LA District Court Holds that Spill and Release of Crude Oil from the Deepwater Horizon Well Did Not Trigger EPCRA Reporting Requirements

On September 11, 2015, the United States District Court for the Eastern District of Louisiana issued a significant ruling holding that CERCLA’s “Petroleum Exclusion” applies to the release of crude oil and any quantities of benzene, toluene and xylene present in this crude oil resulting from the Deepwater Horizon oil spill of April 20, 2010.  Accordingly, the spill reporting requirements of the Emergency Planning and Community Right-to-Know Act of 1986 (EPCRA) were not triggered by this spill.  The case is In Re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on July 20, 2010.

Following the spill, the Center for Biological Diversity filed a citizen suit against BP America Production Co. and Transocean Offshore Deepwater Drilling, et al., alleging violation of the Clean Water Act (CWA), Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), and EPCRA, which the court dismissed for lack of standing, mootness and a failure to state a claim for relief.

On appeal, on January 9, 2013, the U.S. Court of Appeals for the Fifth Circuit sustained most of the lower court’s holdings, but remanded the EPCRA claim for further proceedings, Center for Biological Diversity, Inc., v. BP America Production Co., et al., 704 F.3d 413 (5th Cir. 2013). The Court of Appeals ruled that EPCRA, unlike CERCLA, requires timely reporting of covered releases of covered substances to assure that the public as well as government authorities are given access to important information.  On the record before it, the Court of Appeals could not conclude that the matter was moot.

On remand, the lower has now ruled that the release reporting provisions of EPCRA do not apply to spills or releases of crude oil.  EPCRA, which is codified at 42 U.S.C. §§ 11001-11050, derives its reporting requirements from CERCLA, which in turn specifically excludes the release of “petroleum, including crude oil or any fraction thereof which is not specifically listed or designated as a hazardous substance…” from CERCLA’s definition of “hazardous substance”.  See 42 U.S.C. § 9601(14).  The court agreed with BP that the plain meaning of the statute, EPA’s long-time interpretation of the petroleum exclusion, and relevant case law compel the conclusion that this massive spill of crude oil was not subject to EPCRA.  In addition, the plaintiffs had argued that BP’s use of drilling fluids in its attempt to stop the flow of oil vitiated the petroleum exclusion, but the court ruled that since EPA’s hazardous waste management rules exclude drilling fluids from the  definition of hazardous waste, this also excludes drilling fluids from the ambit of substances covered by EPCRA in this case.