RECORD NO In The United States Court Of Appeals For The Fourth Circuit

Transcription

1 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 1 of 40 RECORD NO In The United States Court Of Appeals For The Fourth Circuit PETER WALDBURGER; SANDRA RATCLIFFE; LEE ANN SMITH; TOM PINNER, IV, a/k/a Bud Pinner, IV; HANS MOMKES; WILMA MOMKES; WALTER DOCKINS, JR.; AUTUMN DOCKINS; WILLIAM CLARK LISENBEE; DAN MURPHY; LORI MURPHY; ROBERT AVERSANO; DANIEL L. MURPHY; LAURA A. CARSON; GLEN HORECKY; GINA HORECKY; RENEE RICHARDSON; DAVID BRADLEY; BYRON HOVEY; RAMONA HOVEY; PETER TATUM MACQUEEN, IV; BETHAN MACQUEEN; PATRICIA PINNER; TOM PINNER, III, a/k/a Buddy Pinner, III; MADELINE PINNER, Plaintiffs Appellants, v. CTS CORPORATION, Defendant Appellee. ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE W ESTERN DISTRICT OF NORTH CAROLINA AT ASHEVILLE REPLY BRIEF OF APPELLANTS John J. Korzen, Director Hillary M. Kies, Third-Year Law Student Emma A. Maddux, Third-Year Law Student WAKE FOREST UNIVERSITY SCHOOL OF LAW Appellate Advocacy Clinic Post Office Box 7206 Reynolda Station Winston-Salem, NC (336) Counsel for Appellants G ibs onm oore Ap pe llate Ser vices, L L C 421 Eas t Frank lin S tree t, Su ite 230 Richm on d, V A (804 ) onm oore.ne t

2 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 2 of 40 TABLE OF CONTENTS Page TABLE OF AUTHORITIES... iii REPLY TO STATEMENT IN UNITED STATES BRIEF... 1 A. Interest of the United States... 1 B. The North Carolina Statute... 2 ARGUMENT... 4 I. CONGRESS INTENDED FOR THE DISCOVERY RULE IN CERCLA SECTION 9658 TO APPLY TO ALL STATE LIMITATIONS PERIODS AND DID NOT INTEND A DISTINCTION BETWEEN STATUTES OF LIMITATION AND STATUTES OF REPOSE... 4 A. Either Congress clearly intended section 9658 to apply to all state limitations periods, or the scope of section 9658 is ambiguous Congress clearly intended section 9658 to apply to all state limitations periods, with no exception for statutes of repose... 4 a. Congress clearly intended section 9658 to apply to all state limitations periods... 5 b. Defendant applies plain meaning rules too narrowly Whether Congress intended section 9658 to apply to statutes of repose is at least ambiguous B. Legislative history shows that Congress intended that the federally required commencement date preempt all shorter state limitations periods, including statutes of repose i

3 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 3 of The legislative intent behind section 9658 was to preempt all state limitation periods that did not include a discovery rule Other courts considering congressional intent have concluded that section 9658 preempts statutes of repose C. The District Court s construction would lead to absurd results CONCLUSION CERTIFICATE OF COMPLIANCE CERTIFICATE OF FILING AND SERVICE ii

4 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 4 of 40 TABLE OF AUTHORITIES Page(s) Cases: A.S.I., Inc. v. Sanders, 835 F. Supp (D. Kan. 2005)... 14, 24 Abrams v. Ciba Specialty Chem. Corp., 659 F. Supp. 2d 1255 (S.D. Ala. 2009)... 14, 25, 27 Anderson v. United States, 669 F.3d 161 (4th Cir. 2011) APA Excelsior III L.P. v. Premiere Techs., Inc., 476 F.3d 1261 (11th Cir. 2007) Barnes v. Koppers, Inc., 534 F.3d 357 (5th Cir. 2008) Boudreau v. Baughman, 322 N.C. 331, 368 S.E.2d 849 (1988) Buggsi, Inc. v. Chevron U.S.A., Inc., 857 F. Supp (D. Or. 1994)... 14, Burlington N. & Santa Fe Ry. Co. v. Poole Chem. Co., 419 F.3d 355 (5th Cir. 2005)...passim Chatham Steel Corp. v. Brown, 858 F. Supp (N.D. Fla. 1994)... 14, 24 Cooper Indus., Inc. v. Availl Servs., Inc., 543 U.S. 157 (2004)... 9, 10 FDIC v. Phila. Gear Corp., 476 U.S. 426 (1986) First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862 (4th Cir. 1989)... 10, 20 iii

5 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 5 of 40 Freier v. Westinghouse Elec. Corp., 303 F.3d 176 (2d Cir. 2002) German v. CSX Transp., Inc., 510 F. Supp. 2d 630 (S.D. Ala. 2007) Green v. Bock Laundry Mach. Co., 490 U.S. 504 (1989) Holland v. Big River Minerals Corp., 181 F.3d 597 (4th Cir. 1999)... 9 In re Camp Lejeune, North Carolina Water Contamination Litig., No. 11-md-2218, Doc. 87 (N.D. Ga. Aug. 9, 2012)... 1, 2, 10, 14 In re S. Star Foods, Inc., 144 F.3d 712 (10th Cir. 1998) Jones v. United States, 789 F. Supp. 2d 883 (M.D. Tenn. 2011) Jones v. United States, No. 7:09-CV-106-BO, Doc. 49 (E.D.N.C. Nov. 10, 2010); Doc. 56 (E.D.N.C. Feb. 23, 2011)... 1 Landis v. Physicians Ins. Co. of Wis., Inc., 628 N.W.2d 893 (Wis. 2001) , 12 Lansford-Coaldale Joint Water Auth. v. Tonolli Corp., 4 F.3d 1209 (3d Cir. 1993) London v. Fieldale Farms Corp., 410 F.3d 1295 (11th Cir. 2005) McDonald v. Sun Oil, Co., 548 F.3d 774 (9th Cir. 2008)...12, 22, 23, 24, 28 Pub. Citizen v. U.S. Dept. of Justice, 491 U.S. 440 (1989) iv

6 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 6 of 40 Rehab. Ass'n of Va., Inc. v. Kozlowski, 42 F.3d 1444 (4th Cir. 1994) Riegel v. Medtronic, Inc., 552 U.S. 312 (2008) Robinson v. Shell Oil Co., 519 U.S. 337 (1997)... 9 Stiltner v. Beretta U.S.A. Corp., 74 F.3d 1473 (4th Cir. 1996) United States v. Bestfoods, 534 U.S. 51 (1998)... 16, 27 United States v. Chong Lam, 677 F.3d 190 (4th Cir. 2012)... 7 United States v. Dodson, 291 F.3d 268 (4th Cir. 2002)... 6 United States v. Harris, 128 F.3d 850 (4th Cir. 1997)... 7 United States v. Hoang, 636 F.3d 677 (5th Cir. 2011) United States v. Ron Pair Enters., Inc., 489 U.S. 235 (1989) Watt v. Alaska, 451 U.S. 259 (1981) Zander v. United States, 786 F. Supp. 2d 880 (D. Md. 2011) Statutes: 18 U.S.C. 2320(e)(1)(A) U.S.C et seq.(cercla)...passim v

7 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 7 of U.S.C. 9613(f) ( CERCLA 113(f)(1) ) U.S.C. 9651(e)(1) U.S.C passim 42 U.S.C. 9658(a) U.S.C. 9658(a)(1) U.S.C. 9658(a)(2) U.S.C. 9658(b)(3) Md. Code Ann N.C. Gen. Stat. 1-15(c)... 4 N.C. Gen. Stat , 8, 21 N.C. Gen. Stat N.C. Gen. Stat. 1-52(16)...passim Legislative History: Adam Walsh Child Protection and Safety Act, Title I, Sex Offender Registration and Notification Act ( SORNA ), Pub. L. No (2006) H.R. Conf. Rep. No (1986) Janey Ensminger Act 102, Pub. L. No (2012)... 2 S. Rep. No (1980) vi

8 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 8 of 40 Other Authorities: Black s Law Dictionary (5th ed. 1979)... 6, 7, 18, 24 Black s Law Dictionary (6th ed. 1990)... 7 Black s Law Dictionary (7th ed. 1999)... 7 Black s Law Dictionary (9th ed. 2009)... 6 Injuries and Damages From Hazardous Wastes Analysis and Improvement of Legal Remedies 240 (July 1, 1982)...passim vii

9 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 9 of 40 REPLY TO STATEMENT IN UNITED STATES BRIEF A. Interest of the United States The United States acknowledges that its interest in this case stems from the ongoing litigation in the Northern District of Georgia, which has certified the same question at issue for interlocutory appeal, in In re Camp Lejeune, North Carolina Water Contamination Litig., No. 11-md-2218, Doc. 87 (N.D. Ga. Aug. 9, 2012). See US Br. at 1-2. In that litigation, two federal judges have denied the government s motions to dismiss based on the North Carolina statute at issue in this appeal, N.C. Gen. Stat. 1-52(16). The most recent order, the one now on interlocutory appeal to the Eleventh Circuit, can be found in the record in this case. See JA There Senior United States District Judge J. Owen Forrester concluded that CERCLA can preempt both state statutes of limitation and state statutes of repose. See JA Previously, when one of the plaintiffs claims in the Camp Lejeune litigation was pending in the Eastern District of North Carolina, United States District Judge Terrence W. Boyle concluded that section 1-52(16) does not apply to claims for latent disease. Judge Boyle denied both the government s motion to dismiss and its motion for reconsideration. See Jones v. United States, No. 7:09-CV-106-BO, Doc. 49 (E.D.N.C. Nov. 10, 2010); Doc. 56 (E.D.N.C. Feb. 23, 2011). 1

10 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 10 of 40 Finally as to the Camp Lejeune litigation that is the basis for the government s interest, the Senate Veterans Affairs Committee believes over 500,000 marines and their families were exposed to toxic substances in Camp Lejeune s water between the 1950 s and Id., Doc. 49 at 9. Congress recently passed legislation, signed into law by President Obama on August 6, that provides hospital care and medical services for veterans and family members who lived at Camp Lejeune and have developed various cancers or other conditions, including female infertility and neurobehavioral effects. See Janey Ensminger Act 102, Pub. L. No (2012). The government s attorneys have fought the claims of former Camp Lejeune residents tooth and nail, and obviously desire a supportive ruling from this Court regarding section 1-52(16), but even the 112 th Congress has supported the former residents with unanimous bipartisan support. B. The North Carolina Statute Both the United States and Defendant, in describing section 1-52(16), fail to include any statutory context. See US Br. at 5-6; CTS Br. at 10. As shown below, section 1-52(16) is contained in the Chapter of North Carolina statutes for Civil Procedure, in an Article for Limitations. The titles for the chapter, subchapters, articles, and statutes surrounding section 1-52(16), and the applicable statutes text are as follows: 2

11 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 11 of 40 NORTH CAROLINA GENERAL STATUTES 1 Chapter 1. Civil Procedure. SUBCHAPTER 1. DEFINITIONS AND GENERAL PROVISIONS Article 1. Definitions Article 2. General Provisions SUBCHAPTER 2. LIMITATIONS Article 3. Limitations, General Provisions Article 4. Limitations, Real Property Article 5. Limitations, Other Than Real Property Periods prescribed Twelve years 1-47 Ten years 1-48 Transferred to Seven years 1-50 Six years 1-51 Five years 1-52 Three years 1-53 Two years 1-54 One year Two months 1-55 Six months From West s North Carolina General Statutes Annotated. 3

12 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 12 of 40 N.C. Gen. Stat Periods prescribed The periods prescribed for the commencement of actions, other than for the recovery of real property, are as set forth in this Article. Within three years an action... N.C. Gen. Stat Three years (16) Unless otherwise provided by statute, for personal injury or physical damage to claimant's property, the cause of action, except in causes of actions referred to in G.S. 1-15(c), shall not accrue until bodily harm to the claimant or physical damage to his property becomes apparent or ought reasonably to have become apparent to the claimant, whichever event first occurs. Provided that no cause of action shall accrue more than 10 years from the last act or omission of the defendant giving rise to the cause of action..... ARGUMENT I. CONGRESS INTENDED FOR THE DISCOVERY RULE IN CERCLA SECTION 9658 TO APPLY TO ALL STATE LIMITATIONS PERIODS AND DID NOT INTEND A DISTINCTION BETWEEN STATUTES OF LIMITATION AND STATUTES OF REPOSE. A. Either Congress clearly intended section 9658 to apply to all state limitations periods, or the scope of section 9658 is ambiguous. 1. Congress clearly intended section 9658 to apply to all state limitations periods, with no exception for statutes of repose. In addressing legislative intent, Defendant and the United States (a) have no answer to Plaintiffs primary contention that Congress clearly intended section 9658 to apply to all state limitations periods, and (b) urge the Court to apply a toonarrow conception of the plain meaning rule. 4

13 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 13 of 40 a. Congress clearly intended section 9658 to apply to all state limitations periods. The language and structure of section 9658 reveal a clear intent to reach all state limitations periods. The language in section 9658 is broad, applying to any action brought under State law for personal injury, or property damages, which are caused or contributed to by exposure to any hazardous substance, or pollutant or contaminant, released into the environment. 42 U.S.C. 9658(a)(1). The title is similarly broad: Actions under State law for damages from exposure to hazardous substances. Section 9658(a) is structured to comprehensively address all state limitations periods. Those limitations periods with commencement dates earlier than the Federally Required Commencement Period (FRCP) are preempted by subsection (a)(1), while those without an earlier commencement date are not preempted pursuant to (a)(2). Victims are thus either given the benefit of the FRCP discovery rule or, if the applicable state law does not have an earlier commencement date, then state law applies, which can be no worse for the victim. The broad language and comprehensive context of section 9658 clearly exhibit congressional intent that section 9658 provide all plaintiffs with a commencement date based on the discovery rule, which is entirely inconsistent with a statute of repose that would not even allow claims to commence. 5

14 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 14 of 40 It is immaterial that section 9658 does not use the term statutes of repose as well, despite the arguments by Defendant and the United States. See CTS Br. at 17; US Br. at 11. The United States relies on Black s Law Dictionary to argue that the scope of section 9658 is confined to statutes of limitations and does not encompass statutes of repose. See US Br. at 11. The United States uses the most recent, Ninth Edition of Black s. Id. Let s look instead at the Fifth Edition from 1979, the one in existence when the Study Group met in the early 1980 s and when section 9658 was enacted in See, e.g., United States v. Dodson, 291 F.3d 268, 272 (4th Cir. 2002) (relying on Sixth Edition of Black s, the version available for legislative consultation when Congress drafted the AEDPA ). The Fifth Edition shows that the terms statutes of limitation and statutes of repose were indeed used interchangeably at that time. Black s defined statutes of limitation in relevant part as follows: A statute prescribing limitations to the right of action on certain prescribed causes of action or criminal prosecutions; that is, declaring that no suit shall be maintained on such causes of action, nor any criminal charge be made, unless brought within a specific period of time after the right accrued. Statutes of limitation are statutes of repose, and are such legislative enactments as prescribe the periods within which actions may be brought upon certain claims or within which certain rights may be enforced. In criminal cases, however, a statute of limitations is an act of grace, a surrendering by sovereign of its right to prosecute. Also sometimes referred to as statutes of repose. 6

15 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 15 of 40 Black s Law Dictionary 835 (5th ed. 1979) (emphases added). Not only did the definition for Limitation conflate the two, for Repose statutes, Black s simply, and fully, said: See Limitation (Statute of limitation). Id. at To be fair, later editions began to recognize a difference between the two terms. The Sixth Edition, for example, compared the two terms while also noting that statutes of limitation are sometimes called statutes of repose. Black s Law Dictionary 927 (6th ed. 1990). The Seventh Edition distinguished the terms more distinctly, but also stated, in defining statute of repose, that [u]nlike an ordinary statute of limitations, a statute of repose begins when an event occurs. Black s Law Dictionary 1423 (7th ed. 1999). Thus, as recently as 1999, Black s compared statutes of repose to ordinary statutes of limitation, implying they were a subset of statutes of limitation. Therefore, using Black s Law Dictionary, as the United States urges (though understandably preferring a much later edition), and as this Court has often done, supports the conclusion that the scope of section 9658 clearly encompasses statutes of repose. See, e.g., United States v. Chong Lam, 677 F.3d 190, 202 (4th Cir. 2012) (using Black s Law Dictionary definition to construe plain meaning of spurious in 18 U.S.C. 2320(e)(1)(A); United States v. Harris, 128 F.3d 850, 854 (4th Cir. 1997) (using Black s Law Dictionary definition to construe plain meaning of similar in U.S.S.G. 4A1.2(c)). 7

16 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 16 of 40 Moreover, the lack of the term statutes of repose in section 9658 is unremarkable when other statutes are considered, both federal statutes and the North Carolina statute at issue in this appeal. As noted in Plaintiffs principal brief, no federal statute has ever used the term statute of repose, even though some federal statutes create a statute of repose. See Br. of Appellant at 15. Defendant and the United States have no response. In addition, the North Carolina statute at issue never uses the term repose or statute of repose. See N.C. Gen. Stat. 1-52(16). Section 1-52(16) is contained in the Chapter for Civil Procedure, in the Subchapter for Limitations. See supra at 3. It is contained in the Article for Limitations, Other Than Real Property. Id. The first statute in that Article specifically states, in its entirety, The periods prescribed for the commencement of actions, other than for the recovery of real property, are as set forth in this Article. N.C. Gen. Stat Thus, based on the plain language and context of the statute itself, it is a procedural statute dealing with limitations and the commencement of actions. Therefore, the terms used in section 9658, including applicable limitations period, commencement, and statute of limitations, are all consistent with the terms used in the state statute. There is no reason in hindsight to expect Congress to have also used the term repose, when Congress and state legislatures such as North Carolina s were not using it themselves. See, e.g., Landis v. Physicians Ins. 8

17 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 17 of 40 Co. of Wis., Inc., 628 N.W.2d 893, 896, 907 (Wis. 2001) (noting that The term statute of repose is largely a judicial label for a particular type of limitation on actions and It is apparent that the phrase statute of repose is judicial terminology and is not featured in legislative lingo. ). In conclusion, section 9658 plainly encompasses statutes of repose, and this Court should reverse the District Court s judgment on that basis. b. Defendant applies plain meaning rules too narrowly. Defendant misses the forest (Congressional intent) for the trees (isolated words) in its plain meaning analysis. The very cases Defendant cites hold that the plainness or ambiguity of statutory language is determined by reference to the language itself, the specific context in which that language is used, and the broader context of the statute as a whole. Robinson v. Shell Oil Co., 519 U.S. 337, 341 (1997); see also Holland v. Big River Minerals Corp., 181 F.3d 597, 603 (4th Cir. 1999) ( Our determination of whether a statute is ambiguous is guided by reference to the language itself, the specific context in which that language is used, and the broader context of the statute as a whole. ) (internal quotations omitted). Moreover, Defendant cites Cooper Indus., Inc. v. Availl Servs., Inc., 543 U.S. 157, 167 (2004) for the proposition that fundamental rules of statutory construction... must also be applied in strictly construing the text of CERCLA. CTS Br. at 14 (emphasis added). This argument mischaracterizes the much 9

18 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 18 of 40 narrower holding of Cooper, which was that CERCLA section 113(f)(1) has a plain meaning relating to the issues in that case and that therefore it was unnecessary for the Court to consult CERCLA s legislative history to aid interpretation. Contrary to Defendant s contention, this Court and others have determined that CERCLA, as all remedial statutes, must be given a broad interpretation to effect its ameliorative goals. First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862, 867 (4th Cir. 1989) (emphasis added). As an integral part of the regulatory scheme established by CERCLA, section 9658 should be broadly construed. Freier v. Westinghouse Elec. Corp., 303 F.3d 176, 203 (2d Cir. 2002). In fact, the broad construction due CERCLA was dispositive in the Camp Lejeune litigation. In that ongoing case, the plaintiffs sued the United States for injuries resulting from the contaminated drinking water at the Camp Lejeune Marine Corps Base in North Carolina. JA 267. The Northern District of Georgia held that section 9658 preempted N.C. Gen. Stat. 1-52(16), the exact statute at issue here. JA The deciding factor was that CERCLA, as a remedial statute, should be liberally construed. JA 286 (citing cases from the Second, Third, Fourth, Ninth, Tenth, and Eleventh Circuits for this proposition). The Northern District of Georgia reasoned that statutory language must be read in the context of the purpose it was intended to serve and should not be considered in a vacuum and divorced from its underlying purpose. JA

19 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 19 of 40 (quoting APA Excelsior III L.P. v. Premiere Techs., Inc., 476 F.3d 1261, 1268 (11th Cir. 2007)). Additionally, in all cases of statutory construction, [the court s] task is to interpret the words of the statute in light of the purposes Congress ought to serve. JA 287 (quoting London v. Fieldale Farms Corp., 410 F.3d 1295, 1302 (11th Cir. 2005)). The court acknowledged the balance between having companies not exposed to liability in perpetuity with the sensible notion that people should not have to file suit until they know they have a claim. JA 287. The court concluded, Congress has made the policy decision that in situations covered by the CERCLA statute, plaintiffs should have an opportunity to know they have a case before any state limitations period precludes their claims. JA 288 (emphasis added). Therefore, Defendant s argument that the plain meaning rule limits the court to looking only at isolated statutory words, without reference to context and structure, is contrary to traditional methods of interpretation. The language of section 9658, read within the context and structure of the statute, plainly establishes Congressional intent to fully preempt state limitations provisions. Finally, Defendant incorrectly argues that CERCLA should be strictly construed, when it is well-established that CERCLA should be construed broadly. 11

20 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 20 of Whether Congress intended section 9658 to apply to statutes of repose is at least ambiguous. Alternatively, if the Court decides that Congress did not clearly intend section 9658 to apply to all limitations periods, including statutes of repose, the scope of section 9658 is at least ambiguous. Defendant appears to argue that there was no ambiguity as to whether the term statute of limitations encompassed statutes of repose at the time section 9658 was enacted, the relevant time to consider. See CTS Br. at 23-27; McDonald v. Sun Oil Co., 548 F.3d 774, 780 (9th Cir. 2008) ( [T]he appropriate question is whether statute of limitations was ambiguous when 309 was passed. ). To the contrary, when the Superfund Amendments were enacted in 1986, and long after, there was significant ambiguity regarding whether the term statute of limitations included statutes of repose. See Br. of Appellants at 14; see also Landis, 628 N.W.2d at 907 n.16, 908 (holding phrase [a]ny applicable statute of limitations in statute tolling time limitations when party requested mediation of a medical malpractice dispute was ambiguous when considering whether it tolls an applicable statute of repose, and reasoning that the terms statute of repose and statute of limitations have long been two of the most confusing and interchangeably used terms in the law ). 12

21 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 21 of 40 Indeed, just last year, in a decision otherwise relied on by the government, this Court certified to the Maryland Court of Appeals the question of whether Md. Code Ann is a statute of repose or statute of limitations, noting in its opinion the many conflicting decisions in Maryland state courts over the years. See Anderson v. United States, 669 F.3d 161 (4th Cir. 2011). Defendant relies heavily on Burlington N. & Santa Fe Ry. Co. v. Poole Chem. Co., 419 F.3d 355 (5th Cir. 2005). However, as explained in the Brief of Appellants and below, the claim in Burlington Northern was very different from the latent disease and latent property damage claims addressed in CERCLA. See Br. of Appellants at 28-29; see infra at Moreover, the Fifth Circuit has since stated albeit in a case not involving a statute of repose that CERCLA preemption would apply to plaintiffs who prove their state tort claims arose from a release of hazardous substances into the environment from a facility. Barnes v. Koppers, Inc., 534 F.3d 357, 365 (5th Cir. 2008). Defendant does not dispute that Plaintiffs allegations satisfy all those requirements. See Br. of Appellants at 30. Defendant s contention that there is no ambiguity in section 9658 also ignores the split between the Fifth and Ninth circuits, which is itself some evidence that the statute is ambiguous. See, e.g., Rehab. Ass'n of Va., Inc. v. Kozlowski, 42 F.3d 1444, 1464, 1472 (4th Cir. 1994) (Niemeyer, J., dissenting) (noting circuit 13

22 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 22 of 40 split and reasoning, the fact that the majority opinion and my opinion both of which are purportedly grounded on a rational interpretation of the statutes arrive at significantly different results surely manifests an actual ambiguity and an almost self-evident lack of clarity in the statutes ); see also United States v. Hoang, 636 F.3d 677, 682 (5th Cir. 2011) ( insofar as the reasoning of other circuits may reveal that SORNA is susceptible to more than one accepted meaning, the question of whether SORNA applies... is, at best, ambiguous ); In re S. Star Foods, Inc., 144 F.3d 712, 715 (10th Cir. 1998) (circuit split is in itself evidence of ambiguity when statute s meaning is not evident based on the plain language). Moreover, several published district court decisions (as well as the unpublished Camp Lejeune decision) support Plaintiff s position that section 9658 preempts statutes of repose. See Abrams v. Ciba Specialty Chem. Corp., 659 F. Supp. 2d 1255 (S.D. Ala. 2009); A.S.I., Inc. v. Sanders, 835 F. Supp. 1349, 1358 (D. Kan. 2005); Chatham Steel Corp. v. Brown, 858 F. Supp. 1130, 1151 (N.D. Fla. 1994); Buggsi, Inc. v. Chevron U.S.A., Inc., 857 F. Supp. 1427, (D. Or. 1994). In sum, the statutory language, specific context of that language, broader context of the statute as a whole, and case law reveal that section 9658 is at least ambiguous regarding its application to statutes of repose. 14

23 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 23 of 40 B. Legislative history shows that Congress intended that the federally required commencement date preempt all shorter state limitations periods, including statutes of repose. Defendant agrees that when statutory language is ambiguous, courts should use legislative history to interpret the statute. CTS Br. at (citing Stiltner v. Beretta U.S.A. Corp., 74 F.3d 1473, 1482 (4th Cir. 1996) (en banc) ( if the statutory phrase at issue is ambiguous, we may look beyond the language of the statute to the legislative history for guidance ). 1. The legislative intent behind section 9658 was to preempt all state limitation periods that did not include a discovery rule. Defendant argues that [s]ection 9658 s legislative history also evidences Congress intent to only preempt state statutes of limitation. CTS Br. at 27. Instead, a review of the legislative history shows that Congress intended to remedy the problems identified by the congressionally-charged Study Group. In short, the Study Group s Ninth Recommendation, entitled Removal of Obstacles and Barriers to Effective Court Actions for Personal Injuries Resulting from Exposure to Hazardous Wastes, identified statutes of limitations and statutes of repose as barriers to recovery. When Congress adopted section 9658 and the FRCD, it created one uniform discovery rule and stated that it addressed the problem identified by the Study Group. So, CERCLA s federal discovery rule was meant to preempt statutes of limitations and statutes of repose. 15

24 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 24 of 40 First, reviewing the legislative history chronologically, the general purpose behind CERCLA was to ensure those responsible for any damage, environmental harm, or injury from chemical poisons [may be tagged with] the costs of their actions. S. Rep. No , at 6119 (1980). In 1980, Congress enacted CERCLA in response to the health and environmental risks posed by industrial pollution. United States v. Bestfoods, 534 U.S. 51, 55 (1998). In that same year, Congress also established a Study Group to determine the adequacy of existing common law and statutory remedies in providing legal redress for harm to man and the environment caused by the release of hazardous substances into the environment. 42 U.S.C. 9651(e)(1). In 1982, the Study Group issued its report to Congress. It found that there were unreasonable procedural and other barriers to recovery in court actions for personal injuries resulting from exposure to hazardous waste, including rules relating to the accrual of actions. Injuries and Damages From Hazardous Wastes Analysis and Improvement of Legal Remedies 240 (July 1, 1982) [ Study Group Report ]; US Br. at A10. 2 The Study Group found that because many of the hazardous wastes are... substances with delayed impact..., the latency period for the appearance of injury or disease is likely to be extended for thirty years or more and therefore the cause of action will usually be time barred when the 2 This Brief will also cite to the Addendum to the Brief for the United States, when it contains Study Group Report pages cited here. 16

25 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 25 of 40 plaintiff discovers his hurt. Id. at ; US Br. at A Further, the Study Group Report discussed the exact situation alleged in this case, recommending that a former owner may not relieve himself of the liability for injuries caused by hazardous waste nuisance or dangerous conditions on his land by selling the property. Id. at 243; US Br. at A13. In an effort to combat barriers to recovery, the Study Group recommended changes to state laws. The Study Group specifically recommended that the states adopt[] the discovery rule (i.e., that the cause of action accrues from the time the plaintiff discovered or reasonably should have discovered the injury or disease) to combat the fact that the cause of action will usually be time barred when the plaintiff discovers his hurt. Id. at ; US Br. at A It proposed: that all states that have not already done so, clearly adopt the rule that an action accrues when the plaintiff discovers or should have discovered the injury or disease and its cause. The Recommendation is intended also to cover the repeal of the statutes of repose which, in a number of states have the same effect as some statutes of limitation in barring plaintiff s claim before he knows he has one. Id. at 241; US Br. at A11 (emphasis added). Defendant argues that the Study Group separated statutes of limitations from statutes of repose, and that therefore Congress evidenced knowledge of the separate statute of repose but failure to include any reference to them in 9658 can only reasonably be inferred as intentional. CTS Br. at However, the Study 17

26 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 26 of 40 Group, akin to the 1979 Black s Law Dictionary definition quoted above, often used the terms statute of limitations and statute of repose interchangeably and recommended that both be remedied. For example, the Study Group s statement about statutes of repose having the same effect as statutes of limitations was under the subtitle, Statutes of Limitations. Study Group Report at ; US Br. at A The Study Group Report contained no separate heading for statutes of repose. In Appendix B, the Study Group Report also stated, If the injuries are ascertainable after the statute of limitations has run, the action may be barred. The policy of repose expressed in the statute of limitations may be outweighed by the policy affording the plaintiff a just opportunity to vindicate his rights. US Br. at A23 (emphases added). In examining state statutes before discovery rules were widely adopted, Appendix B also noted that [i]n order to effectuate the policy of repose of actions, the traditional rule also held that plaintiff s knowledge of the wrong was immaterial to the running of the statute [of limitations]. Id. at A24 (emphasis added). These multiple statements illustrate that the Study Group did not clearly distinguish statutes of limitations from statutes of repose; often, they were lumped together. Therefore, the Study Group Report demonstrates that Congress did not intend to differentiate between the statutes when drafting section

27 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 27 of 40 The Study Group Report just made it clear that both had the same problematic effect that needed to be remedied. Thus, when passing the remedy, Congress had no reason to remove only one obstacle to recovery, statutes of limitations, and not the other, statutes of repose. As Defendant notes, Congress did not remedy these problems in accordance with the Study Group s recommendation. CTS Br. at 29. It did not wait on the states individually to adopt the discovery rule in place of restrictive statutes of limitation and statutes of repose. Instead, Congress adopted section 9658 as part of the Superfund Amendments in This section created the federally required commencement date, a federal version of the discovery rule the Study Group urged the states to adopt regarding both types of statutes. Congress explicitly intended to address the problem identified in the 301(e) study. H.R. Conf. Rep. No , at 261 (1986) [ House Report ]. The problem was that certain State statutes deprive plaintiffs of their day in court. Id. In the 301(e) study, the Study Group found that statutes of limitations and statutes of repose have the same negative effect of barring plaintiff s claim before he knows he has one. Study Group Report at 241; US Br. at A11. Based on this context, when the House Report noted that certain State statutes deprive plaintiffs of their day in court, it was referring to both statutes of limitations and statutes of repose. House Report at 261 (emphasis added). To address this problem, 19

28 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 28 of 40 Congress intended section 9658 to create one uniform rule, the FRCD, which preempted the problematic effect of statutes of limitations and statutes of repose. Defendant wants this Court instead to believe that, in certain State statutes, the certain modifies only statutes and reveals that Congress meant to preempt only statutes of limitation and not statutes of repose, but the more obvious interpretation is that certain in the House Report modifies State statutes and refers to those State statutes, whether statutes of limitation or statutes of repose, that deprived plaintiffs of their day in court. Defendant also argues that statutes of limitations are procedural while statutes of repose are substantive. CTS Br. at (citing First Methodist, 882 F.2d at ). There is no evidence the Study Group recommended that Congress base its remedy on such a distinction, as it addressed them both under the heading Statutes of Limitation as rules relating to the time of accrual of actions. Study Group Report at 240; US Br. at A10. Additionally, in preemption analysis, whether a state statute can be classified as procedural or substantive is immaterial. See Jones v. United States, 789 F. Supp. 2d 883, 890 (M.D. Tenn. 2011); Zander v. United States, 786 F. Supp. 2d 880, 885 (D. Md. 2011). Defendant further argues that CERCLA only alters commencement dates and not statutes of repose. CTS Br. at (citing German v. CSX Transp., Inc., 510 F. Supp. 2d 630, (S.D. Ala. 2007)). However, both section 9658 and 20

29 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 29 of 40 the state statute at issue contradict that argument. Section 9658 defines commencement date as the date specified in a statute of limitations as the beginning of the applicable limitations period. 42 U.S.C. 9658(b)(3). The state statute at issue in this case, section 1-52(16), is contained in a statute of limitations. See supra at 3. Moreover, by providing that no action can accrue more than ten years after a defendant s last act or omission, the statute also can be viewed as providing a last possible beginning of the applicable limitations period. In addition, the first statute in Article 5, which contains section 1-52(16), provides that periods prescribed for the commencement of actions, other than for the recovery o real property, are set forth in this Article. N.C. Gen. Stat (emphasis added). Thus, even if section 9658 only addresses the commencement date in statutes of limitations, it preempts section 1-52(16). In sum, the legislative history illustrates that Congress intent in enacting section 9658 was to solve the problem identified by the Study Group. The problem was that plaintiffs were being deprived of their day in court before they knew they had been hurt, by statutes of limitations and statutes of repose. Further, any differences between statutes of limitations and statutes of repose are irrelevant to a preemption analysis. Finally, the context of N.C. Gen. Stat. 1-52(16) shows that Congress did preempt the statute because it is contained in a statute of limitations and provides a commencement date by which the limitations period has to begin. 21

30 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 30 of 40 Thus, the legislative history shows that in section 9658 Congress intended to create a uniform rule preempting statutes of limitations and statutes of repose. 2. Other courts considering congressional intent have concluded that section 9658 preempts statutes of repose. The Ninth Circuit decided this exact issue with facts closely analogous to the case at hand, in McDonald v. Sun Oil, Co., 548 F.3d 774 (9th Cir. 2008). Defendant incorrectly states that a Fifth Circuit case has decided the precise issue in this case. See CTS Br. at 19 (relying on Burlington Northern). In fact, the Fifth Circuit did not decide this precise issue because that case did not involve a latent toxic tort action. In McDonald, Sun Oil Company sold property to the plaintiffs in 1973 and represented that the calcine deposits left on the property were not contaminated with mercury. 548 F.3d at The plaintiffs discovered mercury contamination when the Oregon Department of Environmental Quality investigated the deposits in Id. at 778. The plaintiffs sued Sun Oil Company for negligence, and the Ninth Circuit ruled that CERCLA section 9568 preempted Oregon s ten-year statute of repose. Id. at Here, similarly, Defendant sold the land in 1987, JA 13 26, representing that the land has been rendered in an environmentally clean condition. JA Plaintiffs first discovered that their air, land, and water were contaminated by TCE and other toxic chemicals in JA ,

31 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 31 of 40 The EPA notified Plaintiffs that their well water was not fit for human consumption, and within two years, Plaintiffs sued Defendant for a state tort. JA 15 35, 37. Thus, McDonald dealt with the precise issue in this case environmental damage not discovered until after the state statute of repose ran. On the other hand, in Burlington Northern, a storage tank ruptured, releasing several hundred thousand gallons of chemicals onto the plaintiff s property and a railroad right-of-way. 419 F.3d at 358. Immediately after, the defendant and the fire department conducted emergency response services. Id. The plaintiff conducted its own emergency clean-up and restoration, suing the defendant for the costs. Id. Because the defendant did not have insurance coverage, the plaintiff brought suit against the storage tank manufacturer. Id. The plaintiff knew about its injury as soon as the tank ruptured. Id. at 365. So, the issue Congress was trying to combat with section 9658 instances where the plaintiff s claims are barred by state limitations periods before he discovers the environmental damage was not present in Burlington Northern. The Fifth Circuit even noted that this case does not involve the delayed discovery for which 9658 was intended to address. The case does not implicate a long-latency disease or involve a situation where the time for filing a claim expired before the plaintiff learned that a hazardous substance caused his injury. Id. at

32 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 32 of 40 In addition to the factual differences, the reasoning in McDonald is more persuasive than the reasoning in Burlington Northern. In McDonald, the court first concluded that the term statute of limitations in section 9658 was ambiguous as to whether the section also preempted statutes of repose. 548 F.3d at 781. It noted that the terms were used interchangeably in 1986, which the Black s Law Dictionary definition from 1979 confirms. Id. Based on this ambiguity, the court examined Congressional intent in passing section 9658 and concluded that: Congress s primary concern in enacting 9658 was to adopt the discovery rule in situations where a plaintiff may lose a cause of action before becoming aware of it.... This predicament can be caused by either statutes of limitation or statutes of repose, and is probably most likely to occur where statutes of repose operate. Id. at 783. Thus, the Ninth Circuit concluded that section 9658 created a uniform rule preempting all state limitations periods. Id. at 779. Other courts have found this reasoning persuasive and have held that CERCLA s discovery rule in section 9658 preempts statutes of limitations and statutes of repose. See A.S.I., Inc., 835 F. Supp. at 1358 (holding that [a]pplied here, the federal statute would preempt the application of the 10-year statute of repose, since that statute does not allow for discovery of the injury ); Chatham, 858 F. Supp. at 1151 (ruling that CERCLA preempted a statute of repose because these state statutes stand as obstacle to the liability provisions of CERCLA and hinder the achievement of the statute s goals ); Buggsi, Inc., 857 F. Supp. at

33 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 33 of (holding that CERCLA preempted a state statute of repose in order to allow the plaintiff time to discover the property damaged caused by the hazardous substance, pollutant, or contaminant). Defendant does not acknowledge these additional authorities and instead attempts to distinguish only Abrams v. Ciba Specialty Chem. Corp., 659 F. Supp. 2d 1255 (S.D. Ala. 2009). In Abrams, the plaintiffs property was damaged by the defendant s release of DDT. Id. at That court s analysis of Congressional intent is instructive to the issue at hand, even though Alabama had a common law period of repose instead of a statute of repose. Id. at It noted that Congress enacted section 9658 to provide a remedy for victims who could lose their cause of action before even discovering the damage. Id. at Therefore, [t]hose policy justifications underlying 9658 fit plaintiff s claims against [defendant] like a glove. Id. The court concluded that: The statutory ambiguity concerning the phrases applicable limitations period and or under common law is to be resolved in a manner that is deferential to the remedial purposes and liberal construction which CERCLA is owed, as well as the clear intent of Congress to avoid bouncing people like the [] plaintiffs out of court simply because they failed to discover the environmental contamination on their properties in time. Id. at

34 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 34 of 40 The analyses in the cases cited above are persuasive because they, unlike Burlington Northern, dealt with the precise issue in this case. They recognized ambiguity in the scope of section 9658, reviewed the legislative intent, and concluded that Congress intended section 9658 s discovery rule to apply to statutes of limitations and statutes of repose that would bar plaintiffs claims. C. The District Court s construction would lead to absurd results. Alternatively, construing section 9658 not to apply in all state cases involving the release of hazardous substances leads to an absurd result. Defendant s construction of section 9658 would frustrate the Congressional purpose in enacting the statute, which was to solve the problem of plaintiffs being deprived of their day in court before they even knew of their harm. Interpreting section 9658 to provide a discovery rule and commencement date for plaintiffs with claims involving the release of hazardous substances only in states with statutes of limitation, and not also in states with statutes of repose, would frustrate that purpose in many states. Plaintiffs in those states would continue to be deprived of their day in court, without the opportunity for valid claims to ever accrue, and section 9658 s reach would be severely limited, despite it being a remedial statute that should be construed broadly. Where the literal reading of a statutory term would compel an odd result, Green v. Bock Laundry Mach. Co., 490 U.S. 504, 509 (1989), a court should search for other evidence of congressional intent to lend the term its proper scope. 26

35 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 35 of 40 Pub. Citizen v. U.S. Dept. of Justice, 491 U.S. 440, (1989); see also FDIC v. Phila. Gear Corp., 476 U.S. 426, 432 (1986); Watt v. Alaska, 451 U.S. 259, 266 (1981) ( The circumstances of the enactment of particular legislation... may persuade a court that Congress did not intend words of common meaning to have their literal effect. ). Thus, it is insufficient for Defendant to argue merely that the District Court did not compel an absurd result, without even a cursory examination of whether the impact of that decision runs contrary to the statute s purposes. See CTS Br. at 37. Defendant also argues that there is no evidence that Congress intended to establish through preemption any uniform rule. Id. To the contrary, the United States Supreme Court has recognized a federal interest in uniformity in the application of CERCLA. Bestfoods, 524 U.S. at 63 n.9 (quoting Lansford- Coaldale Joint Water Auth. v. Tonolli Corp., 4 F.3d 1209, 1225 (3d Cir. 1993)). Furthermore, the absurdity of the result Defendant seeks is particularly apparent given the similarity between statutes of limitation without a discovery rule and statutes of repose. See Abrams, 659 F. Supp. 2d at ( Congress s primary concern in enacting 309 was to adopt the discovery rule in situations where a plaintiff may lose a cause of action before becoming aware of it-precisely the type of circumstance involved in this case. This predicament can be caused by either statutes of limitation or statutes of repose, and is probably most likely to 27

36 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 36 of 40 occur where statutes of repose operate. ) (quoting McDonald, 548 F.3d at 783). A statute of limitations without a discovery rule has the same effect as a statute of repose. See, e.g., Boudreau v. Baughman, 322 N.C. 331, 349, 368 S.E.2d 849, 862 (1988) (Webb, J., dissenting) ( Whatever differences we may find in statutes of limitation and statutes of repose, the purpose of both of them is to bar claims which are not filed within certain times. The majority has not said why there should be a different treatment of them because we call one statute substantive and the other procedural. I do not see why we should. ). Without a discovery rule, the time to bring a claim can run before the victim even knows he has a claim (the exact problem identified by the Study Group and in the other legislative history). That is also the exact effect of a statute of repose the time to bring a claim can run even before the victim knows about the possible claim. In other words, the evil the statute addresses by mandating a discovery rule is the same evil of a statute of repose. On that basis, the District Court s determination that Congress intended to preempt one and not the other is an odd interpretation that would compel an odd result. See also United States v. Ron Pair Enters., Inc., 489 U.S. 235, 242 (1989) ( the intention of the drafters, rather than the strict language, controls in those rare cases in which literal application of a statute produces a result demonstrably at odds with drafters intentions). 28

37 Appeal: Doc: 27 Filed: 08/30/2012 Pg: 37 of 40 Finally, Defendant argues that section 9658 exhibits some sort of balancing of interests that was furthered by preemption of statutes of limitation without discovery rules and no preemption of statutes of repose. See CTS Br. at 37. Defendant cites no authority for that argument, and nothing in section 9658 s legislative history supports it. Defendant has simply conjured up a Congressional compromise to limit section 9658 to those states without a discovery rule in their statutes of limitation while not applying it to states with repose periods in their statutes of limitation, failing to solve the problem identified by the Study Group. Similarly, the government has no authority to support its argument that section 9658 represents a balancing of interests. The government relies only on other aspects of CERCLA that did not involve plaintiffs deprived of their day in court before they even knew they had been harmed. See US Br. at Moreover, the government then twice quotes from a dissenting Supreme Court opinion, without acknowledging that it was a dissent. See id. at 27 (quoting Riegel v. Medtronic, Inc., 552 U.S. 312, (2008) (Ginsburg, J., dissenting). In Riegel, the seven-justice majority actually held that FDA pre-market approval requirements preempted common-law claims of negligence, strict liability, and implied warranty. 552 U.S. at 330. The Court specifically noted the broad language Congress used as evidence Congress intended to preempt state law. Id. at 325. Thus, Riegel if anything offers support for Plaintiffs preemption analysis. 29