This consolidated appeal of two separate actions requires us to consider the constitutionality of an innovative municipal ordinance enacted by the City of Lodi, California (“Lodi” or “the City”) to remedy hazardous waste contamination within its borders. Fireman’s Fund Insurance Company (“Fireman’s Fund”), Unigard Insurance Company, and Unigard Security Insurance Company (“Unigard”) (collectively “the Insurers”) appeal from the district court’s judgments in favor of Lodi in the Insurers’ separate but related actions for declaratory and injunctive relief. Both Fireman’s Fund and Unigard filed suit to prevent Lodi from enforcing the local ordinance, named the Comprehensive Municipal Environmental Response and Liability Ordinance (“MERLO” or “the Ordinance”), which permits the City to investigate and remediate the hazardous waste contamination of its soil and groundwater.
The Insurers allege that MERLO is preempted by the federal Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), 42 U.S.C. §§ 9601-9675, and by various state laws including California’s Carpenter-Presley-Tanner Hazardous Substance Account Act, (“HSAA”), Cal. Health & Safety (“H & S”) Code §§ 25300-25395.15.
I.
BACKGROUND
A. The Contamination of Lodi’s Water
Lodi first detected the presence of tetrachloroethylene (“PCE”), in its groundwater in April 1989. PCE is a known carcinogen that is often used as a dry-cleaning agent.
Groundwater is Lodi’s sole source of drinking water and the primary source of water for agricultural use in California’s Central Valley.
In 1993, the Department of Toxic Substances Control (“DTSC”) of the California Environmental Protection Agency began investigating Lodi’s PCE contamination. DTSC is the state agency responsible for ensuring that California’s public health and environment are protected from the harmful effects of hazardous substances. See Cal. H & S Code §§ 25312, 25313, 25350-25359.8. DTSC is authorized to oversee the cleanup of hazardous waste sites by issuing remedial orders and by entering into agreements with “potentially responsible parties” (“PRPs” or “RPs”) to facilitate remediation.
DTSC’s investigation revealed that four small businesses were potentially responsible for the PCE-contaminated waste-water that migrated throughout Lodi by land disposal, sewer lines, and city water wells. One business, Lustre-Cal Nameplate Corporation (“Lustre Cal”) — a manufacturer of color anodized and etched aluminum nameplates and labels — is insured by defendant Fireman’s Fund. Another busi
B. Lodi’s Investigation and Remediation Strategy
In May 1997, Lodi and DTSC entered into a “Comprehensive Joint Cooperation Agreement” (“Cooperative Agreement” or “Agreement”).
In furtherance of remediation, the Agreement, at section VI.(A)(1), requires Lodi to:
*935 utiliz[e], as appropriate, the full range of its remedial and regulatory injunctive and cost recovery authority under federal, state and municipal law, to compel the complete, timely, competent, cost-effective performance of the Work in full compliance with federal, state and local law, specifically including the NCP,7 as appropriate. These enforcement efforts will include ... the prompt enactment and enforcement of a comprehensive municipal environmental response ordinance which shall enact into municipal law additional legal authorities to appropriately supplement the City of Lodi’s already extensive environmental response authority under federal, state and local law....
In consideration for Lodi’s agreement to reimburse DTSC, DTSC grants Lodi a “covenant not to sue with respect to claims arising from ... Lodi’s design, construction, operation or maintenance of any storm or sanitary sewer systems.” DTSC also agrees to protect Lodi from contribution actions under CERCLA, 42 U.S.C. § 9613(f)(2), and California’s contribution statute, Cal.Code Civ. Pro. § 877, for “matters addressed” in the Cooperative Agreement.
On August 6, 1997, Lodi’s City Council enacted the “comprehensive municipal environment response and liability ordinance” as required by the Cooperative Agreement. Ordinance 1650 — commonly known as MERLO — is the subject of this suit. It sets forth a comprehensive remedial liability scheme modeled on CERCLA and HSAA. MERLO specifically provides Lodi with municipal authority to investigate and remediate existing or threatened environmental nuisances affecting the City, and to hold PRPs or their insurers liable for the cost of the City’s nuisance abatement activities. See generally MERLO §§ 8.24.010-8.24.090.
MERLO is modeled on both CERCLA and HSAA, and it incorporates many of the standards employed by CERCLA and HSAA. For example, MERLO utilizes the CERCLA and HSAA definition of who may be considered a PRP, see MERLO § 8.24.040(A)(1), and, like CERCLA, imposes joint and several liability on PRPs. See MERLO § 8.24.040(E).
C. Procedural History of the Present Actions
As set forth above, this consolidated appeal involves two separate but related challenges to MERLO — one brought by Unigard, and a second brought by Fireman’s Fund.
1. The Origins of the Unigard and Fireman’s Fund Actions
In May 1998, Lodi filed an abatement action pursuant to its authority under MERLO against Unigard’s insured, M & P Investments. Three weeks later, Unigard filed the present action in United States District Court for the Northern District of California. In its complaint, Unigard alleges that Lodi adopted MERLO in order to shift its own liability for the PCE contamination to the insurers of other PRPs. Unigard’s complaint further alleges that MERLO: (1) violates the Supremacy Clause of the United States Constitution because it is preempted by CERCLA; (2) violates Article 11 of the California State Constitution because it is preempted by HSAA and California Insurance Code § 11580; and (3) violates the Contracts Clause of the United' States Constitution.
Finding that Unigard’s claims “have an insufficient connection to the Northern District of California,” the District Court transferred the action to the Eastern District of California. All of Unigard’s claims were dismissed prior to the.transfer, with the exception of the federal and state preemption claims, and the federal contracts clause claim.
In August 1998, Fireman’s Fund filed a similar declaratory and injunctive relief action against Lodi in the United States District Court for the Eastern District of California. In addition to naming Lodi as a defendant, Fireman’s Fund also named: (1) Lodi’s Mayor, Jack Sieglock, in his official capacity; (2) MERLO Enforcement Officers Richard C. Prima, Jr. and Fran E. Forkas in their official capacities; (3) Lodi City Attorney Randall A. Hays in his official and individual capacities; and (4) Michael C. Donovan and Zevnik Horton Gui-bord & McGovern, LLP (collectively, the “Law Firm”), private attorneys acting as assistant city attorneys for Lodi, in their official and individual capacities.
On August 24, 1998, Fireman’s Fund, joined by Unigard, moved for a preliminary injunction prohibiting Lodi from enforcing MERLO. While the Insurers’ preliminary injunction motion was pending, Lodi and its officers moved, in both actions, to dismiss the Insurers’ complaints pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, and Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. At the same time, Fireman’s Fund filed a motion for partial summary judgment and for a permanent injunction to enjoin Lodi from enforcing MERLO.
After extensive briefing by all parties, the district court held a joint hearing on all motions in both cases on December 4, 1998. Following the hearing, the district court issued two written decisions, one in each action.
2. The Unigard Decision
In an unpublished decision, the district court found Unigard’s claims ripe for review because “the content of [MERLO] is clear as are the City’s intentions to enforce the Ordinance against Unigard.” Unigard Ins. Co. v. City of Lodi, No. Civ. S. 98-1712-FCD-JFM at *5 (E.D.Cal. Mar. 5, 1999). The district court also found that Unigard has standing to bring the present action, id. at 6, and that MERLO is not preempted by CERCLA, id. at 6-13. Finally, the district court abstained under the Pullman abstention doctrine
3. The Fireman’s Fund Decision
In a published opinion, the district court dismissed Fireman’s Fund’s claims against the individual defendants in their official capacities as “duplicative of the claims against the City.” Fireman’s Fund Ins. Co. v. City of Lodi,
Based on these rulings, the district court denied Fireman’s Fund’s motion for partial summary judgment and a permanent injunction, dismissed the individual defendants and the Law Firm from the action, dismissed the federal preemption claim against Lodi, and abstained from ruling on the state preemption claim. The district court dismissed the state preemption and remaining constitutional claims without prejudice.
Fireman’s Fund timely appeals the district court’s rulings concerning federal and state preemption, and the district court’s dismissal of the official capacity claims against the individual defendants.
II.
STANDARD OF REVIEW
We review de novo a district court’s decision to grant or deny a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Gonzalez v. Metropolitan Transp. Auth.,
Similarly, we review de novo whether this case meets the requirements of the Pullman abstention doctrine. Martinez v. Newport Beach City,
III.
ANALYSIS
On appeal, Fireman’s Fund asserts that the district court erred in abstaining from deciding whether MERLO is preempted by various state laws, and Fireman’s Fund and Unigard argue that MERLO is in fact preempted by state and federal law. We find that the district court erred in abstaining from deciding whether MERLO is preempted by state law. Because the state law preemption analysis resembles the federal preemption analysis, we consider whether MERLO is preempted by federal law in conjunction with the state law preemption question. We conclude by finding that although a few sections of MERLO are preempted by state and federal law under the doctrine of conflict preemption, the majority of the Insurers’ preemption arguments lack merit.
In addition, Fireman’s Fund appeals the district court’s decision dismissing its official capacity claims against three individual defendants. We agree with Fireman’s Fund and reinstate those claims.
A. ABSTENTION
Three factors must be present before a district court may abstain under the Pullman doctrine: “(1) the complaint must involve a ‘sensitive area of social policy’ that is best left to the states to address; (2) ‘a definitive ruling on the state issues by a state court could obviate the need for [federal] constitutional adjudication by the federal court’;
As to the first factor, we do not believe that “the complaint ... involve[s] a sensitive area of social policy that is best left to the states to address.” Cedar Shake and Shingle Bureau,
The third Pullman abstention factor is also lacking. As set forth above, this factor requires us to find that “the proper resolution of the potentially determinative state law issue is uncertain.” Cedar Shake and Shingle Bureau,
We find it fairly clear that MERLO as a whole is consistent with state law, and that municipalities in California may enact local ordinances that allow them to take an active role in remediating local hazardous waste contamination. See Section III. B.2.d. infra. Even if the state court were to find, as we do infra, that a few specific provisions of MERLO are preempted, such a finding would invalidate only those specific provisions. The bulk of MERLO would remain in effect, as would our obligation to consider Fireman’s Fund’s federal constitutional claims. Pullman abstention is therefore inappropriate.
Because there is no discretion to abstain in cases that do not meet the requirements of the abstention doctrine being invoked, Martinez,
Fireman’s Fund argues that MERLO is preempted by state law. In addition, both Fireman's Fund and Unigard argue that MERLO is preempted by federal law.
Under the Supremacy Clause of the United States Constitution, state laws that “interfere with, or are contrary to the laws of Congress” are preempted and are therefore invalid. Gibbons v. Ogden, 22 U.S. (9 Wheat) 1, 211,
California preemption doctrine is based on Article XI, section 7 of the California Constitution, which states that “[a] county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.” Cal. Const., art. XI, § 7 (emphasis added); Sherwin-Williams Co. v. City of Los Angeles,
1. Field Preemption
As the Insurers acknowledge, CERCLA contains three separate savings clauses to preserve the ability of states to regulate in the field of hazardous waste cleanup. First, CERCLA § 114(a) states that “[n]othing in this chapter shall be construed or interpreted as preempting any State from imposing any additional liability or requirements with respect to the release of hazardous substances within such State.” 42 U.S.C. § 9614(a). Second, CERCLA § 302(d) states that “[n]othing in this chapter shall affect or modify in any way the obligations or liabilities of any person under other Federal or State law, including common law, with respect to release of hazardous substances or other pollutants or contaminants.... ” 42 U.S.C. § 9652(d). And third, CERCLA § 310(h) states that “[t]his chapter does not affect or otherwise impair the rights of any person under Federal, State, or common law, except with respect to the timing of review as provided in section 9613(h),” a CERCLA provision that is not at issue in the present case. 42 U.S.C. § 9659(h). Based on these provisions, this court has held that “CERCLA does not completely occupy the field of environmental regulation.” ARCO Envtl. Remediation, LLC v. Dep’t of Health and Envtl. Quality,
Notwithstanding this precedent, the Insurers argue that MERLO is preempted by the combined impact of CERCLA and HSAA under the doctrine of field preemption. According to the Insurers, CERC-LA and HSAA, together, occupy the field because CERCLA explicitly authorizes states, but not municipalities, to impose additional requirements regarding the cleanup of hazardous substances. The Insurers’ argument is based on the premise that, by referring to states but not political subdivisions in the text of the statute, Congress intended CERCLA to leave room for supplemental state legislation but to prohibit supplemental municipal legislation.
This argument is contrary to the Supreme Court’s ruling in Wisconsin Public Intervenor v. Mortier,
The exclusion of political subdivisions cannot be inferred from the express authorization to the “State[s]” because political subdivisions are components of the very entity the statute empowers. Indeed, the more plausible reading of FI-FRA’s authorization to the States leaves the allocation of regulatory authority to the “absolute discretion” of the States themselves, including the option of leaving local regulation of pesticides in the hands of local authorities.
Id. at 608,
We find that Mortier’s reasoning regarding FIFRA is equally applicable to CERCLA. Like FIFRA, CERCLA anticipates that states will enact supplemental remedial environmental legislation. Moreover, like FIFRA, the CERCLA savings clauses refer only to “State[s],” while CERCLA specifically refers to both states and political subdivisions in other provisions. Compare 42 U.S.C. § 9614(a) (referring only to “State[s]”), with 42 U.S.C. § 9606(a) (referring to “a State or local government”).
Indeed, here California has exercised its discretion to permit municipalities to regulate hazardous waste remediation in some circumstances. The California Constitution provides Lodi and other cities with broad municipal authority to address local environmental nuisances, Cal. Const., Art. XI, § 7, and the California Legislature has adopted numerous laws authorizing political subdivisions to adopt ordinances for the protection of the environment. See, e.g., Cal. Gov’t Code § 38771 (West 2001) (providing cities with the authority to determine what constitutes a public nuisance); Cal. Gov’t Code § 38773 (West 2001) (granting cities the authority to provide for the abatement of public nuisances).
In addition, the text of HSAA contemplates the ability of cities to adopt parallel municipal environmental ordinances. HSAA defines an authorized release into the environment as including a release “which is authorized by statute, ordinance, or rule of any state, regional, or local agency or government. ” Cal. H & S Code § 25326 (emphasis added). HSAA’s savings clause provides that with certain exceptions not applicable here, HSAA does not “affect or modify in any way the obligations or liabilities of any person under any other provision of state or federal laws.” Cal. H & S Code § 25366 (emphasis added). Significantly, the phrase “state law” is used in § 25326 to include municipalities. See Cal. H & S Code § 25326 (“A ‘release authorized or permitted pursuant to state law’ means any release into the environment which is authorized by statute, ordinance, regulation, or rule of any state, regional, or local agency or government ... ”).
Finally, the text of CERCLA indicates that Congress anticipated remedial actions undertaken by local governments independent of CERCLA’s own provisions:
In addition to any other action taken by a State or local government, when the President determines that there may be an imminent and substantial endangerment to the public health or welfare or*943 the environment because of an actual or threatened release of a hazardous substance from a facility, he may require the Attorney General of the United States to secure such relief as may be necessary to abate such danger or threat [proceeding under the provisions of CERCLA]....
42 U.S.C. § 9606(a) (emphasis added).
In the absence of a strong indication to the contrary, we adhere to the presumption that Congress did not intend CERC-LA to “den[y] local communities throughout the Nation significant powers of self-protection.” Mortier,
2. Conflict Preemption
The Insurers next assert that CERCLA and HSAA preempt seven specific portions of MERLO under the doctrine of conflict preemption. We will find federal conflict preemption where “compliance with both the federal and state regulations is a physical impossibility,” or when the state law stands as “an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” California Fed. Sav. and Loan Ass’n v. Guerra,
The Insurers challenge the following seven sections of MERLO as preempted: (a) the MERLO section permitting Lodi to be compensated for damage to its natural resources; (b) MERLO’s general liability scheme, including the sections of MERLO that provide for the joint and several liability of PRPs, and the sections setting forth the contribution rights of PRPs; (c) MER-LO’s burden of proof for establishing a defense to liability; (d) the MERLO sections addressing the cleanup standard set forth in the NCP; (e) the MERLO sections defining “abatement action costs” to permit Lodi to recover attorney’s fees and interest; (f) the MERLO section authorizing Lodi to gather certain information from PRPs and their insurers; and (g) the MERLO section permitting Lodi to bring direct actions against insurers of PRPs.
(a) Natural Resource Damages
MERLO states that PRPs shall be liable for “[d]amages for injury to, destruction of, or loss of natural resources, including the reasonable costs of assessing such injury, destruction, or loss resulting from the environmental nuisance.” MERLO § 8.24.040(A)(9)(c) (emphasis added). The Insurers contend that this provision is preempted by state and federal law because “under CERCLA and ... HSAA, a State must designate a city as its authorized representative before a city may seek natural resource damages.” According to the Insurers, because Lodi has not been designated the “authorized representative” of the State of California, it cannot recover for damages to its natural resources. We disagree.
CERCLA provides states, federal agencies, and Indian Tribes with a federal
In the case of an injury to, destruction of, or loss of natural resources under [107(1)(4)(C) ] liability shall be to the United States Government and to any State for natural resources within the State or belonging to, managed by, controlled by or appertaining to such State.... The President, or the authorized representative of any State, shall act on behalf of the public as trustee of such natural resources to recover for such damages.
42 U.S.C. § 9607(f)(1). Similarly, under HSAA, the Governor of California or an “authorized representative” of the State may recover natural resources damages. Caí. H & S Code § 25352(c).
It is unnecessary for us to determine whether a municipality may recover under CERCLA for damage to its natural resources in the absence of being designated the authorized representative of a state.
Notwithstanding any authority under CERCLA or HSAA that Lodi may acquire by delegation, Lodi retains its independent authority to protect its proprietary interest in natural resources held in trust by the City. We have held that although municipalities may not “sue as parens patriae [to protect their natural resources] because their power is derivative [of the state and] not sovereign,” municipalities may “ ‘sue to vindicate such of their own proprietary interests as might be congruent with the interests of their inhabitants.’ ” Colorado River Indian Tribes v. Town of Parker,
Likewise, allowing the City to do so does not conflict with either state or federal
We therefore find that MERLO § 8.24.040(A)(9)(c) is not preempted by state or federal law.
(b) MERLO’s Liability Scheme
The Insurers next allege that the provisions of MERLO providing for recovery of cleanup costs from PRPs conflict with and are therefore preempted by CERCLA and HSAA. MERLO allows the City, once it has incurred cleanup costs, to impose joint and several liability on PRPs for the entire amount of its costs. See MERLO § 8.24.040. At the same time, MERLO fails to provide a mechanism whereby PRPs may impose on the City its fair share of costs incurred (whatever that fair share might be). Under the facts of this case, we agree that portions of this liability scheme are preempted if the district court finds that Lodi is a PRP.
Section 107 of CERCLA permits the government or a private party who has incurred response costs to bring suit against a PRP to recover those costs. See 42 U.S.C. § 9607. Applying federal common law principles, we have interpreted Section 107 as imposing joint and several liability on PRPs whenever the harm caused to a site is indivisible. Atchison, Topeka & Santa Fe Ry. Co. v. Brown & Bryant, Inc.,
Moreover, as originally enacted, CERC-LA did not provide PRPs with an express cause of action for contribution. See Centerior Serv. Co. v. Acme Scrap Iron & Metal Corp.,
In 1986, Congress amended CERCLA by passing the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), 42 U.S.C. §§ 9601-9675. Among other additions, SARA added CERCLA § 113(f), which explicitly recognizes a claim for contribution. Pinal Creek Group v. Newmont Mining Corp.,
Like CERCLA, HSAA explicitly authorizes any PRP that has incurred response
The Insurers first argue that MERLO conflicts with CERCLA and HSAA because “CERCLA and HSAA allow any PRP that has incurred response costs to seek contribution from any other PRP,” whereas under MERLO, Lodi cannot be sued for contribution.
This conflict preemption argument is rooted in the Insurers’ assumption that Lodi is a PRP. To date, however, Lodi has not been administratively adjudged a PRP by either the federal EPA or California’s DTSC. Nor has a court adjudged Lodi a PRP. While we decline to decide whether Lodi is a PRP on the record before us, we note that it is doubtful whether Lodi may be considered a PRP merely as a result of operating its municipal sewer system. See Lincoln Prop., Ltd. v. Higgins,
If the district court finds that Lodi is a PRP, MERLO is preempted to the extent that it protects Lodi from contribution claims by other PRP’s.
Next, the Insurers allege that MERLO conflicts with CERCLA because under MERLO § 8.24.040, Lodi may impose joint and several liability for the entire clean-up cost onto any one PRP, whereas CERCLA
Our circuit has held that a PRP may not bring a CERCLA § 107 cost recovery action, and instead may bring only a claim for contribution under CERCLA § 113(f). Pinal Creek)
Thus, if the district court determines that Lodi is a PRP, Lodi may not escape its share of responsibility by imposing all the costs of cleanup on others. Allowing it to do so would interfere with CERCLA’s PRP cost allocation scheme, and would implicate the same policy concerns relied upon by this court in Pinal Creek in rejecting a § 107 cost recovery action for PRPs. Id. For these reasons, we find that MER-LO is preempted to the extent that it legislatively insulates Lodi from bearing its share of responsibility by imposing joint and several liability on other PRPs.
On the other hand, if the district court finds that Lodi is not a PRP, MERLO’s liability scheme does not come into conflict with CERCLA because under CERCLA, a non-PRP may impose joint and several liability on whatever PRPs it can locate. Therefore, if Lodi proves not to be a PRP it may invoke MERLO’s liability scheme without coming into conflict with CERC-LA.
(c) MERLO’s Burden of Proof for PRPs for Establishing a Defense to Liability
MERLO requires a defendant PRP seeking to apportion its liability to demonstrate by clear and convincing evidence that the harm is divisible, see MERLO § 8.24.040(E), whereas CERCLA and HSAA require a PRP to demonstrate only by a preponderance of the evidence that the harm is divisible. See 42 U.S.C. § 9607(b) and Cal. H & S Code § 25363(a). In other words, in order to avoid liability for the entire cleanup, under MERLO a defendant must prove by clear and convincing evidence its proportional responsibility for the hazardous wastes being cleaned.
For the same reasons that Lodi cannot legislatively insulate itself from contribution liability as a PRP under CERCLA, it cannot foist its share of liability onto others by imposing on fellow PRPs a higher burden of proof for apportionment.
Even if the district court finds that Lodi is not a PRP, this particular provision of MERLO conflicts with CERCLA and is preempted because it stands as “an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” California Fed. Sav.,
Potential purchasers of abandoned or underutilized contaminated properties are often deterred from purchasing and cleaning up these properties by exposure to unbounded and uncertain liability.
Moreover, environmental insurance, which was driven from the market by CERCLA’s joint and several and retroactive provisions, has recently become available again because evolving case law and more recent state and federal legislation have restored a degree of certainty to exposure to environmental risk. See, e.g., California Center For Land Recycling, Creating Vibrant Communities: Redeveloping California’s Brownfields § 5 (2002); see also, Marialuisa S. Gallozzi & Alice V. Stevens, Introduction To Environmental Risk Policies, SG006 ALI-ABA 549 (2002). The availability of environmental insurance may allow early settlement, even among large groups of PRP’s, thus allowing energy and resources to be directed at site cleanup rather than protracted litigation. Creating Vibrant Communities § 5.
To allow literally thousands of different local governments to impose their own liability schemes (such as Lodi’s) that make it more difficult to apportion liability than
On the other hand, municipal liability schemes equal to or less onerous than that imposed by CERCLA do not foster uncertainty or discourage cleanup but could, in many instances, make rehabilitation of contaminated property more feasible, thus furthering the objective of Congress.
We hold therefore that MERLO’s requirement that a defendant PRP seeking to apportion its liability must demonstrate by clear and convincing evidence that the harm is divisible is in conflict with CERC-LA and is preempted. We reach this conclusion regardless of what determination the district court ultimately makes on the question of whether Lodi is, or is not, a PRP.
(d) The National Contingency Plan (“NCP”) Standard
The Insurers next argue that the portions of MERLO dealing with the cleanup standard set forth in the National Contingency Plan (“NCP”) conflict with CERCLA § 107(a)(4)(B) and PISAA § 25356, both of which address the NCP. See MERLO §§ 8.24.030-040.
Under CERCLA, the cleanup of listed hazardous waste sites must be consistent with the NCP, which is a plan promulgated by the EPA that “specifies the roles” of the federal, state, and local governments “in responding to hazardous waste sites, and establishes the procedures for making cleanup decisions.” United States v. City of Denver,
HSAA incorporates the NCP standard by reference. Under HSAA, “[a]ny response action taken or approved pursuant to this chapter shall be based upon, and be no less stringent than ... [t]he requirements established under federal regulation pursuant to [the NCP].” Cal. H & S Code § 25356.1.5(a)(1).
The Insurers argue that the provisions of MERLO addressing the NCP are preempted for two reasons. First, the Insurers argue that MERLO conflicts with
We have previously distinguished between local governmental units, such as municipalities, and “States” as defined by CERCLA, 42 U.S.C. § 9607(a)(4)(A). See Wash. State Dept, of Transp.,
Contrary to the Insurers’ contentions, this presumption of consistency would not allow Lodi to escape any responsibility it should rightly bear if the district court finds that Lodi is a PRP. Rather, it encourages a more expeditious cleanup by affording Lodi, “acting in close cooperation, coordination and communication with DTSC,” the presumption that the cost of selected cleanup mechanisms are recoverable from other PRPs to the extent that
Next, the Insurers argue that MERLO is preempted to the extent that it permits Lodi to order remediation that is either more or less stringent than the NCP. Specifically, under MERLO Lodi may order additional or more stringent requirements than those that would or might apply under the NCP. Similarly, MERLO § 8.24.030(A)(6) states that the City “may order less stringent requirements ” for abatement than those that would or might apply under the NCP. See MERLO § 8.24.030(A)(5) (emphasis added). Finally, MERLO states that “at any site within the city which is [a listed site under HSAA], the enforcing officer must, at a minimum, comply with [HSAA].” MERLO § 8.24.030(A)(7).
To the extent that MERLO § 8.24.030(A)(5) permits Lodi to order abatement that is more stringent than the NCP, we find that it is preempted for the same reasons that MERLO’s burden of proof is preempted.
As to the claim that MERLO allows abatement less stringent than the NCP, MERLO in fact does not permit Lodi to order abatement less stringent than the NCP with respect to the Lodi Groundwater Site. DTSC listed the Lodi Groundwater Site beginning in fiscal year 1993-94. MERLO requires that listed sites comply with HSAA, which in turn requires that response actions be based upon and be no less stringent than the NCP.
With respect to application of MERLO beyond the Lodi Groundwater Site, we see no reason why California cities may not enact municipal environmental response ordinances keying cleanup to standards other than the NCP. Cleanups conducted pursuant to CERCLA and HSAA require use of the NCP. However, we have held that CERCLA and HSAA do not preempt the field of hazardous waste cleanup. So long as a local ordinance does not come into conflict with CERCLA or HSAA, as we have explained MERLO would in some instances, a city may borrow or adapt the NCP as it sees fit — or use some other procedure for making cleanup decisions. An agreement with or authorization from the state is not a prerequisite to local environmental legislation.
(e) Recovery of Attorney’s Fees and Other “Abatement Action Costs”
Under MERLO, Lodi may recover from any PRP “[a]ll abatement action
In Key Tronic Corp. v. United States,
We need not decide if a city is the “State” for purposes of recovering its attorney fees under CERCLA, because, in any case, a city that is also a PRP should not be able to avail itself of this advantage. If the district court finds that Lodi is indeed a PRP, it may not legislate for itself a litigation advantage by granting itself the right to collect attorney’s fees. If, on the other hand, Lodi proves not to be a PRP, we see no reason why Lodi may not provide for recovery of attorney’s fees for itself under its municipal liability scheme. Of course, the amount and nature of attorney’s fees recoverable is always subject to the reasonableness standard as applied in the discretion of the district court.
We have held above that Lodi is entitled to the presumption of consistency bestowed on States by the phrase “not inconsistent with the national contingency plan” contained in CERCLA, 42 U.S.C. § 9607(a)(4)(A), by virtue of the Cooperative Agreement with the DTSC. A similar result, however, is not called for with respect to attorney’s fees. The ability of states to recover attorney’s fees under CERCLA flows from language providing that responsible parties shall be liable to states for “all costs of removal or remedial action.” 42 U.S.C. § 9607(a)(4)(A). Attorney’s fees recoverable by states are included in the definition of “all costs.” Chapman,
Lodi has expended significant attorney’s fees in an attempt to escape liability through the enactment and defense of its municipal ordinance. These efforts, so far as we can tell, have not advanced the cleanup of the Lodi Site. Litigation costs may indeed be a part of recovering funds that are needed to advance the cleanup. However, the ability to recover litigation-related attorney’s fees does not necessarily advance the pace of cleanup because it may encourage ambitious litigation. We do not interpret the Cooperative Agreement to allow Lodi to recover its attorney’s fees, nor do we necessarily believe that it could bestow on Lodi the right to
Lodi also seeks to recover costs related to a financing scheme upon which it has embarked in order to avoid municipal finance mechanisms that would make Lodi’s ratepayers responsible (at least initially) for principal and interest costs. The Insurers assert that Lodi is trying to pass on, as costs of financing the cleanup, interest costs of 25 to 30 percent. We decline to pass judgment on these costs on the record before us, and leave it to the district court to determine if these costs are recoverable under the standard of “necessary costs of response” if Lodi should prove to be a PRP. If Lodi should prove not to be a PRP, we leave it to the district court to determine, under the standards the district court determines to be appropriate, whether these costs are recoverable.
(f) Information Gathering Authority
The Insurers next argue that MERLO’s information gathering provision conflicts with both CERCLA and HSAA. Section 8.24.050 authorizes Lodi to compel the production of any documents, information, and testimony:
... for the purposes of investigating the nature or source of ... an environmental nuisance, or for the purposes of determining the need for abatement actions, choosing or taking an abatement action under this chapter, or for the purposes of determining the nature and extent of the assets and financial resources that are or may be available to (or available to provide indemnity or similar benefits to) any potentially responsible parties to undertake abatement actions which are or may be required pursuant to this chapter or to reimburse the comprehensive municipal environmental response fund for any abatement action costs incurred or to be incurred by the city pursuant to this chapter.
MERLO § 8.24.050(A). The Insurers assert that by this section, Lodi has improperly “arrogated to itself’ information-gathering powers that only the EPA can provide under CERCLA § 104(e), and only DTSC can provide under HSAA § 25358.1(a).
Notwithstanding any authority that Lodi may acquire by delegation, Lodi has independent authority to promulgate information-gathering legislation pursuant to its traditional police powers. These powers include the City’s authority to gather the information reasonably necessary to discharge its duty to protect the public health and welfare from public nuisances. See Cal. Gov’t Code § 38773.5 (a municipality’s legislative body may by Ordinance establish a procedure for the abatement of a nuisance). In addition, California Government Code § 37104 specifically authorizes city councils to issue legislative subpoenas. Lodi’s authority to issue legislative subpoenas under MERLO and pursuant to California Government Code § 37104 was recently reaffirmed by the California Supreme Court. See Conn. Indem. Co. v. Super. Ct.,
Moreover, Lodi’s decision to exercise its independent information-gathering authority by enacting MERLO does not conflict with either state or federal law. Compliance with an information-gathering request under MERLO would not make compliance with such a request under CERCLA or HSAA impossible. See Indus. Truck Ass’n,
For these reasons, we find that MER-LO’s information-gathering provisions are not preempted by either CERCLA or HSAA.
(g) Direct Actions Against Insurers
Under MERLO § 8.24.090(B)(1), Lodi may initiate a direct action against a PRP’s insurer before the City has obtained a final order or judgment against the insured PRP. The Insurers allege that this portion of MERLO is preempted because it conflicts with CERCLA § 108(c) and California Insurance Code § 11580. Because we find that MERLO § 8.24.090(B)(1) conflicts with California insurance law and is therefore preempted on this basis, we need not consider whether it also conflicts with CERCLA.
California Insurance Code § 11580 states that every liability insurance policy issued in California must include “[a] provision that whenever judgment is secured against the insured ... in an action based upon bodily injury, death, or property damage, then an action may be brought against the insurer on the policy and subject to its terms and limitations, by such judgment creditor to recover on the judgment.” Cal. Ins.Code § 11580(b)(2) (West 2001) (emphasis added). Fireman’s Fund asserts that this statute “forbids direct actions against an insurer absent a final judgment against the insured.” Fireman’s Fund further asserts that because MER-LO § 8.24.090(B)(1) authorizes direct actions against the insurers of PRPs prior to obtaining a final judgment against the insured, but § 11580 forbids such actions, MERLO § 8.24.090(B)(1) conflicts with and is therefore preempted by California law. Sports Comm. Dist.,
We begin our conflict preemption analysis with the plain language of the statute. See Moyer v. Workmen’s Compl. Appeals Bd.,
Two California Court of Appeals cases support the conclusion that § 11580 does not set forth the exclusive set of circumstances under which one may initiate a direct action against an insurer. See Roberts v. Home Ins. Indem. Co.,
However, there is greater authority to suggest that § 11580 sets forth the exclu
We find these latter cases (including our own Ninth Circuit decision) persuasive and hold that MERLO § 8.24.090(B)(1) is preempted by California Insurance Code § 11580 to the extent that it expands the ability of Lodi to bring direct actions against a PRP’s insurer before entry of a final judgment against the insured.
3. Duplication
California courts have largely confined the duplication prong of the state preemption test to penal ordinances. Baldwin v. County of Tehama,
4. Summary of Preemption Analysis
In sum, we hold that CERCLA and HSAA do not preempt the field of hazardous waste remediation, either explicitly or by implication. CERCLA permits both states and their political subdivisions to enact hazardous waste regulations and pursue additional remedies, as long as those remedies do not conflict or interfere with “the accomplishment and execution of [CERCLA’s] full purpose and objective.” Indus. Truck Ass’n,
We conclude, however, that two provisions of MERLO — regarding the burden of proof for PRPs for establishing a defense to liability and that allow Lodi to require abatement procedures more stringent than the NCP — are preempted under the doctrine of conflict preemption. We further find that the sections of MERLO allowing Lodi to impose joint and several liability on other PRPs and to recover attorneys’ fees may be preempted under the doctrine of conflict preemption if the district court finds that Lodi is a PRP. To
C. OFFICIAL CAPACITY CLAIM
Fireman’s Fund also appeals the district court’s decision dismissing its claims brought against three individual defendants in their “official capacities”: Lodi City Attorney Randall A. Hays, Enforcement Officer Richard C. Prima. Jr., and Enforcement Officer Fran E. Forkas.
The district court dismissed these claims as duplicative of Fireman’s Fund’s claims against Lodi. Fireman’s Fund asserts that the district court erred in so doing because the above-named municipal officers “are classic Ex[P]arte Young defendants” and the official capacity claims are necessary to “effectively foreclose any assertion by Lodi of Eleventh Amendment Immunity.”
IY.
CONCLUSION
In sum, we hold that the district court erred in abstaining from reaching Fireman’s Fund’s state law preemption claim. On the merits of the Insurers’ state and federal preemption claims, we hold that CERCLA and HSAA do not preempt the field of hazardous waste remediation, either explicitly or by implication. We further hold that MERLO is not preempted by the state law doctrine of preemption by duplication.
We conclude, however, that several sections of MERLO are preempted by state and federal law under the doctrine of conflict preemption under the circumstances we have outlined above. We conclude that the balance of MERLO remains viable and is not preempted by either state or federal law. Finally, we reinstate Fireman’s Fund’s official capacity claims against Hays, Prima, and Forkas.
Notes
. Pursuant lo a sunset clause, the original Carpenter-Presley-Tanner Hazardous Substance Account Act, also known as the California Superfund, became inoperative on January 1, 1999. HSAA, Cal. H & S Code § 25395. The reenacted HSAA went into effect on May 26, 1999, without a sunset clause. Actions and agreements pursuant to the previous version of HSAA are governed by the reenacted law. See 1999 Ch. 23 § 3.
. See Central Valley Regional Water Quality Control Board, “Dry Cleaners — A Major Source of PCE in Ground Water,” pp. 20-21, March 27, 1992.
. See Cal. H & S Code §§ 25355-6 (describing California's listing procedures).
. The federal Environmental Protection Agency (“EPA”) has never employed federal resources to initiate a comparable administrative proceeding at the federal level. The EPA has also never listed the Lodi Groundwater Site on the National Priorities List ("NPL”), a list of those sites that the EPA has determined are most in need of remediation. See 42 U.S.C. § 9605(a)(8)(B) (2001). Only NPL listed sites are eligible to receive federal Superfund dollars. See 40 C.F.R. § 300.425(b)(1).
. DTSC had the authority to enter into the Cooperation Agreement under HSAA. As the Agreement itself states, DTSC entered into the Agreement “pursuant to its authority as set forth in Chapters 6.5 and 6.8 of the California Health and Safety Code [the HSAA], as well as its inherent governmental authority to resolve claims within its jurisdiction.” See also Cal. H & S Code § 25355.5(a)(1)(C) (authorizing DTSC to enter into "agreements” with PRPs or "other parties”); Cal. H & S Code § 25358.3.
.Under CERCLA, the cleanup of listed hazardous waste sites must be consistent with the National Contingency Plan ("NCP”) — a plan promulgated by the EPA that "specifies the roles” of the federal, -state, and local governments “in responding to hazardous waste sites, and establishes the procedures for making cleanup decisions.” United States v. City of Denver,
. On November 17, 1999, Lodi’s City Council repealed Ordinance 1650 and reenacted an amended version of MERLO as Ordinance No. 1684. The amended version of MERLO became effective on December 17, 1999. Because we apply the law in effect at the time of decision, we must decide the issues raised in these related appeals based on the current version of MERLO. See Bradley v. Richmond Sch. Bd.,
Furthermore, the reenacted MERLO specifically provides that any action taken under the original MERLO "shall remain in effect” under the reenacted version of the Ordinance. The reenacted MERLO also provides that any changes made to the Ordinance as a result of the amendments apply retroactively to all proceedings initiated under the original MERLO. Finally, the general "savings clause” in Lodi Municipal Code § 1.01.080, which was enacted in 1985 well before Lodi adopted either version of MERLO, further establishes the continuing viability of any remedial enforcement actions initiated by Lodi before it repealed and reenacted MERLO.
. Additional individual defendants Steven H. Doto, John R. Till, Bret A. Stone, and Adam L. Babich were dismissed without prejudice
. We note that the district court did an admirable job in sorting through the varied and difficult issues raised in this highly complex case.
. The Pullman abstention doctrine derives its name from the case of Railroad Commission of Texas v. Pullman Co.,
. We have held that Pullman abstention is not appropriate when the federal question at stake is one of federal preemption because preemption is not considered a "constitutional issue.” Hotel Employees and Rest. Employees Int'l Union v. Nevada Gaming Comm’n,
. Both Fireman's Fund and Lodi agree that the even if the district court did not err in abstaining, it erred in dismissing the Fireman's Fund's remaining .federal and state constitutional claims; the district court instead should have stayed the action and retained jurisdiction over the remaining federal claims pending resolution of the relevant state law issues in state court. See International Bhd. of Elec. Workers,
. Several district courts in other circuits have addressed this question, however. In the walte of the 1996 SARA amendments to CERCLA, these district courts have uniformly held that a municipality may not bring a CERCLA cause of action "as a public trustee” of a state's natural resources unless the municipality has been appointed by the governor of its respective state. See, e.g., Borough of Sayreville v. Union Carbide Corp.,
. We note that our holding is not inconsistent with the reasoning of other circuits that have held that litigants may not invoke state statutes in order to escape the application of CERCLA’s provisions in the midst of hazardous waste litigation. See, e.g., PMC, Inc. v. Sherwin-Williams Co.,
. In so holding, however, we do not consider whether Lodi may be entitled to contribution protection as a result of the Cooperative Agreement between Lodi and California’s DTSC.
. We note that MERLO's application is not limited to contaminated drinking water. It sweeps broadly, encompassing all types of environmental contamination that may result from the releases at issue here, and encompassing virtually all other instances of environmental contamination affecting Lodi or its environs. MERLO § 8.24.010(7).
. It is important to remember that in many instances there is no solvent responsible party available to pay for site cleanup, and no insurance funds to be tapped. Such sites are often located in inner city neighborhoods, and overly ambitious liability requirements disproportionately discourage economic development in areas that need it most. See California Center For Land Recycling, Strategies For Promoting Brownfield Reuse In California (1998).
. In fact, the original version of MERLO— Ordinance 1650 — specifically stated that Lodi may recover all costs "not inconsistent with the NCP.” The Insurers allege that Lodi specifically amended MERLO so that the revised version of the ordinance — Ordinance 1684— omits any reference to the NCP and instead permits the City to recover all costs "not inconsistent with the requirements of this chapter.” According to the Insurers, this amendment "masks rather than eliminates the problem.”
. However, local governments are entitled to the presumption of consistency when performing cleanups pursuant to one of several California code sections. For example, the Polanco Redevelopment Act provides that municipal redevelopment corporations performing cleanups under the provisions of the Act are afforded the presumption of consistency. As the district court in City of Emeryville v. Elementis Pigments, Inc.,
.As contract interpretation is a matter of law, we interpret the Cooperative Agreement to require DTSC to act with Lodi in a consolidated effort, providing the oversight, consultation, and cooperation necessary and appropriate to ensure that the Lodi Groundwater Site is remediated in a timely, competent, and cost-effective manner. In exchange for its ongoing and substantial services, DTSC will receive the consideration enumerated in the Cooperative Agreement.
. MERLO § 8.24.030(A)(7) keys response actions to Cal. H & S § 25356(c), which states that actions carried out with regard to listed sites shall comply "with the procedures, standards, and other requirements set forth in this chapter," which include adherence to the NCP. Cal. H & S § 25356(c) has been subsequently renumbered as § 25356(d).
. The Cooperative Agreement also provides that the Work on the Lodi Groundwater Site comply with the NCP.
.We should note, however, that in some instances California law provides important advantages to municipalities that pursue hazardous waste cleanup under authority delegated by the state with oversight from a state agency. See, e.g., Cal. H & S § 25401 et seq. and § 57008 et seq. (the California Land Environmental Restoration and Reuse Act) (providing statutory immunity for local governments, owners and occupants, and lenders who conduct site cleanup pursuant to the terms of the Act).
. We are aware of an out-of-circuit case indicating that local regulations less stringent than CERCLA are preempted. However, the statement in United States v. Akzo Coatings of America, Inc.,
. Lodi argues that MERLO’s provisions allowing it to order abatement procedures more stringent than the NCP can not be preempted by CERCLA because of CERCLA's multiple savings clauses. Lodi's argument does not recognize the difference between field preemption and conflict preemption. We have indeed held that CERCLA’s savings clauses make it clear that CERCLA does not preempt the field of hazardous waste cleanup. See Section 111(B)(1) supra. As this opinion makes clear, municipalities such as Lodi may exercise significant powers of self-protection in regulating hazardous waste cleanup. However, the powers of municipalities are not unlimited. Where municipal legislation comes into conflict with CERCLA, we find the municipal legislation to be preempted, just as other circuits have found conflict preemption in other circumstances, notwithstanding the same savings clauses cited by Lodi. See, e.g., Bedford Affiliates,
Second, Lodi cites to sections of the NCP mentioning more stringent State requirements. We have rejected the Insurers’ argument that by referring to States but not political subdivisions in the text of CERCLA, Congress intended to leave room for supplemental State legislation but to prohibit all supplemental municipal legislation. However, this does not mean that Lodi can assume the mantle of the "State” or the breadth of the State's powers in all circumstances. We have previously distinguished between local governmental units, such as municipalities, and "States” with regard to various applications of CERCLA. See Wash. State Dept. of Transp.,
. Fireman’s Fund does not appeal the district court's dismissal of Fireman's Fund’s official capacity claims against Michael C. Donovan and the Law Firm of Zevnik, Horton, Guibord & McGovern, L.L.P.
. "The Eleventh Amendment bars suits which seek either damages or injunctive relief against a state, an 'arm of the state,' its in-strumentalities, or its agencies.” Franceschi v. Schwartz,
.Lodi asserts that the official capacity claims against these three municipal officers were also dismissed by the district court on qualified immunity grounds. On the contrary, the district court dismissed the official capacity claims as duplicative of the claims against the City, and dismissed the "remaining individual capacity claims " on qualified immunity grounds. Fireman’s Fund,
. Fireman's Fund and Unigard argue that Lodi is a PRP as a matter of law as a result of its agreement with the DTSC. This issue has not been fully briefed on appeal and we leave it to the district court to consider this argument in the first instance.