy

Essential State Law Tort Protection

and the Historical Constitutional Framework

Upon Which That Protection is Based

In contrast to societies that settle their disputes with

machine guns and grenades, we in the United States quite

proudly point to our constitutional tradition under a “Rule of

Law”. The hallmark of our “Rule of Law” has been the

concept of reasoned decisionmaking as opposed to decisions

made by caprice and arbitrary fiat. Decisions and positions

taken by our governmental institutions—especially the judi-

ciary—must be based on logical, internally consistent reason-

ing.

=

To the public and the lawyers who practice before this

Court, the ultimate protector of this mandate for reasoned

decisionmaking has been the Supreme Court of the United

States. Yet the incredible propositions put forth by the amicus

brief of the Solicitor General suggest that the motto of this

Court should be changed to “Abandon reason, all ye who enter

here”. Acceptance of the Seventh Circuit’s position, as en-

dorsed by the Solicitor General, will lead this Court away from

the realm of reason into a Louis Carroll fantasy world of

frightening dimensions.

The issue here, as framed by this Court’s decisions in

Milwaukee I' and Milwaukee IJ2 is whether any state law can

be applied to impose liability and provide a remedy? for

interstate torts where:

1) the tortfeasor is in one state;

2) the tort victim is in another state; and,

3) the tortious conduct crosses state lines through the air

or the water.4

To illustrate the extreme nature of the Solicitor General’s

position, this reply describes three legal frameworks which have

been applied to this issue: 1) the historic framework prior to

Milwaukee I; 2) the framework defined from reading the

footnotes of Milwaukee I and Milwaukee II; and, 3) the

framework created by the Seventh Circuit below and endorsed

by the Solicitor General. To give the analysis more currency,

petitioner asks the Court to consider these frameworks as

~~applied to the following all too real hypothetical question.

' [Illinois v. City of Milwaukee, 406 U.S. 91 (1972).

2 City of Milwaukee v. Illinois, 451 U.S. 304 (1981).

3 Petitioners’ repeated reminders that the issues of liability and

remedy are distinct continues to fall on deaf ears. Davis v. Passman,

442 U.S. 228 (1979); City of Evansville, Ind. v. Kentucky Liquid

Recycling, Inc., 604 F.2d 1008, i019 (7th Cir. 1980).

“The holding of Milwaukee [—whatever that holding is—

applies equally to air pollution. See Washington v. General Motors

Corporation, 406 U.S. 109, 112, n.2 (1972), issued the same day as

Milwaukee I.

3

How would these three legal frameworks apply in the

event an accident like the Bhopal, India release occurred in the

United States? An identical twin to the Bhopal methyl isocyan-

ate plant exists in Institute, West Virginia—not far from the

borders of Kentucky and Ohio. What if methyl isocyanate was

released as a liquid from the Institute plant and had vapomzed,

and the vapor cloud traveled north and west into communities

in Ohio and Kentucky? What if thousands of Kentucky and

Ohio citizens were killed by the poison cloud? Alternatively,

what if the deadly liquid poison remained in liquid form and

traveled instead from the Institute plant into the Kanawha

River, and thence down the Kanawha into the Ohio River,

poisoning citizens in Kentucky and Ohio who drank the poi-

soned water? Could the Ohio and Kentucky victims bring a tort

action under state law seeking damages and injunctive relief?S

Under the three different frameworks discussed below, the

injured citizens of Ohio and Kentucky and the relatives of the

dead Ohioans and Kentuckians would have dramatically differ-

ent legal rights. Similarly, the law enforcement nghts of

Kentucky and Ohio state law enforcement agencies would also

be dramatically different—depending on which framework

applied. The three frameworks would provide relief to the

Ohio and Kentucky victims, and to the law enforcement

agencies of Kentucky and Ohio as follows.

A.

The Historical Framework Prior to Milwaukee I

Prior to Milwaukee I, the law on this subject was very

clear. State law governed the issue of civil and cnminal

liability. (See cases cited in Petitioner Scott’s petition at pp. |4-

15 and in the Court of Appeals opinion at A-17, n.3). And the

choice of state law was governed by choice of law rules of the

5 Petitioner Scott’s action seeks both damages and injunctive

relief. As noted above, the cause of action is the same under either

form of relief and is independent of the relief sought.

4

forum state as long as these rules were consistent with due

process. Klaxon v. Stentor Electric Mfg. Co., 313 U.S. 487

(1941); Day & Zimmermann, Inc. vy. Challoner, 423 U.S. 3

(1975).

Under this historic framework, there is no question that the

injured Ohio and Kentucky citizens could bring their actions

against the owners and operators of the West Virginia plant in

the state courts of Ohio and Kentucky, respectively. Alterna-

tively, they could bring the actions in the federal district courts

in Kentucky and Ohio under diversity jurisdiction and venue

would lie in such courts under 28 U.S.C. Section 1391. Under

governing principles of in personam jurisdiction, it is clear that

the Kentucky and Ohio courts, be they state or federal, would

have in personam jurisdiction over the plant owners and or

operators in West Virginia.® Finally, the choice of the substan-

tive state tort law to be applied would be determined by the

choice of law rules of the forum state.

Similarly, in the controversy below, the state courts of

Illinois would have in personam jurisdiction against the out-of-

state tortfeasor and would apply whatever state law was

determined to be appropriate under Illinois choice of law rules.

Further, the law is equaily clear that a federal district court in

Illinois in a diversity case brought on a state law claim would

apply the choice of law rules of the forum state. Finally, venue

would be proper in the federal district court in Illinois.

The Milwaukee I “Holding” as Illuminated by Milwaukee I]

This Court’s decision in Milwaukee I as “illuminated” by

this Court’s decision in Milwaukee I] has thrown an irrational

monkeywrench into this carefully crafted historical framework.

Frankly, lawyers’ attempts to divine the “holding” of Mil-

waukee I as to the issue now before this Court is akin to Ulysses

6 The Kentucky and Ohio law enforcement agencies could bring

criminal charges against the West Virginia plant operator under

Kentucky and Ohio law.

and his men reading goat entrails to divine the intention of the

gods. The “true meaning” of Milwaukee I and its obscure

footnotes on the issue of preemption of state law for interstate

air and water pollution torts—and the tonstitutional or statu-

tory basis for such preemption—is delphic.

Nevertheless, the cryptic footnotes of Milwaukee J have

been given some illumination by another set of less than clear

footnotes in Milwaukee I].

If state law can be applied, there is no need for federal

common law; if federal common law exists, it is because

state law cannot be used.

Milwaukee II at p. 313, n.7 (emphasis added).

The asserted import of this Milwaukee IJ footnote dictum,

in combination with footnotes 6 and 9 of the Milwaukee I

opinion, is that federal law, presumedly based in the Con-

stitution, prohibits the application of state tort law to determine

liability or establish remedy in ‘cases of interstate air or water

pollution torts. Nowhere is the constitutional provision which

dictates such preemption identified; nowhere in either Mil-

waukee I or Milwaukee I] are the implications of such a hoiding

discussed or analyzed.

If some unspecified constitutional mandate preempts the

application of state law to interstate air and water pollution

torts, such preemption clearly extends to application of all state

law. If in the words of Milwaukee II, federal law must govern

the issue, “it is because state law cannot be used. ””

7 Indeed, one of the asserted purposes behind such preemption

was to prevent one state’s law from being applied to the “sovereign”

interests of a neighboring state. In the field of interstate air and water

pollution torts—unlike the mynad cases of interstate tort by other

instrumentalities—there appears to be some hoary vestigial concept of

50 independent feifdoms ready to wage war unless federal law is

applied to the issue of tort liability and remedy. Clearly this alleged

purpose in preempting state law would be equally violated by

applying the tortfeasor’s law against the victim state and in requiring

the victim state to seek relief in the tortfeasor state courts.

However, reading cryptic footnotes as if they were well-

crafted declarations of major changes in an entire field of law is

a dangerous exercise that can produce catastrophic results. By

“holding” that federal law must determine tort liability for

interstate air and water pollution torts in Milwaukee J, and then

by holding in Milwaukee I] that Congress in the passage of the

Clean Water Act preempted any federal common law tort

remedy, this Court has wiped out all tort law relief for victims

of interstate air or water pollution.

Applying the Milwaukee I “holding” to the hypothetical

release of methyl isocyanate, the injured Kentucky and Ohio

citizens would be barred from any tort action under state law.®

Under the cryptic footnote “holding” of Milwaukee I as

illuminated by the footnotes of Milwaukee II, no state law can

apply to interstate air and water pollution torts. See City of

Evansville, Inc. v. Kentucky Liquid Recycling, Inc., 604 F.2d

1008, 1018 n.30 (7th Cir. 1979). Since Milwaukee I] held that

no federal common law tort action survived the passage of the

- Clean Water Act (and implicitly, the Clean Air Act) and since

Congress did not provide a tort remedy for interstate pollution

torts in either the Clean Air Act or the Clean Water Act, the

Kentucky and Ohio citizens would be without any tort relief.

Similarly, under the same reasoning, Ohio and Kentucky law

enforcement officials would be powerless to invoke Kentucky or

Ohio criminal laws against the perpetrators of the act.

Such a federal law preemption would indeed be ironic in

light of Congress’s expressed intention to preserve state law

_ when passing the Clean Air Act and Clean Water Act. Con-

gress clearly intended to preserve state tort law in its historical

framework and certainly expressed no desire to restrict the

criminal law jurisdiction of the states.

8 By barring the state law cause of action, the Milwaukee ]

holding bars damage relief as well as any injunctive relief.

G

The Seventh Circuit Variant

Trapped by the divined meaning of the Milwaukee J and

Milwaukee I] footnotes, and the anomalies created by ad-

herence to such footnotes, the Seventh Circuit, with the

endorsement of the Solicitor General, has built a second story to

the Milwaukee I house of cards which is even more bizarre.

Having asserted that Milwaukee J declared a constitutional

prohibition against the application of state law which was by

implication reaffirmed in Milwaukee IJ, the Solicitor General

then uses the last two pages of his brief to say that the

petitioners here do have a cause of action under state tort

law—but only under the state law of the tortfeasor’s state and

only in the federal or state courts in the tortfeasor’s state

(Solicitor General’s brief at 13, 14)!

Under the variation announced by the Seventh Circuit

below, and endorsed by the Solicitor General, the injured Ohio

and Kentucky citizens could bring tort actions under state law,

but only under West Virginia state law and only in West

Virginia state courts or federal courts in West Virginia! Beyond

the bizarre holding that only West Virginia tort law could

apply, the Seventh Circuit’s decision would bar Ohio and

Kentucky courts (and federal district courts in Kentucky and

Ohio) from applying West Virginia law and would disregard

the express venue provisions of 28 U.S.C. Section 1391(a)

~ which allows an action based on diversity of citizenship to be

brought in the district where the plainuff resides or where the

cause of action arose. Needless to say, under the Seventh

Circuit variant, Ohio and Kentucky law enforcement officials

would be powerless to seek criminal sanctions under Ohio and

Kentucky law against the perpetrators of the release.

The illogic of the Milwaukee I footnote “holding” that no

state law can be applied in this situation is now compounded by

the claim that state law can apply, but only if it is the

tortfeasor’s state law and only if applied in the tortfeasor’s state.

Given the purported holding of Milwaukee I that all state law

was preempted, where did this state law come from?

The Solicitor General does not say whether this state tort

law claim is grounded in federal law or is truly state law. If it is

grounded in federal law through some sort of unstated in-

corporation by Congress as a federal rule of decision under the

Clean Water Act (see Petitioner Scott’s petition, at p. 22), such

a federal version of state tort law would create vast new

problems. (See Petitioner Scott’s petition, at pp. 22-25).

If the state law claim endorsed by the Solicitor General is

not based on federal law but is truly state law, again, where did

it come from? Clearly, the Solicitor General does not believe

that the Congress revived the state law claim with the passage

of the Clean Water Act.

This Court’s rationale for holding in Milwaukee II that the

CWA displaced the federal common law of nuisance

provides no ground for inferring that a state law action has

been revived.

Solicitor General’s brief p. 8.9

If the state tort law cause of action did not come from the

Clean Water Act, it must have existed prior to the Clean Water

Act. If so, the Solicitor General is arguing that this Court’s

footnote holding in Milwaukee IJ did not preempt all state law

tort causes of action, only causes of action under the victim’s

state law. Such an interpretation of Milwaukee I is simply

preposterous. Either the Constitution preempted the appli-

cation of all state law or no state law. Selective preservation of

the tortfeasor state’s law while destroying the victims state’s law

and judicial auth~rity was not the holding of Milwaukee I.

9 It is clear that Congress is not empowered to create state law.

Congress can only remove federal impediments to preexisting state

law or alternatively adopt state law rules as federal rules of decision.

Equally without explanation, the Solicitor General en-

dorses the Seventh Circuit’s rewriting of the law of choice of

law, in personam jurisdiction and venue in a diversity case.

Concomitant with its ex cathedra revival of a state law claim

under the tortfeasor’s state law,’9 the Seventh Circuit also

rewrote the United States Code as to venue and the due process

clause as to in personam jurisdiction.

If the Seventh Circuit’s position is correct and is approved

by the Solicitor General, the only place this plaintiff can bring a

diversity action under the tortfeasor’s state law is the federal

court in the tortfeasor’s state. This would be a judicial rewrite

of the Judicial Code’s venue statute, 28 U.S.C. Section !391(a).

Under the theory supported by the Solicitor General, the

plaintiff could only bring an action in the district where the

defendants reside. In contrast, Section 1391(a) allows a

diversity action to be filed either in the district where the

defendant resides or where the plaintiff resides or where the

cause of action arose.

Similarly, the position endorsed by the Solicitor General

also rewrites the law of in personam junisdiction. Under the

Seventh Circuit’s decision, the state law ciaim under the

tortfeasor state’s law can only be brought in the state and

federal courts of the tortfeasor’s state. This would completely

rewrite the law of in personam jurisdiction.

10 Nowhere does the Solicitor General explain the Seventh

Circuit’s refusal to apply Indiana choice of law rules to Petitioner

Scott’s claim—which choice of law rules dictate application of Illinois

law. Further, nowhere does the Solicitor General explain the Seventh

Circuit’s use of the Restatement of Torts as a “state law ground” to

deny Scott’s damage claim. Use of the Restatement to bar a claim for

damages allowed by the Illinois Constitution is not authorized by

either Illinois law or Indiana law.

19

Conclusion

The preposterous results arising from application of the

frameworks of “Milwaukee I/ Milwaukee II” and “the Seventh

Circuit Variant” are indefensible from the standpoint of con-

stitutional history or logic. This court must clear the air and re-

establish the historic framework of reasoned principles govern-

ing this subject.

Respectfully submitted,

JOSEPH V. KARAGANIS*

A. BRUCE WHITE

KATHLEEN M. DONAHUE

KARAGANIS, GAIL & WHITE LTD.

_150 North Wacker Drive

Suite 2500

Chicago, Illinois 60606

(312) 782-1905

Attorneys for Petitioner

* Counsel of Record a