July 29, 2024

District Court Excludes Tribal Service Losses from NRD Claim – A Broader Sign of Things to Come?

The Federal District Court for the Eastern District of Washington recently barred tribal trustees from recovering CERCLA natural resource damages for “cultural” or “tribal” services, raising questions about exactly which services trustees can recover for.

CERCLA authorizes federal, state, and tribal trustees to recover “damages for injury to, destruction of, or loss of natural resources.” 42 U.S.C. § 9607(1)(4)(C). The statute does not specify how to calculate damages. But the Department of Interior’s NRD assessment regulations do specify several methods that can be used. See 43 C.F.R. § 11.83(c). And, in practice, Trustees use a variety of these methods to measure service losses. 

For example, Trustees often claim damages associated with lost recreational fishing opportunities. To value those claims, they use economic models (travel cost and benefits transfer models, among others) to estimate the additional cost that anglers incur to use a substitute fishery in lieu of a fishery that has been impaired by CERCLA releases. Maybe those anglers drive to farther-away substitute fisheries, incurring more travel time and expense. Or maybe they forego fishing entirely. The key point is that Trustees claim the aggregate cost incurred by those anglers as damages, not the cost to restore the fishery or otherwise repair the injury to the fish themselves.

Pakootas v. Teck Cominco Metals, Ltd., No. 2:04-CV-00256-SAB, 2024 WL 457769 (E.D. Wa. Feb. 6, 2024).

In the latest iteration of the 20-year dispute regarding contamination in the Upper Columbia River, the Confederated Tribes of the Colville Reservation, as Tribal trustee, claimed that slag releases from Teck’s smelter in Trail, British Columbia, natural resources associated with the river. Those injuries—in the form of slag on beach areas, for example—allegedly caused Tribal members to forego certain cultural practices. As damages, the Tribe offered expert testimony on the actions necessary to restore lost or damaged cultural practices, which included monitoring the river, removing slag deposits, implementing cultural programs, and acquiring land.

Teck moved for partial summary judgment arguing, among other things, that “cultural resources are not recoverable ‘natural resources’ under CERCLA” and therefore that the Tribal trustee could not recover damages associated with tribal service losses. The Court agreed, observing that CERCLA defined natural resources as including “[s]urface water resources, ground water resources, air resources, geologic resources, and biological resources.” Order at *4. The Court also noted neither CERCLA, Interior’s regulations, or case law recognized a claim for “cultural” or “tribal service” damages. Id. at *5. But, on denial of a motion for reconsideration, the Court certified the question for interlocutory appeal to the Ninth Circuit.

Does Pakootas Jeopardize Other Trustee Service Loss Claims?

If the Court is correct and trustees cannot recover for lost cultural or tribal services, it raises the question whether trustees can recover for service losses. That is, the Court’s observation that cultural and tribal resources are not among the natural resources that CERCLA identifies (e.g. surface water resources) applies equally to services that Trustees have calculated damages for in other cases. 

For example, and as discussed above, Trustees determine damages associated with lost fishing resources by putting a price on the recreational services that the fishery provided to anglers. But CERCLA does not identify recreational services as natural resources any more than it identifies cultural or tribal services as natural resources. The same would be true of, say, lost wetland services, which may include the value associated with the ability of wetlands to filter contamination. Under the Pakootas court’s reasoning, the cost of increasing stocks of fish or restoring wetlands might be a recoverable, but the aggregate travel-related damages to anglers or the lost value of the service that the wetland provided would not be.

The Pakootas decision may indicate that courts are willing to parse NRD claims carefully, excluding damages that are not directly tied to the lost natural resources. And, if the Ninth Circuit affirms, it may mean that Trustee recoveries in NRD cases and settlements may fall dramatically.