Law
3:20 pm
Mon June 9, 2014

Supreme Court Rules Against Homeowners In Superfund Case

The U.S. Supreme Court ruled Monday that a federal law seeking to improve accountability for environmental spills and pollution can be circumvented by certain kinds of state laws.

The federal Superfund law supersedes state statutes of limitations. Instead the federal law dictates that lawsuits alleging environmental injury need only be filed when individuals either first learn or should have learned that they have been harmed. But what the court gave with one hand, it took away with the other, ruling that rare state statutes of another sort can limit lawsuits in a different way.

The case before the court arose in 2009, when a group of landowners in Asheville, N.C., suffering an array of serious health problems — from cancer to pregnancy complications — discovered that the company that used the land in the 1970s and 1980s contaminated their water supply with toxic solvents. The company did not disclose those facts when selling the parcels to individuals in 1987.

Writing for a seven-justice majority, Justice Anthony Kennedy said that the state statute of limitations is trumped by federal law. However, North Carolina has a state law releasing companies from all liability after 10 years. That law, called a statue of repose, is a different animal, he said.

By allowing states to set limits on liability, Kennedy conceded, the court has effectively agreed that some victims may never be able to sue. The landowners in the North Carolina case, for example, did not know about the pollution or begin to suffer the ill effects of their exposure until after the 10-year window expired.

Although Congress could amend federal environmental legislation to prevent states from blocking suits, most doubt that it will do so. "I don't foresee Congress passing an amendment any time soon," says Richard O. Faulk, Senior Director of Energy and Environment Initiatives at the Law & Economics Center at George Mason University School of Law. Faulk, who celebrated the Court's decision, suggests that any attempt to amend the federal legislation would be split along partisan lines in the current Congress.

Environmental activist Erin Brockovich, whose 1993 investigation of groundwater contamination in Hinkley, Calif., led to a record-breaking $333 million settlement between town residents and polluter Pacific Gas & Electric (PG&E), was portrayed in the 2000 movie, Erin Brockovich. She plans to push for an amendment to prevent states from limiting suits altogether, although she does not expect to succeed.

"Not in this Congress," Brockovich says, "but maybe in the new one." If it had come earlier, the Court's decision could have affected her own now-famous case, she notes: PG&E's pollution took place in the 1960s and remained secret until the early 1990s.

Congress may not act, but states almost certainly will. Currently just four states have statutes of repose in addition to statutes of limitation: Connecticut, Kansas, North Carolina, and Oregon. But, as Faulk predicts, "It's likely that someone will probably seek to pass statutes to cut off open-ended liability."

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