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Federal Court Rules that Compliance with Clean Air Act Permit Does Not Preempt Private Tort Suits Over Air Emissions

September 12, 2013

Background
The U.S. Court of Appeals for the Third Circuit recently held that a facility's compliance with a valid Clean Air Act permit does not preempt private lawsuits alleging damages from air emissions brought under the law of the state in which the facility is located. In Bell v. Cheswick Generating Station,1 a class of plaintiffs living near a coal-fired power plant in Pennsylvania brought claims for nuisance, negligence, and trespass under Pennsylvania law, alleging that the power plant released harmful air emissions into the surrounding neighborhood and damaged the plaintiffs' properties. The power plant argued that it was in full compliance with its Clean Air Act (CAA) operating permit, and that the state law tort claims were preempted by the federal CAA. The District Court agreed and dismissed the suit, holding that "the Clean Air Act represents a comprehensive statutory and regulatory scheme that establishes the standards with which the Cheswick Generating Station must abide," and that "Plaintiff's Complaint, as pled, would necessarily require this Court to engraft or alter those standards, and judicial interference in this regulatory realm is neither warranted nor permitted." The Third Circuit reversed, comparing the plaintiffs' claims to claims brought under the federal Clean Water Act (CWA), and, based on previous CWA cases and an analysis of the "savings clauses" in the CAA, concluding that the CAA does not preempt common-law tort claims that are based on the law of the source state (i.e., the state in which the facility is located).

Lessons from the Case
The holding is (so far) limited to the Third Circuit. The Third Circuit's decision in Bell is arguably in tension with a 2010 decision from the Fourth Circuit, North Carolina v. Tennessee Valley Authority,2 which held that public nuisance claims from neighboring states were preempted by the CAA. Though it did not directly address private tort claims based on the source state's common law, the Fourth Circuit suggested that subjecting permittees to a state-by-state patchwork of ambiguous nuisance laws is incompatible with the comprehensive regulatory framework established by the CAA. Other federal appeals courts (including the Seventh Circuit, which covers Wisconsin, Illinois, and Indiana) have yet to address whether the CAA preempts private state-law tort suits. The U.S. Supreme Court has so far declined to rule on the issue. Thus, though the Third Circuit's decision is concerning, permittees under the CAA should not give up hope that a federal preemption defense remains available against tort claims alleging damages from air emissions. The issue is far from settled nationwide, and the Third Circuit's opinion is subject to discretionary appeal to the U.S. Supreme Court.

Other preemption-related defenses may be available. In addition to federal preemption, permittees may be able to argue that state statutes regulating air emissions preempt common law tort claims such as nuisance. State preemption issues would likely need to be addressed on a state-by-state basis. Furthermore, defendants may be able to raise fact-specific administrative law arguments, such as the plaintiffs' failure to exhaust available administrative review remedies for seeking more stringent emission limitations in the underlying permit.

Public relations efforts are critical. Regardless of how the issue of federal preemption is settled in other jurisdictions, permit holders should consider strategies for reaching out to members of the public who may be impacted by potential emissions (and may thus be in a position to bring future tort claims) in order to ensure that the public has thorough and accurate information. The Third Circuit's decision in Bell, which allowed tort claims to proceed, highlights the importance of such public relations efforts.

1 No. 12-4216 (3d Cir. August 20, 2013).
2 615 F.3d 291 (4th Cir. 2010).

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