Case summaries.

• Position: Case overview

1. ENVIRONMENTAL QUALITY

   1. Comprehensive Environmental Response, Compensation, and Liability Act

      (1.) Kotrous v. Goss-Jewett Company of Northern California, 523 F.3d 924 (9th Cir. 2008).

      Plaintiffs--James Kotrous and Adobe Lumber--brought two separate actions to recover costs associated with cleanup of soil and groundwater contamination caused by prior landowners and site users. Plaintiffs incurred the costs voluntarily and sought contribution under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). (1) Relying on the Ninth Circuit's holding in Pinal Creek Group v. Newmount Mining Corp. (Pinal Creek), (2) which entitled potentially responsible parties (PRPs) to seek contribution under section 107 of CERCLA, (3) the district courts in both actions denied defendants' motions for dismissal. (4) Defendants filed separate interlocutory appeals) Addressing both appeals in a single opinion, the Ninth Circuit concluded that the United States Supreme Court's recent decision in United States v. Atlantic Research Corp. (6) overruled the Ninth Circuit's previous holding in Pinal Creek. Under Atlantic Research, PRPs not subject to a CERCLA section 106 or 107 action who voluntarily incur cleanup costs may seek recovery from other PRPs under section 107 but may not seek contribution under section 113. (7) Consequently, the Ninth Circuit vacated the district court judgments denying the defendants' dismissal motions and remanded the cases for further proceedings.

      Section 107(a) of CERCLA authorizes suits against statutorily defined "responsible parties" to recover costs incurred in cleaning up hazardous waste sites. CERCLA also expressly provides a cause of action for contribution from responsible parties and PRPs under section 113. (8) In Pinal Creek, the Ninth Circuit held that section 113 merely clarified an existing claim for contribution implied by section 107 and that PRPs could only seek contribution, but not cost recovery, from other PRPs under section 107. In 2004, the Supreme Court decided Cooper Industries, Inc. v. Availl Services, Inc. (Cooper industries), (9) holding that a private party who has not been sued under sections 106 or 107(a) could not sue for contribution under section 113 from other PRPs. Cooper industries, however, left open the question of whether section 107(a) provides PRPs with a cause of action to recover costs from other PRPs. (10) The Supreme Court later answered that question in the affirmative in Atlantic Research, holding that any private party, including a PRP, who has not been subject to a section 106 or 107 action is entitled to seek cost recovery under section 107. (11) Atlantic Research thus undermined the Ninth Circuit's holding in Pinal Creek "that an action between PRPs is necessarily for contribution" and prompted the court to reexamine CERCLA jurisprudence in the circuit. (12)

      Plaintiffs Koutrous and Adobe Lumber, landowners of sites contaminated by operations of dry cleaning businesses and other PRPs, but who were not themselves the subject of CERCLA suits, brought separate actions under sections 107 and 113 prior to the Supreme Court's decision in Atlantic Research. Koutrous sought recovery of contribution and costs under section 107(a), and contribution under section 113. The district court rejected defendant's motion for judgment on the pleadings, concluding that, under Pinal Creek, Koutrous had stated a claim for contribution under CERCLA section 107(a). The district court, however, .granted defendant's motion for interlocutory appeal on the issue of whether Kotrous, as a PRP, could request contribution under section 113 without first being sued under sections 106 or 107(a). Similarly, Adobe Lumber, plaintiff in the second action, sought contribution for costs under sections 107 and 113. The district court, noting that several similar CERCLA cases had reached the Ninth Circuit, denied defendants' motion to dismiss, but granted defendants' motion for an interlocutory appeal and stayed discovery proceedings.

      On appeal, the Ninth Circuit reviewed the district courts' statutory interpretations and decisions regarding dismissal and judgment on the pleadings de novo. (13) Noting that the Supreme Court's holding in Atlantic Research that a PRP may sue for cost recovery under section 107 undermined the holding in Pinal Creek that an action between PRPs is necessarily for contribution, the Ninth Circuit held that Atlantic Research had effectively overruled Pinal Creek. Under Atlantic Research, a PRP that incurs costs voluntarily, without being sued under sections 106 or 107, may bring a suit for recovery of its costs under section 107(a). However, such a PRP must seek recovery under section 107, not contribution under section 113, because section 113 grants an explicit right to contribution only to PRPs with liability stemming from an action under sections 106 and 107(a). Consequently, the court held that Kotrous could seek cost recovery under section 107, but was not entitled to seek contribution under section 113. Similarly, Adobe's claim for contribution under section 107 could no longer stand under Atlantic Research. The court vacated the orders of the district courts and remanded for proceedings consistent with its holdings, noting that plaintiffs should, on remand, be granted leave to amend their complaints.

      In conclusion, the Ninth Circuit consolidated both appeals for review, vacated the district courts' orders denying defendants' motions to dismiss, and remanded the cases to the district courts for proceedings consistent with the Ninth Circuit's holding, based on Atlantic Research, that PRPs that incur costs voluntarily may bring a suit for recovery of its costs under CERCLA section 107(a), but may not seek contribution under section 113.

   2. National Environmental Policy Act

      1. Geertson Seed Farms v. Johanns, 541 F.3d 938 (9th Cir. 2008).

         Conventional alfalfa growers Geertson Seed Farms and Trask Family Seeds, along with numerous consumer and environmental advocacy organizations (collectively Geertson), (14) brought suit in February 2006 against officials at the United States Department of Agriculture (USDA), the United States Environmental Protection Agency (EPA), and the USDA's Animal and Plant Health Inspection Service (APHIS) (collectively Defendants), alleging violations of the National Environmental Policy Act of 1969 (NEPA) (15) and other federal statutes. In February 2007, the district court held that APHIS violated NEPA by deregulating genetically engineered alfalfa (Roundup Ready alfalfa) without first preparing an environmental impact statement (EIS) and issued a permanent injunction barring future planting of genetically engineered alfalfa until APHIS's completion of an EIS. (16) The Ninth Circuit affirmed, holding that the district court correctly issued the permanent injunction and correctly decided not to conduct an evidentiary hearing prior to issuing an injunction.

         Monsanto Company (Monsanto) is a large-scale manufacturer of chemical products, including herbicides and pesticides. Monsanto developed lines of Roundup Ready alfalfa, which are resistant to one of the company's leading herbicides, Roundup. Monsanto licensed the technology to Forage Genetics as the exclusive developer of Roundup Ready alfalfa seed.

         APHIS, a division of USDA, is authorized to regulate "the introduction of organisms and products altered or produced through genetic engineering that are plant pests or are believed to be plant pests," which are also known as "regulated articles." (17) After APHIS initially classified Roundup Ready alfalfa as a regulated article, Monsanto petitioned APHIS, asking the agency to deregulate the Roundup Ready alfalfa. In response, APHIS published notice in the Federal Register, seeking public comment on the proposed deregulation. The notice explained that APHIS prepared an environmental assessment (EA) in accordance with NEPA that addressed the threat of genetic contamination of conventional alfalfa. Because of the presence of mandatory buffer zones around organic farming operations, the EA concluded it was "unlikely that Roundup Ready alfalfa would have a significant impact on organic farming." (18)

         Of the 663 public comments received in response to the notice, 520 opposed Monsanto's petition and 137 supported the deregulation of Roundup Ready alfalfa. The alfalfa growers and seed producers who supported the petition argued there was a demand for weed-free alfalfa. Conversely, opponents of the petition expressed concern about inadvertent gene transmission and the possibility that markets might not accept contaminated alfalfa, which farmers could not guarantee to be free from genetic engineering. Opponents further advocated for APHIS to conduct an EIS to analyze the environmental effects of a range of alternatives. In June 2005, APHIS made a finding of no significant impact and unconditionally deregulated Roundup Ready alfalfa. (19)

         Fearing that cross-pollination with Roundup Ready alfalfa would cause genetic contamination of conventional alfalfa, Geertson filed suit in federal district court, seeking to enjoin all future planting and harvesting of Roundup Ready alfalfa until APHIS completed an EIS. After conducting a hearing on the parties' cross-motions for summary judgment, the district court held APHIS "failed to take the required 'hard look'" demanded by NEPA regarding the extent to which the unconditional deregulation of Roundup Ready alfalfa would lead to genetic contamination of conventional alfalfa. (20) Monsanto and Forage Genetics joined with Defendants at the remedies phase and requested that planting of Roundup Ready alfalfa go forward subject to certain mitigating conditions.

         At the remedies stage, the district court held two hearings on the scope of injunctive relief and considered "voluminous evidentiary submissions from both sides." (21) Geertson sought to enjoin all future planting and...