PCB public nuisance litigation could be creating costly future liability for local government, officials say

By Amanda Robert | Feb 13, 2017

SAN DIEGO - In the latest wave of public nuisance cases to hit California, cities blaming Monsanto for contaminating local waterways could also be exposing themselves to future liability and economic harm, say former public officials who oppose this type of litigation.

“As San Diegans, our waterways are so critical to our life,” said Scott Barnett, who served on the Del Mar City Council. “Yes, we need to make sure that we try to keep our waterways clean, and that those who are responsible for polluting are held liable. But this approach could end up costing the city and giving money to lawyers on both sides.”

Monsanto lawfully manufactured polychlorinated biphenyl (PCB), an insulation used in electronic equipment from 1935 through 1977, and was not involved in the disposal of products containing PCBs. However, the two plaintiffs’ law firms, Baron & Budd and Gomez Trial Attorneys, representing San Diego, Long Beach and Oakland, along with several other cities, are relying on public nuisance law in their claims that the company should pay the cost of cleaning up waterways.

The public nuisance law that exists in California comes from an old common law that was called on if a tree blocked a road or a river used for commerce. The law evolved to include brothels and gambling halls as public nuisances, and carries no statute of limitations.

“With tight budgets, sometimes this seems like a way to make ends meet,” said former Los Angeles city attorney Carmen Trutanich. “But you have to be smart about what you choose to get involved in as a municipality because you could be opening doors to things that could haunt your city for years to come. This PCB litigation looks to be that way.”

Trutanich, now counsel at Tucker Ellis in Los Angeles, draws a parallel between the PCB litigation and the ongoing lead paint litigation brought by 10 California cities and counties. In that case, the judge ordered a $1.15 billion judgment against the companies that manufactured lead pigment and paints, but also essentially labeled all residential properties built before 1981 a public nuisance.

He contends that the cities and counties that joined the lawsuit failed to consider the possible impact to homeowners and property owners, who may be required to spend millions of dollars to remove lead paint from their homes.

Trutanich adds that the PCB litigation is more extreme, since under the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, owners of hazardous waste sites share responsibility for cleaning them up.

“Right now, the city does not own the waterway or the shoreline, it’s owned by the federal government,” he said. “But if cities are going to start suing for things getting in the ocean – and there are a lot of chemicals that come via the storm drains that we are now claiming ownership over – we may be creating a liability that we may not be able to afford in the future.”

Barnett, an appointed member of the Little Hoover Commission, which reviews government programs and budgets in California, adds that many more agencies could have been swept into the case if their public officials failed to do their due diligence.

He references an October 2015 e-mail, obtained by the Northern California Record, in which John Fiske of Gomez Trial Attorneys invited Neal Shapiro, the watershed and urban runoff coordinator for the city of Santa Monica, to a meeting with Los Angeles County and Port of Long Beach attorneys and engineers to discuss the PCB litigation.

“After speaking with legal counsel for Los Angeles County, they suggested that a county wide meeting would be appropriate where all permittees in the County, including cities and ports, could be invited to hear about the steps being taken by our firms to assist with this onerous problem,” Fiske said in the e-mail.

Barnett contends that the e-mail shows that plaintiffs’ attorneys “shopped this dodgy legal theory around” to not just the cities currently involved, but to every stormwater or wastewater permit holder, city and port in Los Angeles County.

“That's approximately 100 public agencies,” he said. “They all considered it and apparently didn’t think it was good public policy to proceed. Sadly, only a handful of cities like San Diego took the bait.”

As the founder of TaxpayersAdvocate.org, Barnett also argues that San Diego failed to protect taxpayers by indemnifying them against future counterclaims in its agreement with the plaintiffs’ law firms. He says this could be especially harmful in this case, where the Port of San Diego is also suing federal agencies like the U.S. Navy.

“What is the potential liability to the city and the port if the litigation goes sideways?” he said. “When people say there is no downside, and there is only upside and no risk, that’s when you need to start asking a few more penetrating follow-up questions.”

Trutanich predicts that in addition to the impact on taxpayers, the PCB litigation may have a significant impact on business development. He explains that if a company that develops products for a particular industry is held responsible every time someone improperly uses or disposes its products, the company probably won’t continue developing those products.

“That’s like if someone bumps into your car and they’re driving a Chevy, instead of suing the guy, you’re suing General Motors,” Trutanich said. “You’re saying that if they wouldn’t have built it, you wouldn’t have gotten into an accident.

“It’s so far removed from the factual reality of the situation that it almost doesn’t make sense. It extends the law to a place where it truly does have a chilling effect.”

Trutanich, who has tried a number of cases under CERCLA, says the law is designed to hold the disposer, and not the developer, accountable. He says that public officials should stay close to the intent of the law and avoid extending it judicially.

Barnett agrees that public officials should discuss the problem with their congressional representatives rather than risking it all in court.

“That’s the way it should be resolved, not going through some law firm just looking for a big windfall,” he said.

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