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KFC Western v. Meghrig

 

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In this case the Ninth Circuit was called upon to address the scope and remedy of the citizen suit provision of the Resource Conservation and Recovery Act (RCRA), section 7002.[1] In a question of first impression, the Ninth Circuit allowed monetary recovery for clean-up costs under RCRA’s citizen suit provision for a hazard that had already been cleaned up when the plaintiff filed suit.

KFC purchased petroleum-contaminated property from the Meghrigs in 1975. While improving the property in 1988, KFC discovered the soil contamination and the City of Los Angeles ordered KFC to halt construction pending analysis of the soil. Tests confirmed the soil’s petroleum contamination and the Department of Health and Services ordered KFC to clean up the property. The cleanup was completed in early 1989 and KFC requested reimbursement from the Meghrigs in mid-1990, which the Meghrigs refused. KFC filed suit under section 7002 in 1992.

The district court granted the Meghrigs’ motion to dismiss the complaint because section 7002 only authorizes injunctive (that is, nonmonetary) relief and only when there is imminent and substantial endangerment to the public at the time the suit is filed. The Ninth Circuit reversed, relying largely on the analysis of an Eighth Circuit opinion, United States v. Aceto Agricultural Chemicals Corp.,[2] which held that the similarly-worded government suit provision applied to wholly past violations that had been remedied by EPA when the suit was filed. The Ninth Circuit’s opinion created a split in the circuits and the U.S. Supreme Court granted the Meghrigs’ petition for certiorari.

On appeal to the Ninth Circuit, the Meghrigs argued RCRA only provides a cause of action when there is an imminent and substantial endangerment present at the time the plaintiff files the complaint, rather than the time of the cleanup. The Meghrigs supported this contention with RCRA’s legislative history and a general argument that Congress intended to create a citizen suit cause of action only when the risk of harm is present. The Meghrigs cited Gwaltney of Smithfield, Ltd. v. Chesapeake Bay Foundation,[3] a Clean Water Act case, for the holding that citizen suit provisions require defendants be in violation at the time the suit is filed.

In rejecting these arguments, the Ninth Circuit chose to follow the Eighth Circuit’s interpretation of the similarly worded government suit provision of RCRA. The Eighth Circuit held that the imminent endangerment requirement limited “the reach of RCRA to sites where the potential for harm is great but not . . . the time for filing an action.” The Ninth Circuit concluded, from the wording of the provisions and legislative history, that Congress intended citizens and the government to have the same standards of liability under RCRA. Therefore, according to the court, the citizen suit provision should be interpreted to allow suits for sites that endangered the public or environment in the past or present.

The Meghrigs’ second argument was that RCRA only entitles citizens to an injunction or other non-monetary relief. The court responded that the statute’s authorization for the courts to take “such other action as may be necessary”[4] provides for reimbursement for cleanup costs. The Ninth Circuit also rejected the Meghrigs’ argument that the lack of a limitations period evidences the unavailability of reimbursement actions. The court reasoned that it could apply equitable defenses such as laches to lessen any inequity due to the lack of a limitations period.

In asserting its reading of the citizen suit provision, the Ninth Circuit stressed the consideration of public policy: “Prompt preventive action [is] the most important consideration.”[5] Thus, the court reasoned, RCRA should allow a plaintiff to clean up the contamination, and also subsequently file suit for reimbursement.

The U.S. Supreme Court reversed the judgment of the Ninth Circuit.


[1]42 U.S.C. § 6972 (1994).

[2]872 F.2d 1373 (8th Cir. 1989).

[3]484 U.S. 49 (1987).

[4]42 U.S.C. § 6972(a) (1994).

[5] KFC, 49 F.3d at 524 (quoting United States v. Price, 688 F.2d 204, 214 (3d Cir. 1982)).

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