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Taft's environmental attorneys practice in all facets of environmental law, including Superfund defense and negotiation, enforcement defense, cost-recovery for plaintiffs and defendants, criminal environmental defense, environmental insurance and toxic tort litigation, mold and sick building litigation, lawsuits involving environmental problems discovered as a result of real property transfers or mergers and acquisitions, Brownfields redevelopment, defense of claims of occupational exposures, and administrative proceedings before state and federal agencies. Taft's environmental lawyers also are regularly engaged in insurance disputes concerning environmental issues and agricultural issues involving CAFOs and CFOs. The purpose of this newsletter is to provide you with insights from our team that may be of interest to yours.

Burlington Northern Limits on "Arranger" Liability Bleed Into California Statutory Law      

Jayna M. Cacioppo 

jcacioppo@taftlaw.com 

(317) 713-3582

LinkedIn 

In 2009, the U.S. Supreme Court issued an opinion that fundamentally changed the scope of liability for "arrangers" under the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, ("CERCLA"). See Burlington Northern & Santa Fe Railway Co. v. United States, 556 U.S. 599 (2009). In the years since it was issued, a number of federal courts have applied the Burlington Northern holding, in varying degrees, to limit CERCLA liability. Recently, a federal district court in California used it to limit liability under a California statute with a CERCLA-like liability scheme. See City of Merced Redevelopment Agency v. Exxon Mobil Corp., 2015 WL 471672 (E.D. Cal. Feb. 4, 2015).

SCOTUS Rules That Interpretive Rules Issued by Administrative Agencies are not Subject to Public Notice and Comment      

Katherine Grgic   

kgrgic@taftlaw.com 

(317) 713-3508

LinkedIn 


On March 9, 2015, the United States Supreme Court determined that interpretive rules issued by federal agencies are not subject to notice-and-comment procedures under the APA. Perez v. Mortgage Bankers Ass'n, 135 S. Ct. 1199 (2015). The court held that the Paralyzed Veterans doctrine requiring agencies to undergo notice-and-comment rulemaking procedures for interpretations that "deviate[] significantly" from previous interpretations was "contrary to the clear text of the APA's rulemaking provisions, and it improperly imposes on agencies an obligation beyond the 'maximum procedural requirements' specified in the APA. . . ." Id. at 1206 (internal citations omitted).

Fracking Wins in a Close Decision: Ohio Supreme Court Strikes Down Local Oil and Gas Ordinances, but...      

Kim K. Burke  

kburke@taftlaw.com 

(513) 357-9369

LinkedIn 


On Feb. 17, 2015, the Ohio Supreme Court, in a 4-3 decision, struck down several local ordinances regulating oil and gas production on the grounds that these ordinances were preempted by comprehensive state law and that the Ohio Home Rule provisions to its constitution did not grant a right for local ordinances to intrude upon this regulated area. The court found in State ex. Rel. Morrison v. Beck Energy Corp., Slip Op. 2015-Ohio-485, that five ordinances enacted in 1980 and 1995 by the city of Munroe Falls are preempted by the provisions of the Ohio Constitution in Article II, Section 36, which vest in the General Assembly the power to pass laws providing for the "regulation of methods of mining, weighing, measuring and marketing coal, oil, gas and all other minerals."

Parent Corporation's Prior Assertions of Domination Create "Alter Ego" Scenario, Opens Door for Indirect Successor Liability Under CERCLA         

Julian Harrell  

jharrell@taftlaw.com 

(317) 713-3410

LinkedIn 


In Cyprus Amax Minerals Co. v. TCI Pacific Comm. Inc., No. 4:11-cv-00252-CVE-PJC (N.D. Ok., Feb. 2, 2015), the U.S. District Court for the Northern District of Oklahoma addressed a successor-in-interest issue in an environmental cleanup case where plaintiff Cyprus Amax Minerals Company ("Cyprus") sought contribution payments from defendant TCI Pacific Communications, Inc. ("Pacific"). The court examined Cyprus's claim that Pacific was the successor-in-interest to New Jersey Zinc Company ("N.J. Zinc") and that Tulsa Fuel and Management Company ("Tulsa") was a subsidiary of N.J. Zinc. Cyprus alleged that Tulsa was the alter ego of N.J. Zinc and that Pacific had assumed responsibility for N.J. Zinc's liabilities. Based on this argument, Cyprus sought to hold Pacific liable for environmental harms caused by one of Tulsa's smelting operations. As discussed in the article linked below, the court accepted Cyprus's alter ego argument; however, it did not actually determine Pacific's CERCLA liability.

Environmental Case with $3.4M Insurance Bad Faith Claim Affirmed on Appeal       

  Bill Wagner

William C. Wagner 

wwagner@taftlaw.com 

(317) 713-3614

LinkedIn 


After an insurer settled an environmental contamination case against its policyholder for $165,000, a jury awarded the policyholder $3.4 million for emotional distress and punitive damages due to unfair claims settlement practices by the insurer. The multi-million dollar verdict was recently affirmed on appeal. Indiana Insurance Company v. Demetre, Case No. 2013-CA-338 (Ky. Ct. App. Jan. 30, 2015).

Seventh Circuit Applies Indiana Choice of Law Rules to Deny Insurance Coverage for Contamination at an Indiana Manufacturing Facility   

Jeffrey D. Stemerick  

jstemerick@taftlaw.com 

(317) 713-3414  


Hoosier land owners sleep well at night knowing that they are insured against liability for environmental contamination because Indiana does not enforce the standard pollution exclusion clauses found in many insurance policies. State Automobile Mut. Ins. Co. v. Flexdar, Inc., 964 N.E.2d 845 (Ind. 2012); Am. States Ins. Co. v. Kiger, 662 N.E.2d 945 (Ind. 1996). However, just because an insured's contaminated site is located in Indiana does not necessarily mean that the pollution exclusion will be void.

Sixth Circuit Rules Clean Water Act's Permit Shield Can Protect General Permit Holders From Liability    

Devin D. Parram   

dparram@taftlaw.com 

(614) 334-6117    

LinkedIn 


The 6th Circuit recently ruled that facilities holding a Clean Water Act ("CWA") Section 402 general permit - one of two types of National Pollutant Discharge Elimination System ("NPDES") permits - can use the CWA's "permit shield" provision (33 U.S.C. § 1342(k)) to protect themselves from liability for certain discharges of pollutants that the general permit does not mention. See Sierra Club v. ICG Hazard, LLC, App. No. 13-5086 (6th Cir. Jan. 27, 2015). The ICG Hazard decision is important because it is the first circuit court decision that applies the permit shield provision to NPDES general permits. While ICG Hazard provides clarity regarding the applicability of the permit shield to general permits, decisions from some courts outside of the 6th Circuit indicate that there is still some disagreement regarding the scope of the permit shield provision.



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March 2015 Issue
Burlington Northern Limits on "Arranger" Liability Bleed Into California Statutory Law
SCOTUS Rules That Interpretive Rules Issued by Administrative Agencies are not Subject to Public Notice and Comment
Fracking Wins in a Close Decision
Parent Corporation's Prior Assertions of Domination Create "Alter Ego" Scenario
Environmental Case with $3.4M Insurance Bad Faith Claim Affirmed on Appeal
Seventh Circuit Applies Indiana Choice of Law Rules to Deny Insurance Coverage for Contamination
Sixth Circuit Rules Clean Water Act's Permit Shield Can Protect General Permit Holders From Liability









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