U.S. Supreme Court Allows to Stand Ruling That Sources of Air Pollutants are Subject to State Common Law Tort Claims

by Latham & Watkins LLP
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On June 2, 2014, the U.S. Supreme Court announced it would not review a decision by the Court of Appeals for the Third Circuit allowing state common law tort claims against sources of air pollutants.  This spells uncertainty for emitters, who now must look beyond the requirements in their facility permits in contending with local tort law.  Even if they are in full compliance with the Clean Air Act (CAA), sources—including fossil fuel-fired power plants, petroleum refineries, and emitters of greenhouse gases (GHGs)—may be faced with claims that their emissions constitute a nuisance or trespass. 

The Supreme Court declined to grant certiorari to a petition requesting review of the Third Circuit’s decision in Bell v. Cheswick Generating Station.  Named plaintiff Kristie Bell and more than 1,500 residents of Springdale, Pennsylvania filed a class action complaint in April 2012 against the Cheswick Generating Station, a 570 megawatt coal-fired power plant in Springdale.  The class claims that the plant emits harmful and noxious odors and particulate matter, including fly ash and coal combustion byproducts, and that the odors and particulate matter cause property damage and make the residents “prisoners in their own homes.”  The suit alleges a number of theories under Pennsylvania tort law, including nuisance, negligence, recklessness, and trespass. 

The plant operator prevailed at trial in the District Court for the Western District of Pennsylvania, which found that “permit[ting] the [residents’] common law claims would be inconsistent with the dictates of the Clean Air Act,” and therefore any state law tort claims concerning air emissions from the power plant are preempted by the federal CAA.  The district court reasoned that the residents’ state law tort claims would impermissibly interfere with the federal CAA’s comprehensive regulatory system.  Further, the court found that because the CAA already allows for citizen suits to enforce compliance with CAA requirements, allowing state tort claims would be an unnecessary “parallel track.” 

The Third Circuit, however, disagreed and reversed the district court’s ruling.  The Third Circuit found that allowing state law tort claims is consistent with Supreme Court precedent, that Congress did not evince an intent to preempt state law tort claims, and that such claims would not disrupt the regulatory scheme set out by the CAA. 

The plant operator argued to the Third Circuit and in its petition to the Supreme Court for certiorari that the CAA preempts state law tort claims. The plant operator relied heavily on American Electric Power Co. v. Connecticut (AEP), a 2011 Supreme Court decision holding that the CAA displaces federal common law tort claims concerning GHG emissions from power plants.  AEP left open the question of whether, in addition to displacing the federal common law, the CAA preempts state law tort claims concerning air emissions.  Noting that “legislative displacement of federal common law does not require the same sort of clear and manifest congressional purpose demanded for preemption of state law,” the Third Circuit rejected the power plant operator’s argument that AEP is dispositive.

The Third Circuit then turned to the question of whether Congress intended for the CAA to preempt state common law tort claims.  The Third Circuit found nothing in the CAA indicating congressional intent to do so.  The power plant operator argued to the Third Circuit and the Supreme Court that the CAA is a comprehensive regulatory program designed to produce uniform and predictable standards, and it would defeat the CAA’s purpose if CAA-compliant plants were also subject to various state law nuisance requirements.  In doing so, the plant operator was forced to distinguish International Paper Co. v. Ouellette, in which the Supreme Court held that the Clean Water Act (CWA) does not preempt certain state common law tort claims against dischargers.  The power plant operator argued that the CWA has a more robust savings clause than the CAA and that while the CWA’s savings clause preserves certain state common law tort claims concerning discharges to water, the CAA’s savings clause does not preserve any state common law tort claims concerning emissions to air.

The Third Circuit sided with the residents.  The court held that there is “no meaningful difference between the Clean Water Act and the Clean Air Act for the purposes of our preemption analysis.”  Thus, the CAA, like the CWA, preserves state common law tort claims, with one important caveat: the claims must be made under the law of the state where the emitter is located.  The Third Circuit explained that subjecting plants to only their home state’s nuisance laws would ensure that such state law tort suits would not unduly complicate the CAA’s comprehensive regulatory system because plants would only have to look to one additional authority—their home state’s laws—to determine the applicable standards. 

The Third Circuit also rejected the plant operator’s argument that pollution control was a political question that is not for the judiciary branch to decide.  The plant operator argued that the CAA requires careful balancing of environmental costs and economic benefits, and such policy decisions are best left exclusively to the legislative branch. The court disagreed with this argument, stating that courts have often heard suits addressing property damages from air emissions. 

The power plant operator’s petition to the Supreme Court reiterated the same arguments it made before the Third Circuit, including the arguments that AEP effectively eliminates state common law air emission suits and that the CAA leaves no room for and would be disrupted by such suits.  The operator further argued that the Third Circuit’s decision would hinder the predictability of emission requirements, trigger a deluge of lawsuits, have a negative economic impact on the energy industry, and promote inefficient stop-gap pollution control.  The Supreme Court denied the petition on June 2 without comment. 

The Supreme Court’s denial of review of the Third Circuit’s decision means that Bell v. Cheswick Generating Station is binding law for power plants and other emitters in Delaware, New Jersey, and Pennsylvania.  Courts in other jurisdictions may also find the decision to be persuasive authority.  Practically speaking, compliance with the CAA is necessary but not sufficient.  On top of this base requirement of complying with the CAA and permits issued under it, sources must also look to the standards of their home state’s tort law, particularly prohibitions against creating a public nuisance.  In short, CAA compliance cannot be used as a safe harbor defense against state common law tort claims.  

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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