2. TOO TOXIC? THE CHALLENGE OF NON-STATUTORY ENVIRONMENTAL LIABILITY AT BROWNFIELDS SITES September 2, 2015 – 10:45 am AMY L. EDWARDS, Holland & Knight LLP MICHAEL R. GOLDSTEIN, The Goldstein Environmental Law Firm LOGAN HOLLERS, Bloomberg BNA (moderator)

3. WHAT WE INTEND TO COVER TODAY: BACKGROUND ON THE ISSUE OF NON-STATUTORY ENVIRONMENTAL LIABILITY AT BROWNFIELDS SITES CASE STUDY – VAPOR INTRUSION POTENTIAL SOLUTIONS, FROM A BROWNFIELDS PERSPECTIVE

4. BACKGROUND ON THE ISSUE Acquiring an Impacted Site That Has Caused Injury to Human Health or Economic Loss (Property Damage) Legal Theories of Liability in a Non-CERCLA/Non-RCRA Context (Buying the Instrumentality of Risk as Opposed to a Facility or Site; the Thing “That Is Doing” as Opposed to the Thing “That Is”) – Negligence – Nuisance – Trespass – Strict Liability for Ultrahazardous Activities ESSENCE OF THE PROBLEM: NO STATUTORY DEFENSES FOR NON- STATUTORY LIABILITY

5. KEY LIABILITY ELEMENTS OF CONCERN FOR THE BROWNFIELDS DEVELOPER Duty, Breach, Proximate Cause, Damages All Four Elements Can Be Present at Brownfield Sites Causes of Action Could Have Accrued Does Cause of Action Get Reset When Title Transfers? Are Toxic Tort Claims Evergreen (Everbrown)?

6. NO CLEAR ANSWER IN CASE LAW (But What’s There isn’t Reassuring) New York v. Shore Realty Corp., 795 F.2d 1032 (2 nd Cir. 1985) Developer buys site for residential redevelopment; 700,000 gallons of liquid hazardous waste under various conditions of release and threatened release Under New York law, Shore, as a landowner, is subject to liability for either a public or private nuisance on its property upon learning of the nuisance and having a reasonable opportunity to abate it. Restatement (Second) of Torts § 839 comment d (1979): – [L]iability [of a possessor of land] is not based upon responsibility for the creation of the harmful condition, but upon the fact that he has exclusive control over the land and the things done upon it and should have the responsibility of taking reasonable measures to remedy conditions on it that are a source of harm to others. Thus a vendee... of land upon which a harmful physical condition exists may be liable under the rule here stated for failing to abate it after he takes possession, even though it was created by his vendor, lessor or other person and even though he had no part in its creation. It is immaterial therefore that other parties placed the chemicals on this site; Shore purchased it with knowledge of its condition — indeed of the approximate cost of cleaning it up — and with an opportunity to clean up the site.

7. NO CLEAR ANSWER IN CASE LAW (But What’s There isn’t Reassuring) Adinolfe v. United Technologies Corp., 786 F.3d 1161 (11 th Cir. 2014) – Personal injury and diminution claims could be brought under common law theories of nuisance, negligence, and strict liability without physical incursion by contamination (anticipated contamination sufficient) – No minimum contaminant concentration required – Caveat: Construing Florida law

8. CASE STUDY – VAPOR INTRUSION Personal Injury Claims Property Damage Claims, Including Stigma/Diminution In Property Value Exit Strategy Risk Tenant Concerns

9. SOLUTIONS FROM A BROWNFIELDS PERSPECTIVE TIER 1 – Environmental Insurance – Liability Shields in State Brownfield Agreements – Transactional Mechanisms TIER 2 – “42 U.S.C. § 9601 (40) STRATEGY” Exercise appropriate care with respect to hazardous substances by taking reasonable steps to (i) stop any continuing release; (ii) prevent any threatened future release; and (iii) prevent or limit human, environmental, or natural resource exposure to any previously released hazardous substance Person is in compliance with any land use restrictions established or relied on in connection with the response action at a vessel or facility – Project Design, Engineering, Development, and Construction

10. SOLUTIONS FROM A BROWNFIELDS PERSPECTIVE TIER 3 – Legislation (Florida Model – Property Damage Bar) TIER 4 – Lone Pine Orders – Federal Court vs. State Court