N.J. Dep't of Envtl. Prot. v. Exxon Mobil Corp.

181 A.3d 257, 453 N.J. Super. 272
CourtNew Jersey Superior Court Appellate Division
DecidedFebruary 12, 2018
DocketDOCKET NO. A–0668–15T1 A–0810–15T1
StatusPublished
Cited by46 cases

This text of 181 A.3d 257 (N.J. Dep't of Envtl. Prot. v. Exxon Mobil Corp.) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
N.J. Dep't of Envtl. Prot. v. Exxon Mobil Corp., 181 A.3d 257, 453 N.J. Super. 272 (N.J. Ct. App. 2018).

Opinion

MESSANO, P.J.A.D.

*261*280In 1991, the New Jersey Department of Environmental Protection (DEP) and Exxon Mobil Corporation (Exxon) entered into two administrative consent orders (ACOs), requiring Exxon to remediate polluted sites it owned and operated at the Bayway Refinery in Linden (Bayway) and the Bayonne Facility (Bayonne). In addition to requiring Exxon to pay a civil penalty, the ACOs required the company to: undertake remedial investigations; prepare work plans and feasibility studies; undertake all additional investigations and actions necessary to remediate the sites under DEP's supervision; submit quarterly progress reports; and reimburse DEP for all oversight costs and costs incurred in investigating and responding to Exxon's discharges. See N.J. Dep't of Envtl. Prot. v. Exxon Mobil Corp., 393 N.J. Super. 388, 391-93, 923 A.2d 345 (App. Div. 2007) ( Exxon I ) (providing historical background regarding operation of these two sites and the ACOs).

Under the ACOs, the State of New Jersey reserved its right to recover additional "natural resource damages" (NRD), i.e., compensation for the injury and destruction of natural resources and the public's loss of the use and enjoyment of those resources. In August 2004, DEP filed two complaints against Exxon seeking NRD at Bayway and Bayonne, and asserting claims under the Spill Compensation and Control Act, N.J.S.A. 58:10-23.11 to -23.24 *281(Spill Act), and common law theories of public nuisance and trespass. *262We need not discuss in detail pretrial rulings and controversies, except to note that in 2006, the trial court granted DEP summary judgment holding Exxon was strictly liable for NRD and restoration costs under the Spill Act. It also dismissed DEP's NRD claim for "loss of use damages." We granted DEP leave to appeal-Exxon did not seek interlocutory review-and, in Exxon I, 393 N.J. Super. at 410, 923 A.2d 345, we reversed and restored DEP's claim for "loss of use" NRD damages. In New Jersey Department of Environmental Protection v. Exxon Mobil Corp., 420 N.J. Super. 395, 397-98, 22 A.3d 1 (App. Div. 2011) ( Exxon II ), we reversed the trial court's dismissal of DEP's strict liability claim, which was added in an amended complaint, on statute of limitations grounds. In 2014, Judge Michael J. Hogan presided over a sixty-six day bench trial.

Both DEP and Exxon moved pre-trial to bar the testimony of all or most of their adversaries' experts. Rather than conduct pre-trial hearings to determine admissibility, see N.J.R.E. 104(a), with the judge's approval, all experts testified while the parties preserved their objections. Utilizing a complex, mathematical methodology known as "Habitat Equivalency Analysis" (HEA), DEP's experts estimated that NRD damages at both sites totaled $8.9 billion. Exxon's experts challenged the admissibility of any opinions based on HEA in the first instance, although, as Judge Hogan noted in his written decision, Exxon's experts, utilizing HEA, estimated NRD damages to be between $1.4 and $3 million.1

*282After two days of summations and the submission of written closing arguments, Judge Hogan set about to render a written decision on the reserved N.J.R.E. 104(a) motions and the case in chief. Before he did, however, the parties advised they had reached a settlement.

Under the terms of the proposed consent judgment, Exxon agreed to pay $225 million to the state treasurer, and the State agreed to place that money in a segregated account within the Hazardous Discharge Site Cleanup Fund, where the monies "shall earn interest and may not be used for any purpose" until the consent judgment "becomes final and non-appealable." The State also agreed to: release Exxon from all NRD claims based on the discharge of contaminants onto the soil and sediments of Bayway and Bayonne; dismiss surface water NRD claims without prejudice to raising them, under certain conditions, in a future action; release Exxon with prejudice and covenants not to sue for all NRD claims relating to more than one thousand Exxon retail gas stations in New Jersey, excluding those where methyl tertiary butyl ether (MTBE)2 had been discharged; release Exxon with prejudice from all NRD claims relating to sixteen other statewide facilities (designated as *263Attachment C facilities), including the former Paulsboro Terminal, which had been the subject of ongoing litigation since 2007, but excluding those facilities where MTBE had been discharged; and defer the final remedy determination and remediation of Morses Creek near Bayway until Exxon ceased refining operations at the site.

The parties further agreed that: the consent judgment would not alter, suspend, or otherwise impact Exxon's obligations under any ACO, except for the Morses Creek deferral; the State would retain full authority and sole discretion to require Exxon to take any action to "address an immediate environmental concern, an *283imminent and substantial endangerment to public health, welfare or the environment, or an emergency response arising from or related to" Bayway, Bayonne, the gas stations and Attachment C facilities; and, the court would retain continued jurisdiction and enforcement of the consent judgment's terms. Lastly, the consent judgment declared that nothing contained therein "shall be considered an admission by [Exxon]," and it granted Exxon contribution protection "to the fullest extent possible" pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. §§ 9601 - 675, the Spill Act, and any other statute, regulation, or common law principle that allowed contribution rights against Exxon.3

DEP provided notice of the proposed consent judgment in accordance with N.J.S.A. 58:10-23.11e2. See Cumberland Farms, Inc. v. N.J. Dep't of Envtl. Prot., 447 N.J. Super. 423, 441, 148 A.3d 767 (App.

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Bluebook (online)
181 A.3d 257, 453 N.J. Super. 272, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nj-dept-of-envtl-prot-v-exxon-mobil-corp-njsuperctappdiv-2018.