Publications
Product Labeling – Making Sure Green Really is Green
"Greenwashing" is an important liability concern for companies of all kinds that are promoting the eco-friendliness of their wares. The Green Claims Regulations published by the FTC is just one place to start an analysis of whether a claim is unfair or deceptive. This article sets forth some protocols for companies to consider in making sure their claims are defensible.
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Opportunities and Challenges Await Implementation of California’s Green Chemistry Initiative
California has long been viewed as a leader in the development of policies and regulations that create economic development opportunities while enhancing protection of human health and the environment. The new Green Chemistry legislation - supported by industry - was signed into law last year and is a prime example of this kind of leadership. The legislation will ultimately lead to safer and more healthful consumer products of all kinds, and will simultaneously create significant opportunity for entrepreneurs to develop alternatives to some of the most toxic chemicals now in use in industry.
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Supreme Court Cuts Polluters a Break in Cleanup Case
The United States Supreme Court ruled against the federal government and declared that Shell and units of Burlington Northern Santa Fe and Union Pacific do not have to pay for most of the $8 million cost to clean a polluted chemical site in California. Burlington Northern & Santa Fe Railway Co. v. United States, __ S.Ct. __, 2009 WL 1174849 (S. Ct. May 4, 2009). The court agreed that Shell was not responsible for the damage because it had only provided chemicals to the site and had encouraged proper handling. With respect to the railroads, the court found their liability could reasonably be apportioned to just 9 percent.
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California’s framework for growth rests in rules set by AB 32
Long before the dramatic shift in Washington that came with last year's presidential election, the State of California made itself a global leader in climate change with the passage of Assembly Bill 32, the Global Warming Solutions Act of 2006. The law required a reduction in greenhouse gas emissions ("GHGs") to 1990 levels by 2020 through regulations to be implemented by the California Air Resource Board ("CARB"). While some oppose AB 32 based on the costs they think it will impose, climate change regulation is now inevitable at the federal level, and not responding to climate change will cost far more than doing so.
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Policyholders Win Critical Environmental Insurance Case in California Supreme Court
On March 9, 2009, the California Supreme Court delivered a much anticipated decision establishing that in determining coverage for environmental contamination where multiple acts or events have contributed to an indivisible amount of contamination, so long as at least one of the events causing the indivisible harm is a covered event, the insurer must provide coverage for the entire amount. State v. Allstate Ins. Co., Case No. S149988 (Cal. Sup. Ct. March 9, 2009); (2009) 2009 WL 579415.
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Federal green stimulus? Think Transit
The world watched closely Tuesday as the new Obama Administration took office, promising to work quickly with Congress to enact a stimulus package and to reengage in international climate negotiations. Mass transit infrastructure is critical to these goals - for three reasons.
(Download PDF of Point Carbon News or click "read more" below)
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Stacking Insurance Policies - New Landmark Case in California
On January 5, 2009, the Court of Appeal of the State of California, Fourth Appellate District filed a 76-page opinion permitting insurance policyholders to "stack" multiple years of coverage to obtain recovery for a continuous loss. The case arises out of the notorious Stringfellows Acid Pit site where a federal court ordered the State of California to pay for the cleanup of the hazardous waste site; a cost that could be as much as $700 million. State of California v. Continental Ins. Co. (2009) Case No. E041425 (Cal. Ct. App., 4th Dist. January 5, 2009).
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California Environmental Legislation Update 2008
At the close of the recent California legislative session, a slew of new environmental legislation passed. The bills range from placing regional or statewide targets towards reducing greenhouse gas emissions to providing guidelines for implementing cleaner and more sustainable industry. This Quarterly Review provides information and links related to newly enacted environmental bills of 2008.
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AB 32: California’s Framework for Change
Introduction The State of California made itself a global leader in climate change with the passage of Assembly Bill 32, known as the Global Warming Act of 2006.
(Download PDF or click "read more" below)
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The “Innocent Landowner” Defense Proves to be Out of Reach . . . Again
What “innocent landowner” defense? In a recent California case, a developer who unknowingly spread arsenic-contaminated dirt during the construction of a residential project almost thirty years ago was held liable under CERCLA. United States v. Honeywell 542 F. Supp. 2d 1188 (E.D. Cal. 2008).
(Download PDF or click "read more" below)
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“Sustainability” – Buzzword or Legal Duty?
It seems like everyone is talking about “sustainability.” The past few years have been witness to a whirlwind of change in the environmental community. With celebrities driving hybrid cars and Hollywood studios purchasing carbon credits, being green has gone mainstream. In addition, environmental laws regarding climate change and greenhouse gas emissions have been put on the books in California and it looks like federal regulations are soon to follow. Furthermore, the United States Supreme Court has determined that the EPA has the authority to regulate CO2 emissions. So the question arises, is “sustainability” good business sense or is it just another legal requirement? This article, written by two lawyers that recycle, reuse, conserve, compost, and bike to work explores both.
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Recovery of Voluntary Cleanup Costs Under CERCLA – Answers from the High Court
After years of uncertainty on a key issue for environmental lawyers and the clients they represent, the United States Supreme Court in United States v. Atlantic Research Corp., __ U.S. __, 127 S. Ct. 2331 (2007) recently held that a potentially responsible party (“PRP”) may recover costs it incurs in responding to environmental contamination from other PRPs under CERCLA section 107(a). The decision is important as it finally provides answers to questions that were left open by the High Court’s decision in Cooper Industries v. Aviall Services, Inc., 543 U.S. 157 (2004). Namely, can a PRP who incurs “voluntary” cleanup costs recover those costs from other PRPs under CERCLA? The Court said that it can.
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Insurance Archaeology: Looking for Buried Treasure
Lawyers and the businesses they represent often get so involved in defending claims that the availability of historic insurance policies to help defray the costs of defense is not given the attention it deserves. Even when a search for historic insurance policies is commenced, it is often called off too early, especially considering the value of such policies. The search for and analysis of historic insurance policies is often called “insurance archaeology.” Like the traditional archaeologist, the insurance archaeologist digs for evidence – much of it easily passed over by the untrained eye – and painstakingly assembles it to reconstruct a picture of the past – in this case, a business’ insurance coverage from decades ago.
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When Best Management Practices Aren’t Enough – Environmental Laws, Insurance, and the Metal Finishing Industry
So, you’ve taken over dad’s plating company and you think that as long as you maintain good environmental business practices, you’re not at risk of environmental enforcement. WRONG. Even if the regulators say you have the cleanest shop they’ve ever stepped into, you may be liable for spills that took place decades ago.
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Looking for Buried Treasure – 40-Year Old Insurance Policies Could Be Worth Millions
GOTCHA! The garment cleaning industry is on the “most wanted” list for environmental violations and a favorite target among regulators and private parties seeking millions in damages. More often than not, the industrial laundries and dry cleaners become so involved in defending such claims that the availability of historic insurance policies to help defray the costs of defense is not given the attention it deserves. Most people assume that a general liability insurance policy they purchased 40 years ago has expired. Not true! Indeed, historic insurance policies never expire and could be worth millions!
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Affirmative Defense for Setoff Could Constitute “Suit” Triggering Insurer’s Duty to Defend
A California Court of Appeals recently found that an affirmative defense seeking a setoff could be the functional equivalent of a “suit” seeking damages within the standard duty-to-defend provisions in a comprehensive general liability policy (“CGL”). The decision in CDM Investors v. Travelers (2006) 139 Cal. App. 4th 1251, refines the literal approach adopted in Foster-Gardner, Inc. v. National Union Fire Ins. Co. (1998) 18 Cal. App. 4th 857. A petition for review has been filed.
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Contaminated Collateral - 40 Year Old Insurance Policies Could Be Worth Millions
Most banks and financial institutions are loathe to admit it, but their portfolio of properties and loans include properties that are or may be environmentally impaired. If the borrower defaults on the loan, the bank will face the unsettling prospect of foreclosing on the contaminated collateral or even foregoing its security. In other cases, the bank may be a current or former owner of the property. Whatever the scenario, there are economical steps that should be taken now to protect the value of your collateral and avoid, or at least minimize, your institution’s potential liability. Indeed, the proactive identification of historical insurance assets could save you millions of dollars on attorneys, environmental consultants, and lost collateral.
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Back from the Dead – Suing dissolved corporations and deceased individuals
Did you know that companies that have dissolved or gone bankrupt can still have claims brought against them? What about actions against the dearly departed? While it may seem counter-intuitive to sue a dissolved corporation or a deceased individual (hearken back to the proverbial phrase “you can’t squeeze blood from a turnip”), claims against such entities are viable under California law.
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"Ultimate Net Loss" after Powerine - Another Victory for Policyholders
The California Supreme Court recently handed down an important victory for policyholders in Powerine Oil Co., Inc. v. Superior Court (2005) 37 Cal. App. 4th 377 (“Powerine II”). In Powerine II, the Court held that “standard” excess/umbrella liability policies include potential coverage for environmental cleanup and response costs ordered by an administrative agency. While the case is particularly pertinent to companies facing administrative cleanup and abatement orders, it could have significant widespread application to umbrella policyholders facing “long-tail” liability.
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The Document Retention Policy Fallacy
DO NOT throw away old insurance policies. Now days, many accountants are advising their clients to destroy records after a certain number of years. But this advice could cost your clients millions in lost insurance coverage. Instead, accountants should qualify any advice with respect to destruction of records so that their clients understand to retain all evidence of historical insurance coverage. While there may be good reasons to destroy old documents, an exception to this rule for historical insurance policies is crucial – especially when it comes to responding to environmental claims.
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