Liebhart v. SPX Corp.

WILLIAM LIEBHART and NANCY LIEBHART, Plaintiffs, v. SPX CORPORATION, TRC COMPANIES, INC.,and APOLLO DISMANTLING SERVICES, INC., Defendants.

16-cv-700-jdp

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WISCONSIN

November 2, 2017

OPINION & ORDER

This case arises out of the demolition of an old industrial facility in Watertown, Wisconsin. Plaintiffs William Liebhart and Nancy Liebhart, who lived on property adjacent to the facility, allege that the demolition contaminated the surrounding area with polychlorinated biphenyls, or PCBs, causing the Liebharts to suffer from a variety of health problems, including acute sinusitis, bronchitis, conjunctivitis, vertigo, skin infections, and swollen lymph nodes. The Liebharts are suing SPX Corporation (the owner of the site), TRC Companies, Inc. (the firm that oversaw the demolition), and Apollo Dismantling Services, LLC (the company that conducted the demolition) under various federal and state law theories.

Defendant SPX has filed a motion to dismiss many of the Liebharts' claims on the following grounds: (1) the Resource Conservation and Recovery Act (RCRA) does not regulate the disposal of PCB waste; (2) the Liebharts do not state a claim under the Toxic Substances Control Act (TSCA) because they are not alleging that the demolition is ongoing; (3) SPX cannot be held strictly liable because the demolition does not meet the requirements for an "abnormally dangerous activity" under Wisconsin law; and (4) the Liebharts' allegations do not meet the requirements for bringing a claim for negligent infliction of emotional distress. Dkt. 35.

Defendant TRC has adopted SPX's motion as its own and has filed its own motion to dismiss the Liebharts' claim for strict liability. Dkt. 31. None of the defendants seek dismissal of the Liebharts' claims for negligence, nuisance, or trespass.¹ For their part, the Liebharts have filed a motion for leave to amend their complaint to include a request for civil penalties under the RCRA. Dkt. 49.

For the reasons explained below, the court will deny all of these motions.

ALLEGATIONS OF FACT

The Liebharts allege the following facts in their complaint. Dkt. 2.

Plaintiffs William and Nancy Liebhart own three properties adjacent to a former industrial facility in Watertown, Wisconsin. They lived in one of these properties until August 2016.

The facility was originally a woodworking factory. In the 1950s it was used to manufacture electrical transformers, which commonly included PCBs at the time. Both the International Agency for Research on Cancer and the Environmental Protection Agency have concluded that exposure to PCBs may have harmful effects on humans, including certain kinds of cancer, respiratory tract symptoms, gastrointestinal effects, mild liver effects, and effects on the skin and eyes such as chloracne, skin rashes, and eye irritation.

In 1998, defendant SPX became the owner of the facility, but by then the facility was not operational and SPX allowed it to lay idle. In 2010, laboratory analyses showed thatapproximately 20,650 square feet of concrete contained PCBs at concentrations greater than 10 parts per million and as much as 3,310 parts per million. (The Liebharts say that the "residential standard" for PCBs is .22 ppm.)

In December 2014, SPX submitted a plan to the EPA for a proposed demolition of the facility. Under defendant TRC's supervision, defendant Apollo would remove the contaminated concrete and demolish the facility. In February 2015, the EPA approved the plan, subject to three conditions: 1) within 60 days of completion of the project, SPX would submit a completion report, including verification sampling results and other data; 2) within 60 days of completion of the project, SPX would file a deed restriction prohibiting the use of the property for residential purposes; and 3) SPX would give the EPA 45 days advance notice before transferring ownership of or responsibility for the site.

Shortly after the demolition began, the Liebharts observed plumes of dust coming from the demolition site as well as discolored snow on their properties. William Liebhart was diagnosed with impetigo, acute sinusitis, and lymphadenopathy. Nancy Liebhart was diagnosed with conjunctivitis and bronchitis, and vertigo. The family physician attributed these aliments to the exposure to the demolition dust.

The Liebharts collected a sample of the discolored snow for laboratory analysis, which also showed the presence of PCBs.

The demolition continued and the Liebharts continued seeing plumes of dust drifting onto their property. Oil leaking from a transformer drained into the Liebharts' soil. A laboratory analysis showed that the soil contained over 200 ppm of PCBs.

The Watertown Health Department confirmed "the existence of uncontrolled PCB-contaminated concrete" on the site, id., ¶ 40, and notified the Wisconsin Department ofResources, which notified defendant TRC. In April 2015, TRC collected soil samples from the Liebharts' properties. The test results showed that soil from the Liebharts' garden was about 5.5 ppm of PCBs, 25 times higher than the residential standard. Much of the food that the Liebharts consumed had come from that garden. Defendants obtained more soil samples in May 2015, November 2015, and January 2016, all of which showed PCBs in the soil.

In August 2016, William Liebhart suffered from a rash on his face, which his physician diagnosed as chloracne, a condition associated with exposure to PCBs. The Liebharts decided to move out of their home, as recommended by their physician.

ANALYSIS

A. Resource Conservation and Recovery Act

The Liebharts wish to bring a claim under 42 U.S.C. § 6972(a)(1)(B), which creates a private right of action against anyone "who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment." SPX seeks dismissal of the claim on the ground that PCBs are not a "hazardous waste" within the meaning of the RCRA.

SPX does not contend that PCBs do not meet the requirements for a "hazardous waste" under the statutory definition of the term in 42 U.S.C. § 6903(5) or that the RCRA explicitly excludes PCBs from the scope of § 6972(a)(1)(B). Rather, SPX takes a more circuitous route to reach its proposed interpretation.

The cornerstone of SPX's argument is 42 U.S.C. § 6905(b), which directs the EPA to "integrate all provisions of [the RCRA] for purposes of administration and enforcement and . . .avoid duplication, to the maximum extent practicable, with the appropriate provisions of . . . such other Acts of Congress as grant regulatory authority to the" EPA. Because PCBs are already regulated expressly under the Toxic Substances Control Act and related regulations, SPX says that including PCBs within the scope of the RCRA would violate § 6905(b).

SPX also cites 42 U.S.C. § 6921(b)(1), which delegates to the EPA authority to "promulgate regulations identifying the characteristics of hazardous waste, and listing particular hazardous wastes . . . which shall be subject to the provisions of this subchapter." 42 U.S.C. § 6921(b)(1). Because the EPA has not identified PCBs as a hazardous waste subject to regulation under the RCRA, SPX says that Chevron, USA, Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984), requires a conclusion that the meaning of "hazardous waste" in the RCRA does not include PCBs.

The Liebharts agree with SPX that PCBs do not qualify as a "hazardous waste" under the RCRA regulations. But they reject the conclusion that they fail to state a claim under the RCRA on two grounds: (1) the statutory definition of "hazardous waste" in the RCRA is broader than the definition in the EPA regulations; and (2) even if the PCBs in this case are not a "hazardous waste" under the RCRA, they are a "solid waste," which is also covered by the RCRA. New York Communities for Change v. New York City Dep't of Educ., No. 11 CV 3494 SJ, 2012 WL 7807955, at *1 (E.D.N.Y. Aug. 29, 2012) (agreeing with both grounds), report and recommendation adopted, No. 11CV3494 SJ CLP, 2013 WL 1232244 (E.D.N.Y. Mar. 26, 2013).

The court need not decide whether the RCRA statute and regulations define "hazardous waste" differently because the court agrees with the Liebharts that PCBs may qualify as a "solid waste" under § 6972(a)(1)(B). SPX simply ignores the question whether PCBs may qualify as a "solid waste," even in its reply brief, which is reason enough to deny the motion to dismissas to this claim. But even if the court assumes that SPX has not forfeited the issue for the purpose of its motion to dismiss, the court sees no obvious grounds for rejecting the Liebharts' contention that PCBs may qualify as a solid waste.

The RCRA defines "solid waste" to mean

any garbage, refuse, sludge from a waste treatment plant, water supply treatment plant, or air pollution control facility and other discarded material, including solid, liquid, semisolid, or contained gaseous material resulting from industrial, commercial, mining, and agricultural operations, and from community activities, but does not include solid or dissolved material in domestic sewage, or solid or dissolved materials in irrigation return flows or industrial discharges which are point sources subject to permits under section 1342 of Title 33, or source, special nuclear, or byproduct material as defined by the Atomic Energy Act of 1954, as amended (68 Stat. 923) [42 U.S.C.A. § 2011 et seq.].

42 U.S.C. § 6903(27). The Liebharts allege in their complaint that the PCBs at issue in this case meet that definition. Dkt. 2, ¶ 75.

At this stage of the proceedings, the court is not persuaded that § 6905(b) requires PCBs to be excluded from the statutory definition of "solid waste." SPX interprets § 6905(b) as mandating a conclusion that there can be no overlap in the substances covered by the...