# Petition for Writ of Certiorari — Philadelphia Electric Co. v. Hercules Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1985
- **Citation:** 474 U.S. 980

## Text

ms ‘ | Supreme Court, U.S.
7 ao sate 7 t F ILED
SEP 18
No. JOSEPH F. SPANIOL, JR.
CLERK
IN THE »

SUPREME COURT OF THE UNITED STATES

October Term, 1985

PHILADELPHIA ELECTRIC COMPANY,
Petitioner-Appellant
v.

HERCULES INCORPORATED,
Respondent-A ppellee

and

GOULD, INC.

ON WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

PETITION FOR WRIT OF CERTIORARI

Patrick W. Kittredge, Esquire
Joseph M. Donley, Esquire

KITTREDGE, KAUFMAN & DONLEY
800 North American Building

121 South Broad Street
Philadelphia, PA 19107

(215) 732-2700

Counsel of Record for Petitioner

Robert Emmet Hernan, Esquire
Co-Counsel for Petitioner

PACKARD PRESS / LEGAL DIVISION, 10th & SPRING GARDEN STREETS, PHILA. PA. 19123 (215) 236-2000

18
ah wh

QUESTIONS PRESENTED FOR REVIEW ~

1. Does physical damage to Petitioner’s property
constitute an injury in fact and, therefore, satisfy the fed-
eral constitutional requirement of standing for Petitioner
to sue the party responsible for the damage?

2. Does physical damage to Petitioner’s property re-
sulting from pollution constitute a particularized harm of
a kind different from that suffered by members of the
public and, thus, give Petitioner a claim for relief under
public nuisance?

3. Does a present owner of land have the right to
sue, for indemnification, a former owner of the same
land who polluted the land, the groundwater beneath
and the Delaware River adjacent to the land, when the
present owner was required by law to abate tiie pollu-
tion?

PARTIES TO THE PROCEEDING BELOW

The petition to this Court for a writ of certiorari to the
United States Court of Appeals for the Third Circuit is
sou Tht by Philadelphia Electric Company, the plaintiff
before the District Court for the Eastern District of Penn-
sylvania and the appellee before the United States Court
of Appeals for the Third Circuit. Respondent Hercules
Incorporated was a defendant before the District Court,
and appellant before the Third Circuit Court. Gould, Inc.
was a defendant before the District Court.

TABLE OF CONTENTS

Page
QUESTIONS PRESENTED FOR REVIEW...... eA
PARTIES TO THE PROCEEDING BELOW...... ii
EE Re ea 1
Te 2
CONSTITUTIONAL PROVISIONS INVOLVED... 2
BRA eeEINE GOP EOEE CAGE 2... cess ccc c cence: 3
REASONS FOR GRANTING CERTIORARI...... 6

I. The Third Circuit Court Of Appeals Erred In
Holding That Petitioner Lacked Standing To

Maintain An Action For Public Nuisance.... 6
Il. Petitioner Has Stated A Claim For Relief Un-
Se ne ceaeesesasses 17

Ill. The Third Circuit Erred In Holding That Pe-
titioner PECO Is Not Entitled To Indemnifi-

cca nes uantesnce 22
EE 26
ee Go 27

APPENDIX (separately bound)

TABLE OF AUTHORITIES

Cases: Page
Akau v. Olomana Corporation, 65 Hawaii 383
CRED Ce ect cues aw eke These <x Santetenasaes 22

Association of Data Processing Service Organiza-
tions, Inc. v. Camp, 397 U.S. 150 (1970). ... 6, 10

Baker v. Carr, 369 U.S. 186 (1962)............ 9,15
Barlow v. Collins, 397 U.S. 159 (1970). .......... 10
Bell v. Hood, 327 U.S. 678 (1946) ............... 15
Builders Supply Co. v. McCabe, 366 Pa. 322, 77 A.2d
PREC a ok tava cunts coneethateVeanses 23

Burgess v. M/V Tamano, 370 F. Supp. 247 (D.Me.
1973), affd., 559 F.2d 1200 (1st Cir. 1977)... 19,

20, 21
County Court of Ulster County v. Allen, 442 U.S.
by BRU ape i at Mier eerie eee 9
Flast v. Cohen, 392 U.S. 83 (1968) .............. 8,9
Frady v. Portland General Electric Cc., 637 P.2d
ee as HE UES ocak uw cesiswdacebinn 22
Frothingham v. Mellon, 262 U.S. 447 (1923) ..... 9

Heinl v. Pecher, 330 Pa. 232, 198 A. 797 (1938) .. 22
McCarney v. Ford Motor Company, 657 F.2d 230

ac hc eho e cc ck Ueki oaks oun 15, 16
Mixter v. Mack Trucks, Inc., 224 Pa. Super. 313,
Me PE OUPOED. 4 ov cc nsavsccuckcasaawas 23

\National Wood Preservers, Inc. v. Commonwealth
Department of Environmental Resources, 489

Pe Bee. ee CU Oe CI hh vin Ne Kacewn cucu 24
Schlesinger v. Reservists Committee to Stop the
rey, GE SiG, Bee CETUA 5 sass cacuskss 8, 10, 18

iv

TABLE OF AUTHORITIES—(Continued )

Cases: Page
Sierra Club v. Morton, 405 U.S. 727 (1972)...... 10

Tennessee Electric Power Company v. TVA, 306
6 Be 3) ee reer ere rere 9
Tileston v. Ullman, 318 U.S. 44 (1943) .......... 8
United States v. Richardson, 418 U.S. 166 (1974). 8,
10, 18

Valley Forge Christian College v. Americans United
for Separation of Church and State, Inc., 454
ee Te PeeT ee ere err ere 6

Village of Arlington Heights v. Metropolitan Hous-
ing Development Corporation, 429 U.S. 252

1 Serre er ee eee ere 7, 10
Warth v. Seldin, 422 U.S. 490 (1975)........ 7, 8, 16
Constitution:

Sh a I: Fs aka cceecackauacaeeaeenee 2,7
Statutes:
Clean Streams Law, 35 Pa.C.S.A. § 691.1, et seq.

i. 8 gg re ee 4, 22, 23, 24
Miscellaneous:

Wright, The Law of Federal Courts, § 13 (4th ed.

ER ee ae ee ee ede 7, 10, 11, 15

Restatement (Second) of Torts, § 821C (1965). 17, 18

Prosser, Private Action for Public Nuisance, 52

We Rie ee Cee av CA ea dew ew ees 18, 22
Prosser and Keeton on Torts § 90 (5th ed. 1984).. 18
Restatement of Restitution §§ 95, 96 (1937)...... 23

Case No.

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1985

PHILADELPHIA ELECTRIC COMPANY,
Petitioner-Appellant
v.

HERCULES INCORPORATED,
Respondeni-aAppeliee

and
GOULD, INC.

ON WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

PETITION FOR WRIT OF CERTIORARI

OPINIONS BELOW

The opinion of the District Court for the Eastern Dis-
trict of Pennsylvania, denying Respondent’s Post-Trial
Motions, is reported at 587 F. Supp. 144 (E.D.Pa. 1984)
and is set forth in the Appendix, at 33, for this Court's
convenience.

The opinion of the Court of Appeals for the Third
Circuit is reported at 762 F.2d 303 (3d Cir. 1985) and is

1

2

set forth in the Appendix, at 1, for this Court’s conve-
nience.

JURISDICTION

The judgment of the Court of Appeals for the Third
Circuit was entered on May 28, 1985. Petitioner Phila-
delphia Electric Company timely filed a petition for re-
hearing, which petition was denied on June 21, 1985.
The jurisdiction of this Court is invoked pursuant to 28
U.S.C. §1254(1).

CONSTITUTIONAL PROVISIONS INVOLVED

This case involves, in part, an interpretation of Ar-
ticle III, Section 2 of the United States Constitution
which provides, in relevant part, that:

The judicial Power shall extend to all Cases, in Law
and Equity, arising under this Constitution, the
Laws of the United States, and Treaties made, or
which shall be made, under their Authority; — to all
Cases affecting Ambassadors, other public Ministers
and Consuls; — to all Cases of admiralty and mari-
time Jurisdiction; — to Controversies to which the
United States shall be a Party; — to Controversies
between two or more States; — between a State and
Citizens of another State; — between Citizens of dif-
ferent States; — between Citizens of the same State
claiming Lands under Grants of different States, and
between a State, or the Citizens thereof, and foreign
States, Citizens or Subjects.

3

STATEMENT OF THE CASE

This lawsuit resulted from the pollution of a certain
parcel of property located in Chester, Pennsylvania. In
the years from 1945 to 1971 Pennsylvania Industrial
Chemical Corporation (“PICCO”) operated a synthetic
hydrocarbon resin manufacturing and processing plant
on the property in Chester, Pennsylvania (“Chester
site”). The property lay adjacent to the Delaware River
and at the time PICCO acquired the Chester site an inlet
was located at the south end of the Chester site which
opened into the Delaware River. Sometime after acquir-
ing the Chester site, but during the period of time when
PICCO conducted its resin manufacturing operation at
the Chester site, PICCO filled in the shoreline at or about
the inlet, thereby creating a lagoon or lake (“PICCO
Lake”); PICCO also filled in other low lying areas on the
property. During the course of its ownership and control
of the Chester site, PICCO buried, depusited or placed
resins, resin-laden materials and/or other by-products
and chemicals used in its operation in the PICCO Lake
and in various locations about the Chester property.

In 1971 PICCO ceased its operations at the Chester
site and sold the property to Gould, Inc. (“Gould”). Gould
did not conduct any operations at the Chester facility,
other than leasing certain tanks to ABM Disposal Ser-
vices Company (“ABM”). ABM did not store or dispose of
resins or resinous by-products at the Chester site. In
1974 Gould sold the Chester site to Petitioner Philadel-
phia Electric Company (“PECO”). PECO has owned the
property since 1974, and while PECO has leased sec-
tions of the property to third parties,' it has not under-
taken any operations on the site.

In 1972, Hercules Incorporated (“Hercules”) ac-
quired PICCO, including PICCO’s operations in West-
ern Pennsylvania and Louisiana. As part of the

1. None of these third parties conducted resin manufacturing
or storage operations.

4

acquisition of PiCCO, Hercules expressly assumed “ail
of the debts, obligations and liabilities of PICCO,” with
certain exceptions not applicable to the instant claim.

Then, in 1980, the Pennsylvania Department of En-
vironmental Resources (“DER”) discovered that resin-
ous materials were leaching from the banks of the
Delaware River at the Chester site, and that the PICCO
Lake was contaminated with resinous materials. On Au-
gust 22, 1980, DER issued a citation against PECO, as
owner of the property, for violation of the Pennsylvania
Clean Streams Law, 35 Pa.C.S.A. §691.01 (Purdon
1977). The citation required PECO to abate the polluting
condition at the Chester site, including the pumping of
the PICCO Lake and the removal of soil contaminated by
the resinous materials. After further investigation by
PECO and DER, PECO removed the resinous materials
from the site at a cost in excess of $340,000.00.

Thereafter, PECO instituted a Complaint against
Hercules? alleging that the contamination caused by
PICCO, in dumping its resinous materials, had polluted
PECO’s property, including the soils at the property; that
the contamination continued to pollute the groundwater
underneath the Chester site and had leached onto the
banks of and into the Delaware River; and that PECO
had been required by DER to abate the pollution. Juris-
diction was founded on diversity of citizenship.

Prior to trial and pursuant to Cross-Motions for Sum-
mary Judgment on the issue of Hercules’ liability for
PICCO’s actions, the District Court held that Hercules
had expressly assumed PICCO’s liabilities and that
Hercules’ acquisition of PICCO constituted a de facto
merger, which also imposed liability upon Hercules for
PICCO’s conduct.

2. PECO also sued Gould, Inc., from whom it purchased the
property, on the ground that Gould had failed to disclose the latent
contamination. Prior to trial, and as a result of the discovery process,
PECO determined its case against Gould was quite weak and settled
with Gould for a nominal sum.

5

A jury trial commenced on June 29, 1983 and en-
compassed three days. During the course of that trial,
PECO submitted expert evidence which virtually
“fingerprinted” the pollutants found on the site as
PICCO products. At the conclusion of the trial, the jury
found, by Special Interrogatories, that PICCO caused
the contamination of the Chester site and that the con-
tamination was continuing to pollute the groundwater or
the Delaware River (Appendix, at 57). Based on the
jury’s answers to the Special Interrogatories, the Court
then entered a judgment against Hercules for the clean-
up costs of $345,906.69, together with delay damages as
provided by Pennsylvania Rule of Civil Procedure 238,
and the Court required Hercules to abate the continuing
contamination found by the jury to be present on and
about the Chester site.

Hercules filed a Motion for Judgment Notwithstand-
ing the Verdict or, In the Alternative, for a New Trial, on
various grounds, including that the District Court had
erred in holding Hercules liable for the conduct of
PICCO, and that PECO had failed to state a claim for
relief for private or public nuisance. The District Court
denied Hercules’ Post-Trial Motions and Hercules ap-
pealed to the Third Circuit Court of Appeals (Appendix,
at 33).

On May 28, 1985, the Third Circuit Court of Appeals
affirmed the District Court’s determination that
Hercules had expressly assumed the liabilities of PICCO
and, additionally, that the acquisition of PiCCO by
Hercules constituted a de facto merger, thereby impos-
ing liability on Hercules for the contamination caused by
its predecessor in interest, PICCO. However, the Third
Circuit Court of Appeals also held that PECO failed to
state or prove a claim for relief for private nuisance, that
PECO had no standing to sue for relief under public nui-
sance, and that PECO was not entitled to relief for in-
demnification (Appendix, at 16-31).

6

PECO timely filed a Petition for Rehearing in Banc
with the Third Circuit on the grounds that PECO did
have standing to maintain an action for public nuisance
and that PECO was entitled to indemnification from
Hercules. On June 21, 1985, the Third Circuit Court of
Appeals denied PECO’s Petition for Rehearing (Appen-
dix, at 55).

REASONS FOR GRANTING CERTIORARI

I. The Third Circuit Court Of Appeals Erred In Holding
That Petitioner Lacked Standing To Maintain An
Action For Public Nuisance

The Third Circuit Court of Appeals’ decision in this
_ case contravenes the well-established rulings of the Su-
preme Court on the fundamental, federal constitutional
issue of standing. Regardless of what uncertainties exist
at the boundaries of the issue of standing, this Court has
never waivered from the central position that a plaintiff
which alleges an “actual injury” satisfies the constitu-
tional mandate that a federal court exercise its power
only over a “case” or “controversy.” Valley Forge Chris-
tian College v. Americans United for Separation of
Church and State, Inc., 454 U.S. 464 (1982); Associa-
tion of Data Processing Service Organizations, Inc. v.
Camp, 397 U.S. 150 (1970). Yet, the Third Circuit has
held otherwise.

The Third Circuit found, in the instant case, that the
owner of a property polluted by chemicals has no stand-
ing to sue, for damages and injunctive relief, the former
owner of the property which caused the pollution, de-
spite the uncontroverted facts that the property itself, the
groundwater and an adjacent river were damaged by the
pollution, the present owner spent over $340,000 to
abate the pollution, and the pollution was continuing to
cause damage. This unprecedented ruling by the Third
Circuit turns the standing requirement on its head and
is violative of Petitioner’s federal constitutional right to

7

prosecute its claim in the federal courts. Moreover, the
Third Circuit’s ruling that Petitioner PECO had no
standing to sue for a public nuisance neither estops, nor
bars, Petitioner from relitigating its claims against
Hercules, since such a ruling does not constitute a de-
cision on the merits of Petitioner’s claims. This Supreme
Court, in its supervisory role, cannot permit such uncer-
tainty to prevail in the Circuit Courts.

The question as to standing is required by the
United States Constitution, Article III, Section 2, limi-
tation which restricts federal court jurisdiction only to
“cases” or “controversies.” Whether a plaintiff will be ac-
corded standing to litigate its claim in a federal court de-
pends upon whether the plaintiff has “ ‘alleged such a
personal stake in the outcome of the controversy’ as to
warrant [its] invocation of federal-court jurisdiction and
to justify exercise of the court’s remedial powers on [its]
behalf.” Warth v. Seldin, 422 U.S. 490, 498-99 (1975),
citing Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 7
L.Ed. 663 (1962).

Moreover, since standing is an element of the federal
constitutional concept of “case” and “controversy,” “the
federal courts must reach their own decisions without
regard to what the state law in point may be.” WRIGHT,
THE LAW OF FEDERAL COURTS, §13 at 60 (4th ed.
1983). As Justice Powell noted in Village of Arlington
Heights v. Metropolitan Housing Development Corpora-
tion, 429 U.S. 252 (1977): “|s]tate law of standing, how-
ever, does not govern such determinations in the federal
courts. The constitutional and prudential considerations
canvassed at length in Warth v. Seldin ... respond io
concerns that are peculiarly federal in nature.” 429 U.S.
at 262, n. 8 (citation omitted).

While this Supreme Court has applied “prudential”
lirnits on who may invoke federal jurisdiction, in addition
to the Article III constitutional mandate of a “personal
stake in the outcome of the controversy,” such limits
have been applied only in two particular and narrowly

8

defined circumstances, neither of which is applicable to
the instant case. First, a plaintiff may be precluded from
litigating a claim in federal court if the asserted harm is
in the nature of a generalized grievance shared in sub-
stantially equal measure by all or a large class of citizens
because of the necessarily abstract nature of the injury
all citizens share.? Thus, in Schlesinger v. Reservists
Committee to Stop the War, 418 U.S. 208 (1974), a Com-
mittee of Reservists and five individuals were held not to
have standing to claim that armed forces reserve mem-
berships of members of Congress violated the incompat-
ibility clause of the Constitution because, as citizens,
their claim involved only the generalized interest of all
citizens and, thus, their claim constituted a mere ab-
stract injury rather than a concrete injury. In addition, as
taxpayers, thcir claims failed to satisfy the demands of
Flast v. Cohen, 392 U.S. 83 (1968). See also United
States v. Richardson, 418 U.S. 166 (1974). Second, a
plaintiff may be precluded from federal court litigation if
such plaintiff attempts to assert the legal rights or inter-
ests of third parties. See, e.g., Tileston v. Ullman, 318
U.S. 44 (1943).

As indicated by this Court in Warth v. Seldin, supra,
these “prudential” limitations, above and beyond the
constitutional requirement, have been judicially im-
posed out of concern that:

[w]ithout such limitations — closely related to
Art. III concerns but essentially matters of judi-
cial self-governance — the courts would be
called upon to decide abstract questions of wide

3. While it will be seen later that the language of this analysis
is superficially similar to the analysis of the merits of Petitioner’s
claim under publi nuisance, and that this superficial similarity may
have led the Third Circuit astray, the requirements of standing are
federal in r.ature while the requirements of a claim for public nui-
sance are state-law dcierminative. And in the difference therein
hangs the Third Circuit’s self-created confusion.

9

public significance even though other govern-
mental institutions may be more competent to
address the questions and even though judicial
intervention may be unnecessary to protect in-
dividual rights.

422 U.S. at 500. Such concerns derive from the federal
judiciary’s reluctance to intrude into areas of public in-
terests more properly the province of the legislative or
executive branches of government. County Court of Ul-
ster County v. Allen, 442 U.S. 140 (1979).

In the instant case, which involves a dispute be-
tween private parties over a concrete injury to private
property, such concerns are irrelevant. Thus, the
“prudential” limitations imposed on the issue of standing
are not implicated by the facts of the instant case, and so
this Supreme Court need only consider whether Peti-
tioner has satisfied the constitutional requirement of
standing.

Standing, in the constitutional sense, is “an aspect of
justiciability . . . surrounded by the same complexities
and vagaries that inhere in justiciability.” Flast v. Cohen,
392 U.S. at 98. And since the issue of justiciability goes
to the heart of a federal court’s existence, i.e. its power to
hear cases, the constitutional dimension of the issue, and
its articulation, has ebbed and flowed to some extent
with the historical tides of a federal court’s power vis-a-
vis the legislative and executive branches of govern-
ment. Thus, in the period prior to the 1960s a restrictive
view of standing prevailed and a “direct injury” or “legal
right” standard applied. See, e.g., Tennessee Electric
Power Company v. TVA, 306 U.S. 118 (1930);
Frothingham v. Mellon, 262 U.S. 447 (1923). During the
1960s, a line of cases expanded the notion of standing
and, therefore, access to federal courts, so long as a plain-
tiff could show “injury in fact”, or a personal stake in the
outcome of the controversy in order to assure a concrete
adverseness. See, e.g., Flast v. Cohen, supra; Baker v.

10

Carr, 369 U.S. 186 (1962). As the doctrine of standing
evolved, private parties were also granted standing to
contest federal administrative actions so long as they suf-
fered an “injury in fact” as a result of the challenged
action and their interest was within the zone of interests
to be protected or regulated by the statute or constitu-
tional guarantee in question. See, e.g., Sierra Club v.
Morton, 405 U.S. 727 (1972); Association of Data Pro-
cessing Service Organizations, Inc. v. Camp, supra;
Barlow v. Collins, 397 U.S. 159 (1970). But also, in the
1970s, and continuing into the present decade, a con-
traction of standing has occurred. See, e.g., United States
v. Richardson, supra; Schlesinger v. Reservists Commit-
tee to Stop the War, supra. These cases, “building
heavily on a renewed emphasis on separation of powers
principles, make it clear that a direct injury, and not
merely a general interest common to all members of the
public, is required for standing.” WRIGHT, LAW OF
FEDERAL COURTS, §13, at 67 (4th ed. 1983).

In spite of the complexities and vagaries which may
exist at the borders of the doctrine of standing, the cen-
tral theme of the doctrine of standing has remained
fixed: A plaintiff which has suffered an injury in fact, is
accorded standing by the federal constitution to seek re-
dress in a federal court. Or, in perhaps the clearest and
most succinct articulation of the constitutional standard,
“(t]he plaintiff must show that he himself is injured by
the challenged action of the defendan:.” Village of
Arlington Heights v. Metropolitan Housing Develop-
ment Corporation, 429 U.S. 252 (1977).

When private plaintiffs assert a right to contest a fed-
eral statute or federal administrative agency action, such
plaintiffs must demonstrate their interest in, and the ef-
fect on them of such statute or action in order to satisfy
the standing requirement. But, when the claims before
the federal court are asserted by one private party against
another private party for damages to private property re-
sulting from, and for injunctive relief against, the

11

defendant’s conduct, the issue of standing is rarely ad-
dressed because standing to bring the lawsuit is
uncontrovertible:

[t]he law of standing is almost exclusively con-
cerned with such public law questions as deter-
minations of constitutionality and review of
administrative or other governmental action. In
theory, of course, it is not so limited. The person
suing for breach of contract or for a tort must
satisfy the court that he has standing to bring
such a suit, but in practice such suits are
brought only by a person harmed by the sup-
posed wrong and his standing to sue is
self-evident.

WRIGHT, LAW OF FEDERAL COURTS, §13, at 60
(4th ed. 1983). Yet, the holding by the Third Circuit
Court of Appeals in the instant case certainly distorts and
confuses what otherwise was a clear corollary of the doc-
trine of standing in the federal courts.

The Third Circuit has held in effect in this case that
even if a private party plaintiff alleges, and proves, that it
has suffered monetary damages, in excess of $340,000,
as a result of the private defendant’s conduct, neverthe-
less such a plaintiff has no constitutional right to stand
in federal court to seek redress of its complaints. On its
face, such a holding destroys the axis around which the
doctrine of standing turns. It is a holding which violates
Petitioner’s rights under the federal constitution, and it
flies in the face of every decision on standing enunciated
by the Supreme Court. ;

Even looking beyond the face of the decision, the
holding cannot withstand constitutional scrutiny as a
simple recital of the pertinent facts of the case reveais.
Petitioner owned land in Chester, Pennsylvania which
land bordered the Delaware River. In 1980 it was dis-
covered that the land (private property), the groundwa-
ter beneath the land and the Delaware River adjacent to

12

the land (public property) had been contaminated as a
result of the industrial practices of a former owner of the
land. Petitioner attempted to abate the pollution, at a cost
in excess of $340,000, and pursuant to the express re-
quirements of Pennsylvania law and at the direction of
the Pennsylvania Department of Environmental Re-
sources. Petitioner then brought the instant lawsuit
against Respondent, the party responsible for the pollu-
tion, claiming that Respondent’s conduct constituted a
private and/or public nuisance.

A jury found that Respondent was responsible for
the pollution of Petitioner’s property and that, indeed, the
pollution was continuing to contaminate the groundwa-
ter beneath the property or the Delaware River adjacent
to the property. See Jury Answers to Special Interroga-
tories, Appendix, at 57. The District Court entered judg-
ment on the jury’s verdict and ordered Respondent to
abate the continuing pollution. Respondent then filed
Post-Trial Motions with the District Court on the
grounds, in part, that Respondent had not assumed the
liabilities of PICCO, and that Petitioner had failed to state
a claim for relief for private or public nuisance. The Dis-
trict Court denied Respondent’s Post-Trial Motions (Ap-
pendix, at 33).

On appeal the Third Circuit affirmed the District
Court’s ruling that Respondent was responsible, as a
successor corporation, for the acts of PICCO, the polluter
‘Appendix, at 8-16). The Third Circuit also hel’ that Pe-
titioner had failed to plead, or prove, a cause of action in
private nuisance (Appendix, at 16-22).

The Third Circuit then turned its consideration to —

Petitioner’s public nuisance theory of recovery and pos-
ited: “[t]he question before us is whether PECO has
standing to bring an individual action for damages or
injunctive relief for interference with a public right.”
(Appendix, at 24, emphasis added).

The Court’s answer to the question can be formu-
lated, in summary fashion, as follows:

swe

13

[tlo recover for public nuisance a party must
have been exercising a right common to the
public, which right was interfered with by
Respondent’s conduct.

Petitioner was not actually using the Delaware
River, the use of which waters constituted the
public right.

Therefore, Petitioner had no standing to sue Re-
spondent.

Nowhere in this implied syllogism nor in the expo-
sition of the Third Circuit’s holding is there any consid-
eration of whether Petitioner suffered an injury in fact,
or satisfied any other standard for determining whether
Petitioner fulfilled the constitutional requirement of
standing. Nevertheless, at the beginning of its discus-
sion in regard to the public nuisance issue, the Circuit
Court contended that the issue depends on whether Pe-
titioner had standing, and at the end of its discussion the
Court held that Petitioner “lacks standing” (Appendix, at
25).

Petitioner respectfully submits that the Third Circuit
could not have meant what it said in regard to
Petitioner’s standing to bring a claim for public nui-
sance. Rather than addressing the issue of standing, as
the Circuit Court claimed, it seems that the Third Circuit
was attempting to address the merits of Petitioner’s claim
for public nuisance. It can be postulated only that the
Circuit Court intended to hold that Petitioner had failed
to allege or prove one element of a cause of action in
public nuisance. This is the only sensible interpretation
of the Circuit Court’s analysis and opinion. The Circuit
Court reasoned that to recover under a public nuisance
claim, Petitioner must have suffered harm of a kind dif-
ferent from that suffered by other members of the public —
“exercising the right common to the general public that
was the subject of interference.” The Court then found

14

that the public right at issue was the right to “pure
water,” and Petitioner did not aliege that “it used the wa-
ters of the Delaware River itself, or that it was directly
harmed in any way by the pollution of those waters” (Ap-
pendix, at 24-25).4 Rather, the Circuit Court found, in a
display of convoluted logic, that the contamination of
Petitioner’s property was the cause of the pollution of the
Delaware River, not the result of the pollution, and Pe-
titioner was “harmed only in the exercise of its private
property rights over the Chester site” (Appendix, at 25).
Therefore, the Court held that Petitioner “lacks standing
to sue for public nuisance” (Appendix, at 25; emphasis
added).

Thus, the Circuit Court took Petitioner’s claim for
public nuisance and erroneously held that Petitioner
lacked standing to sue, when it presumably intended to
dispose of Petitioner’s claim on the merits, i.e. failure to
state a claim for public nuisance. Such error by the Third
Circuit is neither a mere slip of the pen, nor harmless.
Such error is reversible.

There can be no question that Petitioner has alleged
and proven that it suffered an actual, concrete injury in
fact sufficient to satisfy the federal constitutional re-
quirement of standing. Therefore, the Third Circuit's de-
cision must be reversed as it violates Petitioner’s federal
constitutional rights. If the error is not reversed, it not
only violates individual Petitioner’s rights, it also threat-
ens to wreak havoc on the federal court system.

For if the Third Circuit, or any other Circuit Court,
is permitted to deny plaintiff an entitlement to relief, af-
ter a full trial on the merits, on the ground of lack of
standing, when the Court presumably meant to dispose
of the case on the merits, then the Circuit Court thereby

4. The Third Circuit completely ignored the allegation and
uncontradicted proof that the pollution caused by Respondent
harmed Petitioner’s property, namely the soils at the property, and
contaminated the public groundwater beneath Petitioner's property.
See District Court Opinion, Appendix, at 33.

15

destroys the finality to the case and reopens the case for
further litigation. For denial of relief on the ground of
standing does not reach the merits of the case, and there-
fore, does not serve to bar a relitigation of the same dis-
pute.

“For it is well settled that the failure to state a proper
cause of action calls for a judgment on the merits and not
for a dismissal for want of jurisdiction.” Bell v. Hood, 327
U.S. 678 (1946); see also Baker v. Carr, supra. It is
equally well settled that dismissal of an action for lack of
standing does not call for a judgment on the merits and
therefore does not act as a bar to a later suit, on the very
same facts. WRIGHT, LAW OF FEDERAL COURTS,
§13, at 67-68 (4th ed. 1983).

For instance, in McCarney v. Ford Motor Company,
657 F.2d 230 (8th Cir. 1981), a former automobile dealer
sued an automobile manufacturer claiming that the
manufacturer had forced the former dealer to sell his
dealership at a low pitce by harassing and unfairly treat-
ing the former dealer. In an earlier case, the former
dealer claimed that defendant manufacturer, through a
campaign of harassment and unfair dealing, compelled
the dealer to sell his dealership, which sale allegedly was
at an unfavorable price. In that earlier case the former
dealer filed suit in federal court claiming violation of the
Automobile Dealers’ Day in Court Act, 15 U.S.C. §1221
et seq., and the District Court had granted Defendant’s
motion for summary judgment on the ground that the
former dealer, as an individual, lacked standing under
the federal statute.

The former dealer did not appeal the first case, but
instead filed a second action claiming entitlement to re-
lief, upon the same facts, under the Sherman Act; a state
statute prohibiting termination of a supply contract with-
out good cause; wrongful termination; breach of fidu-
ciary duty; and wrongful interference with a contract.

In the second action, the defendant manufacturer
was granted summary judgment by the District Court,

16 :

on the grounds of res judicata and collateral estoppel be-
cause of the dismissal of the earlier case brought by the
same plaintiff against the same defendant. On review,
the Eighth Circuit Court defined the issue as follows:
“It]he case presents the difficult but narrow issue of
whether a dismissal for lack of standing to invoke a par-
ticular statute can act as a bar to a later suit based upon
the same factual allegations.” 657 F.2d at 231. The Cir-
cuit Court held that it did not, and reversed and re-
manded the case.

In so ruling, the Eighth Circuit found that the Dis-
trict Court’s holding in the first case was somewhat am-
biguous in that the District Court mixed its analysis of
lack of standing and failure to state a claim upon which
relief could be granted, but nevertheless, the Eighth Cir-
cuit Court concluded that in the original District Court
decision, “the judgment was based upon lack of standing
and not that the plaintiff failed to state a claim upon
which relief could be granted.” 657 F.2d at 232, n. 4.

The Eighth Circuit went on to reason that, “[t]he
Supreme Court has expressly delineated a distinction be-
tween the issue of standing and the merits of a particular
lawsuit.” 657 F.2d at 232-233, relying on Warth v.
Seldin, 422 U.S. 490 (1975). The Circuit Court then
held:

|wle hold, therefore, that a dismissal based upon
a lack of standing is not ‘on the merits’ of the
underlying substantive claim and is not a bar to
asserting another theory of relief based upon the
same operative facts assuming the other ele-
ments of claim preclusion are satisfied.

657 F.2d at 234.

The Third Circuit in the instant case has committed
the very same error #, the District Court in the first Mc-
Carney case: it has confused the issue of standing with
that of whether there was a failure to state a claim for

17

relief. This Supreme Court must not allow such confu-
sion to\exist in the Third Circuit, or any other Circuit,
because to do so would reopen the courtroom door to law-
suits that otherwise should be barred. Nor is such error
harmless as to Petitioner. As more tully discussed in the
following section, if the Third Circuit Court of Appeals
had analyzed the issue in terms of whether Petitioner
had stated a claim for relief for public nuisance instead
of confusingly determining that Petitioner lacked stand-
ing to sue, then it is submitted the result of the Circuit
Court’s decision would have been quite different.

Therefore, Petitioner respectfully requests that its
Petition for Certiorari be granted and, after full consid-
eration by this Court, that the judgment of the Third Cir-
cuit be reversed.

II. Petitioner Has Stated And Proven A Claim For Relief
Under Public Nuisance

If the Third Circuit Court nad not been confused and
had clearly examined and analyzed whether Petitioner
had stated and proven a claim for relief under public nui-
sance, then the Third Circuit undoubtedly would have
reached a different result. Under the iaw of public nui-
sance a plaintiff must only prove “particular” damages
from the alleged wrong, and physical harm to a plaintiff's
land has always been held to be such particularized
harm. Restatement (Second) of Torts, §821 C. In the in-
stant case, Petitioner PECO most assuredly alleged and
proved physical harm to its land as a result of the public
nuisance for which Respondent was held liable. Yet the
Third Circuit has confused this requirement with the
constitutional requirement that a party must have stand-
ing to sue in federal court.

Petitioner respectfully posits that the confusion re-
sulting in the Third Circuit’s decision is as follows:
standing focuses on the party seeking to get his com-
plaint before the federal court, rather than on the issue

18

the party seeks to nave adjudicated. Schlesinger v. Re-
servists Committee to Stop the War, supra. A claim for
public nuisance is, of course, the issue to be adjudicated
in the instant case.

In analyzing for the presence of standing, the federal
court must examine whether the impact on the plaintiff
of the action or statute is plainly undifferentiated and
common to all members of the public. If it is, then plain-
tiff has net alleged “some particularized injury that sets
him apart from the man in the street.” United States v.
Richardson, 418 U.S. at 2955 (Powell, J., concurring).
And plaintiff would have no standing because plaintiff
has alleged or proven only an abstract dispute.

In analyzing a public nuisance claim on its merits,
the plaintiff must plead, and prove, a particular damage,
different in kind and degree from that suffered by the
general public. Restatement (Second) of Torts §821C.
The requirement of demonstrating “particular” damage
was intended to limit access in the courts for complaints
about public matters, in as much as complaints about
public matters were the sole and proper province of duly-
constituted public officials. See PROSSER, Private Ac-
tion for Public Nuisance, 52 Va.L.Rev. 997 (1966).
However, physical injury or property damage have al-
ways been deemed damages “particular” enough to sat-
isfy a claim for relief under public nuisance. PROSSER
AND KEETON ON TORTS, §90, at 648 (5th ed. 1984);
PROSSER, Private Action for Public Nuisance, 52
Va.L.Rev. 997, 1011-12 (1966). Later, the scope of re-
covery for public nuisance was broadened to allow re-
covery so long as the plaintiff's damages were different in
kind and degree from those suffered by the general pub-
lic and such damages were suffered while the injured
party was exercising a right common to the general pub-
lic. Restatement (Second) of Torts, §821C; PROSSER,
supra.

19

A paradigm of the boundaries that constitute “par-
ticular damage” suffered by one exercising rights com-
mon to the public is found in the case of Burgess v. M/V
Tamano, 370 F. Supp. 247 (D.Me. 1973), affd, 559 F.2d
1200 (1st Cir. 1977) (see Appendix, at 23, n. 11). In Bur-
gess, plaintiffs, in class actions, sought recovery for dam-
ages incurred as a result of the discharge of
approximately 100,000 gallons of oil from a tanker, the
M/V Tamano, into the waters of Casco Bay in Maine.
Defendants were the ship, owners, captain, pilot and lo-
cal pilots’ association, as well as the charterer, the State
of Maine and the United States. Liability was asserted on
theories of negligence, unseaworthiness, trespass and
nuisance, as well as under the Rivers and Harbors Act of
1899, 33 U.S.C. §407 and Water Quality Improvement
Act of 1970, 33 U.S.C. §1161(b)(2). However, the Court
noted that: “[pjlaintiffs’ principal claims sound in nui-
sance, and, although they also assert claims based on
negligence, unseaworthiness, trespass and statutory vi-
olations, it is not suggested that their right to recover
damages for pecuniary losses sustained by them as a re-
sult of the spill may differ according to the theory upon
which they predicate defendants’ liability.” 370 F. Supp.
at 250, n. 2. Thus, the Court analyzed the clairns under
a public nuisance theory.

Defendants filed motions to dismiss the claims of
three of the plaintiff classes: the commercial fishermen;
the commercial clam diggers; and the owners of the mo-
tels, trailer parks, camp grounds, restaurants, grocery
stores and similar businesses which depended on the
tourist trade and which were adversely affected by the oil
spill. Defendants contended that economic loss, includ-
ing ioss of profits and impairment of earning capacity,
were not legally cognizable damages, under a theory o.
public nuisance, among other theories, because none of
the plaintiffs in question had any property interest in the

20

waters or marine life or shores claimed to have been pol-
luted. The District Court held that, “the motions to dis-
miss the claims of the commercial fishermen and clam
diggers must be denied, but that the motions to dismiss
the claims of the . . . businessmen, other than those who
owned shore property physically injured by the spill,
must be granted.” 370 F. Supp. at 249 (emphasis added).

The District Court differentiated the commercial
fishermen and clam diggers, on one hand, from the busi-
nessmen, on the other hand, as follows:

[t]he commercial fisherman and clam diggers in
the present cases clearly have a special interest,
quite apart from that of the public generally, to
take fish and harvest clams from the coastal wa-
ters of the State of Maine. The injury of which
they complain has resulted from defendants’ al-
leged interference with their direct exercise of
the public right to fish and to dig clams.

370 F. Supp. at 250.
On the other hand, the business owners:

do not assert any interference with their direct
exercise of a public right. They complain only of
loss of customers indirectly resulting from al-
leged pollution of the coastal waters and beaches
in which they do not have a property interest.
Although in some instances their damage may
be greater in degree, the injury of which they
complain, which is derivative from that of the
public at large, is common to all busimesses and
residents of the . . . [affected] area.

370 F. Supp. at 251 (emphasis added).

The line drawn by the District Court is such that those
parties which were directly affected by the pollution can
recover but not those parties only indirectly affected. In
the former category are those whe owned shore property

21

physically injured by the spill as well as commercial fish-
ermen and clam diggers; in the latter category are those
who suffered indirect business losses from the spill.

The Court’s emphasis on the fact that the commer-
cial fishermen and clam diggers were actually and di-
rectly exercising the use of the right to fish and to dig
clams was necessary to set them apart from the tourist-
trade businessmen because traditionally only one whose
property was damaged would recover and the fishermen
and clam diggers had no proprietary interest in the pub-
lic waters.

What remains clear in the District Court’s reasoning
is that it is uncontested that one whose property was
damaged can recover for public nuisance, irrespective of
whether the property owner was exercising rights com-
mon to the public.

In the instant case, Petitioner PECO proved that its
property was damaged, to the extent that Petitioner in-
curred over $340,000 in costs to remove contaminated
soil from the property, and that the public groundwater
beneath the Delaware River adjacent to Petitioner’s
property was also polluted by PICCO’s operations. Even
the Third Circuit Court of Appeals did not contest the
fact that a public nuisance was created by PICCO, and
that Respondent Hercules was liable for PICCO’s ac-
tions. ‘Appendix, at 8-16). Yet, the Third Circuit erro-
neously reasoned that Petitioner PECO did not have
standing because it was not exercising the right to use
the public waters of the Delaware River, unlike the com-
mercial fishermen in the Burgess case, and, therefore,
PECO could not maintain an action for public nuisance.
Thus arises the Third Circuit’s confusion of federal
standing requirements and the elements which must be
satisfied in order to recover for public nuisance.

This result is contrary to the uncontested rule of law
that if an owner of property suffers damage to that prop-
erty as a result of a nuisance which also affects public
rights, then the property owner is entitled to maintain an

22

action for public nuisance. See, e.g., Heinl v. Pecher, 330
Pa. 232, 198 A. 797(1938); Akau v. Olomana Corpora-
tion, 65 Hawaii 383 (1921); Frady v. Portland General
Electric Co., 637 P.2d 1345 (Or.App. 1981); Prosser, Pri-
vate Action for Public Nuisance, 52 Va.L.Rev. 997, 1018
(1966). Only if the claimant has not suffered property
damage, or personal injury, is it necessary to determine
if the damage which is alleged was of a nature different
in kind and degree from that suffered by the general pub-
lic in the exercise of a public right.

III. The Third Circuit Erred In Holding That Petitioner
PECO Is Not Entitled To Indemnification From
Hercules

The Third Circuit has also held that PECO is not
entitled to indemnification from Hercules because
PECO could not have been compelled through legal ac-
tion taken by DER pursuant to the Clean Streams Law
to incur the abatement expenses for the nuisance cre-
ated by Hercules. :

However, §691.316 of the Clean Streams Law spe-
cifically provides in pertinent part:

[w]henever the department finds that pollution
or a danger of pollution is resulting from a con-
dition which exists on land in the Common-
wealth the department may order the landowner
or occupier to correct the condition in a manner
satisfactory to the department or it may order
such owner or occupier to allow a mine operator
or other person or agency of the Commonwealth
access to the land to take such action. For the
purpose of this section, “landowner” includes
any person holding title to or having a propri-
etary interest in either surface or subsurface
rights.

23

Under the Pennsylvania Clean Streams Law, “pollution”
is defined as “contamination of any waters of the Com-
monwealth such as will create or is likely to create a
nuisance.” 35 Pa. C.S.A. §691.1 (Purdon 1977). The jury
specifically found that Hercules had created a nuisance
which was polluting or contaminating the Delaware
River and the groundwater beneath the Chester site.
PECO removed the contamination left by PICCO and
then sued Hercules to recover the costs of the cleanup,
as it is entitled to under principles of indemnification. As
articulated by the Court in Builders Supply Co. v. Mc-
Crhe, 366 Pa. 322, 325, 77 A.2d 368, 370 (1951):

[t]he right of indemnity rests upon a difference
between the primary and the secondary liability
.... tis a right which enures to a person who,
without active fault on his own part, has been
compelled, by reason of some legal obligation, to
pay damages occasioned by the initial negli-
gence of another, and for which he himself is
only secondarily liable.

The Court continued:

secondary as distinguished from primary liabil-
ity rests upon a fault that is imputed or construc-
tive only, being based on some legal relation
between the parties, or arising from some posi-
tive rule of common or statutory law or because
of a failure to discover or correct a defect or rem-
edy a dangerous condition caused by the act of
the one primarily responsible.

366 Pa. at 328, 77 A.2d at 371.
See also, Mixter v. Mack Trucks, Inc., 224 Pa. Super.
313, 308 A.2d 139 (1973); Restatement of Restitution,
§§95, 96 (1937).

The instant case falls squarely within the protection
afforded by the law of indemnification. PECO was re-
quired by Pennsylvania law to abate the nuisance only

24

because of PECO’s status as landowner. See Clean
Streams Law, 35 Pa.C.S.A. §691.316 (Purdon 1977);
National Wood Preservers, Inc. v. Commonwealth De-
partment of Environmental Resources, 489 Pa. 221, 414
A.2d 37 (1980). PECO’s liability was imputed, construc-
tive and statutory, i.e. secondary. Under the law of nui-
sance, PECO is entitled to recover from the party which
is primarily liable for creating the nuisance, PICCO/
Hercules. That is what the jury found and the District
Court affirmed.

The Third Circuit attempts to justify not shifting the
responsibility to Hercules where it properly lies on the
basis that Hercules was not the culprit, rather it was
PICCO. But such an “equitable” analysis contradicts the
Third Circuit’s holding that Hercules is PICCO by virtue
of the de facto merger doctrine and the Panel’s holding
that: “Hercules has [expressly] assumed any liability
PICCO may have had due to the pollution of the Chester
site.” (Appendix, at 11). Surely PICCO (ergo Hercules)
“was best suited to prevent the pollution.” There can be
no question but that PICCO, if it had not been merged
into Hercules, would have had to answer to PECO for
indemnification. Nev ertheless, the Third Circuit seemed
to be swayed by the “fairness” of making PECO bear the
responsibility because ‘PECO had an opportunity to pro-
tect itself through inspection and negotiation . . .” (Ap-
pendix, at 30). But even if that consideration had any
bearing on the issues, it ignores the reality of the case
and the evidence. PECO asserted, and evidence so es-
tablished, that the buried contaminants were a latent
condition undiscovered until years later. Indeed,
Hercules’ defense proffered through former PICCO em-
ployees was that PICCO had not deposited the pollutants
of which PECO and DER complained.

It is difficult to understand why the Third Circuit
believed it is fairer to shift the burden for this nuisance
to PECO, who certainly had nothing to do with its cre-
ation, rather than to the party who created it. Once the

25

Third Circuit determined that Hercules assumed the li-
ability for the Chester site, it acknowledged that
Hercules is primarily liable and it, not PECO, should
bear the burden of abatement.

26

CONCLUSION

The decision of the Third Circuit Court of Appeals in
this case presents a grave disruption of the well-
established principles of standing as defined by the prior
decisions of this Court. This unprecedented ruling by the
Third Circuit seriously muddles the federal constitu-
tional issue of standing with an analysis of whether Pe-
titioner failed to state a claim upon which relief could be
granted. Regardless of the intention of the Third Circuit,
its decision violates Petitioner’s federal constitutionally
protected right in specifically holding that Petitioner had
no standing to sue for public nuisance. Moreover, the
decision of the Third Circuit wreaks havoc on the federal
court system by destroying the finality of the case and
reopens the case for further litigation, since a denial of
relief on the ground of standing does not reach the merits
of the case. Nor was the fundamental error committed by
the Third Circuit harmless as to Petitioner. ‘A proper
analysis of Petitioner’s public nuisance claims would
have resulted in the inexorable conclusion that Peti-
tioner was entitled to its judgment against Respondent
for monetary and injunctive relief for the pollution of its
property.

Accordingly, Petitioner respectfully submits that this
Court should grant a writ of certiorari to review the de-
cision and judgment of the United States Court of Ap-
peals for the Third Circuit.

Respectfully submitted,

d=

Patrick W. Kittredge, Esquire
Joseph M. Donley, Esquire
KITTREDGE, KAUFMAN & DONLEY
800 North American Building
121 South Broad Street
Philadelphia, PA 19107
(215) 732-2700

Counsel of Record for Petitioner

27

CERTIFICATE OF SERVICE

I certify that three copies of this Petition for Writ of
Certiorari were mailed pursuant to Supreme Court Rule
28.3 by United States mail, first class postage, prepaid
this day of September, 1985, to:

John C. Sullivan, Esquire
1818 Three Penn Center Plaza
Philadelphia, PA 19102

John G. Gleeson, Esquire
Hercules Plaza
Wilmington, DE 19899

Kean K. McDonald, Esquire
700 I.V.B. Building

1700 Market Street
Philadelphia, PA 19103

ent OT

OSEPH M. DONLEY, ESQUIRE
Counsel of Record for Petitioner

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385018_0767%3A1. Public record. Not legal advice.