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Chapter 45
Environmental Protection
INTRODUCTION
Fifty years ago, there were only a handful of statutes and regulations, plus old common law concepts,
governing the environment. Regulation was initially aimed at cleaning up damage to the environment. At the end of
the 1970s, there was a shift toward preventive regulation, on the theory that preventing injury to the environment is
less expensive than cleaning up damage after it has occurred. Controlling waste is not without a price, however. For
many businesses, the costs are high, and for some they are too high. There is a constant tension between the
desirability of increasing profits and productivity and the need to attain quality in the environment. This chapter
considers some of the major federal environmental laws.
CHAPTER OUTLINE
I. Common Law Actions
Common law doctrines that were applied against polluters centuries ago may still be applied today.
A. NUISANCE
Persons may be liable if they use their property in a way that unreasonably interferes with others’ rights
to use or enjoy their property. Courts balance the equities between the harm caused and the cost of
stopping it.
2 UNIT NINE: GOVERNMENT REGULATION
• Private nuisance—Distinct harm separate from that affecting the general public is a private
nuisance. Some states require this to support standing for an individual plaintiff.
• Public nuisance—A public authority can maintain an action to stop a public nuisance.
B. NEGLIGENCE AND STRICT LIABILITY
Businesses may be sued under these theories.
ADDITIONAL BACKGROUND—
Proof
The environment receives pollution from many sources. No one source by itself would produce the
damage caused by all the sources together. Because of the widespread effects of pollution, it may be
impossible to provide proof that any particular polluter is solely responsible for a specific injury or damage.
Also, the common law limited relief from pollution in situations where the harm was caused by two or more in-
dependent sources. For example, if a number of firms were polluting the air, a harmed individual could sue
any individual firm; however, until early in the twentieth century, the plaintiff was not able to sue all of the firms
simultaneously. Consequently, specific proof of damages in individual actions was often impossible.
Another difficulty concerning proof has been to relate specific diseases to particular pollution. There is
not always medical or scientific certainty that a particular source of pollution caused a specific disease.
These difficulties in seeking relief in pollution cases, along with the forces creating additional pollution and the
failure of the common law to provide a systematic mechanism for supervising pollution, have been largely
responsible for the development of statutory regulation of environmental quality.
II. Federal, State, and Local Regulations
A. STATE AND LOCAL REGULATIONS
• Many states regulate pollution (for example, by requiring changes in proposed developments). State
laws restrict discharge of chemicals into the water or air (including emissions from motor vehicles),
and regulate disposal of toxic wastes and disposal or recycling of other wastes (metal, plastic,
paper).
• Local governments regulate waste and garbage removal and disposal, the appearance of buildings
and other structures, and noise.
ENHANCING YOUR LECTURE—
CAN A LOCAL REGULATION CONSTITUTE A “TAKING”?
CHAPTER 45: ENVIRONMENTAL PROTECTION 3
Environmental regulations and other legislation to control land use are prevalent throughout the United
States. Generally, these laws reflect the public’s interest in preserving natural resources and habitats for
wildlife. At times, their goal is to enable the public to have access to and enjoy limited natural resources, such
as coastal areas. Although few would disagree with the rationale underlying these laws, the owners of the
private property directly affected by the laws often feel that they should be compensated for the limitation
imposed on their right to do as they wish with their land.
THE DEL MONTE DUNES CASE
One case involved an owner of oceanfront property in Monterey, California. The owner had applied to the
city of Monterey on several occasions for a permit to build a residential development. Each time, the city
denied the use of more of the property until none of it remained available for any use. In effect, the entire
property had to be left in its natural state. The city claimed that it was seeking to protect various forms of
THE TAHOE CASE
In 2002, the United States Supreme Court reviewed another case involving a takings claim. This time,
however, the Court supported the local regulators. The case revolved around an attempt to curb pollution and
the growth of algae in Lake Tahoe, on the California-Nevada border. In 1981, the Tahoe Regional Planning
Agency issued a temporary moratorium (suspension) on the construction of residential housing in areas
around the lake that were the most susceptible to further environmental damage. The moratorium was
extended over the next several years until 1987 when it was replaced by a “revised plan,” which is still in
effect.
4 UNIT NINE: GOVERNMENT REGULATION
FOR CRITICAL ANALYSIS
Even though the Supreme Court sided with the regulators in the Tahoe case, the debate over en-
vironmental takings continues. On the one hand, states, cities, and other local governments want to preserve
their natural resources and need some authority to regulate land use to achieve this goal. On the other hand,
private property owners complain that they alone should not have to bear the costs of environmental
preservation, given that all members of the public reap the benefits. Should private landowners be
compensated when their land is essentially “taken” for public use by environmental regulations?
Should landowners be compensated even when a taking is temporary?
B. FEDERAL REGULATIONS
Federal laws intended to improve environmental quality include the National Environmental Policy Act
(NEPA) of 1969, which requires federal agencies to prepare environmental impact statements (EIS)
when major federal actions significantly affect the quality of the environment.
1. Environmental Regulatory Agencies
There is also a list of federal agencies, including the Environmental Protection Agency (EPA), that
deal with environmental matters.
CASE SYNOPSIS—
Case 45.1: Friends of Animals v. Clay
Migratory birds that congregate near airports threaten human safety. To reduce the risks at New York
City’s John F. Kennedy International Airport (JFK), the Port Authority of New York and New Jersey, which
operates JFK, obtained a permit from the U.S. Fish and Wildlife Service (FWS) to “take” (kill or capture) birds
CHAPTER 45: ENVIRONMENTAL PROTECTION 5
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Notes and Questions
What was the primary interest at stake in this case? How does that interest relate to the purpose
of environmental law? The chief interest at the center of the issue in the Friends case was human safety.
The Migratory Bird Treaty Act (MBTA) prohibits the taking of any bird protected by treaty or federal law. But
2. Environmental Impact Statements
An environmental impact statement (EIS) must be prepared for every major federal action that
significantly affects the quality of the environment. An action qualifies as major if it involves a
substantial commitment of resources (monetary or other). An action is federal if a federal agency
III. Air Pollution
Federal law provides a basis for regulations of pollution emitted from mobile and stationary sources.
A. MOBILE SOURCES
Federal regulations specify standards and timetables for mobile sources (cars, trucks, and other motor
vehicles). The EPA updates these and other standards to reduce emissions further when new scientific
evidence is available.
1. Reducing Emissions over the Long Term
2. Authority to Regulate Greenhouse Gases
According to the EPA, greenhouse gases, including carbon dioxide, are a public danger.
3. Controlling Climate Change
At least one court has allowed a suit challenging the federal government for doing too little to
control climate change.
ADDITIONAL BACKGROUND—
Mobile Sources
Some of the most recent mobile source regulations are discussed in the text. Other provisions
amending the Clean Air Act cover the introduction of alternative-fuel vehicles in California.
To ensure compliance with emission regulations, the EPA certifies a prototype of a new car whose
emission controls are effective up to 50,000 miles. The EPA may inspect production models. If a car does
B. STATIONARY SOURCES
Under the Clean Air Act, the primary responsibility for controlling and preventing pollution from stationary
sources (manufacturing plants and so on) rests with the states. Different standards apply to sources in
clean areas and sources in polluted areas, and to existing sources and major new sources.
1. Hazardous Air Pollutants
The focus is on hazardous air pollutants (HAPs), which are likely to cause death or serious illness
such as cancer. The EPA lists about 200 HAPs.
2. Maximum Achievable Control Technology
Performance standards for major sources require the use of maximum achievable control
technology (MACT), which is subject to EPA guidelines.
CASE SYNOPSIS—
Case 45.2: United States v. O’Malley
CHAPTER 45: ENVIRONMENTAL PROTECTION 7
Duane O’Malley owned and operated Origin Fire Protection. Michael Pinski hired Origin to remove and
..................................................................................................................................................
Notes and Questions
Before O’Malley was hired, he convinced Pinski, the owner of the building with the asbestos-lined pipes,
that he would remove the insulation properly and dispose of it in a proper landfill, and even save Pinski
Does it seem appropriate to impose significant fines on citizens, or even imprison individuals,
when they violate environmental laws? Increasingly, businesspersons and others who violate
How does an individual’s violation of environmental laws also violate the standards of ethics?
Ethics focuses on morality and the way in which moral principles are derived and applied to one’s conduct—
that is, what constitutes right or wrong behavior. Crimes and their consequences can be avoided if the
8 UNIT NINE: GOVERNMENT REGULATION
C. VIOLATIONS OF THE CLEAN AIR ACT
• Civil penalties include assessments of up to $25,000 per day, or an amount equal to a violator’s
economic benefits from noncompliance, plus up to $5,000 per day for other violations.
• Criminal penalties include fines of up to $1 million and imprisonment of up to two years.
• Private citizens can sue.
IV. Water Pollution
Laws and regulations govern the pollution of navigable waters, drinking water, and ocean water. Federal
regulations governing water pollution date from the turn of the last century.
A. THE CLEAN WATER ACT
The Clean Water Act (CWA) of 1972 amended the Federal Water Pollution Control Act (FWPCA) of
1948 and laid out specific time schedules and limits. The goals are to—
• Make waters safe for swimming.
• Protect fish and wildlife.
• Eliminate the discharge of pollutants into the water.
1. Permit System for Point-Source Emissions
Under the CWA and a National Pollutant Discharge Elimination System (NPDES), any point source
of pollution emitted into water must have a permit. Permits can be obtained from the EPA and
authorized state agencies and Indian tribes, and must be reissued every five years. The NPDES
includes—
• National effluent standards set by the EPA for each industry.
2. Standards for Equipment
Regulations specify the use of the best available control technology (BACT) for new sources.
Existing sources must first install the best practical control technology (BPCT).
CASE SYNOPSIS—
Case 45.3: Entergy Corp. v. Riverkeeper, Inc.
The EPA adopted “Phase I” and “Phase II” rules for power plants. Phase I requires new plants to restrict
their inflow of water “to a level commensurate with that which can be attained by a closed-cycle recirculating
cooling water system.” Phase II applies “national performance standards” to more than 500 existing plants,
but do not require closed-cycle cooling systems. The EPA found that to convert these facilities to closed-cycle
operations would cost $3.5 billion per year. The facilities would then produce less power while burning the
same amount of coal. And other technologies can attain nearly the same results as closed-cycle systems.
CHAPTER 45: ENVIRONMENTAL PROTECTION 9
Phase II also allows a variance from the standards if a facility’s cost of compliance “would be significantly
greater than the benefits.” Environmental organizations, including Riverkeeper, Inc., challenged Phase II,
arguing that existing plants should be required to convert to closed-cycle systems. The U.S Court of Appeals
for the Second Circuit issued a ruling in the plaintiffs’ favor. Power-generating companies, including Entergy
Corp., appealed.
The United States Supreme Court affirmed. The EPA could use a cost-benefit analysis to set standards
..................................................................................................................................................
Notes and Questions
Why would Congress intend to forbid comparisons of costs and benefits when determining the
“best available technology”? Preparing and reviewing formal cost-benefit analyses takes time, which can
What are some of the costs and benefits that could be considered in setting the standards and
mandating the technology for existing power plants? The most obvious costs and benefits would be the
impacts of different technologies on the aquatic organisms most directly affected. As for the power plants, the
3. Wetlands
4. Violations of the Clean Water Act
10 UNIT NINE: GOVERNMENT REGULATION
CHAPTER 45: ENVIRONMENTAL PROTECTION 11
B. DRINKING WATER
Under the Safe Drinking Water Act of 1974, the EPA sets maximum levels for pollutants in public water
ADDITIONAL BACKGROUND—
Drinking Water
More than 200 pollutants, many of which are associated with cancer and other serious ailments, are
known to exist in groundwater used for drinking in at least thirty-four states.
C. OCEAN DUMPING
• The Marine Protection, Research, and Sanctuaries Act of 1972 (Ocean Dumping Act) regulates
D. OIL POLLUTION
Under the Oil Pollution Act of 1990, any onshore or offshore oil facility, oil shipper, vessel owner, or
V. Toxic Chemicals and Hazardous Waste
A. PESTICIDES AND HERBICIDES
Under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) of 1947, pesticides and
herbicides must be—
• Registered before they can be sold.
• Certified and used only for approved applications.
• Used in limited quantities when applied to food crops.
1. EPA Actions
The EPA can inspect factories where the chemicals are made and cancel or suspend registration of
substances that are identified as harmful—which means that there can be no greater than a one-
in-a-million chance of people developing cancer from exposure.
2. Violations and Penalties
Violations include selling substances that are not registered or that are labeled falsely. Penalties
include fines off up to $50,000 and imprisonment of up to on year for commercial dealers, with
lesser penalties for private users.
12 UNIT NINE: GOVERNMENT REGULATION
B. TOXIC SUBSTANCES
The Toxic Substances Control Act of 1976 regulates chemicals and chemical compounds that are known
to be toxic and provides for investigation of any possible harmful effects from new compounds. The EPA
regulations require special labeling, production and use quotas, and the prohibiting of use altogether.
C. THE RESOURCE CONSERVATION AND RECOVERY ACT
• The Resource Conservation and Recovery Act (RCRA) of 1976 requires the EPA to determine
which forms of solid waste should be considered hazardous and regulate hazardous waste storage,
disposal, and treatment.
• Penalties for violations include up to $25,000 (civil) per violation, $50,000 (criminal) per day, and
imprisonment up to two years (may be doubled for repeaters).
D. SUPERFUND
The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, or
Superfund) of 1980, regulates the cleanup of leaking hazardous waste disposal sites.
1. Primary Elements
• Information gathering and analysis system that enables the government to identify chemical
dump sites and determine the appropriate action.
• EPA authority to respond to hazardous substance emergencies and to arrange for the cleanup
of a leaking site directly if the persons responsible fail to do so.
• Hazardous Substance Response Trust Fund (Superfund) to pay for the clean up of hazardous
sites using funds obtained through taxes on certain businesses.
• Government recovery of the cost of cleanup from the persons who were (even remotely)
responsible for hazardous substance releases.
2. Potentially Responsible Parties
When a release or a threatened release occurs, the EPA can clean up a site and recover the cost
from—
• A party who generated the waste disposed of at the site.
• A party who transported the waste to the site.
• A party who owned or operated the site at the time of the disposal.
• The current owner or operator.
a. Strict Liability of PRPs
Superfund imposes strict liability on PRPs.
b. Joint and Several Liability of PRPs
One party can be charged with the entire cost (which that party may recover in a contribution
action against others).
3. Minimizing Liability
Businesses that conduct self-audits and promptly detect, disclose, and correct wrongdoing are
subject to lighter penalties. There may be no fines for small companies that correct violations within
180 days (360 days if pollution-prevention techniques are involved).
4. Defenses
An innocent property owner may avoid liability by showing the lack of a contractual or employment
relation to the party who released the hazardous substance. In effect, this requires a buyer to
investigate possible hazards at the time property is bought.
ENHANCING YOUR LECTURE—
HOW CAN YOU KEEP ABREAST OF
ENVIRONMENTAL LAWS?
Businesspersons today increasingly face the threat of severe civil or criminal penalties if they violate
environmental laws and regulations. Thus, it is crucial to be aware of what those laws and regulations are,
how to monitor changes in them, and when to consult with an attorney during the normal course of business.
Consider some areas of concern that affect businesses.
FACTORS TO CONSIDER WHEN PURCHASING BUSINESS PROPERTY
When purchasing business property, keep in mind the environmental problems that may arise. Realize
that it is up to you as a purchaser of the property to raise environmental issues—sellers, title insurance
INVESTIGATE LAND-USE HISTORY
Purchasers of property can be held liable under Superfund for the cleanup of hazardous wastes dumped
by previous property owners. Although current property owners who pay cleanup costs can sue the previous
owners for contribution, such litigation is expensive and the outcome uncertain. Clearly, a more prudent
course is to investigate the history of the use of the land prior to purchasing the property. You might even
want to hire a private environmental site inspector to determine, at a minimum, whether the land has any
obvious signs of former contamination.
INVESTIGATE AND CORRECT ENVIRONMENTAL VIOLATIONS
Today’s companies have an incentive to discover their own environmental wrongdoings. The federal
14 UNIT NINE: GOVERNMENT REGULATION
CHECKLIST FOR THE BUSINESSPERSON
1. If you are going to purchase real estate, use land, or engage in activities that might cause environmental
damage, check with your attorney immediately.
TEACHING SUGGESTIONS
1. To illustrate that the costs of many kinds of pollution are borne not by the polluter but by somebody else,
use an example of what has been called the tragedy of the commons. Ask students to imagine, for example,
2. Explain that one of the problems with common law causes of action in environmental litigation concerned
questions of proof. Because of the widespread effects of pollution, it may be impossible to prove any
3. When CERCLA was enacted, most legislators believed that cleaning up a site was relatively inexpensive
and involved removing containers and scraping a few inches of soil off the ground. Today, there is a
multibillion dollar Superfund industry. Should either of these facts make any difference in the
enforcement or the amendment of CERCLA?
Cyberlaw Link
What are the legal issues surrounding the disposal of computers and related products, many of
which contain hazardous substances? Who should be liable if disposal results in harm to the envi-
ronment or to individuals?
DISCUSSION QUESTIONS
1. How may a polluter be held liable on a common law nuisance theory? A polluter may be held liable for
the use of property in a way that unreasonably interferes with others’ rights to use or enjoy their property. A nuisance
2. Do state and local governments regulate environmental quality? Yes. Many states regulate the degree
3. Under the National Environmental Policy Act, when are federal agencies required to prepare envi-
ronmental impact statements? The National Environmental Policy Act requires federal agencies to prepare
4. How might an environmental impact statement be used? Private citizens, businesses, or others might use
5. The Clean Air Act provides a basis for regulating air pollution from what two kinds of sources? The
6. How are the objectives of the Clean Water Act to be accomplished? The Clean Water Act established a
7. What are specific regulations covering pesticides and herbicides? Under the Federal Insecticide,
8. What does the Comprehensive Environmental Response, Compensation, and Liability Act regulate?
The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, or Superfund) regulates
9. Does it seem appropriate to put businessmen and women in jail when they violate the Clean Water
Act? Increasingly, businesspersons who violate environmental, consumer, health and safety laws and regulations find
10. What should local government bodies do to reduce the level of pollutants in storm-water runoff? To
reduce the level of pollutants in storm-water runoff, local government bodies can become more aggressive in enacting
ACTIVITY AND RESEARCH ASSIGNMENT
Direct students to contact local manufacturers and other businesses to ask about the impact of local, state,
and federal environmental regulations. Some businesspersons may see the regulations as little more than time-
consuming paperwork. Others may be doing more than the law requires to protect the environment. If so, what
more are they doing? Have students share what they learn with the class.
EXPLANATIONS OF SELECTED FOOTNOTES IN THE TEXT
Footnote 3: A well-documented rise in global temperatures has coincided with a significant increase in the
concentration of carbon dioxide in the atmosphere. Some scientists believe that the two trends are related because,
CHAPTER 45: ENVIRONMENTAL PROTECTION 17
In Massachusetts v. Environmental Protection Agency, the United States Supreme Court held that
greenhouse gases fit within the Clean Air Act's (CAA’s) definition of “air pollutant.”
Did the EPA have the authority to regulate greenhouse gas emissions from new motor vehicles? If so,
was its stated reason for refusing to do so consistent with that authority? The Supreme Court held that the
Environmental Protection Agency (EPA) has the authority under that statute to regulate the emission of such gases
from new motor vehicles. According to the Court, the definition, which includes “any” air pollutant, embraces all
Footnote 18: The Environmental Protection Agency (EPA) conditionally registered Strongarm, a new
In Bates v. Dow Agrosciences, LLC, the United States Supreme Court vacated the judgment. A state can
regulate the sale and use of federally registered pesticides to the extent that it does not permit anything that FIFRA
prohibits, but a state cannot impose any requirements for labeling or packaging in addition to or different from those
Prior to 1910, as the Court explained in the Bates case, the states provided the primary, and possibly the
exclusive, source of regulatory control over the distribution of poisonous substances. Both the federal government’s
18 UNIT NINE: GOVERNMENT REGULATION
first effort at regulation in this area, the Insecticide Act of 1910, and FIFRA as originally enacted in 1947 primarily
dealt with licensing and labeling. It was not until 1972 that FIFRA began to take on its present contours. As stated in
the text, tort suits against pesticide manufacturers were common long before 1947 and continued to be a part of the
legal landscape after 1972 If it was generally held that state law claims were not preempted by FIFRA when the
statute was enacted and later amended, when and why did the question arise? As the Court noted in the Bates
Suppose that FIFRA required Strongarm’s label to include the word CAUTION, and the Texas peanut
farmers filed their claims under a state regulation that required the label to use the word DANGER. Would the
According to the Court’s interpretation, what is required for a state regulation or rule to be preempted
under FIFRA? Why is this significant? The Court reasoned that for a state rule to be preempted under FIFRA, it
must be a requirement “for labeling or packaging” that is “in addition to or different from those required under” FIFRA.
