State v. HESS CORP.

20 A.3d 212, 161 N.H. 426
Supreme Court of New Hampshire·Decided March 22, 2011·No. 2010-082·Published·Cited by 12 cases

Opinion

20 A.3d 212 (2011)

STATE of New Hampshire
v.
HESS CORPORATION and another.

No. 2010-082.

Supreme Court of New Hampshire.

Argued: November 10, 2010.
Opinion Issued: January 28, 2011.
As Modified on Denial of Reconsideration March 22, 2011.

*213 Michael A. Delaney, attorney general (Mary Maloney, assistant attorney general, on the brief), Sher Leff, LLP, of San Francisco, California (Victor M. Sher on the brief), Law Offices of Matthew F. Pawa, P.C., of Newton Centre, Massachusetts (Matthew F. Pawa and Benjamin A. Krass on the brief, and Mr. Pawa orally), for the plaintiff.

Beveridge & Diamond, P.C., of Washington, D.C. (John S. Guttmann and Nessa E. Horewitch on the brief, and Mr. Guttmann orally), and Devine, Millimet & Branch, P.A., of Concord (Peter G. Beeson on the brief), for the defendants.

DUGGAN, J.

This case comes before us on an interlocutory transfer without ruling from the Superior Court. See Sup.Ct. R. 9. We accept the facts as presented in the interlocutory transfer. See In re Kotey M., 158 N.H. 358, 359, 965 A.2d 1146 (2009).

In 1991, New Hampshire applied to the United States Environmental Protection Agency's (EPA) reformulated gasoline (RFG) program. The RFG program, which set specifications for formulating gasoline sold in metropolitan areas with high summertime ozone levels, was established by a 1990 amendment to the Clean Air Act and was intended to reduce vehicle-related air pollution. The program did not require gasoline manufacturers to utilize any specific oxygenate in reformulating their products. Instead, that decision was left to individual manufacturers.

Although not required to participate in the RFG program, New Hampshire decided to "opt-in." The EPA accepted New Hampshire's application—effective January 1, 1995—for Rockingham, Hillsborough, Merrimack and Strafford Counties. Thereafter, between 1995 and 2006, gasoline *214 containing methyl tertiary butyl ether (MTBE), which is a chemical compound that has been used as a gasoline additive to increase octane levels of fuel, was sold throughout the state. During this time, the State alleges that MTBE, which it asserts is a known animal carcinogen and probable human carcinogen, escaped into, and contaminated, the groundwater. In 2001, the State petitioned the EPA to opt-out of the RFG program on an expedited basis because of MTBE contamination, and then banned MTBE as a gasoline additive effective January 1, 2007.

The State exercises significant regulatory control over the State's groundwater and drinking water through the New Hampshire Department of Environmental Services (DES) and pursuant to the New Hampshire Safe Drinking Water Act (SDWA). The Commissioner of DES must adopt "primary drinking water standards" for contaminants in drinking water that "may have an adverse effect on the health of persons." RSA 485:3, I(a) (2001). These standards include a maximum contaminant level (MCL), which establishes the maximum amount of a given contaminant that may be present in water for human consumption. RSA 485:3, I(b)(1) (2001). For groundwater, DES must also adopt ambient groundwater quality standards (AGQS) for contaminants that "adversely affect human health or the environment," RSA 485-C:6, I (2001), which must meet drinking water standards, RSA 485-C:1, I (2001). In addition to these standards applicable to all contaminants, the legislature added a section to the SDWA in 1999, which specifically mandates DES to adopt such standards for MTBE. RSA 485:16-a, I (2001).

In 2000, DES, in consultation with the New Hampshire Department of Health and Human Services, established a primary MCL and an equivalent AGQS for MTBE of thirteen parts per billion "based on positive carcinogenic effects observed in experimental animals" reported in the publicly available literature at the time. Additionally, New Hampshire law provides that "[a]ny public water system delivering water with greater than 5 parts per billion of MTBE shall notify each customer of the MTBE content." RSA 485:16-a, II (2001). However, both the MCL for MTBE and the notification requirement apply only to public water systems. RSA 485:3, I,:16-a. The SDWA defines a "public water system" as a "system for the provision to the public of piped water for human consumption, if such system has at least 15 service connections or regularly serves an average of at least 25 individuals daily at least 60 days out of the year." RSA 485:1-a, XV (2001). All other wells, whether privately or publicly owned, that serve more than one individual home but do not qualify as a "public water system" are non-public water systems.

In 2003, New Hampshire and several other states filed suit in their respective state courts against several gasoline suppliers, refiners and chemical manufacturers (MTBE defendants) seeking damages for groundwater contamination allegedly caused by MTBE. The MTBE defendants initially removed New Hampshire's case to federal court, and it was subsequently transferred by the Judicial Panel on Multidistrict Litigation to the Southern District of New York and consolidated with numerous other MTBE lawsuits from around the country. Following the denial of its motion to remand, the State filed an interlocutory appeal with the United States Court of Appeals for the Second Circuit, which reversed and vacated the district court's order in May 2007. See In re Methyl Tertiary Butyl Ether ("MTBE"), 488 F.3d 112 (2d Cir.2007). Thus, this case was remanded to Merrimack County Superior Court for trial.

*215 In the meantime, the cities of Dover and Portsmouth brought their own suits against the MTBE defendants. We affirmed the dismissal of these suits in January 2006. See State v. City of Dover, 153 N.H. 181, 891 A.2d 524 (2006). In that decision, we determined that the State, rather than the two cities, was the proper party to bring suit against the MTBE defendants because it "has a quasi-sovereign interest in protecting the health and well-being, both physical and economic, of its residents with respect to the statewide water supply." Id. at 186, 891 A.2d 524. We also noted that "MTBE contamination has directly affected a substantial portion" of the State's population. Id. at 187, 891 A.2d 524. Accordingly, we held that the State had parens patriae standing to bring suit against the MTBE defendants on behalf of the residents of New Hampshire. Id. at 187-88, 891 A.2d 524.

In August 2009, the MTBE defendants in this case filed a motion for partial summary judgment, seeking to prevent the State from recovering damages

incurred by private individuals or private water supplies, including, but not limited to: (1) damages related to private property; (2) costs of alternative water supplies incurred by private parties; (3) business losses for any private entity; (4) costs of private treatment systems borne by private well owners and private water authorities; (5) increased operating expenses for private water authorities; (6) costs associated with testing/monitoring for MTBE by private parties; (7) costs associated with MTBE remediation at private wells or utilities that were incurred directly by private parties; and (8) any other similar purely private damages.

Additionally, in response to a request from the superior court, the State prov

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