United States v. Outboard Marine Corp.

• Decision Date: 08 October 1982
• Docket Number: No. 78 C 1004.,78 C 1004.
• Citation: United States v. Outboard Marine Corp., 549 F.Supp. 1036 (N.D. Ill. 1982)
• Parties: UNITED STATES of America, Plaintiff, v. OUTBOARD MARINE CORPORATION, et al., Defendants.
• Court: U.S. District Court — Northern District of Illinois

549 F. Supp. 1036

UNITED STATES of America, Plaintiff, v. OUTBOARD MARINE CORPORATION, et al., Defendants.

No. 78 C 1004.

United States District Court, N.D. Illinois, E.D.

October 8, 1982.

James T. Hynes, James P. White, Asst. U.S. Attys., Chicago, Ill., Elizabeth Stein, Atty., Dept. of Justice, Washington, D.C., M. Kaye Jacobs, Sebastian Patti, Enforcement Attys., U.S. E.P.A., Chicago, Ill., John Wheeler, Atty., U.S. E.P.A., Washington, D.C., for U.S.

John Van Vranken, Asst. Atty. Gen., Chicago, Ill., for State of Ill.

Richard Phelan, Michael A. Pope, Roseann Oliver, Phelan, Pope & John, Richard J. Kissel, Jeffrey C. Fort, Carol L. Dorge, Martin, Craig, Chester & Sonnenschein, Chicago, Ill., for Outboard Marine Corp.

Fred H. Bartlit, Jr., James H. Schink, Bruce A. Featherstone, Robert E. Shapiro, Kirkland & Ellis, Chicago, Ill., for Monsanto Co.

MEMORANDUM OPINION AND ORDER

GETZENDANNER, District Judge:

Defendant Outboard Marine Corporation ("OMC") has moved to dismiss Counts I and II of the Second Amended Complaint of the United States. For the reasons stated below, the motion is denied.¹

Count I — The Refuse Act

Count I of the Second Amended Complaint seeks relief under the Refuse Act, 33 U.S.C. § 407.² Count I includes allegations that from approximately 1959 until 1972 OMC used a PCB-bearing hydraulic fluid in its Waukegan, Illinois facility; that leaks and spills of this fluid were routed into the facility's wastewater collections; that the wastewater collections were discharged into Lake Michigan, the Waukegan Harbor, and the North Ditch, a tributary of Lake Michigan; that as a result, PCBs were and continue to be discharged into Lake Michigan, the Waukegan Harbor and the North Ditch; and that until 1975 OMC had not applied for a permit to discharge PCBs. The Government requests that OMC be ordered to construct a bypass of the North Ditch, to remove and treat allegedly contaminated soil and groundwaters from OMC's property, and to dredge the Waukegan Harbor and the North Ditch.

OMC does not dispute that a violation of the Refuse Act has been alleged; instead, OMC urges that for various reasons the requested relief is not available under the Refuse Act. OMC's two lines of argument are as follows. First, OMC argues that "remedial actions pursuant to the Refuse Act have been precluded by § 4(a), the savings provision of the Clean Water Act." Second, OMC argues that since the Refuse Act does not provide expressly for any injunctive remedies, injunctive relief that courts in the past have decreed to enforce the Refuse Act was judge-made law; such relief therefore should be treated as federal common law, preempted by the 1972 amendments to the Clean Water Act. Milwaukee v. Illinois, 451 U.S. 304, 101 S.Ct. 1784, 68 L.Ed.2d 114 (1981) ("Milwaukee II").

The savings clause on which OMC bases its first argument reads:

No suit, action, or other proceeding lawfully commenced by or against the Administrator or any other officer or employee of the United States in his official capacity or in relation to the discharge of his official duties under the Federal Water Pollution Control Act as in effect immediately prior to the date of enactment of this Act shall abate by reason of the taking effect of the amendment made by section 2 of this Act. Section 2 of the 1972 amending Act included all the substantive amendments. The court may, on its own motion or that of any party made at any time within twelve months after such taking effect, allow the same to be maintained by or against the Administrator or such officer or employee.

Water Pollution Control Act Amendments of 1972, Pub.L.No. 92-500, § 4(a), 86 Stat. 896-97. This clause saves certain litigation pending on the effective date of the 1972 amendments (October 18, 1972) and, with leave of court, litigation filed within a year after that date. Several cases have held that pending Refuse Act litigation was intended to be saved by this provision. E.g., Reserve Mining Co. v. EPA, 514 F.2d 492 (8th Cir. 1975).³ OMC argues by negative inference: since the present action was filed more than one year after the 1972 amendments took effect, the Refuse Act count is not saved by this clause, and it therefore must be dismissed. Language in the second Court of Appeals decision in this case seems to endorse OMC's view:

The enactment of § 4(a), Pub.L.No. 92-500 § 4(a), 86 Stat. 896-97, which preserves those prosecutions under the Refuse Act of 1899, 33 U.S.C. § 407, that were begun before October 18, 1972, provides further evidence that Congress considered the problem of pre-1972 discharges, and specifically the appropriate role in the statutory scheme for remedies against polluters.

Illinois v. Outboard Marine Corp., 680 F.2d 473, 478 (7th Cir. 1982) ("OMC II"). OMC's argument cannot, however, survive a close examination of the 1972 amendments.

Another section of the 1972 amendments expressly preserves the Refuse Act as a valid basis for federal authority in the area of water pollution:

This Act shall not be construed as (1) limiting the authority or functions of any officer or agency of the United States under any other law or regulation not inconsistent with this Act; (2) affecting or impairing the authority of the Secretary of the Army (A) to maintain navigation or (B) under the Act of March 3, 1899 (30 Stat. 1112); except that any permit issued under section 404 of this Act shall be conclusive as to the effect on water quality of any discharge resulting from any activity subject to section 10 of the Act of March 3, 1899, or (3) affecting or impairing the provisions of any treaty of the United States.

Water Pollution Control Act Amendments of 1972, § 511(a), 33 U.S.C. § 1371(a).⁴ That this section operates to preserve the Refuse Act was recognized in United States v. Rohm & Haas, 500 F.2d 167, 170 n. 1 (5th Cir. 1974), cert. denied, 420 U.S. 962, 95 S.Ct. 1352, 43 L.Ed.2d 439 (1975), and United States ex rel. Scott v. U.S. Steel Corp., 356 F.Supp. 556, 559 (N.D.Ill.1973) (McMillen, J.).

The principal effect of the 1972 amendments on the Refuse Act was the replacement of the Refuse Act discharge permit program with the new NPDES permit program. Water Pollution Control Act Amendments of 1972, § 402(a)(4), 33 U.S.C. 1342(a)(4). Apparently to encourage prompt issuance of the new NPDES permits, the 1972 amendments provided that a pending permit application would immunize a discharger from prosecution — under the new amendments or under the Refuse Act — until December 31, 1974. Act, Section 402(k), 33 U.S.C. 1342(k). The fear thus was raised that under this provision defendants in prosecutions planned or pending when the amendments took effect could force dismissal of the Government's case merely by applying for an NPDES permit and achieving the immunity conferred by Section 402(k), 33 U.S.C. 1342(k). It was this fear that prompted inclusion of the Refuse Act in the savings clause of Section 4(a), not any belief that the amendments would repeal or preempt the Refuse Act. Section 4(a) did not save pending Refuse Act litigation from a supposed repeal of the Refuse Act; instead, § 4(a) saved pending Refuse Action litigation from the immunity possible under § 402(k), 33 U.S.C. 1342(k).⁵ The court therefore cannot draw the negative inference argued for by OMC. Refuse Act prosecution has not been precluded by the 1972 Amendments.⁶

As a second line of attack on Count I, OMC argues that any injunctive remedy the Refuse Act might have afforded before 1972 has not survived the 1972 amendments. In particular, OMC urges that injunctive relief never was available under the Refuse Act itself, but only as a judge-made remedy; such a judge-made remedy, as a species of federal common law, must have been preempted by the 1972 amendments. Milwaukee II. In support of its position OMC relies on three cases: United States v. Oswego Barge Corp., 664 F.2d 327 (2d Cir. 1981); United States v. Dixie Carriers, Inc., 627 F.2d 736 (5th Cir. 1980); and Steuart Transportation Co. v. Allied Towing Corp., 596 F.2d 609 (4th Cir. 1979).

Each of these cases involved an oil spill from a maritime vessel. Under Section 311(c) of the Clean Water Act, 33 U.S.C. § 1321(c), the United States may clean up oil spills and then recover its cleanup costs from the vessel owner. The same section limits the liability of the vessel owner. Section 311(f), 33 U.S.C. § 1321(f). In each of these cases the government cleaned up the oil spill and sought to recover its cleanup costs; however, the Government attempted to avoid the liability limitation of 33 U.S.C. § 1321(f) by suing as well under other theories, including the Refuse Act, which did not limit liability. Each court refused to permit additional recovery for cleanup costs under other theories, since such additional recovery would render meaningless the limited liability provision of Section 311(f), 33 U.S.C. § 1321(f).

Oswego, Dixie, and Steuart do not control the present case, in which the Government seeks injunctive relief, not unlimited recovery of cleanup costs. Those cases denied recovery under the Refuse Act because of the clear and absolute clash between limited recovery under the Clean Water Act and unlimited recovery under the Refuse Act based on the same standard of liability. Injunctive relief under the Refuse Act does not present so clear or absolute a clash with the Clean Water Act. It is true that in some cases the costs of compliance with an injunction might exceed the liability limitation under the Clean Water Act, but the court does not understand OMC to be arguing that this is likely to occur in the present case. It should be noted that Oswego and Steuart expressly reserve the question of whether injunctive relief under the Refuse Act survives the 1972 amendments. 664 F.2d at 343 n. 24; 596 F.2d at 618 n. 16. See also United States v. Oswego Barge Corp., 673 F.2d 47 (2d Cir. 1982) (on petition for rehearing). Oswego does, however, develop...