# 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

(4) MAY 2 - 2007

OFFICE OF THE CLERK
No. 06-1188 L-SUPREME COURT, U.S.

IN THE

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 GOVERNMENT OF CANADA
AS AMICUS CURIAE IN SUPPORT OF PETITIONER

Dean Sherratt Margaret K. Pfeiffer

Of Counsel Counsel of Record
Department of Foreign Affairs Erin Chlopak
and International Trade SULLIVAN & CROMWELL LLP
Lester B. Pearson Building 1701 Pennsylvania Avenue, NW
Floor: C7 - Room: 266 Washington, DC 20006
125 Sussex Drive Telephone: (202) 956-7500
Ottawa, Ontario Canada Fax: (202) 293-6330

Telephone: (613) 992-6486
Fax: (613) 992-6483

Counsel for Amicus Curiae the Government of Canada
Fe at ected nak Bent Acacias et Alyn

TABLE OF CONTENTS

Page
ET PRMD PUG TIRE BLEED crorcesesesnvecsvovecerscnsersssesssoserscones TT
THE INTEREST OF AMICUS CURIAE THE
Sear vy eee OF CANADA. .........cccccrssscsssrsserssseseseseees 2
RPINPRES © CIE PAIRGIUIMEINE ...cccceccssocesseresvesenseversessseesees 4
ala sussdsevneavesceveeveesyveseevsevereeessesees 7
}. THE COURT OF APPEALS ERRED IN FAILING

TO RECOGNIZE THAT TRANSBOUNDARY
ENVIRONMENTAL ISSUES SHOULD BE
RESOLVED THROUGH STATE-TO-STATE
BILATERAL COOPERATION AND NOT
THROUGH PRIVATE LITIGATION. .................. 7

II. THE COURT OF APPEALS ERRED BY
PRESUMING THE APPLICATION OF
CERCLA WITHOUT CONSIDERING THE
PRINCIPLE OF COMITY OF NATIONG........... 10

A. The Principle of Comity of Nations. .......... 10

B. The Ninth Circuit Ignored Comity In
Concluding That CERCLA Could Be
Applied to Petitioner In This Case. ........... 11

C. Principles of Comity Are Violated By the
Ninth Circuit’s Holding That CERCLA Could
Be Applied To Foreign Companies Operating
Solely Outside the United States............... 13

LE EE OE 14

il
TABLE OF AUTHORITIES
Page(s)
UNITED STATES CASES

Carson Harbor Vill., Ltd. v. Unocal Corp.,

SO Ce ORF COU GI. BOE Picerssnseceszenssnsnsncsemicsnvarecens 4
F. Hoffman-La Roche Ltd. v. Empagran S.A.,

ele Se ee ihiiintidrcctaanniaecentealiaiianinde 12, 13
Hilton v. Guyot,

Fe Gh BR Cer E ceitcetctescceencnianctvansenonsvalats 10, 11
Pakootas v. Teck Cominco Metals, Ltd.,

452.F.3d 1066 (Sth Cir. 2006)..............-cescescesees passim
Societe Nationale Industrielle Aerospatiale v.

United States District Court,

he Ree ,2 : SRRRRRROEE ERE terrence acento 10

UNITED STATES STATUTES

The Comprehensive Environmental Response,
Compensation, and Liability Act,
A else PR i tcsactnlanessteer tctaekelacakesencnsupsncanesions |

ill

Page(s)
CANADIAN CASES

Amchem Prods. Inc. v. British Columbi. Workers’

Comp. Bd.,

Be Ns FINE scessentcsicknsebenicsicerceacbosideetes 11
De Savoye v. Morguard Investments Ltd.,

DA. BOTT COR, TOR rrccencscevcsvevercesecvsscetsies 10-11
Pro Swing Inc. v. Elta Golf Inc.,

2006 A.C.W.S.J. 157 (Can. 2006) «00... eeeeeees il
Spar Aerospace Ltd. v. Am. Mobile Satellite Corp.,

GA Be CR BED oviesecsecrtcstovseresvinserivcaceis 10, 11

TREATIES

Agreement on Air Quality, Mar. 13, 1991, U.S.-Can.,
pp ty: 2, fs ae REE DID 9

Agreement Concerning the Transboundary
Movement of Hazardous Waste, Oct. 28, 1986,
U.S.-Can., T.LA.S. No. 11,099, CTS 1986/39.....0000002. 8

Agreement on Great Lakes Water Quality, Apr. 15,
1972, U.S.-Can., 23 U.S.T. 301, CTS 1972/12............... 8

Convention for the Protection of Migratory Birds,
Aug. 16, 1916, U.S.-Gr. Brit. (for Canada), 39
NF See I icetics ves setter aipenndictin tasnneun need dbrinsipmnes 9

IV
Page(s)

Memorandum of Agreement on Shellfish Sanitation,
Mar. 4, 1948, U.S.-Can., T.1.A.S. No. 1747, CTS
Se iyhiciy ncsssbasivcabdaha phase cnanapeaabaanibeianbabiadebiinias 9

Treaty Relating to Boundary Waters Between the
United States and Canada, Jan. 11, 1909, U.S.-
Gr. Eit., 36 Slat. ZO6E; CUS SIZ vvcesisccssensescrscoses 2-3, 7,9

Treaty Relating to Cooperative Development of the
Water Resources of the Columbia River Basin,
Jan. 17, 1961, U.S.-CAN., 15 U.S.T. 1555, CTS
PO heh criin sacceirsaiticideiies epltbeccintidini ith taseatenuaschlabiealocsniadl 8

MISCELLANEOUS

EDWIN M. BORCHARD, THE DIPLOMATIC PROTECTION OF
CATLIN FOI CFE icscecotnncvcsisicesioncetscrsccepnesconiors 14

Canada-United States Joint Inland Pollution Contingency
Fe, FUE Bs FF CN coc ciotbcstctnehcnsinivrntianccsons 8-9

Austen L. Parrish, Trail Smelter Deja Vu: Extraterritoriality,
International Environmental Law, and the Search for
Solutions to Canadian-U.S. Transboundary Water
Pollution Disputes, 85 B.U. L. REV. 363 (2005)......... 7-8

RESTATEMENT (THIRD) OF FOREIGN RELATIONS
LAW OF THE UNITED STATES (1987)................000 12, 13

Tratl Smelter Arbitration, (U.S. v. Can.),
3 R.L.A.A. 1905 (1938-1941),
reprinted in 35 Am. J. Int'l L. 684 (1941)... 7

IN THE

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

This Brief amicus curiae,' submitted in support of Petitioner
Teck Cominco Metals, Ltd. (“Petitioner”) with the written
consent of both Petitioner and Respondents Pakootas, Michel
and the State of Washington, addresses the first question
presented by Petitioner.2 Canada views the Ninth Circuit’s
holding that the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA), 42 U.S.C.
§ 9607, can be applied and enforced unilaterally to extend
liability to a Canadian company for the ultimate

1 No counsel for a party authored this Brief in whole or in part. No
person other than the amicus curiae made a monetary contribution to the
preparation or submission of this Brief.

2 The second question raised in the Petition for Certiorari appears to
present purely a matter of United States law, which Canada believes to be
more appropriately for the parties to address.

2

consequences of its actions in Canada as failing to consider
three relevant and important international law issues: long-
standing diplomatic practice and treaties between Canada
and the United States, comity of nations and the related
international law norm of national treatment. Because
Canada believes its views on a matter of significant concern
to the Government of Canada and its citizens would
materially assist this Court in deciding the Petition, Canada
respectfully submits this Brief, addressing these issues and
their application to this and similar cases.

THE INTEREST OF AMICUS CURIAE
THE GOVERNMENT OF CANADA

Canada is the sovereign state in which Petitioner is
domiciled and which, together with the province of British
Columbia, is responsible for regulating the conduct of
Petitioner. Canada therefore has an interest in ensuring that
the present dispute is dealt with through a process consistent
with the established approach to Canadian-U.S.
transboundary environmental concerns, which have long
been addressed through bilateral cooperation. As sovereign,
Canada also has a strong interest in seeing that principles of
international law and comity are respected in the resolution
of transboundary disputes.

Specifically, the Canadian Government has a
compelling interest in preserving the viability of diplomatic
mechanisms for resolving disputes with the United States
that implicate boundary issues. These mechanisms include a
valid treaty to which Canada and the United States are
parties and other internationally recognized procedures
available to both countries. In this case, where there are
well-established diplomatic procedures and precedents for
resolving issues of transboundary water pollution, including
through bilateral negotiations or pursuant to the Treaty

Reiating to Boundary Waters Between the United States and
Canada, Jan. 11, 1909, U.S.-Gr. Brit., 36 Stat. 2448, CUS
312 (the “Boundary Waters Treaty”), the issue raised by the
Petition presents a matter of recurring and_ special
importance to the Government of Canada.°

Regardless of the particular method of non-judicial
resolution, Canada has a vital sovereign interest in having
this dispute settled through diplomatic measures, rather than
by unilateral adjudication in the domestic courts of the
United States.4 The Government of Canada also has a strong

3 As noted in the Petition for Certiorari, in June 2006, Petitioner and the
United States Environmental Protection Agency (“EPA”) reached a
settlement outside the framework of CERCLA. Petition for Certiorari at
5. The settlement, which was the culmination of years of concerted
diplomatic efforts by Canada and the United States, resulted in EPA’s
withdrawal of its Unilateral Administrative Order against Petitioner (the
“UAO”) and the agreement that an affiliate of Petitioner based in the
United States would conduct a comprehensive study of the
environmental effects of the pollutants discharged from the Canadian
smelter at issue in this case. App. to Pet. Cert. 120a. Despite the extra-
judicial resolution of the dispute between EPA and Petitioner, outside the
context of CERCLA, plaintiffs in this case continue to seek injunctive
relief to enforce the UAO against Petitioner and compelling Petitioner to
take actions to correct its alleged violations of the UAO and CERCLA.
Id. at 118a-119a. See Pakootas v. Teck Cominco Metals, Ltd., 452 F.3d
1066, 1071 n.t0 (9th Cir. 2006). Plaintiffs also seek a declaratory
judgment that Petitioner has violated and continues to violate CERCLA,
civil penalties “to the maximum extent permitted by CERCLA” for each
day that Petitioner allegedly violated the UAO and attorneys’ fees. App.
to Pet. Cert. 118a-119a; see Pakootas, 452 F.3d at 1071 n.10. Canada
continues to have an interest in the bilateral resolution of these
outstanding disputes in accordance with established diplomatic practices
of Canada and the United States in these particular circumstances.

4 Notwithstanding Canada’s strong interest in a bilateral, diplomatic
resolution of this dispute, rather than a unilateral adjudication by private
parties in a United States court, the Government of Canada does not
condone — indeed it disagrees with — Petitioner’s assertions that the Ninth
Circuit’s decision “could provoke retaliatory actions against American
interests by Canada or her courts,” or affect Canada’s policy regarding its

4

interest in preserving its sovereign right to regulate Canadian
persons and companies operating in Canada, without
interference from private lawsuits in U.S. courts.

Canada confines itself to arguments based in
international law and does not address United States law,
except where helpful to elucidate international law
principles.

SUMMARY OF ARGUMENT

The Ninth Circuit erred in failing to consider the
existing framework for diplomatic resolution of the issues
raised by the private plaintiffs in this suit, as well as
fundamental principles of comity and _ customary
international law respecting non-interference by one
sovereign with the internal affairs of another sovereign, and
equitable principles of equal treatment of nationals and non-
residents. The court of appeals refused to consicer these
important legal norms even though it admitted that ‘neither
a logician nor a grammarian will find comfort in the world of
CERCLA,’” Pakootas, 452 F.3d at 1079-80 (quoting Carson
Harbor Vill., Ltd. v. Unocal Corp., 270 F.3d 863, 883 (9th
Cir. 2001)), and that certain provisions of the statute contain
language that “is by no means clear” — which, indeed, “does
not make literal or grammatical sense as written.” /d. at
1080. Thus, the Court of Appeals held that CERCLA
applied in this case to a Canadian company that conducts all
of its operations in Canada, even thought it acknowledged
that the text of the statute “does not indicate whether foreign
corporations are covered,” indeed, that “CERCLA is silent

military presence in Afghanistan, which were made without the
knowledge or sanction of the Government of Canada and reflect a
complete misunderstanding of Canadian governmental policy and
process. Petition for Certiorari, at 21, 22.

about who is covered by the Act.” Jd. at 1076, 1077
(emphasis in original). The Ninth Circuit admittedly broke
new ground regarding the applicability of CERCLA without
once giving weight, or even thought, to precedent for
deciding similar disputes diplomatically or to principles of
comity and customary international law.

Given the facts, and the novelty of the legal issues
raised by this case and the Ninth Circuit’s decision, Canada’s
preferred approach is to have the present transboundary
environmental dispute resolved completely and _ finally
through established diplomatic channels, not through a
private lawsuit in the courts of the United States. The United
States likewise has determined not to proceed by litigation;
EPA and Petitioner have reached an extra-judicial resolution
of the dispute, outside the framework of CERCLA. See
supra note 3; Petition for Certiorart, at 5.

A government-to-government resolution of the
pending disputes, as proposed by Canada in this Brief and in
its prior amicus curiae submission to the Ninth Circuit, has
the advantage of promoting comity by enabling a balance to
be achieved between, on the one hand, Canada’s interests in
maintaining water quality in Canada and preserving its
sovereign right to regulate Petitioner’s operations in Canada,
and, on the other hand, the United States’s interest in water
quality within its own sovereign territory. Government-to-
government resolution would also help to ensure avoidance
of future conflicts and inconsistencies in the application of
the two countries’ laws by substituting cooperation for
unilateral action. A cooperative approach will also have the
benefit of giving companies operating on both sides of the
border confidence that they will not be risking liability under
the unfamiliar laws of the neighboring country. The result of
the Ninth Circuit’s decision interpreting CERCLA in such a
way that the statute can be pronounced to be non-
extraterritorial is that companies located along the border

6

remain vulnerable to the risks and burdens of both
sovereigns’ regulations, which may be in conflict.

Canada recognizes the possibility that some cases
involving transboundary pollution may appropriately be
resolved in the domestic courts of Canada or the United
States. This is not such a case, however, as the settlement
between Petitioner and EPA emphasizes. See supra note 3;
Petition for Certiorari, at 5. Resolution through private
litigation is both unnecessary and, in this case, incompatible
with the basic principle of comity of nations, as recognized
and applied by Canadian and United States courts for
centuries.

Leaving complete resolution of the underlying
transborder issues to diplomatic or treaty mechanisms would
have the additional benefit of furthering comity by avoiding
application of CERCLA to Petitioner in circumstances that
offend the international law norm of national treatment.

Accordingly, this Court should grant the Petition for
a Writ of Certtorari and reverse the decision of the Ninth
Circuit, so that the issues in this case can be resolved
completely and finally between the two affected sovereigns,
or at least, be resolved in a way consistent with international
legal norms and considerations of comity.

ARGUMENT

THE COURT OF APPEALS ERRED IN FAILING TO
RECOGNIZE THAT TRANSBOUNDARY
ENVIRONMENTAL ISSUES SHOULD BE

RESOLVED THROUGH STATE-TO-STATE
BILATERAL COOPERATION AND NOT
THROUGH PRIVATE LITIGATION.

Traditicnally, Canada and the United States have
worked cooperatively to solve transboundary environmental
issues through bilateral negotiations or pursuant to the
Boundary Waters Treaty, which plainly applies in this case.9
The Treaty created the International Joint Commission (the
“1JC”’), which has had a long, successful history of operation.
See, e.g., Trail Smelter Arbitration, (U.S. v. Can.), 3 R.L.A.A.
1905 (1938-1941), reprinted in 35 Am. J. Int'l L. 684
(1941).6

5 Article LX of the Boundary Waters Treaty provides that Canada and
the United States “agree that . . . matters of difference arising between
them involving the rights, obligations, or interests of either in relation to
the other or to the inhabitants of the other, along the common frontier
between the United States and the Dominion of Canada, shall be referred
from time to time to the International Joint Commission for examination
and report, whenever either the Government of the United States or the
Government of the Dominion of Canada shall request that such questions
or matters of difference be so referred.” Boundary Waters Treaty, art.
IX, Jan. 11, 1909, U.S.-Gr. Brit., 36 Stat. 2448, CUS 312 (emphasis
added). It is common practice for the countries to submit a joint
reference to the International Joint Commission to encourage acceptance
by both parties of the Commission’s recommendations.

6 The Trail Smelter Arbitration, in which the JC managed an air
pollution dispute between Canada and the United States, is widely
regarded as a highly successful, seminal decision in international law.
See Austen L. Parrish, Trail Smelter Deja Vu: Extraterritoriality,

8

The Ninth Circuit gave a nod to the past success of
extra-judicial resolution of transboundary environmental
disputes concerning air pollution between Canada and the
United States, through arbitration, with respect to the
specific source of pollution complained of in this case — the
Trail Smelter located and operating in Trail, British
Columbia. See Pakootas, 452 F.3d at 1069 n.5. The Ninth
Circuit nevertheless rejected Canada’s suggestion (in a brief
amicus curiae) that a diplomatic, non-judicial resolution
should be pursued in this case, rather than extending the
reach of CERCLA. In doing so, the court not only ignored
the fact that the IJC was created for the specific purpose of
resolving disputes such as the one underlying this case, but
also that the JC has, over time, maintained consistent
credibility with Canada and the United States. See, e.g.,
Parrish, supra, at 417-18 & n.289.7

Indeed, the longstanding practice of the two countries
has been to deal through diplomatic means’ with
environmental issues of mutual concern. The ongoing
Canadian-United States cooperation regarding environmental
issues is evidenced by the 1972 Agreement on Great Lakes
Water Quality, Apr. 15, 1972, U.S.-Can., 23 U.S.T. 301,
CTS 1972/12. Canada and the United States have also
entered into the Agreement Concerning the Transboundary
Movement of Hazardous Waste, Oct. 28, 1986, Can.-U:S.,
T.LA.S. No. 11,099, CTS 1986/39, and the Canada-United

International Environmental Law, and the Search for Solutions to
Canadian-U.S. Transboundary Water Pollution Disputes, 85 B.U. L.
Rev. 363, 420 & n.306 (2005) (quoting Alfred Rubin as stating that
“{e]very discussion of the general international law relating to pollution
starts, and must end, with a mention of the Trail Smelter Arbitration’).

7 Canada and the United States have also entered into a Treaty Relating
to Cooperative Development of the Water Resources of the Columbia
River Basin, Jan. 17, 1961, U.S.-Can., 15 U.S.T. 1555, CTS 1964/2,
Article XVI of which provides for resolution of disputes by reference by
either sovereign to the JC.

9

States Joint Inland Pollution Contingency Plan, July 25,
1994, U.S.-Can.,8 to address spills and other environmental
emergencies along the Canada-United States border. Canada
and the United States each implemented the Convention for
the Protection of Migratory Birds, Aug. 16, 1916, U.S.-Gr.
Brit. (for Canada), 39 Stat. 1702, CUS 465, and the
Agreement on Air Quality, Mar. 13, 1991, U.S.-Can., 30
I.L.M. 676, CTS 1991/3.9 Both countries are also parties to
the Memorandum of Agreement on Shellfish Sanitation,
Mar. 4, 1948, U.S.-Can., T.1.A.S. No. 1747, CTS 1948/10.

These treaties, and a long history of bilateral
cooperation, underscore the unique potency of non-judicial
resolution of the issues before this Court. Moreover, the
Boundary Waters Treaty directly addresses the issues raised
by plaintiffs in this case. As noted previously, Article IX of
the Treaty provides that “whenever” either sovereign
requests that “questions or matters of difference” regarding
their common boundary be referred to the IC for
examination and report, such questions or matters “shall be
[so] referred.” Boundary Waters Treaty, art. IX, Jan. 11,
1909, U.S.-Gr. Brit., 36 Stat. 2448, CUS 312. In the spirit of
bilateral cooperation, all references to date have been joint.

In these circumstances, the Ninth Circuit’s ruling that
this case may proceed under CERCLA, in United States
courts, in derogation of the procedures that both Canada and
the United States have endorsed in the past, and which
Canada proposed in this instance, clearly disregarded the
fundamental rules of comity.

8 Available at http://yosemite.epa.gov/oswer/ceppoweb.nsf/vw
ResourcesByFilename/jcpcan.pdf/$File/jcpcan.pdf (fast visited April 30,
2007).

9 Since its creation, the UC’s jurisdiction has included air emissions,
which can also have a damaging effect on boundary and transboundary
waters. The Agreement on Air Quality has enabled action on acid-rain
causing emissions by both countries and on ground level ozone (smog).

10

II.

THE COURT OF APPEALS ERRED BY PRESUMING
THE APPLICATION OF CERCLA WITHOUT
CONSIDERING THE PRINCIPLE OF COMITY OF
NATIONS.

A. The Principle of Comity of Nations.

The United States Supreme Court has acknowledged
the importance of comity of nations since the earliest days of
its jurisprudence. The formulation of comity that is perhaps
most pertinent in this case is that articulated by the Court in
Societe Nationale Industrielle Aerospatiale v. United States
District Court, 482 U.S. 522, 544 n.27 (1987), describing
comity as “the spirit of cooperation in which a domestic
tribunal approaches the resolution of cases touching the laws
and interests of other sovereign states.” While comity ts not
“a matter of absolute obligation” that courts must always
follow, it is equally not a matter “of mere courtesy and good
will.” Hilton v. Guyot, 159 U.S. 113, 163-64 (1895). It is,
rather, “the recognition which one nation allows within its
territory to the legislative, executive or judicial acts of
another nation.” /d.

Principles of comity are also firmly established in
Canadian jurisprudence. Indeed, as the Supreme Court of
Canada has observed, “[t]he notion of comity has retained its
vitality in the jurisprudence of Canadian courts.” Spar
Aerospace Ltd. v. Am. Mobile Satellite Corp., 4 S.C.R. 205,
219 (Can. 2002).

The Supreme Court of Canada has repeatedly defined
comity in terms that echo decisions of this Court. In De
Savoye v. Morguard Investments Ltd., 3 S.C.R. 1077, 1096
(Can. 1990), the Supreme Court recognized that “‘[c]omity’

y

1]

in the legal sense, is neither a matter of absolute obligation,
on the one hand, nor of mere courtesy and good will, upon
the other.” Jd. Rather, because it is founded on “the
recognition which one nation allows within its territory to the
legislative, executive or judicial acts of another nation,
having due regard both to international duty and
convenience, and to the rights of its own citizens or of other
persons who are under the protection of its laws,” comity
cannot legally be disregarded. /d. (citing Hilton, 159 U.S. at
163-64). See also Pro Swing Inc. v. Elta Golf Inc., 2006
A.C.W.S.J. 157, at **26 (Can. 2006) (invoking the definition
of comity developed by the United States Supreme Court in
Hilton, 159 U.S. at 163-64); Spar Aerospace, 4S.C.R. at 219
(same).

As the Supreme Court of Canada explained in
Morguard, 3 S.C.R. at 1097, “[t]he ultimate justification for
according some degree of recognition” to the laws of other
nations “is that if in our highly complex and interrelated
world each community exhausted every possibility of
insisting on its parochial interests, injustice would result and
the normal patterns of life would be disrupted.” (Internal
citations omitted). See also Amchem Prods. Inc. v. British
Columbia Workers’ Comp. Bd., | S.C.R. 897, 913-14 (Can.
1993).

B. The Ninth Circuit Ignored Comity In
Concluding That CERCLA Could Be Applied
to Petitioner In This Case.

The Ninth Circuit’s disregard of these well-
established principles was particularly improper in this case.
The court of appeals expressly acknowledged that the text of
CERCLA is far from clear, in noting specifically that the
statute lacks any indication that Congress intended it to be
applied to foreign corporations. Pakootas, 452 F.3d at 1076,

12

1077, 1079-80. For that reason, the court chose to interpret
CERCLA in a manner that ostensibly made its application
non-extraterritorial.

Regardless of its nomenclature, the Ninth Circuit’s
decision nevertheless subjects Canadian companies, such as
Petitioner, to conflicting regulatory schemes and infringes
Canada’s strong sovereign interest in regulating its own
corporate citizens. Yet, it is well settled that “this Court
ordinarily construes ambiguous statutes to avoid
unreasonable interference with the sovereign authority of
other nations.” F. Hoffman-La Roche Ltd. v. Empagran S.A.,
542 U.S. 155, 164 (2004).

Indeed, it is a well-established tenet of comity that
where “one construction of a United States statute would
bring it in conflict with the law of another state that has a
clearly greater interest, . . or would subject a person to
conflicting commands, . . . while another construction would
avoid such a conflict, the latter construction is clearly
preferred, if fairly possible.” RESTATEMENT (THIRD) OF
FOREIGN RELATIONS LAW OF THE UNITED STATES § 403 cmt.
g (1987) (hereinafter “RESTATEMENT”’). As this Court has
explained,

This rule of statutory construction cautions
courts to assume that legislators take
account of the legitimate sovereign interests
of other nations when they write American
laws. It thereby helps the potentially
conflicting laws of different nations work
together in harmony-a harmony particularly
needed in today’s highly interdependent
commervial world.

Empagran, 542 US. at 164-65.
Even if the application of CERCLA in this case was

not “extraterritorial,” there can be no question that its
extension to Petitioner amounts to the application of a U.S.

13

regulation to a foreign entity domiciled and operating
exclusively in a foreign jurisdiction. Yet, the Ninth Circuit
did not even acknowledge, let alone analyze, the relevant
factors for determining whether a state may reasonably
prescribe laws with respect “to a person or activity having
connections with another state,” such as Petitioner in this
case. See RESTATEMENT § 403(1). Those factors include the
existence of justified expectations that might be protected or
hurt by the regulation, the extent to which the regulation is
consistent with the traditions of the international system, the
extent to which another state may have an interest in
regulating the activity and the likelihood of conflict with
regulation by another state. /d. § 403(2).

In this case, where the Ninth Circuit expressly found
that the statute was unclear and did not evince any
congressional intent to extend it to foreign corporations, the
court’s disregard of these fundamental principles of comity
was improper, for had it “take[n] account of the legitimate
sovereign interests” of Canada, as it ought, it may well have
reached a different result. Empagran, 542 US. at 164.

C. Principles of Comity Are Violated By the
Ninth Circuit’s Holding That CERCLA Could
Be Applied To Foreign Companies Operating
Solely Outside the United States.

The Ninth Circuit’s decision offends comity for the
additional reason that, as discussed in Petitioner’s opening
brief to the Ninth Circuit, CERCLA’s provisions pertaining
to “federally permitted releases” allow United States
companies charged with violations of CERCLA to rely on
United States environmental permits as exemptions to
liability under CERCLA, but = such permits and
corresponding exemptions are not available to non-residents

14

such as Petitioner. Nor do Canadian environmental permits
provide any basis for an exemption from CERCLA liability.

The application of CERCLA to Teck Cominco is thus
inequitable and also inconsistent with the international law
principle of national treatment. See EDWIN M. BORCHARD,
THE DIPLOMATIC PROTECTION OF CITIZENS ABROAD 101
(1915) (Foreign governments’ willingness to permit local
courts in other states to exercise jurisdiction over their
citizens is predicated, inter alia, upon “[t]he existence of
regular courts and of laws assuring to the alien the
administration of civilized justice, on terms of equality with
nationals.”).

This inequitable treatment of Canadian companies
may be exacerbated by CERCLA’s adoption of the principle
of jotnt and several liability; United States entities
contributing to pollution at a site may be able to assert a
“federally permitted release” exemption not available to a
non-resident, leaving the foreign entity to face sole or
disproportionate liability despite others’ contributions to the
pollution. Such an application of CERCLA would also harm
Canada’s interests by discouraging Canadian businesses
from engaging in economic activity where that activity is
located close to the border, regardless of their compliance
with Canadian environmental law. Given the industrial
presence on both sides of the border, the Ninth Circuit’s
approach would represent a radical shift in the pattern of
reasonable accommodation by each country for the other’s
industries operating in proximity to the border.

CONCLUSION

In this case, the Ninth Circuit construed an
admittedly ambiguous statute that is “silent about who is
covered by the Act” to apply to a Canadian corporation

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based on the eventual coming to rest in the United States of
by-products of that corporation’s operations in Canada. In
finding that, notwithstanding the statute’s silence, CERCLA
can be applied to and enforced against Petitioner in this case,
the court ignored the established practice of Canada and the
United States of resolving transboundary environmental
disputes such as the one presented here through established
diplomatic channels. The court also improperly eschewed
any consideration of the principles of comity of nations and
customary international law, including rules respecting non-
interference with the internal affairs of another sovereign,
and equitable principles of equal treatment of nationals and
non-residents.

Although it may be appropriate in some
circumstances to address transboundary pollution through
litigation in the domestic courts of Canada or the United
States, unilateral adjudication is neither necessary nor
appropriate in this case. Indeed, although plaintiffs continue
to press their private claims against Petitioner, EPA is no
longer seeking enforcement of its UAO against Petitioner,
having arrived at a settlement outside the context of
CERCLA and this lawsuit. This settlement emphasizes that,
in this case, allowing the underlying transborder issues to be
fully resolved through diplomatic or treaty mechanisms —
consistent with the past practice of Canada and the United
States — would also preserve comity between the two
countries and free both Canadian and U.S. companies with
border operations from risks of liability under the unfamiliar,
foreign laws of the neighboring country.

Accordingly, the Government of Canada respectfully
submits that the Petition for a Writ of Certiorari should be
granted and the decision of the Ninth Circuit should be
reversed so that the issues can be resolved completely and
finally between the two affected sovereigns, or, at least, be

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resolved in a way consistent with international legal norms
and considerations of comity.

Dated: Washington, D.C.

May 2, 2007
Respectfully submitted.

Dean Sherratt Margaret K. Pfeiffer

Of Counsel Counsel of Record
Department of Foreign Affairs Erin Chlopak
and International Trade SULLIVAN & CROMWELL LLP
Lester B. Pearson Building 1701 Pennsylvania Avenue, NW
Floor: C7 - Room: 266 Washington, DC 20006
125 Sussex Drive Telephone: (202) 956-7500
Ottawa, Ontario Canada Fax: (202) 293-6330

Telephone: (613) 992-6486
Fax: (613) 992-6483

Counsel for Amicus Curiae the Government of Canada

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_2229%3A12. Public record. Not legal advice.