Honorable Thomas M. Durkin, United States District Judge.
Plaintiff Clean Harbors Services, Inc. ("Clean Harbors") brought this action against Defendant The Illinois International Port District ("Port District") asserting claims under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. §§ 9607, 9613, the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6972, and state law. Presently before the Court is the Port District's Motion to Dismiss Counts II, III, and VIII of Clean Harbors' Third Amended Complaint. For the reasons explained below, the Port District's motion is granted in part and denied in part.
This case involves contaminated property located at 11700 and 11800 South Stony Island in Chicago, Illinois (the "property"). R. 108 ¶ 1. The Port District has owned the property since 1955. In the 1960s and 1970s, the Port District began to construct piers on the property with fill materials consisting of industrial waste, construction debris, natural material, and a mixture of soil, steel industry wastes, and pea-sized gravel. Id. ¶¶ 27, 30, 31. Also in the 1970s, the Port District leased the property to a now-dissolved company, Hyon Waste Management Services, Inc. Id. ¶ 36. Hyon Waste operated a series of surface impoundments
Beginning in the 1980s, the Port District leased the property to two different companies, ChemClear, Inc. and CMW Chemical Services, Inc., both of which Clean Harbors later acquired. (Throughout this Order, the Court refers to Clean Harbors and these companies collectively as "Clean Harbors.") Clean Harbors operated a waste processing facility at the property that processed hazardous wastes for disposal or recycling at offsite locations. Clean Harbors and the Port District are co-permittees on permits issued by the Illinois Environmental Protection Agency ("IEPA"). One such permit is a RCRA Part B permit, which was originally issued on November 4, 2005 and expired on December 9, 2015 (the "Permit"). The IEPA renewed the Permit effective September 6, 2017. R. 108 ¶ 197.
The IEPA eventually directed the Port District and Clean Harbors to conduct a RCRA facility investigation of the property. The parties performed the investigation and discovered contamination primarily related to Hyon Waste's operations in the 1970s. R. 108 ¶¶ 89-99. Clean Harbors incurred substantial costs to conduct the investigation. Id. ¶ 150. The Port District and Clean Harbors subsequently worked with the IEPA to develop a corrective action plan to address the contamination (known as the "Cap and Drain Plan"). IEPA gave its final approval for the plan in 2011. Id. ¶ 123. The IEPA's plan required that an existing cover at the property remain in place as an engineered barrier, required the construction of a french drain, and required future groundwater monitoring at the property. The Plan is projected to cost $5.75 million in construction costs and an additional $ 2.15 million in monitoring costs. Id. ¶ 151.
In 2012, Clean Harbors provided notice of its intent to terminate its leases on the property and identified issues related to the Cap and Drain Plan that needed to be resolved as part of its winding down of operations at the property. R. 108 ¶¶ 130-131. Two weeks after Clean Harbors gave notice of its intent to terminate the leases, the Port District wrote to the IEPA stating it had not approved the Cap and Drain Plan. Id. ¶ 135. Later in 2012, the Port District demanded that Clean Harbors remove the engineered barrier discussed in the Plan, demanded it construct a truck yard on the property, and refused to grant it access to the property to remove certain improvements. Id. ¶ 140-42. The Port District also refused to complete forms required to wind down Clean Harbors' operations properly with the IEPA. Id. ¶ 146. Finally, Clean Harbors alleges the Port District overcharged it quarterly rent payments from 2010 through 2012 totaling $315,000. Id. ¶ 78.
On February 19, 2013, Clean Harbors provided written notice to the Port District, the IEPA, and the U.S. Environmental Protection Agency ("EPA") of its intent to file a RCRA citizen suit against the Port District pursuant to 42 U.S.C. § 6972. The notice letter accused the Port District of violating the parties' IEPA permit by refusing to implement the Cap and Drain Plan, refusing to take financial responsibility for its share of the clean-up under the Plan, refusing to execute documents to allow for the closure of RCRA units (through Clean Harbors) at the property, and by demanding that the engineered barrier be removed in violation of the Cap
In December 2013, the Court stayed the case to allow the IEPA to approve Phase II of the Cap and Drain Plan. R. 65. In January 2017, the Court resumed proceedings. R. 98. Clean Harbors subsequently filed its Third Amended Complaint ("TAC") on October 10, 2017. R. 108. At issue in this dispute are Counts II, III, and VIII. In Count II of the TAC, Clean Harbors asserts a cause of action under the endangerment citizen suit provision of the RCRA, 42 U.S.C. § 6972(a)(1)(B). In Count III, Clean Harbors brings a citizen suit claim to abate RCRA permit violations under 42 U.S.C. § 6972(a)(1)(A). Both counts allege Clean Harbors provided pre-suit notice to the Port District on February 19, 2013. R. 108 ¶¶ 186, 215. In Count VIII, Clean Harbors alleges the Port District was unjustly enriched after it refused to return rent overpayments Clean Harbors made. Id. ¶¶ 237-244.
On October 31, 2017, the Port District filed a motion to dismiss Counts II, III, and VIII of the TAC under Fed. R. Civ. P. 12(b)(1) and 12(b)(6). As to the RCRA claims, the Port District argues Clean Harbors (1) failed to allege any facts showing it has an "injury in fact" to demonstrate standing under Article III of the Constitution; (2) failed to provide adequate pre-suit notice; and (3) failed to sufficiently allege RCRA violations under each provision. The Port District argues that Count VIII should be dismissed because Clean Harbors improperly bases its unjust enrichment claim on an express written contract.
A Rule 12(b)(6) motion challenges the sufficiency of the complaint. See Hallinan v. Fraternal Order of Police of Chicago Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). Under Rule 8(a)(2), a complaint must include "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). Under the federal notice pleading standards, a plaintiff's "factual allegations must be enough to raise a right to relief above the speculative level." Bell Atlantic v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Put differently, a "complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). "In evaluating the sufficiency of the complaint, [courts] view it in the light most favorable to the plaintiff, taking as true all well-pleaded factual allegations and making all possible inferences from the allegations in the plaintiff's favor." AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir. 2011).
Rule 12(b)(1) authorizes the Court to dismiss any claim for which the Court lacks subject matter jurisdiction according to Article III, Section 2 of the U.S. Constitution. When a defendant challenges jurisdiction, the plaintiff bears the burden of establishing a court's jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). As with 12(b)(6) motions, in deciding a Rule 12(b)(1) motion the Court must "accept as true all well-pleaded factual allegations and draw all reasonable inferences in favor of the plaintiff." St. John's United Church of Christ v. City of Chi., 502 F.3d 616, 625 (7th Cir. 2007) (quotation marks omitted).
The RCRA was enacted to aid in a national policy to reduce or eliminate hazardous waste "as expeditiously as possible." 42 U.S.C. § 6902(b). Waste that cannot be eliminated "should be treated, stored, or disposed of so as to minimize the present and future threat to human health and the environment." Id. To help enforce this goal, Congress enacted a citizen-suit provision that allows "any person" to commence a civil action against alleged violators of the RCRA. 42 U.S.C. § 6972.
RCRA authorizes two general types of citizen suits. First, a plaintiff may commence a civil action against "any person... who is alleged to be in violation of any permit, standard, regulation, condition, requirement, prohibition, or order which has become effective pursuant to this chapter." 42 U.S.C. § 6972(a)(1)(A). To proceed under subsection (a)(1)(A), a plaintiff is generally required to provide 60 days advance notice to the EPA Administrator, the State in which the violation occurred, and the alleged violator. Id. § 6972(b)(1)(A) ("No action may be commenced under subsection (a)(1)(A) ... prior to 60 days after the plaintiff has given notice of the violation to (i) the [EPA] Administrator; (ii) the State in which the alleged violation occurs; [and] (iii) to any alleged violator of such permit, standard, regulation, condition, requirement, prohibition, or order."). Second, a plaintiff may commence a civil action against "any person ... who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment." Id. § 6972(a)(1)(B). To proceed under subsection (a)(1)(B), a plaintiff is generally required to provide 90 days advance notice. Id. § 6972(b)(2)(A) ("No action may be commenced under subsection (a)(1)(B) ... prior to ninety days after the plaintiff has given notice of the endangerment to (i) the [EPA] Administrator; (ii) the State in which the alleged endangerment may occur; [and] (iii) any person alleged to have contributed or to be contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste."). There are exceptions to these notice provisions, but they are not relevant here.
In Counts II and III, Clean Harbors brings both types of citizen suits. Count II, (the "Endangerment Claim"), is a claim under § 6972(a)(1)(B). Clean Harbors alleges that the Port District was at all relevant times the owner of the property and (1) actively contributed to the contamination through the construction of the piers on the property; (2) knew and approved of hazardous waste handling, treatment, storage, and disposal activities at the property by Hyon Waste; and (3) presents an imminent and substantial endangerment to health and the environment through its demands that the engineered barrier be removed from the property. R. 108 ¶¶ 170, 171, 185. Clean Harbors alleges it issued a written notice and demand to the Port District, the EPA Administrator, and the IEPA as required by 42 U.S.C. § 6972(b)(2)(A) on February 19, 2013. Id. ¶ 186; see also R. 108-5 at 23-24.
In Count III, Clean Harbors brings a claim under § 6972(a)(1)(A) (the "Permit Claim"). Clean Harbors alleges the Port District violated the Permit by demanding that Clean Harbors remove engineered barriers approved as part of the Cap and Drain Plan; by refusing to implement and pay its fair share of the costs of the Cap and Drain Plan; and by obstructing Clean Harbors from accessing the Property to monitor ground water conditions in compliance with the Permit. R. 108 ¶¶ 197-201.
To establish standing under Article III of the Constitution, Clean Harbors must plead: (1) a "concrete and particularized" injury in fact that may be either "actual or imminent;" (2) a causal connection between the injury and the conduct complained of; and (3) a likelihood that a favorable decision will result in a remedy for the plaintiff. Lujan, 504 U.S. at 560-61, 112 S.Ct. 2130. The relevant showing for purposes of Article III standing is not injury to the environment but injury to the plaintiff. Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 181, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000).
Further, "injury in fact" is loosely defined by courts as requiring a "personal stake in the outcome" of the litigation, (see Sierra Club v. Morton, 405 U.S. 727, 731-32, 92 S.Ct. 1361, 31 L.Ed.2d 636 (1972)), or the "invasion of a legally protected interest" (Lujan, 504 U.S. at 560, 112 S.Ct. 2130). "The injury in fact requirement precludes those with merely generalized grievances from bringing suit to vindicate an interest common to the entire public." Friends of the Earth, Inc. v. Gaston Copper Recycling Corp., 204 F.3d 149, 156 (4th Cir. 2000) (citing Lujan, 504 U.S. at 575, 112 S.Ct. 2130.) A plaintiff must differentiate himself from the mass of people who may find the conduct of which he complains to be objectionable only in an abstract sense. Id. The alleged injury "must affect the plaintiff in a personal and individual way." Id.
The Port District appears to confuse Article III standing with standing under a statute. It argues Clean Harbors has failed to allege that "it has any concerns — health, environmental, aesthetic, recreational, injury, or otherwise," R. 116 at 1, and that monetary claims do not provide the "necessary injury-in-fact under RCRA," Id. at 2 (emphasis added). But Article III does not require nor bar specific injuries. Instead, it requires only that a plaintiff show it has an injury that is "concrete and particularized" enough to move beyond the world of individuals with only "generalized grievances." According to these standards, Clean Harbors has sufficiently alleged an injury in fact — it alleges it has incurred substantial costs due to the previous contamination of the property and continues to be injured due to the Port District's actions in violation of the Cap and Drain Plan. See R. 108 ¶¶ 86, 184-185, 198-216. Clean Harbors' injury is not the "generalized grievance" Article III intends to deter.
Neither of the cases the Port District cites support its argument. In Premier Assocs., Inc. v. EXL Polymers, Inc., 2010 WL 2838497 (N.D. Ga. July 19, 2010), aff'd in part, 507 Fed.Appx. 831 (11th Cir. 2013), the court found the counterclaimant did not have standing under the RCRA to bring a claim because he had no injury — his only allegations of harm were the possibility of being found liable under the RCRA claim brought by the plaintiff. Id. at *3. The counterclaimant had alleged no
Consequently, the Court concludes that Clean Harbors has established a basis for constitutional standing, and the Port District's motion to dismiss on that issue is denied.
The Port District next argues that Clean Harbors failed to meet the pre-suit notice requirements of the RCRA in regard to both its Endangerment and Permit claims. Specifically, the Port District argues Clean Harbors' pre-suit notice was deficient because: (1) it failed to give the Port District notice that it used contaminated material to construct the piers (the "pier allegations"); (2) it failed to cite any regulations or sections of the RCRA permit provisions that the Port District violated (the "permit allegations"); and finally (3) it failed to notify the Port District of its obstruction of access to the property as alleged in ¶ 201 of Count III (the "obstruction allegation"). R. 112 at 5-6, 11-12; R.116 at 3.
The RCRA requires parties to notify a RCRA violator before commencing suit, but it does not specify what notice is required. 42 U.S.C. § 6972(b). The Supreme Court has held that notice under the RCRA is a requirement that may not be disregarded, but has also failed to provide any direction as to the contents of the notice. See Hallstrom v. Tillamook Cty., 493 U.S. 20, 31, 110 S.Ct. 304, 107 L.Ed.2d 237 (1989). The Seventh Circuit, however, has provided guidance on what notice is required. In Atlantic States Legal Foundation, Inc. v. Stroh Die Casting Co., 116 F.3d 814 (7th Cir. 1997),
Further, Congress has authorized the EPA to oversee the implementation of the RCRA and to issue regulations with the force of law to support the RCRA's purposes. See 42 U.S.C. § 6912(a)(1); City of Chicago v. Envtl. Def. Fund, 511 U.S. 328, 330, 114 S.Ct. 1588, 128 L.Ed.2d 302 (1994) (noting that RCRA implementing regulations come from the EPA). The EPA has promulgated several regulations that provide guidance in interpreting the RCRA, including in the interpretation of pre-suit notice requirements, as discussed below. See 40 C.F.R. § 254.3 (discussing pre-suit notice requirements for Permit claims).
The Port District argues that Clean Harbors failed to provide it with any notice of the pier allegations in its notice letter. The Court agrees. Clean Harbors' notice,
The EPA requires notice regarding a permit violation to include sufficient information to allow the recipient to (1) identify the specific permit, standard, regulation, condition, requirement, or order which has allegedly been violated; (2) the activity alleged to constitute a violation; (3) the person or persons responsible for the alleged violation; (4) the date or dates of the violation; and (5) the full name, address, and telephone number of the person giving notice. 40 C.F.R. § 254.3. In its notice letter, Clean Harbors met the first requirement by identifying the Permit and the specific sections allegedly violated. See R. 108-5 at 21 ("The Port District's conduct constitutes a violation of the Permit, including Attachment I of the Permit"). Contrary to the Port District's arguments, 40 C.F.R. § 254.3 does not require citation to "a single regulation or section of RCRA." R. 112 at 11. An identification of the "specific permit" is sufficient, which is what Clean Harbors provided. See R. 108-5 at 21.
Clean Harbors then specified the activities that caused the violation, including the Port District's refusal to implement the Cap and Drain Plan, its refusal to cooperate to execute Permit modifications, and its demand that the engineered barrier on the property be removed. Id. This provides notice to the Port District of the second requirement as well. The Port District does not argue that Clean Harbors failed to satisfy the remaining requirements of 40 C.F.R. § 254.3. The Court finds Clean Harbors provided sufficient notice to the Port District to inform it "about what it is doing wrong" as to the permit allegations.
Finally, the Port District argues that Clean Harbors' allegations that "the Port District has obstructed Clean Harbors from accessing the Property in order to monitor ground water conditions in compliance with the Permit" (R. 108 ¶ 201) were not included in the pre-suit notice and must be dismissed. Clean Harbors provided written notice to the Port District of certain violations on October 2, 2012 and provided notice of additional violations on February 19, 2013. R. 6-5 at 21; 108-5 at 19. The October notice accused the Port District of, among other things, refusing to grant Clean Harbors access to the property "for the purpose of allowing Clean Harbors to comply with conditions and requirements of the RCRA Permit, including monitoring the facility perimeter and systems." Id. The parties have not indicated that the previous notice letter is invalid or has been withdrawn. The Court finds that Clean Harbors' October notice that the Port District refused to grant it access to the property for purposes of monitoring sufficiently provided the Port District notice of the allegations in ¶ 201.
RCRA's endangerment provision authorizes suit against "any past or present generator, past or present transporter, or past or present owner or operator of a treatment, storage or disposal facility, who has contributed or is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment." 42 U.S.C. § 6972(a)(1)(B) (emphasis added). The Seventh Circuit has interpreted the "has contributed or is contributing to" language of the RCRA to require active involvement and affirmative action rather than passive conduct. Sycamore Indus. Park Assocs. v. Ericsson, Inc., 546 F.3d 847, 854 (7th Cir. 2008).
The Port District cites cases to support its argument that merely being an owner of the property is insufficient to find it was actively involved with the contamination. R. 112 at 8-9. But the Port District's cases dealt with owners of properties who had purchased the properties after the contamination, not with owners alleged to be actively involved in the contamination. See e.g, Town & Country Co-Op, Inc. v. Akron Prod. Co., 2012 WL 1668154, at *4 (N.D. Ohio May 11, 2012) (dismissing successor property owner but refusing to dismiss claim against the previous owner who had allegedly contaminated the property); Marriott Corp. v. Simkins Indus., Inc., 929 F.Supp. 396, 398 n.2 (S.D. Fla. 1996) (discussing dismissed RCRA claim against Marriot because it was a "subsequent purchaser of previously contaminated property"); Interfaith Cmty. Org. v. Honeywell Int'l, Inc., 263 F.Supp.2d 796, 804 (D.N.J. 2003), aff'd, 399 F.3d 248 (3d Cir. 2005) (noting the defendants are the present owners and another party "actually deposited the contaminated material at the Site.")
Clean Harbors alleges the Port District was the owner of the property at the time of contamination and had an active role in the contamination — it alleges the Port District authorized Hyon Waste to contaminate; failed to hold Hyon Waste accountable for its contamination activities; and demands Clean Harbors remove the engineered barrier that prevents additional contamination. See R. 108 ¶¶ 51-53, 170-172, 185. Whether Clean Harbors can show the Port District's role with Hyon Waste was in fact active rather than passive is a matter for summary judgment or trial. At this stage, however, Clean Harbors' allegations are sufficient to plead that the Port District "contributed or is contributing to" the contamination to sustain its RCRA Endangerment Claim. See Carlson v. Ameren Corp., 2011 WL 223015, at *2 (C.D. Ill. Jan. 21, 2011) (finding sufficient allegations of affirmative action when the counter-defendants prevented Ameren from accessing and repairing the land).
Because the Court finds that Clean Harbors failed to provide pre-suit notice as to the pier allegations, the issues remaining under Count III involve Clean Harbors' allegations that the Port District violated the Permit provisions by refusing to implement the Cap and Drain Plan, refusing to execute the closure forms, and by denying Clean Harbors access to the property. All the RCRA requires are allegations of (1) [a] violation of (2) any permit, standard, regulation, condition, requirement, prohibition, or order (3) which has become effective pursuant to the RCRA. 42 U.S.C.A. § 6972(a)(1)(A). As in its argument on the Endangerment Claim, the Port District fails to point to any case law that indicates "internal disputes between alleged co-permittees" or "mere demand[s]," R. 112 at 13, are not violations of the RCRA as a matter of law. Clean Harbors sufficiently alleges that the Port District violated a RCRA permit and states a plausible claim to meet the requirements provided by 42 U.S.C. § 6972(a)(1)(A). The Port District's motion to dismiss Count III is granted as to the pier allegations but denied in all other respects.
In Count VIII, Clean Harbors alleges the Port District overcharged it for rental payments. Specifically, Clean Harbors alleges the parties entered into an amendment of the lease, which required Clean Harbors to pay the Port District a percentage of its gross annual revenues. R. 108 ¶ 76. The payments were set to expire in 2009, but the Port District continued to charge Clean Harbors through 2012, in an amount totaling $315,000. Id. ¶ 78. Clean Harbors alleges the Port District has refused to return the overcharge, even after Clean Harbors sent a demand letter. Id. ¶¶ 80, 241.
As a general rule, parties may not bring unjust enrichment claims where a contract governs. See Utility Audit Inc. v. Horace Mann Srvc. Corp., 383 F.3d 683, 688-89 (7th Cir. 2004) ("When two parties' relationship is governed by contract, they may not bring a claim of unjust enrichment unless the claim falls outside the contract.") Illinois courts, however, have allowed unjust enrichment claims based on payments that were not included in the contract. See e.g., Stark Excavating, Inc. v. Carter Const. Servs., Inc., 2012 IL App (4th) 110357, ¶ 38, 359 Ill.Dec. 735, 967 N.E.2d 465; see also Fifth Third Bank v. Automobili Lamborghini S.P.A., 2011 WL 307406, at *4 (N.D. Ill. Jan. 26, 2011) ("Thus, under Illinois law, a party may pursue an unjust enrichment claim for a mistaken payment, even where a contract governs the relationship between the parties, if the payee is not, in fact, entitled to payment.").
Clean Harbors argues the overcharges were not part of the lease agreement after 2009 and are not barred under a theory of unjust enrichment. R. 116 at 15. Indeed, the lease amendment discusses quarterly payments only through 2009, R. 108-3 at 35, and neither the lease nor the subsequent amendments discuss overpayments. See generally, R. 108-3. Because Clean
For the foregoing reasons, Defendant's motion to dismiss the Third Amended Complaint, R. 111, is (1) granted as to pier allegations in Counts II and III and (2) denied in all other respects.
