Opinion ID: 203878
Heading Depth: 3
Heading Rank: 2

Heading: Esso's Claim

Text: On June 12, 2007, the Commonwealth filed suit in the United States District Court for the District of Puerto Rico against various gasoline refiners and distributors, owners and operators of gasoline retail stations, and manufacturers of the gasoline additive methyl tertiary butyl ether (MTBE). The complaint alleges large-scale MTBE contamination of the waters of the Commonwealth, which it defines as all Class SG1 ground waters and all Class SD surface waters located on the main island. The Commonwealth asserts claims for: strict products liability for defective design and failure to warn; nuisance; trespass; negligence; violations of the Puerto Rico Public Policy Environmental Act, Water Pollution Control Act, and Underground Storage Tank Control Regulations; violations of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA); violations of the Toxic Substances Control Act; and, finally, violations of RCRA. The majority of the factual allegations in the complaint involve the defendants' liability for the use of MTBE as a gasoline additive; indeed, the complaint notes that MTBE contamination was likely to result from the normal and foreseeable storage, purchase, and use of gasoline within the Commonwealth. The Commonwealth avers that, in addition to producing gasoline containing MTBE, the defendants also knowingly promoted, marketed, and sold such gasoline in the Commonwealth despite their awareness that MTBE, a hazardous substance, would be released into the waters of the Commonwealth. The complaint seeks to recover damages to fund the identification and treatment of MTBE contaminated waters used for public and private drinking water and cover the costs of restoring those waters to their pre-discharge condition, as well as general compensation for injuries to the waters of the Commonwealth. Additionally, the Commonwealth requests injunctive relief compelling defendants to investigate and remediate existing contamination and to prevent further releases from their leaking underground storage tanks. The Commonwealth's RCRA claim specifically alleges violations of Rule 1102(A) and (B) of the Puerto Rico USTCR on the part of the Owner/Operator Defendants, which the complaint defines as those defendants who owned or operated gasoline service stations and/or underground storage tanks that have discharged gasoline containing MTBE. The claim seeks an order enforcing the Puerto Rico Underground Storage Tank regulations that would compel defendants to investigate and repair and/or properly close all storage tanks ... which are leaking or pose a significant risk of leaking to ensure they do not leak MTBE or MTBE-containing substances into the Commonwealth's soils, waters, and other natural resources, and to investigate, delineate, and remediate all soils, waters, and other natural resources impacted by MTBE originating from leading [USTs] ... so as to remove all detectable concentrations of MTBE. On October 4, 2007, Esso was added as a defendant in the Commonwealth action. However, the complaint categorizes Esso as a refiner/supplier defendant; i.e., as a party that refined, marketed, and/or otherwise supplied ... gasoline and/or other products containing MTBE that [it] knew or should have known would be delivered into the Commonwealth. The Commonwealth does not allege that Esso is an owner or operator of a service station or UST. The problem of MTBE contamination is not limited to the Commonwealth; indeed, the problem has a national scope: MTBE is at the center of hundreds of lawsuits involving standard toxic tort issuesproduct liability claims involving personal injury, nuisance and trespass actions alleging property devaluation, and putative class actions seeking medical monitoring and emotional distress. While defendants in these suits usually represent a small set of producers and distributors of MBTE, plaintiffs include states, municipalities, and individuals. Today, MTBE litigation is a cottage industry of its own, with a specialized bar and a small circle of experts. Douglas A. Henderson & Mary K. McLemore, MTBE: A Tale of Air, Water, and Civil Procedure, 19 Nat. Resources & Env't. 20, 20 (2004-2005). Because MTBE litigation is so prevalent, the Judicial Panel on Multidistrict Litigation has transferred a large number of actions raising similar allegations to the Southern District of New York for coordinated or consolidated pretrial proceedings. See 28 U.S.C. § 1407 (permitting transfer where civil actions involving one or more common questions of fact are pending in different districts). Judge Shira A. Scheindlin has now presided over MTBE cases for nearly a decade. On October 31, 2007, the Panel transferred the Commonwealth action to her court in the Southern District of New York; the transfer order indicated that it was the 152nd case to be so transferred. While Esso is correct that there may be some overlap between the Commonwealth's suit and the case at bar, we find this overlap insufficient to divest us of jurisdiction over this case. First, comparing the RCRA claims only, the two complaints involve different contaminants (MTBE as opposed to benzene and other petroleum-related hydrocarbons), a distinction which other cases have found significant. See, e.g., A-C Reorganization Trust v. E.I. DuPont de Nemours & Co., 968 F.Supp. 423, 431-32 (E.D.Wis.1997)(holding that a consent order issued by the EPA did not preclude a citizen suit under RCRA where that consent order 1) did not necessarily contemplate the remediation of potential groundwater contamination, as opposed to surface contamination; and 2) did not address contaminants other than arsenic, whereas the citizen suit alleged the presence of other contaminants); Frilling v. Village of Anna, 924 F.Supp. 821, 837-39 (S.D.Ohio 1996) (allowing citizen suit under Clean Water Act (CWA) to proceed where Consent Order entered in state civil enforcement action sought to require compliance with federal parameters for only two of the six pollutants which citizen plaintiffs alleged had exceeded allowable levels); see also Maryland Waste Coal. v. SCM Corporation, 616 F.Supp. 1474, 1484 (D.Md. 1985). Moreover, in its complaint in the SDNY, the Commonwealth even explains that the fate and transport of MTBE in the subsurface differs significantly from that of gasoline constituents that have historically been of environmental and/or toxicological concern, specifically the `BTEX compounds' (benzene, toluene, ethylbenzene, and xylene), compounds which are the subject of plaintiffs' complaint. This difference means that, even though both compounds are components of gasoline, the areas affected by MTBE and BTEX contamination could potentially be different and/or require different remedial measures in case of a leak from a UST. Additionally, it is not evident from the face of the Commonwealth's complaint that MTBE is a common diesel additive, whereas some of the allegations in the case at bar involve contamination resulting from an allegedly leaking diesel tank. The two complaints also allege distinct violations of Puerto Rico's USTCR. The complaint in this action alleges violations of Rules 501, 503, 601, 602(A), (B), 603(A), 604(A), (C), and 606(A)(1)(3). In contrast, the Commonwealth accuses all defendants with regulated facilities in the Commonwealth of violating Rule 1102(A), (B), and (D). Aside from the difference in the specific rules that the two complaints seek to enforce, the Commonwealth's RCRA action expressly implicates Esso in a different capacity than the instant action. The MTBE litigation names Esso as a refiner/supplier defendant that refined, marketed, and/or otherwise supplied ... gasoline and/or other products containing MTBE that each such Defendant knew or should have known would be delivered into the Commonwealth. The Commonwealth does not allege that Esso is one of the Owner/Operator Defendants whose alleged unlawful releases of MTBE-containing substances and failure to take appropriate precautions to prevent and/or control releases violated the UST Regulations. In this citizen suit, by contrast, Esso is named as the owner/operator of the USTs and alleged to be directly responsible for the contamination emanating from them. Furthermore, there is a question of scope. The Commonwealth's suit is intended to protect the waters of the Commonwealth generally, and seeks significant compensation for damage that MTBE has inflicted upon those waters. In this case, we are dealing with the potential contamination and clean-up of one particular property, which may or may not be affected by MTBE contamination. In our view, a suit against dozens of defendants seeking to remedy the harm caused throughout the Commonwealth by one contaminant is notably different than an action asking one particular defendant to clean up a number of different contaminants on a single private property. Finally, we are not persuaded by Esso's reference to potentially overlapping remedial obligations. Esso argues that plaintiffs' suit is barred in part because the abatement of the MTBE contamination alleged in the Commonwealth action would necessarily abate other gasoline constituents leaked into the same soil or groundwater. However, it is not apparent from the pleadings in the two cases that the remedial measures for the various types of contamination are consistent; indeed, the SDNY complaint specifically alleges a difference in the nature of MTBE pollution and the pollution of other gasoline constituents. If, however, the remedy is identical, then whichever action is resolved first will obviate the need for the performance of that remedy in the other action. Given the magnitude of the MTBE litigation, it is almost certain that this case, which concerns only one site and is proceeding on an expedited basis, will reach the remedy stage first, perhaps even before the massive discovery is completed in the MDL. Any potential clean-up that the court may require in this case will either 1) remove the gasoline contamination generally from the affected site, and therefore any MTBE that it may have contained, or 2) remove or remediate only the pollutants at issue in this litigation. In the first case, the Dolores Service Station will simply be one less site for Esso to remediate in the MTBE litigation; in the second, it will need to do the same kind of remediation with respect to the MTBE that it would have in the absence of this citizen suit. Therefore, the Commonwealth's continued prosecution of the SDNY action would not represent a waste of enforcement resources or a duplication of efforts, which is what Congress was trying to avoid with the preclusion provisions. Alternatively, in the event that the remedies somehow conflict, the parties are free to seek modification of the relevant injunction; there is no need, at this stage, to short circuit this suit on jurisdictional grounds. See, e.g., Me. People's Alliance v. Holtrachem Mfg. Co., LLC, No. CIV-00-69-B-C, 2001 WL 1602046, at  8 (D.Me. Dec.14, 2001) (Kravchuk, Mag. J.) (noting, in the context of a primary jurisdiction analysis, that on the state of the current record, the potential conflict between a regulatory decree and eventual court-ordered remediation was not so inherent and tangible so as to justify short circuiting this congressionally authorized citizen suit on primary jurisdiction grounds because, when and if this Court and the parties arrive[d] at a remedy phase, the conflict concern [could] be revisited). [4]