Common Law Enforcement: How Should Businesses Respond to this Trend?

Several court decisions this summer raise the possibility of increased attempts to use common law theories to enforce environmental standards, in some cases, even where the regulatory agencies have not set standards.   In American Electric Power Co. v Connecticut __ US __ (2011), the plaintiffs were states and environmental groups claiming that greenhouse gas emissions by power generating companies constitute a common law nuisance.  While the Supreme Court rejected the plaintiffs’ claim on the ground that there is no federal common law of nuisance, the Court declined to address whether state common law nuisance claims could be used to set environmental standards.

In State of New York v West Site Corp., E.D.N.Y (2011), the court held that section 107 of the Superfund Law does not pre-empt State common law tort claims.  The State cleaned up the site and brought a cost recovery claim under the Superfund Law.  The State included with its federal Superfund claims, state law claims for public nuisance, indemnity and restitution.  Defendants moved to dismiss the State law tort claims alleging that they were pre-empted because of a possible conflict with the Superfund Law.  The Court denied the motion, holding that while common law tort claims may be pre-empted by a Superfund contribution action (section 113), there is no conflict between a State enforcement action under section 107 of the Superfund Law and the state common law claims.

The increased use of common law remedies to enforce environmental standards points out a major principal of regulatory law.  Businesses have two independent obligations with regard to regulatory compliance:  (1) comply with the regulations and (2) take reasonable steps to avoid causing injury.  In a highly regulated area such as the environment, businesses tend to look to the regulations as their entire burden.  The Supreme Court, by leaving open the possibility of state common law nuisance claims, is suggesting that the lack of regulatory agency standards does not mean the businesses have no standards to comply with; they must at all times take reasonable steps to avoid causing injury.