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City of Waukegan, Illinois v. National Gypsum Co.

April 7, 2008

CITY OF WAUKEGAN, ILLINOIS, PLAINTIFF,
v.
NATIONAL GYPSUM CO.; BOMBARDIER MOTOR CORP. OF AMERICA; LAFARGE NORTH AMERICA, INC.; LAFARGE BUILDING MATERIALS INC., F/K/A BLUE CIRCLE, INC.; ST. MARY'S CEMENT, INC.; AND WAUKEGAN PORT DISTRICT, DEFENDANTS.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge

MEMORANDUM OPINION AND ORDER

In this action under the Comprehensive Environmental Response Compensation and Liability Act of 1980 (CERCLA) and the Illinois Water Pollutant Discharge Act (IWPDA), the City of Waukegan has sued several entities for damages and declaratory relief connected with contamination in Waukegan Harbor. In its amended complaint, Waukegan alleges that the harbor is contaminated with polychlorinated biphenyls (PCBs) that were discharged into and around the harbor by the now-defunct Outboard Marine Corp. (OMC), a marine products manufacturer. Am. Compl. ¶¶ 12-14. In the 1980's, the United States Environmental Protection Agency (USEPA) put the harbor and some of the surrounding land (the Site) on the National Priorities List (NPL), id. ¶ 15, the "list of national priorities among the known releases or threatened releases of hazardous substances, pollutants, or contaminants throughout the United States and its territories." See http://www.epa.gov/superfund/sites/npl/ (visited Apr. 6, 2008). "The NPL is intended primarily to guide the EPA in determining which sites warrant further investigation." Id.

In 1992, OMC completed a remediation project that involved dredging, treating, and disposing of around a million pounds of PCB-contaminated sediments. Am. Compl. ¶ 16. In 2000, OMC closed its plants in the area of the harbor and filed for bankruptcy. Id. ¶ 17. Waukegan alleges that in 2002, it took title to a portion of the Site known as the Waukegan Coke Plant property, and that in 2005, it took title to another portion of the Site known as the OMC North Plant. Id. ¶ 18. Waukegan contends that despite the remediation, PCB contamination persists in harbor sediments at levels above the current regulatory limit. Id. ¶ 19.

Defendants National Gypsum Corp., Bombardier Motor Corp. of North America, LaFarge North America Inc., LaFarge Building Materials, Inc., and St. Mary's Cement, Inc. are entities with business operations adjacent to the harbor. Id. ¶¶ 5-9. Waukegan alleges the following as to National Gypsum, the LaFarge entities, and St. Mary's: as part of [defendants'] normal business operations, large deep draft cargo vessels have caused prop wash which have [sic] routinely disturbed, suspended redistributed PCB-contaminated sediments throughout the Harbor. Such disturbances have mixed sediments into the water column, disrupted the benthic zone, and influenced Harbor water quality, thus exacerbating the PCB contamination in the Harbor.

Id. ¶¶ 20-23.*fn1 Waukegan alleges the following as to Bombardier: a part of Bombardier's normal business operations, it operates a submerged engine testing facility. The propellers in the testing facility have caused prop wash which have [sic] routinely disturbed, suspended redistributed PCB-contaminated sediments throughout the Harbor. Such disturbances have mixed sediments into the water column, disrupted the benthic zone, and influenced Harbor water quality, thus exacerbating the PCB contamination in the Harbor.

Id. ¶ 24. According to the amended complaint, the Waukegan Port District "is a special purpose unit of government created pursuant to the Waukegan Port District Act, 70 ILCS 1865/3, and [whose] territory includes portions of the Harbor." Id. ¶ 10. Waukegan alleges that "[a]ll of the Defendants owned and/or operated land within the Facility at the time of disposal or where contaminants have come to be located." Id. ¶ 25. It alleges that disposal of PCBs, a hazardous substance, occurred during times when each defendant owned and/or operated the Facility;*fn2 there have been releases and threatened releases of those hazardous substances into the environment; and this has caused Waukegan to incur response costs within the meaning of CERCLA, including costs for design of a dredging project aimed at the removal of PCBs from the Harbor. Id. ¶¶ 30-34. Waukegan thus alleges that each of the defendants is jointly and severally liable to the city for those costs already incurred, and it also seeks a declaratory judgment of liability for future response costs. Id. ¶¶ 35-36. It seeks to recover these costs and obtain the requested declaratory judgment. Waukegan makes similar allegations in its IWPDA claim.

Each of the defendants has moved to dismiss Waukegan's claims pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons stated below, the Court grants the motions of all defendants other than Bombardier but denies Bombardier's motion.

Discussion

A. CERCLA Claims

Under section 107(a) of CERCLA, various categories of persons and entities are liable for "necessary costs of response" incurred by any other person or entity consistent with the "national contingency plan," a phrase defined by the statute to denote sites identified by the USEPA as requiring cleanup. See 42 U.S.C. § 9607(a); id. § 9601(31) (definition of "national contingency plan"). The categories of those liable include "the owner and operator of a vessel or a facility [and] any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of . . . from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance . . . ." Id. § 9607(a)(1) & (2). A "facility" includes "any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located." Id. § 9601(9). A "[r]elease" is defined in CERCLA to include, with exceptions irrelevant in this case, "any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment." Id. § 9601(22).

In its amended complaint, Waukegan alleges that each of the defendants was an owner "and/or" an operator of the Site at relevant times, Am. Compl. ¶ 25, leaving it a bit ambiguous whether it contended that each defendant was potentially liable in both of those capacities. In its response to the motions to dismiss, however, Waukegan has made it clear that it seeks to impose liability against each of the defendants as both owners and operators.

1. Waukegan Port District

a. Liability as Owner

The Port District argues that it is neither an owner nor an operator of the Site. With regard to ownership, the Port District contends that the site is owned either by the State of Illinois or by the City of Waukegan itself. Under the Illinois Municipal Code, a city like Waukegan has the power to acquire, build, and operate a harbor within its jurisdiction and in adjacent public waters. 65 ILCS 5/11-92-2. To this end, a separate provision of the Municipal Code states that "[a]ll right, title and interest of the State of Illinois in and to submerged lands, naturally and artificially made or reclaimed lands, both within the boundaries of the harbor and adjoining its outer or water side, are hereby vested in the city or village for harbor and other public purposes, and the same shall be under the jurisdiction of the city or village." Id. 11-92-5. There is some authority that can be read to suggest that to actually acquire title to such property from the State for purposes of operating a harbor, a municipality must adopt an appropriate ordinance as outlined in a separate provision of the Municipal Code. See id. 11-92-7; Village of Gulfport v. Huebner, 114 Ill. App. 3d 1, 8-9, 251 N.E.2d 905, 908-09 (1969). The Court has no information at present regarding whether Waukegan has adopted such an ordinance. The Port District argues, however, that this is of no consequence; if the submerged lands under the harbor are not owned by Waukegan, they are still owned by the State of Illinois. Either way, the Port District contends, it is not an owner of this property.

In response, Waukegan relies on the Waukegan Port District Act (WPDA), in which the Illinois legislature created the Port District as a municipal corporation embracing a portion of the territory that lies within the Site. 70 ILCS 1865/3. The WPDA provides that the Port District has certain enumerated rights and powers, including the powers to issue construction and excavation permits for work in and near the harbor; remove obstructions in navigable waters; establish dock lines and shore lines; regulate anchorage, moorage, and speed of waterborne vessels and regulate bridge operations; build and operate terminal and port facilities; lease "areas within the lands held by it or acquired by it" to private parties for development; establish and operate airport facilities within its corporate limits; and to "[p]olice its property and exercise police powers in respect thereto." Id. 1865/4.1 - 4.15. The WPDA also provides that the provisions of the Illinois Municipal Code "shall not be effective ...


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