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FMC Corp. v. United States Environmental Protection Agency

United States District Court, W.D. New York

January 31, 2017



          WILLIAM M. SKRETNY United States District Judge


         In this action, Plaintiff FMC Corporation seeks a declaration of rights and obligations in connection with an environmental remediation project in Middleport, New York. Presently before this Court is Defendant United States Environmental Protection Agency's (“EPA”) Motion to Dismiss FMC's complaint for lack of subject-matter jurisdiction and for failure to state a claim upon which relief can be granted, pursuant to Rules 12(b)(1) and (6) of the Federal Rules of Civil Procedure. (Docket No. 7.) For the following reasons, EPA's motion is granted, and FMC's complaint is dismissed for lack of subject-matter jurisdiction.


         This Court assumes the truth of the following factual allegations contained in FMC's complaint. See Hosp. Bldg. Co. v. Trs. of Rex Hosp., 425 U.S. 738, 740, 96 S.Ct. 1848, 48 L.Ed.2d 338 (1976); see also Hamilton Chapter of Alpha Delta Phi, Inc. v. Hamilton Coll., 128 F.3d 59, 63 (2d Cir. 1997).

         FMC is a Delaware corporation, with its principal place of business in Philadelphia, Pennsylvania. (Complaint, ¶ 13.) It is registered to conduct business in New York and operates a pesticide facility in Middleport, New York. (Complaint, ¶ 13.) Pertinent here, FMC is engaged in the cleanup of soil that contains elevated levels of arsenic from FMC's previous industrial activity. (Complaint, ¶ 1.) These efforts are aimed at remediating soils found to contain arsenic in concentrations exceeding the range or distribution of naturally occurring arsenic found in unpolluted comparison samples, i.e., soils unaffected by previous industrial activity. (Complaint, ¶ 1.)

         In early October 1990, the EPA and the New York State Department of Environmental Conservation (“NYSDEC”) delivered a draft unilateral order to FMC that directed FMC to assess, characterize, and, if necessary, remediate historic contamination at its facility and affected off-site areas. (Complaint, ¶¶ 2, 18.) This order was premised under the authority of section 3008(h) of the Resource Conservation and Recovery Act (“RCRA”), and section 71-2727(3) of the New York State Environment Conservation Law (“NYECL”). (Complaint, ¶ 19.)

         One month later, FMC formally responded to the EPA and requested a hearing under section 3008(h) of RCRA. (Complaint, ¶ 20.) That hearing was then postponed while FMC, EPA, and NYSDEC engaged in settlement discussions. (Complaint, ¶ 20.) Those discussions lasted nearly a year, culminating in a written Administrative Order on Consent (“AOC”) agreed to among FMC, EPA, and NYSDEC. (Complaint, ¶¶ 2, 21.) The AOC settled the administrative enforcement action that had commenced with the draft unilateral order. (Complaint, ¶ 2.)

         The AOC established “the terms on which FMC would implement interim corrective measures, an initial study of the need for further corrective measures . . . and a study of the nature of final corrective measures . . . for the Facility and off-site areas.” (Complaint, ¶ 21.) The AOC contemplates that a corrective measures study (“CMS”) would contain an evaluation of corrective measure alternatives based on specific criteria set forth in the AOC and corrective action objectives (“CAOs”) to be developed after execution of the AOC. (Complaint, ¶ 22.) Additionally, the AOC provides that the CMS report would include a recommended corrective measure alternative as the final corrective action. (Complaint, ¶ 22.) The AOC also provides that EPA would “select the corrective measure alternative or alternatives to be implemented based upon the results of FMC's work.” (Complaint, ¶ 23.)

         Since 1991, FMC, EPA, and NYSDEC have followed the corrective action process set forth in the AOC. (Complaint, ¶ 26.) For example, FMC implemented seven interim corrective measures at some 37 properties within certain contaminated sites-known as operable units 2, 4, and 5-with EPA's and NYSDEC's oversight and approval. (Complaint, ¶ 27.) Operable units 2, 4, and 5 are all outside FMC's facility and consist of many residential properties, several commercial properties, undeveloped properties, the “Culvert 105 area, ” and the Royalton-Hartland school. (Complaint, ¶ 3.)

         In addition to the interim corrective measures, FMC also performed RCRA facility investigations for operating units 2, 4, and 5, consisting of environmental sampling and other investigative measures designed to determine the nature and extent of contamination. (Complaint, ¶ 29.) FMC then submitted summaries of the findings to EPA and NYSDEC. (Complaint, ¶ 29.)

         Thereafter, in 2008, EPA and NYSDEC began consulting with FMC regarding the development of corrective action objectives (“CAOs”). (Complaint, ¶ 30.) In March 2009, EPA and NYSDEC adopted a final set of CAOs to govern work under the AOC. (Complaint, ¶ 30.)

         In September 2009, EPA and NYSDEC approved FMC's RCRA facility investigation summaries. (Complaint, ¶ 31.) Based on the information in the summaries, EPA and NYSDEC determined that a corrective measures study was warranted for, among other areas, operating units 2, 4, and 5. (Complaint, ¶ 31.) The corrective measures study was intended to develop and evaluate a corrective measure alternative or alternatives and to recommend the final corrective measure or measures for operating units 2, 4, and 5. (Complaint, ¶ 31.) Upon completion of the corrective measures study, the AOC provided that EPA would select the corrective measures to be taken based on the corrective measures study analysis and report. (Complaint, ¶ 33.)

         FMC, EPA, and NYSDEC worked together to formulate a corrective measures work plan for operating units 2, 4, and 5, namely the “Corrective Measures Study Work Plan for Suspected Air Deposition and Culvert 105 Study Areas” (“Final CMS Work Plan”). (Complaint, ¶ 34.) FMC completed the corrective measures study in accordance with the Final CMS Work Plan. (Complaint, ¶ 35.) It then submitted a preliminary report to EPA and NYSDEC, which, after a comment and revision period, became the Final Corrective Measures Study Report containing more than 10, 000 pages. (Complaint, ¶ 35.) This final report evaluated eight corrective measures alternatives developed by FMC with input and direction from EPA and NYSDEC, as well as from community stakeholders. (Complaint, ¶ 36.) FMC believed that EPA would select a final remedy from one of these eight options, in accordance with the AOC.

         But on June 11, 2012, NYSDEC, not EPA, published a Draft Statement of Basis, which purported to select the final remedy for operating units 2, 4, and 5, which was not one of the eight options contained in the Final Corrective Measures Study Report. (Complaint, ¶¶ 37, 38.) Instead, the NYSDEC's remedy is based on state law. (Complaint, ¶ 50.) That remedy is referred to in this litigation as CMA 9.

         FMC objects to CMA 9 not only because it is procedurally contrary to the AOC but also because the selected remedy was never studied or considered under the AOC and is a more expensive, less desirable option than any of the eight studied remedies. (Complaint, ¶¶ 4, 5, 6.) NYSDEC issued a Statement of Basis on May 28, 2013, announcing CMA 9 as the final corrective measure for operable units 2, 4, and 5. (Complaint, ¶ 50.)

         FMC unsuccessfully pursued its objections administratively with EPA and NYSDEC. (Complaint, ¶¶ 40-42, 49.) After NYSDEC issued the Statement of Basis, FMC continued discussions with NYSDEC in an attempt to find mutual agreement on a final remedy. (Complaint, ¶ 51.) Those discussions were also unsuccessful, which resulted in FMC petitioning EPA to set aside the Statement of Basis for several reasons. (Complaint, ¶¶ 52, 53.) EPA, however, declined to consider FMC's petition in a May 22, 2014 letter, finding that FMC could not properly invoke the dispute-resolution provisions in the AOC, because those provisions do not cover selection of the final corrective measure. (Complaint, ¶ 56.) Thereafter, FMC commenced an Article 78 proceeding in state court to review NYSDEC's actions. (Complaint, ¶ 58.)

         FMC also brings this action seeking a declaration of the rights and obligations of FMC and EPA under the AOC. In its five claims for relief, FMC requests that this Court declare:

1) that the AOC governs selection of the corrective measure alternatives for the Middleport Corrective Action Site (Complaint, ¶ 68);
2) that EPA will select the corrective measure alternative or alternatives and that the selection must be based upon the results of Tasks IX and X conducted under the AOC . . . [and] that the standards for that selection are those provided by the agreed standards of the AOC, the CAOs, ...

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