Like invading hordes, plaintiffs have been seeking new ways to seize manufacturing assets—only they do it in court. The Manufacturers’ Center for Legal Action is seeing a rash of lawsuits alleging damages from activities that various government agencies have already approved under statutes enacted with bipartisan support and regulations that have balanced the interests of individuals, manufacturers and the public at large. These claims seek money from normal business activities that are fully permitted and regulated.
The latest threat is from landowners who sue manufacturing facilities that operate under emissions permits issued by a state or the Environmental Protection Agency (EPA), for damages from particulate matter or other pollution. While the Clean Air Act allows suits for permit violations, these new suits do not allege any violations of existing permits. For example, in Iowa, landowners sued a corn milling plant that had valid state and EPA permits. When the case went to the Iowa Supreme Court, the National Association of Manufacturers (NAM) filed a brief supporting the plant, arguing that the suit is a political question unsuitable for the courts, and in any case is preempted by federal regulation. However, that court decided that, even though a company is complying with federal and state environmental regulations, a landowner may still sue over the effects of the pollution, such as from dust, ash or unpleasant odors.
A similar suit in Pennsylvania against a power plant that was in compliance with federal and state regulations was initially dismissed by the trial court, but that decision was later reversed by an appeals court. The Supreme Court refused to hear that appeal, although we had urged them to.
Another suit alleging ground contamination near a North Carolina manufacturing plant site sought to impose damages above and beyond the cleanup obligations already required under the Superfund law. The NAM weighed in with an amicus brief in this case, and the Supreme Court decided not to authorize this expanded liability. While this win is reassuring, the case is another example of how manufacturers are being bombarded with lawsuits even though they are already complying with state and federal protocol.
Finally, we urged the Supreme Court to review a decision holding a company liable for MTBE (a fuel additive for gasoline engines) pollution-related injuries that have not actually happened in the groundwater of Queens, N.Y. The alleged contamination arose from using the safest feasible means of satisfying the federal oxygenation requirement for gasoline; yet, a lower court imposed retroactive liability on a company doing just that. Unfortunately, the Supreme Court declined to hear the case.
It’s enough to make you put up the barricades and call in the lawyers.