US v. Telluride Co.

• Decision Date: 02 May 1995
• Docket Number: Civ. A. No. 93-K-2181.
• Citation: 884 F. Supp. 404
• Parties: UNITED STATES of America, Plaintiff, v. The TELLURIDE COMPANY, Mountain Village, Inc. dba Telluride Mountain Village, Inc., and Telluride Ski Area, Inc., Defendants.
• Court: U.S. District Court — District of Colorado

884 F. Supp. 404

UNITED STATES of America, Plaintiff, v. The TELLURIDE COMPANY, Mountain Village, Inc. dba Telluride Mountain Village, Inc., and Telluride Ski Area, Inc., Defendants.

Civ. A. No. 93-K-2181.

United States District Court, D. Colorado.

May 2, 1995.

Robert H. Foster, Rebecca A. Lloyd, U.S. Dept. of Justice, Environmental Defense Section, Denver, CO, for plaintiff.

David S. Neslin, James E. Scarboro, Arnold & Porter, Denver, CO, for defendants.

MEMORANDUM OPINION AND ORDER

KANE, Senior District Judge.

Before me is Defendants' motion for partial summary judgment. Jurisdiction is based on 28 U.S.C. §§ 1331, 1345 and 1355 and 33 U.S.C. § 1319(b). I grant the motion.

I. Background.

This case is a civil enforcement action brought by the United States pursuant to section 309 of the Clean Water Act, 33 U.S.C. § 1319, seeking injunctive relief and civil penalties against the Telluride Company, Mountain Village Company, Inc., and Telluride Ski Area, Inc. (collectively, "Telco"), developers of the Telluride ski resort in Telluride, Colorado for violations of the Clean Water Act at a land development and ski resort property ("site") owned and developed by Telco.

The government first brought its allegations of illegal fill activities to Telco's attention no later than September 11, 1990 in a meeting between the United States Environmental Protection Agency ("EPA") and attorneys for Telco. (United States Br. Opp.Defs.' Mot.Partial Summ.J., Ex. 1 ¶ 3.) The United States and Telco negotiated a settlement in 1993. On October 15, 1993, the United States filed its original complaint simultaneously with a proposed consent decree. I rejected the proposed consent decree. United States v. The Telluride Co., 849 F.Supp. 1400, 1406 (D.Colo.1994). The United States moved to amend its complaint and, pursuant to court order, filed a revised amended complaint ("Complaint") on October 7, 1994.

The Complaint alleges the unpermitted discharges of dredged or fill materials into wetlands on the site in violation of sections 301 and 404 of the Act, 33 U.S.C. §§ 1311, 1344. Specifically, the Complaint alleges Telco, in developing the property, filled or caused to be filled over 60 acres of wetlands from 1981 through 1994. (Compl. ¶¶ 21, 22.)

Telco answered the Complaint on November 28, 1994. On December 20, 1994, Telco filed the instant motion for partial summary judgment on statute of limitations grounds. Trial is set for October 2, 1995.

II. Standards for Summary Judgment.

Summary judgment is proper where the pleadings, depositions, answers to interrogatories and admissions on file, together with any affidavits, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). In considering this motion, one must construe the factual record and reasonable inferences therefrom in the light most favorable to the non-moving party. Cone v. Longmont United Hosp. Ass'n, 14 F.3d 526, 528 (10th Cir.1994). The mere allegation of a factual dispute will not defeat a properly supported motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 2514, 91 L.Ed.2d 202 (1986). The non-moving party must point to specific facts, "by any of the kinds of evidentiary materials listed in Rule 56(c), except the mere pleadings themselves," to avoid summary judgment. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553.

III. Merits.

Telco argues I should grant partial summary judgment and bar claims based on the alleged discharge of fill materials into wetlands where the alleged discharge took place before October 15, 1988. Telco maintains the applicable statute of limitations, 28 U.S.C. § 2462, gives the government five years from the date of the violation to file a suit for civil penalties pursuant to the CWA, thus precluding claims on violations which occurred before October 15, 1988.

Section 2462 reads in relevant part: "Except as otherwise provided by Act of Congress, an action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise, shall not be entertained unless commenced within five years from the date when the claim first accrued...." 28 U.S.C. § 2462.

Telco asserts, pursuant to 28 U.S.C. § 2462, the government's claims accrued at the time the alleged violations were committed. Telco relies on 3M Co. v. Browner, 17 F.3d 1453 (D.C.Cir.1994) (rehearing and suggestion for rehearing en banc denied May 9, 1994). In that case, 3M petitioned for review of the EPA's assessment of civil penalties for violations of the Toxic Substances Control Act ("TSCA"). Actions for civil penalties under TSCA are also limited by 28 U.S.C. § 2462. 3M, 17 F.3d at 1455. The EPA had assessed civil penalties because 3M "had unwittingly committed several violations" of TSCA between August 1980 and July 1986. Id. at 1454. On September 2, 1988, the EPA filed an administrative complaint against 3M seeking $1.3 million in civil penalties under TSCA for failure to file Premanufacture Notices and for submitting inaccurate Customs certifications. Id. at 1455. 3M interposed a statute of limitations defense, claiming the EPA was barred from seeking civil penalties for violations which occurred before September 2, 1983 — more than five years before the complaint was filed. The Administrative Law Judge ("ALJ") denied 3M's defense. 3M appealed to the D.C. Circuit.

The D.C. Circuit reversed the ALJ and determined 28 U.S.C. § 2462 did apply to administrative proceedings for civil penalties. Id. at 1455-59. The court then considered "the meaning of § 2462's phrase `unless commenced within five years from the date when the claim first accrued.'" Id. at 1460. After analyzing the statute's history and application, and reviewing the nature of statutes of limitations in general, the court held "an action, suit or proceeding to assess or impose a civil penalty must be commenced within five years of the violation giving rise to the penalty." Id. at 1462. Thus the court precluded EPA from assessing penalties against 3M for any violations allegedly committed more than five years before EPA filed its administrative complaint.

The United States concedes 28 U.S.C. § 2462 applies to its claim for civil penalties but argues the provision is only a limited bar to its civil penalties claim here because (1) since Telco has not removed allegedly unlawful fill material, the violations are continuing; (2) the statute of limitations was equitably tolled during the negotiations process leading to the proposed consent decree; and (3) 28 U.S.C. § 2462 does not apply to claims for injunctive relief.

A. Continuing Violation.

The government argues the discharge of dredged or fill materials into waters of the United States is a "continuing violation" as long as the adverse effects of the fill continue. Accordingly, the government maintains the statute of limitations does not begin to run until the fill is physically removed. The government cites various cases in support of its contention, none of which addresses the issue of the "continuing violation" doctrine in the statute of limitations context.

In Sasser v. Administrator, 990 F.2d 127, 129 (4th Cir.1993), Sasser had discharged dredged and fill materials into wetlands without a permit in 1986. The EPA administrative law judge imposed a penalty and ordered injunctive relief in the form of site restoration. Sasser filed a petition for review, alleging the EPA lacked jurisdiction to determine liability or assess an administrative penalty because, at the time of the illegal discharge in 1986, EPA's only authorized method of recovering civil penalties was through a district court action. Although the Clean Water Act was amended in February 1987 to authorize EPA to assess administrative penalties, Sasser argued the EPA's assessment of a penalty in his case was an unlawful retrospective application of the 1987 amendment.

The Fourth Circuit rejected this argument, holding Sasser's violation of the Act to be "a continuing one. Each day the pollutant remains in the wetlands without a permit constitutes an additional day of violation." Id. at 129. Because Sasser's violations continued after the 1987 amendment, the EPA had acted within its jurisdiction.

The Sasser court was not concerned with whether the violation was continuing so as to bar the commencement of the statute of limitations, but whether it was continuing for the purpose of an amendment to the Act which came into force after the initial violation. The issue was not whether the EPA had belatedly prosecuted a stale claim but whether the EPA was authorized to prosecute such claim at all.

The United States also relies on North Carolina Wildlife Federation v. Woodbury, 29 Env't Rep.Cas. BNA 1941, 1989 WL 106517 (E.D.N.C.1989) ("NCWF"). That case concerned whether the court had subject matter jurisdiction in a citizen's suit. The court determined defendants' failure to remove unlawful fill from waters of the United States precluded them from arguing that the violations were "wholly past" and therefore no longer actionable under the citizen suit provision of the CWA, 33 U.S.C. § 1365.

As in Sasser, the NCWF court's reasoning concerning the continuing nature of the violations related to whether the court had subject matter jurisdiction, rather than whether the statute of limitations had run. The NCWF court noted, if subject matter jurisdiction were denied completely because a violation was regarded as "wholly past" the day after an illegal ditching, a citizen plaintiff would never be entitled to a day in court. Id. at 1943. To the contrary, in the statutes of limitation context, courts have held mere ongoing impact from past violations does not extend the period in which a plaintiff must file an action. McDougal v. County of Imperial, 942 F.2d...