• Restoration Versus Remediation
  • May 3, 2017 | Authors: Kevin T. Bright; Lila Wynne
  • Law Firm: Marshall Dennehey Warner Coleman & Goggin, P.C. - Cherry Hill Office
  • Recently, the New Jersey Department of Environmental Protection (NJDEP), its commissioner and the administrator of the New Jersey Spill Compensation Fund sought both damages in the form of remediation as well as primary restoration. Their demands for natural resource damages relate to “primary restoration,” which the state defines as returning groundwater to a pre-discharge state, i.e., pristine condition. Typically, PRPs responsible for conducting a remediation are obligated to remediate groundwater under the supervision of NJDEP and in accordance with its regulations until groundwater meets groundwater quality standards. For example, groundwater quality standards established by NJDEP for methyl tertiary butyl either (MTBE) is 70 parts per billion (PPB), which, according to NJDEP, is a human health-based criterion, and is groundwater that poses no risk and is safe for human consumption.

    Typically, a PRP is already remediating a contaminant in groundwater down to the GWQS and often times continues to decline through natural attenuation, which is defined as biodegradation and dispersion. This is often referred to as “Monitored Natural Attenuation” or “MNA.”

    Under controlling New Jersey case law, where a PRP is remediating groundwater in accordance with the regulations, and where the remediation has or will satisfy the applicable GWQS and has or will return the water to pre-discharge condition, primary restoration damages are only available when the state can establish a need to speed up the process. These damages may only be sought where there is an injury or threat to human health, flora or fauna that provides a reasonable basis or justification for an expedited remediation strategy. N.J. Dept. of Envtl. Prot. v. Essex Chem. Corp., No. A-0367-10T4, 2012 N.J. Super. Unpub. LEXIS 593, at *19 (App. Div. Mar. 20, 20120; N.J. Dept. of Envtl. Prot. v. Union Carbide Corp., No. MID-L-5632-07, Slip Op. at 7 (Law Div. Mar. 29, 2011); In re Methyl Tertiary Butyl Ether Prods. Liab. Litig., No. 1: 00-1898; MDL 1358 (SAS; M21-88, 2014 U.S. Dist. LEXIS 20676 at *11-12 (S.D.N.Y. Feb. 18, 2014) (Ridgewood MTBE).

    When primary restoration damages are sought in environmental cases, the defense should move for summary judgment, arguing that the plaintiffs must establish by a preponderance of the evidence that there is an impact or risk to human health or the environment that justifies expending remediation activities which will result in the imposition of significant cost on the defendants.

    The issue of primary restoration damages was addressed in two New Jersey cases. In the first case, NJDEP v. Essex, the New Jersey court addressed primary restoration damages in the context of groundwater contamination. Essex previously owned and operated a paper products preparation facility. For over 20 years, Essex conducted a soil and groundwater remediation program at this site, which was done with the oversight and approval of NJDEP. Thereafter, the state filed an action against Essex that included claims under the Spill Act to recover natural resource damages. The state of New Jersey sought $5.7 million in primary restoration damages for implementation of the NJDEP’s preferred remediation plan for returning the property to its pre-discharge condition in a more timely manner, as well as $2.3 million in compensatory damages.

    Offsite groundwater remained contaminated, but it was expected to reach pre-discharge conditions due to the remediation technologies employed at the site. The trial court held that NJDEP was not entitled to primary restoration damages because it failed to demonstrate a need to expedite remediation beyond what was already occurring at the site. The court stated:

    Although there has been an injury to the groundwater itself, the contamination has not affected any flora or fauna nor has it affected the health and/or safety of the people of the State. Primary restoration efforts made by Essex have been approved by SRP and have been shown to be effective. There is no compelling reason as to why remediation of this particular site should be expedited.

    On appeal, the Appellate Division affirmed, holding that the state failed to present sufficient justification for imposing primary restoration class on Essex for implementation of NJDEP’s expedited remediation plan. The state also failed to show that it would be harmful to implement the company’s plan. In addition, the Appellate Division held that the state’s experts did not establish that their analysis for determining compensatory damages would impose costs on Essex reasonably related to injuries caused by the site contamination. Therefore, all primary restoration damages in Essex were denied.

    Similarly, in NJDEP v. Union Carbide Corp., the trial court denied primary restoration damages for the same reasons. In Union Carbide, the responsible party was remediating contaminated groundwater under the supervision of NJDEP. The plaintiff’s litigation experts opined that a $500,000 primary restoration plan was required that would return groundwater to pre-discharge conditions in only eight to nine years. The trial court denied NJDEP’s claim for primary restoration damages.

    When defending natural resource damages claims, it is important to note that there is no statute or regulation authorizing the state to demand that natural resources be returned to pre-discharge conditions as quickly as possible, and the Spill Act is actually silent on the way to calculate natural resource damages.