Dioxin in the Courts

September 30, 2015

N.Y. Appeals Court Rejects CERCLA Preemption Argument in Love Canal Case

Litigation over Love Canal, one of the “seminal” dioxin sites in the country, continues, as an appellate court in New York has issued an appeal in a case addressing a preemption issue under the federal Comprehensive Environmental Response, Compensation, and Liability Act.

Background

The plaintiffs filed a lawsuit in a trial court in New York against the City of Niagara Falls and various businesses seeking to recover damages for personal injuries and property damage allegedly caused by the defendants’ failure to properly remediate toxic contamination at the Love Canal site (the “landfill remediation”) and in the sewers in the Love Canal corridor (the “sewer project”), as well as for claims related to an alleged release of Love Canal-era toxins in January 2011 during a sewer renovation that was outside of the remediation area.

The action was removed to federal district court. The defendants alleged that the plaintiffs were challenging a remedy established under the federal Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”) and, therefore, that the federal district court had original jurisdiction to adjudicate the matter.

The plaintiffs moved to remand the matter to state court, arguing that they were not challenging the CERCLA remedy but, instead, were challenging the defendants’ allegedly faulty performance of their respective obligations in executing the CERCLA remedy.

In opposition to the plaintiffs’ motion to remand the matter, the defendants asserted that the “[p]laintiffs’ claims necessarily present substantial and disputed questions of federal law, including whether the selection, construction and monitoring of the remedy . . . substantively complied with CERCLA.” (Emphasis added.)

In reply, the plaintiffs stated that they “do not challenge ‘the selection, construction and monitoring‘ of any previous remediation plan. Plaintiffs make no attack on any decision by [the U.S. Environmental Protection Agency], or upon how such a decision was reached.” (Emphasis added.)

The federal district court granted the plaintiffs’ motion to remand the matter to the New York trial court, determining that the “plaintiffs seek relief only under common law theories of negligence, . . . private nuisance, and trespass” and their claims “do not expressly challenge the effectiveness of the [CERCLA] remedy. . . . Rather, plaintiffs seek only to be made whole for any harm proximately caused by defendants’ conduct, whether in performance of operation, maintenance, and monitoring obligations with respect to the remedy, or during the [sewer project].”

With the lawsuit back in New York trial court, various defendants moved to dismiss the complaint, asserting that the plaintiffs had advised the district court that they were not challenging the “selection, construction and monitoring of any previous remediation plan” and that the plaintiffs, therefore, were judicially estopped from challenging the selection, construction or monitoring of the remediation plan, i.e., the CERCLA remedy.

The trial court agreed with the defendants that the plaintiffs were challenging the CERCLA remedy and it dismissed the plaintiffs’ complaint on the ground of judicial estoppel.

The dispute reached the New York Appellate Division, Fourth Department.

The Appellate Court’s Decision

The appellate court reversed the dismissal of the complaint.

In its decision, the appellate court explained that the doctrine of judicial estoppel prohibits a party who has assumed a position in one legal proceeding, and prevailed on that position, from assuming a contrary position in another proceeding because the party’s interests have changed.

In this case, the appellate court declared, the plaintiffs’ position was consistent in both the federal and state court matters inasmuch as they maintained that they did not challenge the CERCLA remedy but, instead, challenged the defendants’ performance of their respective obligations in executing the CERCLA remedy.

The case is Abbo-Bradley v. City of Niagara Falls, 1067 CA 14-02111 (N.Y. App. Div. 4th Dep’t Oct. 2, 2015).

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