Court rejects GE challenge to EPA cleanup orders

EPA Superfund due process ruling affirms CERCLA authority, upholding unilateral administrative orders and the polluter-pays principle. An appeals court rejected GE's constitutional claims over hazardous waste cleanup, fines, and compliance, reinforcing EPA enforcement.

A U.S. appeals court rejected a legal challenge by General Electric Co to the federal Environmental Protection Agency's EPA orders that direct companies to clean up hazardous waste.

The court rejected the company's argument, much as another court denied an attempt to block EPA rules in a separate case, that the law and the way EPA administers it violated constitutional due process rights because the agency issued the orders without a hearing before a neutral decision maker.

The ruling was a setback to GE's long-running effort to overturn a provision of Comprehensive Environmental Response, Compensation, and Liability Act, known as the Superfund law that seeks to ensure that polluters pay for the environmental hazards they created.

At issue were EPA's unilateral administrative orders that direct companies and others to clean up hazardous waste, and in other contexts courts have upheld a power plant cooling water rule affecting power plant operations, for which they are responsible if the sites pose an imminent and substantial threat to public safety.

Companies that fail to follow the orders can face large fines.

GE had argued that the mere issuance of an order could inflict immediate, serious, and irreparable damage, similar to calls to side with power plants over fish in permitting disputes, by depressing a company's stock price and increasing its cost of financing.

But the three-judge panel, echoing a Clean Air Act ruling from the Bush era, unanimously rejected the company's arguments.

"Such 'consequential' injuries — injuries resulting not from EPA's issuance of the order but from market reactions to it — are insufficient to merit constitutional due process protection," Judge David Tatel wrote in the ruling.

To the extent the regime implicated constitutionally protected property interests by imposing compliance costs and threatening fines and punitive damages, the system satisfied due process, even as critics have accused EPA of flouting Supreme Court rulings in other matters, because recipients can obtain a hearing by refusing to comply and forcing EPA to sue in federal court, he said.

The appeals court upheld a federal judge's ruling in favor of EPA.

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