Sackett v. EPA: Does It Signal the End of Coercive CERCLA Enforcement?
| Author | David A. Safranek |
| Pages | 1262-1296 |
Louisiana Law Review
Sackett v. EPA: Does It Signal the End of Coercive
CERCLA Enforcement?
A HYPOTHETICAL
Mr. Richards, the owner of a small auto-part manufacturing
company, purchases an old factory building in Michigan. He plans
to repurpose it, ideally without spending too much money.
Unbeknownst to Richards, the factory was previously owned by an
industrial chemical producer. After operating without incident for
five years, Richards begins to receive cease-and-desist notices from
the Environmental Protection Agency (EPA). The EPA alleges that
it has detected dangerous levels of chemicals in the soil under the
factory, and it believes that Richards’s company is to blame. The
EPA states that Richards may have violated the Comprehensive
Environmental Response, Compensation, and Liability Act
(CERCLA), a federal statute regulating the cleanup and remediation
of toxic waste sites.1 Settlement talks between Richards and the
EPA break down when Richards denies that his company had
“anything whatsoever to do with the release of those chemicals.”
Using its “Enforcement First” policy,2 the EPA issues Richards a
Unilateral Administrative Order (UAO) charging him with a
violation of CERCLA. Desperate, Richards makes a panicked call to
his lawyer, Norman Smith, and tries to find a way out. “Look,
Smith, can’t we just sue the EPA to get this order off our back?,”
Richards asks. “Nope. You’ve landed in a whole mess of trouble,”
Smith replies. “You have two choices—neither of them good. Either
you can foot the bill for the cleanup now and tr y to get
compensation later, or you can wait for the EPA to take us to court
with an enforcement action. Until then, we can’t fight this thing.”3
INTRODUCTION
The above hypothetical is based on a real case4 and illustrates
the profound difficulties faced by individuals and businesses issued
UAOs by the EPA under CERCLA. CERCLA explicitly denies any
Copyright 2014, by DAVID A. SAFRANEK.
1. See generally 42 U.S.C. § 103 (2006).
2. See Gen. Elec. Co. v. Jackson, 610 F.3d 110, 127–28 (D.C. Cir. 2010).
“[Plaintiff] GE points to EPA’s ‘enforcement first’ policy, by which the agency
issues UAOs whenever settlement negot iations fail . . . .” Id.
3. See 42 U.S.C. § 9606 (2006). The hypothetical is based in part on Solid
State Circuits, Inc. v. E.P.A., 812 F.2d 383 (8th Cir. 1987).
4. See Solid State Circuits, 812 F.2d 383.
1264 LOUISIANA LAW REVIEW [Vol. 74
access to pre-enforcement judi cial review of these EPA
administrative orders, which have the force of law.5 Those who
violate the terms of a UAO can be hit with massive fines that could
reach $25,000 a day.6 Because fines are calculated from the day the
UAO is issued, parties who refuse to comply could face multi-
million dollar contingent liabilities.7 Additionally, those who are
found to “willfully violate” a UAO “[w]ithout sufficient cause” are
subject to treble punitive damages.8
Not surprisingly, distressed regulated parties have repeatedl y
challenged the constitutionality of both CERCLA and the EPA’s
practice of issuing UAOs while allowing the potential fines and
penalties to accumulate, alleging violations of their due process
rights under the Fifth Amendment.9 Thus far, these challenges have
not proven successful.10 Indeed, prior to the U.S. Supreme Court’s
2012 decision in Sackett v. EPA, the judicial support for non-
reviewable administrative orders, including CERCLA UAOs,
seemed well settled and consistent across the majority of federal
circuits.11 The use of such orders extends well beyond CERCLA and
5. By “force of law,” it is meant that a UAO alone is sufficient to create a
cause of action for the EPA to bring suit in federal distric t court. See In re Katania
Shipping Co., 8 E.A.D. 294 (EAB 1999).
6. See § 9606(b)(1).
7. Id.
8. See id.; id. § 9607(c)(3). Punitive damages are capped at three times the
total response cost. Id. For example, if the total response cost is $2 billion, punitive
damages up to $6 billion may be sought by the EPA in an enforcement action.
9. Parties have challenged all of the follo wing: (1) the constitutionality of
treble punitive damages; (2) the constitutio nality of non-reviewable UAOs; and (3)
the pattern and practice of resorting to UAOs for enforcement in almost every
instance. See infra Part I.E.
10. See infra Part I.E. The only successful consti tutional challenge to
CERCLA UAOs to date occurred in Aminoil, Inc. v. E.P.A., in which the
California District Court granted a preliminary injunctio n against the EPA’s
imposition of daily fines against an oil company. See Aminoil, Inc. v. E.P.A., 599
subsequently superseded by statute when Congress amended CERCLA to
expressly prohibit the type of constitutional challenge brought by the plaintiffs in
that case. Id. See also JAMES T. O’REILLY, 1 SUPERFUND & BROWNFIELDS
CLEANUP § 7:5 (Sept. 2012 Update) (describing the effects of the 1986
amendments passed by Congress to expressly restrict pre-enforcement review of
CERCLA UAOs).
Rothschild, Before and After Sackett v. U.S. Environmental Protection Agency,
59-JUL FED. LAW. 46, 48 (2012) (“By 1995, the bar was so firmly in place that
the Tenth Circuit simply cited the opinions issued by the Seventh, Fourth, and
Sixth Circuit in its own three-page decision, stating that those cases were
indistinguishable and finding no reason to rule differently than those courts had.
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