Petition for Writ of Certiorari — General Electric Co. v. Jackson

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IN THE

Supreme Court of the United, Mtatess ys

FILED

GENERAL ELECTRIC COQ - 8 { |

Petitioner,

ve OFFICE OF THE CLERK

LISA PEREZ JACKSON, ADMINISTRATOR,

UNITED STATES ENVIRONMENTAL

PROTECTION AGENCY, et al.,

Respondents

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the District of Columbia Circuit

PETITION FOR A WRIT OF CERTIORARI

THOMAS H. HILL KATHLEEN M. SULLIVAN

GENERAL ELECTRIC CoO Counsel of Record

3135 Easton Turnpike QUINN EMANUEL URQUHART

airfield, CT 06431 & SULLIVAN, LLP

(203) 373-2492 51 Madison Avenue

New York, NY 10010

(212) 849-7000

kathleensullivan@

quinnemanuel.com

CARTER G. PHILLIPS

SIDLEY AUSTIN LLP

1501 K Street, NW

Washington DC 20005

(202) 736-8000 DONALD W. FOWLER

ERIC G. LASKER

HOLLINGSWORTH LLP

1250 I Street, NW

Washington, DC 20005

(202) 898-5800

JONATHAN MASSEY

MASSEY & GAIL LLP

1325 G St. NW

Suite 500

Washington, DC 20005

(202) 652-4511

Counsel for Petitioner

December 29, 2010

WiLSON-EPES PRINTING Co., INC. — (202) 789-0096 — WASHINGTON, D.C. 20002

QUESTIONS PRESENTED

Under Section 106(a) of the Comprehensive Envi

ronmental Response, Compensation, and Liability Act

(“CERCLA”), 42 U.S.C. § 9606(a), the United States

Kknvironmental Protection Agency (“EPA”) has issued

over 1,700 untlateral administrative orders (“*“WAQs”)

during the last three decades to over 5,400 companies

it adjudges potentially responsible parties (“PRPs”),

compelling response actions costing an agyrepate

$5 billion, all in concededly non-emergency situations

and without any pre-issuance notice or hearing. UAQOs

impose significant response costs on PRPs that comply.

A PRP that seeks to challenge the UAO rather than

comply faces the threat of treble damages and daily

fines of $37,500 that accumulate pending judicial

review that can be triggered only at EPA’s sole

discretion. As a result, any non-complying PRP is

subject to significant decreases in market value and

Increases in financing costs. The court of appeals

held that a UAO’s imposition of such financial

harms does not deprive PRPs of property under the

Due Process Clause of the Fifth Amendment. The

questions presented are:

lL. Does a UAO’s tmposition of either significant

response costs or significant decreases in a PRP’s

stock price and credit rating constitute a deprivation

of property under the Due Process Clause?

2. Does CERCLA’s UAO scheme impermissibly

coerce compliance in violation of the Due Process

Clause by conditioning any judicial review of a UAO

upon the threat of treble damages and fines that

accumulate at EPA’s sole discretion?

PARTIES AND RULE 29.6 STATEMENT

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nhespondent: defendar

ickson, Admunistrator, Unites

t.| LI nited states her)

1 State Kenvironment

Protection Agency. !

ronmental Protection Apgvens Thi Petitionel

KMlectric Company, a pul

General blicly held COMpa

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Petitioner ha parent mpai

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NTED

QUESTIONS PRESEN

PARTIES AND RULE 29.6 STATEMENT

PETITION FOR A WRIT OF CERTIORAI

OPINIONS BELOW

JURISDICTION

CONSTITUTIONAL PRO

INVOLVED

STATUTORY PROVISIO

TATEMENT

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obatutory back

REASONS FOR GRANTING THE WRI

THE D.C. CIRCUITS DECISION CON

FLICTS WITH THIS COURT'S

DECISION IN DOEFHR AND THI

DECISIONS OF OTHER CIRCUITS

AND STATE COURTS

THE D.C CIRCUITS OPINION

CONFLICTS WITH THIS COURT

DECISION IN EX PARTE YOUNG

CIRCUITS DECISION RATS

THE D.C

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nent. taken on June 26. 2007

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Supreme Court of the GAnited States

PEREZ JACKSON, ADMINISTR

NITED STATES K,NVIRONMEN'

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Petition for a Writ of Certiorari to |

United States Court of Appeals

for the District of Columbia Circu

PETITION FOR A WRIT OF CERTIORAI

Petitioner, General Klectri : ‘

;

petitions for a writ of certiorari to review the

ment of the United States Court of Appeals 1

District of Columbia Circuit in this «

OPINIONS BELOW

ine opinion oj the Court of Appeal e |

Circuit (Pet. App. 1-33a) is reported at 610 F.3d LIL

‘he relevant opinions of the district court

reported at 362 F. Supp. 2d 327 (Pet. A

nd 595 F. Supp. 2d 8 (Pet

sy t}

Piulal

ties of $37,500 per day, 42 U.S.C. §§ 9606(b)(1

9607(c\(3); 40 C.F.R. § 19.4, which accumulate unt

KPA, at its sole discretion, brings an action to enforce:

its order. 42 U.S.C. 88 9606(b)(1), 9607(c)(3), 9613(h

Since EPA has up to six years to bring suit, see 4

U.S.C. § 9613(¢)(2), such fines could total over $8

million per violation, plus tr

i ¢

many millions of dollars

| }

‘ble damages totalil

a disabling sum for

’ eo . ¢ > T f ¥ . ‘es

Recognizing that a UAO is eff

mectively unrevy

ible. EPA has abandoned

use of judicial abateme

ictions under CERCLA in favor of issuing UAQOs

ill PRPs that decline to enter into consent decre

Pet. App. 80a; see also EPA, OSWER Directive N

9833.0 Guidance on CERCLA Sectir

(Inilateral Admunistrative Orders for

Designs and Remedial Actions (“EPA

} (Mar. 7, 1990), available at http://www.epa.gov

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lance/resources/policies/cleant I

up/supertun¢

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Agency typically will

private-party response through unilatera

which

niorcem

rdering private reci]

illion for response cost

tatutory language rest he issuance

o situations posing “an imminent and

ndangerment to the public health or welfare

nvironment,” it 1s undisputed that EPA does

e UAQOs in cases of

stead ‘onduc

environmental e

up operations

ne }

“from bdDelng u

does not violate Ex parte Young because CERCLA

contains a “good faith” defense and only a judge may

impose any ultimate penalties, Pet. App. 122a. While

rejecting GE’s facial challenge, the district court al-

lowed discovery to proceed on GE’s claim that EPA’s

pattern and practice in issuing UAQOs unconstitution

ally deprives PRPs of due process mghts. Pet. App

126a.

Over the ensuing four years, the parties engaged

substantial discovery: “The parties produced tens of

thousands of documents, conducted numerous fact

and expert depositions, and exchanged reports and

rebuttal reports for six experts.” Pet. App. 43a. In

e words of the district court, “[t]he factual record

is now, to put it bluntly,

Based on this record, tne district court issued

second opinion containing a series of factual finding:

supporting its conclusion that UAOs impose imme

diate and substantial costs on recipients. The district

court found that, if a recipient complies with a UAO

it must perform the response actions set forth in the

order and incur costs that average $4 million. Pet

App. 77a. If a recipient elects to challenge a UAO

rather than comply, however, it faces contingent

liability for treble damages and noncompliance penal

ties that accumulate at the rate of $37,500 per day

causing it immediate and significant harm in the

form of reduced market value and increased costs of

financing. Pet. App. 70-71la. In so finding, the district

court relied on an expert econometric analysis that

calculated that noncompliance with a UAO would

cause a recipient, on average, an immediate $76.4

million decrease in market value and a significant

762 Bye

increase in financing costs. Pet. App. 64a

DA . enport ‘ no ty

tr Las Wil TAPS LL Uidi Lit iis

recipient’s failure to comply with a UAO would

17 + } . |

LIL ( ( PEC |

use a significant decrease 1n stocK pri

crease 1n 1ts cost of hnancing [

Pet. App. 66

Based on these findings, the district

luded that UAOs impose significant pre-heari

‘privation:s recipients tnat trigger ]

‘x | maTran ‘ x

ys { rArx\ > < VULCTILIALLY

large—on average $4 million for complying PRI

nd some substantial, unidentified amount {

:oncomplying PRPs—that they may have coll

eral effects. UAOs could put some PRPs out

husiness For other PRPs, UAOs may affe

perations, like whether to bid for new proj

} }

hire addition employ

4 @ fia empna 1dde

, ‘

urts opinion in Connecticut Doehr, 501 |

} }

991), the distmct court held that these n

IDP D

iences to a PRP’s stock price and cost of financi!

. . ss te bes ‘ ]

t. App. 70-71la, are “suffici )

tection,” Pet. Ap}

urning to whetner the | vided to FI

constitutionally sufficient, the court applied th

alancing test from Mathews v. Eldridge, 424 U

government’s interest and risk of error

appealed both decisions.

C. The D.C. Circuit Decision

On appeal, the Court of Appeals for the D.C.

Circuit did not dispute the district court’s finding

that UAOs result in immediate, adverse market

impacts that “are irreparable and cannot be remedied

through a later, delayed challenge to [a] UAO.” Pet.

App. 13a. The court of appeals held, however, that

such injuries are irrelevant because it first had

to answer “an antecedent question: does the Due

Process Clause protect PRPs’ interest in the market’s

assessment of their stock, brand, and credit wor-

thiness?” Pet. App. 13a.

The court of appeals answered that question in the

negative, reasoning that there was “no independent

source such as state law” for a PRP’s interests in its

market value and creditworthiness, Pet. App. 14a

(quotation mark omitted), and that a PRP’s “claimed

injuries” are merely “consequential” because they

result “from independent market reactions to the

issuance of a UAO,” Pet. App. 14a. The court of

appeals interpreted Doehr as speaking only to the

“significance of the private interests at stake” under

the first Mathews factor—not to whether a govern-

ment action triggers due process protection in the

first place. Pet. App. 15a. In the court of appeals’

view, “although Doehr does hold that direct, partial

impairments of property rights may well warrant due

process safeguards, nothing in the opinion implies

that consequential injuries, standing alone, merit due

process protection.” Pet. App. 16a. For the same

Because the D.C. Circuit did not reach this

loes not raise it for review before this Court

reasons, the court of appeals rejected GE’s patt

and practice challenge to EPA’s use of UAO Pe

App. 30-32a.*

The court of appeals also rejected GE’s Eo parte

Young challenge. The court recognized that a PRP

has a protected property interest in the costs that if

incurs to comply with a UAO, Pet. App. 10a, but, like

the district court, found due process in the event ot

noncompliance satisfied by CERCLA’s provision of

“good faith” defense and the fact that any noncor

pliance penalties are imposed by a court, not

administrative agency. Pet. App. 11-]

REASONS FOR GRANTING THE WRI

l THE D.C. CIRCUIT’S DECISION CON

FLICTS WITH THIS COURT’S DECISION

IN DOEHR AND THE DECISIONS OF

OTHER CIRCUITS AND STATE COURTS

In Connecticut v. Doehr, 501 U.S. 1, 11-12 (1991

this Court held that consequential impacts from

government adjudicatory action can be “significant

enough “to merit due process protection.” Thi

decision below departs from Doehr, holding that the

indisputably significant consequential impacts

business suffers from a UAO do not trigger due pri

cess protection. Pet. App. 15-16a. The D.C. Circuit

sought to justify this departure by reinterpretin;

Doehr, opining that this Court did not categorize

consequential injuries as property interests but

rather treated them mere ly } consider wmI0ONn

‘ Like the district court, the c ippeals he +}

pattern and practice challenge was not barred at the thresh

by CERCLA’s jur) diction tripi

9- 90e

40-Z20a

App

ied

to the weight of the interest under the first factor in

the Mathews balancing test. Pet. App. 15a. This new

view of Doehr stretches beyond the CERCLA context:

under the D.C. Circuit’s narrow definition of “prop

erty,” owners have no entitlement to due process

before government adjudicatory action in any regula

tory setting deprives them of market equity or the

ability to secure financing necessary for its produ

tive use.”

The court of appeals decision thus conflicts with

Doehr, which held that a state statute that autho

rized a non-possessory -pre-judgment attachment of

real estate affected “significant” property interest:

and triggered due process protection, because such an

attachment “clouds title; impairs the ability to sell or

otherwise alienate the property; taints any credit

rating; reduces the chance of obtaining a home equity}

loan or additional mortgage.” 501 U.S. at 11. This

case involves just the same sorts of consequential

encumbrances to property rights; UAOs impair the

recipients’ ability to alienate property and to secure

financing 1n a manner analogous to government

imposition of a lie r attachment Contrarv to the

The court of appeals also held that, “although a UAO m

well damage the PRP’s reputation,” GE had not alleged

424 U.S. 693 (1976

Pet. App. 16-17a. But Paul is inapposite, as the due proce

“stigma-plus” as required by Paul v. Davis,

interest at stake here, as in Doehr, is not merely injury to

business’s reputation but significant market impacts to its stock

value and credit rating. That such property interests ar

“intangible” in no way deprives them of due process protection

See, e.g., Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll

Sav. Bank, 527 U.S. 627, 642 (1999) (patents); Ruckelshaus ¢

Monsanto Co., 467 U.S. 986, 1003-04 & n9 (1984) (trad

secrets): Del., Lackawanna & W. R.R. Co. v. Pennsylvania, 19

U.S. 341, 359 (1905) (corporate franchiss

, “2

D.C. Circuit’s interpretation, Pet. App. 15a, Doehr

found such harms to property interests “sufficient to

merit due process protection” even if imposed by “the

market” in response to the government action. 501]

Us. at 12

That this is the meaning of Doehr is confirmed

by this Court’s express agreement with the Second

Circuit holding under review in that case, Doehr, 501

U.S. at 11, that consequential market impacts arising

from government adjudicatory action trigger due

process protection. See Pinsky v. Duncan, 898 F.2d

852, 854 (2d Cir. 1990), affd sub nom. Connecticut v

Doehr, 501 U.S. 1 (1991). As the Second Circuit

framed the issue: “As a threshold matter, we must

determine whether the ‘seizure’ at issue in this case

a nonpossessory attachment of real estate-——deprive:

the owner of a significan€ property interest within

the meaning of the fourteenth amendment.” /d. And

as in Doehr, the Second Circuit’s conclusion w

unambiguous

[Ajlthough an attachment of real ate does ne

deprive the landowner of the use and possession

of his property, and thus does not amount to

‘seizure” in the literal sense, it nevertheless ha

a significant impact on the owner’s ability to

exercise the full scope of his property rights. An

attachment not only impairs the marketability of

the real estate, but also may harm the owner’

credit rating, and may prevent him from using

the property as collateral for a loan Kven if

short-lived, these effects are certainly worthy

of due process protection. ... Consequently, we

hold that a nonpossessory attachment of rea

tate deprive: the OWne! cyt : constiftutionall

protec ted proj]

amendment

ld. (internal citations omitted) (emphases addet

Contrary to the clear language in Doehr and _ the

underlying Second Circuit decision, the D.C. Circu:

here concluded that “nothing in [Doehr]| implies that

consequential injuries, standing alone, merit dui

process protection.” Pet. App. 16a (citing Doehr, 50

U.S. at 29 (Rehnquist, C.J., concurring in part an

concurring in the judgment)). Such a narrowing of th

scope of constitutionally protected property calls fo

this Court’s review and reaffirmation of the

of Do hy

The D.C. Circuit’s erroneou: interpretation of /

also conflicts with the First Cuircuit’s decision

Reardon v. United States, 947 F.2d 1509 (1st ¢

1991) (en banc) fteardon, the first circuit co

decision to interpret Doehr, confronted an 1

similar to that here: namely, whether CE RCLA’s li

procedure under 42 U.S.C. § 9607(/) (1991) violate

due process because it did not provide for a p

deprivation hearing. Reardon, 947 F.2d at 1517

determining whether there was a “[dJjeprivation

issue so as to trigger due process protection, Reard

turned t this Court’s vuidar Fini hal

a ft

in light of these comment in

lude that the lien on real property created

12 U.S.C. § 9607(/) amounts to deprivation ol

‘significant property interest” within the m¢

ing of the due process clause. The EPA’s lien |

substantially the same effect on the Reardon

the attachment had on the plaintiff tn Do

louding title, limiting alienability fy

nt and

potential mortyvra

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owner's title” since it will be “extremely difficult” for

the owner to sell the property or to use it as equity),

superseded by statute on other grounds as_ stated

in Winkler Constr. Co. v. Jerome, 734 A.2d 212, 248

(Md. 1999).

The D.C. Circuit’s opinion below is thus in conflict

with this Court’s holding in Doehr and the First

Circuit’s decision in Reardon and in tension with the

decisions of other federal circuits and state supreme

courts. This case presents an especially good vehicle

for resolution of the important due process issues at

stake because it involves a fully developed factual

record and detailed findings by the district court on

the nature and extent of the deprivation, Pet. App

45a n.4, 77a. The parties engaged in extensive dis-

covery, Pet. App. 43a, at considerable cost and effort

that is unlikely to be replicated in a future case, see

EPA Answering Br. 13-14, No. 09-5092 (“The effort

consumed over 14,000 hours of personnel time and

over $900,000 in salary costs in the first year alone.”)

There is thus no need to speculate about the harmful

consequences of government action here, in contrast

to many other cases in which due process challenges

have foundered on the sparseness of the underlying

records. See, e.g., Hannah v. Larche, 363 U.S. 420,

443 (1960) (noting that any proposed harms are

“purely conjectural” with “nothing in the record”

indicate that such harms will result)

Wi. THE D.C. CIRCUIT’S OPINION CON.

FLICTS WITH THIS COURT'S DECISION

IN EX PARTE YOUNG

lhe holding of the court of ay

pealS alSoO conti

with this Court’s decision in Ex parte Young, wl

struck down as contrary to due process a statute that

compliance: Dy threatening tho

peg

“

cess nigh

{

-d to challenge a UAO. Pet. App. 202a ‘TA

legislative scheme that denies subjects an oppor

tunity to seek judicial review of administrative order:

xcept by refusing to comply, and so put themselve

In immediate jeopardy of possible penalties ‘so heaw

as to prohibit resort to that remedy’ runs afoul of the

jue process requirements of the Fifth and Fourteent!

Amendments.” Schultz v. Internal Revenue Ser

113 F.3d 297, 303 (2d Cir. 2005) (citation omitted

The fully developed factual record in this case thi

a violation of Ex parte y

emonstrates a clear \

lf anything, the offense to due process is great

here than in Young because CERCLA forces a UA

recipient to wait for the government to “take its ow

sweet time before suing.” Reardon, 947 F.2d at 151

Because a PRP cannot bring suit to challenge a UA

ut rather must wait until EPA brings suit, si

S.C. $§& 9606(b)(1); 9607(c)(3); 9613(h), a PRP ma

eceive a neutral decision-maker’s review of millior

f dollars of contingent hability, as EPA itself h

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ited, onl and whe n the EPA seeks to enf

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different. Rather than allow a PRP to obtain imm«:

uct t

diate judicial relief by challenging the validity of

UAO, CERCLA leaves the timing of judicial review

entirely in EPA’s hands. See 42 U.S.C. § 9606(b)(1

Thus, in direct contrast to the mine operators 11

Thunder Basin, a PRP gets its day in court only

and when EPA, in its sole discretion, brings a

enforcement action—a step that can take up to fiv

years, 28 U.S.C. § 2462, and in some cases six, see 4

U.S.C. § 9613(g)(2). In the interim. each day that

passes gives rise to a new fine of $37,500, see 42

U.S.C. § 9606(b)(1); 40 C.F.R. § 19.4, with the chanc

of treble damages, 42 U.S.C. §$ 9607(c)(3).' Thus

should EPA decide to wait the full six year

before bringing an enforcement action, a PRP woul

be liable for over $82 million per violation, |

§ 9606(b)(1), with the potential for treble damag

$ 9607(c)(3)

1 “bet the company scenario e'

ee caer a 7 ore } i — eee) eg: ee Rime

Or mMmanv tarve lkeSS( la de 1 Knetl I

| .

smaii ones

No otner statute WhnICN Ut i\ f

overnment such 1 moadaern-aay Sword ol Damoc (

To the contrary, every other comparable schen

Fivy

iffords recipients of adjudicatory administrative orde!

ither a prior hearing or a prompt opportunity f

: 3

cAit

5 l al

Ape cy chi 5 t Ke up hnpillal

ler, PRPs rema

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UAO scheme’s abrogation of protections regularly

afforded by other regulatory statutes “raises a

presumption that its procedures violate the Due

Process Clause.” Honda Motor Co. v. Oberg, 512 U.S.

415, 430 (1994): see also id. (“As this Court has stated

from its first due process cases, traditional practice

provides a touchstone for constitutional analysis.”).

As the district court found below, the threat of

“betting the farm” is more than illusory here: the

deprivations imposed by a UAO are so large that they

“could put some PRPs out of business.” Pet. App.

77a. Notwithstanding this finding, the court of

appeals held the imposition of treble penalties and

enormous daily fines as the price of challenging a

UAO unproblematic for due process purposes because

any such challenge would ultimately be subject to a

“sufficient cause” defense and a district court’s discre-

tion. Pet. App. 12a. The constitutional touchstone

under Ex parte Young, however, is not the theoretical

availability of some future relief from onerous penal-

ties but the real-world, practical effect of the statu

court to seek extension of emergency orders beyond 60 days

Commodity Futures Trading Commission Act, 7 U.S.C. § 12a(9

affording immediate judicial review of emergency orders relat

ing to trading margins); Federal Aviation Act, 49 U.S.C. § 44709

providing that orders revoking operating licenses are imme

diately appealable to the National Transportation Safety Board,

which must dispose of any appeal within 60 days); Federal

Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136d(c)(1),

(3) & (4) (allowing parties subject to suspension orders ti

seek an immediate administrative hearing and judicial review

even in cases of “imminent hazard”). Other regulatory safety

schemes require government agencies to go to the courts in the

first instance. See, e.g., Consumer Product Safety Act, 15 U.S.C

S 2616(a); Occupational Safety and Health Act, 29 U.S.C. § 662

[oxic Substances Control Act, 15 U.S.C. § 2606

tory penalty scheme. Here that practical effect is

that challenges to government action are effectively

precluded, as EPA controls a PRP’s access to court.

See Thunder Basin, 510 U.S. at 218 (holding that Ex

parte Young bars statutory schemes “in which the

practical effect of coercive penalties for noncom-

pliance [is] to foreclose all access to the courts”

(emphasis added)).

Based on the undisputed factual record here, there

can be no doubt that the CERCLA UAO scheme has

a coercive “practical effect.” Over the last 30 years,

despite often heated disputes surrounding CERCLA

liability, see, e.g., Stephen Breyer, BREAKING THE

VICIOUS CYCLE: TOWARD EFFECTIVE RISK REGULA-

TION 18-19, 39-41 (1993), and the substantial costs

imposed by UAQOs, very few PRPs have ever dared

defy a UAO in order to challenge its validity through

independent judicial review. Pet. App. 202a. The

facts developed in this case thus prove the adage that

judicial review is “merely nominal and _ illusory”

where it can be obtained “only at the risk of having to

pay penalties so great that it is better to yield to

orders of uncertain legality rather than to ask for the

protection of the law.” Wadley S. Ry. Co. v. Georgia,

235 U.S. 651, 661 (1915).

This Court thus should grant review to determin:

whether CERCLA violates the fundamental com-

mand that “the right to a judicial review must

be substantial, adequate, and safely available.” Jd.

Rather than being “safely available,” judicial review

of a UAO can be obtained only after an unknowable

period of uncertainty during which a PRP is power-

less to prevent the amassing of enormous liability

while EPA “take[s] its own sweet time before suing.”

Thus, unlike the mining statute in Thunder Basin

CERCLA violat

tion of enormou:

iudicial review

this Court’s review

(il. THE D.C. CIRCUIT’S DECISION RAISE

ISSUES OF NATIONAL IMPORTANCE

The decision below has grave importance for

wide variety of business subject to CERCLA UAO

As of 2009, EPA had nearly 4,000 sites under reviev

for potential CERCLA action, each of which could

involve multiple PRPs and UAOs. See EPA, Supe

fund National Accomplishments Summary Fisca

Year 2009, http://www.epa.gov/superfund/accomp/nun

bersO9. html. Those sites are distinct from thi

approximately 500 sites that are officially designated

as Superfund sites, i.e., listed on the Nationa

Priorities List, which currently have constructio1

ongoing. See id As the district court observed, «

average EPA issues “approximately six UAO

nineteen PRPs every month,” Pet App oZ2a,. meanin

that the EPA has and will continue to generat

thousands of UAQOs, affecting any PRP that fal

under CERCLA’s “four broad classes of PRPs,” B

lington N. & Sante Fe Ry., 129 S. Ct. at 1878 (noti

that “[o]lnce an entity is identified 1 PRP

mpelled to clean 1 pa con

Moreover, while | lin tne HR!

lecision below also has serious implic:

regulatory context Under the court of appeal

view of Doehr, thers no longer any aue proce

limit to the government’ ibility ienificant

1ecrease i DusInes: toc}

through unreviewed

Ba:

rovernment power raises

to the business community

Recent economic experience starkly illustrates th

error in the reasoning that market impacts resulting

from adjudicative orders do not constitute depriva

tions of property triggering due process. After the

financial shocks of late 2008, the availability of credit

dropped sharply as banks tightened their lending

requirements and the costs of financing increased

across large sectors of the economy. As explained i1

1 recent Congressional Oversight Panel Report:

The credit crunch was accompanied by severe d:

clines in numerous economic markers and wide

spread anxiety and uncertainty. The value of

the stock market plunged 24 percent in the fall

of 2008 and another 15 percent by the end of

January 2009. Real GDP declined at an annual

rate of 2.7 percent in the third quarter of 2008

5.4 percent in the fourth quarter of 2008, and 6.4

percent of the first quarter of 2009.

Congressional Oversight Panel, The Smal! Busine

Credit Crunch and the Impact of the TARP (May

2010) at 16, available at http://cop.senate.gov/report:

library/report-051310-cop.cfm. These economy-wids

figures reflect thousands of individual business fail

ures, huge drawdowns on individual company’s finan

cial reserves, and dramatic declines in_ busine:

investments and planned upgrades and moderniz

L1IonsS

As a recent analysis found, | firms tl

nancial constraints during » credit crunch

perienced sharp declines in all areas of th

business, with plans to reduce employment (by 11'

R&D spending (by 22%), capital investm«

larKet expenditure \

14%) in 2009. See Murillo Campello, et al., Th

ffects of financial constraints Evidence from

financial crisis, 97 J. OF FIN. ECON. 470, 471 (201(

Other studies have likewise found that constraints o1

1 company’s ability to obtain financing significantl

increase the probability of the company exiting the

market,'“ decrease a company’s investments,’ an

reduce the likelihood that a company will undertak:

innovative projects“ and hire new employees.'” Sim

larly, decreases in the value of a company’s equity

in addition to being a direct measure of a lo:

property value—also have a significant

impact on a company’s growth because of the con

juent increases 1n the company’s costs of financing

The D.C. Circuit decision artificially distinguish

between the physical attributes of property and sur

ther important attributes of property necessary {

ts use and enjoyment, despite the longstanding ru

t “lainy significant taking of property | a

5 (2008

Alessandro Gu irifyit

financial COMSLrTaLnts

nel of UK firms, 32(9).

rréederique Savipgnai

wation: evidence from Fre)

la Maison des Science

inthéon-Sorbonne (2006

Stephen Nickell] az Daphni

ure Affect Firn ASE [:

See Charles T. C

ral

Examination o

within f VUTVIC\ re) tne rT

Fuentes v. Shevin, 407 U.S. 67, 86 (1972):

Buchanan v. Warley, 245 U.S. 60, 74 (1917) (“Propert

Is more than the mere thing which a person owns

is elementary that it includes the right to acquire

use, and dispose of it The Constitution protect

these essential attributes of property.” (citing //olde)

v. Hardy, 169 U.S. 366, 391 (1898))). The decisior

below thus leaves companies that are subject

UAOs with no meaningful mght of review

government adjudicatory actions that, as the distri

court found in this case, “could put some PRPs out

business.” Pet. App. 77a

seyond the UAO context, failure to consider the

economic realities substantially diminishes the prop

erty rights of businesses faced with unilateral agenc:

adjudications in the modern regulatory state. Unlik

other agency actions that contain due process prote

tions, see, e.g., 5 U.S.C. §§ 553-54 (listing various dus

process requirements for certain agency actions sucl

as notice and comment rulemaking or a moderate!

neutral decisionmaker), unilateral administratiy

orders invite inaccurate agency decisionmaking witl

out any demonstrated need for foregoing due proc

n order to protect the public against exigent harm

ee 42 U.S.C. § 9606(a) (allowing KPA to “issuls

such orders as may be necessary to protect public

health and welfare and the environment” withou

due process). ‘The importance of this issue acro

wide range of regulatory context underscore

ed for th ( bead! revi cyt Ti { } ; }

because it has repeatedly received UAQOs and is likely

to receive them in the future. Jd. 7 7; see also id

{91 31-47. GE sought “[a] declaratory judgment that

the provisions of CERCLA relating to unilatera

administrative orders are unconstitutional.” Jd

Prayer for Relief J

The district court dismissed GE’s amended com

plaint for lack of jurisdiction. According to the district

court, section 113(h) prohibits “broad, pre-enforcement

due process challenge[s] to the statute... until EPA

seeks enforcement or remediation is complete” on a

particular UAO. GE I, 257 F. Supp. 2d at 31. We

reversed, ruling that section 113(h) presented no bar

to GE’s lawsuit because the company “does not

challenge any particular action or order by EPA.”

IT, 360 F.3d at 191

On remand, the district court issued two decisions

that GE now appeals. In the first, issued in 2005, the

district court granted EPA’s motion for summary

judgment on GE’s facial due process challenge. Ger.

Elec. Co. v. Johnson (GE III), 362 F. Supp. 2d

(D.D.C. 2005). The district court held that the statute

provides constitutionally sufficient process because

by refusing to comply with a UAO, a PRP can force

EPA to bring a court action in which the PRP can

challenge the order. The court also rejected GE’s

claim that CERCLA’s fines and treble damages are so

severe that, as a practical matter, they foreclose

judicial review. In the alternative, the district court

applied the “Salerno doctrine,” which prohibits facial

invalidation of a statute unless the statute “is

inconstitutional in every application.” Jd. at 343;

}

Jnited States v. Salerno, 481 U.S. 739, 745 (1987)

According to the court, even if CERCLA’s fines and

damages make pre-compliance review unavailable

nome

pre-depnrivation Vie

constitutionality. Appellant’s Br. 24 (quoting Prope

District of Columbia, 948 F.2d 1327, 1332

ir. 1991)) Gnternal quotation marks omitted)

GE’s argument hinges on the Supreme Ci

decision in Ex Parte Young, 209 U.S. 123 (1908), a1

its progeny. Under those cases, a statutory schem

violates due process if “the penalties for disobedience

are by fines so enormous .. . as to intimidate the

laffected party] from resorting to the courts to te:

the validity of the legislation [because] the result i

the same as if the law in terms prohibited the [party]

from seeking judicial [review]” at all. Jd. at 147.

Supreme Court has made clear, however, that statute

imposing fines—even “enormous” fines—on non

complying parties may satisfy due process if sucl

fines are subject to a “good faith” or “reasonable

ground|[s]” defense. See Reisman v. Caplin, 375 U.s

440, 446-50 (1964); Okla. Operating Co. v. Love, 25%

U.S. 331, 338 (1920). Courts have also held that

“there is no constitutional violation if the impositio1

of penalties is subject to judicial discretion.” Wagnez

Seed Co. v. Daggett, 800 F.2d 310, 316 (2d Cir. 1986

cf. Brown & Williamson Tobacco Corp. v. Engma

527 F.2d 1115, 1121 & n.8 (2d Cir. 1975)

CERCLA guarantees these safeguards. Indeed

statute offers noncomplying PRPs several levels

protection: a PRP faces daily fines and_ trebl

damages only if a federal court finds (1) that th

UAO was proper; (2) that the PRP “willfully” failed 1

comply “without sufficient cause”; and (3) that, in the

court’s discretion, fines and treble damages ar

appropriate. 42 U.S.C. §§ 9606(b)(1), 9607(c)(3). As t

the first of these findings-~-the propriety of tl

UAO—the district court reviews EPA’s deter

wor

vTONn

Le)

) it ] iS GE poln

we relied on McNary ( Haitian Refugee Cente

Inc., 498 U.S. 479 (1991), in which the Supreme Cour

allowed a pattern and practice due process challen;

to the way in which the Immigration and Naturaliza

ion Service was enforcing the immigration laws. Bu

ve cited McNary only to Support our narrow readil

tf section 113(h)’s text 1.e., that the provision

presents no bar to a facial challenge. See GE II, 36

I’. 3d at 192-93; see also City of Rialto, 581 F.3d at 8

characterizing GE I// as holding

hallenge was not barred”

Although we thus read GE I : \OLdIN

the district court had jurisdiction over GE’s fac

challenge, we nonetheless agree with GE that tl

district court had jurisdiction to entertain its patte:

ind practice claim as well. Section 113(h) is quit

it only prohibits district courts from reviewin

before enforcement or reimbursement pro

ceedings have been initiated. Nothing in the provisio

bars a pattern and practice challenge that seeks n

relief with respect to any particular UAO. To be surs

is EPA emphasizes, the district court did calculate

UAO error rate. But significantly for the sectio1

113(h) issue before us, GE sought no relief

, *

re spect

rant

his case is therefore controlled by McNary. Th

he Supreme Court concluded that the plain languag:

f the immigration statute—which barred revie

f a determination respecting an application” fo

pecial agricultural worker (SAW) status, 8 |

1160(e)(1)—referred only to judicial re

practice

Aeys.

Thus, although the statute prohibited courts from

reviewing denials of individual applications for SAW

status, district courts could nonetheless consider

“seneral collateral challenges to unconstitutional

practices and _ policies used by the agency in

processing applications.” Jd. The same_ principle

applies to CERCLA section 118(h)

EPA argues that McNary’s outcome was dictated

by a consideration not present here. In McNary, the

Supreme Court pointed out that because the statute

provided for review of SAW determinations only in

deportation proceedings and only on a limited record,

barring pattern and practice challenges would result

in “a total denial of judicial review of [plaintiffs’]

constitutional and statutory claims.” 498 U.S. at 49%

According to EPA, McNary therefore requires that

plaintiffs like GE who seek to bring pattern and pra¢

tice challenges first show that the statute provides ne

meaningful judicial review for their claims. Becaus:

GE could pursue its due process claims in an

enforcement or reimbursement proceeding, EPA

argues, the district court lacked jurisdiction over the

company's pattern and practice challenge

Properly read, however, McNary’s conclusion that

the immigration statute's jurisdiction-stripping provi

sion presented no bar to a pattern and practice suit

did not depend on the unavailability of alternative

means of judicial review. Instead, it rested entirely

on the Court’s analysis of the jurisdictional provision’s

text: “Given Congress’ choice of stati lory language,

we conclude that challenges to the procedures used

by INS do not fall within ( scope of [the jurisdic

tional bar]. Rather, we hoid that [that provision]

applies only to review of denials of individual SAW

applications.” Jd. at 494. Not until the next section of

\PPENDIX

ED STATES DISTRIC1

DISTRICT OF COLUMBI

sul

nvironmental program. Plainti

reneral Electric Company (“GE” or “plaintiff’) chal

U.S.

» b

Environmental Protection Agency’

administration

of section 106 of the Compre

~z. 7

Environmental Response

“CERCLA”

Compensatio!

IT c<

§ 9601 et seg. GE contends that EPA’s “pattern a1

practice” of administering section 106, 42 U.S.C

§ 9606, violates the Due Process Clause of the Fifth

Amendment. Am. Compl. at J 1. Before the Court are

the motions for summary judgment of GE and EPA

and its administrator, Lisa Jackson.’ For the reason

that follow, the Court rejects GE’s novel, but

substantial, challenge. On the record presented, the

administrative order regime under section 106 of

CERCLA, as administered by EPA, does not offend

due process

BACKGROlT

I. The CERCLA Framework

CERCLA was enacted to ensure efficient and ex

dient clean-up of hazardous waste sites resultil

from industrial pollution. See Key Tronic Corp

United States, 511 U.S. 809, 814 (1994): see al

United States v. Bestfoods, 524 U.S. 51, 55 (1998

Congress intended the parties responsible for pollut

ing a site to clean it up themselves, or at least 1

pay the costs of clean-up. See Control Da

EPA styled its motion as a motior

pleadings, or alternatively, a motion for summary judgm

The same legal standard applies for each kind of motion. Se

Greenhouse v. Geren, 574 F. Supp. 2d 57, 63-64 (D.D.C. 2008

Because the record in this case contains material from th

parties’ extensive discovery, the Court will treat EPA’s mot

as one for summary judgment

* The Court set forth a more comprehensi

CERCLA framework in its previous opinions in this ca

General Electric Co. Whitman, 257 F. Supp. 2d

(D.D.C. 2003) (General Electric I); General Electric

Johnson, 362 F. Supp. 2d 327, 330-31 (D.D.C. 2005

Electric III); see also General Electric Co. v. EPA, 36

189-90 (D.C. Cir. 2004) (General Elect

38a

S.C.S.C. Corp., 53 F.3d 930, 936 (8th Cir. 1995).

Under CERCLA, once EPA identifies a hazardous

site, it seeks to identify “potentially responsible

parties” (“PRPs”). EPA may then initiate negotiations

with PRPs to clean up a site. See 42 U.S.C. § 9622.

EPA has several options if negotiations fail. One

option is to perform the clean-up itself, paying for it

out of the so-called “Superfund” established by

Congress for this purpose. EPA would then bring an

action in federal district court under section 107 of

CERCLA to recover clean-up costs from responsible

parties. Id. §§ 9607(a)(4)(A), 9611(a). Another option

is to seek an order from a federal district court

compelling a responsible party to clean up a hazard-

ous site. Jd. § 9606(a). EPA’s third option is to issue a

“unilateral administrative order” (“UAO”) under

section 106, ordering PRPs to clean up a site. Jd. EPA

may issue a UAO upon a finding “that there may be

an imminent and substantial endangerment to the

public health or welfare or the environment because

of an actual or threatened release of a hazardous

substance from a facility.” /d. EPA’s practice of

issuing UAQOs under section 106 is at the heart of

GE’s due process challenge in this case

Under CERCLA, a PRP that believes it is not

responsible for the clean-up faces a choice whether o1

not to comply with a UAO. If the PRP complies, it

may seek reimbursement from other PRPs or from

EPA itself upon completion of the clean-up. Zd.

§ 9606(b). If the PRP does not comply, then EPA

must file a civil action in federal district court to

enforce the UAO. Id. § 9606(a). The court reviews

KPA’s remedy selection (i.e., its selection of a UAQO)

under the Administrative Procedure Act’s “arbitrary

and capricious” standard. See id. § 9606(b)(2)(D). The

39a

court reviews EPA’s selection of the responsible party

de novo. See Kelley v. EPA, 15 F.3d 1100, 1108 (D.C.

Cir. 1994).

EPA may seek two kinds of monetary penalties if a

PRP does not comply with a UAO. First, if the

noncomplying PRP lacks “sufficient cause” and

willfully violates the order, then HPA may seek

$32,500 for each day of noncompliance. Jd. § 9606(b).

Second, EPA may seek punitive damages up to three

times “the amount of any costs incurred by the

[Superfund] as a result of such failure to take proper

action.” Id. § 9607(c)(3). But these penalties are not

automatic under CERCLA. If the reviewing court

finds that the PRP had sufficient cause for noncom

pliance, then it cannot impose either form of penalty.

Id. §§ 9606(b), 9607(c)(3). Even absent a finding of

sufficient cause, moreover, the court has complete

discretion as to the imposition and amount of any

penalty. Id. § 9607(c)(3).

II. Procedural History

GE filed its Complaint on November 28, 2000, and

amended it on March 14, 2001. GE challenges

CERCLA in two ways. First, GE alleges that the text

of CERCLA itself facially violates the Due Process

Clause. Am. Compl. at J{] 21-28, 50, 54. Second, GE

alleges that EPA’s “pattern and practice” of adminis

tering the UAO regime under section 106 violates

GE’s due process rights. /d. at 14] 17-20, 51-52, 54.

In March 2001, EPA moved to dismiss GE’s

Amended Complaint on jurisdictional grounds. EPA

argued that this Court lacked subject matter jurisdic

tion because section 113(h) of CERCLA bars judicial

review of a section 106 order until the clean-up is

complete. This Court agreed and granted EPA’s

I 5 x4

40a

motion to dismiss. General Electric 1, 257 F. Supp. 2d

at 12. On appeal, however, the D.C. Circuit reversed

and instructed this Court to consider the merits of

GE’s due process challenge on remand. General Elec

tric IT, 360 F.3d at 194. The court of appeals agreed

that section 113(h) bars review of “as-applied, or

particularized challenges,” but concluded that section

113¢h) does not bar “facial, or ‘systemic” challenges

to CERCLA. Jd. at 192. The court of appeals relied

primarily on two cases to reach its holding: Johnson

v. Robison, 415 U.S. 361, 373-74 (1974), and McNary

v. Haitian Refugee Center, Inc., 498 U.S. 479,

492-94 (1991). Robison was a facial constitutional

challenge to the Veterans’ Readjustment Benefits

Act, 38 U.S.C. § 211(a). Section 211 of that Act barred

review of individual benefit determinations, but the

Supreme Court held that section 211 did not extend

to facial constitutional challenges to the statute.

Robison, 415 U.S. at 367. McNary was a challenge

to the Immigration and Naturalization Service's

“pattern and practice” of administering the Special

Agricultural Workers (SAW) provisions of the Immi

gration Reform Control Act, 8 U.S.C. § 1160. Section

210(e) of that Act barred judicial review “ofa deter

mination respecting an application” for SAW status,

but the Supreme Court held that section 210(e) did

not apply to “general collateral challenges to uncons

titutional practices and policies used by the agency in

processing applications.” McNary, 498 U.S. at 492.

Because Robison and McNary permitted facial and

pattern and practice claims to proceed in the face of

provisions similar to CERCLA’s section 113(h), the

D.C. Circuit instructed this Court to consider GE’s

due process challenges to CERCLA on remand. 360

3d at 194.

tyva

deprivations as evidence that PRPs suffer pre-hearing

deprivations once a UAO is issued, no matter what

they choose to do

The injury inquiry for standing is limited t

whether GE has “set forth” sufficient “specific facts”

to support its claim that EPA deprives GE of liberty

or property without due process by issuing UAOs to

GE. See Lujan, 504 U.S. at 561 (establishing a plain

tiffs burden of establishing standing at the summary

judgment stage).° EPA does not dispute GE’s showing

that EPA has issued 68 UAOs to GE and that GE has

complied with all of them. See EPA Memorandum

in Opposition to GE’s Summary Judgment Motion

(“EPA Opp.”) at 20. And EPA concedes that “GE [can]

establish injury for standing purposes where it does

comply with a UAO and incurs response costs.” EPA

Rep. at 11 (emphasis in original). Therefore, GE has

standing to bring this pattern and practice claim and

may rely on noncompliance-based injuries to the

extent it uses such injuries to establish that PRPs are

deprived of a meaningful choice not to comply with

UAO or that PRPs suffer pre-hearing deprivations

regardless of whether they comply

Ill. Ex Parte Young

GE’s first claim is that EPA’s pattern and practic

of administering section 106 violates procedural due

process under Ex parte Young, 209 U.S. 123 (1908)

Under Ex parte Young and its progeny, a statutory

Courts do not assess the merits of a plaintiffs claim when

considering standing. See Emergency Coalition to Defend Educ

Travel v. Dep't of Treasury, 545 F.3d 4, 10 (D.C. Cir. 2008) (“I

considering standing, we must assume the merits in favor of the

arty invoking our jurisdiction.”). Therefore, at this stage of the

inalysis, the Court presumes that the deprivations GE

1 form the basis for a due process clain

o0a

scheme that imposes penalties on those seeking judi

cial review is unconstitutional if “the penalties for

disobedience are by fines so enormous .. . as to inti-

midate the company and its officers from resorting to

the courts to test the validity of the legislation.” Jd. at

147. Statutes prescribing significant penalties for

violators are not per se unconstitutional, however.

Rather, if a party challenging a penalty or a statute

in “good faith” may not be penalized, then the statute

may be constitutional under Ex parte Young.

See Reisman v. Caplin, 375 U.S. 440, 446-47 (1964).

Here, under section 106(b)(1), a district court must

review any penalty EPA seeks for noncompliance

with a UAO. The court may only impose penalties if a

PRP has failed to comply “without sufficient cause’;

moreover, even if the court finds that the noncom-

plying PRP lacks “sufficient cause,” the court still has

full discretion in deciding whether to impose a civil

penalty, or punitive damages, and if so, in what

amount. See 42 U.S.C. $$ 9601(b)(1), 9607(c)(3).

Courts considering Ex parte Young challenges to

sections 106 and 107 have held that the sufficient

cause defense operates as a good faith safe harbor,

adequately curing any constitutional problems that

steep CERCLA fines and penalties could otherwise

create. See Employers Ins. of Wausau v. Browner, 52

F.3d 656, 664 (7th Cir. 1995); Solid State Circuits,

Inc. v. EPA, 812 F.2d 383, 391 (8th Cir. 1987);

Wagner Seed Co. v. Daggett, 800 F.2d 310, 316 (2d

Cir. 1986); United States v. Capital Tax Corp.,

Civ.A.No. 04-4138, 2007 WL 488084 at *6 (N.D. II.

Feb. 8, 2007). Applying this reasoning in General

Electric III, this Court rejected GE’s facial Ex parte

Young challenge based on the text of CERCLA’s UAO

provisions, although leaving room for GE to further

1 p1 62 |]

GE's pattern and | |

Young fails for the same ri

GE points to four

supposedly intimid:

seeks maximum penalti¢

seeks multiple penaltic

UAO site; EPA rejected Ju

that EPA should impo |

labels noncomplying PRP

matter what EPA ruably

timately decides what, if

' ay courts routinely exe}

determining what kinds of dai

CO lm pose for viol I

United States Capital ‘4

1138, 2007 WL 222590

2007) (awarding $750 d

dam: ives), United Sta i

6395. 1998 WL 962018

rding $100

tatute ma

heme automa

randum in Opposit PA yma

GE Opp it 46 n.29 iting ¢ VM

a ae US 165 +7-68 914 V4

ker, 230 U.S 10, 346-51 (19] M

bras} 7 U.S. 196, 207 19]

rin ] >¢ | eded tl

Nor does EPA’s pattern and practice regarding

UAOs prevent federal courts from exercising their

discretion. In General Electric II], this Court affirmed

as satisfying due process requirements CERCLA’s

judicial review provisions, which provide for de novo

review of liability and review of remedy selection

ander an “arbitrary and capricious” standard. 362 F

Supp. 2d at 341-42. Now. GE argues that EPA's

pattern and practice of compiling the administrative

record creates an incomplete basis for a reviewing

iudge’s decision, thereby impairing the judge’s discre

tion. Specifically, GE argues that EPA’s practice of

excluding irrelevant and pre-decisional deliberative

documents from the administrative record results 1n

. skewed record. See GE Mem. at 57 But irrelevant

LeCarreaux, Civ.A.No. 90 1672. 1992 WL 108816 D.N.J. Felt

19. 1992), to support its argument that courts do not exercis

their judgment in awarding punitive or treble damages. Gk

Rep. at 32-33 & n.34 In Tannery, the court noted in a one-pagt

ypinion that the defendant had repeatedly refused to participat

in proceedings before the court. Indeed, the court noted that

‘oven if the summary judgment were not be granted, ths

‘court would grant default judgment in favor ol plaintiff as a

sanction » 1992 WL 1458802 at *1. Similarly, in

LeCarreaux, the court noted that because it had “received no

opposition,” it adopted the recommendation of a Magistrate

judge, who himself adopted the governments proposed finding

fact and conclusions of law in their entirety. 1992 WL 108816

1t *1. Unsurprisingly, the government proposed the maximum

lamages allowed under CERCLA. To be sure, both case:

represent instances of courts adopting EPA's suggested treble

and punitive damages But in each case, the defendants either

failed to oppose EPA's requested damages or altogether failed t

participate in the enfor ment proceedings. These cast

therefore, are unique in both the brevity of their analysis and

the lack of engagement displayed by the defendants, and do not

represent generally a failure by the courts to x ¢ Cise discret

regarding the imposition of ps nalties for section 106 violation

documents should be excluded from the recora—the

record should only include documents that the agency

“directly or indirectly considered.” See Maritel, Inc. ¢

Collins, 422 F. Supp. 2d 188, 196 (D.D.C. 2006); see

also James Madison Ltd. by Hecht v. Ludwig, 82 F.3d

1085, 1095 (D.C. Cir. 1996). And “an agency generally

may exclude material that reflects internal delibera

tions.” Maritel, 422 F. Supp. 2d at 196. Moreover, GE

has not demonstrated that EPA actually has

pattern and practice of excluding documents that

should be included in the record. Although GE ha

provided examples from two sites where an admin

istrative record was arguably incomplete, two

anecdotal examples do not form a pattern anda

practice. Cf Coser v. Moore, 739 F.2d 746, 751-52 (2d

Cir. 1984); Intl Bhd. of Teamsters v. United State

131 U.S. 324, 336 (1977). And even if the record wa

incomplete in those two instances, safeguards within

CERCLA ensure that a reviewing court could hav

supplemented the record. See 42 U.S.C. § 9613Q)(]

The Court is not persuaded, then, that EPA abus«

its stewardship of the administrative record and

hence rejects GE's assertion that courts are

prevented from exercising their discretion in a'

ing or denying penalties and fines

Finally, GE argues that EPA has _ purposefull

muddied the contours of the sufficient cause defens¢

thus keeping PRPs guessing whether they have suffi

cient cause in deciding not to comply with a UAO. 1

be sure, Ex parte Young problems may arise when

the imposition of penalties turns on the interpreta

tion of an imprecise legal standard. See Solid Stati

Circuits, 812 F.2d at 391. GE contends that Solid

State Circuits provided an “unambiguous call on EPA

LO provide the type of ruldance nece ary to provid

uthicent ( it] { defen ‘ wit . 1]

54a

certainty.” GE Mem. at 55." GE argues that EPA has

ignored this judicial command, choosing instead to

keep the sufficient cause defense vague. Solid State

Circuits, however, does not go as far as GE wishes.

There, the Eighth Circuit recognized that because

CERCLA had only recently been enacted, the term

“sufficient cause” had not yet been developed by EPA

or the courts. 812 F.2d at 391. The court noted that

“as the EPA and the courts face concrete cost

recovery and treble damage cases, section 107(c)(3) of

CERCLA fi.e., the sufficient cause defense] will

develop accordingly.” /d. at 391 n.11. In the mean

time, the court bypassed potential Ex parte Young

problems by shifting the burden---rather’ than

requiring the noncomplying PRP to show that it had

sufficient cause not to comply, the court required

KPA to show that the challenging PRP lacked suffi

cient cause. /d. at 392. Although the court noted that

KPA could have avoided this kind of burden-shifting

by enacting detailed regulations regarding the suffi

cient cause defense, the court did not issue the kind

of “unambiguous call” that GE suggests. In the end,

courts, not agencies, provide the conclusive interpre

tations of imprecise legal terms lhke “sufficient

cause.” See Marbury v. Madison, 1 Cranch 137, 177

(1803) (“It is emphatically the province and duty of

the judicial department to say what the law is.”)

Indeed, since Solid State Circuits, district courts

have given meaning to the term. See, e.g., Capital

Tax Corp., 2007 WL 2225900 at *13; Barkman, 1998

GE’s citation to Pearson v. Shalala, 164 F.3d 650, 660 (D.-«

Cir. 1999), in support of this same point is unhelpful. Pearson

considered an agency's failure to articulate reasons for taking

action, not an agency's failure to give definitional content to an

inalogous “safe harbor” term. GE does not argue that EPA

routinely fails to articulate reasons for issuing UAQO

Sha

WL, 962018 at *17. Hence, while EPA’s unwillingness

to issue guidance regarding the meaning of sufficient

cause may be poor policy, it does not constitute a

coercive pattern and practice. In sum, GIt has not

demonstrated that EPA practices whether consi

dered individually or together—are unconstitution

ally coercive under Ex parte Young, and that du

process challenge must accordingly fail

IV. Mathews v. Eldridge

That brings us to the primary due process chal

lenge GIS asserts, which must be assessed within the

framework of Mathews v. Eldridge. Both EPA and

GE propose broad rules for certain categories of

deprivations or government actions. But court:

approach due process claims with scalpels, not cleav

ers. See Hannah v. Larche, 363 U.S. 420, 442 (1960)

(“Due process’ is an elusive concept. Its exact boun

danies are undefinable, and its content varies

according to specific factual contexts.”). Moreover, the

parties’ proposed rules are not adequately supported

by the cases they cite, and hence the Court will not

adopt them

GE argues that due process requires a tnal-type

hearing for non-emergency, “adjudicatory” agency

decisions. GE Mem. at 10; Gli Reply Memorandum in

Support of its Summary Judgment Motion (“GE

Rep.”) at 23. GE insists that this Court held in

General Electric IV that issuance of a UAO is an

adjudicatory decision. See 2006 WL 2616187 at *15

n.3. Leaving aside whether issuance of a UAO 1:

“adjudicatory,” GE’s argument fails because it 1s a

legal proposition without legal support. Certainly,

adjudicative decisions require more individualized

process than do rule-making decisions. See United

States v. Fla. Hast Coast Ie 110 U.S. 224, 244

NON

(1973). And, to be sure, some cases contain dicta

suppvesting that the more an agency's decision resem

bles a judicial decision, the more the agency’s proce

dures should resemble judicial procedures. See, e.g.,

Hannah, 363 U.S. at 442; Logan v. Zimmerman

Brush Co., 455 U.S. 422, 433-34 (1982). But GE has

not cited to any cases holding that trial-type hearing:

are required for adjudicatory decisions, and this

Court therefore will not adopt GI’s proposed rule

i |

IPA, on the other hand, argues that “consequen

tial” deprivations cannot form the basis for a due

process challenge at all. EPA Opp. at 9-10. EPA

points out that some of the deprivations GE alleges

only occur because the marketplace values a PRP less

after HPA issues a UAO to that PRP. In support of it:

proposed rule, EPA relies on O'Bannon v. Town Court

Nursing Center, 447 U.S. 773 (1980), and Blum

Yaretsky, 457 U.S. 991 (1982). O'Bannon rejected a

claim by nursing home residents that they wert

entitled to a hearing before the government decert

fied a nursing home. Once the government decertified

the home, residents could no longer use thei

rovernment benefits there. The Court reasoned that

the residents did not have a due process’ claim

because they were only incidentally affected by the

governments decision. 447 U.S. at 787. Unlike the

incidentally-affected residents in O'Bannon, however,

UAQOs are issued directly to PRPs

selves affected by government action. Blum rejected

. who are them

the claim of Medicaid recipients that they were

entitled to greater process before a state-subsidized

hospital discharged them. The Court reasoned that

the recipients did not have a due process claim

because actions by the hospital did not constitute

“state action.” 457 U.S. at 1004-05. But UAOs are

issued by EPA itself and indisputably constitute state

} “fy ' } {)1

OnnNeclle {Joe |

ther hand, does apply, and it requ ‘Ss this

Court te

reject EPA’s argument. In Doehr, a statute

‘

provided

or ex parte prejudgment attachment of real estate

without notice to the affected party. The Suprem«:

Court noted that attachment “clouds title [and]

impairs the ability to sell or otherwise alienate the

property” and then held that these “consequence

were sufficient to ment due process protection. /d

1-12. Doehr therefore settles the question wheth

onsequentl i | nyurie myivy warrant due proce

carefully asse

deprn 7}

protection, even uf court:

due proces:

only to Andru

In Support. of this propos)

Supreme Court rejected

ukings claim aft he government banned the sal

eagle feathers, reasoning that s of future profit

at 65 (emphasis added). But Gl

slender reed upon which to res

1. takings (1.e., Just compensation

a due process c] “Property a

ust Compensation Clause is defin

the due process

le Lakes, 95 F.3d

is therefore inap

narrow ly

hat a PRP suffers a deprivat

PRP elects not

KPA contends

uffer injurie:

thi ‘levant deprivation

mncomplance because the parties agree

leprivation at compliance

‘less. GE submits that even though

at noncompliance, 11

;

anytinie

; t interpre

dverse AP Si i ; nmvpahy “Oo { xample

ecurities

ivestigall

mpanys

ne Sam W OUL

\dmiunistration

oncompiial

differences

impact of noncompliance wit! LIAO from the

impacts ¢ oth ry

[Pha Tcl

‘xpert re rc TF } oo John

, } } }

Jason Johnston. Dr. Geweke, faced with a dearth

a regarding the impact of noncompliance on sto

—

y* . . + y Cc = | y YO PT “oT > | y

rice, instead examines the impa Or special not

‘tters” on stock price for 290 publicly-traded comp

1994. Geweke Report at 9 13. Dr. Geweke

Impact of special notice

for 89 companies from 1995 to 1998

ly sends special notice letters PRPs to

discussions

EPA's Statement

If settlement

UAO. Id

speci:

a contingent li:

ind cost of financing. Geweke Report

Oo multivariate regression analyses, D

lates what the impact on sto

‘

)

ia be if

extrapo

ymply with a [

} irket value th

: >¢

l irke LV.

of UAO noncompliance ratl

onducting a “counterfactual” analysis based on thi

impacts of special notice letters. The Court certainly

agrees that analysis of hard data is_ generally

preferable to projected data, and would be here. But

empirical evidence concerning actual instances o

UAO noncompliance is scarce because very fev

publicly-traded firms have chosen not to comply wit!

UAOs. EPA’s own rebuttal expert, Dr. Donald Siegel

testified that making inferences based on related

events was appropmate absent sufficient data

See Deposition of Donald Siegel at 173:19-175

Moreover, regression analyses are commonly used

evidence in cases requiring “extrapolatilon] from

sample of known data.” League of United Latin Am

Citizens v. Perry, 548 U.S. 399, 467 (2006); see als

Daniel L. Rubinfeld, Reference Guide on Multipl

Regression, in Reference Manual on Scientific Et

dence 181-85 (Federal Judicial Center

[“herefore, i regression

method of demonstrating

noncompliance on_ stock

mpirical dat

KPA next questions the assumptions

Dr. Geweke’s analysis. See EPA Opp. at 13-1

highlights three supposedly flawed assumptions

firms that are issued UAOs at multiple sites wil

decide not to comply with any UAOQO; that firms that

choose not to comply with a UAO will be assessed

maximum daily penalties for a five-year period (i.

that EPA will not bring an enforcement action unti

the statute of limitations is set to expire); and that

the markets do not discount contingent liabilitie

based on the likelihood of enforcement, the chanc

that a PRP will successfully defend an enforcemen

tion, or the possibility that a court will

54a

maller penalty than EPA requests. Although not

without some force, none of these alleged flaws is

sufficient to disqualify Dr. Geweke’s report. His

model does calculate potential impacts if a PRP

receives multiple UAOs and does not comply with

iny of them, but he reaches his main conclusion

that the average decrease 1n market value based on

UAO noncompliance is $76.4 million—by assuming

that a PRP decides not to comply with a single UAO.

See Geweke Report at J 158. Moreover, EPA does not

meaningfully dispute GE’s assertion that “[i]t is the

sovernment’s practice in bringing suit for UAO

noncompliance to seek the statutory maximum in

penalties and treble damages.” See GE’s Statement of

Undisputed Facts (“GE SUF”) at J 125 and EPA’s

Response to GE SUF at J 125. While the Court is

persuaded that EPA has a policy of seeking maxi

mum damages, GE has not offered any evidence to

suggest that EPA routinely waits as long as possible

before filing a cost recovery or enforcement action.

Che Court, then, will not hazard a recalculation of

Dr. Geweke’s formula. But it is clear that shorter

delays in filing cost recovery or enforcement actions

would result in smaller potential penalties, smaller

contingent liabilities, and, therefore, an average

market value reduction of less than $76.4 million

Similarly, while Dr. Geweke specifically acknowl

edges that the market may discount potential liabilt

ties based on possible defenses or a court’s decision to

impose smaller penalties than EPA seeks, he argues

that “the difference would be one only of magnitude.”

Geweke Report at J] 27. True enough, but because he

did not attempt to quantify how much markets would

discount potential liabilities, his $76.4 million calcu

lation is necessarily too high. The question at this

ce of the INnNGUITY however iS whether a depri\ i

Sullivan,

Geweke’s

deprived of

stock if tl

KPA al isserts tha

the Daubert standard

contends that Dr. John

hard data rather

il events.” But

not examine a

UAOs beca

reliable data

should have

than "elyY1n

irgument h

cites Support

experts to

Johnston’s 1

ther (albeit

the probative

equates UAO

EPA

newly-filed law

yne of the prim

response by PRP

tive for PRP’s to

work at the

Johnston

I hirect 1lvé

yt] iL ral

ufficientiy

itement automatical!

preclude the Injured Dp

itervorie Of activitie in

ride) |

XJ 4

mization

ihe deprivations that GE alleges are primar}

financial ones. Financial deprivations are less troub

ling because money can be recouped in a post

deprivation hearing. See David, 538 U.S. at 717. Bu

deprivations caused by UAOs are potentially s

large—on average $4 million for complying PRPs and

some substantial, unidentified amount for noncom

plying PRPs—that they may have collateral effects

UAOs could put scme PRPs out of business. Se

Geweke Report at J 21. For other PRPs, UAOs may

iffect operations, like whether to bid for new project

or to hire additional employees. See id. at | 25. Yet

or other companies, like GE, UAQOs are “not materi:

financial positions, results of operations,

liquidity.” See EPA SOF at J 45 (quoting GE Annua

Reports, 1997-2000). The variety of collateral effects

if any, precludes the Court from reaching a singl

conclusion about the significance of UAQOs for

PRPs. Still, a general conclusion is possible: althoug!

;

the private interests are less constitutionally signif

cant because they are primarily financial, they ar

sufficiently large and have enough potential col

teral effects to constitute weighty private interest

Aus

GE argues th: Ps are deprived of these va

interests for lengthy periods of time. Under sectio1

106(b), a complying PRP may seek reimbursement

“upon completion of the required action.” On averag

it takes three years to fully comply with a UAO

Rouhani Report at 7 6.2. Moreover, GE argues, EPA

claims the power unilaterally to delay “completion

In proceedings before the Environmental Appeal

Board (“EAB”), the body that reviews section 106(b

reimbursement petitions, EPA has at times success

fully argued that a petition should be dismissed

it ; ihe Patten htair

because of a PRP’s failure to obtain

f completion.” GE SUF at 9

proceedings, nowever, KPA contends correctly tnat

the statute does not require an EPA determination

that the clean-up is complete before a complying PRP

may file a reimbursement petition. See 42 U.S.C. §

9606(b); EPA Response to GE SUF at 9 91. If

complying PRP believes that it has completed

clean-up but the EAB declines the PRP’s reimburse

ment petition for failure to obtain a certificate of

completion, the PRP may appeal the EAB decision to

in Article III court. See Employers Ins. of Wausau, 52

F.3d at 662. There, the PRP can argue that the EAB

made legal errors (like accepting EPA’s argument

a certificate of completion was required) o1

factual errors (like finding the clean-up incomplete

Therefore, although Dr. Rouhani’s conclusion that

UAQOs take, on average, three years to complete is

persuasive, the Court is not persuaded that EPA can

inilaterally delay reimbursement proceedings |

efusing to issue a certificate of completion

GE argues that PRPs are also indefinitely “left in

imbo” if they ch« » not to comply with a UAO. EPA

has two ways to enforce UAOs under CERCLA. First

EPA can bring an enforcement action against

noncomplying PRP. Enforcement actions must be

brought within five years of a “violation.” See 28

8.C. § 2462. Second, EPA can complete the UAO

y Y

itself and file a cost recovery petition against the

PRP. Cost recovery petitions must be filed within

three years of completion for removal actions and

within six years of completion for remedial actions

12 U.S.C. § 9613(g)(2). GE argues that these statutes

limitations permit an unconstitutionally long

leprivation because they are paired with a “removal

r remedial action [that] may itself take years t

omplete” such that “the government may take

> 17

ri | ” ’ 4 “fh %

~5WePRPT Tim Hefore “III See (tk Viam | Te’

: his or ‘

halleng

‘lectric

a }

>_> = :

; a oe ae =

= homer 2

1989), aff'd sub nom. McNary v. Haitian Refugee ¢

Inc., 498 U.S. 479 (1991). GE urges the Court t

adopt the same kind of abstract approach that courts

use in both facial and as-applied challenges. See Tr

at 42:5-42:11; GE Mem. at 48 (citing Carey v. Piphus,

435 U.S. 247, 266 (1978)). Under this approach

courts “look generically at whether the kind of

inquiry that is involved is the kind that is error-prone

and the kind that would be benefitted by procedural!

fairness.” Tr. at 42:5-42:11. But the Court is not

persuaded that the abstract approach is the correct

one here. With the benefit of a full factual record — in

this case, following years of discovery—plaintiffs in

pattern and practice claims cannot rely on abstract

legal concepts alone. Although abstract legal concepts

may inform the Court’s analysis regarding the risk of

error, GE must also demonstrate that the current

procedures in fact result in an unacceptable rate of

error. It would make little sense to ignore the empiri

cal record altogether in favor of a_ hypotheti

oncern that the nsk of error may be too high

Abstract Concept

According to GE, the crucial element

EPA’s pre-UAO issuance process is a_ neutral

decision-maker. Although the Constitution does not

require a neutral decision-maker, see, e.g., Old Domi

nion, 631 F.2d at 968 (holding that an opportunity t

be heard by a contracting officer, the very person

deciding whether the plaintiff is a “responsible

contractor, satisfies due process), ample case law

supports GE’s point that a neutral decision-maker

an important constitutional safeguard, see,

Propert v. District of Columbia, 948 F.2d 1327, 133

(D.C. Cir. 1991). Therefore, the lack of a neutra

{

* ‘ -

nt. ld 1 30-36

that EPA erroneous

my was wWsueda

a clean-up pla

—

+—~

’

—

co]

Atle O1al!l

nacceptably high). And given the

ifter several years of exhaustive discovery,

ty of evidence demonstrating a higher rat

or all PRPs casts doubt on assuming

is high as four perces

> } a

Balanc LthyY

}

Having identified the privat iterest

nterests and risk of error, the final step in this du

process assessment is to balance these factors again

one another. See Mathews, 424 U.S. at 334. '

balancing process is dynamic—for example,

greater process could reduce the risk of error, it als

idds cost and delay, thereby burdening both gover1

ment and private interests. Here, GE has stated

preference for a full judicial hearing. See Tr. at 9

10:1. But courts seldom import the full judicial mod

the administrative decision-making proce

ieu of a full judicial hearing, GE has stated that tl

key ingredient for the additional process it thinl

necessary 1S a neutral decision-maker. Se

discussed above, courts have endorsed both

Rosen, 735 F.2d at 570, and detached

} Chemical

neutral decision-n

(‘herefore, the Court will undertake the

alancing to

y |

ace. 4

her or not a PRP complies. If the PRP complie:

then the average costs of compliance are $4 million

and the deprivation lasts for an average of three

years. If the PRP does not comply, then the average

size and length of the deprivation are substantial but

unclear. And whether or not a PRP complies, the

deprivations are primarily financial, although for

some PRPs the financial deprivations are sufficiently

arge to have collateral effects on operations. As for

the government interest, EPA does not issue UAQs in

emergency situations. But EPA nonetheless has a

substantial financial and administrative interest

Because UAOs are issued frequently, even minimal

additional process would tax EPA’s_ resources

Finally, the risk of error—as represented through the

ictual rate of error over many years in this pattern

ind practice case—is low. GE has provided concrete

vidence to establish that EPA has made errors 1

issuing five UAQOs, including three UAQOs issued t

GE itself. Assuming that GE has plumbed for error

111 68 of the UAQOs that it has received, and assuming

hat GE’s experience is representative, EPA makes

ome sort of error in roughly four percent yf

AO:

Mrs nsidel whetnel

suance hearing before a presiding officer withiu

EPA would so reduce the risk of error, without

induly burdening the government interest, as to be

onstitutionally required. At first glance, the burde:

n the government interest appears minimal. For any

iven UAO, a hearing before a presiding officer would

idd only weeks or a few months to an issuance

hat usually takes years. See Rouhani Report

3. Moreover, the costs of a single hearin:

presiding HA r r minimal neciall

Dreslaing OITICe! ire NinImMal, especiall

+ }

Schwetik

the Court must

idditional proce

issued 1,705 U

-85 months from

See Rouhani Re

fending : lr) eau tf en]

ymplying with a UAO and

imbursement. Tho

RPs under CERCLA

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been > 4 —~ Le = ~~

_ out . aad ee . —

a pwd ca > “ . pond - “ — oe

pu . hae : : =

rt > » +— mf ~ —“

4 i yy f —~ 4 ‘

~ 4 4

L - j a pone ~ — a ‘ $—

> = » ome af — ~ - ~

= ie | . —~ , <

+ > ~ 4 + 7

: > J a re - . -

4/ — r— a ‘ - >

— » aw Lome f : » + ' _

/ “ dna wet » 4

iste sites as to which EPA « te!

ay be, responsible for disposal of hazard

a factory building in Hoboke: w Jer

GE made mercury vapor lamp n the 19

ther lighting products until the factory was sold

1948; 2) two manufacturing facilitis n Hudson ]

nd Fort Edward, New York, where GE discha

PCBs into the Uppe! Hudson River well 1

. 7] yy | 7 ¥ =

and 3) Fletcher Paint Worl lilt

hese waste site ind GI rol ck

contamination of the te hes a

isted on the NPI See 40 C.F.R. } 4018

icknowledges tnat these {

the stage where remedial a

nplement & VI]

1adeead kK \

GE | ClmmlOovVvVa ed iL]

Vaste Sif (J hk’, l 1QQ |

maintall secur I riopdo!

vemporary vacuati ind I

residents, and proviat Ompiet nant

building. Am. Comp! 33. On Api

yrdered GE to demolish 1 fact

Hudson River facilities, EPA ha ted 4

the Hudson River on t National Pr

} Superfund site du PCH lischa

river. ld . Gl led

} . project rit ( ni \

hundred Or million tf aol ple

| (+t helieve WPA VV I ete ‘ | L]

t these project itself Decause r th orl

nad technological challeng yu]

ea li i, “TI ead (x! } We

ke CERCLA iteral orders rep?

’ nplem j

CO } }

e CERCLA re 1] blo]

mit 1] nistrat Ul

itil | ise ine | ] | ( (

ot rin lI rie te | }

ining! )] (

rae! ul¢ / i j ‘

igmel!

: il |

(

a I

)

(

( ie | | 1a

t | }

the

1e]

Aa’

tity a specific statutory

yovernments sovereign

DroVy

Im mMmunit

»¢ 5

tnat walve:

from suit.” Clinton County Comm ’rs v. EPA, 116 F.32

1O18. 1021 (3rd Cir. 1997) (en banc) (citations omitted

finding no subject matter jurisdiction unde

»©.C. 9 1331 to raise pre-enforcement challenge

tion 106 order ee Kokkonen Guardian Life [7

11 75. 377 (1994): United Stat

CTWOOd ee 234. 86 (1941) if ] wel] ett

cnatl uch waive! of immunity must De ‘unequlvor 1]

xpre ed,” United States v. Nordic Village, In ‘)

> 1. 1992) (quoting l/nited Stat Mitch

5 | » 038 (L980 nd are t onst

rictiy TAN ! | t} ‘ quot

Ta i 51

CHR

ouperiund Amel] mel! no} 1A

ARA iddi tne timi! pl

vl that le] udIcI

allen: ren remedial I |

le] U i ( \ I PA ‘

rae { [ |

iorcem«es Tt

letermil netne cul

KE RCLA | I ( nro}

( at na mina tnat t

located inl il ni tral

el! [ rice { il] I Gert

t n Wi

hatcive PISLol }

if {

lQIMS ar) atftlorded me ining! il re i

hunder isa rL7L 4 oal Co at Li A. O10 LJ } AGILE,

1994) (citations omitted): see also Block v. Communit

Nutrition Institute 167 U.S. 340, 35] 1984) (pre

umption of judicial review of agency

intent to preclu

ACLIONS IS OV

“ . . |

ye “whenever the COnPpressional!l

review 1s fairly discernable in the statutory scheme

ased on the langzuage structure, purpos and |e

lative history of section 113Ch) and exten

deral case law applying it. the Court concludes th

onvre intended to preclude judicial rev) of (ri

road, pre-enforcem« nt constitution

ERCLA’s administ) ler |

le) to CKERCLA fo!

rt mMNnalVS] | 4 Is

Dp untill Drou D uiien

Kederal M f | Health ‘ it

) | ‘ | Mine | i

ind requ)

i | |

‘

Vi)

federal district court seeking — pre-enforcemer

injunctive relief. Raising the same “Hobson's choice

due process argument that GE asserts here, the min

owner contended that

requiring [mine operators] to challenge MSHA

interpretation of 30 U.S.C. § 813C) and 30 CER

pt. 40 through the statutory-review process

would violate the Due Process Clause of the Fifth

Amendment, since the company would be forced

to choose between violating the Act and incurring

possible escalating daily penalties, or, on thi

other hand, complying with the designation

suffering irreparable harm

Thunder Basin, 510 U.S. at 205

The Supreme Court found that this constitutiona

challenge was precisely “the type Congress tntended

to be reviewed within the statutory structure.” /d. at

212. The Court thus held that the Act precluded dis

trict court jurisdiction over the owner's pre-enforcement

claims, including its constitutional challenge, becaus¢

such claims must go to the Commission first, an

then to the court of appeals for judicial review

\s for petitioner's constitutional claim, we agre

that “[aJdjudication of the constitutionality of

congressional enactments has penerally been

thought beyond the jurisdiction of administrativ:

agencies.” This rule is not mandatory, however .

The Commission has addressed constitutional

questions in previous enforcement proceeding:

Kven if this were not the case, however

petitioner’s statutory and constitutional claim

here can be meaningfully addressed in the Court

yf Appeal

Lo4da

Id. at 215 (quoting Johnson v. Robison, 415 U.S. 361,

368 (1974)). The Court concluded that “the Mine Act’s

combined with

comprehensive enforcement structure,

the legislative history’s clear concern with channeling

and streamlining the enforcement process, establishes

a ‘fairly discernable’ intent to preclude district court

review in the present case.” /d. at 216. The Court

therefore rejected the mine owner’s attempt to

circumvent the Mine Act’s review provisions by pre

emptively challenging the constitutionality of the Act.

Id.

This case falls well within the rationale of Thunder

Basin. The Mine Act. and CERCLA have similar

comprehensive statutory schemes. The former contains

a number of incentives “to compel immediate

comphance with the Mine Act provisions through the

use of mandatory civil penalties, discretionary civil

penalties, and other sanctions.” /d. at 204. Indeed, a

mine operator who fails to comply with a citation can

be assessed $5,000 per day pending compliance. /d. at

204 n. 4 (citing 380 U.S.C. §§ 814(a), 815(a)). Likewise,

CERCLA contains provisions which allow EPA to

compel compliance with its orders through = civil

penalties up to $27,500 per day of non-compliance.

See 42 U.S.C. § 9604(e)(5) bb); see also Bedford

Affiliates v. Sills, 156 F.3d 416, 427 (2nd Cir. 1998)

(CERCLA “was put in place to aid the expeditious

resolution of environmental claims. To accomplish

this objective Congress employed incentives — for

potentially responsible parties to settle and strong

disincentives for non-settling potentially responsible

parties.”).

Fach act streamlined respective health and safety

requirements. Thunder Basin, 510 U.S. at 211 (“The

1977 Mine Act thus strengthened and streamlined

L5S5a

health and safety enforcement requirements.”); EJ

Du Pont De Nemours & Co. v. Starzyk, 1990 WL

205823, * 1 (N.D. Ill., Nov. 26, 1990) “CERCLA was

passed in 1980 to streamline and strengthen the gov

ernment’s role in cleaning up hazardous” waste

sites.”). Originally, however, both statutes were

deemed inadequate to compel compliance, and there

fore Congress amended each in an effort to limit

initial judicial review and strengthen incentives for

compliance. Compare Thunder Basin, 510 U.S. at 210

n.14 (“Under existing legislation, civil penalties were

not always mandatory and were too low to compel

compliance, and enforcement. was hobbled by a

cumbersome review process.”) with United States v.

Colorado, 990 F.2d 1565, 1570 n. 6 (10th Cir. 1993)

(“Congress amended CERCLA in 1986 by enacting

SARA after realizing that CERCLA was ‘inadequate’

to address the environmental threat presented by

abandoned hazardous waste sites.” (citations omitted)).

Expedition and speed are thus critical goals for

protecting each statute’s respective constituency

miners under the Mine Act, and the public and the

environment under CERCLA. See Thunder Basin,

510 U.S. at 211 (“Concluding that ‘rapid abatement of

violations 1s essential for protection of miners,’

Congress accordingly made improved penalties and

enforcement measures a primary goal of the [Mine]

Act..”); Pritikin v. Dep't of Energy, 254 F.3d 791, 794-95

(9th Cir. 2001) (“CERCLA was enacted to protect and

preserve public health and the environment by

facilitating the expeditious and efficient cleanup of

hazardous waste sites.”). Moreover, both statutes

allow for judicial review in federal courts, where

review of agency action is governed by similar

standards. See 30 U.S.C. § 815(€a)(1)-(2) (review in

courts of appeals where agency action will be upheld

Looa

‘

{ “substantially supported” by the record); 42 U.S.C

9613¢h)-G) (review in district court where agency

ction will be upheld if not arbitrary and capricious)

And lhke CK RCLA, the Mine Act has been construed

as “precludl[ing] district court jurisdiction over [] pre

enforcement challenge[s].” Thunder Basin, 510 U.S

it POT. see Southern Pines

Associates

Cy x QI] Pd

‘ fates, « ka au (

v. United

113. 716 (4th C

ir. 1990) (“In 1986

Congress added a provision to CERCLA which

specifically precludes federal jurisdiction over pre

enforcement remedial action.”

Furthermore, GE and the mine owner in Thund

Basin assert essentially the same due process challeng:

to a statutory structure that precludes pre-enforcement

challenges to agency orders, yet

parties to potentially stiff fine

with such orders;

specter oft

subject s attected

for non-compliance

each complains. of the

intolerable “Hobson’s choice

regarding the dilemma of either complying with an

unreviewable ayency order or risking stiff penalties

Compare Thunder Basin, 510 U.S. at

Compl. {| 4. To determine whether

CERCLA precludes initial review

indeed,

a Coercive.

Lae. with Am

section 113¢Ch) of

of GE’s constitu

tional challenge, then, the Court is guided by Thunder

Basin to the statute’s language

structure, purpose

and legislative history, and to whether GE’s

in be afforded

laim

1 meaningful revi it a later p

ll. Section 113

The “Timing of 1

tates as follow

No Federal court hall have urisdiction unde

Federal law other thar

mn under

Title 28

ecLlion 1332

relating

to diversity

or under St: Which is applicable

mmf na YIDI ; a "

hurisdiction)

role

lola

of this title (relating to cleanup standards) t

review any challenges to removal or remedial

action selected under section 9604 of this title, or

to review any order issued under section 9606(a)

f this title, in any action except one of the

following [listed five exceptions]

12 U.S.C. § 9613(h). “The CERCLA statutory scheme,

as amended by SARA, merely serves to effectuate a

delay in a plaintiffs ability to have a full hearing on

the issue of hability.” Barmet Aluminum, 927 F.2d at

295: see ARCO Environmental Remediation, LLC ¢

Dep't of Health and Quality of Montana, 213 F.3d

1108, 1115 (9th Cir. 2000).

GE claims that it is not challenging any specific

order or removal action, but rather is making a broad

(indeed, somewhat abstract) challenge to the CERCLA

statutory scheme that somehow falls outside section

113¢Ch):

Although GE is not here challenging any specifi

order issued pursuant to the unilateral orders

provisions, GE is and will continue to be

deprived of its liberty and property by reason of

being forced to comply with these provisions

Accordingly, GE seeks a declaration by this

Court sustaining GE’s basic rights guaranteed by

the Constitution

Am. Compl. J 7. GE admits that it “has been a victim

of and is threatened with this unilateral order

Under section 113(b) of CERCLA, “the United States distri

courts shall have exclusive original jurisdiction over all con

troversies arising under” CERCLA, except as limited by section

113(a) and 113(h). The five enumerated exceptions to the

purisdictional bar are enforcement or cost-recovery actions filed

by EPA or by a private citizen. There is no contention that ar

if the five exceptions apply here

L58a

regime.” Id. J 30. But although GE details at length

three hazardous waste sites (each on EPA’s National

Priorities List) where EPA has deemed GE to be

potentially responsible or liable for cleanup costs, see

id. JJ 30-47, it insists that it only refers to them as

“examples illustratling] these unconstitutional depri-

vations, both existing and threatened.” Jd. at 30.

Notwithstanding GE’s ardent claim that it is not

challenging specific EPA orders, it is apparent that

GE's challenge to CERCLA nonetheless falls within

the section 113(h) prohibition of “any challenges,” “in

any action,” to EPA removal or remedial action or to

“any” section 106(a) order.’ The language of section

113(h) reflects the broad intent of Congress strictly to

limit judicial review of EPA enforcement actions or

orders. Congress employed the broad term “any”

three times in section 113th), thereby casting the

prohibition on pre-enforcement judicial review in

sweeping terms.

‘In its opposition brief, GE goes to great lengths to recast its

challenge as one to EPA’s interpretation and application. of

CERCLA, see, e.g., Pl. Opp. to Def. Mot. to Dismiss at 17, 53, in

an obvious effort. to avoid both section 113(h)’s jurisdictional bar

to challenges to specific orders and fundamental problems with

the merits of a facial challenge to the constitutionality of

CERCLA. GE’s hybrid attack on a broad category of EPA orders

is to no avail, however, as the Court concludes that both as

applied and facial challenges to the CERCLA administrative

orders regime are covered by the section 113¢(h) jurisdictional

limitation under the circumstances present here, and hence

GE’s novel articulation is as well. See, e.g., GDF Realty v

Norton, 169 F. Supp. 2d 648, 656 (W.D. Tex. 2001) ( “A plaintiff

can either challenge a// applications of a statute (i.e., a facial

challenge), or the statute as-applied to the plaintiffs particular

conduct-but he cannot take the middle ground and challenge the

statute as-appled to a general class of activity into which his

conduct also falls.” (emphasis in original))

159a

“Section 113(h) is clear and unequivocal. It amounts

to a ‘blunt withdrawal of federal jurisdiction.”

McClellan Ecological Seepage Situation (MESS) v.

Perry, 47 F.3d 325, 328 (9th Cir. 1995) (quoting North

Shore Gas Co. v. EPA, 930 F.2d 1239, 1244 (7th Cir.

1991)); Oil, Chemical and Atomic Workers, Int'l Union

v. Richardson, 214 F.3d 1379, 1382 (D.C. Cir. 2000)

(same). As the Ninth Circuit explained, “the unquali-

fied language of the section precludes ‘any challenges’

to CERCLA Section 104 clean-ups, not just those

brought under other provisions of CERCLA.” MESS,

47 F.3d at 328. Section 113(h) “explicitly states that

federal courts shall not have jurisdiction to review

‘any challenge’ except for those enumerated.” South

Macomb Disposal Auth. v. EPA, 681 F. Supp. 1244,

1249-50 (E.D. Mich. 1988). “It simply cannot be denied

that Congress intended to preclude all litigation which

would delay, or worse, halt governmental efforts to

clean up hazardous waste sites.” O1l, Chemical &

Atomic Workers Int'l Union v. Pena, 62 F. Supp. 2d 1,

5 (D.D.C. 1999), affd, 214 F.3d 1379 (D.C. Cir. 2000):

see also Clinton County Comm'rs, 116 F.3d at 1024

n.l (noting Congress's “commitment to preventing a//

judicial interference with remedial actions” under

CERCLA (emphasis in original)).

When Congress has purposefully employed the

term “any” in other statutes, the Supreme Court has

recognized the comprehensive scope that the word

suggests. In construing the language “any property”

in a drug forfeiture statute, the Court stated:

Congress could not have chosen stronger words

to express its intent that forfeiture be mandatory

in cases where the statute applied, or broader

words to define the scope of what was to be

forfeited.

160a

United States v. Monsanto, 491 U.S. 600, 607 (1989).

“Read naturally, the word ‘any’ has an expansive

meaning, that is, ‘one or some indiscriminately of

whatever kind.” United States v. Gonzales, 520 U.S.

1, 5 (1997) (quoting Webster’s Third Intl Dictionary );

see also United States v. James, 478 U.S. 597, 605,

(1986) (““Congress’ choice of the language ‘any damage’

and ‘liability of any kind’ further undercuts a narrow

construction” (emphasis in original)); Affiliated Ute

Citizens v. United States, 406 U.S. 128, 151 (1972)

(“by the repeated use of the word ‘any” in the statute,

the term is “obviously meant to be inclusive”).

The sweeping nature of Congress’s choice of the

terms “any challenges “ and “in any action” supports

the conclusion that section 113(h) precludes pre-

enforcement due process challenges to CERCLA, and

specifically to the procedures available to EPA

to compel compliance with its orders. Congress

“could not have chosen stronger words to express its

intent . . . or broader words to define the scope,”

Monsanto, 491 U.S. at 607, of the challenges to

remedial or removal action or section 106 orders

precluded under CERCLA’s judicial review provision.

Courts of appeals have also broadly construed the statutory

term “any” to mean “all.” See, e.g., Flue-Cured Tobacco Coopera

tive Stabilization Corp. v. EPA, 313 F.3d 852, 859 (4th Cir

2002) (“[T]here is no sufficient reason to give the word ‘any’ a

meaning other than its ordinary English usage. That meaning

is: ‘to any extent; in any degree; at all.’ This meaning has been

adopted by the courts.”) (quoting Webdster’s Third New Int'l

Dictionary), Southern Co. v. FCC, 293 F.3d 1338, 134S (11th Cir

2002) (plain meaning of “any” is “all”); Jn re Jove Engineering,

Inc. v. IRS, 92 F.3d 1539, 1554 (11th Cir. 1996) (statute “uses

the broad term ‘any’ which encompasses all forms of orders” and

“encompasses any type of order, whether injunctive, compensa

tive, or punitive”) (emphasis in original)

l6la

Indeed, in McNary v. Haitian Refugee Center, 498

U.S. 479 (1991), the Supreme Court reasoned that if

Congress had wanted to prohibit review of constitu-

tional due process and procedural challenges under

the Immigration and Nationalization Act’s judicial

review provision, rather than merely barring review

of individual deportation orders, Congress could have

used just such “expansive language”—for example,

by explicitly barring review of “all causes” arising

under the statute. See 498 U.S. at 494. That is

precisely the type of all-encompassing language

Congress has in fact employed in CERCLA’s timing of

review provision.

This reading of section 113(h) is supported by the

legislative history. The Chairman of the Senate

Judiciary Committee, which drafted section 113(h),

explained:

The timing of review section is intended to be

comprehensive. [t covers all law-suits, under any

authority, concerning the actions that are per-

formed by EPA. The section covers all issues that

could be construed as a challenge to the response,

and limits those challenges to the opportunities

specifically set forth in the section.

132 Cong.Rec. $14929 (daily ed. Oct. 3, 1986). Such

an intent to prohibit review of “all lawsuits” under

“any authority,” and to cover “all issues,” supports the

conclusion that section 113(h) bars GE’s challenge to

CERCLA.

Nor can GE circumvent section 113(h) by framing

its claim as a constitutional challenge rather than a

statutory challenge. The Eleventh Circuit recently

rejected the idea that there is somehow a difference

under section 113(h) between a constitutional and a

statutory claim:

162a

The language of section 113(h) does not distin-

guish between constitutional and _= statutory

challenges; instead, it delays judicial review of

“any” challenges to unfinished remedial action... .

Because ‘Congress did not add any language

limiting the breadth of that word,’ .. . “any”

means “all.” The use of the word “any” compels

us to conclude that Congress meant to bar

jurisdiction over constitutional challenges as well

as statutory claims challenging the adequacy of a

remedial plan.

Broward Gardens Tenants Assoc. v. EPA, 311 F.3d

1066, 1075 (11th Cir. 2002) (citation omitted); see also

Clinton County Comm’rs, 116 F.3d at 1026 (finding

that “the plain language of § 9613(h) precluded the

exercise of jurisdiction over a challenge to an ongoing

CERCLA removal or remedial action under any

federal law” (emphasis in original)); South Macomb,

681 F. Supp. at 1249-50 (“Reading the language of §

9613(h) for its everyday meaning supports the notion

that this subsection prohibits constitutional as well

as statutory challenges until the time prescribed by

the statute.”).

Constitutional challenges to CERCLA brought

pursuant to 28 U.S.C. § 1331 are not one of the five

enumerated exceptions in section 113(h). In fact,

other courts have ruled that pre-enforcement due

process challenges are precluded. “Most courts have

flatly concluded that because section 9613(h) bars

pre-enforcement judicial review of ‘any challenges to

removal or remedial actions selected,’ it also bars pre-

enforcement judicial review of constitutional challenges

to CERCLA itself.” Farmers Against Irresponsible

Remediation (FAIR) v. EPA, 165 F. Supp. 2d 253, 262

(N.D.N.Y. 2001) (section 113(h) bars pre-enforcement

First Amendment challenge).

L63a

For example, in Barmet Aluminum, the plaintiff

sought injunctive relief to prevent EPA from listing

its site on a National Priority List and asserted that

“because its challenge to CERCLA is constitutional,

the general proscription against pre-enforcement

review is inapplicable.” 927 F.2d at 290. Just as GE

argues here, the plaintiff asserted “that this statutory

prohibition applies only to ‘administrative decisions’

and: not ‘constitutional challenge[{s] to the entir«

CERCLA statutory scheme.” /d. at 292. The Sixth

Circuit rejected that construction of section 113(h)

EPA argues that Congress passed 9613(h)

foreclose interpretations allowing pre-enforcement

review of constitutional challenges. We agree

Notably, the statutory language of section 9613(h

does not include any explicit provision

constitutional challenges

Id. at 292-93. see also Broward Gardens, 311 F.3d a

1068 (“On appeal, plaintiffs do not assert that their

claims fit within any of the [five] statutory exception

to section 113(h), but instead contend that section

113(h) does not apply to begin with, because Sec

tion 113(h) does not apply to constitutional claims

We disagree.”); Aztec Minerals Corp. v. EPA, 1999

WL 969270, at * 3 (10th Cir. 1999) (due proces

challenge barred because constitutional claim not

within exceptions identified in section 113(h)); South

Macomb, 681 F. Supp. at 1251 (“Congress intended

that federal courts not have subject-matter jurisdic

tion to hear constitutional challenges to CERCLA at

this stage of the proceedings under the Act

The fact that section 113(h) ex, y pre

under 28 U.S.C. § 1332, but make no mention of jurisdicti

under 23 LJ ss ‘ 133] ugvesti n iLtent nal

164a

III. Structure and Purpose of Section 113(h)

Of course, GE does not explicitly seek to overturn

or enjoin EPA action or an EPA order, but instead

simply seeks a declaratory judgment that sections

106, 107(c)(3) and 113(h) are unconstitutional. If it

prevails, however, then naturally it would assert that

ruling as a shield to invalidate or prevent section

106(a) orders by EPA. There is no doubt, then, that

GE is, in effect, attempting to invalidate EPA orders

that have been or may be issued to it. The vehicle for

invalidating or preventing the enforcement of such

orders is not determinative—rather, it is the end

result sought that is critical, and here GE plainly

seeks to invalidate or prevent enforcement of EPA

section 106(a) orders.’ GE’s due process challenge, if

successful, would have the effect of hindering (or

outright preventing) EPA from enforcing orders and

response actions and thereby from ensuring the

complete remediation of the three sites detailed in

the amended complaint (and arguably countless

others as well). That result would be contrary to

Congress's intent in crafting section 113(h), as it is

“fairly discernable” from the structure and purpose of

the statute that Congress intended a broad, pre

Congress so as to preclude pre-enforcement actions based on

federal question jurisdiction .

Cf. United States v. Any and All Radio Station Transmission

Equip., 207 F.3d 458, 463 (8th Cir. 2000) (“Whichever way it is

done, to ask the district court to decide whether the regulations

are valid violates the statutory [review] requirements. As [we

have stated], |[wjhere exclusive jurisdiction is mandated by a

statute, a party cannot bypass the procedure by characterizing

its position as a defense to an enforcement action. The exclusive

jurisdiction of the courts of appeals cannot be evaded simply by

labeling the proceeding as one other than a _ proceeding for

judicial review.”) (citations omitted)

lod5a

enforcement constitutional challenge like GE's

precluded.

The primary goal of section 113(h) is to prevent

delays caused by legal challenges that could slow or

interrupt the cleanup of hazardous waste sites. See

Barmet Aluminum, 927 F.2d at 291 (CERCLA’s

“primary purpose is ‘the prompt cleanup of hazardous

waste sites.”) (quoting J.V. Peters & Co. v. EPA, 767

F.2d 263, 264 (6th Cir. 1985)). As the Third Circuit

has stated en banc:

The purpose of [§ 9613(h)] is to ensure that there

will be no delays associated with a _ legal

challenge of the particular removal or remedial

action selected under section [9604] or secured

under section [9606]. Without such a provision,

responses to releases or threatened releases of

hazardous substances could be unduly delayed

thereby exacerbating the threat of damage to

human health or the environment

Clinton County Comm'rs, 116 F.3d at 1024 (citing

H.R. Rep. No. 99-253(V), at 25-26 (1985)). “In enact

ing section 113(h), ‘Congress intended to prevent

time-consuming litigation which might interfere with

CERCLA’s overall goal of effecting the prompt cleanup

of hazardous waste sites.” Costner v. URS Consul

tants, Inc., 153 F.3d 667, 674 (8th Cir. 1998) (quoting

United States v. City and County of Denver, 100 F.3d

1509,1514 (10th Cir. 1996)); see Barmet Aluminum,

927 F.2d at 293 (“Judicial review itself slows the

process down.””) (quoting Schalk v. Reilly, 900 F.2d

1091, 1097 (7th Cir. 1999)). The D.C. Circuit has noted

“that pre-enforcement review would be a significant

obstacle to the implementation of response actions

and the use of administrative orders.” OCAW, 214

F.3d at 1382 (citing S. Rep. No. 11, 99th Congress 1, 58

’

lb6a

(1985)). The goals underlying section 113(h), moreover,

are equally at stake whether a pre-enforcement due

process challenge seeks review of a specific HPA

order or raises a broader attack on the statute:

If the court were to consider the constitutionality

of CERCLA, an injunction would have to issue to

prevent any potentially unconstitutional actions

from taking place. Such injunctions are precisely

the type of impediment that the preenforcement

review was meant to prohibit.

South Macomb), 681 F. Supp. at 1251]

The structure of CERCLA evidences congressional

intent to preclude a constitutional challenge to the

statute while removal or remedial action, or a section

106 order, is pending enforcement. “On its face, then,

section 113(h) precludes contemporaneous challenges

to CERCLA cleanups.” MESS, 47 F.3d at 328

Allowing peripheral challenges to proceed while a

response action is pending completion or enforcement

would undermine the roal of rapid abatement of

hazardous waste sites:

Section 113(h) protects the execution of a

CERCLA plan during its pendency from lawsuits

that might interfere with the expeditious cleanup

effort. This result furthers the policy underlying

CERCLA by allowing a quick response to serious

hazards. Congress concluded that the need for

such action was paramount, and that peripheral

disputes . . . may not be brought while the

cleanup is 1n process

Id. at 329 (emphasis in original) (citation omitted). As

the Seventh Circuit has observed, “[tlhe obvious

meaning of this statute is that when a remedy has

been selected, no challenge to the cleanup may occur

prior to completion of the remedy

900 F.2d 1091. 1095 (7th Cir. 1990)

One also cannot ignore the context of this htiga

tion, and specifically GE’s ongoing interaction with

KPA over remediation at several locations, especially

the contentious debate over the Hudson River cleanup

GE raises this broad challenge while three site:

where EPA deems GE to be a PRP are currently

in the process of remediation. EPA has sought

“voluntary performance” by GE of a remedy that EPA

selected and approved for clean-up work at the

Fletcher Paint Works site in New Hampshire. Am

Compl. 9 46. GE also believes that “EPA will soon

issue a unilateral order compelling GE to do the

work.” /d. EPA has served a section 106 order on GE

for remediation of GE’s former Hoboken, New Jersey,

lamp factory, and has ordered GE to demolish thi

factory. Id. J 34. Finally, GE alleges that “the EPA

recently announced that it is now considering dredg

ing projects” to remove PCBs from the Hudson River,

a project GE contends will take a decade and cost

hundreds of millions of dollars to complete, and as to

which GE fears “EPA will invoke CERCLA’s unila

teral orders regime and require GE to implement

massive dredging remedy.” Id. 44] 41-42." The fact

that GE believes that EPA response actions or order

are about to be imposed only underscores the concern

that GE brings this sweeping attack on CERCLA

In fact, EPA filed its Record of Decision (“ROD”) with a fina

remedial plan for the 40-mile stretch of the upper Hudson River

on February 1, 2002. The plan calls for dredging 2.65 million

cubic yards of contaminated sediment, in order to remove 75,000

tons of PCBs from the river. See ww-.epa.gov/region02/new

2002/02005 htm

lvla

prevents these or any other plaintiffs from refiling

this [constitutional challenge] or a similar complaint

once the cleanup at the site is completed.”). Several

courts have held that pre-enforcement due process

challenges (similar to GE’s) to other environmental

statutes—statutes modeled on CERCLA—can be

reviewed meaningfully after EPA seeks enforcement.

See Hoffman Group, Inc. v. EPA, 902 F.2d 567, 570

(7th Cir. 1990) (“Hoffman will have an opportunity to

present any constitutional arguments if the admin

istrative law judge approves the proposed EPA

penalty or if the EPA seeks judicial enforcement of

the compliance order.”); Southern Pines Associates v

United States, 912 F.2d 713, 716-17 (4th Cir. 1990)

(““(Wle are persuaded that Congress meant to

preclude judicial review of compliance orders under

the [Clean Water Act] just as it meant to preclude

pre-enforcement review under [the Clean Air Act]

and CERCLA. . .. Southern Pines and VICO will have

an opportunity to make their constitutional arguments

at any enforcement proceeding before they are

subjected to any injunction or penalty.”); see also

Laguna Gatuna, Inc. v. Browner, 58 F.3d 564, 566

(10th Cir. 1995) (“Judicial review of every unenforced

compliance order would undermine the EPA’s regula

tory authority.”). So, too, GE can obtain judicial

review of its due process challenge before any

injunctions, fines, penalties, or punitive damages are

imposed—and hence before there is any deprivation

of a property interest. As the Supreme Court made

clear in Thunder Basin, 510 U.S. at 215, although

delayed, constitutional challenges to statutes can still

receive meaningful review in federal court after

administrative action. This holds true for GE’s broad

constitutional challenge to CERCLA as well

nforcement judicial review under section 113(h), Gl

rames its suit as a facial constitutional ch:

rovisions of CERCLA. The federal courts of appeal

wever have rejected attempts to circumvent

udicial review limitations in other environment

tatutes by raising, under 28 U.S.C. § 1331, constit

tional challenges to the statute itself }

Vebraska Unite State 238 F.3d 946 (8th |

O01): Michigan Asso yf Hor and Sert

\our Shalala, 127 F.3d 496 (6th Cu weal

Vissou United State 109 F.3d 440 (Sth ¢

1997): Virginia v. United States, 74 F.3d 517 (4th C

1996). Indeed, the D.C. Circuit has emticized cle

. . j ‘ } }

laintiffs who attempt to Snort-circult the aadministl

BS om ~ > ” -¢ » ¢ oy Dace > ¢ y T + b-

V¢ lreview | proces: In a Statute DY iSting tne

] } e ’ ‘

mplaint differently SULT, Ru

10 F.3d 867. 876 (D.C. Cir. 200

1 } f 7

y ry ++ om mt { + +} ( ‘

YP LTiial RARE SE pJ UC i t i il i 7

lai review provi mn oY casting

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173a

avoid review in the court of appeals by challenging

the Act’s constitutionality in district court under

federal question jurisdiction: “There is simply no

impediment to the adjudication of constitutional issues

through petitions for direct review of final agency

action in the circuit courts.” Jd. at 523. Likewise, the

Eighth Circuit dismissed a similar attempt. “We

cannot accept the argument that Missouri sought

only to challenge the constitutionality of the statute

completely apart from EPA action.” Missouri, 109

F.3d at 441. That court reasoned:

EPA has issued five formal deficiency findings to

Missouri so far under the CAA. Missouri seeks to

nullify the effects of these actions by having the

sanctions they portend declared unconstitu-

tional. While it is true that Missouri’s complaint

questions the constitutionality of the overall

sanctions scheme of the CAA, this challenge is

not separate and apart from EPA action

Id. at 442.

GE’s amended complaint details EPA’s enforcement

actions under CERCLA, including response actions

and section 106 orders, with respect to alleged GE

hazardous waste sites. See Am. Compl. J{ 31-47.

Although GE labels these references simply as

“illustrations” of due process violations, it is difficult

to separate GE’s broader constitutional challenge

from these specific EPA actions. A facial challenge to

CERCLA, built on several “illustrations” of due

process violations relating to EPA’s remedial efforts

at specific sites, poses the same or even a greater

threat to EPA’s environmental response efforts as

does a challenge to a specific order. Simply raising a

facial challenge to a statute should not be a means to

avoid the statute’s prohibition on pre-enforcement

2 pes

L é ‘tal

review. In Michigan Assoc. of Homes and Services for

the Aging v. Shalala, the Sixth Circuit concluded that

a facial due process attack on Medicaid regulations

was not an exception to a provision delaying judicial

review:

The Association and an amicus attempt to avoid

{the judicial review limitation] by arguing that

the statute’s restrictive language applies only to

individual claims for benefits or constitutional

challenges that are intertwined with claims for

benefits. This facial challenge, they argue, should

be treated differently. We disagree. .. ee

purposes of exhaustion . .. would be undermined

by allowing the Association to avoid presenting

| its specific claims to the Secretary

127 F.3d at 500

The Supreme Court has similarly rejected the idea

that distinctions should be drawn under statutory

review provisions between substantive challenges to

the merits of an agency action and _ procedural

challenges that purport not to challenge a particular

agency determination. See Heckler v. Ringer, 466

U.S. 602, 614 (1984) (simply because a claim can be

construed as “procedural” does not make it cognizable

in district court under 28 U.S.C. § 13831). In

Weinberger v. Salfi, 422 U.S. 749, 760-761 (1975), tl

Court concluded that a constitutional challenge to the

Social Security Act was a “claim arising under” tl

Act even though it was in one sense also a claim

arising under the Constitution

Thus, whether a statute precludes or delays judicial

review of a nartieulay ‘-laim should not turn on some

artificial or clever distinction put forth by the party

ittempting to evade the statute’s judicial reviev

IVE

iijiVJa

limitation—whether constitutional versus statutory,

facial versus as-applied, or procedural versus subs

tantive. Section 113(h) draws no such distinctions-

it applies to “any challenges.” To import such a

distinction into section 113(h) for facial constitutional

challenges to CERCLA—or even for GE’s self-

described challenge to the “interpretation and appli

cation” of CERCLA—jignores the language and

purpose of section 113(h)’s postponement of judicial

[Soview.

y > > - } ’ - , B ~— i. > j v4

VI. Reardor VU. United oo tat

GE’s reliance on the First Circuit’s decision in

Reardon v. United States, 947 F.2d 1509 (1st Cir

1991) (en banc), is unpersuasive. That case addressed

a unique provision of CERCLA that allows EPA to

place a lien on property, which was the subject of a

challenge on due process grounds. The Court’s decisio1

is properly confined to that specific setting.

In Reardon, the EPA removed hazardous PCBs

from the Reardons’ property and then filed a notice of

lien on the property pursuant to 42 U.S.C. 9607(/) as

part of an effort to recover costs. See 947 F.2d at

1510. The Reardons then sought an injunction in

district court, claiming that “EPA’s imposition of the

lien without a hearing violated the due process clause

of the fifth amendment.” Jd. at 1511. The First Circuit

concluded that section 113(h) did not bar review of

due process challenge to CERCLA itself

The court construed section 113(h) narrowly,

observed that the challenge to the statute did

into the literal language of § 9613(h)”:

That section refers to “challenges to removal «

remedial action selected under section 9604 of

this title.” Under our reading, it divests federa

176a

courts of jurisdiction over challenges to EPA’s

administration of the statute—claims that EPA

did not “select[{]” the proper “removal or remedial

action,” in light of the standards and constraints

established by the CERCLA statutes. The

Reardons’ due process claim is not a challenge to

the way in which EPA is administering the

statute; it does not concern the merits of any

particular removal or remedial action. Rather, it

is a challenge to the CERCLA statute itself—to a

statutory scheme under which the government is

authorized to file lien notices without any

hearing on the validity of the lien.

at 1514 (emphasis in original). The court empha

sized that

it is important to make clear that we are not

holding that a// constitutional challenges involv-

ing CERCLA fall outside the scope of § 9613(h).

A constitutional challenge to EPA administration

of the statute may be subject to § 9613(h)’s

strictures. Such a claim may well be a “challenge[]

to removal or remedial action selected under

9604 of this title,” and may thus fall within

§ 9613(h)’s bar. We find only that a constitu-

tional challenge to the CERCLA statute is not

covered by § 9613(h).

at 1515 (emphasis in original

The statutory language of section 113(h) does not

itself distinguish between two types of constitutional

claims, one challenging the administration of CERCLA

and one challenging the statute itself. Although the

court in Reardon downplayed the fact that section

113(h) precludes judicial review of “any challenges” to

removal or remedial action “in any action” (except

’

‘ 7 ’

one of the five enumerated exceptions), the breadth ot

the statutory language cannot be ignored. The use by

Congress of such expansive, all-encompassing languag

undermines the view that there is some distinction

implicit within section 113(h) between a challenge to

the administration of the statute and a challenge to

the statute itself. Moreover, as is true of GE (which

attacks the administration and interpretation of

CERCLA by EPA), so, too, it is true that the Reardon

were in effect challenging EPA’s administration of

CERCLA—1.e., the choice by EPA to file a notice

lien on their property

The focus in Reardon was on an interpretation

the phrase “removal or remedial action selected

under section 9604” in section 113(h). The court found

that a due process challenge to the lien provision of

CERCLA did not fall within that language and thu

the federal courts were not divested of jurisdiction to

hear such a challenge. See 947 F.2d at 1515. Here, of

course, GE’s challenge is to the section 106 admin

istrative order regime, which is an express part of th:

limitation on judicial review set out in_ sectior

113(h)—no federal court shall have jurisdiction “to

review any order issued under section 9606(a) of thi:

title [] in any action ” Hence, Reardon is properly

confined to the unique lien provision challenge

there, and does not govern here

Importantly, the panel decision in Reardon reco;

nized that “the cleanup of the property is substantially

complete, so litigation will cause no delay.” Reardor

v. United States, 922 F.2d 28, 1990 WL 209207,

(Ist Cir. 1990). Thus, the setting was such that the

court could find that section 113(h) did not bar a pr

enforcement constitutional challenge to the lie

provision without concern that ab:

178a

hazardous waste site might be delayed. Of course, the

sites EPA has ordered or may order GE to remediate

are far from being cleaned up. Unlike Reardon, then,

where the property was substantially abated, this

case truly involves pre-enforcement judicial review.

Moreover, the actual harm to the Reardons—the

lien on their property—was an immediate deprivation

of a property interest that the court concluded could

not be effectively challenged when EPA brings an

enforcement action. The Reardons were immediately

deprived of a property interest—the unencumbered

use of their property—and that harm would continue

until the lien was released. As the Supreme Court

noted in Connecticut v. Doehr, 501 U.S. 1, 11 (1991),

subjecting property to a lien clouds its title and

impairs the owner's ability to sell or mortgage the

property. Indeed, the lien could tie up the property

for years before the owner could get a hearing. “Since

the government may take its own sweet time before

suing, and since the removal or remedial action may

itself take years to complete, the lien may be in place

for a considerable time without an opportunity for a

hearing.” Reardon, 947 F.2d at 1519.

Here, in contrast, the alleged harm to GE will not

occur until after EPA attempts to enforce its orders

in court. The penalties, fines, or punitive damages

GE fears under section 107 can only be imposed after

EPA seeks to enforce its orders in court, and even

then, the district court has discretion as to whether

fines and penalties will be 1mposed, and if so how

much. See 42 U.S.C. § 9607(c)(3). Hence, before any

fines or punitive damages can be imposed, there is an

opportunity for meaningful judicial review to consider

challenges or defenses to EPA action. See, e.g.,

Barmet Aluminum, 927 F.2d at 294-96: J.V. Peters &

179a

Co. v. EPA, 767 F.2d 263, 266 (6th Cir. 1985) (PRP

“can suffer no deprivation until the adjudication of

the section 107 litigation, however, and they will have

the full opportunity to argue liability at that time”)

GE’s broad challenge to CERCLA is different from

the challenge in Reardon, where the unique factual

circumstances appear to have caused the court to

impose a stricter standard for determining whether

Congress intended to preclude judicial review. The

court in Reardon construed 113(h) as completely

precluding judicial review, rather than merely post

poning it: “We read § 9613(h) in light of the Suprem¢

Court’s oft-repeated pronouncement that ‘wher

Congress intends to preclude judicial review of

constitutional claims its intent to do so must be

clear.” Jd. at 1514 (citing Webster v. Doe, 486 U.S

592, 603 (1988)). As explained in Webster, “l|wle

require this heightened showing in part to avoid the

‘serious constitutional question’ that would arise if a

federal statute were construed to deny any judicial

forum for a colorable constitutional claim.” 486 U.S

at 603. Because a judgment in EPA’s subsequent

enforcement action “would render moot the Reardons

due-process-based request for injunctive relief against

the filing of the lien, since it will decide whether o1

not the Reardons are lable under CERCLA.” the

court concluded that “the effect of section 113(h) is t

preclude review altogether.” 947 F.2d at 1515 n.1

Applying this “heightened showing” standard, th

First Circuit “dlid] not believe that the statute

expresses a clear congressional intent to preclude

the type of constitutional claim the Reardons are

making—a challenge to several statutory provisi

which form part of CERCLA.” Jd. at 1515

(;E’s constitutional clain

altogethe! Moreo\

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volved a constitutional «

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to a statute do not circumvent statutory limitations

on judicial review. See, e.g., Nebraska, 238 F.3d at

948: MAHSA, 127 F.3d at 499; Missouri, 109 F.3d at

442: Virginia, 74 F.3d at 522. Moreover, at least

three courts of appeals have ruled, contrary to

Reardon, that constitutional challenges are within

section 113(h)’s postponement of judicial review.

See Broward Gardens, 311 F.3d at 1070; Barmet

Aluminum, 927 F.2d at 293; Aztec Minerals Corp. v.

EPA, 1999 WL 969270, 198 F.3d 257 (10th Cir. 1999).

This weight of authority supports the conclusion that

GE’s pre-enforcement constitutional challenge to

CERCLA 1s barred by section 113(h).

CONCLUSION

Section 113(h) of CERCLA delays judicial review of

GE’s broad, pre-enforcement due process challenge to

the statute, which cannot be brought until EPA seeks

enforcement or remediation is complete. Under the

Supreme Court’s ruling in Thunder Basin, the lan-

guage of section 113(h), as well as its purpose, struc

ture and legislative history, make it “fairly discernable”

that Congress intended GE’s constitutional challenge

to be postponed. GE is not entirely precluded from

raising its due process challenge; it can obtain

meaningful review after EPA seeks enforcement of its

response actions or remediation plan, including section

106(a) orders. Thus, the Court concludes that section

113(h) deprives this Court of subject matter jurisdic

tion over GE’s challenge to CERCLA

Accordingly, EPA’s motion to dismiss Is $

separate order will be issued on this date

f »

oun oe P

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. j

nthe ‘

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| [ V ¢ | Li Ai

: oh

‘ Lerm Ol i y Ss ie a ucd ul ler LIUS¢

n (a) of this section may, within 60 days after

ompletion of the required action, petition th

resident for reimbursement from the Fund f

e reasonable costs of such action, plus interest

Any interest payable under this paragraph shal

crue on the amounts expended from the date «

<penditure at the same rate aS specified lo!

terest on investments of the Hazardous Sub

’ . 1} ‘ } 4

ince Superfund established under subchap

hapter 98 of Title 26

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wa ~ r

ears on

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treatment tacilities, incineration vessels or

selected by such person, from which there

release, or a threatened release which causes the

incurrence of response costs, of a hazar

substance, shall be hable for

A) all costs of removal or remedial ac

incurred by the United States Government or a

State or an Indian tribe not inconsistent

the national contingency plan;

?\ , > > oC a > . ~ " : ~~

B) any other necessary costs of res]

incurred by any other person consistent

the national contingency plan;

C) damages for injury to, destruction «

loss of natural resources, including the re:

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able costs of assessing such injury, destruc

or loss resulting from such a release; and

}

113

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with

ison

tran

(D) the costs of any health assessment

health effects study carried out under s

9604(1) of this title

ine amounts recoverabie in an action unaer

section shall include tnterest on the amounts

verable under subparagraphs (A) through (D)

interest shall accrue from the later of (i) the

payment of a specified amount is demande

}

writing, or (ii) the date of the expenditure concerned

The rate of interest on the outstanding unpaid

ance of the amounts recoverable under this section

shall be the same rate as is specified for interest on

investments of the Hazardous Substance Super

established under subchapter A of chapter 98 of

fund

Tith

26. For purposes of applying such amendments

nterest under this subsection, the term “compara

- : " ’

»tiri,r chall hg : Orr

late

LS8a

date on which interest accruing under this subsection

commences

(b) Defenses

There shall be no liability under subsection (a) of

this section for a person otherwise liable who can

establish by a preponderance of the evidence that the

release or threat of release of a hazardous substance

and the damages resulting therefrom were caused

solely by-

‘1) an act of God:

(2) an act of war:

(3) an act or omission of a third party other than

an employee or agent of the defendant, or than

one whose act or omission occurs in connection

with a contractual relationship, existing directly

or indirectly, with the defendant (except where

the sole contractual arrangement arises from a

published tanff and acceptance for carriage by a

common carrier by rail), if the defendant estab-

lishes by a preponderance of the evidence that (a)

he exercised due care with respect to the hazard-

ous substance concerned, taking into considera

tion the characteristics of such hazardous

substance, in light of all relevant facts and cir-

cumstances, and (b) he took precautions against

foreseeable acts or omissions of any such third

party and the consequences that could foresee-

ably result from such acts or omissions; or |

(4) any combination of the foregoing paragraphs

Determination of amounts

(1) Except as provided in paragraph (2) of this

subsection, the liability under this section of an

owner or operator or other responsible person for

L89Ya

each release of a hazardous substance or incident

involving release of a hazardous substance shall

not exceed

(A) for any vessel, other than an incineration

vessel, which carries any hazardous substance

as cargo or residue, $300 per gross ton, or

$5,000,000, whichever is greater;

(B) for any other vessel, other than an incine

ration vessel, $300 per gross ton, or $500,000,

whichever is greater;

liquid pipeline facility (as defined in section

6010l(a) of Title 49), or _ rolling = stock,

$50,000,000 or such lesser amount as the

President shall establish by regulation, but in

no event less than $5,000,000 (or, for releases

of hazardous substances as defined in section

9601(14)(A) of this title into the navigable

waters, $8,000,000). Such regulations shall

take into account the size, type, location,

storage, and handling capacity and other

matters relating to the likelihood of release in

each such class and to the economic impact of

such limits on each such class; or

(D) for any incineration vessel or any facility

other than those specified in subparagraph (C

of this paragraph, the total of all costs of

response plus $50,000,000 for any damage:

under this subchapter.

2) Notwithstanding the limitations in paragraph

(1) of this subsection, the liability of an owner or

operator or other responsible person under this

section shall be the full and total costs of

response and damages, if (A)(i) the release

190a

threat of release of a hazardous substance was

the result of willful misconduct or willful

negligence within the privity or knowledge of

such person, or (ii) the primary cause of the

release was a violation (within the privity or

knowledge of such person) of applicable safety,

construction, or operating standards or regula-

tions; or (B) such person fails or refuses to

provide all reasonable cooperation and assistance

requested by a responsible public official in

connection with response activities under the

national contingency plan with respect to

regulated carriers subject to the provisions of

Title 49 or vessels subject to the provisions of

Title 33, 46, or 46 Appendix, subparagraph (A)(ii)

of this paragraph shall be deemed to refer to

Federal standards or regulations.

(3) If any person who is liable for a release or

threat of release of a hazardous substance fails

without sufficient cause to properly provide

removal or remedial action upon order of the

President pursuant to section 9604 or 9606 of

this title, such person may be liable to the United

States for punitive damages in an amount at

least equal to, and not more than three times,

the amount of any costs incurred by the Fund as

a result of such failure to take proper action. The

President is authorized to commence a civil

action against any such person to recover the

punitive damages, which shall be in addition to

any costs recovered from such person pursuant to

section 9612(c) of this title. Any moneys received

by the United States pursuant to this subsection

shall be deposited in the Fund.

litle 42. The Public Health and Welf

hapter 103. Comprehensive Environm:

Response, Compensation, and Liabilit

ibchapter I. Hazardous Substances Rel

lability (‘om

edit

Except as provided in paragrap

o action may be commenced for da

lefined in section 9601(6) of this titl i

hapter, unless that action comme

} years after the later of the followii

.) Lhe aate or t

PL ELE IO!

iv ( te (

oe = (

Wit p

National Pnioritie NPI

acility identified unde) ect

relating to Federal faciliti

cility it which a remedia

hapter is otherwise schedul

lamages under t! chapter mu

ithin j Veal iter the compte

medial iction excludin: operat

mance actilvitie 1]

pect ) a vessel or fa

1) prior to

natural resource’ trustee

60 days after the Federal or

Lilt (

\ COT

Ww 3 iT

}

LO Ln

provides

President and the potentially responsible party a

notice of intent to file suit, or (11) before selectio:

of the remedial action if

diligently proceeding with

the President 1

remedial invest!

sation and feasibility study under section 9604(b

of this title or section 9620 of this title (relating

to Federal facilities) The limitation in the

preceding sentence on commencing an action

before giving notice or before selection of the

remedial action does not apply to actions filed

r before October 17. 1986

Actions fo! recove!l y] )

An initial action for recove

eferred to in secti 9607 of tl]

ymmenced

1) for a removal action Lnin i! al

ompletion of the removal action, except tha

uch cost action must be brought

recovery

within 6 years after a determination to grant

vaiver under section 9604(c)(1)(C)

I continued response action:

B) for a remedial action,

initiation of physical on

1te

ff ‘|

thi

5 Ff |

YW\CAI I

within 6

construction of the

remedial action, except that, if the remedia

iction is initiated within 3 years after tl

ompletion of the removal action ost

ncurred in the removal iction |

ecovered in the cost reco'

nder this subparagraph

\ ich action descril is

lability for response costs or damages that wi

be binding on any subsequent action or action

to recover further response costs or damages. A

subsequent action or actions under sectio1

9607 of this title for further response costs at

the vessel or facility may be maintained at any

time during the response action, but must be

commenced no later than 3 years after the date

of completion of all response action. Except a

otherwise provided in this paragraph, an

action may be commenced under section 9607

of this title for recovery of costs at any tin

}

after such costs have been incurret

3) Contribution

No action for contribution for any respon

costs or damages may be commenced more tha

{ vears after

(A) the date of judgment in any action und

this chapter for recovery of uch cost

damages, o1

B) the date of an administrative order un

ection 9622(¢) of this title (relating to de

minimis settlements) or 9622(h) of this titl

(relating to cost recovery settlements) or entry

of a judicially approved settlement wit!

i espect to such costs or damat

) Subrogation

No action based on rights subrogated pursu:

to this section by reason of payment of a clain

may be commenced under this subchapter mor

than 3 years after the date of payment of

3 4

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.