City of Lake Elmo v. 3M Co., Civil No. 16–2557 ADM/SER

CourtUnited States District Courts. 8th Circuit. United States District Court of Minnesota
Writing for the CourtANN D. MONTGOMERY, UNITED STATES DISTRICT JUDGE
Citation237 F.Supp.3d 877
Parties CITY OF LAKE ELMO, Plaintiff, v. 3M COMPANY, Defendant.
Decision Date15 February 2017
Docket NumberCivil No. 16–2557 ADM/SER

237 F.Supp.3d 877

CITY OF LAKE ELMO, Plaintiff,
v.
3M COMPANY, Defendant.

Civil No. 16–2557 ADM/SER

United States District Court, D. Minnesota.

Signed February 15, 2017


237 F.Supp.3d 880

James J. Thomson, Esq. and Douglas D. Shaftel, Esq., Kennedy & Graven Chartered, Minneapolis, MN and Jeffrey Talbert, Esq., Preti, Flaherty, Beliveau & Pachios, Chartered, LLP, Portland, ME on behalf of Plaintiff.

Wendy Wildung, Esq., Faegre Baker Daniels LLP, Minneapolis, MN and

237 F.Supp.3d 881

William A. Brewer III, Esq., Michael J. Collins, Esq. and Stephanie L. Gase, Esq., Brewer, Attorneys & Counselors, Dallas, TX on behalf of Defendant.

MEMORANDUM OPINION AND ORDER

ANN D. MONTGOMERY, UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

On November 22, 2016, the undersigned United States District Judge heard oral argument on Defendant 3M Company's ("3M") Motion to Dismiss [Docket No. 25]. Plaintiff City of Lake Elmo ("Lake Elmo") is suing 3M to recover costs incurred in response to the discovery of perflourochemicals in its drinking water supply. For the reasons set forth below, 3M's Motion is granted in part and denied in part.

II. BACKGROUND

A. Parties

Lake Elmo is a Minnesota municipal corporation with offices in Lake Elmo, Minnesota. Compl. [Docket No. 1] ¶ 1. 3M is a Delaware corporation with its principal place of business in Maplewood, Minnesota. Id. ¶ 2.

B. 3M's Production and Disposal of Perflourochemicals

Beginning in approximately 1950, 3M manufactured a family of chemical compounds known as perfluorochemicals ("PFCs") for use in its products, including stain repellants, paints, hydraulic fluids, and other chemical products. Id. ¶¶ 6, 37. 3M also sold PFCs to other companies for use in their manufacturing processes. Id.

During the 1950s, 3M disposed of PFCs and PFC-containing waste at a facility it owned and operated in Oakdale, Minnesota (the "Oakdale Facilities"). Id. ¶¶ 7, 38–44. During the early 1970s, 3M disposed of PFCs and PFC-containing waste at the Washington County Landfill (the "Landfill") located in Lake Elmo. Id. ¶¶ 7, 45–49.

The Environmental Protection Agency ("EPA") has issued health advisories for PFCs, warning that drinking water containing PFCs above certain levels poses human health risks. Id. ¶ 10. The risks include cancer, high cholesterol, increased liver enzymes, decreased vaccination response, thyroid disorders, pregnancy-induced hypertension and preeclampsia, and increased risks to a developing fetus. Id. ¶¶ 10, 22, 25, 35.

C. Discovery of PFCs in Lake Elmo's Drinking Water Supply

In 2004, the Minnesota Pollution Control Agency ("MPCA") conducted soil and groundwater investigations which detected the presence of PFCs at the Oakdale Facilities and the Landfill. Id. ¶ 61. The investigations also revealed that the PFCs had leached from the Oakdale Facilities and the Landfill into the groundwater aquifers serving as Lake Elmo's drinking water supply. Id. ¶¶ 9, 61–64, 67–69.

In 2006, the Minnesota Department of Health ("MDH") tested Well #3, in the southern part of Lake Elmo. Id. ¶¶ 66–67. Well #3 had been partially built in 2002 in anticipation of future development and then capped with the intent of finishing construction at a future time. Id. ¶ 66. The PFC levels in Well #3 exceeded the levels at which the MDH advises that the water is not safe for human consumption without treatment. Id. ¶ 68. Between 2006 and 2011, the state tested over 100 water samples from private and municipal wells in Lake Elmo that also exceeded those levels. Id. ¶ 69.

D. Lake Elmo's Alternative Water Supply System

After learning of the PFC contamination in Well #3 and in aquifers that supply

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Lake Elmo's drinking water, Lake Elmo developed a plan for an alternative water supply system. Id. ¶¶ 70, 73. That plan involved constructing a new well in the northeast part of Lake Elmo that would convey water through new trunk lines to the southern portion of the city. Id. ¶ 73. Construction on the alternate water supply system is nearly complete and has cost millions of dollars. Id. ¶ 75. Lake Elmo has also purchased water from the City of Oakdale through an interconnection point at the south end of Lake Elmo, expending hundreds of thousands of dollars in payments and connection fees. Id. ¶ 76.

E. State Court Action, Tolling Agreement

In December 2010, the State of Minnesota (the "State") commenced an action against 3M in Hennepin County District Court alleging that 3M's release of PFCs into the environment resulted in natural resource damages (the "State Court Action"). See State of Minn. v. 3M Co. , No. 27–CV–10–28862 (Minn. D. Ct. 2011) (Burke, J.). On January 14, 2011, Lake Elmo filed a motion to intervene in the State Court Action, alleging claims for common law and statutory nuisance, treble damages under Minn. Stat. § 548.05, common law trespass, strict liability for abnormally dangerous activities, negligent failure to warn of an ultrahazardous condition, statutory well contamination under Minn. Stat. § 103I.241, negligence, and conversion. See Exs. Pl.'s Mem. Opp'n [Docket No. 33] ("State Court Documents") Exs. 4, 5. Lake Elmo's request to intervene was granted on July 21, 2011. Id. Ex. 9.

On October 1, 2013, Lake Elmo voluntarily dismissed its claims pursuant to Minnesota Rule of Civil Procedure 41. Id. Ex. 10. Prior to dismissing its claims, Lake Elmo entered into a tolling agreement with 3M ("Tolling Agreement") in which the parties agreed to "toll the running of any applicable statute of limitations relating to [Lake Elmo's] Claims through and including August 1, 2016." Id. Ex. 11 ¶ 1. The Tolling Agreement states that "[n]othing in this Agreement shall be deemed to revive any claim that is or may already be barred as of the date of this tolling agreement." Id. ¶ 2.

F. Present Action

On July 28, 2016, Lake Elmo filed this action alleging liability under § 107 of the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. §§ 9601, et seq. (Count I), as well as state law claims for common law and statutory nuisance (Count II), common law trespass (Count III), statutory well contamination under Minn. Stat. § 103I.241 (Count IV), negligence (Count V), and conversion (Count VI).

3M moves to dismiss the Complaint for lack of subject matter jurisdiction under Rule 12(b)(1) and for failure to state a claim under Rule 12(b)(6).

III. DISCUSSION

A. Rule 12(b)(1): Lack of Subject Matter Jurisdiction

3M argues that the Complaint must be dismissed under Rule 12(b)(1) for the City's failure to allege facts establishing Article III standing, which is a prerequisite to subject matter jurisdiction. See Lujan v. Defenders of Wildlife , 504 U.S. 555, 559–60, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). Specifically, 3M contends Lake Elmo has not sufficiently alleged an injury in fact or that any harm to Lake Elmo is traceable to 3M's conduct.

1. Standard of Review

3M's Motion attacks the sufficiency of the pleadings and thus raises a

237 F.Supp.3d 883

facial, rather than factual, challenge to the Court's subject matter jurisdiction. See Stalley v. Catholic Health Initiatives , 509 F.3d 517, 521 (8th Cir. 2007). In analyzing a facial challenge to its jurisdiction, the Court applies the same standard of review applied in Rule 12(b)(6) cases. Id. The Court "accept[s] as true all factual allegations in the complaint, giving no effect to conclusory allegations of law." Id. Plaintiffs must affirmatively and plausibly assert facts that suggest they have the right to jurisdiction, rather than facts that are merely consistent with that right. See id. (citing Bell Atl. Corp. v. Twombly , 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "Determining whether a claim is plausible is a ‘context-specific task that requires the reviewing court to draw on its judicial experience and common sense.’ " Hamilton v. Palm , 621 F.3d 816, 818 (8th Cir. 2010) (quoting Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ).

2. Article III Standing

"Article III standing is a threshold question in every federal court case." United States v. One Lincoln Navigator 1998 , 328 F.3d 1011, 1013 (8th Cir. 2003). The party invoking federal jurisdiction bears the burden of establishing standing. Lujan , 504 U.S. at 560, 112 S.Ct. 2130. To meet this burden, a plaintiff must show: (1) an injury in fact; (2) a causal connection between the injury and the challenged conduct of the defendant; and (3) a likelihood that a favorable ruling will redress the alleged injury. Young Am. Corp. v. Affiliated Comput. Servs. (ACS), Inc. , 424 F.3d 840, 843 (8th Cir. 2005) (citing Lujan , 504 U.S. at 560–61, 112 S.Ct....

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2 practice notes
  • Confederated Tribes & Bands of the Yakama Nation v. Airgas USA, LLC, No. 3:17-cv-00164-JR
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Oregon)
    • August 8, 2019
    ...has suffered a sufficient injury to meet the minimum Article III threshold for an injury in fact." City of Lake Elmo v. 3M Co. , 237 F. Supp. 3d 877, 884 (D. Minn. 2017) ; Rolan v. Atl. Richfield Co. , No. 1:16-cv-357-TLS, 2017 WL 3191791, at *5 (N.D. Ind. July 26, 2017) (finding plaintiffs......
  • Bruguier v. Lac Du Flambeau Band of Lake Superior Chippewa Indians, 16–cv–604–jdp
    • United States
    • U.S. District Court — Western District of Wisconsin
    • February 21, 2017
    ..., 709 F.3d 662, 666 (7th Cir. 2013). One exception to this rule is that a plaintiff may still proceed against the unnamed party if the 237 F.Supp.3d 877"party has been provided with adequate notice of the charge." Id. (quoting Eggleston v. Chi. Journeymen Plumbers' Local Union No. 130, U.A.......
2 cases
  • Confederated Tribes & Bands of the Yakama Nation v. Airgas USA, LLC, No. 3:17-cv-00164-JR
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Oregon)
    • August 8, 2019
    ...has suffered a sufficient injury to meet the minimum Article III threshold for an injury in fact." City of Lake Elmo v. 3M Co. , 237 F. Supp. 3d 877, 884 (D. Minn. 2017) ; Rolan v. Atl. Richfield Co. , No. 1:16-cv-357-TLS, 2017 WL 3191791, at *5 (N.D. Ind. July 26, 2017) (finding plaintiffs......
  • Bruguier v. Lac Du Flambeau Band of Lake Superior Chippewa Indians, 16–cv–604–jdp
    • United States
    • U.S. District Court — Western District of Wisconsin
    • February 21, 2017
    ..., 709 F.3d 662, 666 (7th Cir. 2013). One exception to this rule is that a plaintiff may still proceed against the unnamed party if the 237 F.Supp.3d 877"party has been provided with adequate notice of the charge." Id. (quoting Eggleston v. Chi. Journeymen Plumbers' Local Union No. 130, U.A.......

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