Appeals court finds Pa. residents can sue coal plant under tort law

The U.S. Court of Appeals for the Third Circuit has reversed a federal district judge in Pennsylvania and ruled that several local residents can bring a state tort law claim again against a 570-MW coal plant now owned by NRG Energy (NYSE:NRG).

The federal Clean Air Act does not necessarily preempt start tort law claims in Pennsylvania brought by private property owners  against a source of pollution located within the state, a three-judge panel for the 3rd Circuit ruled Aug. 20.

The opinion reverses the 2012 finding by District Judge Terrence McVerry and hands a legal setback to the Cheswick power plant and GenOn Power Midwest. Thanks to a merger several months ago, GenOn is now part of NRG Energy.

Kristie Bell and Joan Luppe are the named plaintiffs in a class action complaint against the Cheswick plant in Springdale, Pa.

Complaining of ash and contaminants settling on their property, the Class brought suit against GenOn under several state law tort theories. GenOn argued that because the plant was subject to comprehensive regulation under the Clean Air Act, it owed no extra duty to the members of the class under state tort law.

“On appeal, we are faced with a matter of first impression: whether the Clean Air Act preempts state law tort claims brought by private property owners against a source of pollution located within the state. Based on the plain language of the Clean Air Act and controlling Supreme Court precedent, we conclude that such source state common law actions are not preempted,” the appeals court noted.

The Clean Air Act is an example of “cooperative federalism” that gives individual states primary responsibility for enforcing pollution standards. The Clean Air Act also contains a “citizen suit” provision. “The statute further grants a cause of action against the EPA if it fails to perform any non-discretionary responsibility,” the appeals court said.

The Clean Air Act also contains a separate savings clause entitled “Retention of State authority,” the court said.

GenOn had argued that reversing the district court’s opinion could allow a jury and court to set emissions standards. Likewise, the Utility Air Regulatory Group (UARG) argued that allowing such cases to move forward would “open the proverbial floodgates” to nuisance claims against sources in full compliance with federal and state environmental standards.

But the appeals court said that cooperative federalism enables standards like the Clean Water Act to serve as a “regulatory floor, not a ceiling.”

The three-judge panel concluded: “We see nothing in the Clean Air Act to indicate that Congress intended to preempt source state common law tort claims.”

An NRG Energy spokesperson said the company is reviewing the decision. The federal appeals court case is No. 12-4216.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.