# Amicus Curiae Brief — Teck Cominco Metals, Ltd. v. Pakoototas (No. 06-1188)

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2006

## Text

FILED
No. 06-1188 MAY 0 2 2007

eee
IN THE OFFICE OF THE CLERK

SUPREME COURT, U.S.

Supreme Court of the United States

TECK COMINCO METALS, LTD.,
Petitioner,
Vv.

JOSEPH A. PAKOOTAS, DONALD R. MICHEL,
AND STATE OF WASHINGTON,
Respondents.

On Petition for a Writ of Certiorari
to the United States Court of Appeals
for the Ninth Circuit

BRIEF OF THE CHAMBER OF COMMERCE OF
THE UNITED STATES OF AMERICA AS
AMICUS CURIAE IN SUPPORT OF
PETITION FOR A WRIT OF CERTIORARI

Of Counsel: CARTER G. PHILLIPS*
ROBIN S. CONRAD MARINN F. CARLSON
AMAR DT). SARWAL SIDLEY AUSTIN LLP
NATIONAL CHAMBER 1501 K Street, N.W.

LITIGATION CENTER, INC. Washington, D.C. 20005
1615 H Street, N.W. (202) 736-8000

Washington, D.C. 20062
(202) 463-5337
Counsel for Amicus Curiae

May 2, 2007 * Counsel of Record
SRP RENN SR tn a AEN RRA ERE OS PAREN <I ROR

WitSON-EPES PRINTING CO., INC. -— (202) 789-0096 - VWaASHINGTON, D. C. 20002

TABLE OF CONTENTS

Page
EE PAE? B PERIUEE 8 BIEO cocevcecvevescecesevescsencssocecsscceooove il
INTEREST OF AMICUS CURIAL.....ccccccssesssossesvccesesesers l
BACKGROUND AND INTRODUCTION ........0........... 2
REASONS FOR GRANTING THE PETITION.............. 3

I. THE LOWER COURT’S DECISION THREAT-
ENS INTERNATIONAL DISCORD AND
INTERFERES WITH U.S. FOREIGN POLICY .. 6

Il. THE DECISION BELOW WILL HAVE
SUBSTANTIAL ADVERSE CONSE-
QUENCES FOR THE BUSINESS COM-
SIT ilsticcdsensonsveerdreosevesersévteeesserorersesoceceoes 12

TT a iaisuisdeideseceusevensoevaccesesesocorecoveseorsseorsers 15

(1)

TABLE OF AUTHORITIES
CASES Page
American Banana Co. v. United Fruit Co., 213
Fe RSI mE OD TT 3
Chicago & S. Air Lines v. Waterman S.S. Corp.,
Fe is Pe aviaciicaidaeetanieaanidetnitiiiaion 1]
Crosby v. National Foreign Trade Council, 530
Sse. Se aT ccecactseiessomsiessibpinsrbanaceetielealbagidibenentcDtch 11

EEOC vy. Arabian Am. Oil Co., 499 U.S. 244
(1991), superseded by statute on other grounds,
Civil Rights Act of 1991, Pub. L. No. 102-166,
105 Stat. 1074, as recognized in Landgraf v.
USI Film Prods., 511 U.S. 244 (1994) ..... 2, 3, 4, 5, 6
F. Hoffman-La Roche Ltd. v. Empagran S.A., 542

SF ie Ba a siehnidineaterastinneaniniaiiipdatiadiien 6
Foley Bros. Inc. v. Filardo, 336 U.S. 281 (1949)... 4
Hartford Fire Ins. Co. v. California, 509 U.S. 764

Cee ainsisstdaasieedinnieaisndenscleiiehbenihaadeaabanaanibsadaibeigaiaboaiie 5
McCulloch v. Sociedad Nacional de Marineros de

Honduras, 372 U.S. 10 (1963)...........ccceeceeeeeseeees 6
Microsoft Corp. v. AT&T Corp., No. 05-1056,

Sap Ge. CIB. ABE. Fey BOOT Perecnccersescecnceeretcereeates 2,4
N.L.R.B. v. Catholic Bishop of Chi., 440 U.S. 490

COSI y a iscceniavielesiesispieidapsssduntaagianblahanadheanpeininaliteiicsianndeien 6

Pakootas v. Teck Cominco Metals Lid., 452 F.3d
1066 (9th Cir. 2006), petition for cert. filed, 75
U.S.L.W. 3483 (U.S. Feb. 27, 2007) (No. 06-

Sa ckaissscatseisiceinilachisaneacicatataiaidiebdanmdedaamoncanamaanes 2,5
Sale v. Haitian Ctrs. Council, Inc., 509 U.S. 155

CIPI sansenistnnasienaeiediaibsssonssnibeteliaaiaesiaaminadadaelleliidenmaaet 5, 6
Smith v. United States, 507 U.S. 197 (1993)........... 4
Spector v. Norwegian Cruise Line Lid., 545 U.S.

Be ee iitsinaioctuisdehaciceedcideiuaniuenaabiuiadanmiadaadaed 6

Steele v. Bulova Watch Co., 344 U.S. 280
Petit snustavsdacannivcaicsamasiiiasutiicadaisaaiadiate aaa 5

ill
TABLE OF AUTHORITIES—continued

United States v. Mitchell, 553 F.2d 996 (Sth Cir.

TREATIES

1909 Boundary Waters With Canada Treaty,
U.S.-Gr. Brit., Jan. 11, 1919, 36 Stat. 2448.........
1972 Great Lakes Water Quality Agreement,
U.S.-Can., Apr. 15, 1972, 23 U.S.T. 301.............
1978 Great Lakes Water Quality Agreement,
U.S.-Can., Nov. 22, 1978, 30 U.S.T. 1383..........
Convention on Long-Range Transboundary Air
Pollution, Nov. 13, 1979, 34 U.S.T. 3043.00.00...
Memorandum of Intent Concerning Transboun-
dary Air Pollution, U.S.-Can., Aug. 5, 1980, 32
1k a. RGR Ene nO a ena a ae

SCHOLARLY AUTHORITIES

John E. Carroll, Environmental Diplomacy: An
Examination and a Prospective of Canadian-
U.S. Transboundary Environmental Relations
ari incighdllsacscieschiscesclealieebiipeiiccinnbipeicadiacmnabaeisaaiicaabiels

Arthur T. Downey, Extraterritorial Sanctions in
the Canada/U.S. Context, 24 Can-U.S. L.J. 215
Sertich titres bik nipseeipeinbaclnedscdascnaiabibuiaahasabdeseiposi

Sanford E. Gaines, NAFTA as a Symbol on the
Border, 51 UCLA L. Rev. 143 (2003).................

L.H. Legault, The Roles of Law and Diplomacy in
Dispute Resolution: The IJC as a Possible
Model, 26 Can.-U.S. L.J. 47 (2000)...

Page

1]

iV
TABLE OF AUTHORITIES—continued
Page
Michael S$. McMahon, Balancing the Interests:
An Essay on the Canadian-American Acid Rain
Debate, in International Environmental Diplo-
macy: The Management and Resolution of
Transfrontier Environmental Problems 147
fh TE | | 13
Austen L. Parrish, Trail Smelter Déja Vu:
Extraterritoriality, International Environmental
Law, and the Search for Solutions to Canadian-
U.S. Transboundary Water Pollution Disputes,
SS BA). ba. BBY: FOS CAO Ce) cevevesevercseceisinvesesvieraees 13
Elia V. Pirozzi, Resolution of Environmental
Disputes in the United States-Mexico Border
Region and the Departure from the Status Quo,
12 J. Eavtl. L.. & Litt. 371 CIGS7) ..ccccccccosecseseesss 9
Shawn M. Rosso, Acid Rain: The Use of
Diplomacy, Policy and the Courts to Solve a
Transboundary Pollution Problem, 8 J. Nat.

Resources & Envtl. L. 42] (1993) ........cceceeees 8,9
John D. Wirth, Smelter Smoke in North America:
The Politics of Transborder Pollution (2000) ..... 10
OTHER AUTHORITIES

Env’t Can., Comments on the U.S. EPA's
Proposed National Emission Standards for
Hazardous Air Pollutants (Mar. 30, 2004),
available at http://www.ec.gc.ca/mercury/en/
is sierrricnnadintirnsitcimssiescinnecltaeniinss 13

Memorandum from Marianne L._ Horinko,
Assistant Administrator, U.S. EPA, to
Superfund National Policy Managers, Regions
1-10 & RCRA Senior Policy Advisors, Regions
1-10 (Feb. 12, 2002)

Vv

TABLE OF AUTHORITIES—continued

Page
Int’! Joint Comm’n, Detroit River Area of
Concern: Status Assessment (1997), available
at http://www. ijc.org/php/publications/html]/
i iiiainccctatinintuiccuiacilidesunetiiniinsictoenssinneapiin 9
Nordic Council of Ministers, Cadmium Review —
RIE GRE ESAs cence er Ree ae 15
Nordic Council of Ministers, Lead Review
EEE iidiahincenvndsmstpineretesavouniiotsne Nad 15

Rebecca Renner, Science News: Asia Pumps Out
More Mercury than Previously Thought, Envtl.
Sci. & Tech. Online (American Chemical
Society), Jan. 5, 2005, available at http://pubs.
acs.org/subscribe/journals/esthag-w/2005/jan/
I BI BIN cicoicccincecaicnenienisieniniinitistinonmen 14
U.S. EPA, Contaminated Sediment Remediation ,
Guidance for Hazardous Waste Sites (2005),
available at http://www.epa.gov/superfund/
resources/sediment/pdfs/guidance.pdf................. 12

INTEREST OF AMICUS CURIAE'

The Chamber of Commerce of the United States of
America (the “Chamber’”) is the world’s largest business
federation, representing an underlying membership of more
than three million U.S. businesses and organizations from
every region of the country. An important function of the
Chamber is to advocate its members’ interests in matters of
national concern before all branches and at all levels of
government. In this role, the Chamber has often filed briefs
as amicus curiae before federal and state courts, including
before this Court.

The Chamber seeks to highlight in this brief the importance
of the present case to the U.S. business community and the
negative consequences—both diplomatic and economic—that
would flow from allowing the Ninth Circuit’s flawed and
expansive interpretation of the Comprehensive Environmental
Response, Compensation and Liability Act (“CERCLA”) to
stand.

The complex problem of transboundary pollution has
historically been addressed through a variety of bilateral and
multilateral diplomatic mechanisms. By displacing these
cooperative arrangements in favor of piecemeal litigation that
projects U.S. environmental regulations abroad, the Ninth
Circuit’s ruling, if allowed to stand, not only would interfere
with the foreign affairs prerogatives of the political branches
of government, but also would disrupt the settled expectations
of the business community.

''No person other than the amicus curiae, its members, or its counsel
has made any monetary contribution to the preparation or submission of
this brief. Further, no counsel for any Petitioner or Respondent authored
this brief in whole or in part. Counsel of record for both parties have
consented to the filing of this brief amicus curiae, and the letters of
consent have been filed with the Clerk.

2

Further, by extending CERCLA’s statutory reach to
activities carried out by a foreign company on foreign soil,
the Ninth Circuit’s decision risks provoking foreign
governments to attempt to impose similar liability on U.S.
companies for activities those companies undertake within the
United States’ borders. Such retaliation would seriously
damage the interests of the Chamber’s members doing
business in the border regions of the United States and would
inject uncertainty and unpredictability into the regulatory
framework within which they operate.

The Chamber has a vital interest in promoting a predictable
legal environment for its members—something that is
seriously threatened by the Ninth Circuit’s unprecedented
expansion of CERCLA liability in this case.

BACKGROUND AND INTRODUCTION

This case raises an issue of critical importance to this
nation’s business community: the applicability of U.S.
environmental laws to the conduct of foreign persons that
takes place wholly within the sovereign territory of a foreign
nation. This Court has long recognized — and reaffirmed just
days ago — that acts of Congress are presumed “to apply only
within the territorial jurisdiction of the United States,” unless
a “clearly expressed” contrary intention is apparent from the
legislation. EEOC v. Arabian Am. Oil Co. (“Aramco”), 499
U.S. 244, 248 (1991) (quoting Foley Bros. Inc. v. Filardo,
336 U.S. 281, 285 (1949) and Benz v. Compania Naviera
Hidalgo, S.A., 353, U.S. 138, 147 (1957)); Microsoft Corp. v.
AT&T Corp., No. 05-1056, slip op. at 15-16 (U.S. Apr. 30,
2007). Instead of confronting directly the issue of whether
Congress intended liability under CERCLA to apply to |
conduct that takes place exclusively outside the United States,
the Ninth Circuit sidestepped the presumption against
extraterritoriality altogether. See Pakootas v. Teck Cominco
Metals Lid, 452 F.3d 1066, 1078 (9th Cir. 2006)
(determining that the presumption against extraterritoriality

3

did not apply because the passive “release” of heavy metals
from slag occurred domestically). That decision is not only
inconsistent with existing law but also gives rise to serious
diplomatic and economic implications; it requires this Court’s
review.

Notwithstanding the Ninth Circuit’s attempt to avoid the
question whether CERCLA can be applied extraterritorially,
its decision implicates the very concerns that the presumption
against extraterritorial statutory application was designed to
guard against—namely, the “unintended clashes between our
laws and those of other nations which could result in
international discord.” Aramco, 499 U.S. at 248. The
question of whether to apply the presumption is more than
simply an academic exercise. The Ninth Circuit’s ruling
extends CERCLA liability to a Canadian corporation whose
conduct took place exclusively in the territory of Canada in
compliance with Canadian law. This is a development with
serious consequences for diplomatic relations between
Canada and the United States, as well as for businesses on
both sides of the border. And the potential consequences of
the decision below extend well beyond the United States’
relationship with its closest neighbor. The importance of the
scope of the presumption against extraterritoriality, and the
ramifications of the Ninth Circuit’s failure to apply that
presumption, make the need for this Court’s review
particularly evident.

REASONS FOR GRANTING THE PETITION

Almost a century ago, in American Banana Co. v. United
Fruit Co., 213 U.S. 347, 356 (1909), Justice Holmes
articulated the basic premise upon which the presumption
against the extraterritorial application of U.S. law is based:
“{T]he general and almost universal! rule is that the character
of an act as lawful or unlawful must be determined wholly by
the law of the country where the act is done.” /d. Since that
time, this Court has consistently reaffirmed that the

4

presumption is directly implicated whenever . a litigant
attempts to apply U.S. law to conduct that takes place outside
of the United States. See Aramco, 499 U.S. at 249-51 (Title
VII of the Civil Rights Act of 1964 does not regulate the
employment-related conduct of American firms employing
American citizens abroad);? Foley Bros. v. Filardo, 336 U.S.
281, 285-86 (1949) (federal labor statute does not apply to
impose liability on a private contractor for conduct that took
place in a foreign country); Smith v. United States, 507 U.S.
197, 204 (1993) (Federal Tort Claims Act does not apply to
tort claims based on acts or omissions occurring abroad).

This Court recently emphasized the importance of this
principle. Observing that “United States law applies
domestically but does not rule the world,” Microsoft, slip op.
at 15, and that “foreign conduct is [generally] the domain of
foreign law,” id. (quoting Brief for the United States as
Amicus Curiae at 28, Microsoft, No. 05-1056), this Court held
that §271(f) of the Patent Act does not apply to activity
occurring abroad. In so holding, the Court reiterated the
presumption that “legislators take account of the legitimate
sovereign interests of other nations when they write American
laws.” Jd. at 15 (quoting F. Hoffman-La Roche Lid. v.
Empagran S.A., 542 U.S. 155, 164 (2004)).

Despite the undisputed fact that the conduct for which
Petitioner, a Canadian company, is allegedly liable under
CERCLA took place exclusively on foreign soil, the Ninth
Circuit concluded that the presumption against
extraterritoriality was not implicated at all here. The court
reasoned that because the “release” of hazardous substances
occurred in the United States, this case involved a purely

? The Court's interpretation of Title VII in Aramco was superseded by
Congress’s enactment of the Civil Rights Act of 1991, Pub. 2, No. 102-
166, 105 Stat. 1074, as recognized in Landgraf v. USI Film Prods., 5\1
U.S. 244, 251 (1994). That statutory revision, however, does not
undermine the presumption against extraterritoriality as invoked in
Aramco.

5

domestic application of CERCLA. Pakootas, 452 F.3d at
1078. That reasoning, however, took no account of the
critical question of whether Congress intended CERCLA to
impose liability for Petitioner’s wholly extraterritorial
conduct. Instead, the panel simply side-stepped this issue by
defining the application of CERCLA in this case as
“domestic.” |

The ascertainment of affirmative congressional intent is a
necessary prerequisite for a U.S. court to apply U.S. statutory
liability to conduct that occurs entirely outside the United
States. See Aramco, 499 U.S. at 248 (holding that the
presumption applies “unless there is ‘the affirmative intention
of the Congress clearly expressed’”) (quoting Benz, 353 U.S.
at 147)); Sale v. Haitian Ctrs. Council, Inc., 509 U.S. 155,
176 (1993) (affirming that the: presumption requires
“affirmative evidence of intended _ extraterritorial
application”). Even in those instances in which this Court has
determined that the presumption against extraterritoriality has
been overcome, it has done so because it concluded that there
existed an affirmative congressional decision to allow such an
extraterritorial application. See, e.g., Hartford Fire Ins. Co.
v. California, 509 U.S. 764, 796 & n.22 (1993) (recognizing
that Congress intended the Sherman Act to apply “to foreign
conduct that was meant to produce and did in fact produce
some substantial effect in the United States”); Steele v.
Bulova Watch Co., 344 US. 280, 285, 287 (1952)
(concluding that “Congress intended to make the [the Lanham
Act] applicable to the facts of this case.”) (internal quotation
mark omitted)). In this case, the Ninth Circuit conducted no
such inquiry into congressional intent to apply CERCLA
liability to wholly foreign conduct.

The Ninth Circuit’s determination that the presumption
against extraterritoriality was inapplicable in this case is
directly contrary to this Court’s established precedent. That
flaw is responsible for more than simply a wrong result or a
legal inconsistency—it carries with it significant real-world

6

consequences for U.S. foreign policy (and the ability of the
Executive branch to effectively conduct such policy) as well
as for the U.S. business community. These consequences
present compelling reasons for this Court to grant certiorari in
this case.

I. THE LOWER COURT’S DECISION THREATENS
INTERNATIONAL DISCORD AND INTERFERES
WITH U.S. FOREIGN POLICY.

The presumption against the extraterritorial application of
U.S. law is designed largely to prevent “unintended clashes
between our laws and those of other nations which could
result in international discord.” Aramco, 499 U.S. at 248; see
also Spector v. Norwegian Cruise Line Lid., 545 U.S. 119,
143 (2005) (Ginsburg, J. concurring in part and concurring in
the judgment) (“[BJefore reading our law ‘to run interference
in such a delicate field of international relations,’ ‘where the
possibilities of international discord are so evident and
retaliative action so certain’ the Court should await Congress’
clearly expressed instruction.”) (quoting Benz, 353 U.S. at
147)). This rationale has roots in the twin concerns of
international comity, see F. Hoffman-La Roche Lid. v.
Empagran S.A., 542 U.S. 155, 164 (2004) (“[T]his Court
ordinarily construes ambiguous statutes to avoid unreasonable
interference with the sovereign authority of other nations.”),
and the separation of powers, see Sale, 509 U.S. at 188
(“[The] presumption has special force when we are construing
treaty and statutory provisions that may involve foreign and
military affairs for which the President has unique
sesponsibility.”). In the “presence of highly charged
international circumstances,” McCulloch v. Sociedad
Nacional de Marineros de Honduras, 372 U.S. 10, 21 (1963),
the presumption serves tO prevent a court from reading a
Statute “so as to give rise to a serious question of separation of
powers which in turn would . . . implicate[] sensitive issues of
the authority of the Executive over relations with foreign
nations,” N.L.R.B. v. Catholic Bishop of Chicago, 440 U.S.

J

490, 500 (1979). These twin concerns are directly implicated
in this case and compellingly support certiorari.

The Ninth Circuit’s disregard of the presumption against
extraterritorial statutory reach risks triggering serious
diplomatic consequences. The Canadian government has
already protested on international comity grounds the
extension of CERCLA liability to Petitioner’s exclusively
Canadian operations. See Gov’t of Canada’s Amicus Curiae
Brief in Support of Appellant and Reversal of the Order of the
District Court, Pakootas v. Teck Cominco Metals Ltd., 452
F.3d 1066 (9th Cir. 2006) (No. 05-35153). The reason for
Canada’s protest is clear: by projecting CERCLA’s standards
onto the sovereign territory of Canada, the panel’s decision
disrupts the integrity of a foreign country’s environmental
scheme by imposing upon it a potentially inimical set of
priorities. This can only serve to harm relations between the
United States and one of its most important allies. Cf. Arthur
T. Downey, Extraterritorial Sanctions in the Canada/U.S.
Context, 24 Can-US. LJ. 215, 215 (1998)
(“[E]xtraterritoriality is an unwanted intrusion into a
country’s sovereignty, and Canada sometimes suffers
nightmares about the firmness and durability of its own
sovereignty. It naturally bristles when the ugly head of
extraterritoriality appears, especially if it is an American
head.”).

The extraterritorial application of CERCLA also needlessly
interferes with the foreign affairs prerogatives of the political
branches of the U.S. government. Current U.S. foreign policy
has recognized that the problem of cross-border pollution is
best addressed through bilateral or multilateral diplomatic
mechanisms. The reciprocal nature of the problem makes it
inappropriate for resolution by the unilateral projection of the
country’s domestic laws onto its neighbors’ territory. Instead,
the United States and other countries have found it preferable,
and very often successful, to pursue joint measures to reduce
the overall output of pollutants into the shared natural

8

environment. The United States and Canada are parties to
many regional and global agreements that address
transboundary pollution through such cooperative efforts.
See, e.g., Memorandum of Intent Concerning Transboundary
Air Pollution, U.S.-Can., Aug. 5, 1980, 32 U.S.T. 2521;
Convention on Long-Range Transboundary Air Pollution,
Nov. 13, 1979; 1978 Great Lakes Water Quality Agreement,
U.S.-Can., Nov. 22, 1978, 30 U.S.T. 1383; 1972 Great Lakes
Water Quality Agreement, Apr. 15, 1972, United States-
Canada, 23 U.S.T. 301; 1909 Boundary Waters Treaty With
Canada, U.S.-Gr. Brit., Jan. 11, 1909, 36 Stat. 2448. The
United States has also been involved in numerous
negotiations addressing environmental problems in specific
border areas. See generally John E. Carroll, Environmental
Diplomacy. An Examination and a Prospective of Canadian-
U.S. Transboundary Environmental Relations (1983)
(describing the history of U.S.-Canadian cross-border
environmental diplomacy).

As a result of these agreements and negotiations, there
exists a robust network of inter-governmental mechanisms
dealing with the problem of cross-border contamination.
Most prominently, the 1909 Boundary Waters Treaty between
the United States and Canada established a_ bilateral
International Joint Commission that is charged with resolving
disputes concerning the control of boundary water quality,
including transboundary pollution, and is vested with quasi-
judicial, investigative and arbitral functions. The subsequent
Great Lakes Water Quality Agreements have expanded the
powers of the Commission, and over the years the
Commission has successfully resolved a number of disputes
between the two countries. See L.H. Legault, The Roles of
Law and Diplomacy in Dispute Resolution: The JC as a
Possible Model, 26 Can.-U.S. L.J. 47, 49-54 (2000); Shawn
M. Rosso, Acid Rain: The Use of Diplomacy, Policy and the
Courts to Solve a Transboundary Pollution Problem, 8 J. Nat.
Resources & Envtl. L. 421, 424-25 (1993) (“The IJC has been

9

an innovative approach to dealing with common problems
arising on the border. In effect, it has institutionalized an
acknowledgement of the importance of cooperation in
addressing common environmental issues.”’).

Characteristic of this successful cooperative approach to
transboundary pollution is the Commission’s investigation,
upon a joint request by the United States and Canada, of the
issue of air pollution in the Detroit river area, which
encompasses the metropolitan areas of Detroit, in the State of
Michigan, and Windsor, in the Province of Ontario. Having
concluded that the responsibility for the pollution was shared
by both sides, the Commission recommended, and the United
States and Canada subsequently created, a joint institution to
address the problem. See Int’! Joint Comm’n, Detroit River
Area of Concern: Status Assessment (1997), available at
http://www.ijc.org/php/publications/html/detroit.html; Rosso,
supra, at 424.

A similarly extensive diplomatic system of dispute
resolution has been established to address pollution on the
U.S. and Mexican border. See Elia V. Pirozzi, Resolution of
Environmental Disputes in the United States-Mexico Border
Region and the Departure from the Status Quo, 12 J. Envtl. L.
& Litig. 371, 373-86 (1997) (discussing dispute resolution
under NAFTA, North American Agreement’ on
Environmental Cooperation and Environmental Dispute
Resolution, “La Paz” Agreement Between the U.S. and
Mexico on Cooperation for the Protection and Improvement
of the Environment in the Border Area, and Integrated
Environmental Border Plan for the Mexican-United States
Border Area). These agreements have allowed the two
countries to solve a number of significant environmental
problems in the border area. Under the “La Paz” agreement,
for instance, a collaborative effort by the U.S. and Mexico has
dramatically improved air quality in the E] Paso-Ciudad
Juarez border region, and has substantially reduced pollution
from copper smelters in Arizona in the United States and

10

Sonora in Mexico. See Sanford E. Gaines, NAFTA as a
Symbol on the Border, 51 UCLA L. Rev. 143, 161 (2003);
John D. Wirth, Smelter Smoke in North America: The Politics
of Transborder Pollution 175-99 (2000).

The Ninth Circuit’s extension of CERCLA liability to
Petitioner’s wholly foreign conduct risks disrupting these and
other well-functioning diplomatic schemes. It places a matter
traditionally handled through diplomacy by the Executive
into the hands of individual private litigants who: can
unilaterally pursue CERCLA suits without any regard for the
foreign policy and international environmental consequences
for the nation as a whole. The firmly established presumption
against extraterritorial application of federal legislation,
which the Ninth Circuit refused to apply, is designed to
prevent precisely this dangerous and counterproductive
exercise.

Absent a clear showing of congressional intent to apply
’ federal law abroad, the authority to resolve the sensitive
problem of cross-border environmental relations is vested in
the federal Executive acting through its diplomatic
representatives. Such authority is an element of the
President’s broader power to, in the words of the Solicitor
General, “promote the effective conduct of foreign relations,
and underscore the United States’ commitment in the
international community to the rule of law.” Brief for the
United States as Amicus Curiae Supporting Petition for
Certiorari at 8, Medellin v. Texas, No. 06-984.

As the Fifth Circuit has observed in an analogous situation,
when considering whether to give extraterritorial application
to the Marine Mammal Protection Act of 1972:

When Congress considers environmental legislation, it
presumably recognizes the authority of other sovereigns
to protect and exploit their own resources. Other states
may strike balances of interests that differ substantially
from those struck by Congress. The traditional method

1]

of resolving such differences in the international
community is through negotiation and agreement rather
than through the imposition of one particular choice by a
state imposing its law extraterritorially.

United States v. Mitchell, 553 F.2d 996, 1002 (Sth Cir. 1977).

These mechanisms allow the Executive Branch to evaluate
the nation’s environmental priorities, to take account of the
diplomatic sensitivities involved, and to respond in a manner
that appropriately combines the determination and the
flexibility necessary to solve the complex issues surrounding
transboundary pollution. That responsibility, moreover, is
particularly appropriate because “the President is uniquely
positioned both to evaluate and resolve sensitive foreign
policy issues and to act with dispatch.” Brief for the United
States as Amicus Curiae Supporting Petition for Certiorari at
12, Medellin, No. 06-984.

By contrast, this Court has emphasized the limited capacity
of the Judicial Branch to “determin[e] precisely when foreign
nations will be offended by particular acts” and has
“consistently acknowledged that the nuances of the foreign
policy of the United States ... are much more the province of
the Executive Branch and Congress” than of the courts.
Crosby v. National Foreign Trade Council, 530 U.S. 363, 386
(2000) (quoting Container Corp. of Am. v. Franchise Tax Bd.,
463 U.S. 159, 194, 196 (1983)) (internal quotation marks
omitted) (alteration and omission in original).

The Ninth Circuit’s failure even to consider, much less to
apply the presumption against extraterritoriality in this case
fosters not only unnecessary tension between governments
but also inappropriate conflict between the U.S. branches of
government, as the judiciary attempts to tread where it “has
neither aptitude, facilities nor responsibility.” Chicago & S.
Air Lines v. Waterman S.S. Corp., 333 U.S. 103, 111 (1948).

12

II. THE DECISION BELOW WILL HAVE SUBSTAN-
TIAL ADVERSE CONSEQUENCES FOR THE
BUSINESS COMMUNITY.

Regardless of whether the application of CERCLA in this
case is labeled as “domestic” or “extraterritorial,” by
attaching liability to conduct that occurred wholly outside the
~ United States, the Ninth Circuit’s decision will detrimentally
affect many of the Chamber’s members and affiliates, as well
as the U.S. business community in general. United States
companies and individuals are actively engaged in business
operations in the regions bordering Canada. These companies
will be exposed to substantial risk if, in response to this and
similar suits against its nationals, Canada retaliates by
extending its own environmental laws to U.S. companies
operating on the U.S. side of the border and by opening its
courts to similar types of lawsuits.

The Ninth Circuit’s projection of CERCLA abroad
effectively subjects foreign companies operating outside the
United States to the U.S. environmental regulatory regime.
There is no way to escape that consequence of the Ninth
Circuit’s decision, given that CERCLA relies on regulating
conduct that gives rise to releases of pollution. See
Memorandum from Marianne L. Horinko, Assistant
Administrator, U.S. EPA, to Superfund Nat’] Policy
Managers, Regions 1-10 & RCRA Senior Policy Advisors,
Regions 1-10, at 2-3 (Feb. 12, 2002) (“Principles for
Managing Contaminated Sediment Risks at Hazardous Waste
Site”); U.S. EPA, Contaminated Sediment Remediation
Guidance for Hazardous Waste Sites § 2.6 (2005), available
at __ http://www.epa.gov/superfund/resources/sediment/pdfs/
guidance.pdf (“Identifying and controlling contaminant
sources typically is critical to the effectiveness of any
Superfund sediment cleanup.”).

If private litigants are permitted to use CERCLA lawsuits
to target foreign companies’ operations outside of the United
States, these companies will find themselves forced to

13

conform their conduct to U.S. environmental requirements for
fear of liability. They will have to do so even if those U.S.
requirements find no correlation in the domestic legislation of
the country in which they operate.

As a result, Canadian companies faced with the unexpected
requirement to comply not only with their country’s domestic
regulation but also with CERCLA (and, potentially, other
U.S. environmental statutes) when acting solely on Canadian
soil will have every incentive to pressure their government to
respond. See Austen L. Parrish, Trail Smelter Déja Vu:
Extraterritoriality, International Environmental Law, and the
Search for Solutions to Canadian-U.S. Transboundary Water
Pollution Disputes, 85 B.U. L. Rev. 363, 414 (2005) (“Little
reason exists to believe that Canada would not ultimately
respond similarly if the U.S. CERCLA laws are read to apply
extraterritorially to Canadian companies doing business solely
in Canada.”). The Ninth Circuit’s insistence that this case
involves only a “domestic” application of CERCLA is cold
comfort to Canadian companies and is unlikely to alleviate
this cross-border tension, given that under that court’s
approach CERCLA liability can attach to conduct exclusively
outside the United States.

In response, Canada could very well try to “level the
playing field” between companies on either side of the border
by imposing corresponding liability on companies operating
within U.S. territory whenever their operations produce
pollution that later ends up in Canada. Canada already
contends that pollutants released by some U.S. companies
migrate across national boundaries and account for air and
water pollution in certain regions of Canada. See Env’t Can.,
Comments on the U.S. EPA’s Proposed National Emission
Standards for Hazardous Air Pollutants (Mar. 30, 2004),
available at http://www.ec.gc.ca/mercury/en/mcepa.cfm#
ECC (reporting that 10 percent of the mercury deposited in
Canada each year comes from U.S. sources}; Michael S.
McMahon, Balancing the Interests: An Essay on _ the

14

Canadian-American Acid Rain Debate, in {International
Environmental Diplomacy: The Management and Resolution
of Transfrontier Environmental Problems 147, 147 (John E.
Carroll ed., 1988) (“The issue [of acid rain] has been
identified by Canada’s minister of the environment as the
‘single most important irritant in US-Canadian relations.’”).
If Canada wishes to retaliate for the Ninth Circuit’s
unwarranted intrusion into its sovereignty, it will find an easy
basis under that court’s reasoning for imposing liability upon
U.S. businesses. The risk that Canada would open the door to
proceedings against U.S. companies, premised on the U.S.
companies’ failure to comply with Canadian environmental
standards in their domestic U.S. activities, will severely
undermine business confidence.

The resulting instability in the governing regulatory
framework likely will disrupt existing projects in the border
regions and deter companies from undertaking new ones. The
need to become familiar with foreign laws and regulations,
and to conform domestic company activities to these
requirements, would impose a significant informational and
operational cost on all businesses in the border regions.
Likewise, the prospect of inconsistent lawsuits and liability
verdicts would inflict considerable damage on the economic
cooperation between the United States and Canada and
decrease the prospects for bilateral investment.

Furthermore, the Ninth Circuit’s extraterritorial application
of CERCLA is potentially unbounded. If CERCLA liability
can attach any time pollution eventually ends up in the United
States regardless of its source, it could be easily extended to
cover air and water pollution emanating from non-border
countries. Cf. Rebecca Renner, Science News: Asia Pumps
Out More Mercury than Previously Thought, Envtl. Sci. &
Tech. Online (American Chemical Society), Jan. 5, 2005,
available at http://pubs.acs.org/subscribe/journals/esthag-
w/2005/jan/science/rr_asia.html (discussing scientific
investigation of long-range transport of atmospheric

15

pollutants from Asia); Nordic Council of Ministers, Lead
Review 11 (2003) (reporting to the United Nations
Environment Programme on the long-range air transport of
lead emissions); Nordic Council of Ministers, Cadmium
Review 9 (2003) (reporting on the long-range air transport of
cadmium). Given the sweeping nature of cross-border
contamination, a limitless range of foreign companies
operating solely on foreign soil could be captured by the
Ninth Circuit’s expansive interpretation of our domestic laws.
Correspondingly, the Ninth Circuit’s rationale would permit
any foreign nation that can trace at least some of its
environmental pollution to economic activity occurring in the
United States to subject the alleged polluter to protracted
litigation and potential liability in that country. The risk of
retaliation against U.S. companies thus extends well beyond
the United States’ closest neighbors.

CONCLUSION

For the foregoing reasons, the petition for a writ of
certiorari should be granted.

Respectfully submitted,

Of Counsel: CARTER G. PHILLIPS*
ROBIN S. CONRAD MARINN F. CARLSON
AMAR D. SARWAL SIDLEY AUSTIN LLP
NATIONAL CHAMBER 1501 K Street, N.W.

LITIGATION CENTER, INC. Washington, D.C. 20005
1615 H Street, N.W. (202) 736-8000

Washington, D.C. 20062
(202) 463-5337

Counsel for Amicus Curiae
May 2, 2007 * Counsel of Record

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_2229%3A10. Public record. Not legal advice.