Supplemental Brief — Gwaltney of Smithfield, Ltd. v. Chesapeake Bay Foundation, Inc.

, Supreme Court, U.S.

\tp FILED

No. 86-473 jan & 87

a Te se IR.

RK

IN THE eae —

Supreme Court of the United States

OCTOBER TERM, 1986

GWALTNEY OF SMITHFIELD, LTD.,

Petitioner,

Vv.

CHESAPEAKE BAY FOUNDATION, INC..,

and

NATURAL RESOURCES DEFENSE COUNCIL,

Respondents.

On Petition for Writ of Certiorari to the United States

Court of Appeals for the Fourth Circuit

SUPPLEMENTAL BRIEF

E. BARRETT PRETTYMAN, JR.*

RICHARD J. M. POULSON

PATRICK M. RAHER

- DAvip J. HAYES

CATHERINE JAMES LACROIX

JOHN G. ROBERTS, JR.

HOGAN & HARTSON

(a partnership including

professional corporations)

815 Connecticut Avenue, N.W.

Washington, D.C. 20006

(202) 331-4685

Counsel for Petitioner

* Counsel of Record

WILSON - Eres Printine Co., Inc. - 789-0096 - WasHINncToNn. D.C. 20001

an

InN THE

Supreme Court of the United States

OCTOBER TERM, 1986

No. 86-473

GWALTNEY OF SMITHFIELD, LTD.,

Petitioner,

v.

CHESAPEAKE BAY FOUNDATION, INC.,

and

NATURAL RESOURCES DEFENSE COUNCIL,

Respondents.

On Petition for Writ of Certiorari to the United States

Court of Appeals for the Fourth Circuit

SUPPLEMENTAL BRIEF

Petitioner, Gwaltney of Smithfield, Ltd., submits this

supplemental brief pursuant to Supreme Court Rule 22.6

to call to the attention of the Court a recent decision on

the same question as that presented in the Petition. On

December 18, 1986, the First Circuit issued its opinion

in Pawtuxet Cove Marina, Inc. v. Ciba-Geigy Corp., No.

86-1227. A copy of the opinion is attached. The First

a

Circuit affirmed the dismissal of a citizen suit seeking

civil penalties for past violations under the Clean Water

Act, noting that the “draftsmanship” of the citizen suit

provision “leaves something to be desired.” App. at 5a.

In dismissing the citizen penalty action, the First Cir-

cuit expressly rejected the “unlimited meaning [of the

statute] adopted by the Fourth Circuit” in the case pres-

ently before this Court. Jd. The First Circuit found the

argument of the Fourth Circuit “forced” and the analogy

drawn by the Fourth Circuit “inapt.” Jd. The First Cir-

cuit concluded: “With great respect to the Fourth Cir-

cuit, we find its conclusion of ambiguity unpersuasive,

particularly when it would have been so easy for Congress

to have said ‘has violated,’ instead of ‘is * * * in viola-

tion’ if the former was its intention, and with the differ-

ence being so conspicuous.” Jd. at 6a.

The First Circuit adopted a third interpretation of the

citizen suit provision, different from that of the Fourth

Cireuit below and different from that of the Fifth Circuit

in Hamker v. Diamond Shamrock Co., 756 F.2d 392 (5th

Cir. 1985). As the First Circuit recognized, its interpre

tation of the statute “lies somewhere between an ab-

solute, literal, application of its language and the un-

limited meaning adopted by the Fourth Circuit.” App.

at 5a. The First Circuit, however, expressly noted that

it agreed with the result in Hamker. App. at 9a.

This recent decision of the First Circuit confirms the

need for this Court to grant certiorari in this case to

resolve the worsening conflict among the Circuits over the

proper interpretation of the citizen suit provision of the

Clean Water Act. Another Circuit has expressed its dis-

agreement with the reasoning of the court below, adding

a third interpretation to the direct conflict that previ-

ously existed. This Court should grant the writ to re-

3

solve this conflict over the proper interpretation of the

jurisdictional provision of an important Federal statute.

* Counsel of Record

Respectfully submitted,

E. BARRETT PRETTYMAN, JR.*

RICHARD J. M. POULSON

PATRICK M. RAHER

DAVID J. HAYES

CATHERINE JAMES LACROIX

JOHN G. ROBERTS, JR.

HOGAN & HARTSON

(a partnership including

professional corporations)

815 Connecticut Avenue, N.W.

Washington, D.C. 20006

(202) 331-4685

Counsel for Petitioner

APPENDIX

la

APPENDIX

UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

No. 86-1227

PAWTUXET COVE MARINA, INC., et al.,

Plaintiffs, Appellants,

V.

CIBA-GEIGY CORPORATION,

Defendant, Appellee.

Appeal from the United States District Court

for the District of Rhode Island

{Hon. Bruce M. Selya, U.S. District Judge]

Before

Campbell, Chief Judge,

Aldrich and Coffin, Circuit Judges.

Jeffrey A. Lanphear for appellants.

James Thornton on brief for Natural Resources De-

fense Council, Inc., amicus curiae.

Karen H. Edgecombe, Bruce J. Terris and Terris,

Edgecombe, Hecker & Wayne on brief for Friends of the

Earth, Sierra Club, Student Public Interest Research

Group of New Jersey and Atlantic States Legal Founda-

tion, amici curiae.

a

2a

Katherine L. Rhyne, with whom Douglas E. Kliever,

John M. Bredehoft, Cleary, Gottlieb, Steen & Hamilton,

Michael P. DeFanti and Hinckley, Allen, Tobin & Silver-

stein were on brief for appellee.

December 18, 1986

ALDRICH, Senior Circuit Judge. In 1979 plaintiff

Pawtuxet Cove Marina, Inc., purchased a marina on a

cove by the mouth of the Pawtuxet River in Rhode Island.

Plaintiffs Russell and Beverly Hunt, owners of a resi-

dence on the cove, as well as officers and shareholders in

Marina, Inc., purchased a secon’ marina on the cove

and leased it to Marina, Inc. In November 1983 plain-

tiffs sued defendant Ciba-Geigy Corp., in part for civil

penalties under section 505 of the Clean Water Act, 33

U.S.C. § 1365, and in part for damages due to violations

of Rhode Island common law. Defendant was located up

river. From the penalty standpoint it, allegedly, had

violated its permit under the National Pollutant Dis-

charge Elimination System by discharging effluents con-

taining excessive pollutants. From the damage stand-

point the presence of these pollutants had, allegedly, pre-

vented dredging to improve access to plaintiffs’ properties,

causing economic loss and, in turn, stress-produced ill-

nesses. On defendant’s motion for summary judgment

the court dismissed the penalty action for lack of juris-

diction. Diversity jurisdiction existed for the damage

claims. However, upon plaintiffs’ stipulating during trial

that these, unless for nominal damages, which they

waived, depended upon proof that the dredging would

have occurred but for defendant’s polluting, the court

ruled that plaintiffs had not made out a case. Plaintiffs

appeal. We affirm.

The Pawtuxet River area silts up. In the early 1960’s

an agreement was entered into whereby the Army Corps

3a

of Engineers, funded by federal, state, and municipal

contributions, dredged it to a depth of six feet at mean

low water. A breakwater was built for protection, which,

unfortunately, increased siltation, and it was recognized

that substantial periodic dredging would be required for

maintenance. This expectation proved to be correct, but

further dredging, though long needed, has not taken

place. Indeed, one of the municipalities did not even

fulfill its original obligations.

The principal impediment to maintenance dredging

was the cost; everyone being in favor of the project, pro-

vided someone else paid. While discussions still continue,

no money has ever been appropriated, federal or other-

wise, nor have plaintiffs shown any appreciable prospect

thereof. The problem was aggravated by a Rhode Island

regulation passed in the early 1970’s forbidding dump-

ing of dredged materials in offshore waters. Since then

a lack of disposal space has precluded almost all Rhode

Island dredging, even of needed terminal facilities, let

alone of recreational areas. It is true that some neigh-

bors of possible disposal sites have objected to defend-

ant’s pollutants, but we agree with the district court

that as a matter of law on the overall record this was

an insignificant, and in no sense a “but for” factor.

Brodeur v. Desrosiers, 505 A.2d 418, 423 (R.I. 1986);

Salk v. Alpine Ski Shop, Inc., 115 R.I. 309, 312-13, 342.

A.2d 622, 625 (1975). Twenty years of negative history,

quite apart from defendant’s pollutants, with no indica-

tion of any change, left plaintiffs with nothing but hope.

This was clearly insufficient to make out a case against

defendant.

In this circumstance we need not consider plaintiffs’

other common law obstacle, that actions for negligence

generally require proof of physical, as distinguished from

mere economic, harm. Cf. Barber Lines A/S v. M/V

Donau Maru, 764 F.2d 50 (1st Cir. 1985) ; Louisiana ex

rel. Guste v. M/V Testbank, 752 F.2d 1019 (5th Cir.

4a

1985), cert. denied, 106 S. Ct. 3271. But cf. Burgess v.

M/V Tamano, 370 F. Supp. 247 (D. Me. 1973), aff'd

without opinion, 559 F.2d 1200 (1st Cir. 1977) (permit-

ting fishermen to recover for pecuniary losses caused by

oil spill).

We turn to the more open question, the district court’s

ruling that plaintiffs, as private citizens, could not main-

tain a Clean Water Act action simply to enforce penal-

ties with respect to violations that had already ceased.

Plaintiffs’ complaint was, of necessity, limited to the

past (“has discharged effluents’), because of the fact

that, prior to its filing, defendant had completed a tie-in

with a municipal treatment facility and had ceased op-

erating under the permit. Plaintiffs, accordingly, did

not and could not, at least prima facie, trace the statu-

tory language, which is addressed to the present.

Sec. 505(a). Except as provided in subsection (b)

of this section, any citizen’ may commence a civil

action on his own behalf—

(1) against any person . . . who is alleged to be

in violation of (A) an effluent standard or lim-

itation under this Act .... The district courts

shall have jurisdiction, without regard to the

amount in controversy or the citizenship of the

parties, to enforce such an effluent standard or

limitation, or such an order, or to order the

Administrator to perform such act or duty, as

the case may be, and to apply any appropriate

civil penalties under section 309(d) of this Act.

(emphasis added )

1A citizen is defined in subsection (g) as a “person or persons

having an interest which is or may be affected.” Since we dismiss

on other grounds, post, we need not decide whether plaintiffs suc-

ceeded in showing such. See discussion in Chesapeake Bay Founda-

tion v. Bethlehem Steel Corp., 608 F. Supp. 440 (D.Md. 1985).

5a

While this failure might seem a short and conclusive

answer, plaintiffs cite district court cases, culminating

with the recent case of Chesapeake Bay Foundation, Inc.

v. Gwaltney of Smithfield, Ltd., 791 F.2d 304 (4th Cir.

1986), holding that the court not only may assess pen-

alties for past violations in a citizen’s suit (which, in

itself, we do not question), but may entertain a suit

seeking only that relief. Plaintiffs also cite language by

Senator Muskie, post, one of the proponents of the Act,

purportedly indicating the same intent.

We find it apparent, not only from this, but from a

study of the statute as a whole, that its draftsmanship

leaves something to be desired, in part, perhaps, because

of the scope of the problems. We affirm the district

court, but we think the proper interpretation of the stat-

ute lies somewhere between an absolute, literal, applica-

tion of its language and the unlimited meaning adopted

by the Fourth Circuit.

The Gwaltney court found the key statutory language

—‘is . . . in violation”’—ambiguous, and hence encom-

passing all past, as well as present, violations. The court

reasoned that one “continues to be ‘in violation’ by hav-

ing ‘violated.’ ... [T]he taint of a past violation is

continuing.” 791 F.2d at 309 (quoting Student Public

Interest Research Group v. Monsanto Co., 600 F. Supp.

1474, 1476 (D.N.J. 1985)). For this it analogized the

case of a taxpayer who underpaid one year, but did not

the next, pointing out that, until he paid, he continued

to be “in violation.” We find the argument forced, and

the analogy inapt. In the case of the taxpayer, the viola-

tion was the non-payment, and it, of course, continued

until the obligation was met. A ceased improper dis-

charge does not “continue.” Moreover, the “violation” de-

fined by the statute is not the non-payment of the pen-

alty.

Nor does the statute speak in terms of “taint.” This

might be arguable if it had read “is a violator,” but “is

a

6a

. in violation” speaks in terms of activity. The clear

import of section 505(a) is that citizens are empowered

to seek injunctive relief against a polluter that “is in

violation” of the Act, and that in connection with such

an action the district court is authorized to award “any

appropriate” civil penalties. With great respect to the

Fourth Circuit, we find its conclusion of ambiguity un-

persuasive, particularly when it would have been so easy

for Congress to have said “has violated,” instead of “is

. in violation” if the former was its intention, and

with the difference being so conspicuous.

We note, too, that “effluent standard or limitation,”

ante, is defined in section 505(f)(6) as a “permit or

condition thereof issued under section 402 of this Act,

which is in effect under this Act... .” (emphasis added),

a clear use of the present. It is true that under section

505(f)(1)’s definition of “effluent standard or limita-

tion” the incorporation of other sections by reference

produces grammatical confusion, but, in sum, in speaking

of any “discharge” not otherwise excepted, there is no

retreat from the present tense.

This use does not seem inconsistent, historically, with

the enforcement emphasis of the anti-pollution acts. The

Clean Air Act, from which the Clean Water Act took the

phrase “is . . . in violation,” see 42 U.S.C. § 7604(a),

provided for injunctive relief only. Alertness of con-

cerned citizens, see § 505(g), n.1, ante, was of moment,

but of secondary importance; even when, in enacting the

Clean Water Act, Congress added penalties, such were to

go to the government. There was no change in purpose.

Rather, House and Senate Reports on the Clean Water

Act characterize the addition of civil penalties as simply

a modification of the citizen’s action for injunction au-

thorized under the Clean Air Act.? Thus we cannot share

2 See S. Rep. No. 414, 92d Cong., Ist Sess. 79 (1971), reprinted in

1972 U.S. Code Cong. & Admin. News 3668, 3745:

7a

the Gwaltney court’s reliance upon the fact that if the

words “is . . . in violation” require a showing of a viola-

tion at the time of suit, many past violations would be

immune to citizens’ suits. Some immunity was an origi-

nally contemplated circumstance; the court uncovered no

unique lacunae. No amount of discovering ambiguity in

the quoted words can escape the fact that, with respect

to alleged violations of permits, § 505(f) (6), ante, no

action can lie for past violations unless the “permit. . .

is in effect.” This consistently corresponds with the ref-

erence to violations in the present tense; past permit vio-

lations are relevant to the extent that they cast light on

the propriety of an injunction, no longer appropriate if

there is no longer a permit.’

The Committee has established a provision in the bill that would

provide citizen participation . . . modeled on the provision

enacted in the Clean Air Amendments of 1970. As in that Act

the provision in this bill is carefully restricted to actions where

violations of standards and regulations or a failure on the part

of officials to act are alleged. One modification would allow the

Courts to impose civil penalties provided as a result of actions

brought by citizens.

See also H.R. Rep. No. 911, 92d Cong., 2d Sess. 188 (1972) (“Sec-

tion 505 closely follows the concepts utilized in . . . the Clean Air

Act. However, this legislation authorizes the courts to impose civil

penalties, as well as injunctive relief.”). Further support for this

view may be found in congressional references to citizen suit provi-

sions as a means of “abating” ongoing violations of the Act. See,

e.g., S. Rep. No. 414 at 79-82, reprinted in 1972 U.S. Code Cong. &

Admin. News at 3745-47.

% Plaintiffs and amici rely on the remarks of Senator Muskie, one

of the Act’s principal sponsors. Senator Muskie stated, in part,

that “[clitizen suits can be brought to enforce against both con-

tinuous and intermittent violations” and that

[the] 60-day provision was not intended .. . to cut off the

right of action a citizen may have to violations that took place

60 days earlier but which may not have been continuous. As in

the original Senate bill, a citizen has a right under section 505

to bring an action for an appropriate remedy in the case of any

person who is alleged to be, or to have been, in violation,

8a

There is, however, a more serious problem if the con-

cept of a present violation requires proof of its occurring

at the instant of suit. A violation may last only ten

minutes. Moreover, section 505(b)(1)(A) requires a

sixty-day notice before suit is brought, sd that even a

persistent violator may, temporarily, “clean up his act.”

We therefore think that the words “is . . . in violation”

should be sufficiently liberally construed to comport with

the injunctive purpose of the Act—conduct indicative of

continuing or renewed violations justifying an injunction,

as distinguished from matters over and apparently done

with, that would not warrant one. We find this possible

in the fact that the statutory phrase is not the three

words we have heretofore considered, but is “is alleged

to be in violation.” It is far less of a stretch to interpret

these words as applicable to a present continuing intent

than to take the Gwaltney court’s encompassing a single

past act. We would give the full phrase the practical

construction that is given to the $10,000 requirement for

jurisdiction in a diversity case. There jurisdiction is not

necessarily lost if, in the final analysis, a lesser sum is

involved; a reasonably held allegation is sufficient. See

St. Paul Mercury Indemnity Co. v. Red Cab Co., 303

U.S. 283, 288-89 (1938). We think the analogy excellent,

and that the same construction is warranted, not only

from the statutory wording, but also from its functional

purpose. If a defendant’s history of past violations is

such that it is reasonable to believe that misconduct will

continue, not only is it reasonable to allege a continuing

whether the violation be a continuous one, or an occasional or

sporadic one.

118 Cong. Rec. 33693, 33700 (1972). With due respect to Senator

Muskie, we do not think an ambiguity is to be created out of whole

cloth by his individual remarks. Moreover, the approach adopted in

this opinion addresses what appears to be one of the Senator’s

principal apprehensions—that if only “continuous” violations are

deemed to be covered under the Act, even persistent polluters may

utilize the notice provisions to avoid liability.

violation, but this is precisely the showing that would

induce a court to issue an injunction. See, e.g., SEC v.

Bonastia, 614 F.2d 908, 912 (3d Cir. 1980). Such a con-

struction corresponds both with the statutory language

and with the statutory purpose.‘

We accordingly hold that an action under 33 U.S.C.

$1365 may go forward if the citizen-plaintiff fairly al-

leges a continuing likelihood that the defendant, if not

enjoined, will again proceed to violate the Act. In review-

ing actions under this standard, the district court should

consider, among other things, the isolated or recurrent

nature of the infraction, the degree of scienter on the

part of the defendant, and the sincerity of its assurances

against future violations. Cf. Bonastia, 614 F.2d at 912.

We thus agree with the result in Hamker v. Diamond

Shamrock Chemical Corp., 756 F.2d 392 (5th Cir. 1985),

in which the court held the plaintiff’s allegation of a

single, past violation to be insufficient. We do not, how-

ever, agree with the reasoning which, apparently, led the

Louisiana district court, following the Hamker decision,

to dismiss a wumber of actions simply because no viola-

tions occurred on the dates the complaints were filed.

See Sierra Club v. Copolymer Rubber & Chemical Corp.,

621 F. Supp. 1013, 1015 (M.D. La. 1985). A plaintiff

who makes allegations warranting injunctive relief in

good faith, judged objectively, may recover a penalty

judgment for past violations even if the injunction proves

unobtainable.

In the case at bar, plaintiffs alleged violations of a

permit that limited defendant’s discharges of process

wastewater. At the time plaintiffs brought suit, however,

the defendant had ceased operating under this permit

because of its completion of a tie-in arrangement with a

municipal treatment facility. Under these circumstances,

*The Gwaltney court recognized this possible construction, but,

without comment, chose not to adopt it. See 791 F.2d at 308 n.9.

10a

there was no reasonable likelihood that defendant’s al-

leged infractions would continue, and the district court

correctly determined that the action should be dismissed.

Finally, there was no abuse of the court’s discretion

in denying plaintiffs’ August 1985 motion to amend their

complaint (a second time) to add a Clean Water Act

claim after the court had ordered dismissal. The new

incidents had been disclosed to plaintiffs long before they

had filed their motion. Furthermore, they apparently

concerned matters not even within the scope of section

505(a). Plaintiffs had been given much consideration,

and the court was well warranted in not reopening the

case.

Affirmed.