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Wild Fish Conservancy v. Cooke Aquaculture Pacific, LLC

United States District Court, W.D. Washington, Seattle

June 26, 2019

WILD FISH CONSERVANCY, Plaintiff,
v.
COOKE AQUACULTURE PACIFIC, LLC, Defendant.

          ORDER

          JOHN C. COUGHENOUR, UNITED STATES DISTRICT JUDGE

         This matter comes before the Court on Defendant's motion for partial summary judgment (Dkt. No. 41), motion to amend its answer (Dkt. No. 64), and motion to seal (Dkt. No. 34). Having thoroughly considered the parties' briefing and the relevant record, the Court finds oral argument unnecessary and hereby GRANTS in part and DENIES in part the motion for summary judgment (Dkt. No. 41), GRANTS in part and DENIES in part the motion to amend (Dkt. No. 64), and GRANTS the motion to seal (Dkt. No. 34) for the reasons explained herein.

         I. BACKGROUND

         This lawsuit arises out of the 2017 collapse of one of Defendant Cooke Aquaculture Pacific LLC's Atlantic salmon net-pen facilities (“Cypress 2”) in Deepwater Bay off of Cypress Island, Washington. (See Dkt. No. 1 at 9-10.) The Clean Water Act (“CWA”) prohibits discharges of pollutants into the waters of the United States, except pursuant to a National Pollutant Discharge Elimination System (“NPDES”) permit. 33 U.S.C. § 1342. As provided by the CWA, authorized state agencies may issue NPDES permits and enforce permit requirements. See 33 § U.S.C. 1342(b). In Washington, the Department of Ecology (“Ecology”) performs the functions necessary to “meet the requirements” of the CWA, including issuing NPDES permits. Wash. Rev. Code. § 90.48.260.

         Prior to the collapse of Cypress 2, Defendant operated eight Atlantic salmon net-pen facilities across Puget Sound pursuant to separate NPDES permits issued by Ecology. (See Dkt. Nos. 29-2 at 7-62, 44 at 4-33.)[1] Defendant's NPDES permits imposed numerous requirements for minimizing the discharge of pollutants from the facilities, which the Court discusses in greater detail infra. (See Dkt. No. 44 at 8-21.); see Part II.B Defendant's NPDES permit for Cypress 2 was issued in October 2007 and was in force at all times relevant to this lawsuit. (Dkt. Nos. 42 at 5, 14; 44 at 1.)[2] Defendant operated Cypress 2 on submerged lands leased from the Washington State Department of Natural Resources (“DNR”). (Dkt. No. 52-1 at 37-69.) The lease began in January 2008 and was scheduled to run until December 2023. (Id. at 39.)[3]

         On August 19, 2017, Cypress 2 experienced mooring failures during very strong tidal currents. (Dkt. No. 42 at 2.) These mooring failures progressed over the following days and resulted in the facility's collapse and eventual destruction. (Id. at 2-3.) The catastrophic collapse of Cypress 2 resulted in the estimated release of more than 200, 000 Atlantic salmon into Puget Sound. (Dkt. No. 29-2 at 200.) The collapse also resulted in the release of other debris from the facility into Puget Sound. (Id. at 211-212.) On August 24, 2017, Plaintiff sent Defendant a “Notice of Intent to Sue Under the Clean Water Act” letter (“notice letter”), and sent a supplemental notice letter on September 6, 2017. (Dkt. No. 1 at 22, 30.) On November 13, 2017, Plaintiff filed a complaint against Defendant asserting several CWA violations related to the Cypress 2 collapse, as well as violations at Defendant's seven other Puget Sound net-pen facilities. (See generally id.)

         On August 25, 2017, DNR notified Defendant that it had defaulted on its obligations under the parties' lease and demanded that Defendant remove all damaged materials from the Cypress 2 site. (Dkt. No. 52-1 at 145.) DNR stated that it may terminate the lease if Defendant did not cure the default by September 24, 2017. (Id.) In a letter to DNR dated September 1, 2017, Defendant stated that it had “been implementing its Fish Escape Prevention Plan” and “reserve[d] all rights with respect to the Lease . . . .” (Id. at 149.) Defendant proceeded to conduct cleanup, salvage, and remediation at and around the Cypress 2 site throughout the rest of 2017 and into 2018. (See Dkt. Nos. 42, at 3-4, 29-2 at 210-12.)

         On January 30, 2018, Ecology issued a $332, 000 administrative penalty against Defendant arising from the Cypress 2 collapse. (Dkt. No. 52-1 at 160-66.) Ecology concluded that Defendant violated its NPDES permit by negligently allowing the release of farmed salmon, failing to inspect anchoring components deeper than 100 feet, and by not adequately cleaning the facility's nets. (Id. at 163-64.) On March 1, 2018, Defendant appealed Ecology's penalty to the Washington State Pollution Control Hearings Board. (Dkt. Nos. 42 at 4, 52-1 at 169); see also Wash. Rev. Code §§ 43.21B.010, 43.21B.110.

         On February 2, 2018, DNR terminated Defendant's lease for Cypress 2. (Dkt. No. 42 at 4.) Defendant responded on March 1, 2018 by filing a complaint in Thurston County Superior Court challenging DNR's termination of the lease. (Dkt. No. 52-1 at 11-32.) Among other relief, Defendant sought a declaratory judgment that DNR was not “entitled to withhold its consent to [Defendant's] reconstruction of [Cypress] 2 . . . and that it is entitled to restock [Cypress] 2 as soon as it has been rebuilt.” (Id. at 28.)

         On March 22, 2018, Washington's governor signed legislation that prohibits DNR from either granting new leases of aquatic lands for non-native finfish aquaculture projects or renewing or extending a lease in existence as of June 7, 2018 that includes non-native finfish aquaculture. See Wash. Rev. Code § 79.105.170; see also H.B. 2957, 65th Leg., Reg. Sess. (Wash. 2018). On December 21, 2018, Defendant requested that Ecology terminate its NPDES permit for Cypress 2. (Dkt. No. 42 at 14.) Ecology has not terminated the permit. (Id. at 4.)

         On April 24, 2019, Defendant and Ecology entered a consent decree to resolve Defendant's liability related to the Cypress 2 collapse and the corresponding violations identified by Ecology in its notice of administrative penalty. (See Dkt. No. 74-1 at 4-11.) On April 25, 2019, the Pollution Control Board, pursuant to the consent decree, dismissed Defendant's appeal of Ecology's administrative penalty. (Id. at 18.) Defendant has not conducted net-pen operations at Cypress 2 since its collapse in August 2017. (Dkt. No. 43 at 3.) In fact, the Cypress 2 facility no longer exists, and its remains were ultimately salvaged and removed from the site following the collapse. (Id.; see Dkt. No. 29-2 at 210-212.) Defendant states that it has no intention of rebuilding Cypress 2. (Dkt. No. 43 at 3.)

         Defendant moves for summary judgment on all of Plaintiff's claims related to Cypress 2. (See Dkt. No. 41.) Defendant raises two primary arguments. (Id. at 4.) First, Defendant argues that when Plaintiff filed its complaint in November 2017, there were no ongoing CWA violations at Cypress 2. (Id. at 17.) Second, Defendant argues that Plaintiff's CWA claims were mooted by the involuntary closure of Cypress 2 and subsequent administrative and legislative actions that prevent Defendant from resuming operations at the facility. (Id. at 19.) Plaintiff opposes Defendant's motion on both grounds. (See Dkt. No. 52.)

         II. DISCUSSION

         A. Legal Standards

         1. Summary Judgment

         Summary judgment is appropriate when the moving party demonstrates that no genuine dispute of material fact exists and that the Court can enter a judgment in favor of the moving party as a matter of law. Fed.R.Civ.P. 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). In making such a determination, the Court must view the facts and justifiable inferences to be drawn therefrom in the light most favorable to the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). The moving party bears the initial burden to demonstrate that no genuine dispute of material fact exists. Celotex, 477 U.S. at 323. If the moving party does not bear the ultimate burden of proof at trial, then it can demonstrate the absence of a dispute of material fact by either (1) producing evidence to negate an essential element of the nonmoving party's claim, or (2) demonstrating that the nonmoving party lacks evidence to meet its ultimate burden at trial. Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1106 (9th Cir. 2000). If the moving party meets its initial burden of production, then the burden shifts to the nonmoving party to adduce evidence that could reasonably lead a factfinder to find in favor of the nonmoving party, creating a genuine dispute of material fact. Celotex, 477 U.S. at 1187.

         2. Ongoing Violations

         A CWA citizen suit must allege violations that are “ongoing” at the time the complaint was filed. Sierra Club v. Union Oil Co. of California, 853 F.2d 667, 669 (9th Cir. 1988) (citing Gwaltney v. Chesapeake Bay Foundation, 484 U.S. 49 (1987)). As such, a citizen suit may not be premised upon “wholly past violations, ” and district courts only have jurisdiction over complaints that allege, in good faith, continuing or intermittent violations. Nat. Res. Def. Council v. Sw. Marine, Inc., 236 F.3d 985, 999-1001 (9th Cir. 2000).

         At trial, a citizen plaintiff must prove ongoing violations by either (1) demonstrating that violations continued on or after the date of the complaint, or (2) by adducing evidence that would allow a reasonable factfinder to find a “continuing likelihood of a recurrence in intermittent or sporadic violations.” Sierra Club, 853 F.2d at 671. Such intermittent or sporadic violations are ongoing unless “no real likelihood of repetition” exists and “the risk of defendant's continued violation has been completely eradicated when the citizen-plaintiffs filed suit.” Id. To determine whether ongoing violations exist, the Court may consider whether the defendant took remedial actions to cure its violations, what probability exists that the remedial actions will cure the violations, or other evidence that shows whether the continued violation had been “completely eradicated” when the plaintiff filed its lawsuit. Id.

         3. Mootness

         To establish mootness, a defendant must show that the district court cannot order any effective relief. See City of Erie v. Pap's A.M., 529 U.S. 277, 287 (2000); Sierra Club, 853 F.2d at 669)(“The burden of proving that the case is moot is on the defendant.”). The seminal case analyzing mootness in the context of a CWA citizen suit is Friends of the Earth v. Laidlaw, 528 U.S. 167 (2000). In Laidlaw, the Supreme Court reversed the Fourth Circuit's holding that a citizen suit seeking civil penalties was moot because the alleged CWA violations had ceased. Id. at 174. The Supreme Court noted that the cessation of illegal conduct following the commencement of suit “ordinarily does not suffice to moot a case” because civil penalties still serve as a deterrent to future violations. Id.

         The Supreme Court reached this conclusion even though the polluting facility at issue had been “permanently closed, dismantled, and put up for sale, and all discharges from the facility had permanently ceased.” Id. at 179. The Supreme Court held that only when it is “absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur” will events following the commencement of a suit moot a claim for civil penalties. Id. at 189. The Ninth Circuit has followed the Supreme Court's decision in Laidlaw by placing a heavy burden on CWA defendants to prove that a citizen suit is truly moot. See, e.g., San Francisco BayKeeper, Inc. v. Tosco Corp., 309 F.3d 1153, 1160 (9th Cir. 2002) (holding citizen suit seeking monetary penalties not moot where the defendant had sold the polluting facility); Ecological Rights Found. v. Pac. Lumber Co., 230 F.3d 1141, 1153 (9th Cir. 2000) (holding that citizen suit seeking monetary penalties was not mooted by implementation of a new NPEDES permit).

         B. Ongoing Violations

         Defendant first argues that it is entitled to summary judgment on Plaintiff's claims regarding Cypress 2 because Plaintiff has not alleged facts demonstrating that any ongoing CWA violations existed at the time it filed its complaint. (Dkt. No. 41 at 5.) Applying the framework adopted in Sierra Club v. Union Oil, the Court examines each claim to determine if there are genuine disputes of material fact regarding whether, as of November 13, 2017, violations were actually occurring at Cypress 2, or whether there was a reasonable likelihood of a recurrence of sporadic or intermittent violations. 853 F.2d at 671.[4]

         1. Section 301(a) of the CWA

         Plaintiff alleges that Defendant violated Section 301(a) of the CWA because the collapse of Cypress 2 resulted in “massive discharges of various pollutants into Puget Sound, including but not limited to, non-native Atlantic salmon, debris, solid and liquid wastes, nets, feed, machinery, equipment, walkways, moorings and other structures, fuels, greases, oils, and other petroleum products.” (Dkt. No. 1 at 11.) “Section 301(a) of the [Clean Water Act] prohibits the ‘discharge of any pollutant' from any ‘point source' into ‘navigable waters' unless the discharge complies with certain other sections of the CWA.” Natural Res. Def. Council, Inc. v. Cnty. of L.A., 725 F.3d 1194, 1198 (9th Cir. 2013) (citing 33 U.S.C. § 1311(a)). A defendant with an NPDES permit is generally shielded from liability from the CWA's prohibition on discharging pollutants so long as they are expressly authorized by the permit. Alaska Cmty. Action on Toxics v. Aurora Energy Servs., LLC, 765 F.3d 1169, 1171 (9th Cir. 2014).

         Defendant argues that none of the discharges identified by Plaintiff were actually occurring at Cypress 2 when Plaintiff filed its complaint because the facility was destroyed and no longer operational. (Dkt. No. 41 at 17-19.) Essentially, Defendant argues that once Cypress 2 was destroyed it was no longer functioning as a “point source” that was discharging “pollutants” into Puget Sound. (Id.)[5] Plaintiff argues that there was an ongoing violation of Section 301(a) in November 2017 because debris from Cypress 2 remained scattered in Puget Sound. (Dkt. No. 52 at 17.) Plaintiff points out that Defendant continued to conduct cleanup and salvage operations at the Cypress 2 site into 2018. (Dkt. No. 29-2 at 211-12.) Plaintiff directs the Court to out-of-circuit caselaw standing for the proposition that a discharged pollutant can provide the basis for an ongoing Section 301(a) violation until it is removed from the navigable waters at issue. (Dkt. No. 52 at 17) (citing Atl. States Legal Found., Inc. v. Hamelin, 182 F.Supp.2d 235, 248 n. 20 (N.D.N.Y. 2001) (collecting cases)).

         The Court disagrees with Plaintiff's theory of continuing violations. Section 301(a) specifically prohibits the unpermitted discharges of pollutants from point sources-it does not govern the failure to clean up pollutants after they have been discharged from a point source. See 33 U.S.C. ยง 1311(a). Plaintiff does not point to any Ninth Circuit case law to support its theory that debris from Cypress 2 that remained in Puget Sound when the complaint was filed amounted to an ongoing violation of Section 301(a). Thus, Plaintiff has not presented evidence ...


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