Consent decrees play a major role in environmental litigation. This week, Maine People’s Alliance v. Holtrachem Manufacturing Company, one of the nation’s longest-running cases under the Resource Conservation and Recovery Act’s (RCRA) citizen suit provisions, has essentially ended with a Maine district court’s entry of a consent decree negotiated between owners of a former color-alkali plant and two non-governmental organizations (NGOs).

The court’s order is available here. The decision illustrates a variety of points worth noting to the regulated community:

Finally, in approving the Consent Decree, the court declined to issue the defendant’s requested bar order. After the parties had negotiated a settlement, the defendant initially requested an order in connection with the Consent Decree that would bar any future lawsuits on its past discharges. After meeting with state officials, among others, the defendant amended the requested bar order to carve out, thereby allow, claims brought by the state and federal governments. The plaintiffs—along with an industrial company operating around the River—opposed the bar order during the Consent Decree comment period. The court ultimately agreed with the plaintiffs and declined to issue the order.

A series of industrial companies owned and operated a color-alkali plant on the Penobscot River in Orrington, Maine, from 1967 until 2000. The facility used significant quantities of mercury, and mercury-contaminated sludge was released from the plant to the Penobscot River as part of plant operations. In 2000, the NGOs sued two of these companies for violation of 42 USC § 6972(a)(1)(B), alleging that the companies had caused an “imminent and substantial endangerment to health and the environment” as a result of their discharges of mercury into the Penobscot River.

Beginning in 2000 and continuing until the proposed Consent Decree was filed, the following took place:

Consent decrees in the RCRA context set forth a negotiated framework intended to address risks that past behavior (i.e., releases of waste) “may” pose an imminent and substantial endangerment to human health and the environment. Consent decrees can be controversial in the environmental context (see here). While the Consent Decree here is far-reaching, there was “‘consensus’ among the public commentators and parties’ experts ‘that this negotiated resolution is preferable to continued litigation and the cleanup should begin right away.’”

In a context where there is broad support for an RCRA consent decree, a reviewing court conducts a “multifaceted” assessment of a proposed decree, weighing the decree’s likely effectiveness in addressing environmental issues; how the parties negotiated; whether the decree provides for “satisfactory compensation for anticipated remedial costs”; and whether the decree was designed to provide a remedy that “ameliorates” risk posed by past RCRA violations.

Here, the court found that the Consent Decree should be entered because the parties “engaged in three years of extensive negotiations” and achieved a settlement that embodies principles of “corrective justice and accountability” to create an “action-oriented path forward” where the court’s remedial decision making authority was transferred to a trustee. While limited appeal rights to federal courts would remain, the decree created a mechanism where the federal judiciary's role in monitoring mercury contamination in the Penobscot River “will essentially be over.” As the parties’ work moves into a remedial stage, “the federal court cannot be as nimble and creative as a private trustee,” and nimbleness was now required.

In the court’s view, the trustee was empowered to be a “remediation czar for the Penobscot River” with “an extraordinary degree of authority” over the river’s fate. The Consent Decree grants the trustee broad powers to formulate community relations plans and determine what remediation method would be employed in various portions of the estuary. While the parties and community would have the ability to comment on aspects of the decision making, the trustee was vested with nearly sole decision making power, including related to highly technical areas in which the parties themselves had never been able to forge a concrete compromise. The main checks required by the Court, in addition to those proposed in the decree, relating to rights of comment and financial audit. Outside of relatively minor tweaks, the court determined that the proposed consent decree was largely reasonable.

Seeking finality, the defendant requested that the court, in approving the proposed Consent Decree, also enter a bar order preventing any future claims against the defendant in connection with the Penobscot River site (except for specified claims brought by certain governmental organizations). Although the court concluded that it did have the authority to issue the bar order, it refused to do so, expressing skepticism that the proposed bar order was “either necessary or appropriate.”

First, after noting that other courts have issued such orders in Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) — but not RCRA — litigation, the court ultimately rejected the defendant’s main argument: that it should be granted future protection because it was willing to pay a substantial amount to remediate the Penobscot River. Noting that the negotiated amount is substantially below the defendant’s full potential exposure, the court rejected this basis for a bar.

Second, the court expressed concern that any bar order could result in inequity. For example, if the defendant later sought contribution under CERCLA from other potentially responsible parties (PRPs), those non-party PRPs would be barred from bringing affirmative claims against the defendant. But if the court were to carve out an exception allowing such PRPs to bring claims against the defendant, that would protect only “asset-heavy businesses,” leaving private citizens still constrained by the bar order. The court was “chary indeed about issuing an order which so starkly favors the powerful and disfavors the interest of the common citizen.”

Third, the court drew parallels with Taylor v. Sturgell, explaining that there may be parties whose unique interests were not adequately represented by plaintiffs. The court was wary to “deny them their day in court without knowing who they are or the nature of their claims.”

Finally, the court explained that the proposed bar order would bar claims brought about by the remediation efforts themselves. Considering “not only whether things will go right, but also whether they will go wrong,” the court held that entry of the “broad order precluding future remediation claims is inappropriate and potentially unenforceable for due process and policy reasons.”

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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