PER CURIAM:
Appellants B.P. Exploration & Production, Inc. ("BP") and Anadarko Petroleum Corporation ("Anadarko") have filed petitions for en banc rehearing of our judgment affirming the lower court's grant of partial summary judgment. The en banc petitions remain pending. Although the parties have not filed separate petitions for panel rehearing, BP has "request[ed] that
This case involves the federal government's civil enforcement action under Section 311 of the Clean Water Act (CWA), 33 U.S.C. § 1321(b)(7)(A), stemming from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. Section 311, a strict liability provision, mandates the assessment of fines on the owners or operators of any vessel or facility "from which oil or a hazardous substance is discharged." Id. In the panel opinion, we affirmed summary judgment on the issue of Appellants' liability under that provision. Interpreting the CWA according to its plain terms, we held that "a vessel or facility is a point `from which oil or a hazardous substance is discharged' if it is a point at which controlled confinement is lost." In re Deepwater Horizon, 753 F.3d 570, 573 (5th Cir.2014) (quoting 33 U.S.C. § 1321(b)(7)(A)). We further determined that BP and Anadarko, as co-owners of the Macondo Well (the "well"), are liable under Section 311 because there was no dispute of material fact that controlled confinement of oil was lost in the well.
Appellants' various arguments challenging this holding can be grouped into two categories: those based on purported factual errors in the panel opinion, and those based on purported errors in the panel opinion's legal analysis. We address each in turn.
Anadarko first contends that the panel opinion was premised on a mistake of fact, pointing to the following sentence in the opinion's statement of facts: "As part of this preparation [for the Deepwater Horizon's departure from the well site], the well had been lined and sealed with cement." In re Deepwater Horizon, 753 F.3d at 573. Anadarko argues that, "[c]ontrary to the assumption of the Panel, all parties to this appeal agree that the cement never sealed off the well from the oil and gas in the rock formation beneath it." Anadarko Pet. Reh'g 2. Anadarko further contends that this purported factual error has created, and will continue to create, issues in the proceedings before the lower court. Anadarko Pet. Reh'g 13.
We are doubtful that the panel opinion has created any confusion on this issue. Nevertheless, we here clarify that the above statement was not intended to imply that the cement created a successful seal in the well. Anadarko is correct that all parties agree — and the record is clear — that the cement job failed to prevent hydrocarbons — e.g., oil — from migrating into the wellbore. Indeed, in the sentence following the one at issue, we stated that, "[b]efore the Deepwater Horizon departed, this cement failed, resulting in the high-pressure release of gas, oil, and other fluids." In re Deepwater Horizon, 753 F.3d at 571. In any event, this issue is a red herring. Whether the cement initially sealed the well was immaterial to the panel opinion's holding. As discussed in more detail below, it is only the fact that the cement in the well ultimately failed to stop the flow of oil (regardless of whether the cement at any prior point functioned as
Anadarko also argues that the panel's holding has effectively denied it its Seventh Amendment right to a jury trial, as Anadarko was not permitted to put forward evidence regarding where controlled confinement was lost. However, the lower court placed no limit on the admissible evidence Anadarko could put forward in opposition to the Government's motion for summary judgment, and in support of its cross-motion for summary judgment, on the issue of Anadarko's Section 311 liability. Moreover, in its summary judgment briefing, Anadarko conceded that there were no disputes of material fact with respect to this issue. See No. 2:10-MD-2179, Doc. 5113-2.
In any event, there are no additional facts that would alter our conclusion that controlled confinement was lost in the well. As we stated in the panel opinion, the only facts material to this analysis are undisputed. First, there is no question that Anadarko and BP are co-owners of the well. Nor do Appellants dispute that, as a result of the cement's failure, oil flowed into the well and, eventually, into the Gulf of Mexico. Before the lower court, in their responses to the Government's statement of undisputed facts, Appellants conceded for the purposes of summary judgment that "the cement job failed to prevent hydrocarbons in the formation from migrating into the wellbore." No. 2:10-MD-2179, Doc. 5113-3, at 5-6; see also Doc. 5124-1, at 2. Appellants further conceded that "[t]he Macondo well cement job was critical for maintaining well control." No. 2:10-MD-2179, Doc. 5124-1, at 2 (emphasis added); see also Doc. 5113-3, at 5 (stating that the "cement job was a means of maintaining well control").
Both BP and Anadarko attempt to shift the focus to the Deepwater Horizon and its appurtenances (owned by the Transocean entities), arguing that control was lost either (1) when the blowout preventer failed, or (2) when the drilling mud (which Anadarko contends is an appurtenance of the Transocean vessel) was displaced with seawater, causing oil to enter the well. But, as discussed in more detail below, our determination that controlled confinement was lost in the well does not preclude the possibility that controlled confinement was also lost elsewhere, an issue that we did not need to rule on. Further, with respect to the drilling mud, there is no dispute that its removal "allowed oil to escape from the formation" and into the well. Anadarko Suppl. Br. in Supp. of Pet. Reh'g 7. Again, the focus is on the well, and we come back to the loss of controlled confinement in the well. Moreover, the blowout preventer was not the first and only barrier to the discharge of oil. Rather, in BP's own words, "a [blowout preventer]... `operates as a failsafe device designed to stop a blowout from progressing and, in the event of loss of control, seal the well and stop the flow of oil.'" BP Blue Br. 11-12 (emphasis added) (quoting Bricklayers & Masons Local Union No. 5 Ohio Pension Fund v. Transocean Ltd., 866 F.Supp.2d 223, 230-31 (S.D.N.Y.2012)). Thus, as BP implies, a blowout preventer becomes necessary only when control of the oil has already been lost. Indeed, by contending that the court erred in determining "that controlled confinement of oil was irretrievably lost in the well," BP Suppl. Br. in Supp. of Pet. Reh'g 8, BP appears to concede that controlled confinement was initially lost in the well.
Therefore, Appellants' contention that controlled confinement was not lost in the well is belied by the undisputed facts in the record and by Appellants' own admissions.
Appellants also challenge the panel's legal conclusion that "a vessel or facility is a point `from which oil or a hazardous substance is discharged' if it is a point at which controlled confinement is lost." In re Deepwater Horizon, 753 F.3d at 573 (quoting 33 U.S.C. § 1321(b)(7)(A)).
As an initial matter, BP suggests that the panel "realized" that "only one instrumentality can bear [CWA] liability for a discharge of a given quantum of oil," BP Pet. Reh'g 10, and that the opinion's "logic... suggests that Transocean ... could not be held liable at all," BP Pet. Reh'g 2. Although Appellants would perhaps have
Appellants also attempt to distinguish the cases we relied upon in support of our holding. Anadarko points to the fact that there is "no reported decision in which the owner of a facility has been held liable for penalties after a discharge from a vessel connected to the facility." Anadarko Pet. Reh'g 7. BP similarly argues that "the cases on which the panel relied.... address the different situation where oil is discharged from a single instrumentality into the environment and it simply happens to flow across property owned by third parties (who bear no coequal legal responsibility as rig owners and operators to keep the oil confined) before reaching water." BP Pet. Reh'g 11. These arguments may be true so far as they go,
As explained in the panel opinion, our holding is consistent both with the caselaw interpreting Section 311 and with its history of enforcement. The panel opinion points to several cases and agency decisions where owners of facilities received fines under Section 311 for oil that was released from their facility, even though that oil subsequently flowed through conduits or over property owned by third parties before entering navigable water. See Pepperell Assocs. v. EPA, 246 F.3d 15, 20 (1st Cir.2001); Pryor Oil Co., Inc. v. United States, 299 F.Supp.2d 804, 806 (E.D.Tenn.2003); Union Petroleum Corp. v. United States, 651 F.2d 734, 228 Ct.Cl. 54, 56, 61-62 (Ct.Cl.1981); In re D & L Energy, Inc., V-W-13 C-006 (EPA ALJ Feb. 27, 2013); In re Phila. Macaroni Co., CWA-III-187 (EPA ALJ May 28, 1998).
BP also argues that the court failed to address BP's argument "that the location of the discharge depends on the instrumentality from which oil escapes confinement." BP Pet. Reh'g 8. According to BP, "when oil simply moves from one confined instrumentality to another without escaping, no Clean Water Act violation can possibly occur." BP Pet. Reh'g 9. Along those same lines, Anadarko asserts that "[c]ommonsense dictates that the movement of oil from a facility into a vessel does not retroactively become a `discharge' within the meaning of Section 311(b)(7) because the oil later exits the vessel's confinement into the environment." Anadarko Pet. Reh'g 6; see also Anadarko Suppl. Br. in Supp. of Pet Reh'g 5. This argument — which, prior to the petitions for rehearing, was raised in a single sentence in BP's opening brief, see BP Blue Br. 61
Appellants further argue that it was improper for the Panel to include a "control" element in defining a "discharge" under the CWA. Anadarko asserts that, "[i]n its transitive form, the verb `discharge' is defined as `[t]o release, as from confinement....' [and i]n its intransitive form, the verb `discharge' is defined, in part, as `[t]o pour forth, emit, or release contents.'" Anadarko Pet. Reh'g 5 n. 1 (quoting The American Heritage Dictionary of the English Language 530 (3d ed.1992)). But as Anadarko's own definitions suggest, the term "discharge" focuses not only on a loss of confinement but on the act of "releas[ing]." This connotes a loss of control. BP argues that inclusion of a "control" element to the test improperly
Anadarko also attacks the panel opinion's standard for determining the point from which oil is discharged as "unworkable." Anadarko hypothesizes "a system where 24 separately owned and operated wells connect to a vessel, which connects to a pipeline, which connects to a floating platform, which interconnects with an interstate pipeline, which interconnects with an onshore facility dozens of miles away," and asks: "How could a fact-finder find the precise point where `controlled confinement is lost' within that system?" Anadarko Pet. Reh'g 8. Anadarko, however, fails to give any reasons explaining why it would be difficult to determine where controlled confinement is lost in an interconnected system. In this case, for instance, it was not difficult to determine that the controlled confinement of oil was lost in the well. Second, Anadarko's hypothetical again assumes that there may only be a single point at which controlled confinement is lost, an issue we did not rule on.
Both BP and Anadarko also contend that the panel should have applied the rule of lenity or the anti-penalty canon to construe Section 311 narrowly so as not to apply to them. However, such presumptions are warranted only "if, after considering text, structure, history, and purpose, there remains a grievous ambiguity or uncertainty in the statute, such that the Court must simply guess as to what Congress intended." Barber v. Thomas, 560 U.S. 474, 488, 130 S.Ct. 2499, 177 L.Ed.2d 1 (2010) (internal citation and quotation marks omitted). Here, because the text of Section 311, and the history of its application, clearly demonstrate that a vessel or facility is a point "from which oil or a hazardous substance is discharged," 33 U.S.C. § 1321(b)(7)(A), if it is a point at which controlled confinement is lost, we decline Appellants' appeals to the rule of lenity and the anti-penalty canon.
Finally, BP argues that it is not, "as the panel thought, attempting to introduce concepts of `third-party fault' into the strict-liability scheme of the [CWA]." BP Pet. Reh'g 14. But this argument is contradicted by Appellants' briefing in this case, both before the panel and before the lower court. At multiple times in the course of this litigation, Appellants have attempted to shift liability to Transocean on the grounds that they were not at fault for the spill, but that Transocean was at fault.
For the reasons given in the panel opinion, as supplemented hereby, the panel continues to hold that the district court judgment was correct.