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Lewis v. 300 West LLC

United States District Court, N.D. Illinois, Western Division

September 30, 2019

MICHAEL LEWIS AND GENEVA D. LEWIS, Plaintiffs,
v.
300 WEST LLC, et al. Defendants.

          MEMORANDUM OPINION AND ORDER

          John Robert Blakey, United States District Judge.

         Plaintiffs in this lawsuit sue under the Resource Conservation and Recovery Act (RCRA) for injunctive relief and damages arising from the contamination of their groundwater supply. Several Defendants have moved to dismiss Plaintiffs' complaint. For the reasons explained below, the Court denies three of the motions in full [36], [39], [51], and grants in part and denies in part the fourth [41].

         A. Factual Background[1]

         Plaintiffs Michael Lewis and Geneva D. Lewis own a piece of real property located at 4913 Ritz Road, in Marengo, Illinois. They purchased the property in April 2012 and have resided there ever since. At some point, they learned that their groundwater supply, a well, had been contaminated. They sue here for injunctive relief and compensatory and punitive damages.

         1. Procedural History

         Plaintiffs filed this lawsuit June 6, 2018. See [1]. Their initial complaint named 300 West LLC; The Arnold Engineering Co., d/b/a The Arnold Engineering Company; Arnold Magnetic Technologies Corporation, d/b/a Arnold Magnetic Technologies; Arnold Magnetic Technologies, LLC; Arnold Magnetic Technologies Holdings Corporation; Allegheny Technologies Incorporated, f/k/a Allegheny Technologies Inc.; Allegheny International, Inc.; Allegheny Ludlum Corporation, f/k/a Allegheny Ludlum Steel Corporation; Allegheny Ludlum, LLC; Flexmag Industries, Inc.; Arnold Magnetic Technologies; SPS Technologies, Inc.; Precision Castparts Corp.; Audax Group, LLC; Compass Group Diversified Holdings, LLC; and MPR Management Inc. [1] at p. 1. They asserted claims against all Defendants under the RCRA (count I), for negligence (count II), private nuisance (count III), and trespass (count IV). Id. at ¶¶ 45-77.

         Several Defendants-Precision Castparts Corp. [36]; 300 West LLC [39]; MPR Management, Inc. [51]; and Compass Group Diversified Holdings LLC, Arnold Magnetic Technologies Holdings Corporation, Arnold Magnetic Technologies Corporation, The Arnold Engineering Co., and Flexmag Industries [41]-moved to dismiss. In response, Plaintiffs voluntarily dismissed Allegheny Technologies Incorporated f/k/a Allegheny Technologies Inc.; Allegheny Ludlum, LLC, and Allegheny Ludlum Corporation, see [34]; they also voluntarily dismissed Arnold Magnetic Technologies, LLC and Audax Management Company, LLC, see [66]; and they amended their complaint as to the remaining Defendants, see [57].[2" name="FN2" id= "FN2">2]

         Plaintiffs' First Amended Complaint ("FAC") asserts the same claims as the original complaint. See Id. at ¶¶ 43-75. As a result, after Plaintiffs filed the FAC, the Defendants (who had previously moved to dismiss) advised that they wished to stand on their pending motions. See [61]. The parties, therefore, briefed the motions, and they are now ripe for resolution.

         2. Plaintiffs' Allegations

         Plaintiffs own and reside at 4913 Ritz Road, in Marengo, Illinois. [57], ¶ 12. The sole source of water on that property is a private well. Id. at ¶ 1- In June of 2013, the Illinois Department of Public Health notified Plaintiffs that water samples taken from their well revealed the presence of dangerous chemicals, including 1, 1-dichloroethene ("1, 1-DCE") and trichloroethene ("TCE"). Id. at ¶¶ 1, 9. Indeed, hazardous substances contaminate properties throughout and along Ritz Road in Marengo. Id. at ¶ 7. The source of the contamination is 300 N. West Street in Marengo, a site comprised of as many as 19 individual parcels situated on approximately 92.5 acres. Id. at ¶ 2. This site is currently owned by Defendant 300 West LLC and currently operated by Defendant Arnold Engineering Co. Id. at ¶ 3.

         The FAC alleges that contaminants from the Site "migrated in groundwater to contaminate the groundwater and soils of Plaintiffs' property, as well as the potable water well owned and used by Plaintiffs." Id. at ¶ 32-33. The FAC alleges that Defendant 300 West owns the Site, and that "each Defendant generated and/or transported materials containing hazardous substances to the Site." [57], ¶ 27, 31. More specifically, the FAC alleges the following as to each Defendant:

• Defendant Arnold (a moniker defined to include The Arnold Engineering Co., d/b/a The Arnold Engineering Company, its predecessors and/or successors, including but not limited to, Arnold Magnetic Technologies Corporation and Arnold Magnetic Technologies LLC, id. at ¶ 18, and possibly also Arnold Magnetic Technologies Holdings Corporation, see Id. at ¶ 17) owned and operated the Site from 1940 to 2006, when it sold the property to 300 West. Id. at ¶ 34. Plaintiffs allege, on information and belief, that 300 West leased the Site back to Arnold. Id. Plaintiffs allege that, since 1940, Arnold's operations on the Site have generated "solid wastes" or "hazardous wastes" within the meaning of the RCRA Id. at ¶ 35.
• From approximately 1946 to 1986, Defendant AI owned and operated Arnold, and/or controlled those processes and activities at the Site that generated such wastes. Id. at ¶ 36.
• From approximately 1986 to 2003, Defendant SPS, a predecessor of Defendant Precision, owned and operated Arnold and/or controlled those processes and activities at the Site. Id. at ¶37. And, from 2003 to 2005, Defendant Precision itself owned and operated Arnold and, through such ownership, controlled those processes and activities that generated such wastes and caused the contamination. Id.
• From approximately January 2005 to March 5, 2012, Defendant Audax Group owned Arnold Magnetic Technologies Corporation and managed, operated, and controlled those processes and activities. Id. at ¶ 38.
• On or about March 5, 2012, Defendant Audax Group sold Arnold Magnetic Technologies Corporation to [Compass Group Diversified Holdings LLC], which also controls Arnold Magnetic Technologies Holdings Corp. Id. at ¶¶ 39-40.
• From approximately 2006 to the present, Defendant MPR has been responsible for removal of the contamination at the Site and adjoining properties; yet, MPR has done nothing to remove contamination from Plaintiffs' property or to restore Plaintiffs' potable water supply. Id. at ¶ 41.

         Finally, the FAC alleges that:

[t]hrough their ownership, control, or operation of the Site, or ownership, control, or operation of the processes and activities generating solid waste on the Site, or their control or operation of efforts to remove Contamination from the Site and adjoining properties, Defendants have contributed or are contributing to the past or present handling, storage, or disposal at the Site of those "solid wastes" and "hazardous wastes," . . . and which handling, storage, or disposal have presented and may present an imminent and substantial endangerment to health or the environment within the meaning, and in violation, of 42 U.S.C. § 6972(a)(1)(B).

Id. at ¶ 42.[3]

         Plaintiffs seek relief under the citizen suit provision of the Resource Conservation and Recovery Act (RCRA), as amended, 42. U.S.C. § 6901 et seq. They also assert state law claims of negligence, private nuisance, and trespass. The FAC seeks injunctive relief, damages (compensatory and punitive), and disgorgement of profits.

         3. The Illinois Enforcement Action

         In the FAC, Plaintiffs acknowledge the existence of a prior state enforcement action relating to groundwater contamination at and from the Site, and they acknowledge the existence of a Consent Order executed by two named Defendants, 300 West and The Arnold Engineering Co. on June 1, 2016. [57], ¶¶ 57-59. They allege, however, that the remedies they seek fall outside the scope of a Consent Order executed in that action on or about June 1, 2016. Id. at ¶ 57. Plaintiffs claim that that Consent Order does not provide for any remedial response to, or otherwise address, the imminent and substantial endangerment presented by Defendants' failure to treat groundwater contamination. Id. at ¶ 58.

         By way of background as to the enforcement action, on May 14, 2013, at the direction of the Illinois Environmental Protection Agency ("EPA"), water samples were taken from thirteen private wells located near the Site, including from Plaintiffs' property. On June 6, 2013, the Illinois Department of Public Heath notified Plaintiffs that water samples from their property contained various Volatile Organic Compounds (VOCs), including 1, 1-dichloroethylene and trichloroethene [57-2]. The concentration of the VOCs exceeded their regulatory concentrations for drinking water, and the IDPH recommended that Plaintiffs not use their water for drinking, cooking, or bathing.

         On June 14, 2013, upon the request of the Illinois EPA, the State of Illinois, through the Illinois Attorney General, sued 300 West LLC and Arnold Engineering Co. in McHenry County Circuit Court, alleging violations of Section 43(a) of the Illinois Environmental Protection Act and seeking injunctive relief. [42-2]. In its state court complaint, the State alleged that The Arnold Engineering Co., a/k/a Arnold Magnetic Technologies Corporation, has, for approximately 100 years, owned and operated a manufacturing facility at the Site and historically "utilized chlorinated solvents in its product processes . . . ." Id. at ¶ 5. The state complaint alleged that, in or about June of 2003, Arnold sold the Site to 300 West, though Arnold continued to conduct manufacturing operations at the Site, operating on a lease from 300 West after the sale. Id. at ¶ 6. The state complaint described testing done at and near the Site and alleged that chlorinated VOCs released at the Site had migrated through the groundwater, contaminating residential wells; testing showed that chlorinated VOCs exceeded the Illinois Pollution Control Board's Class 1 Groundwater Quality Regulations in at least two drinking water wells, "thereby threatening the health and safety of the public." Id. at ¶ 26. The state complaint identified Plaintiffs' well, at 4913 Ritz Road, as one of the contaminated wells with a class 1 groundwater exceedance about the 7ppb standard for 1, 1-DCE and above the 5ppb standard for TCE.[4" name="FN4" id= "FN4">4] [42-2], p. 8.

         On June 1, 2016, the State of Illinois, 300 West, and The Arnold Engineering Co., executed a Consent Order to resolve the state enforcement action. See [42-4]. Without admitting the violations claimed in the State's complaint, Defendants agreed to: (1) continue to provide bottled water to certain private well owners, including Plaintiffs; (2) continue to conduct water sampling at those private wells; (3) perform all work necessary to hook up the affected properties to the City of Marengo's municipal water supply (including extending the City's water main and water lines, extending water lines from the water main to each property to hook up such properties to the municipal water main, installing a flush hydrant on Ritz Road, conducting any necessary confirmation sampling, providing restorative landscaping, sealing wells as necessary, and repairing any damage caused by any of the associated work. Id. at p. 15. 300 West and Arnold also agreed to pay all costs associated with this work and to pay each well owner $2, 400. Id. at pp. 15-16. 300 West and Arnold also agreed to pay a civil penalty of $100, 000 to the Illinois EPA, plus a penalty of $30, 000 for violations of prior orders; and to pay the Illinois EPA's costs ($70, 393.72) and the Illinois Attorney General's costs ($13, 892.44). Id. at pp. 7-8. The Consent Order provided that, if 300 West and Arnold failed to complete any obligation or failed to comply with their response and reporting obligations, they faced penalties of $300 per day for the first seven days, $500 per day for the next seven days, $750 per day for the next 15 days, and $1, 000 per day thereafter until they complied. Id. at p. 9. Finally, the Consent Order included provisions for a Remedial Action Plan to address soil and groundwater remediation. Id. at pp. 24-27.

         With regard to releases and waivers of claims, the Consent Order provided that affected well owners were not required to accept the offer to hook them into the City of Marengo's water, and that declining to hook up did not waive any potential causes of action, rights or remedies with regard to any alleged contamination. Id. at pp. 21-22. Additionally, the Consent Order provided that nothing therein waived, discharged, released, or otherwise impacted "any private causes of action or rights that may exist. . . ." Id. at p. 38.

         4. Defendants' Motions ...


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