Ellis v. Gallatin Steel Co.

• Decision Date: 26 October 2004
• Docket Number: No. 02-6478.,No. 02-6429.,No. 02-6421.,No. 02-6422.,02-6421.,02-6422.,02-6429.,02-6478.
• Parties: Richard ELLIS, Executor of the Estate of Vernon Ellis, Richard Ellis, Thomas Ellis, and Laverne Brashear, Plaintiffs-Appellants (02-6421)/Cross-Appellees, v. GALLATIN STEEL COMPANY (02-6429) and HARSCO CORPORATION (02-6422/6478), Defendants-Appellees/Cross-Appellants.
• Court: U.S. Court of Appeals — Sixth Circuit

390 F.3d 461

Richard ELLIS, Executor of the Estate of Vernon Ellis, Richard Ellis, Thomas Ellis, and Laverne Brashear, Plaintiffs-Appellants (02-6421)/Cross-Appellees, v. GALLATIN STEEL COMPANY (02-6429) and HARSCO CORPORATION (02-6422/6478), Defendants-Appellees/Cross-Appellants.

No. 02-6421.

No. 02-6422.

No. 02-6429.

No. 02-6478.

United States Court of Appeals, Sixth Circuit.

Argued: June 16, 2004.

Decided and Filed: October 26, 2004.

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ARGUED: Jeffrey M. Sanders, Sanders, Tismo & Assoc., Ft. Thomas, Kentucky, for Appellants. John C. Bender, Greenebaum, Doll & McDonald, Lexington, Kentucky, John B. Nalbandian, Taft, Stettinius & Hollister, Cincinnati, Ohio, for Appellees. ON BRIEF: Jeffrey M. Sanders, Sanders, Tismo & Assoc., Ft. Thomas, Kentucky, James M. Hecker, Trial Lawyers for Public Justice, Washington, D.C., Jonathan A. Conte, Cincinnati, Ohio, for Appellants. John C. Bender, David A. Owen, Greenebaum, Doll & McDonald, Lexington, KY, John B. Nalbandian, Thomas T. Terp, Sr., Taft, Stettinius & Hollister, Cincinnati, Ohio, for Appellees.

Before: SILER, DAUGHTREY, and SUTTON, Circuit Judges.

OPINION

SUTTON, Circuit Judge.

Gallatin Steel Company manufactures steel and Harsco Corporation processes slag (a steel byproduct) on adjacent pieces of property in rural Kentucky. In addition to steel and slag, both operations produce a considerable amount of dust, what has come to be known in the regulatory world as "fugitive dust," a phrase that loses its redundancy when applied to dust particles that migrate from one piece of property to another. Unhappily for the Ellis family and for Laverne Brashear, the dust particles from these manufacturing operations migrated to the Ellis family farm and to Brashear's residence, both of which neighbor the Gallatin and Harsco operations.

The itinerant dust prompted several private and governmental lawsuits. The Ellises and Brashear sued the two companies under four legal theories, among others: (1) The companies violated Kentucky's fugitive-dust emission rule, which constitutes a violation of the Clear Air Act; (2) the companies failed to obtain a state "prevention of significant deterioration" (PSD) permit as a precondition to construction of a "major emitting facility," which also constitutes a violation of the Clean Air Act; (3) the companies were jointly and severally liable for response costs incurred by the Ellises under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA); and (4) the companies violated Kentucky nuisance law.

The Environmental Protection Agency of the United States (EPA) also sued the companies under the Clean Air Act and eventually entered into consent decrees with Gallatin and Harsco. The decrees required Gallatin and Harsco to implement compliance measures and to pay civil penalties. Concluding that the decrees barred the private plaintiffs' fugitive-dust claims that pre-dated the entry of the decree, the district court dismissed all of these claims. Concluding that the consent decrees and state administrative proceedings precluded the PSD claims and that the CERCLA claim was meritless, the district court dismissed these claims as well. As to the private plaintiffs' fugitive-dust claims that post-dated the consent decree, the district court awarded injunctive relief (based on the Clean Air Act and state-law nuisance) and compensatory and punitive damages totaling $848,280 (based on state-law nuisance). We affirm all of these rulings with one exception: the district court's award of injunctive relief under the Clean Air Act. As to that claim, the private plaintiffs have not shown that they were entitled to injunctive relief and have not shown that they complied with the notice requirements of the Clean Air Act. That one ruling, accordingly, must be reversed.

I.

Factual Background. Vernon Ellis lives on a 168-acre farm in Gallatin County, Kentucky. His sons, Richard and Thomas, also live on the farm in separate residences along with each of their spouses and children. Laverne Brashear lives across the road (U.S. Highway 42) from them on a half-acre plot of land.

In April 1995, Gallatin Steel Company and Harsco Corporation began operating a steel manufacturing facility and a slag processing plant, respectively, in an industrially zoned area located a quarter-mile down U.S. 42 to the west of the Ellises and Brashear. Gallatin and Harsco are separate legal entities.

That same month, the Ellises began to notice an unfamiliar dust on the farm, which they attributed to Gallatin's and Harsco's operations. With the arrival of the dust, the Ellises say, they have experienced more respiratory problems, headaches itchy throats and infections than they had in the past. To try to mitigate these medical problems, Richard and Thomas Ellis kept their children indoors, they discarded their above-ground swimming pools and they stopped hunting on their land.

In 1997, Richard and Thomas began documenting the dust problems by (among other things) taking photos of the dust crossing Gallatin's and Harsco's property lines. All told, they spent over 8,000 hours monitoring the steel manufacturing and slag processing operations. In addition to the visible dust, the Ellises noticed that explosions occur at the Harsco slag plant, "throwing heavy chunks of slag out like a volcano and shaking the ground like an earthquake." D. Ct. Op. at 7 (Oct. 8, 2002). These explosions regularly vibrate plaintiffs' houses, knock objects over and on one occasion broke Brashear's water pipes.

Procedural History. The fugitive dust and slag explosions prompted seven different proceedings. The Ellises filed two citizen lawsuits against Gallatin and Harsco under federal environmental protection laws (and later amended their complaint to include state-law nuisance claims). Brashear filed a similar citizen suit against Harsco (and also later amended her complaint to include state-law nuisance claims). The United States filed two enforcement actions against the corporations. And Gallatin and Harsco filed various permit applications that resulted in state administrative proceedings to determine whether they had the proper permits for their operations. The proceedings arise in the following statutory and regulatory context.

The federal Clean Air Act is a model of cooperative federalism. It requires each State to establish a state implementation plan (SIP) to limit emissions in accordance with national ambient air quality standards set by the federal EPA. 42 U.S.C. §§ 7409(b)(1), 7410(a)(1). In compliance with this requirement, Kentucky's SIP prohibits "the discharge of visible fugitive dust emissions beyond the lot line of the property on which the emissions originate." 401 Ky. Admin. Regs. 63:010, § 3(2). Other Kentucky laws implement the Clean Air Act by prohibiting the construction of a major emitting facility in designated "attainment areas" (regions, such as Gallatin County, that meet national air quality standards) without first obtaining a PSD permit. 401 Ky. Admin. Regs. 51:017, § 8. The Kentucky Division of Air Quality manages the PSD program and grants the requisite permits. The federal EPA and state agencies may enforce these regulatory requirements on their own initiative or at the suggestion of private citizens. See 42 U.S.C. § 7413(a) (federal EPA enforcement authority); 401 Ky. Admin. Regs. 63:010 & 51:017 (state regulations); 42 U.S.C. § 7604 (citizen suit provisions); see also Her Majesty the Queen v. City of Detroit, 874 F.2d 332, 335 (6th Cir.1989) (EPA-approved state implementation plans are enforceable in federal court).

To supplement these enforcement provisions, the Clean Air Act allows citizens to file actions to enforce its provisions when two requirements have been met. First, citizens cannot commence their own suits unless they have given 60-days' notice to the Administrator of the EPA, to the State, and to the alleged violator. 42 U.S.C. § 7604(b)(1)(A). Second, citizens cannot commence independent suits if the EPA or the State has already commenced an enforcement action and is diligently prosecuting the violation, though they may intervene in these actions. 42 U.S.C. § 7604(b)(1)(B).

On April 28, 1995, the Kentucky Division of Air Quality issued a (non-PSD) air emission permit to Harsco for its slag operation. In 1997, the same Kentucky agency determined that Gallatin and Harsco were not a single emitting source and issued Gallatin a PSD permit. The resulting permit covered Gallatin's steel operations only and did not include Harsco's slag processing plant.

In anticipation of filing a citizen suit under the Clean Air Act, the Ellises sent a notification letter, dated December 29, 1998, to the EPA, the U.S. Attorney General and the Kentucky Natural Resources and Environmental Protection Cabinet. Less than 60 days later, on February 25, 1999, the United States filed its first enforcement action, civil action 99-030, in the district court for the Eastern District of Kentucky. The enforcement action charged Gallatin with violations of the Clean Air Act and several air-quality regulations.

On July 30, 1999, the Ellises filed their first citizen suit, civil action 99-152, against Gallatin and Harsco alleging numerous violations of the Clean Air Act, the Clean Water Act, CERCLA, and the Resource Conservation and Recovery Act. Four months later, on December 1, 1999, the Ellises filed a second citizen suit, civil action 99-242, against Gallatin and Harsco alleging numerous violations of the same four federal statutes.

On January 19, 2000, the district court granted summary judgment against the Ellises on all but three of the claims in their first citizen suit because they had failed to give proper notice of the claims. See D. Ct. Op. at 1 (Jan. 19, 2000). The district court consolidated the three surviving counts (two CERCLA claims and a Clean Air Act c...