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United States v. ExxonMobil Pipeline Co.

United States District Court, E.D. Arkansas, Western Division

June 9, 2014

UNITED STATES OF AMERICA and STATE OF ARKANSAS, PLAINTIFFS
v.
EXXONMOBIL PIPELINE COMPANY and MOBIL PIPE LINE COMPANY, DEFENDANTS

Page 844

For USA, Plaintiff: Christopher Robert Thyer, LEAD ATTORNEY, U.S. Attorney's Office, Eastern District of Arkansas, Little Rock, AR; Edwin Quinones, LEAD ATTORNEY, U.S. Environmental Protection Agency, EPA Region 6, Dallas, TX; Emily C. Powers, Jason T. Barbeau, Robyn E. Hanson, LEAD ATTORNEYS, U.S. Department of Justice - Environmental Enforcement, Environmental and Natural Resources Division, Washington, DC; Richard M. Pence, Jr., LEAD ATTORNEY, U.S. Attorney's Office, Eastern District of Arkansas, Little Rock, AR; Robert G. Dreher, LEAD ATTORNEY, U.S. Department of Justice - Environmental Enforcement, Washington, DC.

For Arkansas, State of, Plaintiff: Dustin Blake McDaniel, Kendra Akin Jones, LEAD ATTORNEYS, Eric Barkley Estes, Jamie L. Ewing, Patrick E. Hollingsworth, Arkansas Attorney General's Office, Little Rock, AR.

For Exxonmobil Pipeline Company, Mobil Pipe Line Company, Defendants: Roger R. Martella, Jr., Timothy K. Webster, LEAD ATTORNEYS, PRO HAC VICE, Sidley Austin LLP, Washington, DC; Justin T. Allen, N.M. Norton, Jr., Stephen R. Lancaster, Wright, Lindsey & Jennings, Little Rock, AR.

Page 845

ORDER

Kristine G. Baker, United States District Judge.

Before the Court is defendants Exxonmobil Pipeline Company's and Mobil Pipe Line Company's motion to dismiss (Dkt. No. 5). The United States of America and the State of Arkansas have responded in opposition (Dkt. Nos. 17, 19), and defendants have replied (Dkt. No. 21). Defendants seek to dismiss the complaint against them pursuant to Rules 8(a) and 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim upon which relief can be granted.

I. Factual Background

The United States and the State of Arkansas assert claims against defendants arising out of the March 29, 2013, oil spill from the Pegasus Pipeline rupture in Mayflower, Arkansas. The Pegasus Pipeline is

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owned by separate defendant Mobil Pipe Line Company and operated by separate defendant Exxonmobil Pipeline Company. The United States and the State of Arkansas claim the oil spill caused an evacuation of approximately 22 homes resulting from the hazardous conditions of the spill and that the oil flowed through that residential neighborhood into nearby waterways, including an unnamed creek, wetlands, and Lake Conway, a 6,700-acre lake that flows to the Arkansas River. The United States and the State claim that, as of the filing of the complaint, oil from that spill has contaminated land and waterways and impacted human health and welfare, wildlife, and habitat and claim that cleanup efforts remain ongoing.

The United States and the State of Arkansas assert the spilled oil caused, inter alia, a film or sheen upon or discoloration of the surface of the water and adjoining shorelines and caused deposition beneath the surface of the water or upon adjoining shorelines. The United States and State of Arkansas allege that, as of the filing of the complaint, petroleum was still present in portions of the impacted area and continued to impact negatively existing instream water uses; did not meet the level of water quality necessary to protect the existing uses; increased the true color of the waters of the state; resulted in offensive odors arising from the waters of the state and interfered with the reasonable use of water; introduced toxic substances into waters of the state at levels above acceptable human health and aquatic life criteria; produced globules, residue, film, and/or sheen on the surface or banks; has caused a visible increase in the turbidity of waters of the state; impacted the pH of waters of the state and caused it to fluctuate in excess of 1.0 unit over a 24-hour period; and caused dissolved oxygen levels in the waters of the State to decrease below the set standards that must be met to protect aquatic life.

The United States and the State also allege that the air pollution caused by the release of petroleum has unreasonably interfered with the Mayflower residents' enjoyment of life and use of their property and the surrounding area, including causing the evacuation of homes in the residential neighborhood.

Finally, the United States and the State of Arkansas allege defendants have stored petroleum-contaminated waste at 322 Highway 26, Conway, Arkansas (" Highway 36 site" ) and that the waste of this site contains soils, oily debris, wood chips, hydrovac mud, concrete and asphalt, and oil/water mixture waste. The United States and the State complain that the Arkansas Department of Environmental Quality (" ADEQ" ) notified defendants on May 1, 2013, that the Highway 36 site waste removal was to be completed within seven days, that defendants failed to remove the waste by May 8, 2013, and that, as of the time of the complaint, waste was still present on the site.

As the first cause of action in the complaint, plaintiffs seek civil penalties for alleged violations of Section 311(b) of the Clean Water Act (" CWA" ), 33 U.S.C. § 1321(b). Section 311(b)(3), of the CWA prohibits the " discharge of oil or any hazardous substances into or upon the navigable waters of the United States, adjoining shorelines, or into or upon the waters of the contiguous zone . . . in such quantities as may be harmful as determined by [federal regulation]." 33 U.S.C. § 1321(b)(3). Section 311(b)(7)(A) of the CWA, 33 U.S.C. § 1321(b)(7)(A), subjects " [a]ny person who is the owner, operator, or person in charge of any . . . onshore facility . . . from which oil . . . is discharged in violation of paragraph (3) . . . to a civil penalty . . . ." That civil penalty increases pursuant to

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Section 311(b)(7)(D) of the CWA, 33 U.S.C. § 1321(b)(7)(D), if the violation is the result of " gross negligence or willful misconduct."

As the second cause of action in the complaint, plaintiffs seek injunctive relief pursuant to section 309(b) of the CWA, 33 U.S.C. § 1319(b). Section 301(a) of the CWA, 33 U.S.C. § 1311(a), makes unlawful " the discharge of any pollutant by any person." Section 309(b) of the CWA, 33 U.S.C. § 1319(b), the enforcement provision for section 301, authorizes civil actions for " appropriate relief, including a permanent or temporary injunction."

As the third cause of action in the complaint, plaintiffs allege violations of the Arkansas Hazardous Waste Management Act of 1979 (" HWMA" ), Ark. Code Ann. § 8-7-201, et seq. The HWMA and Arkansas Pollution Control and Ecology Commission (" APC& EC" ) Regulation 23 set forth the state regulatory program governing the generation, storage, transportation, treatment, and disposal of hazardous wastes. Ark. Code Ann. § 8-7-205(4) provides that it is unlawful for any person to:

Store, collect, transport, treat, or dispose of any hazardous waste contrary to the rules, regulations, permits, or orders issued under this subchapter or in such a manner or place as to create or as is likely to be created a public nuisance or a public health hazard or to cause or is likely to cause water or air pollution within the meaning of the Arkansas Water and Air Pollution Control Act, § 8-4-101 et seq.

Alleging that the term " hazardous waste" includes petroleum-contaminated wastes, plaintiffs allege that defendants are persons who have stored, transported, and disposed of hazardous waste contrary to the rules, regulations, permits, or orders issued under the HWMA or in such a manner or place as to create or as is likely to be created a public nuisance or a public health hazard within the meaning of the Arkansas Water and Air Pollution Control Act. Ark. Code Ann. § 8-7-204(b)(4) provides for civil penalties for violations of the HWMA and of any rules, regulations, permits, or plans issued pursuant to the HWMA.

As the fourth cause of action, plaintiffs allege violations of the Arkansas Water and Air Pollution Control Act, Ark. Code Ann. § 8-4-101, et seq., with respect to the protection of water quality. The Arkansas Water and Air Pollution Control Act and APC& EC Regulation 2 set forth the state regulatory program governing the protection of water quality. Ark. Code Ann. ยง 8-4-217(a)(1) makes it unlawful to cause pollution of any of the ...


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