The Nickel Report

On February 7, 2018, US Environmental Protection Agency (EPA) Administrator Scott Pruitt signed a proposed rule to establish user fees to defray EPA’s costs of administering its responsibilities under the Toxic Substances Control Act (TSCA), as amended by the 2016 Frank Lautenberg Chemical Safety for the 21^st Century Act (Lautenberg Act). EPA estimates in the proposed rule that it will collect about $20.05 million per year in user fees, not counting any user fees associated with manufacturer-requested risk evaluations, which would range from $1.3 million to $2.6 million per evaluation.

A New Jersey court recently held that an electrical products manufacturer was entitled to coverage rights provided by a predecessor’s commercial general liability policies if it was found liable for environmental remediation costs as a result of cleanup efforts by the US Environmental Protection Agency (EPA) along a 17-mile portion of the Passaic River in New Jersey.

New chemicals of concern, new scientific and technical developments, newly discovered wastes, or natural disasters can add up to new CERCLA liabilities. When the Comprehensive Environmental Response Compensation and Liability Act (“CERCLA”) was passed in 1980, it did not address the finality of judgments and settlements for the cleanup of contaminated sites. Some early settlements with EPA provided a complete release from all future CERCLA liability, but that later changed when the United States Environmental Protection Agency (“EPA”) began to limit the scope of covenants not to sue to specified “matters covered” by the settlement. The 1986 CERCLA amendments in section 122(f)(6), 42 U.S.C. § 9622(f)(6)(1) permanently made the change to require “reopeners” in all but a few limited circumstances.

The stakes are high for anyone facing environmental liability in the wake of superstorms like Hurricanes Katrina, Sandy, Harvey, Irma, and Maria. If you are among the parties potentially liable for the costs to clean up a release of oil or hazardous substances caused by a major storm event, you may be thinking about a possible “act of God” defense.  You may want to think again. In practice, the availability of this defense has proved elusive.  It is still a good idea, however,  to minimize risk in planning for the next “big one.”  Ultimately, advance actions taken to avoid or mitigate the impacts of natural disasters may be the difference between being excused from or being saddled with cleanup liability.

Environmental groups are raising the stakes for power companies facing allegations of coal-ash liability. Power plants that burn coal to produce electricity also create byproducts in the process, known as “coal combustion residuals,” or CCRs. CCRs go by several names, but are commonly known as “coal ash.”

Historically, power companies have stored CCRs in settling ponds, also known as “coal-ash basins.” Coal-ash storage and disposal can lead to allegations of groundwater contamination and environmental contamination claims. Environmental groups have sought to require companies to pay for remediation of disposal sites and alleged groundwater contamination; address alleged natural resource damages; and conduct extensive monitoring and sampling of onsite and offsite sediments, groundwater, fish, and other wildlife.