MALLINCKRODT US LLC et al. v. DEPARTMENT OF ENVIRONMENTAL PROTECTION.
Docket No. BCD-13-121.
Supreme Judicial Court of Maine.
Decided: April 3, 2014.
2014 ME 52
Argued: Feb. 11, 2014.
Janet T. Mills, Attorney General, and Peter B. LaFond, Asst. Atty. Gen. (orally), Office of Attorney General, Augusta, on the briefs, for appellee Department of Environmental Protection.
Eric M. Mehnert, Esq. (orally), and Cynthia M. Mehnert, Esq., Hawkes & Mehnert, LLP, Bangor, on the briefs, for appellee Maine People‘s Alliance.
Panel: SAUFLEY, C.J., and ALEXANDER, LEVY, MEAD, GORMAN, and JABAR, JJ.
MEAD, J.
[¶ 1] Mallinckrodt US LLC and United States Surgical Corporation1 (collectively, “Mallinckrodt“) appeal from a judgment entered in the Business and Consumer Docket (Nivison, J.) affirming a decision of the Board of Environmental Protection, which modified and affirmed a compliance order issued by the Commissioner of the Department of Environmental Protection. The Commissioner‘s order required Mallinckrodt to excavate material containing mercury and other contaminants from five landfills located on a site adjacent to the Penobscot River in Orrington, and to transfer the material to off-site landfills. The Board‘s decision modified the Commissioner‘s order, requiring that Mallinckrodt excavate only two of the landfills and that it secure and monitor the others. We affirm the judgment.
I. BACKGROUND
[¶ 2] Mallinckrodt is the only viable remaining entity to take responsibility for the site of the former HoltraChem chemical plant on the banks of the Penobscot River in Orrington.2 One of Mallinckrodt‘s corporate predecessors constructed the plant on a 235-acre site adjacent to the river in 1967. The plant used a mercury-cell process to produce chlorine and other chemical products used primarily in Maine‘s paper industry. Byproducts of this process, including thousands of tons of mercury-contaminated brine-sludge and other hazardous waste, remain stored in five landfills located on the site. Approximately seventy-seven acres of the site are contaminated by various hazardous substances including mercury, chloropicrin, carbon tetrachloride, and tetracholoroethene. Hazardous substances from the site have been discharged both into the Penobscot River and into the air.
[¶ 3] The United States Environmental Protection Agency (EPA) first became involved in managing the site in 1986 when it entered into an administrative agreement with the site‘s owners to investigate conditions at the site. HoltraChem Manufacturing Company, LLC, acquired the plant in 1994. Mallinckrodt and HoltraChem cooperated with the EPA and the Maine Department of Environmental Protection
[¶ 4] The plant ceased operations in 2000. Since HoltraChem‘s dissolution in 2001, the EPA and the Department have dealt exclusively with Mallinckrodt on issues related to the site, including the development of possible alternatives for remediating the site. The Town of Orrington became the owner of the site by virtue of a tax lien certificate filed in 2002 and subsequent foreclosure in 2003.
[¶ 5] Mallinckrodt worked cooperatively with the EPA and the Department for several years. During that time, the Department developed and considered four options for remediating the site: Option 1 would require moving and consolidating the contents of one of the landfills into an on-site unit without a liner; Option 2 would require moving and consolidating all five landfills into an on-site unit without a liner; Option 3 would require moving and consolidating all five landfills into an on-site unit with a liner; and Option 4, which was referred to as the “dig-and-haul” remedy, would require excavating all five landfills and shipping their contents offsite. Option 1 was attractive because it would result in the least amount of air emissions but would achieve environmental-protection results comparable to those provided by the other options. Option 1 would take the least amount of time, result in fewer transportation issues, and, at an estimated cost of $46 million, be the least expensive of the four options. In contrast, Option 4, the “dig-and-haul” remedy, was the most expensive, with estimated costs exceeding $200 million. It would also result in the highest level of mercury air emissions.
[¶ 6] During the summer of 2004, the Maine People‘s Alliance3 (MPA), which had been monitoring the Department‘s efforts to ensure that the site was cleaned up, prepared to launch a media campaign to attack the delay in the cleanup of the site. It sought Governor John Baldacci‘s cooperation in its efforts. In September 2004, the MPA and the Governor issued a joint press release calling for the accelerated cleanup of the site.
[¶ 7] Department staff concluded that Option 3 would be the most cost-effective and the most protective of public health. They recommended this option to the Governor, but the Governor strongly preferred the “dig-and-haul” remedy. In September 2005, the Governor and the Commissioner of the Department held a press conference announcing that the “dig-and-haul” remedy would be undertaken.
[¶ 8] Between 2005 and 2008, Mallinckrodt continued to monitor groundwater at the site, operate and maintain a wastewater treatment system, and dismantle and remove infrastructure and mercury-contaminated debris; however, it did not excavate the landfills. In November 2008, the Commissioner issued an order pursuant to Maine‘s Uncontrolled Hazardous Substance Sites Law (the UHSSL),
[¶ 10] The Board retained an outside consultant to assist in its consideration of technical evidence because the Commissioner, being a party to the proceeding, was unable to serve in an advisory capacity. A Department staff member was tasked with performing a similar consulting function. The consultants’ role was to summarize technical information presented by the parties, identify inconsistencies in the data, suggest questions to be asked of witnesses, and ask questions of witnesses at the direction of the presiding officer. The consultants would not offer testimony, and the Board ruled that, consequently, they would not be subject to cross-examination.
[¶ 11] The Board conducted a de novo evidentiary hearing over nine days in January and February 2010. In accordance with the Board‘s procedural orders, each party prefiled its witnesses’ direct and rebuttal testimony. Over Mallinckrodt‘s objection, witnesses testified in panels grouped according to the subject matter of their testimony. During the Board‘s deliberations, the outside consultant provided charts and summaries of evidence that had been admitted during the hearing. Similarly, the Department staff member who had been designated to act as a consultant offered opinions and provided documents summarizing and explaining the evidence relating to air emissions.
[¶ 12] In August 2010, the Board issued an order affirming and partially modifying the Commissioner‘s order. As modified, the order required Mallinckrodt to excavate and transport materials from two of the landfills, cap the remaining landfills, develop and implement plans for extracting and testing groundwater, and continue to monitor conditions at the site. Mallinckrodt estimates that the cost of complying with the order will be approximately $130 million.
[¶ 13] Mallinckrodt appealed, and the case was accepted for transfer to the Business and Consumer Docket, where Mallinckrodt also asserted an independent claim pursuant to
II. DISCUSSION
A. The Commissioner‘s Authority to Issue a Compliance Order
[¶ 14] Mallinckrodt argues that the Commissioner lacked statutory authority to issue a compliance order pursuant to the UHSSL because the plain language of the relevant provision must be read to authorize the Commissioner to take such action only in the event of an emergency. Mallinckrodt contends that if the Department wished to require remediation at the site, the appropriate remedy would have been for the Attorney General to file an action in Superior Court.
[¶ 15]
Upon finding, after investigation, that a location at which hazardous substances are or were handled or otherwise came to be located may create a danger to the public health, to the safety of any person or to the environment, the commissioner may:
A. Designate that location as an uncontrolled hazardous substance site;
B. Order any responsible party7 dealing with the hazardous substances to cease immediately or to prevent that activity and to take an action necessary to terminate or mitigate the danger or likelihood of danger; and
C. Order any person contributing to the danger or likelihood of danger to cease or prevent that contribution.
[¶ 16] The responsible party must “immediately” comply with an order issued pursuant to section 1365.
[¶ 17] When the Business and Consumer Docket sits as an intermediate appellate court to review an agency decision pursuant to M.R. Civ. P. 80C, we
[¶ 18] Contrary to Mallinckrodt‘s argument, the plain language of
[¶ 19] Second, Mallinckrodt‘s argument that the Legislature‘s use of the word “danger” indicates only immediate emergencies is undercut by a plain reading of the entire provision.9 The Commissioner is empowered to make an order when a location containing hazardous substances “may create a danger.”
[¶ 20] Finally, Mallinckrodt argues that, because the remedy that the Commissioner ordered was a “cleanup,” the Commissioner was only authorized to proceed in Superior Court pursuant to
[¶ 21] However, “[w]e also construe the whole statutory scheme of which the section at issue forms a part so that a harmonious result, presumably the intent of the Legislature, may be achieved.” Id. (quotation marks omitted). Here, it is possible to construe these provisions harmoniously. Whereas
B. The Administrative Procedure Act
[¶ 22] Mallinckrodt argues that the Board was required to adopt rules of practice governing UHSSL hearings and that its failure to do so rendered the Board‘s final order legally ineffectual. The Department argues that Maine‘s Administrative Procedure Act (APA),
[¶ 23] The APA provides, in relevant part: “[E]ach agency shall adopt rules of practice governing the conduct of adjudicatory proceedings . . . except to the extent that such rules are provided by law.”
the whole or any part of every regulation, standard, code, statement of policy, or other agency guideline or statement of general applicability, including the amendment, suspension or repeal of any prior rule, that is or is intended to be judicially enforceable and implements, interprets[,] or makes specific the law administered by the agency, or describes the procedures or practices of the agency. . . .
[¶ 24] The Department‘s governing statute declares that all of its hearings “must be conducted in accordance with the procedural requirements of the Maine Administrative Procedure Act, Title 5, chapter 375.”
[¶ 25] Mallinckrodt urges us to conclude that this case is comparable to New England Whitewater Center, Inc. v. Department of Inland Fisheries and Wildlife, 550 A.2d 56 (Me.1988), in which we observed that an agency‘s “failure . . . to comply with the rulemaking provisions of the [APA] is a procedural defect that we cannot overlook even should we conclude there is no showing of preju-
[¶ 26] “An agency must comply with the APA before it adopts a rule; otherwise the rule has no legal effect.” Roderick v. State, 2013 ME 34, ¶ 9, 79 A.3d 368;
C. Cross-Examination of Board Consultants
[¶ 27] Mallinckrodt contends that the two consultants who assisted the Board in evaluating technical evidence served in effect as expert witnesses and that the advice they offered should have been subject to cross-examination. Before the de novo hearing, the Board issued a procedural order explaining:
The consultant will assist Board staff (Executive Analyst) with summarizing technical information presented by the parties, identifying data/information gaps and inconsistencies that should be explored, formulating suggested questions to be asked of witnesses at the hearing, and asking questions of witnesses at the Presiding Officer‘s discretion. The consultant will not be conducting independent studies of the site, but rather assisting the Board in its review of the evidence presented by the parties. The consultant will not offer testimony and will not be subject to cross-examination. Documents produced by the consultant will be available to the parties and included in the record.
[¶ 28] Pursuant to the APA, “every party shall have the right . . . to make oral cross-examination of any person present and testifying.”
[¶ 29] Mallinckrodt characterizes the consultants as expert witnesses. We note that Mallinckrodt did not object to the consultants’ involvement in the Board‘s decision-making.11 Thus, we review only for obvious error affecting substantial rights. See Town of China v. Althenn, 2013 ME 107, ¶ 12, 82 A.3d 835. We conclude that the Board committed no error by precluding Mallinckrodt from cross-examining the consultants because the consultants did not offer testimony. See Reilly v. United States, 863 F.2d 149, 159 (1st Cir.1988) (“If . . . the advisor was not an evidentiary source, there was neither a right to [cross-examine] him . . . nor a purpose in doing so.“); Thomas v. Me. State Ret. Sys., No. AP-07-27, 2008 WL 4106400 (Me.Super. Apr. 8, 2008) (concluding that a memorandum “provided in [an] advisory capacity . . . is not . . . testimony.” (quotation marks omitted)). Although the Board‘s consultants spoke on the record, they did so only during deliberations. The documents they provided to the Board contained summaries of evidence that had already been admitted, and the opinions they offered were based on information provided by the parties. Because the consultants did not serve in an advocate capacity, the Board was entitled to rely on their advice,
D. Evidence of Political Bias
[¶ 30] Finally, Mallinckrodt contends that the Board abused its discretion by excluding evidence that the Commissioner‘s original order was tainted by political bias. The Board‘s fifth procedural order held that “any political pressure exerted in the Commissioner‘s process is not relevant to the Board‘s [decision-making] process,” but provided that “the parties retain the right as part of any cross-examination to ask questions that relate to the credibility of the witness and therefore the reliability of the testimony offered by that specific witness for inclusion in the Board‘s record.”
[¶ 31] Pursuant to the APA, “every party shall have the right to present evidence and arguments on all issues. . . .”
[¶ 32] In the appeal of the Commissioner‘s order, the Commissioner must “first establish the basis for the order and for naming the person to whom the order is directed.”
[¶ 33] Additionally, we note that the Board was not entirely dismissive of Mallinckrodt‘s concerns. The Board‘s procedural order concerning this issue specifically provided that Mallinckrodt would retain the right to cross-examine witnesses about whether bias affected their testimony. This approach was appropriate given that the Board was assessing only the scientific justification for the remedy the Commissioner ordered. Notwithstanding Mallinckrodt‘s arguments to the contrary, this case does not present the same concerns that we addressed in York Hospital v. Department of Human Services, 2005 ME 41, 869 A.2d 729. That case involved an allegation that an agency‘s decision-making process was itself biased. Id. ¶ 12. Mallinckrodt does not assert that political influence was exerted on the Board; we are therefore not convinced that the Board‘s exclusion of evidence relating to the Commissioner‘s possible political bias amounted to an abuse of discretion.
[¶ 34] We find that Mallinckrodt‘s additional arguments are unpersuasive and do not merit further discussion.
The entry is:
Judgment affirmed.