Cape Fear River Watch, Inc. v. Duke Energy Progress, Inc.
| Decision Date | 09 June 2014 |
| Docket Number | No. 7:13–CV–200–FL.,7:13–CV–200–FL. |
| Court | U.S. District Court — Eastern District of North Carolina |
| Parties | CAPE FEAR RIVER WATCH, INC.; Sierra Club; and Waterkeeper Alliance, Plaintiffs, v. DUKE ENERGY PROGRESS, INC., Defendant. |
CAPE FEAR RIVER WATCH, INC.; Sierra Club; and Waterkeeper Alliance, Plaintiffs,
v.
DUKE ENERGY PROGRESS, INC., Defendant.
No. 7:13–CV–200–FL.
United States District Court, E.D. North Carolina, Southern Division.
Signed June 9, 2014
Motion granted in part and denied in part.
[25 F.Supp.3d 799]
Frank S. Holleman, III, Chandra T. Taylor, Nicholas S. Torrey, Chapel Hill, NC, for Plaintiffs.
Brent A. Rosser, Frank E. Emory, Jr., Hunton & Williams, L.L.P., Charlotte, NC, Charles D. Case, Hunton & Williams, LLP, Raleigh, NC, William Clarke, Roberts & Stevens, PA, Asheville, NC, for Defendants.
LOUISE W. FLANAGAN, District Judge.
This matter comes before the court on defendant's motion to dismiss for failure to state a claim and for lack of subject matter jurisdiction (DE 15), to which plaintiffs have responded and defendant replied.1
[25 F.Supp.3d 800]
These issues are now ripe for review. For the following reasons, defendant's motion is granted in part and denied in part.
Cape Fear River Watch, Inc., Sierra Club, and Waterkeeper Alliance (“plaintiffs”) initiated this matter on September 12, 2013,2 by filing complaint against defendant pursuant to the Clean Water Act, 33 U.S.C. §§ 1251– 1376 (“CWA” or “the Act”) citizens' suit provision, alleging violations through unauthorized surface discharges into Sutton Lake in North Carolina (Count I), entering of removed substances into state waters and navigable waters of the United States (Count II), and discharges through close hydrologic flow into Sutton Lake (Count III). Plaintiffs seek declaratory and injunctive relief as well as civil penalties and costs. Defendant moved to dismiss in lieu of answering the complaint on November 5, 2013, pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. Plaintiffs responded in opposition on December 17, 2013, and defendant replied on January 17, 2014.
Although the motion to dismiss was submitted for consideration on January 21, 2014, plaintiffs filed two motions for permission to inform the court concerning developments regarding criminal investigation into the Sutton Site 3 and litigation on February 25, 2014, and March 5, 2014. In order to encourage a more formal process of presentation of such additional materials, the court ordered the parties to consider a stay of the case and/or additional briefing on the motion to dismiss on March 5, 2014. The court also tolled defendant's response time to plaintiff's motions. After the parties responded, the court further ordered on March 20, 2014, that a temporary stay was not appropriate, and provided that supplemental briefing would be conducted on the motion to dismiss. On April 3, 2014, plaintiffs submitted a supplemental brief, and on April 17, 2014, defendant submitted a supplemental brief, both in accordance with the court's order. The motion to dismiss was again submitted for consideration on April 18, 2014.
Plaintiffs are conservation groups whose members recreate, fish and operate charter fishing businesses on Sutton Lake, and who have had their use enjoyment of Sutton Lake reduced by defendant's discharges. Defendant is engaged in the generation, transmission, distribution and sale of electricity. It is a North Carolina corporation headquartered in Raleigh. Defendant's
[25 F.Supp.3d 801]
L.V. Sutton Steam Electric Plant coal-fired electricity generating plant (“Sutton”) is located north of Wilmington, and adjacent to Sutton Lake and the Cape Fear River. Defendant owns and operates Sutton.
In 1971, North Carolina authorized, through statute and easement, defendant's predecessor to dam Catfish Creek, a navigable stream, in order to create the 1,100–acre Sutton Lake. Since then, the lake has been managed by the North Carolina Wildlife Resources Commission (“WRC”) as a public fishery. Sutton Lake is a popular fishing destination, frequented by sport and subsistence fishermen for consumption. WRC manages the Sutton Lake fishery with financial support from federal funds and grants from the U.S. Fish and Wildlife Service's Sport Fish Restoration Program. These entities encourage the public to fish at the Lake and recently renovated its boat ramps and fishing pier to provide greater public access. North Carolina Department of Justice, in correspondence attached to the complaint, suggested that Sutton Lake is a water of the state, as defined under North Carolina law.5
Pursuant to its delegated authority under the CWA, 33 U.S.C. § 1342(b), DENR issued National Pollutant Discharge Elimination System (“NPDES”) permit # NC0001422, effective January 1, 2012, (the “Sutton NPDES permit”). The Sutton NPDES permit authorizes only one point source discharge into the Cape Fear River from the Sutton Site. Defendant does not have a NPDES permit for discharges into Sutton Lake.
The Sutton facility includes two coal ash settling lagoons, known as the Old Ash Pond Area (approximately 54 acres, constructed in 1972) and New Ash Pond (approximately 82 acres, constructed in 1984), which border Sutton Lake and discharge into it. The lagoons contain coal ash stored in a wet state. Neither of the lagoons has a synthetic liner. A sinkhole opened beneath one of the berms of the New Ash Pond in 2000, and there was a partial collapse and spill from another of the New Ash Pond berms in 2010. EPA noted that some of the Old Ash Pond berms may be constructed on a foundation of coal ash, as was the case with a 2008 Kingston, Tennessee, coal ash spill. The berms of both Sutton coal ash lagoons have been given a “Significant” Hazard rating by EPA based on the potential for economic and environmental losses due to a spill.
2. Discharges and ContaminationDefendant has dumped and is dumping polluted water from its coal ash lagoons directly into Sutton Lake and its public fishery. These discharges include coal ash sluice water, coal pile runoff, chemical metal cleaning wastes, and other wastewater. As a result, Sutton Lake has become heavily contaminated with toxic pollutants including arsenic, selenium, mercury, antimony, cadmium, chromium, lead and zinc; and other pollutants including sulfate, copper, ammonia, nitrogen, phosphorus, iron, manganese, total dissolved solids, and total suspended solids.
Taking selenium as an example, decades of sampling reveal that concentrations in Sutton Lake have increased dramatically over time, such that in recent years the selenium concentrations in the surface water reached levels that cause reproductive
[25 F.Supp.3d 802]
failure of fish and waterfowl and have far exceeded those levels in the lake sediments and in fish tissue itself. WRC determined that the sediment and fish tissue concentrations of selenium represent a “High” hazard for reproductive failure of fish and waterfowl. WRC staff commented that defendant has been withholding selenium data from WRC, despite multiple requests for updated concentration information. Once selenium levels reach a certain point, the fishery could be killed off entirely. Selenium is also bioaccumulative, meaning it is passed up the food chain in increasing concentrations, and excessive amounts have been found in water snakes, small mammals, birds and humans.
As summarized by the parties, the Sutton NPDES permit treats discharges from the waste streams of the coal ash lagoons into Sutton Lake as “internal outfalls” within a waste treatment system.6 These discharges are termed “internal” in the permit because they are considered not to discharge to waters of the United States. Accordingly, the Sutton NPDES permit contains no limits on the discharges to Sutton Lake for toxic pollutants such as selenium and arsenic. Thus, the permit does not protect water quality in Sutton Lake.
In addition, defendant has allowed pollutants and coal ash materials to escape from its coal ash lagoons into the groundwater at Sutton. These discharges are prohibited by the Sutton NPDES permit. The resulting plume of contaminated groundwater is migrating towards drinking water supply wells that provide drinking water to the community around Flemington Road. These Flemington wells are located approximately half a mile from the Sutton coal ash lagoons. As described in the complaint, a recent “Source Water Assessment Program Report” prepared by the North Carolina Division of Environmental Health, Public Water Supply Section, for the water system served by the Flemington wells assigned them an “Inherent Vulnerability Rating,” “Contaminant Rating,” and “Susceptibility Rating” the highest risk ratings, and the report listed the Sutton facility numerous times as a “Potential Contaminant Source” for these wells. The report also confirms that many of the highly contaminated groundwater wells at Sutton are within the area that contributes groundwater to the Flemington wells.
The contaminated groundwater at Sutton is also flowing directly into a canal that is connected to and flows into Sutton Lake. As a result, the coal ash lagoons are discharging pollutants into Sutton Lake via this hydrologic connection. Defendant had plans to retire its coal-fired generating operation at Sutton by the end of 2013, but had not submitted a closure plan for the ash lagoons to DENR and planned to leave the ash in place and continue using the ash lagoons to receive waste streams and discharge into Sutton Lake. As long as the coal ash remains in these leaking lagoons, it will continue to discharge pollutants into Sutton Lake and place the public fishery at risk of a coal ash spill into the Lake.
B. Recent Developments at Coal Ash Facilities StatewideBefore plaintiffs filed complaint in this court, DENR sued defendant in state court, on August 16, 2013, alleging violations of state environmental laws at Sutton and five other facilities in North Carolina. State of North Carolina v. Duke Energy Progress, Inc., C.A. No....
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