Inland Empire Waterkeeper v. Corona Clay Co.

• Decision Date: 20 September 2021
• Docket Number: 20-55678,Nos. 20-55420,s. 20-55420
• Citation: 13 F.4th 917
• Parties: INLAND EMPIRE WATERKEEPER, a project of Orange County Coastkeeper; Orange County Coastkeeper, a California non-profit corporation, Plaintiffs-Appellants/ Cross-Appellees, v. CORONA CLAY CO., a California Corporation, Defendant-Appellee/Cross-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

13 F.4th 917

INLAND EMPIRE WATERKEEPER, a project of Orange County Coastkeeper; Orange County Coastkeeper, a California non-profit corporation, Plaintiffs-Appellants/ Cross-Appellees,

v.CORONA CLAY CO., a California Corporation, Defendant-Appellee/Cross-Appellant.

Nos. 20-55420

20-55678

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 4, 2021 Pasadena, California

Filed September 20, 2021

Christopher Sproul (argued), Environmental Advocates, San Francisco, California; Sarah Spinuzzi, Orange County Coastkeeper, Inland Empire Waterkeeper, Costa Mesa, California; Jennifer F. Novak, Law Office of Jennifer F. Novak, Rancho Palos Verdes, California; for Plaintiffs-Appellants/Cross-Appellees.

Brian Neach (argued), Pacheco & Neach P.C., Irvine, California, for Defendant-Appellee/Cross-Appellant.

Robert W. Byrne, Senior Assistant Attorney General; Eric M. Katz, Supervising Deputy Attorney General; Carol A. Z. Boyd, Deputy Attorney General; Office of the Attorney General, Los Angeles, California; for Amicus Curiae California State Water Resources Control Board.

Anthony L. François, Pacific Legal Foundation, Sacramento, California, for Amici Curiae Chantell and Michael Sackett, Duarte Nursery Inc., John Duarte, and Roger J. LaPant Jr.

Before: Eugene E. Siler,^* Andrew D. Hurwitz, and Daniel P. Collins, Circuit Judges.

Dissent by Judge Collins

HURWITZ, Circuit Judge:

In this Clean Water Act ("CWA") citizen suit, the plaintiffs alleged that Corona Clay Company illegally discharged pollutants into the navigable waters of the United States, failed to monitor that discharge as required by its permit, and violated the conditions of the permit by failing to report violations. After the district court granted partial summary judgment to the plaintiffs, a jury returned a defense verdict on the remaining claims. Both sides appealed.

The resolution of the appeal is impacted heavily by two Supreme Court decisions. In the first, Gwaltney of Smithfield, Ltd. v. Chesapeake Bay Foundation , the Court held that the CWA bars citizen suits alleging only "wholly past" violations of permits. 484 U.S. 49, 67, 108 S.Ct. 376, 98 L.Ed.2d 306 (1987). The district court read Gwaltney as requiring proof of ongoing permit discharge violations and so instructed the jury. The second decision, County of Maui v. Hawaii Wildlife Fund , rejected this Court's prior interpretation of the CWA's discharge jurisdictional requirement, 33 U.S.C. §§ 1311(a), 1362(12)(A), and held that an offending discharge must reach the "waters of the United States," id. § 1362(7), either through a direct discharge or a "functional equivalent." ––– U.S. ––––, 140 S. Ct. 1462, 1468, 206 L.Ed.2d 640 (2020). Because County of Maui was decided after the final judgment in this case, the jury instructions corresponded to prior Ninth Circuit law.

We disagree with the district court's interpretation of Gwaltney and hold that if the required jurisdictional discharge into United States waters has occurred, a CWA citizen suit can be premised on ongoing or reasonably expected monitoring or reporting violations. We therefore vacate the district court's judgment and remand for further proceedings consistent with this opinion and with the Supreme Court's intervening decision in County of Maui .

I

Corona Clay Company processes clay products in Corona, California, at an industrial facility overlooking the Temescal Creek. Those industrial activities create "storm water discharge," which Corona may release under a General Permit from the California State Water Resources Board. The Board has the authority to issue permits under the National Pollutant Discharge Elimination System ("NPDES"). See 33 U.S.C. § 1342(b). The permit requires Corona to maintain a Storm Water Pollution Prevention Plan ("SWPPP") employing the "Best Available Technology Economically Achievable" ("BAT") for toxic pollutants and the "Best Conventional Pollutant Control Technology" ("BCT") for conventional pollutants. Corona's permit also requires implementation of "Best Management Practices" ("BMP") and monitoring programs that document the facility's storm water discharges, analyze runoff samples, and report results to the State Board. If a discharge exceeds specified pollutant levels, the permit requires specific "exceedance response actions."

The plaintiffs are two affiliated nonprofit organizations (collectively, "Coastkeeper"). Coastkeeper's mission is to "protect water quality and aquatic resources" in the watersheds and coastal waters of Orange and Riverside Counties. That area includes the Santa Ana River watershed and Temescal Creek, a tributary of the River. The organizations represent roughly 6,000 individual members.

Coastkeeper filed this action in 2018, alleging that Corona violated the conditions of its General Permit and discharged polluted storm water into Temescal Creek (which then flowed into the Pacific Ocean, via the Santa Ana River). Counts Two, Three, and Four alleged permit violations directly related to discharge of pollutants, and the remaining counts asserted other permit violations, including failures to monitor discharges and report violations.

The district court granted partial summary judgment to Coastkeeper on Claims One and Five of the operative complaint. On Claim One, the district court found that Corona had violated the permit's requirement to develop BMPs through the implementation of BAT and BCT. On Claim Five, the court held that Corona violated the permit's requirement to develop an adequate SWPPP for managing storm water discharges. The district court found no dispute that "Defendant's SWPPPs do not comply" with the permit's performance standards, noting, for example, that Corona failed to "implement required BMPs regarding erosion controls." The court also found that because "Defendant is in violation of at least some requirements of the SWPPP," it necessarily violated the permit. Coastkeeper then voluntarily dismissed Claims Three and Four.

This left Claims Two (alleging discharge violations), Six (alleging monitoring violations), and Seven (alleging reporting violations) for trial. The district court instructed the jury that to prevail on those claims Coastkeeper must prove either a forbidden discharge after the complaint was filed, or a reasonable likelihood that discharge violations would thereafter recur. In issuing this instruction, the district court relied on Gwaltney , which precludes a citizen suit for "wholly past" violations of the CWA. See 484 U.S. at 67, 108 S.Ct. 376 ; see also Sierra Club v. Union Oil Co. , 853 F.2d 667, 670 (9th Cir. 1988) (interpreting Gwaltney to permit citizen suits predicated on "ongoing permit violations or the reasonable likelihood of continuing future violations"). The district court held that Gwaltney required "not just any permit violation (such as violations of monitoring and reporting requirements), but specifically discharge violations" as a predicate to a CWA citizen suit.

The special verdict form therefore asked the jury to answer several questions in order. Question 1 asked whether Corona had discharged pollutants into the waters of the United States and whether the discharge occurred after the complaint was filed or "at any time, with a reasonable likelihood that such violations will recur in intermittent or sporadic violations?" The jury was to continue to Question 2 only if it answered Question 1 "Yes." Question 2 asked the jury to determine whether run-off of storm water adversely affected the beneficial uses of Temescal Creek, and, if so, to determine the number of violations. Only after answering these two questions "Yes" would the jury proceed to questions about whether monitoring or reporting violations had occurred.

The jury answered Question One "No," and did not proceed to the other questions. The district court then entered a final judgment in favor of Corona on Claims Two, Six, and Seven, and in favor of Coastkeeper on Claims One and Five. On Claims One and Five, the district court found Corona had committed 664 daily violations of the SWPPP and 1,688 daily violations of the technology-based effluent limitations of the permit. It ordered Corona to implement structural storm water BMPs "sufficient to retain 85th percentile, 24-hour storm event, including a factor of safety, from areas subject to the [permit] no later than December 1, 2020"; to update its SWPPP to comply with the permit; and to employ professional engineers to design and certify retention basins. The court also imposed $3,700,000 in civil penalties on Corona.

In denying post-trial motions from both parties, the district court candidly admitted that "it is certainly possible to read Gwaltney and Sierra Club to encompass not merely discharge violations, but any permit violation, as an ongoing violation on which a citizen suit can be based." The court nevertheless found any error in its instructions "not prejudicial" to Coastkeeper because it had introduced no evidence of discharge violations at trial. Although noting that Corona had responded to a Rule 36 request by admitting that its storm water discharge flowed "indirectly" into Temescal Creek, the court noted "[t]his evidence ... was not introduced at trial," and "decline[d] at this juncture to admit this evidence post hoc and overrule the jury's verdict." Both parties timely appealed.

II

We must first consider Corona's argument that Coastkeeper lacks Article III standing to pursue this citizen suit. Article III requires that the plaintiff have a concrete and particularized injury fairly traceable to the challenged conduct that likely can be redressed by a favorable judicial decision. Friends of the Earth, Inc. v. Laidlaw Env't Servs. (TOC), Inc. , 528 U.S. 167, 180–81, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000). When suing on behalf of its members, an organization must show that its members would have individual standing, the issues are germane to the organization's purpose, and neither the claim nor the...