Opinion ID: 41387
Heading Depth: 1
Heading Rank: 5

Heading: claims pursuant to opa

Text: OPA provides that “[n]otwithstanding any other provision of law . . . each responsible party for a vessel or a facility from which oil is discharged . . . into or upon the navigable waters or 14 adjoining shorelines . . . is liable for the removal costs and damages specified in subsection (b) of this section that result from such incident.” 33 U.S.C. § 2702(a). Section 2702(b)(2)(B) allows recovery of “[d]amages for injury to, or economic losses resulting from destruction of real or personal property, which shall be recoverable by a claimant who owns or leases that property.” Section 2702(b)(2)(E) provides recovery of “[d]amages equal to the loss of profits or impairment of earning capacity due to the injury, destruction, or loss of real property, personal property or natural resources, which shall be recoverable by any claimant.” The district court concluded that the OPA claims were not ripe for summary judgment because the claims raised genuine issues of material fact and were outside the scope of discovery. Appellants argue that OPA is inapplicable. Further, they contend that if OPA were applicable, Claimants could not recover because they have sustained no physical damage to their property and their economic damages were not the direct result of property damaged by an OPA event. Claimants respond that OPA is applicable because the gaseous cargo was a propylene/propane mix and that OPA does not require that the injury result from direct contact with a hazardous substance. In order to recover under § 2702(b)(2)(B) a plaintiff must show that her property was damaged as a result of a release or threatened release of oil. Claimants have not raised an issue of fact as to whether the gaseous cargo caused damage to their property; accordingly, they are not entitled to recover under § 2702(b)(2)(B). This, however, does not end our inquiry because § 2702(b)(2)(E) allows a plaintiff to recover for economic losses resulting from damage to another’s property. See Ballard Shipping Co. v. Beach Shellfish, 32 F.3d 623, 631 (1st Cir.1994) (“The House Conference Report makes clear that, under section 2702(b)(2)(E), ‘[t]he claimant need not be the owner of the damaged property or resources to recover for lost profits or income.’” (alteration in original) (citing 15 H.R. Conf. Rep. No. 101-653, 101st Cong., 2d Sess. 103 (1990), U.S. Code Cong. & Admin. News 1990, p. 722.)). Contra In re Cleveland Tankers, Inc., 791 F. Supp. 669, 678-79 (E.D. Mich. 1992), (interpreting subsection (E) to require that the injury be to the claimant’s property). Accordingly, we must decide whether Claimants’ damages are recoverable under § 2702(b)(2)(E). Appellants contend that Claimants may not recover because the property damage was not caused by the gaseous cargo. Because we have not yet had occasion to consider this issue, we find the decision of the Fourth Circuit in Gatlin Oil Co. v. United States, 169 F.3d 207 (4th Cir. 1999), instructive. In Gatlin Oil, vandals opened some of Gatlin Oil’s above-ground fuel storage tanks causing an oil spill. Vapors from the oil ignited a fire that destroyed a warehouse, plant, inventory and other property. In order to prevent further discharge of oil, federal officials instructed Gatlin Oil to remove oil from storm ditches and surface waters and to take other preventative measures. Gatlin Oil presented a claim to the Oil Spill Liability Trust Fund for payment of uncompensated removal costs and damages, claiming damages resulting from the discharge of oil and the ensuing fire. The Coast Guard determined that Gatlin Oil’s damages were limited to those caused by the discharge and the measures ordered by the federal officials to prevent discharge. The court held that as a matter of law Gatlin Oil could not recover compensation for fire damage because the evidence did not establish that the fire caused the discharge of oil into navigable waters or posed a threat to do so, as required by section 2702(a). Gatlin Oil, 169 F.3d at 212. Claimants argue that Gatlin Oil is inapplicable because it involved a claim for recovery from the Oil Spill Liability Trust Fund, not a responsible party; however, the Fourth Circuit noted, “[t]he principal dispute between Gatlin and the Coast guard pertains to the damages that are compensable within the meaning of section 2702,” id. at 210. Indeed, the court stated, “We hold that the removal 16 costs and damages specified in section 2702(b) are those that result from a discharge of oil or from a substantial threat of a discharge of oil into navigable waters or the adjacent shoreline.” Id. at 211. We agree. Even assuming arguendo that OPA applies, none of the claimants has raised an issue of fact as to whether any property damage was caused by the pollution incident, i.e., the release of the gaseous cargo. A party is liable under OPA if, inter alia, the claimant’s damages “result from such incident,” i.e., the discharge or threatened discharge of oil. See 33 U.S.C. § 2702(a) (emphasis added); Gatlin Oil, 169 F.3d at 210-11 (“The Coast Guard has interpreted the Act to provide that only removal costs and damages that ‘result from such incident’ are compensible [sic].” (emphasis in original) (citing § 2702(a))). Any property damage upon which Claimants must rely to recover under § 2702(b)(2)(E) did not result from the discharge or threatened discharge of oil. Claimants have not raised an issue of fact as to whether their economic losses are due to damage to property resulting from the discharge of the gas. Therefore, Claimants cannot recover under OPA and the district court erred in denying Appellants’ motions for partial summary judgment.