CSX Transp. v. Spiniello Glob.

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CSX TRANSPORTATION, INC. Plaintiff, v. SPINIELLO GLOBAL, INC., et al., Defendants.

Civil No. JKB-19-2976

United States District Court, D. Maryland

August 25, 2023

MEMORANDUM

JAMES K. BREDAR CHIEF JUDGE

Plaintiff CSX Transportation, Inc. ("CSX") owns and operates a coal shipment facility (the "Facility") at Curtis Bay in Baltimore, Maryland. In 2014, CSX entered into a Right of Entry Agreement with the City of Baltimore to allow the City to update and repair the sewage lines running under the Facility. CSX initiated this action against Spiniello Global Inc., Spiniello Companies, Inc. (collectively "Spiniello") and the Mayor and City Council of Baltimore (the "City" and, collectively with Spiniello, the "Defendants") to recover costs for remediation it conducted after Spiniello, working as a subcontractor for the City, allegedly dumped sewage-contaminated water at the Facility. (See generally Compl., ECF No. 1.) CSX asserts claims for Breach of Contract (Count IV) and Indemnification (Count V) against the City,^[1] and for Negligence (Count IX) and Trespass (Count X) against Spiniello.^[2] (Id.)

Currently pending before the Court are Motions for Summary Judgment filed by Spiniello (ECF No. 103) and CSX against the City. (ECF No. 105.) Also pending are several Motions related to various discovery and evidentiary issues, including Defendants' Motion to Dismiss for Spoliation of SCADA Data (ECF No. 90); Defendants' Motion to Dismiss for Failure to Disclose and Supplement Material Evidence (ECF No 91);. Spiniello's Motion to Dismiss for Witness Tampering and Obstruction (ECF No. 92); Defendants' Motion to Dismiss for Spoliation of Communications to Coal Owners (ECF No. 93); Defendants' Motion to Strike Plaintiffs Expert Kiernan Purcell Pursuant to Federal Rule of Evidence 5-702 (ECF No. 95); Defendants' Motion to Strike Plaintiffs Expert Kiernan Purcell for Conducting Prohibited and Untimely Fact Discovery (ECF No. 96); Defendants' Motion to Strike Plaintiffs Expert John Shaw for Conducting Prohibited and Untimely Fact Discovery (ECF No. 97); Defendants' Motion in Limine to Exclude Testimony or Evidence Regarding Any Incidents Now Precluded by the Local Government Tort Claims Act and the Statute of Limitations (ECF No. 99); Defendants' Motion to Strike Plaintiffs Expert John Shaw Pursuant to F.R.E. 702 (ECF No. 100); Defendants' Motion in Limine to Exclude or Redact Nicholas Fazio's 12.12.18 Inspector's Daily Report and Mohammed Rahman's 10.15.18 Email (ECF No. 101); and CSX's Motion to Permit an Adverse Inference from the Fifth Amendment Invocations of Miguel Mendez (ECF No. 102). The Motions are fully briefed and no hearing is required. See Local Rule 105.6 (D. Md. 2023).

This is a case riddled with factual disputes about the appropriateness of the conduct that occurred in the immediate aftermath of and emergent circumstances of a spill of toxic materials. Not surprisingly, the Court's ultimate finding is that these issues should be decided by a jury. Accordingly, the pending dispositive Motions will be denied. The Court will discuss the resolution of each Motion in detail below.

I. Background

A. Curtis Bay Terminal and the Water Filtration System

CSX is an interstate rail carrier that provides rail transportation services and operates the Curtis Bay terminal at the center of this lawsuit, a rail facility that receives and stores coal before it is loaded onto barges or ships. (Pankey Dec. ¶ 7, ECF No. 120-2; Zacker Dep. at 44:8-11, ECF No. 105-4.)^[3] "Given the Facility stores large piles of coal, it maintains a dust suppression system that uses high-powered sprayers to wet the coal piles down to prevent coal dust migration and to comply with a Maryland Department of Environment ('MDE') Air Permit." (Pankey Dec. ¶ 8, ECF No. 120-2.)

This dust suppression system is a "closed-loop water filtration and distribution" system that collects recycled dust suppression water and water from precipitation events, treats that water, and either cycles it back to the sprayers for dust suppression or discharges it into Curtis Bay.^[4](Shaw Dep. at 9:19-24; Zacker Dep. at 44:14-45:5, 75:7, ECF No. 105-4.)

The coal piles at the Facility are all surrounded by drainage ditches to collect rain water or recycled coal rinse water. (Zacker Dep. at 55:3-4, 58:18-20 ECF No. 105-4.) Thus, "[a]ny water the system collects will be continually reused." (Pankey Dec. ¶ 13, ECF No. 120-2.) Generally speaking, after water enters the system through a drainage ditch, it first goes into the main basin to allow solids to settle and then is pumped into three secondary settlement/storage tanks, each of which have a maximum capacity of 1.7-2.2 million gallons. (Zacker Dep. at 73:10-74:16, ECF No.. 105-4; Operations.& Maintenance Manual, Curtis Bay Piers Facility Storm Water Treatment System ("Operations & Maintenance Manual"), ECF No. 103-9 at 3-4; MDE Investigation Rep,, ECF No. 105t27 at 2.) From there, the water goes through a sand filter either to a storage tank from which it would be sprayed onto coal piles for dust suppression, or-if there is too much water in the system-to the ion exchange and into Curtis Bay. (Zacker Dep. at 74:17-75:5, ECF No. 105-4; MDE Investigation Rep., ECF No. 105-27 at 2.)

The system is designed to remove metals, not bacteria. (Zacker Dep. at 45:7-10, ECF No. 105-4.) The water filtration system was relatively new at the time of the events at issue, having been completed in 2016 or 2017. (Pankey Dep. at 79:6-9, ECF No. 105-6.) CSX hired Bruno Reyntjens, of PCMA Systems, "to manage the wastewater treatment system." (Id. at 75:20-21.)

CSX's MDE National Pollution Discharge Elimination System ("NPDES") Permit set parameters for any water discharged into Curtis Bay. (Pankey Dec. ¶19, ECF No. 120-2; Summers Dep. at 77:16-19, ECF No. 120-11.) Under the NDPES Permit, CSX was required to monitor several indicators in the water, including total residual chlorine. (Pankey Dec. 122, ECF No. 120-2.) Until about October.3, 2018, CSX used chlorine to disinfect the water in the filtration system and control biological growth. (Shaw Dep. at 10:15-23, 11:5-8, ECF No. 103-14.) CSX's Operations & Maintenance Manual for the water filtration system describes this step as "essential to proper operation of the storm water treatment" and states that "[t]here are no workable alternate operating modes for this facility." (Operations & Maintenance Manual, ECF No. 103-9 at 6.) To comply with its Permit requirements, CSX then dechlorinated the water prior to discharging it into Curtis Bay. (Pankey Dec. ¶ 20, ECF No. 120-2; Shaw Dep. at 11:10-18, ECF No. 103-14; Operations & Maintenance Manual, ECF No. 103-9 at 10.)

However, "[w]hen using potable water from the City, CSX would have difficulty dechlorinating the water in the water filtration system to an acceptable level under the NPDES Permit." (Pankey Dec. ¶ 20, ECF No. 120-2.) In September 2018 "[t]he total residual chlorine detected was in excess of the amount permitted under the NDPES Permit" and CSX therefore stopped chlorinating the water in the system on about October 3, 2018 "to ensure any water that was discharged complied with the parameters set forth in the NPDES Permit." (Id. ¶¶ 26, 27; see also Summers Dep. at 78:1-2, ECF No. 120-11 ("there were high levels of total residual chlorine in the effluent at time prior to 2018"); Cassino Dep. at 100:4-21, ECF No. 120-10 (acknowledging that the water in the filtration system was chlorinated during the approximately one-year time period leading up to October 12,2018 based on reports he reviewed, sometimes with an excessive amount of chlorine).) One of CSX's proffered experts, John Shaw, noted that he "might have gone a different route" to ensure compliance with the Permit, such as dechlorinating the water or managing the discharge differently. (Shaw Dep. at 12:4-13, ECF No. 120-8.)

B. Right of Entry Agreement and Spiniello 's Work

CSX and the City entered into a Right of Entry Agreement to allow the City access to CSX's property to rehabilitate manholes and sewer lines running under the property. (See generally Right of Entry Agreement, ECF No. 105-2.) The City hired Spiniello as a contractor to clean out and reline sewer pipes. (Cornish Dep. at 25:15-26:2, ECF No. 105-3; Fazio Dep. at 43:21-44:9, ECF No. 105-10.) Spiniello started work at the Facility sometime around September 2018. (MDE Investigation Rep., ECF No. 105-27 at 2 ("Spiniello has been working in the vicinity of the property for approximately 2 months and on site within the last few weeks [as of October 18, 2018]."); Sept. 12, 2018 Inspector's Daily Rep., ECF No. 105-12 (referencing work activity by Spiniello); Timeline, ECF 105-25 at 3 (timeline of events prepared by City Inspector Nicholas Fazio noting that "Spiniello started working at the location on October 3, 2018").)

Spiniello's work entailed removing debris and blockages from the sewage line using a vacuum truck, also referred to as a "vac truck." (Cornish Dep. at 58:15-59:4, ECF No. 105-3; Mendez Dep. at 15:1-9, ECF No. 105-14; Shaw Rep., ECF No. 100-1 at 5.) To do this, workers sprayed high pressure water into the sewer line using a jetter nozzle to break material off the sewer walls, and sometimes workers would enter the manhole to physically scrape debris off the wall. (Fazio Dep. at 55:1-7, ECF No. 105-10; Cornish Dep. at 59:1-8, ECF No. 105-3.) The solids released during this process became mixed into the water, creating a "suspension of solids in water." (Summers Dep. at 15:16-16:9, ECF No. 105-15.)

The wastewater and waste debris from the sewer line were then vacuumed back into the tank of the vac truck using a hose. (Fazio Dep. at 57:3-9, ECF No. 105-10; Cornish Dep. at 59:9-15, ECF No. 105-3.) The liquids...