National Ass'n of Mfrs. v. U.S. Dept. of Interior

• Decision Date: 16 January 1998
• Docket Number: No. 96-1268,96-1268
• Citation: 134 F.3d 1095
• Parties: , 28 Envtl. L. Rep. 20,509 NATIONAL ASSOCIATION OF MANUFACTURERS, Petitioner, v. UNITED STATES DEPARTMENT OF THE INTERIOR, Respondent.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 1095

134 F.3d 1095

328 U.S.App.D.C. 271, 28 Envtl. L. Rep. 20,509

NATIONAL ASSOCIATION OF MANUFACTURERS, Petitioner, v. UNITED STATES DEPARTMENT OF THE INTERIOR, Respondent.

No. 96-1268.

United States Court of Appeals District of Columbia Circuit.

Argued Dec. 5, 1997.

Decided Jan. 16, 1998.

On Petition for Review of an Order of the United States Department of the Interior.

James R. Bieke, Washington, DC, argued the cause for the petitioner. William R. Galeota and Jan Amundson, Washington, DC, were on brief.

Greer S. Goldman, Attorney, United States Department of Justice, Washington, DC, argued the cause for the respondent. Lois J. Schiffer, Assistant Attorney General, and Naikang Tsao, Attorney, Washington, DC, were on brief.

Before: GINSBURG, HENDERSON and TATEL, Circuit Judges.

Opinion for the court filed by Circuit Judge KAREN LeCRAFT HENDERSON.

KAREN LeCRAFT HENDERSON, Circuit Judge:

The Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. §§ 9601 et seq., (CERCLA) permits a "trustee" ¹ to recover from a "potentially responsible party" (PRP) ² "damages for injury to, destruction of, or loss of natural resources, including the reasonable costs of assessing such injury, destruction, or loss resulting from ... a release" of a hazardous substance regulated under CERCLA. 42 U.S.C. § 9607(a)(4)(C). Subsection 301(c)(1) of CERCLA, directs the President (acting through his designee, the Secretary of the United States Department of Interior) to promulgate regulations that "specify ... standard procedures for simplified assessments [of natural resource damages] requiring minimal field observation, including establishing measures of damages based on units of discharge or release or units of affected area." 42 U.S.C. § 9651(c). A damage assessment performed according to these procedures is entitled to "the force and effect of a rebuttable presumption ... in any administrative or judicial proceeding." 42 U.S.C. § 9607(f)(2)(C).

This is a challenge to the final rule of the Department of the Interior (DOI), entitled "Natural Resource Damage Assessments--Type A Procedures," 61 Fed.Reg. 20,560 (1996) (codified at 43 C.F.R. pt. 11) (hereinafter 1996 Type A rule), that partially implements CERCLA section 301(c), 42 U.S.C. § 9651(c). The petitioner, National Association of Manufacturers (NAM), claims that the Type A final rule violates CERCLA and the Administrative Procedure Act, 5 U.S.C. §§ 551 et seq., (APA), and therefore must be vacated for one or more of the following reasons: (1) the rule permits damages to be calculated without on-site verification that a natural resource has in fact been injured and that the injury is in fact attributable to the particular release in question; (2) the rule does not require a trustee to consider, in calculating natural resource damage (NRD), an alternative to restoration of an adversely affected resource (i.e., replacing a damaged resource or acquiring its equivalent); (3) the rule arbitrarily and capriciously fails to relate selected restoration alternatives to the "services" provided by the resource; ³ (4) the rule allows recovery for purely speculative losses regarding the affected resource's ability to assimilate future releases; (5) the rule authorizes recovery of private losses related to commercial fishing and hunting; (6) the rule's databases and computer submodels are not the "best available procedures" for determining NRD and invalidly rely on outdated studies and information or on suspect methodologies or both; (7) the rule permits a trustee to use Type A and Type B procedures in combination to assess NRD from a single release; ⁴ and (8) the rule provides for calculation of NRD resulting from releases or discharges of oil, notwithstanding the enactment of the Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq., which authorizes the National Oceanic and Atmospheric Administration to regulate oil releases or discharges.

DOI contends that NAM's first and fifth claims are untimely, the third claim was not raised below, one of the arguments included in NAM's seventh claim is not ripe for review and the eighth claim should be dismissed for lack of jurisdiction. Additionally, DOI responds on the merits, arguing that its interpretation of the relevant CERCLA provisions is entitled to deference under Chevron USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). In addition, DOI contends that its damage submodels are otherwise reasonable, scientifically valid and adequately supported by credible studies.

We conclude that NAM failed to raise the third claim below and that it lacks standing to bring the eighth claim. Regarding the remaining claims, we conclude that DOI's interpretation of relevant CERCLA provisions is entitled to deference under step two of the familiar Chevron analysis and that its damage submodels suffice. Accordingly, we deny NAM's request to set aside DOI's 1996 Type A rule, as amended. ⁵

I. BACKGROUND

Section 301(c) of CERCLA recites:

(1) The President, acting through Federal officials designated by the National Contingency Plan published under section 9605 of this title, shall study and, not later than two years after December 11, 1980 shall promulgate regulations for the assessment of damages for injury to, destruction of, or loss of natural resources resulting from a release of oil or a hazardous substance for the purposes of this chapter and section 1321(f)(4) and (5) of Title 33. Notwithstanding the failure of the President to promulgate the regulations required under this subsection on the required date, the President shall promulgate such regulations not later than 6 months after October 17, 1986.

(2) Such regulations shall specify (A) standard procedures for simplified assessments requiring minimal field observation, including establishing measures of damages based on units of discharge or release or units of affected area, and (B) alternative protocols for conducting assessments in individual cases to determine the type and extent of short- and long-term injury, destruction, or loss. Such regulations shall identify the best available procedures to determine such damages, including both direct and indirect injury, destruction, or loss and shall take into consideration factors including, but not limited to, replacement value, use value, and ability of the ecosystem or resource to recover.

(3) Such regulations shall be reviewed and revised as appropriate every two years.

42 U.S.C. § 9651(c). Trustees must retain sums recovered for NRD "without further appropriation, for use only to restore, replace, or acquire the equivalent of [the damaged] resources." 42 U.S.C. § 9607(f)(1). Further, "[t]he measure of damages in any action ... [is] not ... limited by the sums which can be used to restore or replace" the affected resources, although CERCLA proscribes "double recovery ... for natural resource damages, including the costs of damage assessment or restoration, rehabilitation, or acquisition for the same release and natural resource." 42 U.S.C. § 9607(f)(1).

As the final sentence of subsection 301(c)(1) foresaw, development of Type A and Type B procedures has not been accomplished as expeditiously as the Congress directed. Today, more than 17 years after section 301(c) of CERCLA was enacted, DOI has developed "simplified assessment[ ]" (i.e., Type A) procedures for only two aquatic environments: (1) the Great Lakes environments and (2) coastal and marine environments. The latter were the first Type A procedures developed; they were promulgated in 1987, see Natural Resource Damage Assessments, 52 Fed.Reg. 9042 (1987) (codified at 43 C.F.R. pt. 11 (1988)) (hereinafter 1987 Type A rule), and subsequently reviewed by this court, see Colorado v. DOI, 880 F.2d 481 (D.C.Cir.1989). In Colorado we upheld the 1987 Type A rule in part and vacated it in part, relying on our companion decision reviewing a challenge to DOI's Type B rule. See Ohio v. DOI, 880 F.2d 432 (D.C.Cir.1989) [hereinafter Ohio II]. After Colorado--in which we stated that "[w]e fully expect DOI to act as expeditiously as possible," 880 F.2d at 491--DOI spent almost seven more years revising the Type A procedures and adding to them submodels for assessing NRD in Great Lakes environments. See 1996 Type A rule, 61 Fed.Reg. at 20,560.

In light of the delay, it is indeed fortunate that a trustee has authority under CERCLA to settle claims for NRD without recourse to either Type A or Type B procedures. See 42 U.S.C. § 9622. Even if claims are not settled, a trustee is under no obligation to use Type A or Type B procedures to calculate damages--although the trustee must use the procedures if it wishes to use the rebuttable presumption provided for in subsection 107(f)(2)(C) of CERCLA, 42 U.S.C. § 9607(f)(2)(C). See 43 C.F.R. § 11.10 (1996).

If a trustee decides that a formal assessment is needed to effect recovery of NRD, the trustee must complete four administrative steps: (1) Preassessment, (2) Assessment Plan, (3) Assessment and (4) Post Assessment. 1996 Type A rule, 61 Fed.Reg. at 20,562. The first step, Preassessment, consists of "rapid review of readily available information that focuses on resources for which the Federal or State agency or Indian tribe may assert trusteeship under section 107(f) or section 126(d) of CERCLA." 43 C.F.R. § 11.23(b) (1996). The purpose of the Preassessment is to "ensure that there is a reasonable probability of making a successful claim before monies and efforts are expended in carrying out an assessment." Id.

The second step, the Assessment Plan, is undertaken "to ensure that the assessment is performed in a planned and systematic manner and that methodologies selected ... for a type A assessment or ... for a type B assessment ... can be conducted at a reasonable cost." 43 C.F.R. § 11.30(b). "The Assessment Plan must identify and document...