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Oct 11 2016

Appellate Court Upholds Jury Finding of No Liability for Historic Disposal

October 11, 2016 (Houston)

James SmithBy James Smith – “Environmental Alert” (Schirrmeister, Diaz-Arrastia, Brem LLP)

The First Court of Appeals, an intermediate Texas appellate court, upheld a jury finding of no liability for disposal that predated the Texas Solid Waste Disposal Act (“SWDA”) and the Texas Water Code (“TWC”).  Harris County v. International Paper.

A predecessor to International Paper arranged for a contractor to take its waste and dispose of it in pits near the San Jacinto River.  These pits are now a federal Superfund site, and International Paper is a potentially responsible party (“PRP”) regarding this site.  The case brought by Harris County (and the Texas Commission on Environmental Quality, as a necessary party) has no effect on International Paper’s status as a PRP for the site in the federal Superfund proceeding.

Disposal Pre-Dated the Texas Statutes, and Was Through a Contractor

The disposal occurred in the 1960s, prior to passage of the SWDA.  Harris County argued that subsequent releases from the pits, after passage in 1975 of the SWDA, could subject International Paper to penalties.  Harris County also argued that the disposal and subsequent releases constituted a violation of the TWC, which also post-dated the disposal.  The First Court of Appeals did not decide if disposal prior to passage of the SWDA or TWC could ever subject an entity to penalties, but upheld the jury’s determination of no liability in this case.

International Paper Did Not Retain Ownership to the Waste

The trial court found, and the appellate court agreed, that International Paper no longer owned the waste materials when the contractor placed the materials in the pits near the San Jacinto River.  At least for purposes of determining liability under the SWDA and TWC, the appellate court agreed that it was appropriate to inform the jury that International Paper no longer owned the waste materials during the later years, when dioxin from the waste released into the river.

Harris County Sought Penalties Beyond Cradle to Grave Responsibility

The case does not lessen the concept of “cradle to grave” responsibility for remediating waste materials, and International Paper still faces potential responsibility under the federal Superfund program. The result may discourage local and state governments from attempting to obtain penalties, above and beyond responsibility for remediation and/or response costs, for disposal activities that did not violate the law in effect at the time.

For a copy of the First Court of Appeals opinion click here.

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