Developers subject to the Federal Power Act (FPA) should carefully consider the implications of the U.S. Court of Appeals for the District of Columbia Circuit’s recent opinion on the scope of the “municipal preference” under Section 7(a) of the FPA. The Court, in Western Minnesota Municipal Power Agency, et al., v. FERC, recently considered the breadth of the “municipal preference” in Section 7(a) of the FPA, including the meaning of “municipality,” and declined to support the Federal Energy Regulatory Commission’s “geographic proximity test” for municipalities to qualify for the preference. Under the Court’s ruling, a municipality qualifies for the municipal preference regardless of their proximity to the location of the development. Developers may now be exposed to greater competition for developments with municipalities having a trump card because they qualify for the municipal preference. As one would hope, the Court of Appeals restated the importance of the Court’s review FERC’s interpretation under the two-step framework of Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837, 842–43 (1984). The opinion, of course, also reflects the Supreme Court’s use of Chevron in deciding a number of important cases the past two terms. This opinion may also result in FERC being more careful in the future.
A U.S. District Court for the District of Columbia has joined the debate regarding whether the U.S. Fish and Wildlife Service is required to comply with the National Environmental Policy Act, 42 U.S.C. §§ 4321–4347 (NEPA), when designating critical habitat based upon the requirements of the Endangered Species Act (ESA). A geographically based distinction in agency policy has resulted from a split in the U.S. Courts of Appeals on the question of whether an environmental impact statement (EIS) is required for critical habitat designations. The Tenth Circuit Court of Appeals, in Catron County Board of Commissioners, New Mexico, v. United States Fish and Wildlife Service, et al., 75 F.3d 1429, 1436 (10th Cir. 1996), held that the Fish and Wildlife Service must comply with NEPA when designating critical habitat under the ESA. 75 F.3d at 1436. By contrast, the Ninth Circuit, in Douglas County v. Babbitt, et al., 48 F.3d 1495, 1502-07 (9th Cir. 1999), held that the Fish and Wildlife Service does not have to comply with NEPA when designating critical habitat. NEPA is generally understood to be a “procedural statute” that is designed to ensure that federal agencies make fully informed and well-considered decisions. While the U.S. Court of Appeals for the District of Columbia circuit has not had an occasion to rule on this NEPA issue, on November 13, 2015, the U.S. District Court for the District of Columbia issued a Memorandum Opinion agreeing with the Ninth Circuit that NEPA is not applicable to critical habitat determinations. The case is Otay Mesa Property, L.P., v. United States Department of the Interior. Continue reading
In Sixth Circuit Rejects Clean Air Act Preemption of State Common Law Claims: Four Things to Know, Pillsbury attorneys Matt Morrison and Bryan Stockton explore the Six Circuit Court of Appeals recent rejection of Clean Air Act, 42 U.S.C. §§ 7401 et seq. (CAA), preemption of state common law claims in Merrick, et al. v. Diageo Americas Supply, Inc. and Little et al. v. Louisville Gas & Electric Company; PPL Corporation. The takeaway is that a facility that is otherwise in compliance with CAA emission requirements can still face lawsuits by neighboring landowners for traditional torts such as nuisance and trespass. Merrick and Little add to the foundation of precedent across the Second, Third, and Sixth Circuits, and Iowa Supreme Court.
The “Conflicts Minerals” rule was enacted, with very little debate, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. This rule places new regulatory requirements on the nation’s financial system in the wake of the 2008 economic emergency. To many observers, the most troublesome aspect of the rule involves the federal government’s authority to compel the regulated community—in this instance, companies that may have some connection to the civil wars in the Congo—to label what they do in censorious terms as part of public SEC filings. In particular, the SEC’s conflict minerals rule purports to compel certain disclosures affecting the acquisition of certain minerals produced in the Democratic Republic of the Congo. How far can the government go, consistent with the First Amendment, to require companies and corporations to say what the government rules that that must say?
Early this year, Governor Andrew M. Cuomo signed a bill requiring assessors and contractors in the mold remediation industry to be licensed and their workers properly trained, effective January 1, 2016. The bill was amended later in the year, but the date it goes into effect remains the same. The new law requires the licensing of assessors, contractors and workers, and a written mold remediation plan, prepared by a licensed mold assessment contractor, to ensure the proper remediation of mold. Additional information about the Mold Program is available on the New York State Department of Labor’s website.
Additional Source: January 2016, New Hampshire Will Require Mold Assessment Certification
Just in time for the holidays, the Nevada State Contractors Board has issued an Industry Bulletin confirming that, beginning this week, it will begin issuing a one-time refund check to eligible licensed contractors as of June 30, 2015. It will disburse approximately $2.6 million in excess funds to nearly 15,000 current active and inactive licensees on a pro-rata basis of their license fees paid over the past 5 years. It confirmed that contractors who have maintained an active or inactive license over the past 5 years with no lapse are expected to receive an estimated refund between $39 and $198.
A California contractor’s bond is a requirement for the issuance of an active license, reactivation of a license, and for the maintenance of an actively renewed license. Effective January 1, 2016, the required amount of a contractor’s bond will increase from $12,500 to $15,000, as a result of California Senate Bill 467 (Hill). As a condition precedent to the issuance, reinstatement, reactivation, renewal, or continued maintenance of a license, SB 467 requires the Contractors State License Board to require the applicant and/or licensee to file or have on file a contractor’s bond in the sum of $15,000. Contractors should contact their bond agent or broker, or existing bond company for guidance on increasing their bond amount to comply with this new requirement. In addition, we expect the CSLB to provide further instructions on contractor’s compliance obligations in the coming months.
Additional Source: CSLB, Bond Requirements
Recently the Third Circuit delivered an important message: Exploiting the permitting process to obstruct competitor growth will not shield one from antitrust claims. In mid-November, the Third Circuit considered whether a party can suffer an antitrust injury when a competitor uses the governmental permitting process to “frustrate the entry” of the competitor into the marketplace. Hanover 3201 Realty, LLC, v. Village Supermarkets, Inc., et al. is a case involving a developer’s antitrust claims premised on numerous administrative and court challenges to its permit applications. Vacating the lower court’s ruling, in part, the Court of Appeals concluded that the District Court’s view of antitrust injury was too narrow and that Hanover “can establish that its injury was ‘inextricably intertwined’ with Defendants’ anticompetitive conduct.” The Court of Appeals also held that Hanover sufficiently alleged that the defendants activity “was undertaken without regard to the merits of the claims and for the purpose of using the governmental process to restrain trade.” Accordingly to the Court of Appeals, Hanover can demonstrate that the defendants are not protected by Noerr-Pennington immunity because their conduct falls within the exception for sham litigation. See E. R.R. Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961); United Mine Workers of Am. v. Pennington, 381 U.S. 657 (1965).
Contractors should beware that the Sixth Circuit’s guidance on CERCLA-related topics continues to be murky, including, in particular, what constitutes a CERCLA settlement triggering the running of the 3-year limitations period for contribution claims. On November 5, 2015, the U.S. Court of Appeals for the Sixth Circuit issued a ruling in the case of Florida Power Corp., dba Progress Energy Florida, Inc., v. FirstEnergy Corp., interpreting two Administrative Orders by Consent for Remedial Investigation/ Feasibility Study (AOCs). The Court of Appeals held that the AOCs were not CERCLA settlements and, as a result, Florida Power’s contribution claims were not untimely. There is a significant dissent in this case, and all of the judges appear to agree that the Sixth Circuit’s decisions in this area have not provided adequate guidance to the regulated community.
Contractors employing workers that perform work outside have long known the importance of addressing outdoor heat hazards in their Injury and Illness Prevention Programs (IIPP). A recent ruling by the California Occupational Safety and Health (DOSH or Cal/OSHA) Appeals Board should serve as a reminder that, at least in California, an employer’s responsibility isn’t limited to the Great Outdoors—the less-great indoors have heat hazards that must be addressed, as well. The Appeal’s Board recently ruled in favor of the Cal/OSHA 2012 citations against two employers premised on their IIPP and related training program failing to effectively address the hazards of indoor heat. The Appeals Board’s ruling affirms that the IIPP standard is not limited to outdoor heat hazards and all employers have a responsibility for ensuring compliance with all Cal/OSHA standards, not just the employer in charge of the worksite. According to the Appeals Board, contractors’ IIPPs and related employee training programs must cover both outdoor and indoor heat hazards.