United States District Court, C.D. Illinois, Springfield Division
E.O.R. ENERGY L.L.C., and AET ENVIRONMENTAL, INC., Plaintiffs,
ALEC MESSINA, as Director of Illinois Environmental Protection Agency, and ILLINOIS ENVIRONMENTAL PROTECTION AGENCY, Defendants.
MYERSCOUGH, U.S. District Judge.
cause is before the Court on the Motion to Dismiss First
Amended Complaint (d/e 18) filed by Defendants Lisa Bonnett,
as the former Director of the Illinois Environmental
Protection Agency (IEPA), and the IEPA. The suit was brought
against Bonnett in her official capacity. Pursuant to Federal
Rule of Civil Procedure 25(d), Bonnett's successor, Alec
Messina, is automatically substituted as a party.
Motion to Dismiss First Amended Complaint is GRANTED.
Plaintiffs have failed to allege an actual controversy and,
therefore, the Court lacks jurisdiction over Plaintiffs'
claims. Plaintiffs' First Amended Complaint is dismissed
without prejudice and with leave to replead.
September 2016, Plaintiffs E.O.R. Energy, L.L.C. (EOR) and
AET Environmental, Inc. (AET) filed the First Amended
Complaint. EOR is a small, independent oil and gas producer.
First Am. Compl. ¶10. EOR conducts what is called
“acidization, ” which EOR defines as the
introduction of various acidic solutions into oilfields to
enhance secondary and tertiary oil recovery. Id.
¶¶ 2, 3. AET is a material broker permitted under
the U.S. Environmental Protection Agency to handle,
transport, and store solid and hazardous wastes and permitted
by the U.S. Department of Transportation to handle,
transport, and store hazardous materials. Id. ¶
Illinois Department of Natural Resources (IDNR) issued Class
II underground injection control permits to EOR under the
Safe Drinking Water Act (42 U.S.C. § 300h). Id.
¶¶ 10, 15. These permits allowed EOR to operate oil
and gas production wells and related underground injection
and disposal wells on EOR oil leases located in Sangamon and
Christian Counties in Illinois. Id. On March 23,
2007, the IEPA filed a complaint before the Illinois
Pollution Control Board against EOR and AET alleging that EOR
and AET violated 42 U.S.C. § 300h-1, as codified in
Illinois by 40 C.F.R. 147.700, by arranging for the illegal
transportation of hazardous waste from Colorado to Illinois
and for injecting the hazardous waste without first obtaining
an IEPA-issued Class I hazardous waste disposal underground
injection permit. Id. ¶16.
September 2012, January 2013, and April 2013, the Pollution
Control Board issued orders purporting to find that EOR and
AET violated the state-authorized regulations implementing
the federal Safe Drinking Water Act and Resource Conservation
and Recovery Act (42 U.S.C. § 6901) injection bans by
injecting or otherwise introducing acid into EOR's Class
II and oil wells without a Class I permit. Id.
¶ 17. On December 15, 2015, IEPA issued demand letters
to Plaintiffs demanding over $10 million in penalties.
Id. ¶ 18.
do not mention in the First Amended Complaint that they
appealed the Pollution Control Board's final orders to
the Illinois Appellate Court, although that information is
contained in one of the demand letters Plaintiffs attached as
an exhibit to the complaint. See d/e 17-3. A court
may take judicial notice of documents in the public record
when ruling on a motion to dismiss under Rule 12(b)(6).
Olson v. Champaign Cnty., Ill., 784 F.3d 1093, 1096
n.1 (7th Cir. 2015).
administrative review, Plaintiffs argued that the IEPA and
the Pollution Control Board did not have jurisdiction because
(1) the acid material shipped into Illinois was not
“waste” or “hazardous waste” and (2)
only IDNR had jurisdiction to regulate injections into Class
II wells. The Fourth District Appellate Court rejected these
arguments. E.O.R. Energy, LLC v. Pollution Control
Bd., 2015 IL App (4th) 130443 (2015).
the appellate court agreed with the Pollution Control Board
that the acid material at issue constituted waste or
hazardous waste within the meaning of the Environmental
Protection Act (415 ILCS 5/3.220). Id. ¶ 80. In
addition, the court rejected Plaintiffs' argument that
the acid material injected into the Class II wells fell
within the exclusive regulatory jurisdiction of the IDNR
under the Oil and Gas Act. Id. ¶ 91.
appellate court noted that the General Assembly created a
comprehensive statutory structure-known as the Illinois
underground injection control (UIC) program-for the
regulation of underground injection of materials into wells.
E.O.R. Energy, 2015 WL App (4th) 130443, ¶ 83.
The Illinois UIC program was promulgated with federal
approval pursuant to the federal UIC program, which allows
states the option of implementing their own UIC programs that
comply with federal standards. Id. The federal UIC
program was promulgated under the Safe Drinking Water Act
and, to the extent the program deals with hazardous waste,
the Resource Conservation and Recovery Act. Id.
appellate court noted that the Illinois Environmental
Protection Act designated the IEPA as the implementing agency
for all purposes of the Safe Drinking Water Act, with the
exception of section 300h-4 of the Safe Drinking Water Act,
which provides the authority for federally approved state
programs relating to “(1) the underground injection of
brine or other fluids which are brought to the surface in
connection with oil or natural gas production or natural gas
storage operations, or (2) any underground injection for the
secondary or tertiary recovery of oil or natural gas.”
Id. ¶ 84. (quoting 42 U.S.C. § 300h-4
(2006)). “Illinois's package of UIC-related
statutes and regulations submitted to the federal government
for approval provided that Class II wells …be
regulated by the IDNR under the Oil and Gas Act. E.O.R.
Energy, 2015 WL App (4th) 130443, ¶ 84 (also noting
that Class II wells are known as
“oil-and-gas-related-injection wells”). The IEPA
was given the authority over hazardous-waste injection wells.
Id. (citing 35 Ill. Adm. Code 730.105 (2012).
appellate court found that the Oil and Gas Act provided the
IDNR authority only over Class II injections into Class II
injection wells, meaning that the IDNR's regulatory power
under the UIC program was limited to the injection of fluids
associated with oil and gas extraction. Id. ¶
87. Because the material injected in the case was not a Class
II fluid that the IDNR was authorized to regulate, and
because the material was an acid material that fell within
the Environmental Protection Act's definition of
“hazardous waste, ” the IEPA and the Pollution
Control Board had jurisdiction over the injection.
Id. ¶ 88. The fact that the material was
injected into a Class II well did not matter for
jurisdictional purposes. Id.
First Amended Complaint, Plaintiffs seek a declaratory
judgment interpreting and declaring Plaintiffs' rights
and obligations under the Safe Drinking Water Act and the
Resource Conservation and Recovery Act as codified and
applied in Illinois. Specifically, Plaintiffs ask this Court
to declare and order that (1) under federal law, Class II
injection wells in Illinois are subject only to IDNR
regulation and permit requirements, per the express
provisions of the Safe Drinking Water Act and Resource
Conservation and Recovery Act, as codified at 40 C.F.R.
§ 147.700 and 701; and (2) under federal law, the IEPA
and the ...