Filed: Jun. 03, 2020
Latest Update: Jun. 03, 2020
Summary: FILED NOT FOR PUBLICATION JUN 3 2020 UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT MISSION LINEN SUPPLY, a California No. 19-15392 corporation, D.C. No. Plaintiff-Appellee, 1:15-cv-00672-AWI-EPG v. MEMORANDUM* CITY OF VISALIA, Defendant-Appellant. Appeal from the United States District Court for the Eastern District of California Anthony W. Ishii, District Judge, Presiding Submitted March 27, 2020** San Francisco, California Before: WALLACE, GRA
Summary: FILED NOT FOR PUBLICATION JUN 3 2020 UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT MISSION LINEN SUPPLY, a California No. 19-15392 corporation, D.C. No. Plaintiff-Appellee, 1:15-cv-00672-AWI-EPG v. MEMORANDUM* CITY OF VISALIA, Defendant-Appellant. Appeal from the United States District Court for the Eastern District of California Anthony W. Ishii, District Judge, Presiding Submitted March 27, 2020** San Francisco, California Before: WALLACE, GRAB..
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FILED
NOT FOR PUBLICATION
JUN 3 2020
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MISSION LINEN SUPPLY, a California No. 19-15392
corporation,
D.C. No.
Plaintiff-Appellee, 1:15-cv-00672-AWI-EPG
v.
MEMORANDUM*
CITY OF VISALIA,
Defendant-Appellant.
Appeal from the United States District Court
for the Eastern District of California
Anthony W. Ishii, District Judge, Presiding
Submitted March 27, 2020**
San Francisco, California
Before: WALLACE, GRABER, and COLLINS, Circuit Judges.
The City of Visalia timely appeals from the district court’s equal allocation
of future recovery costs between the City and Mission Linen Supply ("Mission"),
in this action under the Comprehensive Environmental Response, Compensation,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
and Liability Act of 1980, 42 U.S.C. §§ 9601–75. Reviewing for abuse of
discretion the district court’s selection of factors and for clear error in its allocation
of costs according to those factors, Boeing Co. v. Cascade Corp., 207 F.3d 1177,
1187 (9th Cir. 2000), we affirm.
The district court did not abuse its "broad discretion." TDY Holdings, LLC
v. United States, 885 F.3d 1142, 1149 (9th Cir. 2018). The court permissibly
focused on the factor of geographic distribution and attributed most responsibility
for on-site pollution to Mission and most responsibility for off-site pollution to the
City. See
Boeing, 207 F.3d at 1187 (holding that district courts have discretion "to
decide what factors ought to be considered"). On appeal, the City does not
challenge the court’s many factual findings concerning the City’s sewers. They
were "installed below general industry standards." The slope of some sewers was
too flat, allowing wastewater to seep into the ground. Some sewers were too
shallow. Other problems included "holes/broken pipes, exposed soil, cracks, sags,
offset/separated joints, missing portions of pipe, root intrusion, debris, and deposits
of material that indicate blockages and surcharge conditions." The City did not
restrict or limit the dumping of PCE into the sewers. But for the defects in the
sewers, the wastewater would have reached the City’s treatment facilities.
2
The cases cited by the City do not support its view that the court here abused
its discretion. As an initial matter, even if one of the cases were factually similar,
the existence of discretion means that one district court could reach a conclusion
different from the conclusion of another district court. In any event, none of the
cited cases involved factually similar circumstances. See Boeing, 207 F.3d at
1180–82 (affirming allocation of 30% of costs to one landowner and 70% of costs
to another landowner because of differing levels of pollution); Waste Mgmt. of
Alameda Cty., Inc. v. E. Bay Reg’l Park Dist.,
135 F. Supp. 2d 1071, 1089–1104
(N.D. Cal. 2001) (allocating 5% of the costs to the park district due to many
factors, including the court’s finding that the district had done little to cause the
contamination); United States v. Davis,
31 F. Supp. 2d 45, 65–67 (D.R.I. 1998)
(allocating 35% of costs to transporters of chemicals even though the landfill
operator was at greater fault), aff’d,
261 F.3d 1 (1st Cir. 2001).
The dissent asserts that the district court abused its discretion because, in the
dissent’s view, the court’s two alternative methodologies rested on differing
underlying assumptions. The City has never raised this argument, so it is forfeited.
Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir. 1999). The dissent’s selective
quotations from the City’s "Statement of the Case," on page 6 of the opening brief,
are not sufficient to preserve the issue. Nowhere in that passage or elsewhere did
3
the City assert that the district court abused its discretion by using alternative
methods that rested on contradictory assumptions. Moreover, even if we read the
opening pages of the City’s brief expansively to encompass the argument, the
City’s bald assertion in passing is insufficient to preserve the issue. See, e.g.,
United States v. Graf, 610 F.3d 1148, 1166 (9th Cir. 2010) ("Arguments made in
passing and not supported by citations to the record or to case authority are
generally deemed waived."); Greenwood v. FAA, 28 F.3d 971, 977 (9th Cir. 1994)
("We review only issues which are argued specifically and distinctly in a party’s
opening brief."); id. ("We will not manufacture arguments for an appellant, and a
bare assertion does not preserve a claim.").
In any event, we are unpersuaded that the court’s use of alternative
methodologies was an abuse of discretion. The court’s primary method took
account of nuance: the court looked to 46 different plume circles, each extending
35 feet from a central point of measurement; the court allocated costs to each
party—the City, Mission, and Mission’s predecessor—depending on whether the
party’s activities contributed to the plume; and the court assigned proportionate
responsibility to the City and Mission for the predecessor’s share. The court’s
alternative method was simpler: it looked solely at the 46 points of measurement
and allocated all costs from on-site or on-the-border measurements to Mission and
4
all costs from purely off-site measurements to the City. We commend the district
court for checking the reasonableness of its nuanced primary methodology by
reference to a simpler alternative methodology.
AFFIRMED.
5
FILED
Mission Linen Supply v. City of Visalia, No. 19-15392
JUN 3 2020
COLLINS, Circuit Judge, dissenting: MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
This case involves an action under the Comprehensive Environmental
Response, Compensation, and Liability Act (“CERCLA”) to allocate responsibility
for underground pollution that originated at a dry-cleaning facility in the City of
Visalia, California. Between 1971 and 1983, Mission Linen Supply (“Mission”)
and the previous owner of the main property in question (Star Laundry & Dry
Cleaning (“Star”)) operated dry-cleaning facilities that discharged
perchloroethylene (“PCE”) into the City’s sewers. Due to the sewers’ numerous
defects and poor maintenance, PCE leaked out of the sewers and created a
substantial underground “plume” in the vicinity of the property. After a bench
trial, the district court allocated 50% of the responsibility for future cleanup costs
to Mission and 50% to the City. (Star was no longer in existence and was not a
party to the CERCLA action.) The majority rejects the City’s appeal, concluding
that the district court did not abuse its broad discretion. I respectfully dissent.
CERCLA explicitly gives district courts discretion to “allocate response
costs among liable parties using such equitable factors as the court determines are
appropriate.” 42 U.S.C. § 9613(f)(1). I agree that the district court did not abuse
its discretion in identifying the three principal considerations on which it based its
allocation decision: (1) how to divide up the pollution plume by its “geographic
1
features,” i.e., which portions of the plume counted as being on Mission’s property
and which counted as offsite; (2) how to assign responsibility for offsite portions of
the plume; and (3) how to allocate the “orphan” responsibility of Star. See Boeing
Co. v. Cascade Corp., 207 F.3d 1177, 1187 (9th Cir. 2000) (exercise of “discretion
to select factors” is reviewed only for abuse of discretion).
Having identified those considerations, the district court then needed to
make a judgment as to each of them and determine an appropriate allocation in
light of those judgments. We “review for clear error the allocation according to the
selected factors,” TDY Holdings, LLC v. United States, 885 F.3d 1142, 1147 (9th
Cir. 2018), meaning that “[w]e may not reverse a district court’s exercise of its
discretion unless we have a definite and firm conviction that the district court
committed a clear error of judgment in the conclusion it reached upon weighing the
relevant factors,” SEC v. Coldicutt,
258 F.3d 939, 941 (9th Cir. 2001). Here, the
district court committed a clear error of judgment by relying upon two sets of
internally inconsistent findings. See, e.g., Perez-Arceo v. Lynch,
821 F.3d 1178,
1186 (9th Cir. 2016) (“‘Factual findings that are internally inconsistent . . . are
clearly erroneous.’”) (quoting 9C WRIGHT & MILLER, FEDERAL PRACTICE AND
PROCEDURE § 2579 n.9 (3d ed. 2016)); Caruso Enters., Inc. v. U.S.A. Motel Corp.
(In re U.S.A. Motel Corp.),
450 F.2d 499, 503 (9th Cir. 1971) (findings are clearly
erroneous when they are “significantly contradictory”). Specifically, the district
2
court adopted two alternative sets of findings as to how to resolve the three key
questions it had identified, and these two methods rest on an unexplained mixing
and matching of contradictory answers to these three questions.1
In devising two alternative methods of allocation, the district court began
with the proposed allocation method of Mission’s expert, Keith O’Brien, and then
made various modifications to that method. As the district court explained,
O’Brien devised a color-coded map showing several dozen circles, each of which
was “imposed over the soil vapor contamination” in a given area of the property
and its vicinity. The district court concluded that these circles could “be used as a
form of units in measurement[,] . . . because they are indicative of the underlying
contamination plume.” O’Brien assigned those circles he characterized as being
1
The majority asserts that the City “has never raised this argument,” see
Memorandum at 3, but that is wrong. In its opening brief, the City explicitly
complained that, by invoking two alternative theories, the district court “did not
specify the theory with which it was rendering its decision” and that, as a result, its
findings are tainted by the “substantial flaw” that “the parties and this Court cannot
tell how the District Court actually arrived at its decision.” The fact that these
contentions were made in the City’s highly argumentative “Statement of the Case,”
see id., is of no moment; we should not ignore an argument simply because it is
made in one section of a brief versus another. See, e.g., United States v. Valdivia,
492 F.2d 199, 203–04 (9th Cir. 1973) (considering sufficiency-of-the-evidence
argument made in the “statement of facts” in the brief, even though the appellant
had “not devoted a specific section of his brief” to that argument). Moreover, after
expressly complaining about the district court’s use of alternative methods, the
City then goes on in its brief to explain why the district court’s various judgments
under each method were unexplained or flawed. That is enough to place the
adequacy of those findings before us, and the findings’ self-contradictory nature is
impossible to ignore.
3
on the property and away from the sewers to Mission and Star. The circles he
considered to be offsite he assigned in classes either to the City and Mission, to the
City and Star, or to the City, Mission, and Star, depending upon which companies
had been shown to have used which nearby sewer lines. For each such class of
circles, he divided the number of circles in the class by the number of parties
responsible for that class and then assigned each party an equal share of the circles
in that class. Having thus assigned total fractional shares of circles to each
responsible party, he calculated the ratio of Mission’s share to the City’s share and
then reassigned Star’s share to each in that same proportion. His method yielded
approximately 24 circles for the City and 22 for Mission.
The first of the two alternative methods adopted by the district court
followed O’Brien’s method, except that it applied a more lenient concept of what
counted as an onsite circle attributable to Mission and Star, thereby increasing the
number of such circles from three to nine. That resulted in an allocation of 15
circles to Mission, 16 to Star, and 15 to the City. Because Mission and Star each
had 15 circles, the court then reallocated Star’s 16 circles equally to Mission and
Star, giving each 23 circles—a 50/50 split.
In the second alternative method, the district court applied an even broader
concept of what counted as an onsite circle, increasing the number of such circles
from nine to 23. Having done so, however, it then changed its rule for allocating
4
the offsite circles: instead of allocating those circles to the City and the respective
users of the relevant sewer line, the court instead now allocated all of the offsite
circles to the City. It then likewise changed its rule for allocating Star’s share and
instead allocated it completely to Mission. That yielded 23 onsite circles allocated
entirely to Mission and 23 offsite circles allocated entirely to the City—the same
answer as the first method.
Although both alternative methods yielded the same 50/50 split, the two
methods rested on an arbitrary pairing of contradictory answers to the three key
allocation factors. In what I will call method “A,” the court applied these three
assumptions:
(A)(1) Defining onsite circles: The court narrowly defined what counted as
an onsite circle to be attributed to Mission and Star (although not as
narrowly as O’Brien).
(A)(2) Allocating offsite circles: For the offsite circles, the court allocated
responsibility equally to the City and to the relevant operators.
(A)(3) Allocating Star’s share: For the orphan share of Star, the court
allocated Star’s share equally to Mission and to the City based on
their respective total allocations from (A)(1) & (A)(2).
But in the alternative method (which I will call method “B”), it applied these
three different assumptions:
(B)(1) Defining onsite circles: The court more broadly defined what
counted as an onsite circle to be attributed to Mission and Star.
(B)(2) Allocating offsite circles: For the offsite circles, the court allocated
responsibility 100% to the City.
5
(B)(3) Allocating Star’s share: For the orphan share of Star, the court
allocated 100% to Mission.
The district court committed clear error by arbitrarily pairing collections of
contradictory answers to the three key allocation factors. The district court did not
explain why, for example, expanding the concept of an onsite circle (as in method
B) should lead to changing the methods for allocating offsite circles or Star’s
share. Nor did the court explain why it did not instead combine, say, assumption
(B)(1) with assumptions (A)(2) and (A)(3) (which would have yielded roughly a
37/63 split between the City and Mission) or assumption (B)(1) with assumptions
(A)(2) and (B)(3) (which would have yielded roughly a 22/78 split between the
City and Mission). The decision as to which of the opposite predicate assumptions
to pair with which of the other opposite predicate assumptions seems to me on this
record to have been wholly arbitrary.
The majority claims that these various contrary propositions can be
reconciled, but the logic escapes me. According to the majority, the first method
reflects “nuance” that attempted to allocate shares “depending on whether the
party’s activities contributed to the plume,” while the second method is “simpler”
and “allocated all costs from on-site or on-the-border [circles] to Mission and all
costs from purely off-site [circles] to the City.” Memorandum at 4–5. The
majority’s description of one method as “nuanced” and the other as “simpler”
simply begs the question. The majority never addresses, much less resolves, the
6
fundamental contradictions between the district court’s two methods, which are
that (1) they inexplicably used two significantly different understandings of what
constituted an onsite circle (one of which counted 23 circles as onsite, and the
other of which counted only nine as onsite); and (2) they inexplicably use two
different methods for re-allocating Star’s orphan share. One is not a “simpler”
form of the same, more “nuanced” analysis. Each is a different—and
contradictory—analysis.
We afford broad discretion to district courts in CERCLA cases, but we do so
based on the assumption that they will articulate a coherent and internally
consistent resolution of the major factors supporting any given allocation. That did
not happen here, and the resulting allocation therefore rests on clear error. I
respectfully dissent.
7
