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Decided: July 1, 2015

The Fourth Circuit held that the District Court for the District of Maryland incorrectly granted Defendants’ Motions for Dismissal on claims the Plaintiffs brought under the Resource Conservation and Recovery Act (RCRA).  The Fourth Circuit thus vacated the dismissals, and remanded the case.

In 2012, the Mayor of Baltimore, City Council of Baltimore, and City of Baltimore Development Corporation (hereinafter collectively “City”) made an agreement with CBAC Gaming and its subsidiary CBAC Borrower LLC (hereinafter collectively “CBAC”) to develop an 8.5 acre site in Baltimore as a casino.  The site had previously been used for a variety of industrial purposes.  One of the former landowners, Maryland Chemical Co., Inc. (“Maryland Chemical”), had “conducted ‘chemical manufacturing and/or bulk chemical storage, repackaging and distribution’” for around 50 years when it owned part of the land.

Plaintiffs, residents of Maryland, brought suit against City, CBAC, and Maryland Chemical.  Based on environmental assessments from the 1990s and early 2000s, Plaintiffs alleged that the casino site was contaminated with hazardous waste, which was moving downhill to an adjacent City-owned riverfront recreation site, and into the river.  Plaintiffs further alleged that Defendants’ actions on the casino site violated RCRA.  Defendants moved to dismiss the claims against them, and the district court granted all dismissals.  Plaintiffs appealed.

RCRA, 42 U.S.C. 6901 et.seq., is a comprehensive environmental statute which covers how to store, treat, and dispose of solid and hazardous waste.  Part of the RCRA, 42 U.S.C. 6972(a)(1)(A)-(B), authorizes suit by private citizens for violations.  Citizens can sue for:  1) an ongoing violation of a permit required under the RCRA, or under a parallel state standard authorized under RCRA, or 2) a past or present violation which poses a substantial, imminent danger to health or the environment.  

Plaintiffs sued CBAC under both prongs of 42 U.S.C. 6972(a)(1)(A)-(B), claiming that remedial activities it promised to undertake in during construction did not meet RCRA, and that construction would contribute to contamination, and the migration of contaminants.  CBAC moved for dismissal under Fed. R. Civ. P 12(b)(1) for lack of subject matter jurisdiction, arguing that an anti-duplication provision of RCRA meant that the permits it obtained under a different environmental protection system protected it from RCRA liability.  CBAC also moved for dismissal under Fed. R. Civ. P 12(b)(6) for failure to state a claim.  Although the district court did not clearly state the rule under which it dismissed the claims against CBAC, it found that a RCRA claim could not proceed against CBAC because the requirements under the alternative permitting system would be inconsistent with the requirements under the RCRA.  The Fourth Circuit found the district court’s reasoning incorrect under either Fed. R. Civ. P. 12(b)(1), or 12(b)(6).  Under 12(b)(1), the Fourth Circuit held that the plain language of the RCRA non-duplication statute was not jurisdictional.  Under 12(b)(6), the court found that the district court did not properly analyze whether the requirements of the two permitting systems were actually inconsistent, and in any case, the complicated facts and issues at stake made the case particularly ill-suited to dismissal for failure to state a claim.  The Fourth Circuit thus held that the district court improperly dismissed the claims against CBAC under either 12(b)(1) or 12(b)(6).  

Plaintiffs also brought claims under both prongs against the City, and the district court dismissed for failure to state a claim.  The Fourth Circuit held that Plaintiffs had shown a sufficient case under each prong to survive a motion to dismiss.  Under the ongoing permitting prong, the Fourth Circuit found that Plaintiffs had alleged the City owned some of the property where violations were occurring, and there were ongoing specific violations of the type RCRA covers.  Under the past or present violations threatening harm to health or the environment prong, the Fourth Circuit found that Plaintiffs had alleged actions by the city that fit within the RCRA, and that even if the City was trying to remediate past damage, it could violate RCRA during remediation.  

Plaintiffs brought a claim against Maryland Chemical under the past or present violations harming health or the environment prong.  The district court dismissed for failure to state a claim, since it found that the Plaintiff’s allegations did not include enough active human participation by Maryland Chemical to meet the requirements of a RCRA claim.  Relying on the plain language of the statute, the Fourth Circuit found that the Plaintiffs’ allegations contained enough evidence of active participation by Maryland Chemical in activities that would violate RCRA to survive a motion to dismiss.  

For the above reasons, the Fourth Circuit vacated the district court’s dismissal of all claims, and remanded to the district court.

Full Opinion

Katherine H. Flynn