For mer a ctingadministrator Stephen L . J ohnson was pre viously named a s the lead 1 defe ndant in this case. Pursuant to F eder al Rule of Civil P roce dure 25( d), the Court a uto matic a lly

su bs tit ute s h is s uc c e sso r, L isa

Jac ks on , a s th e ne w l e a d d e fe nd ant. EPA sty led its moti on as a motion for judg ment on the pleading s, or alter natively , a 2 motion for summary

judgme nt. The same le g al standar d applies for eac h kind of motion. S ee Gr e e nh ou se v. Gr e e n, 57 4 F . Su pp . 2 d 5 7, 63 -6 4 ( D. D. C. 2 00 8) . B e c a us e the re c or d in

thi s c a se contains mater ial from the pa rties' extensive discovery , the Court will treat EPA' s motion as one UNITED STAT ES DIS TRICT COURT F OR THE D ISTRIC T OF CO LU M BIA
GENERAL ELECTRIC COMP ANY P la in t if f, v. Ci vilAc ti on N o. 00 -2 85 5 ( JD B) LISA JACKSON, Adm inis trat or, United 1 States Environm ental P rote ction Agency, and t he UN ITED STA TES EN VI RO NM EN TA L P RO TEC TIO N AG ENCY Defendan t.
M EM OR AN DU M OP IN ION This case prese nts a broad c onstitut ional attack on a signific ant fe dera l environmental pr og ra m. P la int if

f G e ne ra l E le c tr ic Com

pa ny (" GE " or " pla int if f" ) c ha lle ng e s th e U. S. Environmental Protec tion Age ncy ' s (" EPA") administration of section 106 of the Comprehensive Environmental Response, Compensation, and L iability Act (" CERCL A" or " the Act" ), 42 U.S.C.§ 9601 et seq. GE conte nds that EPA's " pattern a nd prac tice" of administeringsection 106, 42 U.S.C. § 9606, viol ates the D ue Proce ss Clause of the F ifth Amendment. Am. Compl. at ¶ 1 . B e fo re the Court

a re the mot ion s f

or summa ry jud g me nt o f G E a

nd EPAand its administrator, L isa J ackson. For the re asons that follow, the Court re jects GE' s novel, but 2fo r s umm ary jud g me nt. Th e Court

se t f or th a mor e c omp re he ns ive dis c us sio n o f t he CER CLA f

ra me wo rk in i ts 3 previous opinions in this case. See G ener al Elec tric Co. v. Whit man, 257 F. Supp. 2d 8, 12-14 (D.D.C. 2003) ( Gene ral Elec tric I ); Gene ral Elec tric Co. v. J ohnson, 362 F. Supp. 2d 327, 330-31 (D.D.C. 2005) ( Gene ral Elec tric I I I ); see a lso Gener al Elec tric Co. v. EPA, 360 F.3d 188, 189-90 (D.C. Cir. 2004) (Ge nera l Electric I I ). -2- substantial, challeng e. On the r ecor d prese nted, the administrative or der r eg ime under se ction 10 6 o f C ERC L A, a s a dmi nis te re d b y EPA , d oe s n ot o ff

e nd du e pr oc e ss. BACK GR OUND I. The CERCLA F ram ework 3 CERCL A was e nacte d to ensure e fficie nt and expedient clea n-up of ha zardous waste sites resultingfrom industrial pollution. S ee K ey Tronic Corp. v. United States, 511 U .S. 809, 814 (1994); see also United States v. B estfoods, 524 U.S. 51, 55 (1998). Cong ress intende d the parties r esponsible for pollutinga site to clea n it up themselves, or at lea st to pay the costs of clea n-up. See Control Data Corp. v. S.C.S .C. Corp., 53 F.3d 930, 936 (8th Cir. 1995). Unde r CER CLA, on c e EPAide nti fi e s a ha zar do us sit e , it

se e ks to i de nti fy

" po te nti a lly

re sp on sib le parties" (" PRP s") . EPA may then initiate neg otiations with P RPs t o clea n up a site. See 42 U.S.C. § 9622. EPA has seve ral options if neg otiations fail. One option is to perform the c lean- up itself, pa yingfo r i t out of

the so -c a lle d " Sup e rf

un d" e sta bli sh e d b y

Con g re ss f

or thi s p ur po se . E PA would then bringan ac tion in federa l district court under se ction 107 of CERCL A to rec over clea n-up costs fr om responsible par ties. I d. §§ 9607(a) (4)( A), 9611(a ). Another option is t o seek an orde r fr om a fe dera l district court compellinga re sponsible party to clean up a

hazardous site. I d. § 9606(a) . EPA' s third option is to issue a " unilatera l administrative order " ( "UAO" ) under-3-

section 106, orde ringPRP s to clean up a site. I d. EPA may

issue a UAO upon a finding"that there may be an imminent and substantial enda ng erme nt to the public health or we lfare or the
env ir on men t b ecaus e of a n act ual or t hrea ten ed re lea se o f a ha z ardo us subs tan ce fro m a f aci li ty ." I d. EPA ' s p ra c tic e of

iss uin gUA Os un de r s e c tio n 1 06 is at th e he art of GE ' s d ue pr oc e ss challeng e in this case. Under CERCL A, a PRP that believes it is not responsible for the c lean- up fac es a c hoice whether or not to comply

with a UAO. I f the PRP complies, itmay seek r eimbursement f

rom other PRPs or from EPA itself upon completion of the cle an-up. I d. § 9606(b). I f the PRP does not comply , then EPA must file a civil ac tion in federa l district court to enfor ce the UAO. I d. § 9606(a) . The c ourt revie ws EPA' s remedy selec tion (i.e., its selection of a UAO) unde r the Administrative Procedur e Ac t's " arbitra ry and ca pricious" standard. See id. § 9606(b)(2) (D). The c ourt revie ws EPA' s selection of the responsible pa rty de novo. See K elley

v. EPA, 15 F.3d 1100, 1108 (D.C. Cir. 1994). EPA may seek two kinds of mone tary penalties if a

PRP does not comply

with a UAO. F ir st, if the no nc omp lyingPRP la c ks " su ff ic ie nt c a us e " and wi llf ull y vio late s th e or de r, the n E PA may seek $32,500 f

or ea ch day

of noncomplianc e. I d. § 9606(b). Sec ond, EPA may seek punit ive dama g e s u

p to thr e e tim e s " the amou nt o f a ny c os ts i nc ur

re d b y the [Sup e rf

un d] a s a result of such f

ailure to take proper

action." I d. § 9607(c) (3). B ut these pena lties are not automatic under

CERCL A. I f the re viewingcourt finds that the PRP had sufficie nt cause for noncompliance , then it cannot impose either form of pe nalty . I d. §§ 9606(b), 9607( c)( 3). Even absent a finding of suffic ient cause , moreove r, the c ourt has complete discretion as to the imposit ion and amount of a ny penalty . I d. § 9607(c) (3).-4-

II. P roce dural Hi story GE filed its Complaint on November 28, 2000, a nd amende d it on March 14, 2001. GE
c ha lle ng e s CE RCLA i n tw o w ay s. F ir st, GE a lle g e s th at th e te xt of CER CLA i tse lf

fa c ia lly violates the Due Process Clause. A m. Compl . at ¶¶ 21- 28, 50, 54. Second, GE a lleg es that E P A's "p at t ernan d

p ra ct i ce " o f a dm i n i s t er i n g th e U AO re gi m e u n d er s ec t i o n1 0 6 v i o l at es GE 's due proc ess rig hts. I d. at ¶¶ 17- 20, 51-52, 54. In Marc h 2001, EPA moved to dismis s GE' s Amended Complaint on jurisdictional g rounds. EPA argued that this Court lacked subjec t matter jurisdiction beca use sec tion 113(h) of CERCL A bar s judicial review of a se ction 106 order

until the clean- up is complete. This Court ag ree d and g rante d EPA' s motion t o dismiss . Gene ral Elec tric I , 257 F. Supp. 2d at 12. On appea l, however , the D.C. Circuit reve rsed a nd instructed this Court to consider the mer its of GE' s due proc ess cha lleng e on re mand. Gene ral Elec tric I I , 360 F.3d at 194. The cour t of appea ls ag ree d that section 113(h) bars r eview of "a s-applied, or

particula rized challeng es," but conclude d that section 113(h) does not bar " fac ial, or ' sy stemic' " c halleng es to CERCL A. I d. at 192. The c ourt of appe als relied pr imarily on two case s to reac h its holdi ng : J ohnson v. Rob iso n, 41 5 U .S. 36 1, 37 3- 74 (1 97 4) , a nd Mc Na ry v. Ha iti an Re fu g e e Ce nte r, Inc ., 49 8 U .S. 479, 492-94 (1991) . Robison was a fa cial constitutional challeng e to the Ve tera ns' Readjustment B e ne fi ts A c t, 3 8 U .S. C. § 21 1( a ). Se c tio n 2 11 of that A c t ba

rr e d r e vie w o f i nd ivi du a l be ne fi t deter minations, but t he Supreme Court held that section 211 did not ext end to fa cial
c on sti tut ion a l c ha lle ng e s to the sta tut e . Ro bis on , 4 15 U. S. at 36 7. Mc Na ry wa s a c ha lle ng e to the Immigration and Natura liz ation Service ' s "pattern and pr actice " of administeringthe Special Ag ricultural Worker s (SAW) provisions of the I mmigration Reform Control Act, 8 U.S.C. §-5-

1160. Section 210(e) of that Ac t barre d judicial revie w " of a de termination respe ctingan
a pp lic atio n" fo r S AW s tatus , b ut t he Sup re me Court

he ld t hat se c tio n 2 10 (e ) d id n ot a pp ly to

" g e ne ra l c oll ate ra l c ha lle ng e s to un c on sti tut ion a l pr a c tic e s a nd po lic ie s u se d b y

the a g e nc y

in proce ssing a

pplications." Mc Nar

y , 498 U.S. at 492. Be cause Robison and McNar y permitted fa ci al an d p at t ernan d

p ra ct i ce cl ai m s t o p ro ce edi nth e f ac e o f p ro v i s i o n s s i m i l ar

t o C E R C L A's
se c tio n 1 13 (h ), the D. C. C ir c uit ins tr uc te d th is C ourt

to c on sid e r G E' s d

ue pr oc e ss c ha lle ng e s to CERCL A on re mand. 360 F.3d at 194. InM ay 2 0 0 4 , E P A f

i l eda m o t i o nfo r s u m m ary j u d gm en t . E P A a rgu edth atGE 's challeng e wa s solely

a fa cial one a

nd that it had to be ana ly

zed under the Sale rno doctrine . See United States v. Salerno, 481 U.S. 739 (1987) . Under Salerno, a

plaintiff pursuinga fa cial
c ha lle ng e mus t e sta

bli shthat a

statut e is unc on sti tut ion a l in e ve ry a pp lic atio n. I d. at 74 5. EPA
ar gu edth at , atth e v ery

l ea s t , C E R C L A i s co n s t i tu t i o n al i nem er gen cy s i tu at i o n s an d

h en ce GE 's fac ial challeng e had to f

ail. This Court ag ree d and g rante d EPA' s motion for summary judgme nt
on GE's f aci al ( or t ex tu al) chal len ge to C ER CLA in M arch 20 05 . Ge nera l E lec tr ic I I I , 3 62 F. Supp. 2d at 330. Considering only the text of CER CL A, this Court held that section 106 does
no t de pr ive PRPs o f p ro pe rt y int e re sts wi tho ut a

su ff ic ie nt j ud ic ia l he ari ng . I d. at 33 8- 42 . N or is
se c tio n 1 06 a s w ri tte n s o c oe rc ive a s to de pr ive PRPs o f p ro c e dura l du e pr oc e ss u nd e r E x part e Youngand its prog eny . I d. at 342-43. This Court held that " [t ]he ability of the PRP to choose, under the languag e of the statute, whethe r to comply with a sec tion 106 order is key ." I d. at 339. By choosingnot to comply , a PRP receive s a pre -depr ivation hear ing in a fede ral district cour

t. That cour t also has the sole discr etion to impose penalties for nonc ompliance, ther eby rele asing any unconstitutional pressure that might otherw ise be inher ent in the statute. F inally , the Court-6-

he ld t hat be c a us e se c tio n 1 06 wo uld

be c on sti tut ion a l in

a tr ue e me rg e nc y

sit uatio n e ve n if

a PRP
we re d ep ri v edo f ap ro p erty i n t er es tb ef

o re an ad equ at e j u d i ci al h ea ri n g, GE 's fa ci al ch al l en ge failed unde r Salerno. I d. at 343-44. This Court disagr eed, how ever , that GE' s fac ial and " pattern a nd prac tice" claims wer e one and the same. See id. at 333-36. EPA ar g ued that whe n the cour t of appe als rema

nded the
case to this C ourt, it had held that only fac ial claims clea

red the section 113(h) jurisdictional hurdle. The ref

ore, EPA r easone d, only

GE' s fac ial challeng e wa s befor e this Court on remand. To be sure , th is C ourt

re c ognize d th at so me iso late d la ngua g e fr om t

he D. C. C ir c uit ' s o pin ion

did support EPA' s position. But the D.C. Circuit's opinion, rea d as a whole, firmly underc ut that po sit ion . T his Court

no te d th at th e c ourt

of a pp e a ls c le arl y

dis tin g uis he d b e tw e e n f

a c ia l, sy stemic, and pa

rticularized cha lleng es. I d. at 334 (c iting Ge nera l Electric I I , 360 F.3d at 192). Mo re ov e r, the c ourt

of a pp e a ls h e ld t

hat f a c ia l and sy ste mic c ha lle ng e s a

re tr e ate d s imi larl y

in
ana ly zingjur isd ic tio na l pr ov isi on s li ke se c tio n 1 13 (h ). Th e ratio na le , th e c ourt of a pp e a ls
rea soned, is that neither f acia l nor sy stemic cha lleng es impair the policy considerations underlying suc h jurisdictional bars. Ge nera l Electric I I , 360 F.3d at 194. Section 113(h), and provisions like it, are mea nt to ensure pr ompt responses to ag ency action and to avoid liti g ation until the responses ar e complete . Be cause neither f acia l nor sy stemic cha lleng es would dela y the clea n-up at a ny particula r site, they

are treated the same for pur poses of sec tion 113(h). I d. The Court found this key

point inescapa

ble g iven the ca ses that the cour t of appe als relied
u p o ni nr e a c h i n gi t s h o l d i n g . G e n e r a l E l e c tr i c III , 3 6 2 F
. S u p p . at3 3 5 ( c i t i n gG e n e r a l E l e c tr i c II, 360 F.3d at 192-93). F or example, the cour t of appe als relied in sig nificant pa rt on McNa

ry , a pattern a nd prac tice ca se cha lleng ing I NS's a dminist ration of c erta in immi g ration law pr ovisions.-7-

In McNa ry , the Supreme Court he ld that such a pattern and pr actice claim clea red a jurisdictional hurdle a nalog ous to section 113(h). See McNa ry , 498 U.S. at 492. Be cause the Supreme Court allowed suc h a cla im to procee d in McNar y , the cour

t of appe als rea soned, GE should be permitted to proce ed with its claim here as we ll. See Gene ral Elec tric I I , 360 F.3d at 193. Bound by the cour t of appe als' s decision to rema nd GE' s pattern a

nd prac tice cla im, this Court thus reje cted EPA' s argument that GE' s fac ial and patter n and pra ctice c halleng es we re e x actly the same. Ge nera l Electric I I I , 362 F. Supp. 2d at 334-36. A t the time of the Court' s decision, GE had not y et bee n able to deve lop the fac tual rec ord to support its claim that EPA's a dminist ration of se c tio n 1 06 de nie s PRPs pr oc e dura l du e pr oc e ss i n f a c t, e ve n if

the statut e do e s n ot d o s o in the or y . T he Court , th e re fo re , p e rm itt e d G E t o p ro c e e d w ithdis c ov e ry on tha t c la im. D i s c o v e r y l a s t e d o v e r tw o ye ar s , c l o s i n gi nA u g u s t2 0 0 7
. D ur i n gth e c o ur s e o f d i s c o v e r y, the Court issued ruling s on motions t o compel in September 2006 and F ebrua

ry 2007. See Gene ral Elec tric v. Johns on, No. Civ.A.00-2855, 2006 WL2616187 (D.D.C. Sept. 12, 2006) (Ge nera l Electric I

V); Ge nera l Electric v. Johnson, No. Civ.A.00-2855, 2007 WL 433095 (D.D.C. F eb. 5, 2007) ( Gene ral Elec tric V). T he par ties produce d tens of thousands of documents, conduc ted numerous f act a nd expert depositions, and exchang ed re ports and re buttal repor ts for six experts. GE Memora ndum in Support of its Motion for Summary J udg ment (" GE Mem." ) at 9-10. T he fa ctual re cord in this case is now, to put itbluntly , extensive. Be fore the Court at this tim e ar e the pa rties' cross-motions for summar y judgme nt based on that rec ord. The c rux of GE' s argument is that EPA's a dminist ration of se ction 106 violates the Due Proc ess Clause bec ause, a pplying the framework of Mathews v. Eldridg e, 424 U.S. 319 (1 97 6) , s e c tio n 1 06 a s a dmi nis te re d d e pr ive s PRPs of pr ote c te d li be rt

y and pr op e rt y int e re sts-8-

without a hear ing, a

nd beca use PRPs are forc ed to comply with UAOs, there by

offe nding E x parte Young , 209 U.S. 123 (1908). EPA counte rs that GE ha s not suffer ed the pr e-he aring deprivations italleg es and that such deprivations do not require g reater proc ess than EPA alre ady provides consistent with CERCL A. EPA furthe r ar g ues that an Article I I Icourt c onducts de novo revie w of pe nalties ava ilable for UAO noncomplianc e bef ore a ny penalties c an attac h, there by curingany

coer cive pr actice s alleg edly undertaken by

EPA. LEGAL STANDARD Summary jud g me nt i s p ro pe r whe n th e ple a din g s a nd e vid e nc e de mon str ate tha t " the re is
no g e nu ine iss ue a s to any mate ri a l f

a c t and that th e mov ingpa

rt y is e nti tle d to jud g me nt a s a matter of la

w." Fe d. R. Civ. P . 56(c) . The movingparty may succe ssfully

support its mot ion by "inf orming the district court of the basis of its motion, and identifying those portions of ' the pleading s, depositions, answers to interr og atories, a nd admissions on file, toge ther with the aff idavits, if any ,' which it believes de monstrate the a bsence of a g enuine issue of materia l fac t." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) ( quoting F ed. R. Civ. P. 56(c)). The court must reg ard the non-movant' s statements as true and ac cept a ll evidence and make all infere nces in the non-movant' s favor . See Ande rson v. L iberty L obby , Inc., 477 U.S. 242, 255 (1986). T he moving pa

rty may point to the absence of evide nce pr offe red by the non-movant to succ eed on summary judgme nt. See Celotex, 477 U.S . at 322. Where, a s here , the Court would be the trie r of fa ct if the c ase w ere to proce ed to trial, " the ' Court is not confined to decidingquestions of law, but a lso may

. . . d ra w a de ri vativ e inf

e re nc e fr om u

nd isp ute d s ub sid iary

fa c ts, e ve n if

tho se fac ts could support an infer ence to the contra ry , so long a s the infer ence does not depe nd upon an evaluation of witness cre dibilit y .' " O AO Alfa Ba nk v. Ctr. for Public Integ rity , 387 F. Supp. 2dDiscover y has closed in this ca se and the fac tual rec ord is complete. At the motions 4 he ari ngbe fo re thi s Co ur

t on Oc tob e r 1 4, 20 08 , c ouns e l f or GE and EPAre c og nize d th at so me "de tails" of the fac tual rec ord re main in dispute. See Tra nscript of Motions Hea

ring(" Tr." ) at 75-77, 89-91. B ut neither c ounsel maintained that these disputes would stand in the way of summary judgme nt. I ndeed, both c ounsel stated that the disputed fa cts are not material. Mo re ov e r, bo th c ouns e l r e c og nize d th at th e le g a l and fa c tua l is su e s in

thi s c a se are no t w e llsuited for re solution at trial. See Tr. at 75 ( "I ' m not sure the Court is ever g oing to have much more than it has r ight now." ); id. at 89-90 (" [W ]ell, i s there a need f or a f actua l trial here [? ] [ T]he nightmar e of c ontinuing this alrea dy long pr ocee ding muc h longe r, I think there is no nee d. . . .")
. -9- 20, 39 (D.D.C. 2005) ( quoting Cook v. B abbitt, 819 F. Supp. 1, 11 & n.11 ( D.D.C. 1993)); see also Ramallo v. Reno, 931 F. Supp. 884, 888 (D.D .C. 1996). 4 AN AL YSI S I. Appli cability of

Salerno. EPAargue s th at th e sta

nd ard fr om Unit e d St ate s v . Sa le rn o, 48 1 U .S. 73 9 ( 19 87 ), sh ou ld apply to GE' s pattern a

nd prac tice cla im. EPA Memorandum in Support of its Mot ion for S u m m ary J u d gm en t(" E P A M em . ") at1 7 -1 9
. Un d er S al ern o , a p l ai n t i ff

fa ci al l y ch al l en gi n g a statute' s constitutionalit y

must establish that the statute is unconstitut ional in ever y application. Salerno, 481 U.S. at 745. Notwithstandingsome debate within the Supreme Court on this "no se t of circ umstances" prongof Salerno, se e City of Chicag o v. Morales, 527 U .S. 41, 55 n.22 (1999), the D.C. Circuit continues to apply Salerno to fa cial cha lleng es base d on statutory text . See Nebr aska v. EPA, 331 F .3d 995, 998 (D.C. Cir. 2003); Chemical Waste Mg mt. v. EPA, 56 F.3d 14 34 , 1 43 7 ( D. C. C ir . 1 99 5) . Ind e e d th is C ourt did so e arl ie r o n G E' s te xtua l c ha lle ng e to C E R C L A. S ee Ge n er al E l ec tri c II I , 3 6 2 F. S u p p . 2 d at3 4 3 -4 4
. E P A a rgu es n o w t h atGE 's pattern a nd prac tice cla im is t antamount to a fa cial cha lleng e, and that the reme dy GE see ks throug h the pre sent claim -- a re medy "that would apply

universally

to EPA's c onduct" -- is no differ ent than the r emedy GE soug ht in the fac ial challeng e this Court considere d (and r ejec ted)T h e C o urtp re v i o u s l y i n d i ca t ed , b u td i d

n o t d ec i d e, th atS al ern o m i gh tn o tap p l y t o GE 's 5 pattern a nd prac tice cla im. See Gene ral Elec tric I I I , 362 F. Supp. 2d at 343 & n.9. -10- pr e vio us ly . E PA M e m. a t 17 . E PA a ssu

re s th is C ourt

tha t ot he r f e de ra l c ourt s a

pp ly Sa le rn o to sim ila r f a c ia l c ha lle ng e s to a g e nc y ru le s a nd po lic ie s. Th e re fo re , E PA a rgue s, Sa le rn o s ho uld
a pp ly to G E' s p atte rn

and pr a c tic e c la im j us t a s it

a pp lie d to GE ' s p re vio us ly -r e je c te d f a c ia l c la im based on the text of CERCL A. Th e Court

wi ll n ot a

pp ly the Sa le rn o s tand ard

to G E' s p atte rn

and pr a c tic e c la im. 5 Salerno a pplies to challeng es base d on hy pothetical applications of a statute, not to challeng es based on the particula

r fa cts of a c ase. See Salerno, 481 U.S. at 745 & n.3; Reno v. Flore s, 507 U.S. 292, 300-01 (1991) ( applying Sale rno bec ause pla intiffs did "not cha lleng e [an I NS regulation's] application in a pa rticular instanc e; [the regulation] had not y et bee n applied in a particula r instance -- be cause it was not y et in exis tence -- whe n [pl aintiffs' ] sui t was brought.")
. But GE' s challeng e her e does not hy pothesize how section 106 could be a pplied in the abstrac t. Rather, GE ' s pattern a

nd prac tice cla im is based on how EPA ac tually administers section 106. GE su pp or ts i ts c la im - - d

ra wn fr om a n e xten siv e re c or d a ft e r c on sid e ra ble dis c ov e ry

-- wi th evidenc e about its own experienc es and the experience s of other PRPs, including a r aft of deposition testimony , expert repor ts, and EPA manuals. GE' s claim is theref ore more analog ous to the McNa

ry line of ca ses, which involved a pattern a nd prac tice cla im based on I NS's a ctual
a dm i n i s tr at i o no f

th e S A W p r o v i s i o n s o f

th e Im m i g r at i o nR e f

o r mC o n tr o l A c t . S e e M c N ar y, 49 8 U .S. at 48 7- 90 . N o c ourt in t hat c a se -- be g inn ingwi th t he Di str ic t Co ur

t and e nd ingwi th the Supreme Court -- even c ited to Salerno. This is not the ty pe of g ener ally -discoura g ed fa cial
c h a l l e n g e t o th e t e x to f

a s t atu t e t o w h i c hS a l e r

n o i s g e n e r a l l y

a p p l i e d , s e e G e n e r a l E l e c tr i c III ,EPA does not argue that GE la cks standingto challeng e EPA' s pattern a nd prac tice of 6 issuing UAO s as unconstitutionally coer cive unde r Ex parte Young
. Th is s tand ingargume nt i s d ist inc t f ro m a dif fe re nt c ha lle ng e by

EPAto G E' s st and ingto 7 asser t a patter n and pra ctice c laim at all, which the Court pre viously reje cted. See Gene ral Electric I I I , 362 F. Supp. 2d at 336-37. -11- 362 F. Supp. 2d at 343 n.9, and he nce the Court will not apply Salerno to GE' s pattern a nd prac tice cla im, which has alre ady been distinguished from a pure f acia l challeng e. II. St andi ng EPA nextargues that GE lac ks standing to r aise injuries ba sed on noncomplianc e with a UA O. Se e EPARe ply

Me mor and

um i n Su pp or t of its Summary

Judg me nt M oti on

(" EPA 6 Rep." ) at 9-11. Standing"r equire s a plaintiff to demonstrate the now- familiar e lements of injury in fac t, causation, and redr essability ." L ance v. Coffman, 549 U.S. 437, 439 (2007) (citingLujan v. Def ender s of Wildl ife, 504 U.S. 555, 560-561 ( 1992)). He re, EPA f ocuses on injury

in fac t. EPA points out t hat GE ha s complied with ever y UAO it has be en issued but that GE
never theless conc entrates its Mathews v. Eldridg e ana ly sis, discussed infra at § I V, on deprivations trigg ere d by

noncompliance with a UAO. E PA argues that " [i ]f such injuries never
occur to GE bec ause G E neve r disobey s a UAO , then GE doe s not have standingto base a due proce ss challeng e upon them." EPA Rep. at 11. 7 The injuries re levant to standingare not, as EPA asser ts, injuries arising from an a ct of
no nc omp lia

nc e . T he thr

us t of GE ' s argume nt i s th at E PA' s a dmi nis tr atio n o f s e c tio n 1 06 so
ampl if ie s th e ri sk s and

c os ts o f n on c omp lia

nc e that no ratio na l PRP w ou ld c ho os e no t to c omp ly with a UAO. T he ar g ument thus responds to this Court's holding in Ge nera l Electric I I I , wher e the Court reje cted GE ' s tex tual challeng e to sec tion 106 in part beca use a PRP theoretica lly

canCourts do not assess the merits of a pla intiff' s claim when c onsideringstanding . See 8 Emerg ency

Coalition t o Def

end Educ . Trave l v. Dep' t of Tre asury , 545 F.3d 4, 10 ( D.C. Cir. 2008) (" In consideringstanding , we must assume the me rits in favor of the par ty invoking our jurisdiction."). The ref

ore, at this st ag e of the analy sis, the Court presumes that the de privations GE a sse rt s c an f

or m th e ba sis fo r a

du e pr oc e ss c la im.

-12- c h o o s e n o tt o c o m

p l y w i tha U A O
. 3 6 2 F
. S u

p p . 2 d at3 3 9
. If

a P R P c h o o s e s n o tt o c o mp l y, EPA cannot c ompel compliance without judicial intervention, so a PRP can a lway s obtain a pre
deprivation hearing . I d. The Court re cog nized, however , that if PRP s are "de prived of a ny me anin g fu l c ho ic e to r e fu se to c omp ly wi th [a UA O], tha

t mi g ht p os e a

dif fe re nt s itu atio n in
a sse ssi ngwh e the r a

de pr ivatio n o f p ro pe rt

y ha s o c c ur

re d. " I d. Re sp on din gto t he Court ' s c ave at, GE now points to noncompliance- based de privations -- like a PRP ' s decr ease d marke t value -- as evidenc e that PRPs are ef fec tively forc ed to comply

with UAOs. More over, e ven if PRPs are not forc ed to comply , GE uses nonc ompliance- based de privations as evide nce that PR Ps suffer pr ehear ing de privations once a UAO is issued, no matter what they choose to do. The injury

inquiry for standingis lim ited to whether GE has " set forth" sufficie nt "spe cific f

acts" to support its claim that EPA deprives GE of liber ty or prope rty

without due proce ss by

issuing UAO s to GE. See L ujan, 504 U.S. at 561 (e stablishing a pla intiff' s burden of establishing sta

nding at the summary

judgme nt stag e). EPA does not dispute GE' s showing that 8 EPAha s is su e d 6 8 U AO s to GE and tha t G E h a s c omp lie d w itha ll o f t he m. S e e EPA Me mor and

um i n O pp os iti on

to G E' s Summa

ry Judg me nt M oti on

(" EPAOp p. " ) at 20 . A nd EPA
conce des that " GE [can] establish injury for standingpurposes whe re it does c omply with a UAO and incur s response c osts." EPA Rep. at 11 ( emphasis in orig inal). Ther efor e, GE ha s standing to bring this pattern and pr actice claim and may rely on noncompliance -base d injuries to the
e xtent it us e s su c h in

jur ie s to e sta

bli shtha t PRPs are de pr ive d o f a

me anin g fu l c ho ic e no t to-13-

comply with a UAO or

that PRP s suffer

pre- hear ing de privations reg ardle ss of whethe r they
c o mp l y. III . Ex P ar te Yo ung GE' s first claim is that EPA's pattern and pr actice of administeringsection 106 violates proce dural due proce ss under Ex parte Young , 209 U.S. 123 (1908). Unde r Ex parte Youngand its pr og e ny , a

statut or y sc he me that im

po se s p e na lti e s o n th os e se e kin gjud ic ia l r e vie w i s un c on sti tut ion a l if

" the pe na lti e s f

or dis ob e die nc e are by

fi ne s so e no rm ou s . . . a s to int imi date th e com pan y

andit s o ffi cers fro m r eso rt in g to t he co urt s t o t estth e val id it y of t he l egis lat io n. " I d. at 14 7. Statut e s p re sc ri bin gsignif ic ant p e na lti e s f

or vio lator s a

re no t pe r s e un c on sti tut ion a l, howeve r. Rather , if a pa

rty challeng ing a

penalty or a statute in " g ood faith" may not be penalized, then the statute ma y be constitutional under Ex parte Young . See Reisman v. Caplin, 375 U.S. 440, 446-47 (1964). H ere , under se ction 106(b)( 1), a district c ourt must review a ny penalty EPA seeks for

noncompliance with a UAO. T he cour t may only impose penalties if a PRP has fa iled to comply "w ithout sufficient ca

use" ; moreover , even if

the cour t finds that the noncomplying PRP lacks " sufficie nt cause ," the court still has full discretion in decidingwhether to impose a civil penalty , or punitive damag es, and if so, in what amount. See 42 U.S.C. §§ 9601(b)( 1), 9607(c )(3) . Courts consideringEx parte Youngchalleng es to sections 106 and 107 have he ld that the sufficie nt cause defe nse oper ates a s a g ood faith saf e har bor, ade quately

curing any constitutional problems that steep CERCL A fines a nd penalties c ould otherwise c reate. See Em plo y e rs Ins . o f Wa

us a u v . B ro wn e r, 52 F .3 d 6 56 , 6 64 (7 th C ir . 1 99 5) ; So lid State Cir c uit s, Inc. v. EPA, 812 F .2d 383, 391 (8th Cir. 1987); Wagne r Seed Co. v. Da g g ett, 800 F.2d 310, 316 (2d Cir. 1986); United States v. Capital Tax Corp., Civ.A.No. 04-4138, 2007 WL488084 at *6In a footnote, G E cited to three case s for the pr oposition t hat a statute ma y run af oul of 9 E x p art e Y o un g ev en i f ap en al ty s ch em e i s n o tau t o m at i c o r s el f- ex ec u t i n g. S ee GE 's Memorandum in Opposition to EPA's Summary J udg ment Motion ("GE Opp." ) at 46 n.29 (c iting Chicag o, M. & St. P. Rwy . Co. v. Pol t, 232 U.S. 165, 167-68 (1914); Missouri Pac. Rwy . Co. v. Tucke r, 230 U.S. 340, 346-51 (1913) ; Missouri P ac. Rwy . Co. v. Nebra ska, 217 U.S. 196, 207- 08 (1910)) . But at the motions hearing , counsel for GE conc eded that none of these case s stand square ly for that pr oposition. S ee T r. at 48. G E c it e s to U n it e d

St ate s v . T an n e r

y , Ci v . A
. N o . 9 1
- 6 9 3 , 1 9 9 2 WL 1 4 5 8 8 0 2 (N
. D
. T e x. 10 D e c . 7 , 1 9 9 2 ) , an d

U n i t e d S t at e s v . L e C ar

r e a u x, C i v . A
. N o . 9 0
- 1 6 7 2 , 1 9 9 2 W L1 0 8 8 1 6 ( D
. N
. J. Fe b. 19, 1992), to support its argument that courts do not exercise the ir judg ment in awar ding p un i t i v e o r t re b l e d am age s . GE R ep . at3 2 -3 3 & n
. 3 4
. InT an n ery , th e c o urtn o t edi na o n e- p age opinion that the defe ndant had r epeatedly ref used to participate in proce eding s befor e the c ourt. -14- (N
. D. I l l
. Fe b
. 8 , 2 0 0 7 ). Ap p l yi n g th i s re as o n i n g i nGe n er al E l ec tri c II I , th i s C o urtre j ec t edGE 's fa ci al E x p art e Y o un g ch al l en ge b as edo nth e t ex to f C E R C L A's UA O p ro v i s i o n s , al th o u gh leavingroom for G E to further develop a

n Ex parte Youngchalleng e in its pattern and pr actice
case . See 362 F . Supp. 2d at 342-43. GE' s pattern a

nd prac tice cla im under Ex parte Youngfails for the same re asons pr e vio us ly

e xpla ine d. GE po int s to fo ur a sp e c ts o f E PA' s U AO po lic y that su pp os e dly int imi date PRPs i nto c omp lia

nc e : E PA s e e ks maximumpe na lti e s f or no nc omp lia

nc e ; E PA s e e ks mul tip le pe na lti e s f

or vio latio ns at a

sin g le UA O s ite ; E PA r e je c te d Just ic e De pa

rtme nt a dv ic e tha

t E PA sh ou ldim po se a c ap o n d ail y pen alt ies ; an d E P A l abel s n on com pl yin g PR P s as "recal cit rant ." B ut n o matte r what E PA a rgua bly do e s o r s e e ks , a

jud g e ult imate ly

de c ide s w hat, i f a

ny , p e na lty to i mpo se . Ind e e d, c ourt s r outin e ly e xer c ise the ir

dis c re tio n in

de te rm ini ngwh at ki nd s o f d a ily 9 or punitive pena lties to im pose for violations of section 106. See, e .g ., United States v. Capital Tax Corp., Ci v.A.No. 04-4138, 2007 WL2225900 at *13 (N.D . I ll. Aug. 1, 2007) (aw arding $750 daily

penalty and zero punitive dama g es); United States v. B arkma n, Civ.A.No. 96-6395, 1998 WL962018 at *18 (E.D. Pa. D ec. 17, 1998) (aw arding$100 daily penalty ). 10Indeed, the court noted that "e ven if the summar y judgme nt were not to be g rante d, the cour t would g rant de fault judg ment in favor of plaintiff as a

sanction . . . ." 1992 WL1458802 at *1. Simi larly , in L eCarr eaux, the court noted that beca use it had " rec eived no opposition," it adopte d the re commendation of a

Mag istrate Judge, who himself adopted the g overnme nt's pr oposed f i n d i n g s o f f a c tan d c o n c l u s i o n s o f

l awi nth e i r

e n t i r e ty. 1 9 9 2 W L1 0 8 8 1 6 at* 1
. U n s ur p r i s i n g l y, the g ov e rnme nt p ro po se d th e maximumdama g e s a llo we d und e r C ERC L A. To be sure , b oth c a se s r e pr e se nt i ns tanc e s o f c ourt s a do pti ngEPA ' s su g g e ste d tr e ble and punit ive dama g e s. B ut i n e a c h c a se , th e de fe nd ants e ith e r f a ile d to op po se EPA ' s r e qu e ste d d ama g e s o r a lto g e the r f a ile d to pa rt ic ipate in t

he e nf or c e me nt p ro c e e din g s. Th e se c a se s, the re fo re , a re un iqu e in b oth

the br e vit

y of their a naly sis and the lack of

eng ag ement display ed by the def endants, a nd do not repre sent g ener ally a fa ilure by

the cour ts to ex erc ise discre tion reg ardingthe impositi on of pena lties for se c tio n 1 06 vio latio ns . -15- Nor doe s EPA's pattern and pr actice reg ardingUAOs pre vent fe dera l courts from
e xer c isi ngthe ir

dis c re tio n. In G e ne ra l E le c tr ic I I I , th is C ourt a ff ir me d a s sa tis fy ingdu e pr oc e ss require ments CERC L A' s judicial review provisions, which provide f or de novo r eview of li abi li ty andrevi ew o f rem edy

sel ect io n u nd er an"arbi tr ary andcapr ici ou s" s tan dard . 3 62 F. Supp. 2d at 341-42. Now, GE a rgues that EPA' s pattern a nd prac tice of c ompiling the administrative re cord c reates an incomplete basis for a revie wingjudge ' s decision, there by impairing the judg e' s discretion. Specific ally , GE ar g ues that EPA' s prac tice of e x cluding irrele vant and pr e-de cisional deliberative documents fr om the administrative re cord r esults in a skewe d rec ord. See G E Mem. at 57. B ut irreleva nt documents should be excluded from the
re c or d - - t he re c or d s ho uld

on ly inc lud e do c ume nts tha

t th e a g e nc y

" dir e c tly or ind ir e c tly
c on sid e re d. " Se e Mari te l, I nc . v . Co lli ns , 4 22 F . Su

pp . 2 d 1 88 , 1 96 (D .D .C. 20 06 ); se e a lso J ames Madison Ltd. by

Hec ht v. Ludwig , 3 F.3d 1085, 1095 ( D.C. Cir. 1996). And " an ag ency g ener ally may exclude materia l that refle cts internal de liberations." Maritel, 422 F . Supp. 2d at 196. Moreove r, GE ha s not demonstrated that EPA ac tually has a pattern and pr actice of excluding docume nts that should be included in the re cord. A lthough GE has provided e x amplesGE' s citation to Pearson v. Shalala, 164 F .3d 650, 660 (D.C. Cir. 1999), in support of 11 this same point is unhelpful. Pearson consider ed an a g ency' s failure to articulate rea sons for takingaction, not an a g ency' s failure to give definitional content to an a nalog ous "sa fe ha

rbor" te rm . G E d oe s n ot a

rgue that E PA r outin e ly

fa ils to a rt ic ulate re a so ns fo r i ssu ingUA Os
. -16- from two sites wher e an a dminist rative r ecor d was a rguably incomplete, two ane cdotal examples do not form a pattern and pr actice . Cf. Coser v. Moore , 739 F.2d 746, 751- 52 (2d Cir. 1984); Int'l B hd. of Tea

msters v. United States, 431 U.S. 324, 336 (1977). And e ven if the r ecor d was incomplete in those two instance s, safe g uards within CERCL A ensure that a re viewingcourt could have supplemented the r ecor d. See 42 U.S.C. § 9613(j)(1) . The Court is not persuade d, th en , th atE P A ab u s es i t s s t ew ar d s h i p o f t h e a dm i n i s tra t i v e r ec o rdan d h en ce re j ec t s GE 's
asser tion that courts are preve nted from e x erc ising their disc retion in awa rdingor deny

ing pe na lti e s and

fi ne s. Finally , GE ar gues that EPA has purpose fully muddied the contours of

the suffic ient
c a us e de fe ns e , th

us ke e pin gPRPs gue ssi ngwh e the r t he y have su ff ic ie nt c a us e in d e c idi ngno t to comply with a UAO. T o be sure , Ex parte Youngproblems may arise when the imposition of penalties turns on the inter pretation of an imprec ise leg al standar d. See Solid St ate Circuits, 812 F .2 d at 39 1. GE c on te nd s th at So lid State Cir c uit s p ro vid e d a n " un ambi g uo us c a ll o n E PA t o pr ov ide the ty

pe of g uid anc e ne c e ssa

ry to p ro vid e the su ff

ic ie nt c a us e de fe ns e wi th .
. . re qu isi te
cer tainty ." G E Mem. at 55. GE ar g ues that EPA has ig nored this judicial command, c hoosing 11 instead to kee p the suffic ient cause defe nse vague. Solid St ate Circuits, howe ver, doe s not go a s fa r a s G E w ish e s. Th e re , th e Ei g hth Cir c uit re c og nize d th at be c a

us e CER CLA h a d o nly

re c e ntl y been e nacte d, the term " sufficie nt cause " ha d not y et bee n develope d by EPA or the cour

ts. 812 F.2d at 391. The cour

t noted that "a s the EPA and the c ourts fac e conc rete cost rec overy and-17-

tr e ble dama g e c a se s, se c tio n 1 07 (c )( 3) of CER CLA [i. e ., the su ff

ic ie nt c a us e de fe ns e ] wil l de ve lop a c c or din g ly ." I d. at 39 1 n .1 1. In th e me anti me , th e c ourt by pa sse d p ote nti a l E x part e Youngproblems by

shifting the bur den -- rathe r than re quiring the noncomplying PRP to show that it had sufficie nt cause not to comply , the cour t require d EPA to show that the challeng ing PRP lacke d sufficie nt cause . I d. at 392. Althoug h the cour t noted that EPA could have avoided thi s k ind of burd e n- sh if

tin gby e na c tin gde ta ile d r e g ulatio ns re g ard ingthe su ff ic ie nt c a us e defe nse, the c ourt did not issue the kind of "una mbiguous c all" that GE sug g ests. In the end, courts, not ag encie s, provide the c onclusive interpr etations of imprec ise leg al terms like "suf ficient c ause." See Mar

bury v. Madison, 1 Cranch 137, 177 ( 1803) (" I t is emphatically the pr ov inc e and

duty of the jud ic ia l de pa

rtme nt t o s ay

wh at th e law i s. " ). Ind e e d, sin c e Sol id S tate Ci r c u it s , d is tr ic t c o urts h av e g iv e nme an in gto th e te r m. Se e , e . g . , Ca

p it a l T a x Co r

p . , 2 0 0 7 WL 2225900 at *13; Ba

rkman, 1998 WL962018 at *17. Henc e, while EPA' s unwillingness to issue g uidance reg ardingthe meaningof suffic ient cause may be poor policy , it does not constitute a
coer cive pattern and pr actice . In sum, GE has not demonstrate d that EPA prac tices -- whether considere d individually

or tog ether

-- a re unc onstitut ionally

coer cive unde r Ex parte Young , and that due proc ess cha lleng e must acc ording ly fail. IV. Mathews v. Eld ridge That bring s us to the primary due proc ess cha lleng e GE a sserts, which must be a ssessed wi thi n th e fr ame wo rk

of Mathe ws v. El dr idg e . B oth EPAand GE pr op os e br oa d r

ule s f or c e rt a in
c ate g or ie s o f d e pr ivatio ns or g ov e rnme nt a c tio ns . B ut c ourt s a pp ro a c h d ue pr oc e ss c la ims wi th scalpe ls, not cleave rs. See Ha nnah v. L arc he, 363 U.S. 420, 442 (1960) ( "' Due pr ocess' is an
e lus ive c on c e pt. I ts e xac t bo un da ri e s are un de fi na

ble , a nd its c on te nt v ari e s a c c or din gto s pe c if ic-18-

fac tual contexts."). More over, the parties' proposed r ules are not adequately

supported by

the
c a se s th e y

c ite , a nd he nc e the Court

wi ll n ot a do pt t

he m. G E ar g u e s th atd

u e p r o c e s s r e qu i r e s a

tr i a l
- typ e h e ar i n gf

o r n o n - e m e r g e n c y,

" a dju dic ator

y " a g e nc y de c isi on s. GE Me m. at 10 ; G E Re ply Me mor and

um i n Su pp or t of its Summary J udg ment Motion ("GE Rep." ) at 23. GE insists that thi s Court held in Gener al Electric I V that issuance of a U AO is an a djudicatory decision. See 2006 WL2616187 at *15
n. 3. L e avin ga sid e wh e the r i ssu anc e of a UA O i s " a dju dic ator

y ," GE ' s a rgume nt f a ils be c a us e it is a leg al proposition without lega l support. Certainly , adjudicative de cisions require more individualiz ed proc ess than do rule -makingdecisions. See United States v. F la. East Coast Ry ., 410 U.S. 224, 244 (1973). And, to be sur e, some c ases c ontain dicta sug g esting that the more a n
a g e nc y ' s d e c isi on

re se mbl e s a

jud ic ia l de c isi on , th e mor e the a g e nc y ' s p ro c e dure s sh ou ld
re se mbl e jud ic ia l pr oc e dure s. Se e , e .g ., Ha nn ah, 36 3 U .S. at 44 2; L og an v . Z imm e rm an B ru sh Co., 455 U.S. 422, 433-34 (1982). B ut GE has not cited to any case s holding that trial- ty pe h ea ri n gs ar e r equ i re d

fo r a d j u d i ca t o ry

d ec i s i o n s , an d

th i s C o urtth er ef

o re wi l l n o tad o p tGE 's proposed r

ule. EPA , o n th e oth e r h and , a rgue s th at " c on se qu e nti a l" de pr ivatio ns c ann ot f or m th e ba sis for a due proc ess cha lleng e at a ll. EPA Opp. at 9-10. EPA points out that som e of the de pr ivatio ns GE a lle g e s o nly oc c ur be c a us e the mark e tpl a c e va lue s a PRP le ss a ft e r E PA i ssu e s a UAO to that PRP. I n support of its proposed rule , EPA relies on O' Ba nnon v. Town Court NursingCenter, 447 U.S. 773 (1980) , and B lum v. Yare tsky , 457 U.S. 991 (1982). O' Ba nnon reje cted a claim by nursinghome re sidents that they wer e entitled to a he aringbefor e the g ov e rnme nt d e c e rt if

ie d a nurs ingho me . O nc e the g ov e rnme nt d e c e rt if ie d th e ho me , r e sid e nts-19-

c ou ld n o lo ng e r u se the ir

g ov e rnme nt b e ne fi ts the re . T he Court re a so ne d th at th e re sid e nts did
n o th av e ad

u e p ro ce s s cl ai mb ec au s e t h ey we re o n l y

i n ci d en t al l y

af fe ct edb y th e go v ern m en t 's decision. 447 U.S. at 787. Unlike the inc identally -af fec ted re sidents in O'B annon, howe ver, UAOs a re issued dire ctly

to PR Ps, who are the mselves af fec ted by g overnme nt action. B lum reje cted the c laim of Medica id rec ipients that they wer e entitled to g reater proc ess bef ore astatesubsidiz ed hospital dischar g ed them. The Court rea soned that the re cipients did not have a due proce ss claim beca

use ac tions by

the hospital did not constitut e " state ac tion." 457 U.S. at 1004- 05. But UA Os are issued by EPA itself and indisputably constitute state ac tion. Hence , neither O' Ba nnon nor B lum is applicable her e. Connecticut v. Doe hr, 501 U.S. 1 (1991), on the other ha nd, does apply , and it require s this Court t o reje ct EPA' s argument. In Doehr , a statute provide d for e x parte prejudg ment attachme nt of rea l estate without notice to the a ffe cted pa rty . The Supreme Court noted that attachme nt "c louds tit le [and] i mpairs the ability to sell or otherwise a lienate the pr operty " a nd then held that these "c onsequenc es" wer e suff icient to merit due proc ess protec tion. I d. at 11-12. Do e hr the re fo re se ttl e s th e qu e sti on wh e the r c on se qu e nti a l in jur ie s ma y wa rr ant d ue pr oc e ss protec tion, even if c ourts must care fully assess whe ther a

ny particula r conse quential depr ivation is actionable. F ina lly , E PA a

rgue s th at me re " dim inutio n in va lue " do e s n ot g ive ri se to a du e pr oc e ss c la im. EPAMe m. a

t 24 -2 5. EPAc ite s o nly

to And ru s v . A lla

rd , 4 44 U. S. 5 1, 65 -6 6 ( 19 79 ), in support of this proposition. I n Andrus, the Supre me Court reje cted a taking s claim afte r the g ov e rnme nt b ann e d th e sa le of e a g le fe athe rs , r e a so nin gthat " los s o f f utu re pr of its
. . . p ro vid e s a slender r eed upon which to rest a takings c laim." I d. at 65 (e mphasis added) . But GE doe s not-20-

bringa taking s (i.e., just compensation) c laim; it brings a due proce ss claim. "' Property ' as used in th e J us t C ompen sat io n C lau se i s d efi nedmu ch m ore n arro wl y th an i n t he due p roce ss claus es. " Corn v. City

of L auder dale L akes, 95 F .3d 1066, 1075 (11th Cir. 1996). Andrus is there fore inapposite and the Court will not adopt this EPA proposal, either. Havingreje cted the pa

rties' proposed e asy

solutions, t he Court must apply the well-se ttled Mathews v. Eldridg e fr amewor k for due proce ss claims. Under Mathews, cour ts balance the private inter ests, the g overnme ntal interests, and the risk of er ror to dete rmine whe ther e x isting proce dures a

re a dequate to satisfy

constitutional due proce ss require ments. 424 U.S. at 335. Be fore rea chingthe balanc ing sta g e, howe ver, this Court must determine that issuance of a U AO deprive s PRP s of prope rty or liberty . See Amer ican Mfr s. Mut. I ns. Co. v. Sul livan, 526 U.S. 40, 59 (1999) ( "T he first inquiry in ever y due proc ess cha lleng e is whethe r the plaintiff ha s been deprive d of a pr otected inter est in ' proper ty ' or ' liberty .' ")
. PRP s arguably

suffe r depr ivations without adequate due proce ss under the se ction 106 UAO r eg ime in three w ay s. First, the mer e issuance of a U AO -- befor e the PRP decides whe ther to comply -- a rguably impacts the PRP's stock price and bra nd value. Sec ond, if a PRP chooses not to comply

with a UAO, the n the PRP arguably suffe rs incre ased da

mag e to its stock price a

nd brand va lue. Noncomplianc e also may impair a PRP's re lationships with reg ulatory personne l
and sta ke ho lde rs , p ote nti a lly

de pr ivi ngthe PRP o f a

lib e rt y int e re st. F ina lly , if

a PRP c ho os e s to
c omp ly wi th a UA O - - a

nd GE argue s h e re tha

t PRPs are fo rc e d to do so -- the n th e PRP mu st inc ur the c os ts o f c le an- up . T he pa rt ie s a g re e that c le an- up c os ts c on sti tut e a pr ote c te d p ro pe rt

yGE a lso argue s in its br ie fs that th e c os t of

sim ply re sp on din gto a

UA O d e pr ive s PRPs 12 of a pr otected inter est. See GE Me m. at 23-25. At the motions hear ing, how ever , counsel for GE conce ded that GE doe s not rely on the cost of r espondingas a de privation under the Mathews analy sis. See Tr. at 33- 34. -21- i n t e r e s t ; th e p art i e s d i s a g r e e , h o w e v e r , o nw h e th e r P R P s ar e f

o r c e d t o c o mp l y. 12 A. Mathews ProngOne 1. Depr ivations at UAO I ssuance The pa rties dispute whethe r GE is re quired to show that a PRP suffer s a depr ivation when a UAO is issued or when a PRP elec ts not to comply with it. EP A contends that GE is require d to show that PRP s suffer

injuries at issuance . EPA Opp. at 12. GE a rgues that the re levant deprivations are those at noncompliance be cause the par ties ag ree that there is a deprivation at compliance . GE Rep. at 12. Ne verthe less, GE submits that even thoug h it focused on c osts at
no nc omp lia

nc e , it s e xpe rt , D r. JohnGe we ke , h a s e sta bli sh e d th at " iss ua

nc e of a UA O w ou ld
cause an immediate de privation, whethe r or not a PRP complied." I d. I ssuance of a U AO arguably cause s two kinds of proper ty deprivations: (1) reduc ed stock pric e and inc rea sed cost of financ ing; a

nd (2) da mag e to the PRP's bra

nd value. Neither stock price /cost of financ ing impac ts nor brand va lue depletions ar e prote cted pr op e rt y int e re sts up on

me re iss ua

nc e of a UA O. Da

ma g e to s toc k p ri c e and

br and va lue c ou ld
oc c ur any tim e any a g e nc y take s any a c tio n th at th e mark e t inte rp re ts a s a dv e rs e a g a ins t a company . For

example, if the Securities a nd Ex chang e Commissi on announce d an investig ation of a c ompany

for se curities fr aud, that compa ny ' s stock price and bra

nd value mig ht suffer . The
s am e w o u l d

l i k el y o cc ur i f t h e F o o d

an d Dru g Ad m i n i s tra t i o nan n o un ce d th ati twa s re ca l l i n g a company ' s drugbeca

use of he alth conce rns. B ut surely neither of

those situations trigg ers due-22-

pr oc e ss c on c e rn s. Ind e e d, ann ounc e me nt o f t he ve ry pr e -i ssu anc e pr oc e ss t

hat G E s e e ks wo uld adver sely impact a PRP's stock pric e and br and value under G E' s argument. The Court would be inviting a host of unf

ounded due pr ocess c laims were it to conclude that stock pric e and br and value da mag e upon mer e issuance of a U AO constitute ac tionable prope rty deprivations. Counsel for GE r ecognized the need f or line-dr awingat the Oc tober 14, 2008 motions hear ing befor e the Court, but counse l proposed dra wingthe line at noncomplianc e, not at issuance . Tr. at 17 -1 9. Ac c or din g ly , G E h a s n ot s ho wn that PRPs su ff

e r a ny de pr ivatio n o f a

pr ote c te d p ro pe rt

y interest simply

upon issuance of

a UAO
. 2. De pr ivatio ns if

a PRP D oe s N ot C omp ly GE argue s th at PRPs are de pr ive d o f p ro pe rt y and lib e rt y if the y e le c t no t to c omp ly

wi th
a UA O. GE po int s to thr e e kin ds of de pr ivatio ns at no nc omp lia nc e . G E a g a in a sse rt s th at PRPs suffe r injuries re lating to their stock price and cost of f

inancing . GE also re prises its argument that PRPs inc ur

br and va lue dama g e . F ina lly , G E a rgue s th at PRPs ' re latio ns hip s w ith stakeholder s and EPA itself ar e impaire d if PRP s do not comply , there by deprivingPRP s of a pr ote c te d li be rt

y int e re st. As a thre shold matter, GE' s stock price /cost of financ ing a nd brand va lue re duction arguments do not suffer

from the same line-dra

wingproblems at the nonc ompliance stag e that doomed them at the issuanc e stag e. As c ounsel for G E put it, "the ax e fa lls" at nonc ompliance. See Tr. at 17. That is true bec ause a PRP is normally

brande d a re calc itrant ac tor once it decides
no t to c omp ly

-- a la be l th at e nh anc e s th e ha

rm to s toc k p ri c e and

br and va lue , a nd a lso
su pp os e dly e xpos e s PRPs to gre ate r p e na lti e s, inc re a se s p e rm itt ingtim e s, ba rs PRPs f ro m c e rt a in EPA prog rams, and impac ts PR Ps' re lationships with certain stakeholde rs. The de privations are-23-

thus both qualitatively

and quantitatively

differ ent upon noncompliance than upon issuance of a UAO. The se diffe renc es ar e suff icient to distinguish the impact of nonc ompliance with a UAO from the theor etical impac ts of other ty pes of a dverse g overnme nt action. GE base s its st ock pric e/cost of f inancingargument on the expert repor ts from Drs. John Gewe ke and Jason J ohnston. Dr. Gew eke, f ace d with a dea

rth of data

reg ardingthe impact of noncompliance on stock price , instead examines the impact of " specia l notice letters" on stock pr ic e fo r 2 90 pu

bli c ly -t ra de d c omp anie s in

19 94 . G e we ke Re po rt

at ¶ 13 . D r. Ge we ke a lso looks at the impact of spe cial notice le tters on bond yields for 89 c ompanies fr om 1995 to 1998. I d. EPA usually

sends spec ial notice letter s to PR Ps to i nitiate settlement discussions reg arding clea n-up of a hazardous site. EPA' s Statement of Fa cts (" EPA SOF" ) at ¶¶ 19-20. I f settlement fails, then EPA normally

issues a UAO . I d. at ¶ 27. The ref ore, D r. Ge weke conclude s, special notice letter s associate a PRP wit h a conting ent liability and neg atively

impact stock price and cost of fina

ncing . Gewe ke Report at ¶ 6. Usingtwo multivariate re g ression ana ly ses, Dr. Ge we ke the n e xtra

po late s w hat th e imp a c t on sto c k p ri c e and

c os t of fi na nc ingwo uld

be if a PRP
c ho se no t to c omp ly

wi th a UA O. L og ic a lly , c on tin g e nt l ia bil iti e s a sso c iate d w ith noncompliance are g reater than those a ssociated with a spe cial notice le tter bec ause EPA may seek tre ble and punitive dama g es if a PRP chooses not to comply . There fore , Dr. Ge weke
c on c lud e s th at " [a] f

ir m' s d e c isi on

no t to c omp ly

wi th a UA O .
. . su

bje c ts the fi rm

to a los s in marke t value that is 5.9 times gr eate r than its loss in market value a rising f rom a spec ial notice letter." I d. at ¶ 19. He calc ulates that the avera g e dec rea se in marke t value base d on
no nc omp lia

nc e wo uld

be $7 6. 4 mi lli on , c omp are d w ithan ave ra g e $1 2. 9 mi lli on de c re a se in marke t value base d on rec eipt of a spe cial notice le tter. I d. at ¶ 158 & Figure 7.-24-

Dr. Johnst on takes a

differ ent appr oach. L ike Dr. G ewe ke, Dr . J ohnston does not have sufficie nt data to ana ly

ze the impact of nonc ompliance on stock pr ice. Rathe r than foc using on specia l notice letters, howe ver, D r. Johns ton also looks at the impact of other "ne g ative
e nv ir onme nta l e ve nts " on a c omp any ' s st oc k p ri c e , s uc h a s E PA' s f ili ngof a c omp la int

a g a ins t a company or a c ompany ' s settlement of a Justi ce D epar tment lawsuit. See J ohnston Report at ¶¶ 34-37. Dr. Johnston does not conduct regression ana ly ses. Instead, he survey s four e x isting "e vent studies" that test the relationship betwe en neg ative envir onmental news a nd a stock pric e decr ease . See id. at ¶ 29 ( explaining the eve nt study methodology

). Dr. Johnston concludes that the se e ve nt s tud ie s p ro vid e " str on ge vid e nc e " that no nc omp lia nc e wi th a

UA O w ill re su lt i n "statisti cally

signific ant neg ative abnor mal stock marke t returns" for a targ eted PRP. I d. at ¶ 33. Be cause Dr. Johnst on does not conduc t his own event study , he does not proje ct the size of a potential noncompliance -base d stock price decr ease . EPA asserts that Dr . Gewe ke' s analy sis fails under the standa rd g overningthe
a dmi ssi bil ity

of e xpe rt op ini on e vid e nc e . Se e Da

ub e rt v. Me rr e ll D owPha

rm s. , Inc ., 50 9 U .S. 5 7 9 ( 1 9 9 3 )
. T h e p r o f

f e r i n gp arty mu s td e m o n s tr at e th e a dm i s s i b i l i ty o f e x p e rtt e s t i m o n y b y a preponde ranc e of the evidenc e under Daube rt and its prog eny . See Meister v. Med. Eng ' gCorp., 267 F.3d 1123, 1127 n.9 ( D.C. Cir. 2001). EPA first challeng es Dr. G ewe ke' s methodology
. EPA argues that he should have considere d empirica l evidence conce rningactua l instances of UAO nonc ompliance r ather than conduc ting a

"c ounterfa ctual" analy sis based on the impac ts of sp e c ia l no tic e le tte rs . T he Court c e rt a inl y a g re e s th at ana ly sis of

ha rd data is g e ne ra lly

pr e fe ra ble to projecte d data, a

nd would be her e. B ut empirical e vidence conce rningactua l instances of UA O n on c omp lia

nc e is s c arc e be c a

us e ve ry fe w p ub lic ly -t

ra de d f ir ms h ave c ho se n n ot t o c omp ly-25-

with UAOs. EPA' s own rebuttal e x pert, Dr . Donald Sieg el, testified that makinginfere nces based on r elated e vents was a ppropriate absent suff

icient data. See Deposition of Donald Sieg el at 173:19-175:3. Moreove r, re g ression ana ly ses ar e commonly used as e vidence in case s requiring"e x trapolati[on] from a sa mple of known data." L eague of United L atin Amer. Citizens
v. Pe rr y , 5 48 U. S. 3 99 , 4 67 (2 00 6) ; se e a lso Da nie l L . Ru

bin fe ld, Re fe re nc e Gu ide on Mu lti ple Reg ression, in Refe renc e Manua l on Scientific Evidence 181-85 (F eder al J udicial Center 2d e d. 2000). Ther efor e, a r eg ression ana ly sis is an acc eptable me thod of demonstratingthe impact of UAO nonc ompliance on stock pr ice a bsent sufficie nt empirical data. EPA nextquestions the assumptions underlying D r. Ge weke ' s analy sis. See EPA Opp. at 13-14. EPA hig hlights three supposedly flawe d assumptions: t hat firms that ar e issued UAO s at mul tip le sit e s w ill de c ide no t to c omp ly wi th a ny UA O; tha

t f ir ms that c ho os e no t to c omp ly wi th a UAO will be assessed max imum daily penalties for

a five -y ear

period (i.e ., that EPA will not br ingan e nf

or c e me nt a c tio n unti l th e statut e of lim ita tio ns is s e t to e xpir e ); and tha t th e mark e ts do no t di sc ount c on tin g e nt l ia bil iti e s b a se d o n th e lik e lih oo d o f e nf or c e me nt, the c ha

nc e that a PRP will successfully

defe nd an enf

orce ment action, or the possibili ty that a cour

t will im pose a smaller pena lty

than EPA reque sts. Although not without some forc e, none of these a lleg ed fl aws is s uf

fi c ie nt t o d isq

ua lif y Dr . G e we ke ' s r e po rt . H is m od e l do e s c a lc ulate po te nti a l im pa c ts if a PRP r e c e ive s mu lti ple UA Os and do e s n ot c omp ly

wi th a ny of the m, b ut h e re a c he s h is m a in conclusion -- that the ave rag e dec rea se in marke t value base d on UAO nonc ompliance is $76.4 milli on -- by

assuming that a PRP decide s not to comply with a sing le UAO. See Gewe ke Report at ¶ 158. More over, EPA doe s not meaning fully dispute GE' s assertion that " [i ]tis the g ov e rnme nt' s p ra c tic e in b ri ng ingsu it f or UA O n on c omp lia

nc e to s e e k th e statut or

y maximumin-26-

penalties a

nd treble da

mag es." See GE' s Statement of Undisputed F acts (" GE SUF" ) at ¶ 125 a nd EPA' s Response to GE SUF at ¶ 125. Whil e the Court is persua ded that EPA has a policy of
se e kin gmaximumdama g e s, GE ha s n ot o ff e re d a ny e vid e nc e to s ug g e st t

hat E PA r outin e ly

wa its as longas possible befor e filinga cost re cover y or enf orce ment action. The Court, then, will not ha zar d a re c a lc ulatio n o f D r. Ge we ke ' s f or mul a . B ut i t is c le ar t

hat sh or te r d e lay s in

fi lin gc os t
rec overy or enf orce ment actions would re sult in sm aller pote ntial penalties, smaller c ontinge nt liabiliti es, and, the ref

ore, a n aver ag e mar

ket value r eduction of le ss than $76.4 milli on. Simi larly , while Dr. G ewe ke spec ifically acknow ledg es that the mar ket may discount potential lia bil iti e s b a se d o n p os sib le de fe ns e s o r a c ourt ' s d e c isi on

to i mpo se sma lle r p e na lti e s th an E PA seeks, he argues that " the diffe renc e would be one only of mag nitude." G ewe ke Report at ¶ 27. True e noug h, but beca

use he did not attempt to quantify how much mar

kets would discount po te nti a l li a

bil iti e s, his $7 6. 4 mi lli on c a lc ulatio n is ne c e ssa

ri ly too high. Th e qu e sti on

at th is stag e of the inquiry , howeve r, is whether a depr ivation exi sts, not how larg e that depr ivation is. Se e Sul liv an, 52 6 U .S. at 59 . A lth ou g h im pe rf e c t, D r. Ge we ke ' s a

na ly sis de mon str ate s th at PRPs
are de pr ive d o f s ome po rt ion of the mark e t va lue of

the ir sto c k if the y de c ide no t to c omp ly

wi th a UAO
. EPA also asser

ts that Dr. J ohnston's r eport fa ils the Dauber t standard. EPA Opp. at 14- 15. EPA ag ain contends that Dr. Johns ton should have examined hard data rather than similar "ne g ative envir onmental eve nts." B ut Dr. Johns ton, like Dr. Ge weke , could not examine actual ins tanc e s o f n on c omp lia

nc e wi th UAO s b e c a

us e the re are no t e no ug h to c omp ri se a re lia ble data set. EPA next arg ues that Dr. Johnston shoul d have c onducted his own e vent study rathe r than relying on pr eviously -published ones. That argument has merit. Althoug h none of the case sSee EPA Opp. at 15 (citing In re N . Telec om L td. Secs. L itig., 116 F . Supp. 2d 446 13 (S .D .N .Y . 2 00 0) ; G ara

y v. Mo . Pa c . R. R., 60 F . Su pp . 2 d 1 16 8 ( D. Ka

n. 19 99 ); and

In r e Or a c le Secs. L itig., 829 F . Supp. 1176 (N.D. Cal. 1993)). -27- EPA cites support its argument that Daube rt requir es experts to conduct their own event studies, Dr. Johnst on' s relianc e on other economists' analy ses of other (albe it compara

ble) 13 events c erta inly

diminis hes the proba

tive value of

his ex pert re port. Dr. Johnston equates UAO
n o n c o mp l i an c e t o th e s e o th e r e v e n t s - - s u c ha s E P A ' s an n o un c e m e n to f a s e t t l e m e n to r

a n e w l yfiled lawsuit -- by

rea soning that "UA Os are ' one of the primary enfor ceme nt tools t o obtain a . . . response by

PRP ' s,' and ar e used to ' provide a n incentive f

or PRP's to settle' or to ' forc e commence ment of work at the site when settlement c annot be r eac hed.' " Johnston R eport at ¶ 32 (quoting USEPA, OSW ER Direc tive No. 9833.0-1a -3 (Ma rch 1990) ) (e llipsi s in origina l). But Dr. Johnst on does not explain why UAOs a re like a ny of the spec ific eve nts that the other eve nt
s tu d i es ex am i n e. Hi s co n cl u s i o n-- th atn ega t i v e e n v i ro n m en t al ev en t s ar e a s s o ci at edwi thl ar ge stock marke t decr ease s and that a U AO is a ne g ative envir onmental eve nt -- is equa lly vague. Thus, Dr. Johnst on' s repor t larg ely duplicates Dr . Gewe ke' s conclusions, only in a more g ener al and imprec ise way . The Court will not give signific ant weight to vag ue, cumulative e vidence
. S ee Fe d
. R
. E v i d
. 4 0 3
. He n ce , th e C o urtfi n d s th atDr
. J o h n s t o n 's re p o rtd o es n o tad v an ce GE 's argument that noncompliance with a UAO c auses a decr ease in stock price. The sec ond proff

ere d deprivation is GE's c ontention that a PRP ' s brand a sset is damag ed if it d oe s n ot c omp ly

wi th a UA O. Inta

ng ibl e a sse ts, lik e a

br and name , ma

y re c e ive du e pr oc e ss protec tion. See Delaw are , L acka wanna & W. R.R. Co. v. P ennsylvania, 198 U.S. 341, 359 (1905). GE ag ain re lies on Dr. Johnst on, who, without the benef it of adequate data, onc e more offe rs a g ener al, conc lusory opinion:-28-

F or fi rm s th at ha

ve ma de su

bs tanti a l inve stm e nts in e sta bli sh inga c or po rate br and

name for strongenvironmenta l perfor mance , events that we aken the firm' s brand name as a n environmenta lly

responsible a ctor c ause a definite a nd potentially

larg e dec rea se in the value of the cor porate environmenta l brand a sset . . . . John sto n Re po rt

at ¶ 15 . T his tim e , D r. John sto n d oe s n ot a pp ly any sc ie nti fi c me tho do logy

to test his conclusion. His report, howe ver, is salva g ed bec ause no one disputes his conclusion. Not even D r. Sieg el, EPA' s rebuttal expert, take s issue with it. S ee, e .g ., Siege l Dep. at 70:11- 70:14, 72:10-72:16, 73:6-73:10, and 79:13-79:17. More c ontroversia l is how much noncompliance with a UAO de cre ases the va lue of the br and asse t. Whi le Dr. Johnston opi nes that th e de c re a se is " po te nti a lly larg e ," EPAc or

re c tly po int s o ut t

hat D r. John sto n h a s n o d ata to support his conclusion. But, a g ain, at this stag e of the Mathews a naly sis, only

the exist ence of a pre- hear ing de privation matters, not its mag nitude. See Sullivan, 526 U.S. at 59. There fore , a lth ou g h D r. John sto n' s r e po rt do e s n ot h e lp t

he Court a sse ss h owmuc h n on c omp lia nc e imp a c ts brand va lue, his repor

t, and Dr. Sieg el' s response to it, suffic iently demonstrates that PR Ps are de pr ive d o f a

pr ote c te d p ro pe rt

y int e re st - - t

he va lue of

the ir br and -- wh e n th e y

do no t c omp ly with a UAO. F ina lly , G E a

rgue s th at PRPs su ff

e r p re -h e ari nglib e rt

y de pr ivatio ns un de r t

he D. C. Circuit's " reputation-plus" standa rd. This standar d has its orig ins in P aul v. Davis, 424 U.S. 693 (1976), whe re the Supreme Court " rec og nized the serious damag e that could be inflicted by brandinga g overnme nt employ ee a s ' disloy al,' and ther eby stigmatizing his g ood name." I d. at 706. The Court noted, howe ver, that it had "ne ver he ld that the mere defa mation of an individual, whether by

brandinghim disl oy al or other wise, wa s sufficient to invoke the guaran tee s o f pr ocedural du e pro cess abs entan acc ompan yin g los s o f governm entemp lo y men t. "-29-

I d. (e mph a sis a dd e d) . U nd e r t he D. C. C ir c uit ' s " re putatio n- plu s" sta nd ard , c oll ate ra l e ff

e c ts
acc ompanying r eputational injury must be "suf

ficiently formal or sufficie ntly

broad" to merit due proce ss protection. See Ta ylor v. Resolution Trust Corp., 56 F.3d 1497, 1506 (D.C. Cir. 1995);
see a lso Kartseva

v. Dep' t of State, 37 F.3d 1524 ( D.C. Cir. 1994) (explaining that a plaintiff could only

succe ed under

the re putation-plus standard if she showed re putational damag e that "a utomatically

exclud[ ed] her fr om a def inite rang e of e mploy

ment opportunities" or

that "br oadly prec lud[ ed] her fr om continuing in her chosen c are er" ). Collateral conse quence s are "suf ficiently formal or sufficie ntly

broad" when the reputation-injuring state ment automatically trig g ers some a dverse eff ect or prec ludes the injured pa rt y fr om p ur su ingc ho se n c ate g or ie s o f a c tiv iti e s in a wa y " e qu iva le nt i n e ve ry

pr a c tic a l se ns e to formal deba

rment." See Trif

ax C orp. v. District of Columbia, 314 F.3d 641, 643- 44 (D.C. Cir. 20 03 ). F or

e xamp le , in

Nat' l Co un c il o f R e sis tanc e of Ira n v . D e p' t of

State , 2 51 F .3 d 1 92 (D .C. Cir. 2001), the cour

t considere d the Anti-Ter rorism and Ef

fec tive Death Penalty

Act, 8 U.S.C. § 1189, which automatica lly bars de signated " fore ign te rror ist orga nizations " f

rom holding ba

nk
a c c ounts or

re c e ivi ngmate ri a l su

pp or t. T he c ourt

he ld t hat an o rg anizatio n w a s e nti tle d to proce ss before the State Depa rtment could issue a " fore ign te rror ist orga nization" desig nation. I d. at 203-04. Similarly , in Old Dominion Dairy Products., Inc. v. Sec' y

of De fense , 631 F.2d 953 (D.C. Cir. 1980), the De fense Depa rtment place d a wr itten finding of "nonr esponsiblity " in a
c o n tr a c t o r ' s p e r

m an e n tf i l e . U n d e r

th e a p p l i c a b l e a c qu i s i t i o nr e g u l at i o n s , a " r e s p o n s i b i l i ty" finding was re quired be fore a contr act c ould be awa rded. The court he ld that the contra ctor wa s e nti tle d to pr oc e ss b e fo re be ingla be le d a s " no nr e sp on sib le " be c a us e the la be l w ou ld b ro a dly , if not formally , prec lude the contr actor from obtainingother g overnme nt contrac ts. I d. at 963.GE ar g ues that " g ree n" inve stors calc ulate that GE' s overa ll environmental per formanc e 14 impacts its financial pe rfor mance . GE SUF at ¶ 19. GE does not, howe ver, pr ovide any evidenc e to sug g est that noncompliance with a UAO impac ts PR Ps' re lationships with s uch inv e sto rs . -30- GE ar g ues that PRPs that do not comply with UAOs suffe r re putational damag e along with four collate ral c onsequenc es: EPA seeks greater pe nalties for PRPs that routinely do not
c omp ly wi th UAO s; n on c omp lia nc e c ou ld m ake PRPs i ne lig ibl e fo r p art ic ipatio n in EPA pr og ra ms l ike " Pe rf

or ma nc e Tr a c k" and

" Cor po rate L e a de rs " ; no nc omp lia nc e c ou ld l e a d to inc re a se d p e rm itt ingtim e s; a nd no nc omp lia

nc e imp a ir s PRPs ' re latio ns hip s w ithso me sta ke ho lde rs . T he Court

c an e a sil y

dis po se of

the latte r t

hr e e c oll ate ra l c on se qu e nc e s G E a lle g e s, as they are entirely

hy pothetical. The fewcourts willing to spe culate that a collater al conseque nce w ill follow only do so when the c onsequenc es ar e inevitable. See , e.g ., Reeve Aleutian Airw ay s, Inc. v. United States, 982 F .2d 594, 598 & n.1 ( D.C. Cir. 1993) (holding that labelingan air line "unsa fe" would inevitably cost the airline f

uture g overnme nt contrac ts). The
c on c lus ion

that no nc omp lia

nc e le a ds to gre ate r p e rm itt ingtim e s, ine lig ibi lity fo r E PA p ro g ra

ms,
and imp a ir me nt o f r e latio ns hip s w ithsta ke ho lde rs is n ot n e arl y

so ine sc a pa ble . Ind e e d, de sp ite y ear s of discover

y , GE has not a sing le example of any of these c ollatera l conseque nces occur ringto any

PRP
. Absent any

evidenc e of suc h hy

pothetical collate ral c onsequenc es, the 14 Court will not assume they in fac t occur . Re ma ini ng , th e n, is G E' s c la im that no nc omp lia nc e is a c c omp anie d b y

g re ate r E PA penalties. The parties a g ree that EPA can a nd does take past UAO nonc ompliance into ac count when de termining what pena lties it wil l seek for a fr esh instance of UAO noncompliance . See GE SUF at ¶

13 2, EPA ' s Re sp on se to G E SU F at ¶ 13 2, and GE ' s Re ply

to E PA' s Re sp on se to-31-

GE SUF at ¶ 132. But greater pe nalties are not an automatic c onsequenc e of nonc ompliance. See De position of W alter Mug dan at 228:4-12; De position of Kenneth Patterson at 91:4-92:22. There fore , the log ic of c ases like Na t'l Council of Resistanc e of I ran doe s not apply . Rather, the question is whether the likelihood of g reater pe nalties will "broa dly prec lude" PRP s from
car rying out their

chosen line of

business. See Ka

rtseva, 37 F .3d at 1527. And the a nswer is that the y do no t. An " un sa fe " a ir lin e may be br oa dly

pr e c lud e d f

ro m r e c e ivi nga ir

tr ans po rt c on tr a c ts, see Ree ve, 982 F .2d at 598; an " unreliable " military contra ctor may

be broa dly

prec luded from ob ta ini ngfutur e c on tr a c ts, se e Ol d D omi nio n, 63 1 F .2 d at 96 3; a nd a Rus sia n tr ans lator

wi th

" c ounte ri nte lli g e nc e c on c e rn s" -- be fo re the c oll a ps e of the Sov ie t U nio n - - m ay

be br oa dly prec luded from a

chosen c are er a s a public employ ee, se e Ka rtseva, 37 F .3d at 1529-30. Inc re a se d p e na lti e s d o n ot h ave the same imp a c t on a PRP - - a ty pic a l PRP i s n ot b ro a dly prec luded from its chosen line of business when it does not comply with a UAO, e ven if the penalties a

re substantial. To be sure, GE argues that UAO s can at times be so onerous as to put PRP s out of business. Gewe ke Report at ¶ 21. Acc eptingthat asser tion arguendo, it still does not rise to the level ne eded to trig g er the reputation-plus standard: a " won some and lost some"
rec ord is not "r emotely

close" to "br oad pre clusion." See Trifax , 314 F.3d at 644. Be cause GE has not pointed to "suf

ficiently formal or sufficie ntly

broad" collater al conse quence s of being la be le d a no nc omp lyingPRP, the n, no nc omp lia nc e do e s n ot c a

us e PRPs t o s uf

fe r a lib e rt y deprivation under the re putation-plus standard. Stil l, GE has alleg ed suff

icient pre -hea

ring , noncompliance -base d deprivations for the Court to procee d to prongtwo of the Mathe ws ana ly sis. Although GE ha s not pointed to a
re putatio n- plu s li be rt

y de pr iva tio n, GE ha s p ointe d to tw o d e pr ivatio ns of pr ote c te d p ro pe rt

y-32-

interests re sulting fr om noncompliance w ith a UAO: dama g e to stock price and dama g e to bra nd value. The Court discounts Drs. Gewe ke' s and Johns ton's c onclusions with reg ard to the size of tho se de pr ivatio ns , b ut t

he Court a c c e pts the ir

c on c lus ion s a s to the e xiste nc e of tho se de pr ivatio ns . 3. Depr ivations if a PRP Compli es Th e qu e sti on

be fo re the Court

is n ot whe the r t

he re sp on se c os ts a

PRP in c ur s if

it complies with a UAO are protec ted prope rty interests under

the Due Proc ess Clause. The parties ag ree that they

are . See EPA Mem. at 21. Rathe r, the que stion is whether PRPs have a
m ea n i n gfu l ch o i ce n o tt o co mp l y wi tha U AO o n ce i ti s i s s u ed
. Inre j ec t i n g GE 's fa ci al ch al l en ge to s e c tio n 1 06 in G e ne ra l E le c tr ic I I I , th e Court e xpla ine d th at: Th e a bil ity of the PRP to c ho os e , und e r t he langua g e of

the statut e , whe the r t o c omp ly wi th a se c tio n 1 06 or de r i s k e y . Upo n a re fu sa l to c omp ly

wi th a se c tio n 1 06 or de r, EPA is powerless to depr ive the PRP of property without judicial intervention. On the other hand, we re the PRP to be depr ived of a ny meaning ful choice to refuse to comply with an or de r, that mi g ht p os e a

dif fe re nt s itu atio n in

a sse ssi ngwh e the r a

de pr ivatio n o f p ro pe rt

y has occ urre d. 362 F. Supp. 2d at 339. GE a rgues that EPA' s pattern a nd prac tice of a dminist eringsection 106 does indee d deprive PRP s of a " meaning ful choice " to r efuse to comply with UAOs. Ther efor e, the ar g ument g oes, PRPs are denied the ve ry safe g uard the Court previously held nec essar

y -- the opportunity

for a pre- deprivation hearingby choosingnot to comply . GE' s argument raises two qu e sti on s. F ir st, a s a

le g a l matte r, if

a PRP is no t un c on sti tut ion a lly c oe rc e d und e r E x part e Yo un g , ma

y it n on e the le ss b e de pr ive d o f a me anin g fu l c ho ic e no t to c omp ly ? Se c on d, if so me le sse r c oe rc ion

sta nd ard do e s a pp ly , a re PRPs i n f

a c t de pr ive d o f a

me anin g fu l c ho ic e no t to comply ? The a

nswer to both questions is no.-33-

GE ha s n ot p ro po se d a

ny le g a l f ra me wo rk to a na ly ze c oe rc ion

oth e r t ha n th e Ex pa

rt e Youngstandard. A s discussed supra, G E has not demonstrate d that EPA' s pattern a nd prac tice of administeringsection 106 violates Ex parte Youngby unconstitutionally

intimi datingor coe rcing PRP s into compliance whe never a UAO is issued. GE has not cited to any prec edent sug g esting th ata s t atu t e o r a gen cy

p o l i cy , al th o u ghn o tun co n s t i tu t i o n al l y co er ci v e u n d er

E x p art e Y o un g, c an s til l be su ff

ic ie ntl y c oe rc ive so a s to de ny

on e a me anin g fu l op po rt

un ity to e le c t no t to comply . The Court will not invent a new " lesser c oerc ion" leg al fra mework f rom scratch. There fore , GE' s argument that PRP s are deprive d of a me aning ful choice -- e ven if they are not
coer ced into complianc e under an Ex parte Younganaly sis -- fa ils as a matter of law. GE' s argument is belied by the fa cts as we ll. GE repr esente d at both the motions hearing and in its brief that EPA ac hieves a near -per fec t rec ord of c ompliance with UAO s. See Tr. at 5; GE Me m. at 50 -5 1. GE ' s e xpe rt , D r. Rouha ni, ho we ve r, su g g e sts that E PA' s r e c or d r e fl e c ts a modest rate of

noncompliance . Of the 5,422 PRPs who were issued UAOs be tween 1982 a nd 2006 that he examined, there wer e 189 instance s of PRP s not complying - - a r ate of 3.5 perc ent. See Rouhani Report at 6.52 & Ta ble 8(a ). And of the 1,638 PRP s who have been issued UAOs
mos t r e c e ntl y , th e re we re 75 ins tanc e s o f n on c omp lia nc e -- a rate of 4. 6 p e rc e nt. I d. at T a

ble 8(b). The se rates of noncomplianc e mirror the kind of " acc eptable r ate of err or" tolerate d by courts, see Shands v. Tull, 602 F.2d 1156, 1160 (3d Cir. 1979) ( holding that a four pe rce nt error rate constitutes "substantial complianc e" with a statute), not the " rema rkable rec ord" of " selfconfide nce" GE cla ims, see Tr. at 29:9. The c osts of clea

n-up that follow complianc e, pair ed with the pre -hea ringstock price and brand va lue depr ivations caused by noncompliance , demonstrate that PR Ps suffer pr e-he aring-34-

deprivations whether or

not they comply . But be cause the Court will not invent a new and le sser leg al standar d for c oerc ion under Mathe ws -- a nd GE has not demonstrated that EPA' s pattern and pra ctice is unduly

coer cive unde r Ex parte Young-- the Court holds that PRPs are not deprive d of a me aning ful opportunity not to comply . This conclusion is bolstered by GE' s own e xpe rt , D r. Rouha

ni, wh o d e mon str ate s th at in sta nc e s o f n on c omp lia

nc e are su ff

ic ie ntl y
nu m e r o u s t o s u g g e s tth atP R P s ar e n o t , i nf a c t , f o r c e d t o c o mp l y. B. Mathews ProngTwo GE has de monstrated that PRPs are depr ived of at least some prope rty interests whe ther or not they

comply with a UAO, a

nd hence the Court must procee d to the second pr ongof the Mathews a

naly sis. At this stag e, the Court must first identify the private interest impacte d by g overnme nt action, the g overnme nt interest in avoidingadditional pre- decision proc ess, and the risk that the cur

rent proc ess will result in error . See Mathe ws, 424 U.S. at 355. Once the Court has identified those thre e fa ctors, it must weig h them ag ainst one anothe r to deter mine whether additional proce ss is constitut ionally require d befor e EPA issues a UA O. See id. The proc ess that EPA now provides be fore issuing a UAO bea rs on the identification and balanc ing of

these fa ctors. Onc e EPA identifies a "Super fund" site, it searc hes for PRP s by iss uin ginf

or matio n r e qu e sts and

c on du c tin gint e rv ie ws . E PA S OF at ¶ 5. PRPs a

re pe rm itt e d to provide infor

mation reg ardingboth liabilit y and re medy

selec tion. I d. at ¶ 6. EPA provide s notice to potential PRP s throug h a " g ener al notice" letter. I d. at ¶ 8. PRPs t hen ag ain have the opportunity

to respond to g ener al notice letter s and provide inf ormation reg ardingliability and
reme dy selec tion. I d. at ¶ 9. B efor e sele ctinga re medy , EPA solicits publ ic comments and compiles an a dminist rative r ecor d, which norma lly happens ove r the c ourse of wee ks or months.-35-

I d. at ¶¶ 13- 14, 18. PRP s are , of cour se, per mitted to contribute to that recor d. I f the re medy selec ted is settlement -- EPA' s pref err ed re medy

-- then E PA either issues a " specia l notice letter" or provides othe r written notice to PR Ps. I d. at ¶¶ 19- 20. Settlement neg otiations take a "sig nificant pe riod of time" and PRPs are normally repr esente d by

counsel. I d. at ¶¶ 21- 22. PRP s are permitted to, and ofte n do, challeng e EPA' s determinations re g ardingliability and
reme dy selec tion during the neg otiation process. I d. at ¶ 23. F inally , at the end of this lengthy proce ss and only

if neg otiation fails, EPA will normally issue a UAO
. 1. Pr ivate Inte re st The ty pe and le ng th of the pre -hea ringdeprivation inform the constitutional relevanc e of the private interest. See City of L os Ang eles v. Da

vid, 538 U.S. 715, 717 (2003); Mathews, 424 U.S. at 341-42. De privations that can be rec ouped af ter a hear ing - - like pure ly

financ ial deprivations -- are less signific ant than irre para ble depr ivations. See David, 538 U.S. at 717 (holding that a tempora

ry deprivation of a ca

r wa s more sig nificant than a deprivation of money in the form of impoundment and towingfee s). A substantial financ ial deprivation bearing
c oll ate ra l c on se qu e nc e s - - f or e xamp le , a

n e ff e c t on a c omp any ' s o pe ra

tio ns -- is n ot p ur e ly financ ial and is a more signific ant private interest. See Mathews, 424 U.S. at 341-42. No matter the ty pe of the de pr ivatio n, mor e ov e r, " the re is a po int at w hic h a

n unju sti fi e d d e lay

in completinga post-depr ivation proce eding' would become a constitutional violation.'" Fe dera l Deposit Ins. Corp. v. Mallen, 486 U.S. 230, 242 (1988) ( quoting Cleve land B d. of Educ. v. L oudermill, 470 U.S. 532, 547 (1985)). He re , th e signif

ic anc e of the pr e -h e ari ngde pr ivatio n v ari e s d e pe nd ingon wh e the r o r n ot a PRP c omp lie s w itha

UA O. GE re lie s o n th e e xpe rt op ini on of Dr . Sh ahr ok

h Ro uh ani t oDr. Rouhani also c alculate s the ave rag e costs if a PRP chooses not to comply with a 15 UAO. Assumingthat EPA clea ns up a site itself, bring s an enf orce ment action ag ainst the no nc omp lyingPRP, and

pe rs ua de s a

c ourt to a wa rd punit ive dama g e s a

nd the maximumda ily fines for the ave rag e per iod of completion, Dr. Rouhani c alculate s that the ave rag e costs of noncompliance are more than $54 million. Rouhani Report at ¶ 6.3.5. B ut beca use PRPs rec eive a full judicial hea

ringbefor e any

of those costs may

be imposed, those costs of nonc ompliance do not fac tor into an assessment of whether more proc ess is neede d befor e a UAO may be issued. -36- e sta bli shthe de pr ivatio ns fa c e d b y PRPs who c omp ly

wi th a UA O. Dr . Ro uh ani o bta ine d d ata reg ardingEPA' s CERC L A enf orce ment activities from the Compre hensive Environme ntal Response, Compensation and L iability Information Sy stem (" CERCL I S"), a n EPA databa se. Rouha ni R e po rt at ¶ ¶ 1 .2 , 4 .1 -4 .4 . B a se d o n h is a sse ssm e nt o f t hat da ta , D r. Rouha

ni o pin e s th at,
on aver ag e, complying w ith a UAO c osts a PRP $4 milli on. I d. at ¶¶ 2.1.3, 6.2- 6.3. 15 F or the c os ts o f n on c omp lia

nc e wi th a

UA O, GE re lie s o n th e e xpe rt re po rt s f ro m D rs . J ohnston and Gew eke. A s discussed ea rlier, ne ither expert re port proper ly quantifies bra

nd value reduc tion or market va lue dec line. Dr. Johnst on, who addr esses bra nd value r eduction, does not attempt to quantify

how much bra

nd value dr ops for a

n aver ag e noncomplying PRP. Dr. Gewe ke, who a ddresse s market va lue dec line, opines that PRP s suffer an ave rag e $76.4 million de c lin e in m ark e t va lue if the y do no t c omp ly

wi th a UA O, but he a c kn ow le dg e s th at ma rk e ts
may dis c ount p ote nti a l li a

bil iti e s, the re by

" le sse n[in g ] som e wh at th e imm e diate fi na nc ia l im pa c ts of a de cision not to comply with a UAO." Gewe ke Report at ¶ 27. Yet Dr . Gewe ke does not
a sse ss h owmuc h ma

rk e ts d isc ount p ote nti a l li a bil iti e s. Mo re ov e r, his $7 6. 4 mi lli on fi g ur e is ba se d o n th e un fo un de d a ssumpt ion that E PA w a its a s lo nga s p os sib le be fo re br ing ingc os t
rec overy or enf orce ment actions. Ther efor e, the Court is left without a re liable quantification of the e c on omi c de pr ivatio ns no nc omp lyingPRPs s uf fe r. Rathe r t

ha n d ism iss ingthe e xpe rt

re po rt s e nti re ly , h ow e ve r, the Court is p e rs ua de d th at no nc omp lyingPRPs s uf fe r a signif ic ant d e c re a se in-37-

br and and mark e t va lue , a lbe it s ome thi ngle ss t ha n $ 76 .4 mil lio n. Th e Court wi ll p ro c e e d w ith the Mathew s prongtwo assessment base d on that estimate of the pr ivate intere st impacted by noncompliance
. The de privations that GE alleg es ar e primar ily financ ial ones. F inancial de privations are less troubling be cause money can be rec ouped in a post-de privation hea ring . See David, 538 U.S. at 717. But de privations cause d by UAOs a re pote ntially

so larg e -- on aver ag e $4 million for c omply ing PRPs and some substantial, unidentified amount for nonc omply ing PRPs -- that they may have c ollatera l effe cts. UAOs c ould put some PR Ps out of business. S ee G ewe ke Report at ¶ 21. F or other PRPs, UAOs may aff ect ope rations, like whethe r to bid for ne w projec ts or to hire additional employ ees. See id. at ¶ 25. Ye t for other companies, like G E, UA Os are " no t mate ri a l to
. . . f ina nc ia l po sit ion s, re su lts of

op e ratio ns , o r l iqu idi ty ." Se e EPA S O F at¶ 4 5 ( qu o t i n gG E A n nu a l R e p o rt s , 1 9 9 7
- 2 0 0 0 )
. T h e v ar i e ty o f c o l l at e r a l e f

f e c t s , i f an y, pr e c lud e s th e Court

fr om r e a c hin ga

sin g le c on c lus ion

a bo ut t he signif ic anc e of UA Os fo r a ll PRPs. Stil l, a

g e ne ra l c on c lus ion

is p os sib le : a lth ou g h th e pr ivate int e re sts are le ss constitutionally

signific ant bec ause the y

are primarily

financ ial, they

are sufficie ntly

larg e and have e no ug h p ote nti a l c oll ate ra l e ff e c ts t o c on sti tut e we ig hty pr ivate int e re sts . GE ar g ues that PRPs are deprive d of these pr ivate intere sts for leng thy periods of time. Under section 106(b) , a complying PRP may seek r eimbursement " upon completion of the require d action." On ave rag e, it takes thre e y ear s to fully comply with a UAO. Rouha

ni Report
at¶ 6
. 2
. M o r e o v e r , G E ar g u e s , E P A c l a i m s th e p o w e r un i l at e r a l l y

t o d e l ay " c o mp l e t i o n . " In proce eding s befor e the Environme ntal Appea ls Boar d (" EAB ") , the body that revie ws section 106(b) r eimbursement pe titions , EPA has at times succe ssfully argued that a pe tition s hould be-38-

dis mis se d b e c a

us e of a PRP' s f a ilure to o bta in a

n E PA " c e rt if

ic ate of c omp le tio n. " GE SUF at ¶ 91. In the cur

rent proc eeding s, howeve r, EPA contends - - cor rec tly -- that the statute does not require an EPA dete rmination that the clea n-up is complete be fore a complying PRP may file a reimburse ment petition. See 42 U.S.C. § 9606(b); EPA Response to GE SUF at ¶ 91. I f a
co mp l yi n g P R P b el i ev es th ati th as co mp l et eda c l ea n -up b u tth e E AB d ec l i n es th e P R P 's reimburse ment petition for fa ilure to obtain a c ertificate of c ompletion, the PR P may appea l the EAB decision to an Ar

ticle I I Icourt. See Employ ers Ins. of Wausau, 52 F .3d at 662. Ther e, the PRP c an a

rgue that th e EA B ma de le g a l e rr or s ( lik e a c c e pti ngEPA ' s a rgume nt t hat a c e rt if ic ate of completion wa s require d) or f actua l error s (like findingthe clea n-up incomplete) . There fore , a lth ou g h D r. Rouha

ni' s c on c lus ion

that U AO s ta

ke , o n ave ra g e , thre e y e ars to c omp le te is persua sive, the Court is not persuade d that EPA can unilate rally delay reimburse ment proce eding s by

ref using to issue a

cer tificate of completion. GE argue s th at PRPs are a lso ind e fi nit e ly " le ft in l imb o" if

the y c ho os e no t to c omp ly with a UAO. E PA has two way s to enforc e UAO s under CERCLA. Fir st, EPA can bringan e nf or c e me nt a c tio n a g a ins t a no nc omp lyingPRP. En fo rc e me nt a c tio ns mus t be br ou g ht w ith in fi ve y e ars of

a " vio latio n. " Se e 28 U. S.C. § 2 46 2. Se c on d, EPAc an c omp le te the UA O i tse lf
and fi le a c os t r e c ov e ry

pe tit ion a g a ins t th e PRP. Cos t r e c ov e ry pe tit ion s mu st b e fi le d w ith in three y ear s of completion for r emoval ac tions and within six y ear s of completion for r emedial actions. 42 U.S.C. § 9613(g )(2) . GE ar g ues that these statutes of limitations permit an unconstitutionally

long de privation bec ause the y are paire d with a " remova l or reme dial action [that] may

its e lf take y e ars to c omp le te " su c h th at " the g ov e rnme nt m ay take its own s we e t ti me befor e suing ." See GE Mem. at 38- 39 (quoting Reardon v. United States, 947 F.2d 1509, 1519-39-

( 1 s tC i r . 1 9 9 1 ) )
. InR e ar d o n , ana s - a p p l i e d c h a l l e n g e , th e F i r s tC i r c u i th e l d th atth e C E R C LA statut e s o f l imi tatio ns c on tr ibute d to the un c on sti tut ion a lity of a dif fe re nt s e c tio n o f C ERC L A i n a spec ific setting . 947 F.2d at 1521. But no cour t has reje cted these CERCL A statutes of limit ations in a fac ial challeng e. Indeed, this Court denied G E' s fac ial challeng e to the statutes of lim itatio ns in G e ne ra l E le c tr ic I I I . Se e 36 2 F . Su pp . 2 d at 36 3. Th e Court inv ite d G E t o r e vis it this argument in its pattern and pra ctice c laim by prese nting e vidence that EPA indeed
unre a so na

bly de lay s e nf

or c e me nt p ro c e e din g s. I d. B ut G E h a s n ot o ff e re d a ny e vid e nc e to sug g est that EPA in fac t delay s enfor ceme nt or cost re cover y proce eding s. There fore , the Court
c on fi rm s it s p ri or

re je c tio n o f a

c ha lle ng e to t

he CER CLA s tatut e s o f l imi tatio ns and he nc e a lso reje cts GE' s argument that PRP s are deprive d of prope rty for e x tended pe riods of time if they choose not to comply

with a UAO. In short, the re levant private intere st at issue is primarily a fina ncial one. T he magnitude of the private intere st depends on whe ther or not a PRP complies, and UA Os have collater al
e ff e c ts o n o pe ratio ns fo r s ome PRPs b ut n o ma te ri a l im pa c t on oth e rs . Wh ile in t

he or y a PRP
c ou ld b e de pr ive d o f t

hat pr ivate int e re st f

or se ve ra l y e ars , G E h a s n ot d e mon str ate d th at E PA i n fac t routinely

waits as longas the CERCL A statutes of limitations allow before bring ing
e nf or c e me nt o r c os t r e c ov e ry a c tio ns . 2. Go ve rnme nt I

nte re st Two fa ctors ar e par amount in identifying the g overnme nt interest. The f irst is whether the g overnme nt has " a spec ial need f or ver y prompt action." See F uentes v. Shevin, 407 U.S. 67, 91 (1972). The g reater the g overnme nt's ne ed for prompt action, the greater the g overnme nt interest in avoidingadditional pre- deprivation process. I d. The sec ond fac tor is the financ ial andWhether or not " imminent and substantial" is sy nony mous with "eme rg ency " a s a leg al 16 matter is an issue this Court need not de cide. -40- operational cost of additional proc ess and the ne ed to conse rve " scar ce f iscal and a dminist rative
resour ces." See Mathe ws, 424 U.S. at 347-48. The cost of additional proc ess will vary
acc ordingto its nature. Wherea s a full judicial hea ringcar ries substantial financ ial and administrative costs, notice a nd an informa l opportunity to be hea rd is far less burdensome. T he
c os t of a dd iti on a l pr oc e ss a lso va ri e s a c c or din gto i ts v olume . T he mor e of te n th e g ov e rnme nt i s require d to provide additional proc ess, the g reater the bur den on the g overnme nt. See id. at 348. EPA lacks a " specia l need f or ver y prompt action" in issuing UAOs unde r sec tion 106 of CERCL A. See F uentes, 407 U.S. at 91. To be sure, EPA may only issue a UAO upon a finding of " imminent and substantial endang erme nt to public health or we lfare or the e nvironment." 42 U.S.C. § 9606(a). None theless, the par ties ag ree that EPA does not issue UAOs in true
emer g ency

situations. See GE SUF at ¶¶ 37- 38. In true e merg ency situations, EP A clea

ns up a 16 site itself and later

files a c ost recove ry

action. I d. at ¶ 38. EPA neve rtheless a rgues that UAO s are more time-se nsitive than wholly non-eme rg ency

situations -- that is, UAOs occ upy a g ray are a in betwe en eme rg ency and non-e merg ency

situations. But GE re sponds that whateve r the contours of that gr ay

are a, EPA' s prac tices demonstrate that UAOs do not re quire " very prompt
a c tio n. " GE po int s to Dr . Ro uh ani' s r e po rt , whic h d e mon str ate s a n ave ra g e e ig ht ye ar l a g -t ime be tw e e n id e nti fi c atio n o f a ha zar do us wa ste sit e and iss ua nc e of a UA O a nd a fo ur y e ar l a g -t ime be tw e e n r e me dy

se le c tio n a

nd UA O i ssu anc e . Ro uh ani R e po rt at ¶ 6. 1. 3. Al tho ug h E PA i ns ist s that it is busi ly

investigating a

nd neg otiating dur ing that leng thy period, Dr . Rouhani' s repor t de mon str ate s th at th e g ov e rnme nt l a c ks a " sp e c ia l ne e d f

or ve ry pr omp t a c tio n" in i ssu ingUA Os
.Dr. Rouhani points out that UAOs have been issued mor e fr equently in the past 15 17 y ear s than they

wer e for the first ten year s. See Rouhani Report at 6.7. The Court's c alculation, there fore , undere stimates the number of UAOs EPA cur rently issues per month. -41- The sec ond consideration is t he cost of the additional proce ss GE seeks. A lthough GE has not outlined exactly

what that additional re quested proc ess is, GE ar g ues that some sort of
n eu tra l d ec i s i o n -m ak er

i s re qu i re d
. S ee GE Op p . at2 4 -2 5
. T h e "m o s to b v i o u s s o l u t i o n " i nGE 's view is a full judicial hea ringbefor e an Article I I Ijudge . See Tr. at 9:8-10:17. J udicial proce eding s, howeve r, ar e fr aug ht with considerable expense and de lay , and cour ts rare ly import the judicial model into administrative decision-making . See Mathe ws, 424 U.S. at 348. Other methods of providingadditional proce ss are less costly and time-c onsuming. F or example, courts have held that an a dminist rative la w judg e (" AL J ") , see Rosen v. N L RB, 735 F .2d 564, 57 0 ( D. C. C ir . 1 98 4) , a

nd a de ta c he d " pr e sid ingof

fi c e r" wi thi n a

n a g e nc y , s e e Che mic a l Wa ste Mg mt., I nc. v. EPA, 873 F .2d 1477, 1485 (D.C. Cir. 1989), ar e both ade quate ne utral dec isionmake rs . A lth ou g h th e g ov e rnme nt h a s a high inte re st i n avo idi ngthe c os ts a nd de lay s o f a

fu ll judicial hear ing, it has a

lower inter est in avoiding the less forma l proce ss before an AL J or ag ency presidingoffice r. Th e c os t of

the a dd iti on a l pr oc e ss a lso de pe nd s o n h owof te n th e g ov e rnme nt m

us t provide it. See Mathe ws, 424 U.S. at 348. Be tween Aug ust 16, 1982 and May 25, 2006 -- a period of 285 months -- EPA issued 1,705 UAOs to more tha n 5,400 PRP s. See Rouhani Report
at ¶ ¶ 4 .3 , 6 .5 .2 . O n ave ra g e , th e n, EPAha s is su e d a pp ro ximate ly

six U AO s to nin e te e n PRP s ever y month. Be cause EPA g ener ally issues UAOs only

when ne g otiations with a PR P have 17 failed, most PRP s would contest the UAO throug h the pre -issuance hear ing G E seeks. To be
sure , E PA m ig ht i ssu e fe we r UAO s if mor e pr e -i ssu anc e pr oc e ss w e re re qu ir e d. B ut b e c a us e-42-

UAOs involve hig h stakes and c omplex technica l judgments, a ny hear ing be fore a neutr al decision-make r would involve sig nificant fisc al and a dminist rative bur dens; henc e, eve n a fra ction of the c urre nt monthly rate of UAO issuance w ould ge nerate a substantial impairment of the g overnme nt's inter est measur ed in the fina ncial and a dminist rative c osts of that additional pr oc e ss. 3. Risk of Error Analy sis of the risk of er

ror is diffe rent for

a patter n and pra ctice c laim than it is for either a fa cial or a

n as-a pplied challeng e. Case la w provides sc ant guidance , howeve r, on just what that dif fe re nc e is. Th e fe w c ourt s th at ha ve de c ide d p atte rn

and pr a c tic e pr oc e dura l du e pr oc e ss claims have expounded litt le on the risk of e rror analy sis. See, e.g ., Haitian Refug ee Ctr., Inc. v. Ne lso n, 69 4 F . Su

pp . 8 64 (S .D . F la . 1 98 8) , a ff ' d 8 72 F .2 d 1 55 5 ( 11 th C ir . 1 98 9) , a ff ' d s ub no m. McNa ry v. Haitian Refug ee Ctr., Inc., 498 U.S. 479 (1991). G E urg es the Court to adopt the same kind of a

bstract a pproac h that courts use in both fa cial and a s-applied c halleng es. See Tr
. at 42 :5- 42 :11 ; G E M e m. at 48 (c iti ngCare y v. Pip hu s, 45 3 U .S. 24 7, 26 6 ( 19 78 )) . U nd e r t his approa ch, cour

ts "look g ener ically

at whethe r the kind of inquiry that is involved is the kind that is error -prone and the kind that would be be nefitted by proce dural fa irness." Tr. at 42:5-42:11. B ut t he Court is n ot p e rs ua de d th at th e a bs tr a c t a pp ro a c h is the c or

re c t on e he re . With th e be ne fi t of a f ull factua l rec ord -- in this case, followingy ear s of discover y -- plaintiffs in pattern and pr a c tic e c la ims c ann ot r e ly on a bs tr a c t le g a l c on c e pts a lon e . A lth ou g h a bs tr a c t le g a l c on c e pts may inform the Court' s analy sis reg ardingthe risk of e rror , GE must also demonstrate that the
c ur re nt p ro c e dure s in

fa c t r e su lt i n a

n una c c e pta

ble rate of

e rr or . It w ou ld m ake little se ns e to ignor e the e mpirical re cord a ltoge ther in favor of a hy pothetical conc ern that the risk of er ror may-43-

be too hig h.
a . Ab str a c t Co nc e pts Ac c or din gto G E, the c ru c ia l e le me nt m iss ingfr om E PA' s p re -UAO iss ua nc e pr oc e ss i s a neutra l decision-make r. Althoug h the Constitut ion does not require a neutr al dec ision-maker, se e, e.g ., Old Dominion, 631 F.2d at 968 (holdingthat an opportunity to be hea rd by a contr acting office r, the ve ry

person de cidingwhether the plaintiff is a " responsible" contra ctor, satisfies due proce ss), ample c ase la

w supports GE' s point that a neutral de cision-maker is an important constitutional safeguard, se e, e.g ., Propert v. District of Columbia, 948 F.2d 1327, 1333 ( D.C. Cir. 1 9 9 1 ). T h er ef

o re , th e l ac k

o f an eu tra l d ec i s i o n -m ak er , as an ab s tra ctp ri n ci p l e, s u p p o rt s GE 's argument that EPA' s pre- issuance pr ocess is er ror- prone. Severa l other abstra ct principles sug g est the pre -dec isional process may result in err or. The risk of e rror

is gr eate r whe n "the State stands to benef it" by takingaction that depr ives someone of pr operty . United States v. J ames Da niel Good Real Proper

ty , 510 U.S. 43, 55-56 (1993) ( quoting Ha

rmelin v. Michig an, 501 U.S. 957, 979 n.9 (1991)) . Although the re is no dire ct fi na nc ia l in c e nti ve at w or

k h e re , E PA a

rgua bly sta nd s to be ne fi t by

iss uin gUA Os be c a

us e EPA ha s an inte re st i n c on se rv ingSup e rf un d r e so ur c e s. Se e EPASOF at ¶ 2. Th e ri sk

of e rr or is a lso g reater whe n junior or re g ional ag ency staff, w ithout senior or ce ntralized oversig ht, make deprivation-causingdecisions. See James Madison L td. by Hec ht, 82 F.3d at 1100. UA Os are issued by reg ional EPA officia ls without review and a pproval fr om EPA headqua rters. EPA SOF at ¶ 42. The ref

ore, a lthough nothingpreve nts PR Ps from contac ting EPA he adquar ters to re g ister
c omp la int s a

bo ut UAO iss ua

nc e , th e a uth or ity of re g ion a l E PA o ff

ic ia ls t o is su e UA Os a lso supports GE' s argument that EPA proce dures c ould result in a hig h rate of er ror.-44-

On the oth e r h and , s ome pr inc ipl e s th at G E c ite s d o n ot s ug g e st tha t E PA' s p ro c e ss i s err or-pr one. GE a

rgues that ex parte pr ocedur es, like those in Doehr , 501 U.S. at 14, enhanc e the
r is k o f e r r o r . InD o e h r , th e Su

p r e me Co urt t o o k

is s u e w it h" s e c r e t, o n e - s id e d

d e te r mi n ati o n [s ]" that pr ov ide d a ff

e c te d p art ie s w ithno no tic e or op po rt un ity to b e he ard . I d. (q

uo tin gJoint

AntiFa scist Refug ee Comm. v. McGr ath, 341 U.S. 123, 170 (1951) ( Fr ankfur ter, J., concurring )). The informal pre -issuance proce ss that EPA provides here , howeve r, is neither se cre t nor one-side d. PRP s are g iven multiple kinds of notice and have sever al opportunities to be hea rd bef ore a UAO is issued. See EPA SOF at ¶ ¶ 5-23. GE also argues that the hig hly fac tual, highly

technica l nature of UAO issuance de cisions elevate s the risk of er ror. Cer tainly , the simpler the question, the lower the risk of er

roneous de cision. Mitchell v. W.T. Grant Co., 416 U.S. 600, 609 (1974). And the mor e " highly

fa c tua l" a

qu e sti on , th e g re ate r t

he ri sk of e rr on e ou s d e c isi on . D oe hr , 5 01 U. S. at 8. B ut at the same time, c ourts often de fer to ag encie s' highly

technica l decisions, revie wing such dec isions only

on an " arbitra

ry and ca pricious" standard. See Thomas J eff erson Univ. v. Shalala, 512 U.S. 504, 512 (1994). B eca use the de cision to issue a UAO is both fa ctual and technica l, this abstract principle ne ither helps nor hur ts GE' s case . S t i l l o th e r a b s tr a c tp r i n c i p l e s s u g g e s tth atE P A ' s p r o c e s s i s n o te r r o r - p r o n e . M o s tn o t a

b l y, repr esentation by

counsel duringthe pre -dec isional process sha rply reduc es the risk of e rror . See Reeve Aleutian, 982 F .2d at 600. PRP s may be and usua lly

are repr esente d by

counsel in pre
UAO issuanc e neg otiations with EP A. EPA SOF at ¶¶ 21-22. This is, in the Court' s view, of g re at si g nif

ic anc e . T he re fo re , a lth ou g h s e ve ra l a sp e c ts o f t he pr e -UAO iss ua

nc e pr oc e ss s ug g e st, in t he a bs tr a c t, a high r isk of e rr or , o the rs su g g e st n e ith e r a high n or a low ri sk of e rr or , a nd sti ll others sug g est a low risk of e rror .Un ite d St ate s v . B ur lin g ton N. R.R . Co ., 20 0 F .3 d 6 79 (1 0th Cir . 1 99 9) ; In r e B e ll 18 Petroleum Servs., Inc., 3 F .3d 889 (5th Cir. 1993); United States v. Ottati & G oss, I nc., 900 F .2d 429 (1st Cir. 1990); United States v. B & D Elec ., Inc., No. Civ.A.05-0063, 2007 WL1395468 (E.D. Mo. May

9, 2007); United States v. B roder ick Inv. Co., 963 F. Supp. 951 (D. Colo. 1997); United States v. Wedzeb Enters., Inc., 844 F . Supp. 1328 (S.D. I nd. 1994); and United States v. Har dag e, 663 F . Supp. 1280 (W.D. Okla. 1987). -45- b. Concrete Evidence Over laid on this abstract a ssessment of the risk of e rror is the voluminous empirical rec ord i nth i s ca s e. GE p o i n t s t o fo ur c at ego ri es o f e v i d en ce dra wn fr o mth atre co rdt o ar gu e t h atE P A's pr oc e ss i n f

a c t r e su lts in e rr or s in

iss uin gUA Os . F ir st, GE pr of fe rs c a se s d e mon str atin gthat E PA
make s mi sta

ke s in oth e r, no n- UA O c on te xts. N e xt, G E p ro vid e s a n e xpe rt re po rt fr om D r. Ki p Viscusi, who examines whether EPA' s remedy

selec tion is erroneous unde r a c ost-benef it, cance rpr e ve nti on

sta nd ard . T hir d, GE re lie s o n d e c laratio ns c ata log ingthe e xpe ri e nc e s o f s e ve ra l PRPs , including some sites where GE itself wa s issued a UAO . Finally , GE provides e vidence from
re imb ur se me nt p ro c e e din g s f ile d b y c omp lyingPRPs a g a ins t th e g ov e rnme nt. The c ases de monstrating that EPA has made mistakes in other CERCL A contexts are not informative a s to EPA's rate of e rror in issuing UAOs. G E cites to seve n case s. But none 18 inv olv e UA Os . Rathe r, the y me re ly de mon str ate tha

t E PA h a s ma de so me mis take s in administeringother sec tions of CERC L A. That EPA make s some mistakes is unsurprising; e very
a g e nc y , e sp e c ia lly

on e a s la rg e a s E PA, make s mi sta

ke s. Th e APA ' s " arb itr ary and c a pr ic iou s" standard f or the re view of a g ency

action anticipates that some ag ency err ors will not warra

nt jud ic ia l r e ve rs a l. A ll that c ourt s c an e xpe c t is tha t a g e nc y pr oc e dure s " a c hie ve an a c c e pta ble rate of er ror." See Califano v. B oles, 443 U.S. 282, 285 (1979). Eve n if these se ven ca ses wer e rele vant to deter

mining EPA' s rate of

err or in issuing UA Os -- which they are not -- the Court hasInd e e d, GE ' s c ouns e l in dic ate d at th e mot ion s h e ari ngthat D r. Vi sc us i' s r e po rt is 19 primarily intended to show that political fac tors influence EPA' s decision-makingproce ss, not that EPA in fact make s err ors in issuing UAO s. See Tr. at 46; see also GE SUF at ¶¶ 68- 69. Dec laration of Richard Kr ablin; Decla ration of John Bake r; Dec laration of Daniel 20 Uy esato; De clar ation of Randall McA lister; and Supplemental Dec laration of Randall McAlister. The Gr and Stree t Mercur y Superfund site; the F letcher ' s Paint W orks site; the forme r 21 GE e le c tr ic a l tr ans fo rm e r m anu fa c tur ingfa c ili ty in R ome , G a . ( " Rom e sit e " ); the Ve g a Al ta Superfund site; the Solvent Savers Super fund site; the L i Tung sten site; the Woolfolk C hemical Works sit e; the He ring ton Army Airfield site; and the Palmerton Z inc Pile Superfund site.

-46- no c on te xt wh atso e ve r t o d e te rm ine wh at ki nd of " rate of e rr or " the se se ve n c a se s r e fl e c t. T h e e x p ertre p o rtfr o mDr
. Vi s cu s i i s s i m i l ar l y un h el p fu l
. Dr
. Vi s cu s i ex am i n edE P A's

19
c le an- up e ff

or ts und e r C ERC L A f

ro m 19 93 to 1 99 9 to ana ly ze whe the r E PA e ff

e c tiv e ly pr e ve nts
c anc e r f ro m a c os t- be ne fi t pe rs pe c tiv e . V isc us i Re po rt at ¶ ¶ 7 , 1 0- 13 . B ut D r. Vi sc us i' s r e po rt is
at on c e too br oa d a

nd too na rr ow . H is r e po rt

is t oo br oa d b e c a

us e it e xami ne s E PA' s o ve ra ll
a dmi nis tr atio n o f C ERC L A. Ev e n if Dr . V isc us i' s st

ud y re ve a ls that E PA m ake s e rr or s in its
ov e ra ll a dmi nis tr atio n o f C ERC L A, tha t do e s n ot s ho w that E PA e rr s in iss uin gUA Os be c a

us e Dr. Viscusi did not conduc t a UAO- specific analy sis. The repor t is too narrow be cause it focuses
on ly on c anc e r p re ve nti on

and c os t- be ne fi t ana ly sis -- jus t tw o o f t he nin e fa c tor s E PA m

us t consider in se lectinga re medy . See 40 C.F.R. § 300.430(e )(9) (iii); see a lso Ohio v. EPA, 997 F.2d 1520, 1531 ( D.C. Cir. 1993) (noting that cost is give n less weig ht in remedy selec tion than some of the other

nine fa ctors). Whateve r we ight Dr . Viscusi' s repor t may have c olloquially

or po lit ic a lly , it

is o f l itt le va lue in a sse ssi ngwh e the r E PA' s c ur re nt a dmi nis tr ativ e pr oc e ss err oneously

deprive s PRP s of protec ted prope rty interests by

issuing UAO s. GE' s best evidenc e is in its declarations. I n five de clar ations, GE desc ribes nine sites 20 21 wher e EPA supposedly

err ed in issuing a

UAO. F ive of these sites do not advance GE' s case . For-47-

the L i Tung sten site, the Gra nd Street Mer cury

site, the Fle tcher ' s Paint W orks site, the He ring ton Ar my Ai rf ie ld s ite , a

nd the Woo lf

olk Che mic a l Wor

ks sit e , th e de c lara

nts pr ov ide on ly

the ir
un su bs tanti ate d a sse rt ion s th at a UA O e ith e r w a s is su e d to the wr on gPRP o r c on ta ine d s ome improper r emedy . For

the Fle tcher ' s Paint W orks site, for e x ample, Randa ll McAlister, a GE Senior Prog ram Mana g er, state s that GE was unf airly targ eted a

nd that EPA selecte d an improper
reme dy . See McA lister Dec l. ¶¶ 69-98. Without some independent ver ification that EPA in fac t
ma de e rr or s in

iss uin ga UA O t o G E at th e F le tc he r' s Pa int Wor ks sit e , M c Al ist e r' s d e c lara tio n is self-se rvingand uncor

roborated. Such dec larations are of littl e value at the summary judgme nt stag e, see Tolson v. J ames, 315 F . Supp. 2d 110, 116 (D.D.C. 2004), and c erta inly do not repr esent c oncre te evidenc e esta blishing an una cce ptable risk of e rror in the section 106 UAO pr oc e ss. The re maining f

our sites do offe r some support for GE' s case . GE has de monstrated that EPA' s initi al re medy

selec tion at two sites was err oneous. At the Ve g a Alta site, GE took issue with an EPA-propose d reme dy to clean up the site. Supp. McAlister Dec l. ¶¶ 18-19. G E p ro p o s edi t s o wn re m ed y , an d E P A e v en tu al l y

wi th dre w i t s p re v i o u s re m ed y an d ad o p t edGE 's
a pp ro a c h. I d. ¶¶

22 -2 3. Simi larl y , at th e Sol ve nt S ave rs sit e , E PA r e pla c e d it s in iti a l r e me dy wi th a PRP-selected one afte r the PRPs demonstrated that EPA' s initi al re medy was inef ficient. I d. ¶¶ 30-36. At two other sites, GE has shown that EPA er roneously issued a UAO . At the Rome site, GE wa s issued a UAO even though GE had ne g otiated a c lean- up plan with state environme ntal officia ls under the Resour ce Conser vation and Rec overy

Act (" RCRA" ), 42 U.S.C. § 6901 et seq. McAlister De cl. ¶ 134. GE w as able to seek re view throug h RCRA, and EPA withdre w the UAO be fo re the c ourt

c ou ld a c t. I d. ¶¶

14 6, 14 8. At

the Pa lme rt on

Z inc Pile sit e , H or se he a d Ind us tr ie s,-48-

another PRP , was issued a

UAO to cle an up a site that Horsehe ad had ne ver owned or ope rate d. Kra blin Decl. ¶¶

18-21. Horse head w as able to obtain reviewbeca use of a para llel cost rec overy action. I d. ¶ 29. The c ourt eve ntually issued a conse nt order pr eliminarily enjoining e nforc ement of the UA O ag ainst Horsehe ad. I d. ¶ 31. GE 's ev i d en ce fr o mre i mb urs em en tp ro ce ed i n gs i s re v ea l i n g b u td o es n o tad v an ce GE 's position. Under sec tion 106(b)(2), PRPs may seek r eimbursement upon c ompletion of the cleanup if they believe that they

have be en issued a UAO in er ror. I f EPA re fuses to re imburse the PRP, the n th e PRP ma

y fi le su it i n a

fe de ra l di str ic t c ourt , whe re the PRP c an c ha lle ng e bo th liability and re medy

selec tion. See 42 U.S.C. §§ 9606(b)(2)( C)-(D) . Given that thousands of PRPs h ave c omp lie d w ithUA Os , r e imb ur se me nt p ro c e e din g s w ou ld a pp e ar t o b e the mos t f

e rt ile g ro un d f or fi nd ingEPAe rr or . B ut G E c on c e de s th at " the re ha s o nly be e n o ne Se c tio n 1 06 (b ) c a se that has re sulted in a final judg ment adver se to EPA requiringreimburse ment from the g overnme nt." GE SUF at ¶ 154. At the summary

judgme nt stag e, the pa

ucity of evide nce of

err or from re imbursement proc eeding s is telling. See Celotex, 477 U.S. at 322. In sum, when all four

cate g ories of e vidence proff ere d by GE ar e ca

ref ully scrutinized, GE h as p o i n t edt o j u s tfi v e i n s t an ce s o f e rr o r - - f o ur e x am p l es fr o ms p ec i fi c s i t es d es cr i b edi nGE 's decla rations and one example of a c omply ing PRP successf ully obtaining r eimbursement f rom the g overnme nt. EPA has issued 1,705 UAOs to more tha n 5,400 PRP s since 1982. See Rouha ni Re po rt at ¶ ¶ 4 .3 , 6 .5 .2 . I f G E w e re atte mpt ingto p re se nt a n e xha us tiv e lis t of

EPA ' s e rr or s in issuing UAO s, this would represe nt a minuscule er ror r ate. B ut even if G E is not presentingan e xha us tiv e lis t of

EPA ' s e rr or s f

or a ll PRPs, the Court

c an p re sume tha

t G E h a s at le a st t

ho ro ug hly surveyed all 68 of the UAOs that GE itself ha s been issued. I n the evidenc e pre sented, GE ha sTh os e are a lle g e d e rr or s at th e Ve g a Al ta sit e , th e Sol ve nt S ave rs sit e , a nd the Rom e 22 site. -49- demonstrated that EPA has made only three err ors in issuing those 68 UAO s -- a n err or rate of 22 4. 4 p e rc e nt. Al tho ug h n ot i ns ig nif ic ant, 4. 4 p e rc e nt i s a

n " a c c e pta

ble rate of

e rr or " fo r E PA i n issuing UAO s under se ction 106 of CERCL A. See Shands, 602 F .2d at 1160 (holdingthat a four perc ent er ror r ate c onstitut es " substantial compliance" with a statute); see also Humphries v. County of L os Ang eles, Civ.A.No. 05-56467, 2008 WL4791868 at *20 (9th Cir. Nov. 5, 2008) (holding that a 50 per cent e rror rate would constitute a substantial risk of er roneous de privation); Du puy v. Samue ls, 39 7 F .3 d 4 93 , 5 05 , 5 12 (7 th C ir . 2 00 5) (h old ingthat a 74 .6 pe rc e nt e rr or

rate is unacc eptably

high) . And g iven the size of the re cord a fter se vera l y ear s of exhaustive discovery , the pauc ity

of evide nce de monstrating a highe r rate of e rror

for a ll PR Ps casts doubt on
a ssumin gan e rr or

rate e ve n a s h ig h a s f

our p e rc e nt. 4. Ba lancing Havingidentified the private intere sts, gove rnment intere sts and risk of er ror, the f inal step in this due process a ssessment is to balance these fa ctors ag ainst one anothe r. See Mathews, 424 U.S. at 334. The ba lancingproce ss is dy namic -- for e x ample, while greater proc ess could re duce the ri sk of e rr or , it a lso a dd s c os t and

de lay , th e re by

burd e nin gbo th g ov e rnme nt a nd pr ivate interests. He re, G E has stated a pref ere nce f or a f ull judicial hearing . See Tr. at 9:8-10:1. But
c o urt s s e l d o mi mp o rtth e f u l l j u d i c i a l m o d e l i n t o th e a dm i n i s tr at i v e d e c i s i o n - m ak i n gp r o c e s s . In lie u o f a fu ll j ud ic ia l he ari ng , G E h a s st ate d th at th e ke y ingre die nt f

or the a dd iti on a l pr oc e ss i t thinks necessa

ry is a neutra l decision-make r. See id. As discusse d above, c ourts have e ndorsed both AL J s, see Rosen, 735 F .2d at 570, and de tache d "pr esiding office rs" within an ag ency , seeI f n e ith e r a pr e sid inga g e nc y

of fi c e r n or an A L J as a

ne utr a l de c isi on -m ake r i s 23 c on sti tut ion a lly

re qu ir e d f

or the se c tio n 1 06 UA O p re -i ssu a nc e pr oc e ss, the n th e su

bs tanti a lly more burde nsome full judicial hear ing w ould not be nece ssary either. -50- Chemical Waste, 873 F.2d a t 1485, as ade quate ne utral dec ision-makers. The ref ore, the Court
w i l l un d e rt ak e th e M ath e w s b a l an c i n gt o d e t e r m i n e w h e th e r

ana g e n c y

p r e s i d i n go f

f i c e r o r anA LJ i s c o n s t i tu t i o n a l l y n e c e s s ar y. 23 The pre cise nature of the interests at stake is worth repe ating . The private intere st depends on whether

or not a PRP complies. I f the PRP complies, then the aver ag e costs of c ompliance a re $ 4 m i l l i o nan d

th e d e p r i v at i o nl a s t s f

o r anav e r a g e o f

th r e e ye ar s . If

th e P R P d o e s n o tc o mp l y, then the ave rag e size and leng th of the depr ivation are substantial but unclear . And whethe r or not a PRP compli es, the de privations are primarily financ ial, althoug h for some PRPs the financial deprivations are suff

iciently larg e to have collater al ef fec ts on operations. As for the g overnme nt int e re st, EPAdo e s n ot i ssu e UA Os in e me rg e nc y sit uatio ns . B ut E PA n on e the le ss h a s a substantial financia l and administrative intere st. Bec ause U AOs ar e issued fr equently , even minimal additional process would tax EPA's re source s. Finally , the risk of e rror -- a s repr esente d throug h the ac tual rate of er ror ove r many

y ear s in this pattern and pra ctice c ase - - is low. GE has provided c oncre te evidenc e to establish that EPA has made err ors in issuing five UAOs, including three UAOs issued to GE itself. Assumingthat GE has plumbed f or er ror a ll 68 of the UAOs that it has rec eived, a

nd assuming that GE' s experience is repre sentative, EPA make s some sort of
e rr or in r ou g hly

fo ur pe rc e nt o f i ts U AO s. The Court will first consider whether a pre -issuance hear ing be fore a pre siding off icer wi thi n E PA w ou ld s o r e du c e the ri sk of e rr or , w ith out un du ly

burd e nin gthe g ov e rnme nt i nte re st, as to be c onstitut ionally

require d. At first g lance , the burde n on the g overnme nt interest appe ars-51-

minimal. For any

g iven UAO, a

hear ing be fore a pre siding off icer would add only

wee ks or a f

ew months to an issuance proc ess that usually takes year s. See Rouhani Report at ¶ 6.1.3. Moreove r, th e c o s ts o f

a s in g le h e ar in gb e f

o r e a p r e s id in go f

f ic e r ar e mi n im a l, e s p e c ia ll y

c o n s id e r in gth e s iz e of the private intere sts at stake. B ut the Court may not examine the burden on the g overnme nt at such a granula

r leve l. See Gra

y Panthers v. Califano, 466 F . Supp. 1317, 1324 (D.D.C. 1979), rev' d on other g rounds sub nom. Gray Panthers v. Schwe iker, 652 F .2d 146 (D.C. Cir. 1980). Rathe r, the Court

mus t c on sid e r t

he c umu lativ e e ff

e c t of the a dd iti on a l pr oc e ss. I d. As pr e vio us ly discussed, EPA issued 1,705 UAOs to more than 5,400 PRP s in the 285 months from Aug ust 16, 19 82 to M ay

25 , 2 00 6. Se e Rouha

ni R e po rt at ¶ ¶ 4 .3 , 6 .5 .2 . T hat is a

ra te of six U AO s is su e d to nineteen PRPs every

month. Bec ause U AOs ar e norma lly only issued at the conc lusion of an extended neg otiation period, many (if not all) PRPs would l ikely invoke the opportunity

for a hear ing be fore a pre siding off icer . In the ag g reg ate, then, the require ment of a pr esiding office r would cer tainly constitute a substantial financ ial and administrative c ost to the gove rnment. On the other

hand, a pr e-de cision hear ing by an ag ency

presidingoffice r would not signific antly

reduc e the r isk of err or. As demonstrated in this pattern and pr actice case by the low rate of er ror, the r isk of err or is alre ady very small. The cost of a dditional process must indeed be minimal to j ustify

addingto a proc ess that alre ady results in an ac cepta

bly low risk of er

ror. See Tillman v. L ebanon Cty . Correc tional Fac ility , 221 F.3d 410, 422 ( 3d Cir. 2000). Howe ver, a s discussed above , the cost of a presidingoffice r is not as minimal as it mi g ht initi ally appea r. Finally , the size and nature of the private intere sts of the PRP are not so gr eat a s to justi fy incre ased g overnme nt costs with only a mar g inal improvement in the rate of e rror . Although the privates inter est are signific ant, GE ha s not demonstrated that the pr imarily financ ial interests at-52-

stake he re r outinely

have suc h collater al ef

fec ts as to constitute a " brutal nee d" r equiringg reater pre- deprivation process. See Arne tt v. Kennedy , 416 U.S. 134, 169 (1974). More over, a ny benef it to thos e private financ ial interests would be of fset somewhat by

the additional costs of the
e nh anc e d p re -i ssu anc e pr oc e ss - - f ull a dv e rs ari a l he ari ng s w ithle g a l r e pr e se ntatio n, e ve n if jus t befor e an a g ency

officia l, are expensive. Henc e, bec ause the benef it of additional proce ss is low and the c ost of that proce ss is fairly high, the Court finds that a hea ringbefor e a pr esiding office r i s n o tc o n s t i tu t i o n a l l y n e c e s s ar y. This result does not cha

ng e whe n the pre -issuance hear ing is be fore an AL J rathe r than a presidingoffice r. The Court' s weig hing of the private interests re mains unchang ed. The ty pe of hear ing doe s not impact the size and nature of the de privation. Nor would the impac t of a he aring befor e an A L J chang e the Court' s rate of err or ana ly sis. I t is hard to reduc e the r ate of err or whe n it is very low to beg in with. Only

the ana ly sis of the g overnme nt interest cha ng es whe n consideringa hea

ringbefor e an A L J instead of a presidingoffice r. B ut a pre -issuance hear ing befor e an A L J would incre ase the burden on the g overnme nt interest. Hea ring s befor e an A L J are more for mal and have more of the trapping s of the judicial proc ess than informa l hear ings be fore a pre siding off

icer . Hea ring s befor e an A L J would undoubtedly be leng thier and more timec o n s u m i n g . B e c a

u s e th e s e h e ar i n g s f

r e qu e n t l y w o u l d b e i n v o k e d

b y P R P s , r e qu i r i n ganA LJ would constitute an eve n g reater fina ncial and a dminist rative c ost to the gove rnment than a hear ing be fore a pre siding off icer . Ba sed on the ba lancingof these f actor s, then, the Court conclude s that the Constit ution does not require a pre -issuance hear ing be fore an AL J either. In summary , althoug h GE has pr esente d evidenc e of isolated e rror s by EPA, such infreque nt error s -- c onstitut ing a rea sonably

low overa ll risk of err or -- do not warr ant the-53-

swee ping c hang es GE r equests. Err ors should be addr essed by a PRP when they

occur -- e ither by not complying w ith a UAO a nd defe nding a

subsequent enf

orce ment proce edingor by complying wi th a UA O a nd se e kin gpo st- c omp le tio n r e imb ur se me nt. Th os e ave nu e s r e ma in a va ila ble to PRP s under CERCL A as a more e ffe ctive mea

ns to address the oc casiona l error s reve aled by the
rec ord bef

ore this Court. To the extent that GE continues to believe that EPA g ener ally overuse s or abuse s UAOs, ther eby

oversteppingits mandate, any broade r re medy

should be soug ht from Con g re ss, no t th e c ou

rt s. CO NC LU SION In th e ir mot ion s f

or summa ry jud g me nt, GE and

EPAfo c us on

tw o d ue pr oc e ss arguments: unconstituti onal coe rcion unde r Ex parte Youngand unconstitutional deprivation of proper ty or liberty under Mathews v. Eldridg e. F or the re asons explained above, a nd based on the
e xten siv e re c or d d e ve lop e d thro ugh ye ars of dis c ov e ry , th e Court

a g re e s w ithEPAon

bo th p oints and conc ludes that GE has not shown that EPA' s pattern a nd prac tice of a dminist eringsection 106 of CERCL A violates due pr ocess. The ref ore, G E' s motion for summary judgme nt is denied and EPA' s motion for summary judgme nt is gra

nted. A sepa

rate order has bee n issued on this date.

/s/ JohnD. B ate s J OHN D. B ATES Un i t edS t at es Di s tri ctJ u d ge Dated: January

27, 2009