Residents of Gordon Plaza, Inc. v. Cantrell

• Decision Date: 01 February 2022
• Docket Number: No. 21-30294,21-30294
• Citation: 25 F.4th 288
• Parties: RESIDENTS OF GORDON PLAZA, INC., Plaintiff—Appellant, v. LaToya CANTRELL, in her official Capacity as Mayor of the City of New Orleans; City of New Orleans, Defendants—Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

25 F.4th 288

RESIDENTS OF GORDON PLAZA, INC., Plaintiff—Appellant,

v.LaToya CANTRELL, in her official Capacity as Mayor of the City of New Orleans; City of New Orleans, Defendants—Appellees.

No. 21-30294

United States Court of Appeals, Fifth Circuit.

FILED February 1, 2022

Lauren E. Godshall, Adam Babich, Lisa W. Jordan, Tulane University, New Orleans, LA, for Plaintiff-Appellant.

Michael James Laughlin, Esq., Assistant City Attorney, Donesia D. Turner, Attorney, City Attorney's Office for the City of New Orleans, New Orleans, LA, for Defendants—Appellees.

Before Owen, Chief Judge, and Clement and Engelhardt, Circuit Judges.

Edith Brown Clement, Circuit Judge

Appellant, the Residents of Gordon Plaza, Inc. ("Gordon Plaza"), appeals the dismissal with prejudice of its complaint, filed under the citizen-suit provision of the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. § 6972(a)(1)(B), against the Appellees—LaToya Cantrell, in her official capacity as Mayor of the City of New Orleans, and the City of New Orleans (collectively, the "City").

For the reasons that follow, we AFFIRM.

I.

A.

Gordon Plaza is an association of primarily African American residents of a neighborhood called Gordon Plaza located on the site of the Agriculture Street Landfill ("Site") that the City previously owned and operated. Because of this previous use, the Site allegedly contains significant levels of hazardous chemicals and solid waste. Approximately twenty years after the City ceased using the Site as a landfill, it developed the Site for residential use. The City is alleged to have targeted Black residents in selling the residential units and without disclosing that the Site had previously been used as a landfill.

In 1994, the Environmental Protection Agency ("EPA") listed the Site as a Superfund site on the National Priorities List ("NPL") based on concerns about arsenic, lead, and polynuclear aromatic hydrocarbon levels. From 1994 to 2001, the EPA fenced off part of the Site, removed two feet of soil in some areas, placed a permeable "geotextile mat" over some contaminated soils, and covered some contaminated soils with about a foot of soil. In 2002, the EPA announced it had "completed all response actions for the Agriculture Street Landfill site in accordance with Close Out Procedures for National Priorities List Sites."

In 2005, Hurricane Katrina devastated New Orleans. The complaint alleges that, after the storm, the U.S. Agency for Toxic Substances and Disease Registry (a federal public health agency of the U.S. Department of Health and Human Services) concluded that chemical concentrations at the Site "pose[d] an indeterminate public health hazard." And in 2018, the EPA determined that the soil on nine residential properties on the Site "may contain contaminant levels that are unacceptable for non-industrial use." Gordon Plaza alleges that, because of soil erosion caused by storms and the passing of time, the geotextile mat is exposed in some places and missing in others, releasing contaminated soil.

In 2008, the EPA and the City reached a Superfund consent decree ("Consent Decree" or "Decree") requiring the City to take certain actions to "protect the remedy" that the EPA installed at the Site, and "thereby, [protect] the public health or welfare or the environment at the Site." The "remedy" is defined as "the excavation of 24 inches of soil, placement of a permeable geotextile mat/marker on the subgrade, backfilling the excavated area with clean fill, covering the clean fill with grass sod, landscaping and yard restoration, driveway and sidewalk replacement, and final detailing." Because the "soil cap and geotextile mat covering the Site could be breached or degraded by excavation ... or by the failure to maintain the vegetative cover over the soil cap," the Decree requires the City "to maintain the [soil] cap" at the Site. Specifically:

The [City] will mow vegetation at least twice per year, and otherwise maintain[ ] its right of ways ... in order to maintain a stable vegetative cover. Because lack of mowing/maintenance by private owners of land within the Site is likely to damage the subsurface geotextile mat, the City will use its available authorities to (a) require that landowners mow and otherwise maintain the grass vegetation on their properties, or (b) undertake the necessary maintenance directly.

The City must also "refrain from using the Site ... in any manner that would interfere with or adversely affect the implementation, integrity, or protectiveness of the remedy."

The Decree also required the City to provide a Technical Abstract—a protocol for utility providers to "follow to maintain the integrity of the permeable soil and geotextile mat" with instructions on how to properly excavate beneath the geotextile mat, if necessary—to all utilities operating within the Site, and to "direct that all of its agencies and departments ... incorporate the Technical Abstract ... as standard operating procedures when working within the Site."

Among its other commitments under the Consent Decree, the City was required to "designate an official of the City as the Project Coordinator who will be responsible for ensuring the City's compliance with the requirements of the Decree" and who "shall be the lead point of contact for EPA with the City." The City "shall submit to EPA on an annual basis ... a written progress report that describes the actions which have been taken to achieve compliance." And the Decree additionally provides for EPA oversight, including access for "5-year reviews," for "[m]onitoring, investigation, removal, remedial or other activities at the Site," as well as for "[a]ssessing [the City's] compliance with [the] Consent Decree."

The EPA's most recent five-year review report was issued in 2018 ("2018 Five-Year Review Report") and comprises 31 pages of EPA findings and 321 pages of attachments and appendices. The Report concluded that the City was in compliance with the Consent Decree. Specifically, the Report stated that the "soil barrier that covers the entire site is in place and expected to remain in place over time, restricting exposure to the remaining subsurface contaminants associated with the site."

B.

On May 15, 2020, Gordon Plaza brought this citizen suit under RCRA, § 6972(a)(1)(B), alleging that the Site remains contaminated with hazardous chemicals causing residents to suffer from cancer and other health conditions. Gordon Plaza seeks a declaration of imminent and substantial endangerment and an order that the City perform an environmental quality analysis, risk assessment, and full abatement of the Site. The complaint failed to inform the district court of the 2008 Consent Decree between the City and the EPA.

The City attached the Decree to its responsive pleadings and moved to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), arguing that the suit was precluded by RCRA's statutory bar on citizen suits where a "responsible party is diligently conducting a removal action" pursuant to a consent decree with the EPA. See 42 U.S.C. § 6972(b)(2)(B)(iv) ; see also Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), 42 U.S.C. § 9601(23) (providing statutory definition of "removal" action). The district court took judicial notice of the Consent Decree and granted dismissal with prejudice based on its finding that the Decree "requires the City to perform removal actions on an ongoing basis" and that Gordon Plaza "fail[ed] to plausibly allege that the City's continued actions under the consent decree are not ‘removal actions.’ "

Gordon Plaza moved the court to reconsider its final order under Rule 59(e). See FED. R. CIV. P. 59(e). The district court denied the motion. Gordon Plaza timely appealed.

We note that the instant lawsuit presents Gordon Plaza's second time at bat on these claims—which it failed to properly inform the district court about as required by the local rules. See E.D. La. L.R. 3.1. In April 2018, Gordon Plaza filed a RCRA citizen suit against the City, seeking the relocation of its members ("2018 Litigation"). The suit was dismissed without prejudice for lack of standing. Residents of Gordon Plaza, Inc. v. Cantrell (Gordon Plaza I ), No. 18-4226, 2019 WL 2330450, at *2–3 (E.D. La. May 31, 2019).¹ Gordon Plaza's motion to amend the complaint was denied upon the district court's finding that Gordon Plaza had acted with "bad faith or dilatory motive" because, in part, its "theories of recovery [were] intentionally advanced in a piecemeal or disjointed fashion."

On appeal, Gordon Plaza argues three grounds for reversal. First, that the district court abused its discretion by relying on the City's diligent-removal-action defense, which Gordon Plaza contends was improperly asserted in a reply brief. Second, that the district court erred in finding that the City has been diligently engaged in a removal action.² And third, that the district court abused its discretion by denying leave to amend.

II.

We review de novo the grant of a motion to dismiss under Rule 12(b)(6). See Meador v. Apple, Inc. , 911 F.3d 260, 264 (5th Cir. 2018). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. We accept all well-pleaded facts as true and draw all reasonable inferences in favor of the plaintiff. See Kelson v. Clark , 1 F.4th 411, 416 (5th Cir. 2021).

III.

Gordon Plaza sets forth three arguments to challenge the district court's dismissal of the complaint under RCRA's statutory bar,...