United States v. Stauffer Chemical Company

Citation464 U.S. 165,104 S.Ct. 575,78 L.Ed.2d 388
Decision Date10 January 1984
Docket NumberNo. 82-1448,82-1448
PartiesUNITED STATES, Petitioner, v. STAUFFER CHEMICAL COMPANY
CourtUnited States Supreme Court
Syllabus

When officials of the Environmental Protection Agency (EPA) and the State of Tennessee, accompanied by employees of a private firm under contract to EPA, attempted to inspect one of respondent's Tennessee plants, respondent refused entry to the private contractors unless they would sign an agreement not to disclose trade secrets. The private contractors refused to do so, and EPA later obtained an administrative warrant authorizing the private employees to conduct the inspection. After respondent refused to honor the warrant, the Government began a civil contempt proceeding against respondent in Federal District Court in Tennessee, and respondent moved to quash the warrant on the ground that private contractors are not "authorized representatives" under § 114(a)(2) of the Clean Air Act for the purposes of conducting inspections of premises subject to regulation under the Act. The court denied respondent's motion, and on appeal respondent reiterated its statutory argument and also asserted that the Government should be collaterally estopped from asserting that § 114(a)(2) authorizes private contractors to conduct inspections, because of a contrary decision of the Court of Appeals for the Tenth Circuit in a case involving the same parties which arose from respondent's similar refusal to allow private contractors, accompanying EPA and Wyoming officials, to enter and inspect one of respondent's Wyoming plants. The Court of Appeals in the present case reversed the District Court, agreeing with respondent both on the merits of the statutory issue and, alternatively, on the collateral-estoppel issue.

Held: The doctrine of mutual defensive collateral estoppel is applicable against the Government to preclude relitigation of the same issue already litigated against the same party in another case involving virtually identical facts. Cf. Montana v. United States, 440 U.S. 147, 99 S.Ct. 970, 59 L.Ed.2d 210. Pp. 169-174.

(a) The doctrine of collateral estoppel generally applies to preclude relitigation of both issues of law and issues of fact if those issues were conclusively determined in a prior action involving the same parties. The exception to the applicability of the principles of collateral estoppel for "unmixed questions of law" arising in "successive actions involving unrelated subject matter," Montana v. United States, supra, at 162, 99 S.Ct., at 978, does not apply here. Whatever the purpose or extent of the exception there is no reason to apply it here to allow the Government to litigate twice with the same party an issue arising in both cases from virtually identical facts. Pp. 169-172.

(b) Nor is an exception to the doctrine of mutual defensive estoppel justified here on the asserted ground that its application in Government litigation involving recurring issues of public importance will freeze the development of the law. That argument is persuasive only to prevent the application of collateral estoppel against the Government in the absence of mutuality. While the Sixth Circuit's decision prevents EPA from relitigating the § 114(a)(2) issue with respondent, it still leaves EPA free to litigate the same issue in the future with other litigants. Pp. 173-174.

684 F.2d 1174 (6th Cir.1982), affirmed.

Louis F. Claiborne, Washington, D.C., for petitioner.

Charles F. Lettow, Washington, D.C., for respondent.

JUSTICE REHNQUIST delivered the opinion of the Court.

In March of 1980, when the Environmental Protection Agency (EPA) tried to inspect one of respondent Stauffer Chemical Company's Tennessee plants using private contractors in addition to full-time EPA employees, Stauffer refused to allow the private contractors to enter the plant. Stauffer argues that private contractors are not "authorized representatives" as that term is used in § 114(a)(2) of the Clean Air Act, 42 U.S.C. (Supp. V) § 7414(a)(2). Stauffer also argues that the government should be estopped from relitigating the question of whether private contractors are "authorized representatives" under the statute because it has already litigated that question against Stauffer and lost in connection with an attempted inspection of one of Stauffer's plants in Wyoming. The Court of Appeals agreed with Stauffer on the merits and also on the collateral estoppel issue. Without reaching the merits, we affirm the Court of Appeals' holding that the government is estopped from relitigating the statutory issue against Stauffer.

On March 27, 1980, officials from EPA and the state of Tennessee, accompanied by employees of a private firm under contract to EPA, attempted to inspect Stauffer's elemental phosphorus production plant in Mt. Pleasant, Tenn. Stauffer refused entry to the private contractors unless they would sign an agreement not to disclose trade secrets. When the private contractors refused to do so, the entire group left without making the inspection. EPA later obtained an administrative warrant authorizing the private employees to conduct the inspection, and Stauffer refused to honor the warrant.

On the following day, EPA began a civil contempt proceeding against Stauffer in federal district court in Tennessee, and Stauffer simultaneously moved to quash the warrant. It argued that private contractors are not "authorized representatives" under § 114(a)(2) of the Clean Air Act for the purposes of conducting inspections of premises subject to regulation under that Act.1 The District Court denied Stauffer's motion to quash, accepting EPA's argument that the inspection authority conferred upon "authorized representatives" by the statute extends to private contractors retained by EPA. United States v. Stauffer Chemical Co., 511 F.Supp. 744 (M.D.Tenn.1981).

On appeal, Stauffer reiterated its statutory argument and also asserted that the government should be collaterally estopped on the basis of the decision in Stauffer Chemical Co. v. EPA, 647 F.2d 1075 (CA10 1981) (hereinafter Stauffer I ), from contending that § 114(a)(2) authorizes private contractors to conduct inspections of Stauffer's plants. In Stauffer I officials of EPA and the state of Wyoming, accompanied by employees of a different private firm under contract to EPA, attempted to conduct an inspection of Stauffer's phosphate ore processing plant near Sage, Wyoming. As in the present case, Stauffer insisted that the private contractors sign a nondisclosure agreement, and when they declined to do so, Stauffer refused to allow them to enter the plant. EPA obtained an administrative warrant authorizing the private contractors to conduct the inspection, and Stauffer refused to honor the warrant. Stauffer then instituted an action in United States District Court in Wyoming seeking to quash the warrant and to enjoin EPA from using private contractors in inspecting Stauffer's Wyoming plants. The District Court issued the injunction, and the United States Court of Appeals for the Tenth Circuit affirmed, holding that private contractors are not "authorized representatives" pursuant to § 114(a)(2). Id., at 1079.

The Sixth Circuit in the present case (hereinafter Stauffer II ) reversed the District Court, adopting alternate grounds for its decision. Judge Weick, who delivered the opinion of the court, agreed with the Tenth Circuit that private contractors are not authorized to conduct inspections under the Clean Air Act. United States v. Stauffer Chemical Co., 684 F.2d 1174, 1181-1190 (CA6 1982). Relying on Montana v. United States, 440 U.S. 147, 99 S.Ct. 970, 59 L.Ed.2d 210 (1979), he also held that the government was collaterally estopped by Stauffer I from litigating the statutory question again against Stauffer. 684 F.2d, at 1179-1181.2 Judge Jones wrote a separate opinion concurring on the collateral estoppel issue and concluding that it was inappropriate for the court to reach the merits. Id., at 1190-1192. Judge Siler also wrote separately, dissenting from Judge Weick's opinion on the collateral estoppel issue but concurring in his opinion on the merits. Id., at 1192-1193. For the reasons which follow, we agree that the doctrine of mutual defensive collateral estoppel is applicable against the government to preclude relitigation of the same issue already litigated against the same party in another case involving virtually identical facts. Accordingly, we affirm the judgment of the Court of Appeals without reaching the merits.

In Montana v. United States, 440 U.S. 147, 99 S.Ct. 970, 59 L.Ed.2d 210 (1979), we held that the United States was estopped from relitigating in federal court the question of whether the Montana gross receipts tax on contractors of public, but not private, construction firms violates the Supremacy Clause of the United States Constitution. A public contractor, financed and directed by the federal government, had already litigated that question in state court, and the Montana Supreme Court unanimously had upheld the tax. In approving the defensive use of collateral estoppel against the government in Montana, we first determined that there was mutuality of parties, see United States v. Mendoza, --- U.S. ----, 104 S.Ct. 568, 78 L.Ed.2d ----, at note 9, that the issue sought to be relitigated was identical to the issue already unsuccessfully litigated in state court, and that there had been no change in controlling facts or legal principles since the state court action. Id., at 155-162, 99 S.Ct., at 974-978.

We next looked to see whether there were any special circumstances warranting an exception to the otherwise applicable rules of preclusion. One exception which we mentioned as possibly relevant is the exception for "unmixed questions of law" arising in "successive actions involving unrelated subject matter." Id., at 162, 99 S.Ct., at 978; see United States v. Moser, 266 U.S. 236, 242, 45 S.Ct. 66, 67, 69...

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