Raritan Baykeeper, Inc. v. NL Indus., Inc.

RARITAN BAYKEEPER, INC., et al., Plaintiffs,

v.NL INDUSTRIES, INC., et al., Defendants.

Civil Action No. 09-cv-4117 (JAP)

UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

Dated: January 8, 2013

NOT FOR PUBLICATION

OPINION

PISANO, District Judge

This is an environmental remediation action brought pursuant to the citizen suit provisions of the Resource Conservation and Recovery Act ("RCRA") and the Clean Water Act ("CWA") involving a parcel of land (the "Site") located on the Raritan River. Plaintiffs seek the remediation of contaminated sediments in the Raritan River and the remediation of on-site sources of contamination that discharge into the river. Defendants are past and current owners or lessees of the Site and highway authorities that own highways which cross the land.

Presently before the Court are the following motions: Defendants Michael Davis and James S. Simpson¹ from the New Jersey Department of Transportation's Central Region (collectively "NJDOT Defendants")'s Motion to Dismiss pursuant to Rules 12(b)(1) and 12(b)(6) [docket # 183]; Defendants New Jersey Turnpike Authority and Veronique Hakim² (collectively "NJTA")'s Motion to Dismiss pursuant to 12(b)(6) [docket # 184]; Defendant Sayreville SeaportAssociates, L.P. ("SSA")'s Motion to Dismiss the Amended Complaint, or in the alternative, for a Stay [docket # 185]; Defendant Sayreville Economic and Redevelopment Agency ("SERA")'s Motion to Dismiss the Amended Complaint, or in the alternative, for a Stay [docket # 186]; Defendant Middlesex County's Motion to Dismiss [docket # 187]; Defendants NL Industries, Inc. and NL Management Services, Inc. (collectively "NL")'s Motion for Summary Judgment or, in the alternative, for a Stay [docket # 188]; and Defendant NL's Motion to Dismiss the Amended Complaint [docket # 189]. Having reviewed the briefs associated with the motions above, this Court finds that NL has not met its burden under the summary judgment standard and Plaintiffs have alleged sufficient facts to establish a plausible claim for relief under Federal Rule of Civil Procedure 12(b)(6); therefore, the Court denies the motions. The Court reserves decision on the Motions for a Stay; it Ordered the parties to submit proposals regarding the parameters of a Stay within fourteen days of the date of the accompanying Order. A decision on the Motion for a Stay will be rendered after this Court has reviewed the parties' proposals.

I. BACKGROUND³

The Site, at issue here, consists of approximately 440 acres of land located at 1000 Chevalier Avenue, Sayreville, Middlesex County, New Jersey. It is surrounded on three sides by the Raritan River, which is the largest river located entirely within New Jersey. The Garden State Parkway, Route 9, and Route 35 cross the Site.

NL owned the Site from the early 1930's to 2005, and from approximately 1935 to 1982, it manufactured titanium dioxide pigments on the Site that were used in paints, paper, cosmetics, and other items. In 1982, NL ceased operations at the Site. It leased a portion of the Site, called the Marsulex Tract, and sold two sulfuric acid plants on that tract to C-I-L Corporation of America ("C-I-L"). In 1989, Marsulex took assignment of C-I-L's lease and purchased the two sulfuric acid plants. Both C-I-L and Marsulex manufactured sulfuric acid on the Site. In 1997, NL and Marsulex agreed that NL would assume responsibility for any environmental issues associated with the leased land.

In 1988, the New Jersey Department of Environmental Protection ("NJDEP") required NL to conduct an environmental investigation of the Site in compliance with New Jersey's Environmental Cleanup Responsibility Act, which is now known as the Industrial Site Recovery Act. As a result, in June 2000 and July and August 2002, NL collected samples of river sediments taken from locations downstream, adjacent to, upstream, and across the river from the Site. In October 2000, April 2001, November 2002, and July 2003, NL submitted reports containing the results of the sediment sampling to the NJDEP. The results revealed that river sediments adjacent to and downstream from the Site were contaminated with arsenic, copper, lead, nickel, and zinc. Previously, the NJDEP adopted the Marine/Estuarine Screening Guidelines, which are screening levels for sediment contamination. Under these Guidelines, the Effects Range-Low ("ER-L") value is the concentration at which adverse benthic impacts are found in approximately 10% of studies, and the Effects Range-Medium ("ER-M") value is the concentration at which adverse benthic impacts exist in more than 50% of studies. Applying these Guidelines to the results, nearly all of the samples taken from adjacent to the Site exceeded the ER-L standard and many exceeded the ER-M standard as well. Additionally, the samplestaken from downstream of the Site exceeded the ER-L standard for arsenic, copper, lead, and nickel. After reviewing these results, NL concluded that the sediment contamination was due, at least in part, to the North Ditch, which is a drainage ditch on the Site that discharges surface water runoff into the river, the Garden State Parkway, Route 35, and other overland sources instead of from groundwater. Moreover, NL determined that the Tertiary Lagoon System, which is used "for containment and settling of plant process effluent prior to discharge into the" river, is not a "significant source of sediment contamination" (Second Amended Complaint ¶ 68).

On June 24, 2004, the NJDEP sent NL a letter containing its comments on the results of the river sediment studies. The NJDEP acknowledged NL's conclusions that "[c]oncentrations of [arsenic, copper, lead, nickel, and zinc] are present at levels above their respective NJDEP Sediment Screening Criteria" and "[t]he spatial distribution of the metals suggests inputs to the river from overland flow from off-site locations," such as the Garden State Parkway, and "on-site locations," like the North Ditch. See Letter from NJDEP to NL, Ex. 21 attached to Declaration of Patrick M. Flynn in Support of NL's Motion for Summary Judgment [docket # 188]. The NJDEP concluded, however, that "[w]hile N.L. Industries has contributed to the sediment contamination detected adjacent to the site," it would not require remediation of the river sediments at that time. Id. Instead, the NJDEP declared that "any remedial actions conducted in this area of the river should be part of a regional approach" because "any remedial efforts targeted adjacent to the . . . [Site] would be shortlived and of little ecological significance as recontamination" from upstream sources "would occur within a relatively short period of time." Id. Since this letter, no regional approach or remediation of river sediments has occurred.⁴

In 2005, SERA acquired the Site through eminent domain for the purpose of redevelopment. In 2007, SERA chose O'Neill Properties Group, L.P. to redevelop the Site, and O'Neill created SSA for that purpose. On June 28, 2008, NL, SERA, SSA, and Middlesex County entered into the 2008 Agreement ("Agreement"), which transferred ownership of the Site from NL to SERA through three closings. This Agreement also divided the Site into Parcels A, B, and C. At the first closing, in September 2008, SSA assumed a 99 year ground lease for Parcel C, and Middlesex County purchased an easement across Parcel C along the waterfront and across Parcel B along the waterfront. ¶ 56. At the second closing, in June 2009, Middlesex County purchased Parcel A, which it will hold as Open Space, subject to conservation easements. The third closing took place in May 2012.

Moreover, the Agreement discussed the parties' environmental responsibilities at the Site. SSA assumed responsibility for all environmental investigation and remedial obligations at the first closing. There were certain exceptions, however, to SSA's assumption of responsibility, including that NL would be responsible for the remediation and investigation of the river sediments. SSA retained responsibility for on-site remediation, such as excavation, capping, and treatment of groundwater through an injection program. The Agreement did not discuss a specific plan for remediating the river sediments. Furthermore, the Agreement provided that in the event SSA defaulted on its environmental responsibilities, SERA would select a contractor to complete the remaining responsibilities. If SERA defaulted on its obligations, the parties agreed that NL would be designated as lead remediator.

Shortly after the parties' entered into the Agreement, SERA entered into a Memorandum of Understanding ("MOU") with the NJDEP, effective September 25, 2008. In the MOU, SERA agreed to submit Remedial Action Work Plans ("RAWPs") to the NJDEP and to implement them once approved. In addition, SERA agreed to annually submit to the NJDEP a detailed review of all remediation costs it expended to comply with the MOU.

On August 11, 2009, Plaintiffs filed their initial Complaint [docket # 1]. On September 29, 2009, Defendants NJDOT, Stephen Dilts, and Bernard James⁵ filed a Motion to Dismiss for Lack of Jurisdiction [docket # 11], and on October 8, 2009, the NJTA filed a Motion to Dismiss pursuant to Rules 12(b)(1) and 12(b)(6) [docket # 23]. Plaintiffs filed their Amended Complaint shortly thereafter, on October 13, 2009 [docket # 24]. On October 16, 2009, the Court ordered that the NJDOT be voluntarily dismissed from the action pursuant to Rule 41(a)(1)(A), but Dilts and James remained as defendants [docket # 32]. Subsequently, on December 15, 2009, Defendants O'Neill Properties Group and SSA, NL, and SERA filed Motions to Dismiss pursuant to 12(b)(6), and Middlesex County and the NJDEP filed answers to the Amended Complaint [docket # 56-60]. On January 8, 2010, Middlesex County filed a Cross-Motion to Dismiss the Complaint [docket # 64]. On February 22, 2010, the Court granted the voluntary dismissal of O'Neill Properties Group [docket # 86].

On May...