Opposition Brief — Utah v. Salt Lake County Water Conservancy District

Supreme Court brief1994

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) [ Bovrema Court, U °.

No. 94-147 ~~ ; eet

SEP 2 1994

In The

EF OF THE CLERK

Supreme Court of the

~>-

October Term, 1994

THE STATE OF UTAH, BY AND THROUGH THE UTAH

STATE DEPARTMENT OF HEALTH, and KENNECOTT

CORPORATION,

Petitioners,

vs.

SALT LAKE COUNTY WATER CONSERVANCY DISTRICT,

Respondent.

On Petition for a Writ of Certiorari to the United States Court |

of Appeals for the Tenth Circuit

RESPONDENT?’S BRIEF IN OPPOSITION

DOUGLAS J. PARRY DALE F. GARDINER

Counsel of Record Salt Lake County Water

KEVIN R. MURRAY Conservancy District

JAMES K. TRACY 8215 South 1300 West

PARRY MURRAY WARD P.O. Box 70

& MOXLEY West Jordan, Utah 84084-0070

1270 Eagle Gate Tower (801) 565-8903

60 East South Temple

Salt Lake City, Utah 84118

(801) 521-3434

Attorneys for Respondent

Nargis (800) 3 APPEAL « (800) 5 APPEAL + (800) BRIEF 21

ervices, inc.

QUESTIONS PRESENTED

1. Does this Court’s recent opinion in Digital Equipment

Corp. v. Desktop Direct, Inc., 1148S. Ct. 1992 (1994), holding that

“an order denying effect to a settlement agreement does not come

within the narrow ambit of collateral orders,” govern the

appealability of a district court’s denial of entry of aconsent decree

proposed by a government trustee.

2. Whether a trustee authorized to assess natural resources

damages and seek recovery for such damages on behalf of the

public has an “explicit statutory guarantee of immunity from trial”

so that the refusal by a district court to enter a consent decree

proposed by that trustee presents grounds for an immediate appeal

under the collateral order doctrine.

- ii

TABLE OF CONTENTS

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Statutory Provisions Involved ................ee000-

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A. Preece OOO 5ccccccescccsivccuses

B. The District Court’s Review and Denial of Entry of

the Proposed Consent Decree. ................

C. The Tenth Circuit Found that the Order is Not

Immediately Appealable Pursuant to § 1291. ....

Summary Of Argument ......cccccccccceces iareenes

A. Digital Equipment Corp. v. Desktop Direct, Inc.,

114 S. Ct. 1992 (1994), Is Controlling of This

Petition. Consistent with That Opinion, This Court

Should Deny Petitioners’ Request for a Writ of

CONROE. .. oc cuscecesenceeebeneweeueneees

B. The Petition Fails to Qualify Under the Collateral

Order Exception to the Finality Rule as Enunciated

in Cohen v. Beneficial Industrial Loan Corp., 337

U.S. 541 (1941), andIts Progeny. .............

Contents

Page

1. Certiorari Should Be Denied Because The

Petition Fails To Identify An “Important”

Explicit Statutory Or Constitutional Right

That Would Supply The Basis For A Collateral

OrderAppeal. ........---ceeeceeeceeees 7

2. The District Court’s Order Did Not Resolve an

Important Issue Completely Separate from the

Merits of theAction. ...........eeeeeees 9

3. Denial of Entry of a Consent Decree Does Not

Conclusively Determine the Parties’ Ability

to Settle Their Claims. ...............+.-- 9

4. A Right to Settle and Not to Proceed with

Litigation Is Not an Important Right

Effectively Unreviewable on Appeal after

Judgment. ........ccccccccccsccccccves 9

C. The Petition does Not Present an Issue in Conflict

Among the Courts of Appeals. The Courts Are in

Agreement that a District Court’s Refusal to

Approve a Proposed Settlement Agreement Is Not

Appealable Under 28 U.S.C. § 1291. ..........- 10

D. Petitioners Have Improperly Raised an Issue in the

Petition for Certiorari that Was Not Presented

ES See eer eT ee ee Te TY oe eee 11

Misstatements of Fact or Law Set Forth in the Petition ... 11

Contents

Reasons for Denying the Writ ..........cccccccccess

Il.

Digital Equipment Corp. v. Desktop Direct, Inc.,

114 S. Ct. 1992 (1994), is controlling of this

Petition. Consistent with that opinion, this Court

should deny Petitioners’ request for a Writ of

Yee eee ee eer ree Tey ey

The Petition fails to qualify under the collateral

order exception to the finality rule as enunciated in

Cohen v. Beneficial Industrial Loan Corp., 337

U.S. 541 (1941), andits progeny. .............

Certiorari Should Be Denied Because the

Petition Fails to Identify an “Important”

Explicit Statutory or Constitutional Right that

Would Supply the Basis of a Collateral Order

pr errr eee

The District Court’s Order Did Not Resolve an

Important Issue Completely Separate from the

Meritsof the Action. ......ccccccccccecs

Denial of Entry of a Consent Decree Does Not

Conclusively Determine the Parties’ Ability

gt rere rere reer

A Right to Settle and Not to Proceed with

Litigation Is Not an Important Right

Effectively Unreviewable on Appeal after

PE Scdnckpeadeduswanteaueaees ea

Page

Contents

Page

III. The Petition does not present an issue in conflict

among the courts of appeals. The courts are in

agreement that a district court’s refusal to approve

a proposed settlement agreement is not appealable

CRE Ae ase ORs 6k 6 5 sah cde nncsacedcas 25

IV. Petitioners have improperly raised an issue in the

Petition for Certiorari that was not presented

WO: a. v's ciektin ered Rhinscienesiennee’ 28

COONIODD ob cc ccnecetnedkessceadgies cececeavens 30

TABLE OF CITATIONS

Cases Cited:

Abney v. United States, 431 U.S.651(1977) ........... 15

Air Courier Conference of American v. American Postal

Workers Union, 498 U.S.517(1991) ............. 28, 29, 30

Carlson v. Green, 446 U.S. 14(1980) ............005. 11,28

Carson v. American Brands, Inc., 606 F.2d 420 (4th Cir

1979), rev’d on other grounds, 450 U.S. 79 (1981) .... 26

Catlin v. United, States, 324 U.S.229(1945) .......... 16

Chaput v. Unisys Corp., 964 F.2d 1299 (2d Cir. 1992) .... 28

Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541

SGEE s sesavicecdevevenass 5, 7,9, 11, 16, 18, 23, 24, 25, 26

Contents

Page

Coopers & Lybrand v. Livesay, 437 U.S.468 .......... 9,17,23

DeShaney v. Winnebago County Dept. of Social

Services, 489 U.S. 189 (1989) ....... ccc cccccceces 29

Desktop Direct, Inc. v. Digital Equipment Corp., 993 F.2d

TEPER GE RUOEE bos Sedaivauduscedesctevedees 1, 13,27

Digital Equipment Corp. v. Desktop Direct, Inc., 1148S. Ct.

SOO CHOSE ck ckcetteéuevcevess vasaweseeseeeres passim

Donovan v. Robbins, 752 F.2d 1170 (7th Cir. 1985) ...... 26

E.E.O.C. v. Pan American World Airways, Inc., 796 F.2d

314 (9th Cir. 1986), cert. denied, 479 U.S. 1030 (1987)

TTTTITT TTT ree ere re re ee 26

FirsTier Mortgage Co. v. Investors Mortgage Ins. Co., 498

tee ot PP er eee ee 16

Forbus v. Sears Roebuck & Co., 958 F.2d 1036 (11th Cir.),

cert. denied, 113 S.Ct.412(1992) ................ 27

Grillet v. Sears, Roebuck & Co., 927 F.2d 217 (Sth Cir.

OPE) ocvcavsvccececevcessesetesss1seeuunee 27

Gulfstream Aerospace Corp. v. Mayacamas Corp., 485

oh Git. Peerrrerrrry rr tr er 16, 17,24

In re Achushnet River & New Bedford Harbor, 712 F. Supp.

oo. 3. | errr ee ee 21

vil

Contents

Page

Janneh v. GAF Corp., 887 F.2d 432 (2d Cir. 1989), cert.

Gea, GIS a SOO RPOED c ce cecccsccscccceuces 27,28

Lauro Lines S.R.L. v. Chaser, 490 U.S. 495 (1989) ...... 15

Midland Asphalt Corp. v. United States, 489 U.S. 794

SE 06s SUUSGA bbe RaW eE Reb dkwOS 08445500000 23

Mitchell v. Forsyth, 472 U.S.511(1985) .............. 14

Moses H. Cone Memorial Hospital v. Mercury

Construction Corp., 260 U.S. 1(1983) ............. 24

New York v. Dairlea Cooperative, Inc., 698 F.2d 567 (2d

Gt ED Side ddeeAekd dubedseneselwesseetucees 26

New York v. Exxon Corp., 697 F. Supp. 677 (S.D.N.Y.

PE, dice Cake ead ee ad eaaedakkhe ne eeeues 21

Nixon v. Fitzgerald, 457 U.S. 731 (1982) .............4. 15

Norman v. McKee, 431 F.2d 769 (9th Cir. 1970) ........ 26

Puerto Rico Aqueduct & Sewer Authority v. Metcalf &

Eddy, Inc., 113 S. Ct. 684(1993) 2... cc ccccccccees 14

Rouch v. Churchman, 457 F.2d 1101 (8th Cir. 1972) ..... 26

Seigal v. Merrick, 590 F.2d 35 (2d Cir. 1978) ......... 26, 27,28

Transtech Industries, Inc. v. A&Z Septic Clean, 5 F.3d 51

SED. 5. s:04k0 ced dedes cechantadanndaewe 27

vill

Contents

Page

United States v. Cannons Engineering Corp., 899 F.2d 79

re rr re re 12,20

United States v. Montrose Chemical Corp., 827 F. Supp.

og es | PE eTeT TTT Tree Tree Tere e 21

Utah v. Kennecott, Case No. C86-902 (D. Utah) ........ 4

Utah v. Kennecott, 14 F.3d 1489 (10th Cir. 1994) ...3,5,9, 24, 26

Utah v. Kennecott, 801 F. Supp. 553 (D. Utah 1992) ..... 3,4

Statutes Cited:

The Comprehensive Environmental Response Compensation

and Liability Act of 1988 (“CERCLA”), 42 U.S.C.

§ 9607(f), et seg., CERCLA § 107(f), etseg. ........ passim

yo ee Terror rr TTT Ter rrrre Tr rer Tee

....1,2,5, 6,7, 10, 11, 12, 13, 14, 15, 16, 17, 18, 25, 26, 27, 29

See MED bo Seek ees ce ecdwsccdecndeeees 5

Ss) CE 600.06 ak Weeessendsveesaveees 26

BPG SUMED Fc ck dsasedevcrsseeevesseveas sa 1,18

United States Constitution Cited:

i awe wnte een wweess 15

I. oc cweee twas boewwkeewes 14

iii i

Contents

Page

Rules Cited:

Fed. Rule of Civil Procedure 24(b) ..............005. 4

Other Authority Cited:

H.R. Rep. No. 253, Pt. 3, 99th Cong., Ist Sess. 19 (1985),

reprinted in 1986 U.S. Code Cong. & Admin. News

Pe eer eT Ce TELE TTT TET Tee 20, 22

APPENDIX

Appendix A— CERCLA § 107(f), 42 U.S.C. § 9607(f) .. la

Appendix B — Utah v. Kennecott, Case No. C86-902,

Portions of Transcript of October 25, 1991 Hearing (D.

WE Gace cccbdvatieneeekbuds skeenbieeeres«nas 4a

Appendix C — Portions of Docketing Statements Filed

with the Tenth Circuit by Petitioners ............... 10a

Appendix D — Portions of Joint Memorandum Brief of the

State of Utah and Kennecott Corporation Regarding

Appellate Jurisdiction ............:.seeeeeeeeees 22a

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]

INTRODUCTION

The Petition for Certiorari seeks review of a Tenth Circuit

Court of Appeals’ order denying § 1291 review of a district court’s

denial of the entry of a proposed consent decree between the State

of Utah, acting as trustee on behalf of the public (“Utah”) and

Kennecott Corporation (“Kennecott”) on the grounds that the

proposed settlement was not fair and consistent with the purposes

that CERCLA is intended to serve.

Neither Utah nor Kennecott moved for the district court’s

certification under 28 U.S.C. § 1292(b).

In denying jurisdiction, the Tenth Circuit Court of Appeals

relied on its earlier opinion in Desktop Direct, Inc. v. Digital

Equipment Corp., 993 F.2d 775 (10th Cir. 1993) (“Desktop”),

which opinion was recently affirmed by this Court in Digital

Equipment Corp. v. Desktop Direct, Inc., 114 S. Ct. 1992 (1994)

(“Digital Equipment’). In Digital Equipment, this Court held that

“an order denying effect to a settlement agreement does not come

within the narrow ambit of collateral orders.” 114 S. Ct. at 1994.

Contrary to the argument of Utah and Kennecott, the Petition

does not involve the denial of a right “explicitly guaranteed by a

particular constitutional or statutory provision.” Rather,

Petitioners seek to circumvent the finality requirements of § 1291

by erroneously arguing that because CERCLA encourages

settlement of claims, it necessarily follows that a trustee appointed

pursuant to CERCLA has an “explicit statutory right” to settle on

its own negotiated terms and avoid trial. There is no such right.

This Petition does not present a special or important issue, nor

is it in conflict with Digital Equipment or with decisions of other

United States Courts of Appeals. Digital Equipment is controlling.

The Petition for a Writ of Certiorari should be denied.

STATUTORY PROVISIONS INVOLVED

A. 28U.S.C. § 129] (set forth in Petition for a Writ of Certiorari

at 3).

B. The Comprehensive Environmental Response, Compensation

and Liability Act of 1988 (“CERCLA”), 42 U.S.C. § 9607(f),

CERCLA § 107(f) (set forth in full in Appendix A).

STATEMENT OF THE CASE

A. Procedural Background

Both Petitioner, State of Utah, as the State CERCLA Trustee

designated to act on behalf of the public as trustee of the damaged

natural resources, and Petitioner, Kennecott Corporation, sought

review by the court below of an order of the federal district court

denying a motion to approve and enter a consent decree submitted

by the parties. The proposal would have settled the public’s claim

against Kennecott for natural resource damages under CERCLA

§ 107(f),42 U.S.C. § 9607(f).

Utah and Kennecott each filed separate appeals, which were

subsequently consolidated, arguing that refusal to enter the

proposed consent decree was appealable as a final collateral order

under 28 U.S.C. § 1291 because the district court’s order (1)

conclusively determined Utah’s and Kennecott’s right not to go to

trial, (2) resolved the “important” issue of whether the district

court applied an erroneous legal standard in considering entry of

the proposed consent decree, and (3) because the order was

effectively unreviewable on appeal from a final judgment.

Respondent, Salt Lake County Water Conservancy District

(“District”), a political subdivision of the State of Utah and a

permissive intervenor in the proceeding below, moved to dismiss

the consolidated appeals for lack of jurisdiction. The motion was

granted by the Tenth Circuit, and the Petition for Certiorari

followed.

B. The District Court’s Review and Denial of Entry of the

Proposed Consent Decree.

In 1986, Utah, as Trustee, filed CERCLA natural resource

damage claims against Kennecott for contamination of ground and

surface water in Salt Lake County resulting from Kennecott’s and

their predecessor corporations’ operation of the Bingham Copper

Mine in the Salt Lake Valley. The Complaint claimed damages in

the approximate amount of $129 million based on the quantity of

groundwater believed to be contaminated. See Utah v. Kennecott,

801 F. Supp. 553 (D. Utah 1992); Petition for a Writ of Certiorari

(“Petition”), at 3B.' Kennecott initially offered to settle the claims

for assignment of water rights and performance of remediation

work valued in excess of $100 million. Jd. at 4B. Utah rejected this

offer on the ground that Utah could not conclude that the settlement

would satisfy all public concerns. Jd. at 3A, 11B.

Following the subsequent negotiations, on July 30, 1991,

Utah and Kennecott filed a consent decree with the district court

proposing to settle the natural resource damage claim for $11.7

million, plus three hundred thousand dollars for attorney’s fees in

exchange for a release and covenant not to sue Kennecott for

CERCLA response costs or for damages to surface and

groundwater in a defined “mining impact area.” Jd. at 14B.

1. The opinions below are included in the Appendix to the Petition for a

Writ of Certiorari. The opinion of the Tenth Circuit, Utah v. Kennecott, 14 F.3d

1489 (10th Cir. 1994), is included as Appendix A and the Memorandum Decision

and Order of the District Court, Utah v. Kennecott, 80: F. Supp. 553 (D. Utah

1992), is included as Appendix B. For the convenience of the Court, this brief

contains cites to the pages of the Petition’s Appendix when referring to these

cases.

The District moved to intervene as a matter of right pursuant

to CERCLA § 133(i), 42 U.S.C. § 9633, and opposed entry of the

proposed settlement on the ground that it was not consistent with

the requirements of CERCLA. After a period of public comment,

the district court held a hearing on Petitioners’ Motion for Entry of

the proposed decree. At the hearing, Petitioners failed to give the

court any basis for the settlement and argued that absent evidence

of collusion or bad faith the court was required to accept the

proposed consent decree. Utah v. Kennecott, Case No. C86-902

(D. Utah), Portions of Transcript of October 25, 1991 Hearing

(attached hereto as Appendix B) at 4a-8a.

Recognizing its duty to determine whether the proposed

consent decree was fair, just and consistent with the statutory

mandate, the trial court declined to approve the settlement and

ordered an evidentiary hearing to determine the sufficiency of the

proposed settlement. The court also granted the District permissive

intervention for the purpose of participating in discovery and the

evidentiary hearing. Petition at 14B-17B; Transcript of Hearing at

1033.

After six days of hearing, the district court entered its

Memorandum Decision and Order (“Order”), concluding that “the

proposed Consent Decree as written is not just and fair or

consistent with the purposes of CERCLA.” Utah v. Kennecott

Corp., 801 F. Supp. 553, 572 (D. Utah 1992); Petition at 45B.

Accordingly, the court denied approval of the proposed consent

decree, and granted the District permissive intervention pursuant

to Rule 24(b) of the Federal Rules of Civil Procedure. Jd. Instead

of attending a scheduled case management conference, both Utah

and Kennecott appealed.

renee ete rearee

C. The Tenth Circuit Found that the Order is Not

Immediately Appealable Pursuant to § 1291.

Petitioners contended that jurisdiction in the Tenth Circuit

was proper (1) under the collateral order exception to § 1291, (2)

pursuant to the pragmatic finality doctrine of the Tenth Circuit, and

(3) because the Order had the practical effect of granting or

denying injunctive relief appealable pursuant to § 1291(a)(1). The

Tenth Circuit held that the trial court’s denial of the proposed

consent decree did not satisfy any of the alleged grounds for

appellate review and granted the District’s motion to dismiss for

lack of jurisdiction.? Utah v. Kennecott, 14 F.3d at 1495-97;

Petition at 14A-18A.

In examining the right of immediate appellate review in light

of the Cohen test, the Tenth Circuit found (1) that the district

court’s order is not final and does no more than permit Petitioners

to propose a new consent decree within the bounds of substantive

fairness, to seek reconsideration of the proposed decree, or to

litigate the issues on the merits and (2) that Utah and Kennecott

could not point to a right of review under CERCLA or any other

statutory or constitutional ground that would require immediate

appellate review of a denied consent decree. Utah v. Kennecott, 14

F.3d at 1493-94, Petition at 9A-10A, 12A.

In their Petition for a Writ of Certiorari, Utah and Kennecott

now urge that an unidentified CERCLA provision “which

explicitly favors minimizing litigation” creates the necessary

“explicit statutory right” to satisfy the “important question” prong

of the Cohen test. Petitioners argue that this amorphic provision

creates a statutory right of a government trustee to settle a natural

2. In their Petition for a Writ of Certiorari, Petitioners only seek to review

the circuit court’s denial of jurisdiction pursuant to the collateral order exception

to § 1291.

resource damage claim on its own terms to avoid trial.’

SUMMARY OF ARGUMENT

A. Digital Equipment Corp. v. Desktop Direct, Inc., 114 S. Ct.

1992 (1994), Is Controlling of This Petition. Consistent with

That Opinion, This Court Should Deny Petitioners’ Request

for a Writ of Certiorari.

This court recently held in Digital Equipment Corp. v.

Desktop Direct, Inc., 114 S. Ct. 1992 (1994) (“Digital

Equipment”), “that an order denying effect to a settlement

agreement does not come within the narrow ambit of collateral

orders” immediately appealable pursuant to § 1291 of the Judicial

Code. Id. at 1994. This is precisely the issue presented by the

present Petition for Certiorari.

The Petition seeks review of the district court’s refusal to

approve a settlement agreement between Utah and Kennecott and

enter a proposed consent decree after the court found that there was

not a sufficient factual foundation from which it could find that the

proposed decree was fair and consistent with the purposes that

CERCLA is intended to serve.

Petitioners state that “{i]f denial of this settlement is not

reviewed immediately, then the CERCLA Trustee’s right to bring

and settle this claim will be infringed with no opportunity to

redress.” Petition at 22. This argument is nothing more than

another version of the “right not to be tried” argument that was

expressly rejected by this Court in Digital Equipment. As this

3. Petitioners do not cite to a statutory provision that grants a government

trustee the right to obtain a consent decree settling a natural resource damage

claim on its own terms. In fact, Petitioners have not included in the “Pertinent

Statutory Provision” section of their Petition any CERCLA statutory authority.

Petitioners only reference 28 U.S.C. § 1291.

Court has made clear, the right to be trial-free obtained through a

settlement agreement, as contrasted with a right grounded on an

explicit, statutory or constitutional guarantee of immunity, simply

“does not rise to the level of importance needed for recognition

under § 1291.” Jd. at 2001.

B. The Petition Fails to Qualify Under the Collateral Order

Exception to the Finality Rule as Enunciated in Cohen vy.

Beneficial Industrial Loan Corp., 337 U.S. 541 (1941), and Its

Progeny.

1. Certiorari Should Be Denied Because The Petition Fails

To Identify An “Important” Explicit Statutory Or Constitutional

Right That Would Supply The Basis For A Collateral Order

Appeal.

In Digital Equipment, this Court suggested that nonfinal

orders may be immediately appealable where important “statutory

and constitutional rights” are irretrievably lost. Jd. at 2002.

However, this Court also explained that the right to be trial-free

obtained through a settlement agreement does not rise to the level

of importance needed to supply a basis for interlocutory appeal

under § 1291. Jd. at 2001.

In an effort to circumvent the express holding of Digital

Equipment, Petitioners argue that because one of the parties to the

proposed consent decree was a trustee appointed pursuant to

CERCLA with authority to seek damages for injury to natural

resources, the trustee has “explicit statutory authority” to settle

which falls within the narrow exception to the finality rule of

§ 1291.

CERCLA, like many other federal statutes, provides for a

trustee and places in that trustee the responsibility to pursue claims

for damages. See CERCLA § 107(f), 42 U.S.C. § 9607(f).

CERCLA, however, does not provide and Petitioners have not

pointed to an “explicit statutory right or guarantee” which was

denied by the trial court’s refusal to enter the proposed decree.

CERCLA’s grant of authority to a natural resource trustee is

contained in § 107(f), which provides only that a natural resource

trustee may assess damages to natural resources and “shall act on

behalf of the public as trustee of such natural resources to recover

for such damages.” CERCLA § 107(f)(1), 42 U.S.C. § 9607(f)(1).

Other than this provision, CERCLA grants no authority to a natural

resource trustee to bring, try or settle claims for natural resource

damages.

Authority conferred by CERCLA on a trustee to “recover for

such damages” may, by implication, give that trustee authority to

file lawsuits, manage litigation and even enter into settlement

agreements. However, this implied authority does not create an

“explicit statutory right” to settle those claims on the trustee’s

proposed terms. In fact, the legislative history of CERCLA clearly

indicates that Congress expressly intended that CERCLA

settlements be subject to challenge and reviewable by federal

district courts to insure that settlements would be fair and just to the

public and consistent with the purposes of CERCLA.

The right to immunity from trial that Petitioners argue is

present in this case must be “explicit” in the statute, not just

implicit from a general policy of CERCLA to encourage settlement

or the general public policy favoring settlement that is implicit in

all litigation, including CERCLA claims. See Digital Equipment,

114 S. Ct. at 2002 (This Court was not swayed by what it

characterized as Digital’s “last-ditch effort” to come within

Cohen’s sense of importance by trying to show that settlements

merit collateral order treatment “because they advance the public

policy favoring voluntary resolution of disputes.”).

2. The District Court's Order Did Not Resolve an Important

Issue Completely Separate from the Merits of the Action.

To meet the second prong of Cohen, the “important question”

must also be “completely separate from the merits of the action.”

Coopers & Lybrand v. Livesay, 437 U.S. 463, 468 (1978). The issue

raised by Petitioners of whether a trustee has a right to settle a

natural resource damages claim is inextricably enmeshed with the

merits of the litigation — whether the trustee’s proposed consent

decree is just, fair and consistent with CERCLA.

3. Denial of Entry of a Consent Decree Does Not

Conclusively Determine the Parties’ Ability to Settle Their Claims.

To satisfy the first prong of the Cohen test the district court’s

denial of the consent decree must conclusively determine the

parties’ abilities to settle their claims. Orders that are inherently

tentative “to which some revision might reasonably be expected in

the ordinary course of litigation” do not meet this requirement.

The district court’s order denying effect to a proposed consent

decree is inherently tentative. The district court determined only

that approval of the consent decree required further study and

factual support. The Order did not contain any limitations on the

court’s ability to reconsider future proposals. It does no more than

permit Petitioners to propose a new consent decree within the

bounds of substantive fairness. Utah v. Kennecott Corp., 14 F.3d at

1494; Petition at 9A-10A.

4. A Right to Settle and Not to Proceed with Litigation Is Not

an Important Right Effectively Unreviewable on Appeal after

Judgment.

Any rights of Utah and Kennecott under their settlement

agreement can be adequately vindicated on appeal from a final

judgment. See Digital Equipment, 114 S. Ct. at 1996 (“rights under

private settlement agreements can be adequately vindicated on

appeal from final judgment.”).

C. The Petition Does Not Present an Issue in Conflict Among

the Courts of Appeals. The Courts Are in Agreement that a

District Court’s Refusal to Approve a Proposed Settlement

Agreement Is Not Appealable Under 28 U.S.C. § 1291.

This Petition involves the immediate appealability of a district

court’s refusal to enter a proposed settlement agreement.

Petitioners cite to no authority conflicting with the Tenth Circuit’s

opinion denying § 1291 appealability to the denial of entry of a

proposed settlement agreement. Courts of Appeals have

consistently denied appellate jurisdiction to review the denial of

entry of a proposed settlement agreement because review requires

inquiry into the merits of the case.

In suggesting a conflict among the circuit courts, Petitioners

cite to cases involving refusal to enforce pre-existing settlement

agreements. Review of an order denying enforceability of a pre-

existing settlement does not require an inquiry into the merits of

the case. As noted by Petitioners, prior to Digital Equipment courts

of appeals sometimes did find § 1291 jurisdiction to review a

district court’s refusal to enforce a pre-existing settlement

agreement. However, whatever jurisdictional distinction may have

existed between these two lines of cases was resolved by the

Supreme Court in Digital Equipment which “granted certiorari to

resolve this conflict.” Digital Equipment at 1995.

In Digital Equipment, the Supreme Court held that even in the

second line of cases, appellate jurisdiction was not available under

§ 1291. “We hold that an order denying effect to a settlement

agreement does not come within the narrow ambit of collateral

orders.” Jd. at 1994.

D. Petitioners Have Improperly Raised an Issue in the

Petition for Certiorari that Was Not Presented Below.

This Court has made clear that, although not precluded from

doing so, the Court will “not normally decide issues not presented

below.” Carlson v. Green, 446 U.S. 14, 17 (1980). In their Petition

for a Writ of Certiorari, Utah and Kennecott ask this Court to

consider whether a CERCLA Tmustee has a statutory right to settle

claims on its own terms and whether this right, if it exists, is

“important” as that term is used in the Cohen test for determining

interlocutory appealability. Petitioner’s Brief at 9. This is an issue

that the Petitioners did not raise before the Tenth Circuit.

In its brief regarding appellate jurisdiction filed in the court

below, Petitioners argued that the central issue in the appeal which

allegedly satisfied the “important” requirement of Cohen was “the

correct standard of review to be applied to a proposed settlement of

a natural resource damages claim by a federal district court.” This

Court found such a claim “patently irrelevant for § 1291 purposes.”

Digital Equipment, 114 S.Ct. at 2000 n. 6.

Petitioners did not argue to the Tenth Circuit that a natural

resource trustee has a “statutory” right to settle natural resource

claims on its own terms and that the denial of such a right, if it

exists, is “important” under Cohen. Consequently, this Court

should refuse to now consider this issue on the Writ of Certiorari.

MISSTATEMENTS OF FACT OR LAW SET FORTH IN

THE PETITION

1. Petitioners erroneously state that CERCLA provides

natural resource trustees with explicit statutory authority to settle

claims. See Petition at 8(CERCLA trustee has a right “to bring and

settle a claim for natural resource damages.”); Jd. at 10 (natural

resource trustee has “exclusive and plenary power to bring, assess,

try and settle claims.”); /d. (referring to “Trustee’s statutory right

to settle a natural resource damage claim under CERCLA. . . .”) Id.

at 18 (claiming that the district court interfered with “the CERCLA

Trustee’s statutory authority to settle this claim.”); /d. at 21

(referring to “CERCLA Trustee’s right to bring and settle a claim

for natural resource damages. . . .”).

In reality, the only statutory authority granted a natural

resource trustee under CERCLA is authority “to assess damages”

and “to recover for such damages.” CERCLA § 107(f)(1), (2)(B),

42 U.S.C. § 9607(f)(1), (2)(B). Nowhere does CERCLA grant a

trustee “exclusive and plenary” authority to “settle” claims for

natural resource damages. Petitioners have not and cannot cite to

any such statutory authority.

In fact, to settle a natural resource damages claim, a natural

resource trustee is required to obtain a consent decree from a

district court that has the duty to determine whether the consent

decree is “reasonable, fair, and consistent with the purposes that

CERCLA is intended to serve.” United States v. Cannons

Engineering Corp., 899 F.2d 79, 85 (1st Cir. 1990).

2. Petitioners misstate the holding of this Court in Digital

Equipment by suggesting that the holding in that case applied only

to private settlement agreements. While it is true that the

settlement agreement at issue in Digital Equipment was a “private”

settlement agreement, the explicit language of this Court’s

holdings in that case clearly applied to settlement agreements in

general, including consent decrees, and was not restricted to

private settlement agreements. See, e.g., Digital Equipment, 1145S.

Ct. at 1194 (“We hold that an order denying effect a settlement

agreement does not come within the narrow ambit of collateral

orders”) (emphasis added); Id. at 2004 (“We accordingly hold that

a refusal to enforce a settlement agreement claimed to shelter a

party from suit altogether does not supply the basis for immediate

appeal under § 1291.”) (emphasis added).

REASONS FOR DENYING THE WRIT

DIGITAL EQUIPMENT CORP. V. DESKTOP DIRECT,

INC., 114 S. Ct. 1992 (1994), IS CONTROLLING OF THIS

PETITION. CONSISTENT WITH THAT OPINION, THIS

COURT SHOULD DENY PETITIONERS’ REQUEST FOR

A WRIT OF CERTIORARI.

This Court was recently faced with the same issue that is

before the Court in the present Petition for a Writ of Certiorari:

Whether a district court’s refusal to give effect to a settlement

agreement between two parties is immediately appealable under

28 U.S.C. § 1291. See Digital Equipment Corp. v. Desktop Direct,

Inc., 1148. Ct. 1992 (1994). In Digital Equipment, Desktop Direct,

Inc. (“Desktop”) brought a complaint against Digital Equipment

Corporation (“Digital”) alleging the unlawful use of a trade name.

The two parties subsequently entered into a settlement agreement

following which Desktop filed a notice of dismissal.

Several months later, Desktop moved to vacate the dismissal

and rescind the settlement agreement, alleging that Digital had

made misrepresentations of material facts during settlement

negotiations. The district court granted the motion to vacate the

dismissal and Digital appealed to the Tenth Circuit. The Tenth

Circuit dismissed the appeal for lack of jurisdiction, holding that

the district court order was not immediately appealable under the

collateral order doctrine. Id., 114 S. Ct. at 1995.

Digital argued to this Court, as do the Petitioners in the present

case, that refusal to give effect to a settlement agreement should be

immediately appealable on the grounds that such refusal denies

settling parties a privately negotiated “right not to be tried.” Jd. at

2001-02. This Court affirmed the Tenth Circuit’s dismissal of the

appeal, hoiding that “an order denying effect to a settlement

agreement does not come within the narrow ambit of collateral

orders.” Id. at 1994. This Court expressly dismissed the “right not

to be tried” argument, characterizing it as a “losing argument” and

holding “that a refusal to endorse a settlement agreement claimed

to shelter a party from suit altogether does not supply the basis for

immediate appeal under § 1291. Jd. at 2002, 2004.

In their Petition, Utah and Kennecott seek review of the

failure of the district court to give judicial effect to a settlement

agreement between the parties by refusing to approve the

agreement and enter a proposed consent decree. As required, the

district court reviewed the proposed settlement and found that

there was not a sufficient factual foundation from which it could

find that the proposed decree was fair and just. In addition, the

court did find that the proposed decree in two respects was

inconsistent with the purpose and requirements of CERCLA. As a

result, the district court could not and would not put its stamp of

approval on the proposed consent decree and give effect to the

settlement agreement.

Petitioners state that “[i]f denial of this settlement is not

reviewed immediately, then the CERCLA Trustee’s right to bring

and settle this claim will be infringed with no opportunity to

redress.” Petition at 22. This argument is nothing more than

another version of the “right not to be tried” argument that was

expressly rejected by this Court in Digital Equipment.

Recognizing “that Section 1291 requires courts of appeals to view

claims of a ‘right not to be tried’ with skepticism, if not a jaundiced

eye,” this Court explained that there is only a narrow area where

such a right may exist, i.e., where there is an “explicit statutory or

constitutional guarantee that trial will not occur.’ Jd. at 1999. See

4. Very few rights to terminate litigation have been recognized by the

Court as sufficiently “important” to support § 1291 appealability. See, e.g.,

Puerto Rico Aqueduct & Sewer Authority v. Metcalf & Eddy, Inc., 113 S. Ct. 684

(1993) (state’s Eleventh Amendment immunity from suit in federal court);

Mitchell v. Forsyth, 472 U.S. 511 (1985) (denying government qualified

(Cont'd)

also, Lauro Lines S.R.L. v. Chaser, 490 U.S. 495, 503 (1989)

(Scalia J. concurring) (A right not to be tried even if unretrievable,

must be sufficiently important to overcome the policies militating

against the interlocutory appeals). This Court then went on to

explain that the right to be trial-free obtained through a settlement

agreement, as contrasted with a right grounded on an explicit,

statutory or constitutional guarantee of immunity, simply “does

not rise to the level of importance needed for recognition under

§ 1291.”Digital Equipment, 114 S.Ct. at 2001.

Petitioners attempt to distinguish the present case from

Digital Equipment, arguing that Digital Equipment applies only to

“private settlement agreements.” While it is true that the settlement

agreement at issue in Digital Equipment was a “private” settlement

agreement, this Court’s holdings in that case clearly applied to

settlement agreements in general, including consent decrees, and

was not restricted to private settlement agreements. See. e.g.,

Digital Equipment, 114 S. Ct. at 1194 (“We hold that an order

denying effect to a settlement agreement does not come within the

narrow ambit of collateral orders”) (emphasis added); Jd. at 2004

(“We accordingly hold that a refusal to enforce a settlement

agreement claimed to shelter a party from suit altogether does not

supply the basis for immediate appeal under § 1291.”) (emphasis

added).

Digital Equipment is controlling of this Petition. Under this

Court’s clear rulings in that case, the district court’s refusal to enter

the settlement agreement between Uiah and Kennecott is not

immediately appealable under § 1291.

(Cont'd)

immunity from damage suit); Nixon v. Fitzgerald, 457 U.S. 731 (1982) (order

denying President absolute immunity from suit for civil damages arising from

actions taken while President of the United States); Abney v. United States, 431

U.S. 651 (1977) (adverse ruling on a Fifth Amendment double jeopardy claim).

NNN

Il.

THE PETITION FAILS TO QUALIFY UNDER THE

COLLATERAL ORDER EXCEPTION TO THE

FINALITY RULE AS ENUNCIATED IN COHEN V.

BENEFICIAL INDUSTRIAL LOAN CORP., 337 U.S. 541

(1941), AND ITS PROGENY.

Section 1291 of the Judicial Code confines appeals of right to

those from “final decisions of the District Courts.” 28 U.S.C.

§ 1291. For a ruling to be final, it must “end[] the litigation on the

merits and leave nothing for the court to do but execute the

judgment.” Catlin v. United States, 324 U.S. 229, 233 (1945); see

also Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S.

271, 275 (1988). Further, “the judge must clearly declarfe]} his

intention in this respect.” FirsTier Mortgage Co. v. Investors

Mortgage Ins. Co., 498 U.S. 269, 274 (1991). Denial of entry of a

consent decree does not meet the finality requirement. Indeed such

an order insures that the litigation will continue. See Gulfstream

Aerospace, 485 U.S. at 275.

This Court, beginning in Cohen v. Beneficial Indus. Loan

Corp., 337 U.S. 541(1949), recognized a “small class of decisions

that are appealable under Section 1291 even though they do not

terminate the underlying litigation.” This “practical construction”

of the Rule entitles a party to appeal not only from a district court

decision that “ends the litigation on the merits and leaves nothing

more for the court to do but execute the judgment,” Catlin v. United

States, 324 U.S. 229, 233 (1945), but also to appeal from a narrow

class of decisions that must, in the interest of “achieving a healthy

legal system” be treated as final. Digital Equipment Corp. v.

Desktop Direct, Inc., 114. Ct. 1992, 1995 (1994). This Court has

“repeatedly stressed that the ‘narrow’ exception should stay that

way and never be allowed to swallow the general rule that a party is

entitled to a single appeal, to be deferred until final judgment has

been entered, in which claims of district court error at any stage of

the litigation may be ventilated.” /d. at 1996 (citations omitted).

The issue of appealability under § 1291 of this “narrow” class

of decisions “should not, and cannot, depend ona party’s agility in

so characterizing the right asserted,” Jd. at 1998, and “is to be

determined for the entire category to which a claim belongs,

without regard to the chance that the litigation at hand might be

speeded or a ‘particular injustice’ averted by a prompt appellate

court decision.” Jd. at 1996.

This “narrow class” of decisions comprises only those district

court decisions (1) that are conclusive, (2) that resolve important

questions completely separate from the merits, and (3) that would

render such important questions effectively unreviewable on

appeal from final judgment in the underlying action. Jd. at 1995-96

(citing Coopers & Lybrand, 437 U.S. 463, 468 (1978)). The

conditions for collateral order appeal are “stringent” and unless all

three criteria are met, jurisdiction is not available under the

collateral order doctrine. Digital Equipment, 114 S. Ct. at 1996:

Gulfstream Aerospace, 485 U.S. at 276.

The Order of the district court finding the proposed consent

decree in this case deficient and not just, fair or consistent with the

mandates of CERCLA, does not meet any of the prongs of the test

for interlocutory appealability.

A. Certiorari Should Be Denied Because the Petition Fails to

Identify an “Important” Explicit Statutory or Constitutional

Right that Would Supply the Basis of a Collateral Order

Appeal.

In Digital Equipment, this Court explained that

Where statutory and constitutional rights are

concerned, “irretrievabl[e] los{s]” can hardly

be trivial, and the collateral order doctrine

might therefore be understood as reflecting the

familiar principal of statutory construction

that, when possible, courts should construe

Statutes (here § 1291) to foster harmony with

other statutory and constitutional law. .. .

Digital Equipment, 114 S . Ct. at 2002.

This Court then made clear that the right to be trial-free

obtained through a settlement agreement, as contrasted with a right

grounded on an explicit, statutory or constitutional guarantee of

immunity from trial, simply “does not rise to the level of

importance needed for recognition under § 1291.” Id. at 2001.

In their Petition for a Writ of Certiorari, Utah and Kennecott

attempt to circumvent this Court’s ruling in Digital Equipment by

arguing that a CERCLA Trustee has an “explicit statutory right” to

settle claims on its own terms and that this right is “important” as

that term is used in the Cohen test for determining interlocutory

appealability. See Petitioner’s Brief at 9-10.5 There is no such right

“explicit” or even “implicit” inCERCLA.

CERCLA, as its name implies, is a comprehensive

environmental liability act which provides for response to and

cleanup of a release or threatened release of hazardous substances

5. In the court below the Petitioners argued that the “important” issue that

satisfied the Cohen test was whether the district court applied the proper legal

standard in reviewing the consent decree. The fact that the Petitioners had the

option to move pursuant to § 1292 (b) of Title 28 to have the district court certify

the standard of review of aCERCLA consent decree by a district court judge, yet

sought no such certification, undercuts their argument that this issue is an

“important” issue justifying interlocutory appeal. In any event, this Court has

made clear that whether the district court applied the wrong legal standard, is

“patently irrelevant for Section 1291 purposes.” Digital Equipment, 114 S.Ct. at

2000, n.6. Moreover, the court did not apply the wrong standard.

and for compensation for damage to natural resources. The claim

asserted in the district court was a claim for damages to natural

resources pursuant to CERCLA § 107(f), 42 U.S.C. § 9607(f).

Under CERCLA, the natural resource damage trustee does not

have authority to seek remediation or removal action pursuant to

CERCLA, but only the authority to perform those acts as set forth

in § 107(f).

This section provides that the governor of each state shall

designate state officials who may act on behalf of the public as

trustees for natural resources and shall assess the amount of

damage to natural resources for the purpose of seeking monetary

recovery pursuant to this section. The only explicit statutory

authority granted the trustee is authority “to assess damages” and

“to recover for such damages.” CERCLA § 107(f)(1), (2)(B), 42

U.S.C. § 9607(f)(1), (2)(B).

Other provisions of CERCLA relating to the release or

threatened release of hazardous substances provide for and

encourage immediate action to remove the source of

contamination and to remediate or clean up and restore the area

contaminated. In this regard the President is given authority to

enter into agreements to facilitate the speedy abatement of an

actual or threatened release to prevent the contamination. 42

U.S.C. § 9622. However, none of these provisions apply to the

authority of a state natural resource trustee.

There is nothing in CERCLA or in any other statutory or

constitutional provision which grants a natural resource trustee a

right to settle a claim for natural resource damages on its own terms

without review by the district court. To the contrary, as contrasted

with private parties who may settle their disputes on any terms

which they feel reasonable, a natural resource trustee that seeks

and is required by CERCLA to obtain a consent decree from a

district court, can only settle if the court finds that the proposed

consent decree is “reasonable, fair, and consistent with the

purposes that CERCLA is intended to serve.”® United States v.

Cannons Engineering Corp., 899 F.2d 79, 85 (1st Cir. 1990)

(stating that the trial court’s function when reviewing proposed

consent decrees under CERCLA is to “satisfy itself that the

settlement is reasonable, fair and consistent with the purposes that

CERCLA is intended to serve.”) (citing H.R. Rep. No. 253, Pt. 3,

99th Cong., Ist Sess. 19 (1985), reprinted in 1986 U.S. Code Cong.

& Admin. News 3038, 3042)). A consent decree that affects the

public interest or third parties imposes a heightened responsibility

on the courts to protect those interests. This requirement is

intended to protect those who did not participate in negotiating in

the compromise, not those who negotiated it.

Indeed, Petitioners cite to no provision of CERCLA

conferring such a right. For authority supporting the proposition

that “CERCLA explicitly encourages settlement of claims,”

Petitioners cite to CERCLA § 122(a), 42 U.S.C. § 9622(a), a

section that does not even apply to natural resource trustees.’

6. Even the rebuttable presumption provided by CERCLA § 107(f) is not

available to the state trustee in this case. Subsection (2)(C) of § 107(f), provides

that there shall be “a rebuttable presumption on behalf of the trustee in any

administrative or judicial proceeding under this chapter” when the state trustee

determines damages “in accordance with the regulations promulgated under

Section 9651(c)....” In providing this “presumption,” CERCLA clearly

acknowledges that there will be judicial review of any trustee determination and

that the best a trustee can be afforded is a “rebuttable presumption.” In this case,

however, the rebuttable presumption is not available to the trustee because he

chose not to follow regulations promulgated under § 9651(c). See Petition at 33B

(District Court’s Memorandum Decision and Order).

7. The provision referenced by Petitioners in § 122(a) provides “whenever

practicable and in the public interest, as determined by the President, the

President shall act to facilitate agreements under this section that are in the

public interest and consistent with the National Contingency Plan in order to

expedite effective remedial actions and minimize litigation.”

ae ee ee eee a ee ee ee ae ee ee ee ee we ae

Aside from the fact that this section does not apply to a natural

resource trustee, this section does not guarantee a right to settle

even to the President to whom it does apply. At best, it only

“encourages” settlements. See Petition at 15.

Petitioners cite to three cases as support for their proposition

that CERCLA’s primary goal to encourage early settlement confers

on a natural resource trustee a statutory “right” to settle. United

States v. Montrose Chemical Corp., 827 F. Supp. 1453 (C.D. Cal.

1993); In re Achushnet River & New Bedford Harbor, 712 F. Supp.

1019 (D. Mass. 1989); and New York v. Exxon Corp., 697 F. Supp.

677 (S.D.N.Y. 1988). Petition at 15 n.15-16. It is true that these

cases each express the policy favoring settlement of disputes.

However, these cases each explain that before the district court

may approve a proposed consent decree, the court must scrutinize

the adequacy of the settlement. See Montrose Chemical, 827 F.

Supp. at 1458 (“Before initially approving the Proposed Decree in

accordance with CERCLA, this Court must satisfy itself that the

settlement is fair, reasonable, and consistent with the purposes of

CERCLA.”); In Re Achushnet River, 712 F. Supp. at 1027 (“A

multiplicity of factors are considered in evaluating whether the

Proposed Decree before this Court is fair and reasonable. The

protection of the public interest is paramount.”); New York v.

Exxon, 697 F. Supp. at 692 (“The question then is not whether the

Court disregarded any bright line procedural rules governing

CERCLA settlements — there are none — but whether the

procedures chosen provide the Court with sufficient information to

intelligently evaluate the settlement.... Before approving a

CERCLA settlement, the Court must be convinced that it is fair,

adequate, and reasonable, and consistent with the Constitution and

mandate of Congress. ”).

This requirement of judicial review and approval of proposed

settlements was expressed by Congress in enacting CERCLA

§ 122, the very section that Petitioners rely on for their claimed

explicit right to settle. Recognizing that judicial examination and

approval of the settlement is necessary to protect against improper

or “bad faith” settlements, the House Judiciary Committee

explained that “[bJefore initially approving a consent decree under

CERCLA, a court must satisfy itself that the settlement is

reasonable, fair and consistent with the purposes CERCLA is

intended to serve.” H.R. Rep. No. 253 (IID), 99th Cong., 2d. Sess.,

reprinted in, 1986 U.S. Code Cong. & Admin. News 2835, at 3038,

3042. The emphasis on settlement was not absolute. It was the

intention of Congress to require active judicial involvement. “In

order to accomplish this goal of review, all agreements regarding

clean-up must therefore be couched in terms of a consent decree

under Section 106 because this is the only section where a

settlement agreement can be revised and enforced by a court.” Jd.

at 2883.

Certainly Congress did not believe that § 122, the only section

Petitioners refer to in support of their claimed “explicit statutory

right,” conferred a right on anyone (certainly not a natural resource

trustee) to settle on their own terms. Congress provided that

CERCLA settlements would be challenged and reviewed and only

accepted if a district court found them fair and just to the public and

consistent with the Congressional mandate.

Finally, the Section provides that all issues and

matters in the voluntary settlement are subject

to challenge and reviewable by the Federal

District Court in the consent decree process

except the Administrator’s determination to

reimburse parties from the fund. This

legislation preserves all rights of any person

under existing law, including the right to file

suit, the right to intervene and to be a party in

the case.

Id. at 2885.

CERCLA requires that a court examine and approve a

proposed consent decree. Nothing in CERCLA, either “implicit”

or “explicit,” grants a right to a natural resource trustee to settle

damage claims on its own terms.

B. The District Court’s Order Did Not Resolve an Important

Issue Completely Separate from the Merits of the Action.

In addition to requiring an “important issue,” the second

prong of the Cohen test requires that the issue being raised on

appeal be “completely separate from the merits of the action.”

Coopers & Lybrand, 437 U.S. at 468. The issue raised by

Petitioners of whether a trustee has the unfettered explicit statutory

right to settle a natural resource claim goes to the very heart of the

litigation — whether the trustee’s proposed consent decree is just,

fair and consistent with CERCLA.

CERCLA clearly requires a reviewing court to determine a

natural resource trustee’s right to settle in light of the factual basis

of the claim and whether it is fair and just in light of those facts and

the purposes of CERCLA. This determination is enmeshed in the

factual and legal issues comprising the Petitioners’ causes of

action. In fact, in their docketing statements to the Tenth Circuit,

Petitioners’ acknowledge that the issues raised on appeal included

whether the district court erred in making certain findings of fact

with regard to the sufficiency of the factual basis of the proposed

settlement. See Portions of Docketing Statements Filed by

Petitioners with the Tenth Circuit (attached hereto as Appendix C).

Because the issues on appeal involve considerations that are

inextricably intertwined with the factual issues going to the merits

of the case, the issues on appeal are not appealable under the

collateral order doctrine. See Midland Asphalt Corp. v. United

States, 489 U.S. 794 (1989).

C. Denial of Entry of a Consent Decree Does Not Conclusively

Determine the Parties’ Ability to Settle Their Claims.

To satisfy the first prong of the Cohen test the district court’s

denial of the consent decree must conclusively determine the

parties’ abilities to settle their claims. Orders that are “inherently

tentative,” that is, when “a district court ordinarily would expect to

reassess and revise such an order ‘in the ordinary course of

litigation,’ ” do not meet this requirement. Gulfstream, 485 U.S. at

277-278; Moses H. Cone Memorial Hospital v. Mercury

Construction Corp., 260 U.S. 1, 12-13 n.14(1983).

The district court’s Order denying effect to a proposed consent

decree is inherently tentative. The district court did not

“necessarily contemplate” that the decision will close the matter

for all time. In denying the motion, the district court determined

only that it should await further study and support. It does no more

than permit Petitioners to propose a new consent decree within the

bounds of substantive fairness. Utah v. Kennecott Corp., 14 F.3d at

1494, Petition at 9A-10A. The court may also reconsider the

rejected proposal upon a proper foundational basis. As the Tenth

Circuit pointed out, Utah and Kennecott “are free to continue with

renewed settlement efforts and further proceedings to secure court

approval. Although the trial court concluded that Utah and

Kennecott had not met their burden of substantive fairness under

CERCLA, the trial court did not foreclose future proposed consent

decrees.” Utah v. Kennecott Corp., 14 F.3d at 1493; Petition at 8A.

Because the denial was not made with the expectation that it will be

the final word on the trustee’s ability to settle, it is not a conclusive

determination within the meaning of the collateral order doctrine.

D. A Right to Settle and Not to Proceed with Litigation Is Not

an Important Right Effectively Unreviewable on Appeal after

Judgment.

Utah and Kennecott also argue that, since they lost the right to

a ee

settle on the specific terms of the proposed consent decree, they

lost an important right that cannot be vindicated effectively after

the trial has concluded. This Court, in Digital Equipment,

concluded that, contrary to Petitioners’ argument, “rights under

private settlement agreements can be adequately vindicated on

appeal from final judgment.” Digital Equipment, 114 S. Ct. at

1996.

If immediate appellate review were allowed every time a

trustee appointed pursuant to some statute was denied entry of a

settlement agreement, “Congress’ final decision rule would end up

a pretty puny one and so the mere identification of some interest

that would be ‘irretrievably lost’ has never sufficed to meet the

third Cohen requirement.” Digital Equipment, 114 S. Ct. at 1998.

The order of the district court refusing to enter a consent decree on

the grounds that the settlement is deficient, not just, fair or

consistent with the mandates of CERCLA, does not meet the third

prong of the Cohen/Digital Equipment test.

Il.

THE PETITION DOES NOT PRESENT AN ISSUE IN

CONFLICT AMONG THE COURTS OF APPEALS. THE

COURTS ARE IN AGREEMENT THAT A DISTRICT

COURT’S REFUSAL TO APPROVE A PROPOSED

SETTLEMENT AGREEMENT IS NOT APPEALABLE

UNDER 28 U.S. C. § 1291.

Petitioners argue that this Court should grant certiorari to

resolve a conflict among circuit courts as to whether a district

court’s rejection of a settlement agreement is “conclusive” and

thus immediately appealable under 28 U.S.C. § 1291. In

examining the alleged conflict, it is important to note the

distinction between cases involving a court’s refusal to enter a

proposed settlement agreement (as is the situation in the present

case) and cases involving a court’s refusal to enforce a pre-existing

settlement agreement.

With regard to the first line of cases, the circuit courts of

appeals are in uniform agreement — a court’s refusal to approve a

proposed settlement agreement is not appealable under § 1291.°

The only conflict that existed between the courts of appeals

involved the second line of cases — cases involving a court’s

refusal to enforce an existing settlement agreement, a situation not

at issue in the present case. The issue in this second group of cases

8. See Utah v. Kennecott, 14 F.3d 1489 (10th Cir. 1994) (holding that

denial by a district court of entry of a consent decree does not meet either the first

or second prong of the Cohen test and is not appealable pursuant to § 1291);

E.E.0O.C. v. Pan American World Airways, Inc., 796 F.2d 314, 318 n.7 (9th Cir.

1986), cert. denied, 479 U.S. 1030 (1987) (concluding that Carson v. American

Brands, Inc., 450 U.S. 79 (1981) had “explicitly resolved a conflict among the

circuits concerning whether and pursuant to what statute an interlocutory order

disapproving a consent decree was appealable.” The Ninth Circuit thus

disavowed its prior decision in Norman v. McKee, 431 F.2d 769 (9th Cir. 1970),

cert. denied, 401 U.S. 912 (1971), in which the court had held that a refusal to

enter a consent decree was appealable under § 1291); Donovan v. Robbins, 752

F.2d 1170, 1172 (7th Cir. 1985) (stating in dicta that a “judge’s action in refusing

to approve the [consent] decree was not a final decision, appealable under 28

U.S.C. § 1291.”); New York v. Dairlea Cooperative, Inc., 698 F.2d 567, 570 n.10

(2d Cir. 1983) (stating in dicta that a judge’s rejection of a proposed settlement

agreement as neither adequate nor fair was “not appealable pursuant to 28 U.S.C.

§ 1291.”); Seigal v. Merrick, 590 F.2d 35, 36 (2d Cir. 1978) (holding “that the

refusal of the District Court to approve a settlement in a stockholder derivative

action is not appealable under § 1291); Carson v. American Brands, Inc., 606

F.2d 420, 423-24 (4th Cir. 1979) (approving of Seigal as an analogous case

though dismissing on § 1292(a)(1) grounds), rev'd on other grounds, 450 U.S.

79 (1981)); Roach v. Churchman, 457 F.2d 1101, 1104 (8th Cir. 1972) (holding

that an order denying entry of a consent judgment is not appealable on the

grounds that the order cannot be deemed collateral to the main action).

, aid

ee ee Ee ee Ne ee en

- 27

centered on whether the “right not to be tried” was a right the denial

of which was immediately appealable.°

This Court expressly granted certiorari in Desktop Direct “to

resolve this conflict” and did so by holding that “the right not to be

tried” does not supply the basis for an immediate appeal under

§ 1291. Digital Equipment, 114 S. Ct. at 2004. Thus, this Court has

conclusively resolved any conflict that may have existed with

regard to the appealability of pretrial orders refusing to enforce

preexisting settlement agreements.

The distinction between cases involving a court’s refusal to

enter a proposed settlement agreement and cases involving a

court’s refusal to enforce a pre-existing settlement agreement is

perhaps best understood by examining what Petitioners perceive to

be a conflict between two opinions from the Second Circuit, Seigal

v. Merrick, 590 F.2d 35 (2d Cir. 1978) and Janneh v. GAF Corp.,

887 F.2d 432 (2d Cir. 1989). In Seigal, the Second Circuit held that

an order refusing to approve a proposed settlement in a

stockholders’ derivative action was not appealable under § 1291.

In Janneh, the Court held that an order denying enforcement of a

pre-existing settlement agreement was immediately appealable.

9. Compare Desktop Direct, Inc. v. Digital Equip. Corp., 993 F.2d 755

(10th Cir. 1993), aff'd, 114 S. Ct. 1992 (1994) (holding that a broad and

unbounded “right not to be tried” is no grounds for immediate appeal) and

Transtech Industries, Inc. v. A & Z Septic Clean, 5 F.3d 51, 55 (3d Cir. 1993)

(following Desktop Direct in rejecting the “right not to be tried” as the basis for

appealability under § 1291 and concluding “that the district court’s denial of

summary judgment and refusal to enforce a settlement is a collateral order not

appealable under the Cohen exception.”) with Forbus v. Sears, Roebuck & Co.,

958 F.2d 1036 (11th Cir., cert. denied, 113 S. Ct. 412 (1992) (granting

jurisdiction to review a denial of enforcement of a settlement on grounds of a

right not to go to trial); Grillet v. Sears, Roebuck & Co., 927 F.2d 217 (Sth Cir.

1991) (same); and Janneh v. GAF Corp., 887 F.2d 432 (2d Cir. 1989) (same),

cert. denied, 498 U.S. 865 (1990).

In Janneh, the Second Circuit explained that the order

regarding a preexisting settlement agreement “is quite distinct

from that considered in Seigal v. Merrick,” in that the agreement in

Janneh required no inquiry into the merits of the case. The only

question in Janneh was whether the parties had reached a

settlement. In Seigal, however, a decision whether to approve a

proposed settlement required the court to examine the merits of the

case by weighing “the sufficiency of the settlement.” Janneh, 887

F.2d at 435 n.4. When factual issues such as sufficiency of

settlement remain in dispute, interlocutory appeals are not

authorized. See also Chaput v. Unisys Corp., 964 F.2d 1299 (2d

Cir. 1992) (explaining Janneh).

In the present case, as in Seigal, the District Court was not

faced with the issue of whether a settlement had been reached

between Utah and Kennecott. Rather, the Court was presented with

the task of determining whether the proposed settlement

agreement reached by Utah and Kennecott was “reasonable, fair,

and consistent with the purposes that CERCLA is intended to

serve.” Because factual issues concerning the sufficiency of the

settlement agreement at issue in this case remain in dispute, the

Tenth Circuit correctly held that the district court’s refusal to

approve the settlement is not immediately appealable. This

decision is not in conflict with opinions of other courts of appeals

or with the Supreme Court’s opinion in Digital Equipment.

IV.

PETITIONERS HAVE IMPROPERLY RAISED AN

ISSUE IN THE PETITION FOR CERTIORARI THAT

WAS NOT PRESENTED BELOW.

This Court has made clear that, although not precluded from

doing so, the Court will “not normally decide issues not presented

below.” Carlson v. Green, 446 U.S. 14, 17 (1980); see also Air

Courier Conference of American vy. American Postal Workers

Union, 498 U.S. 517, 522, 111 S. Ct. 913, 917 (1991) (refusing to

consider issue not argued to either of the lower courts); DeShaney

v. Winnebago County Dep't of Social Services, 489 U.S. 189, 195

(1989) (declining to consider issue not argued to the Court of

Appeals).

In their Petition for a Writ of Certiorari, Utah and Kennecott

ask this Court to consider whether a CERCLA Trustee has a

statutory or constitutional right to settle claims on its own terms

and whether this right, if it exists, is “important” as that term is

used in the Cohen test for determining interlocutory appealability.

Petitioner’s Brief at 9. This is an issue that the Petitioners did not

raise before the Tenth Circuit Court of Appeals.

In their brief regarding appellate jurisdiction filed in the court

below, Petitioners argued that the central issue in the appeal which

allegedly satisfied the “important” requirement of Cohen was “the

correct standard of review to be applied to a proposed settlement of

a natural resource damages claim by a federal district court.” See

Joint Memorandum Brief of the State of Utah and Kennecott

Corporation Regarding Appellate Jurisdiction (pertinent portions

of which are attached as Appendix D), at 23a-24a. See also,

Portions of Docketing Statements Filed by Petitioners with the

Tenth Circuit (Appendix C), at 20a-21a (Petitioners list “Issues to

Be Raised on Appeal” as (1) “Whether, in reviewing the Proposed

Consent Decree, the District Court applied incorrect legal

standards. . . .” and (2) Whether the District Court erred in making

certain findings of fact with regard to the sufficiency of the factual

basis of the proposed settlement). This Court has previously

explained that an argument that interlocutory appealability can be

based on a district court’s applying the “wrong legal standard”

must be rejected “as patently irrelevant for § 1291 purposes.”

Digital Equipment, 114 S. Ct. at 2000 n.6.

Petitioners did not argue to the Tenth Circuit that a natural

resource trustee has a “statutory” right to settle natural resource

claims on its own terms and that the denial of such a right, if it

exists, is “important” under Cohen. Consequently, this Court

should refuse to now consider this issue on a Writ of Certiorari.

CONCLUSION

This Petition does not present a special or important issue for

review. The law in this area has been recently clarified by this

Court’s Opinion in Digital Equipment. There is no need to reaffirm

that opinion, the law is clear and any possible conflict among the

courts of appeals was resolved by Digital Equipment. The Petition

for Certiorari should be denied.

Respectfully submitted,

DOUGLAS J. PARRY

Counsel of Record

KEVIN R. MURRAY

JAMES K. TRACY

PARRY MURRAY WARD

& MOXLEY

DALE F. GARDINER

Salt Lake County Water

Conservancy District

Attorneys for Respondent

APPENDIX A — CERCLA § 107(f), 42 U.S.C. § 9607(f)

CERCLA § 107(f), 42 U.S.C. § 9607(f):

(f) Actions involving natural resources; maintenance, scope

etc.

(1) Natural resources liability

In the case of an injury to, destruction of, or loss of natural

resources under subparagraph (C) of subsection (a) of this section

liability shall be to the United States Government and to any State

for natural resources within the State or belonging to, managed by,

controlled by, or appertaining to such State and to any Indian tribe

for natural resources belonging to, managed by, controlled by, or

appertaining to such tribe, or held in trust for the benefit of such

tribe, or belonging to a member of such tribe if such resources are

subject to a trust restriction on alienation: Provided, however, That

no liability to the United States or State or Indian tribe shall be

imposed under subparagraph (C) of subsection (a) of this section,

where the party sought to be charged has demonstrated that the

damages to natural resources complained of were specifically

identified as an irreversible and irretrievable commitment of

natural resources in an environmental impact statement, or other

comparable environment analysis, and the decision to grant a

permit or license authorizes such commitment of natural

resources, and the facility or project was otherwise operating

within the terms of its permit or license, so long as, in the case of

damages to an Indian tribe occurring pursuant to a Federal permit

or license, the issuance of that permit or license was not

inconsistent with the fiduciary duty of the United States with

respect to such Indian tribe. The President, or the authorized

representative of any State, shall act on behalf of the public as

trustee of such natural resources to recover for such damages.

Sums recovered by the United States Government as trustee under

Appendix A

this subsection shall be retained by the trustee, without further

appropriation, for use only to restore, replace, or acquire the

equivalent of such natural resources. Sums recovered by a State as

trustee under this subsection shall be available for use only to

restore, replace, or acquire the equivalent of such natural resources

by the State. The measure of damages in any action under

subparagraph (C) of subsection (a) of this section shall not be

limited by the sums which can be used to restore or replace such

resources. There shall be no double recovery under this chapter for

natural resource damages, including the costs of damage

assessment or restoration, rehabilitation, or acquisition for the

same release and natural resource. There shall be no recovery

under the authority of subparagraph (C) of subsection (a) of this

section where such damages and the release of a hazardous

substance from which such damages resulted have occurred

wholly before December 11, 1980.

(2) Designation of Federal and State officials

(A) Federal

The President shall designate in the National Contingency

Plan published under section 9605 of this title the Federal officials

who shall act on behalf of the public as trustees for natural

resources under this chapter and section 1321 of Title 33. Such

officials shall assess damages for injury to, destruction of, or loss

of natural resources for purposes of this chapter and such section

1321 of Title 33 for those resources under their trusteeship and

may, upon request of and reimbursement from a State and at the

Federal officials’ discretion, assess damages for those natural

resources under the State’s trusteeship.

Appendix A

(B) State

The Governor of each State shall designate State officials who

may act on behalf of the public as trustees for natural resources

under this chapter and section 1321 of Title 33 and shall notify the

President of such designations. Such State officials shall assess

damages to natural resources for the purposes of this chapter and

such section 1321 of Title 33 for those natural resources under their

trusteeship.

Any determination or assessment of damages to natural

resources for the purposes of this chapter and section 1321 of Title

33 made by a Federal or State trustee in accordance with the

regulations promulgated under section 9651(c) of this title shall

have the force and effect of a rebuttable presumption on behalf of

the trustee in any administrative or judicial proceeding under this

chapter or section 1321 of Title 33.

* * *

- 4a

APPENDIX B — UTAH V. KENNECOTT, CASE NO. C86-

902, PORTIONS OF TRANSCRIPT OF OCTOBER 25, 1991

HEARING (D. UTAH)

IN THE UNITED STATES DISTRICT COURT

IN AND FOR THE DISTRICT OF UTAH

CENTRAL DIVISION

Case No. C86-902

STATE OF UTAH, BY AND THROUGH THE UTAH STATE

DEPARTMENT OF HEALTH,

Plaintiff,

vs.

KENNECOTT CORPORATION,

Defendant.

Salt Lake City, Utah

Date: October 25, 1991

Time: 2:00 p.m.

REPORTER’S TRANSCRIPT

BEFORE: THE HONORABLE J. THOMAS GREENE

APPEARANCES OF COUNSEL:

For the Plaintiff: FRED G. NELSON, ESQ. and

DENICE CHANCELLOR, ESQ.

Appendix B

For the Defendant: JAMES LEE, ESQ.

DAVID TUNDERMANN, ESQ.

ROBERT LONERGAN, ESQ.,

RICHARD PIERCE, ESQ.,

DALLIN JENSEN, ESQ.., and

DALE BUTLER, ESQ.

For the Intervenor: DOUGLAS PARRY, ESQ.

DALE F. GARDINER, ESQ. and

BLAKE ATKIN, ESQ.

For Utah Chapter Sierra Club: KENLEY W. BRUNSDALE, ESQ.

Court Reporter: REEVE M. BUTLER, RPR

Official Court Reporter

Rm. 224 Federal Bldg.

350 S. Main Street

Salt Lake City, Utah 84101

Tel. 328-0837

* * *&

[108] on that chart, and those assumptions are all before you, Your

Honor.

The explanation of that process is in the administrative record.

In fact, I’m reading from or my notes are pages 2 and 3 of

Kennecott’s response to the public comments.

THE COURT: And does — have you presented and is it

before me how those assumptions are translated into 12 million

dollars?

Appendix B

MR. TUNDERMANN: No, Your Honor.

THE COURT: Why didn’t you say $24 million or $6 million?

MR. TUNDERMANN: We each had our bottom lines, Your

Honor, and somewhere in the bargaining a deal was struck; that’s

what —

THE COURT: How can I tell whether what you have done is

reasonable?

MR. TUNDERMANN: We have described to you our

process.

THE COURT: Are you describing the process?

MR. TUNDERMANN: We have described the process. I

believe, your Honor, under the cases, for the settlement to be

approvable by the court, it needs to be fair and reasonable and

consistent with the statute.

Fairness is measured by essentially a procedural [109] test

where the parties are sufficiently adversarial, that the settlement

they strike can be regarded as a fair one and if we come to you

together and make that representation, I think we're entitled to a

presumption that it is fair.

Reasonableness — and these cases are cited in our report,

Your Honor. The Cannon Engineering case, the Vertac Chemical

case, the Roman Haws case; the courts have said: In reviewing

CERCLA consent decrees, courts defer to the judgment of the

Environmental Enforcement Agency that negotiates the decree,

since the agency has the expertise to determine whether a decree

will help or hinder the effort.

Appendix B

THE COURT: So really all I need to know is whether you

people really believe that it’s just and reasonable and fair, and you

having said that, that’s an adequate basis for the court to determine,

yes, it must be fair and reasonable.

MR. TUNDERMANN: If you conclude, Your Honor —

THE COURT: Is that what you’ re saying to me?

MR. TUNDERMANN: I’m saying to you, if you believe our

representations that we were adversarial and discussions were

across the table at arm’s length, if you believe our representations

that we had sharply adverse interests and balanced a lot of complex

competing factors to reach a resolution, and if you believe that the

settlement is consistent with the statute, that’s all you need to

believe.

THE COURT: Well, I could approve any figure you [110]

came up with then; that’s all I need, just your statement that it’s fair.

I mean, you could have got by for $6 million.

MR.TUNDERMANN: Yes, we might have; that would have

been a better deal for us and a less good deal for the state, but that’s

not where we wound up.

THE COURT: Because th. state agreed to $12 million,

you’ re saying that’s the only necessary factual basis for the court to

have, having satisfied itself that here are adversarial parties, they

have bargained, they negotiated, they looked at all of the facts, they

bargained and drove a hard bargain and that should be approved

because they were adversary parties.

MR. TUNDERMANN: Absent evidence of collusion or bad

faith, I think that’s all Your Honor needs.

Appendix B

THE COURT: I think you demonstrated in your papers that

the court has no business trying to determine what the very best

settlement could be; of trying to find out if there is a better possible

settlement; that isn’t the business of the court.

The business of the court is to determine whether the

settlement that you’ ve arrived at is just and fair and I’m a little

troubled about the basis on which I’ m asked to come to that.

I’ll take the matter under advisement, all matter under

advisement; court’s in recess.

* *« *

[111]

(Hearing concluded)

REPORTER’S CERTIFICATE

STATE OF UTAH

COUNTY OF SALT LAKE

I, REEVE M. BUTLER, do hereby certify that I am an Official

Court Reporter for the United States District Court for the District

of Utah;

That as such Reporter I attended the hearing of the foregoing

matter on October 25, 1991, and thereat reported in Stenotype all

of the testimony and proceedings had, and caused said notes to be

transcribed inio typewriting; and the foregoing pages numbered

from 2 to 111 constitute a full, true and correct report of the same.

DATED at Salt Lake City, Utah, this 17th day of December,

1991.

Appendix B

s/ Reeve M. Butler

REEVE M. BUTLER, RPR

10a

APPENDIX C — PORTIONS OF DOCKETING

STATEMENTS FILED WITH THE TENTH CIRCUIT

BY PETITIONERS

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

DOCKETING STATEMENT

Case Name: Utah v. Kennecott

Court/Agency: United States District Court for the District of

Utah, Central Division

Court/Agency Docket No.: CV 8&6-0902G

District Judge: J. Thomas Greene

Party or Parties filing Appeal/Petition: Defendant Kennecott

Corporation

I. TIMELINESS OF APPEAL OR PETITION FOR REVIEW

A. Appeal from District Court

1. Date notice of appeal filed: October 2, 1992

a. Wasa motion filed for an extension of time to file notice

of appeal? If so, give the filing date of the motion, the

date of any order disposing of the motion, and the

deadline for filing notice of appeal: No

b. Is the United States or an officer or an agency thereof a

party to this appeal? No

- Lla

Appendix C

2. Authority fixing time limit for filing notice of appeal:

Fed. R. App. P. 4 (a)(1)

3. Date final judgment or order to be reviewed was filed and

entered on district court docket sheet: September 3, 1992

a. Does the judgment or order to be reviewed dispose of all

claims by and against all parties? SEE Fed. R. Civ. P.

54(b). No

12a

Appendix C

ATTACHMENT TO DOCKETING STATEMENT

for the

UNITED STATES COURT OF APPEAL

FOR THE TENTH CIRCUIT

Utah v. Kennecott Lower Docket No. 86-0902G

I.3.c. If the judgment or order is not a final disposition, is it

appealable under 28 U.S.C. § 1292(a)?

Yes. The District Court refused to enter the consent

decree in part because that decree did not order Kennecott

to control potential sources of ground water contamination

or to contain and manage the existing plume of

contamination. Thus, the Court’s Order has the practical

affect of requiring an injunction as a condition of

settlement and is therefore appealable under 28 U.S.C.

§ 1292(a)(1).

GIVE BRIEF DESCRIPTION OF NATURE OF ACTION

AND RESULT BELOW.

This is an action for natural resource damages under

section 107 of the federal Comprehensive Environmental

Response, Compensation and Liability Act (“CERCLA”)

42, U.S.C. § 9607. A complaint was filed on October 3,

1986 by the State of Utah, by and through the Utah

Department of Health, against defendant Kennecott

Corporation, alleging that Kennecott was responsible for

damages to ground water resources under the trusteeship of

the State of Utah within the meaning of CERCLA. Further

proceedings were stayed pending completion of technical

studies, and further stays were granted to allow settlement

13a

Appendix C

negotiations to proceed. As a result of these stays, as of the

filing of this Docketing Statement, Kennecott has not filed

an answer to the complaint.

On July 30, 1991, a settlement was reached between the

State of Utah, represented by the Director of the Utah

Department of Environmental Quality, the individual

designated by the Governor as the Trustee for natural

resources pursuant to CERCLA § 9607(f)(2), and

defendant Kennecott Corporation. The terms of the

settlement were embodied in a proposed consent decree

and released for public review and comment. The parties

evaluated the comments received, modified the proposed

consent decree to respond to comments, and on September

23, 1991, submitted a modified consent decree to the

District Court for approval and entry. The District Court

ordered a discovery period and evidentiary hearing on four

issues related to the proposed consent decree and the status

of a potential intervenor. That evidentiary hearing began

on March 23, 1992 and lasted for six days. Closing

arguments were heard on May 14, 1992. On September 3,

1992, the District Court entered an Order denying the

request to approve and enter the Consent Decree, granting

the motion to intervene, and directing the parties to submit

a discovery plan. Defendant Kennecott appeals from the

September 3, 1992 Order.

ISSUES TO BE RAISED ON APPEAL.

A. Whether, in reviewing the Proposed Consent Decree,

the District Court applied incorrect legal standards,

including

l4a

Appendix C

applying a “preponderance of the evidence”

standard;

refusing to accord any presumption of validity to

the settlement agreed to by the parties; and

failing to consider other relevant factors relating to

the litigation, including a comparison of the

strengths of the plaintiff’s case versus the amount

of the settlement offer, the likely complexity,

length and expense of the litigation, the opinion of

competent counsel, the stage of the proceedings

and the amount of discovery already undertaken at

the time of settlement, and the potential benefits

associated with immediate payment of damages in

weighing the fairness and reasonableness of the

settlement?

B. Whether the District Court erred by refusing to defer to

the judgment of the Trustee (the Director of Utah’s

Department of Environmental Quality), and instead

substituting the Court’s judgment for the Trustee’s on

the following issues:

technical studies in support of the settlement were

adequate;

restoration of the ground water aquifer through

active treatment was not technically feasible;

source control and remediation of the aquifer were

more appropriately addressed through in separate

negotiations involving the federal Environmental

15a

Appendix C

Protection Agency, rather than incorporated into

the natural resource damages settlement;

4. nature and extent of damage to the ground water

aquifer caused by Kennecott was properly

measured by the settlement;

5. the value of the damaged ground water was

properly measured; and

6. the amount of the settlement was reasonable?

C. Whether the District Court erred in rejecting the

Proposed Consent Decree because the settlement did

not include relief that the Trustee was not authorized by

CERCLA to seek or require?

D. Whether the District Court properly stated the measure

of damages under CERCLA?

E. Whether the District Court erred in: (1) refusing to

approve the settlement as structured by the Trustee;

and (2) not permitting the Trustee to settle, even though

the Trustee assumed for purposes of the settlement —

contrary to fact — that the use of all water within a

specified area (the “Mining Impact Area”) would be

lost forever, and limited the release and covenant not to

sue Kennecott only to any injury to natural resources

within the Mining Impact Area?

F. Whether, if reviewed under the proper legal standards,

with appropriate deference to the settlement of the

parties and the Trustee’s technical judgment, the

16a

Appendix C

evidence before the District Court required the

conclusion that the Proposed Consent Decree is fair,

reasonable and consistent with the requirements of

CERCLA?

INDICATE WHETHER ORALARGUMENTIS DESIRED

IN THIS APPEAL. IF SO, WHY IN YOUR OPINION

SHOULD ARGUMENT BE HEARD?

Oral argument is desired. Oral argument on this appeal

should be heard because CERCLA is a notoriously

complicated statute and the standards governing judicial

scrutiny of a CERCLA natural resource dams es

settlement have not been decided by the Tenth Circuit

Court of Appeals or the United State Supreme Court.

Appellant believes that oral argument will assist the Court

in reviewing (1) the provisions of CERCLA applicable to

the Order being appealed from; (2) the standard of review

that the District Court should have applied to the Proposed

Consent Decree; and (3) the terms of the Proposed Consent

Decree.

17a

Appendix C

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

DOCKETING STATEMENT

Case Name: STATE OF UTAH V. KENNECOTT

Court/Agency: UNITED STATES DISTRICT COURT FOR THE

DISTRICT OF UTAH, CENTRAL DIVISION

Court/Agency Docket No.: CV 86-0902G

District Judge: J. THOMAS GREENE

Party or Parties filing Appeal/Petition: PLAINTIFF STATE OF

UTAH

I. TIMELINESS OF APPEAL OR PETITION FOR REVIEW’

A. Appeal from District Court

1. Date notice of appeal filed: OCTOBER 16, 1992

a. Wasa motion filed for an extension of time to file notice

of appeal? If so, give the filing date of the motion, the

date of any order disposing of the motion, and the

deadline for filing notice of appeal: NO

b. Is the United States or an officer or an agency thereof a

party to this appeal? NO

2. Authority fixing time limit for filing notice of appeal:

Fed. R. App. P. 4 (a)(3)

- 18a

Appendix C

3. Date final judgment or order to be reviewed was filed and

entered on district court docket sheet: SEPTEMBER 3,

1992

a. Does the judgment or order to be reviewed dispose of all

claims by and against all parties? SEE Fed. R. Civ. P.

54(b). NO

19a

Appendix C

ATTACHMENT TO DOCKETING STATEMENT

for the

UNITED STATES COURT OF APPEAL

FOR THE TENTH CIRCUIT

UTAH V. KENNECOTT LOWER DOCKET NO. 86-0902G

Ill.

GIVE BRIEF DESCRIPTION OF NATURE OF ACTION

AND RESULT BELOW.

The State filed this action for natural resource damages

under section 107 of the federal Comprehensive

Environmental Response, Compensation and Liability Act

(“CERCLA”), 42 U.S.C. § 9607. Acomplaint was filed on

October 3, 1986 against defendant Kennecott Corporation,

alleging that Kennecott was responsible for damages to

surface and ground water resources. The proceedings were

stayed pending completion of a 5-year study to define the

nature and extent of the contamination.

On July 30, 1991, a proposed settlement was filed with

the District Court and made available for public review and

comment. The State and Kennecott evaluated the

comments received, modified the proposed consent decree

to respond to comments, and on September 23, 1991,

submitted a Modified Consent Decree to the District Court

for approval and entry. The Salt Lake Water Conservancy

District moved to intervene opposing entry of the Modified

Consent Decree. The District Court ordered a discovery

period and evidentiary hearing on the proposed consent

decree and intervention request. An evidentiary hearing

began on March 23, 1992 and lasted for six days. Closing

arguments were heard on May 14, 1992. On September 3,

20a

Appendix C

1992, the District Court entered a Memorandum Decision

and Order denying the request to approve and enter the

Modified Consent Decree and allowed permissive

intervention by the Water Conservancy District. Defendant

Kennecott appealed from the September 3, 1992 Order

(Appeal No. 92-4173). The District filed a cross-appeal.

The State of Utah has also now filed an appeal from the

Order.

ISSUES TO BE RAISED ON APPEAL

Did the District Court use the correct standard of

review and consider the relevant factors in making the

determination that the Modified Consent Decree was

not fair and reasonable and consistent with the

provisions of CERCLA?

Did the District Court err by not giving deference to

the conclusions of the State Trustee appointed under

§ 107 (f) of CERCLA, on the technical studies that

support the settlement, specifically on the nature and

extent of the contamination, the feasibility of

restoration, and the value of the injury to the resource.

Did the District Court err in concluding that the State

Trustee did not use a valuation method for injury to

natural resources which was consistent with

CERCLA?

Did the District Court err in concluding that a Decree

settling .a State Trustee’s claim for natural resource

damage must contain requirements for remedial

measures to be consistent with CERCLA?

2la

Appendix C

E. Did the District Court err in making findings which

did not recognize the limitation in the scope of the

Modified Consent Decree as a settlement of only

claims for injury to groundwater and surface water

within the Mining Impact Area?

22a

APPENDIX D — PORTIONS OF JOINT MEMORANDUM

BRIEF OF THE STATE OF UTAH AND KENNECOTT

CORPORATION REGARDING APPELLATE

JURISDICTION

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

Case Nos. 92-4173

92-4179

92-4180

THE STATE OF UTAH, BY AND THROUGH THE UTAH

STATE DEPARTMENT OF HEALTH,

Plaintiff-Appellant,

VS.

KENNECOTT CORPORATION,

Defendant-Appellant,

SALT LAKE COUNTY WATER CONSERVANCY DISTRICT,

Intervenor-Appellee.

On Appeal from the United States District Court

District of Utah, Central Division

Honorable J. Thomas Greene, Jr., District Judge

Civil No. 86-C-0902G

JOINT MEMORANDUM BRIEF OF THE STATE OF UTAH AND

KENNECOTT CORPORATION REGARDING APPELLATE

JURISDICTION AND JOINT RESPONSE TO THE SALT LAKE

COUNTY WATER CONSERVANCY DISTRICT’S MOTIONS TO

DISMISS FOR LACK OF JURISDICTION

23a

Appendix D

R. Paul Van Dam James B. Lee

Fred G Nelson Daniel M. Allred

Utah Attorney General’s David W. Tundermann

Office Jim Butler

236 State Capitol Bldg. of and for

Salt Lake City, Utah 84114 PARSONS BEHLE & LATIMER

Telephone: (801) 538-1017 201 South Main Street, Suite 1800

Attorneys for Appellant P.O. Box 11898

State of Utah Salt Lake City, Utah 84147-0898

Telephone: (801) 532-1234

Attorneys for Appellant

Kennecott Corporation

* * *

B. The Order Resolves An Important Issue Completely

Separate From The Merits Of The Action

As explained above, the central issue in this appeal is the

correct standard of review to be applied to a proposed settlement of

a natural resource damages claim by a federal district court. That

question is important — because it effectively determines a

Trustee’s ability to settle such a claim — and it is completely

separate from the merits of the underlying claim. Accordingly,

appellate review of the Order would not involve “considerations

that are ‘enmeshed in the factual and legal issues comprising’ ”

Utah’s claim for natural resource damages. See Coopers &

Lybrand, 437 U.S. at 469 (quoting Mercantile Nat’l Bank v.

Langdeau, 371 U.S. 555, 558 (1963)).

More generally, appeal of the Order is collateral to the merits

of the underlying claim because Utah and Kennecott negotiated

24a

Appendix D

and submitted the Modified Consent Decree for the purpose of

ending the litigation and avoiding a trial on the merits of the action.

Thus, the review of the Modified Consent Decree, either by the

district court in the first instance or by this Court on appeal, does

not involve an inquiry into the merits of Utah’s claim for natural

resource damages. Cf. In re General Motors Corp. Engine

Interchange Lit., 594 F.2d 1106, 1118-19 (7th Cir.) (order

approving subclass settlement was appealable as a collateral order

because it was “completely separate from the merits of the

action”), cert. denied, 444 U.S. 879 (1979).

x» * *

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.