Two Pennsylvania women brought a state law nuisance claim in federal court against the owner of coal fired power plant that allegedly damaged their property through the emissions of ash, chemicals, and odors. The power plant, which is owned by GenOn Power, was apparently in compliance with the state and federal environmental regulations that govern the operation of coal power plants. The lawsuit was initially dismissed by the district court, which held the suit was preempted by the Clean Air Act. The Third Circuit recently reversed the district court and held that the Clean Air Act is not preemptive.
In its decision, the Third Circuit found that “nothing in the Clean Air Act [indicates] that Congress intended to preempt state common law tort claims.” The Court further stated that the Clean Air Act is “a regulatory floor, not a ceiling, and expressly held that states are free to impose higher standards on their own sources of pollution, and that state law tort is permissible way of doing so.” The Third Circuit relied in large part on the Supreme Court’s holding in International Paper Co. v. Ouellette, 479 U.S. 481 (1987),which held that the Clean Water Act did not preempt state law tort claims.
The Third Circuit’s ruling appears to go against strong authority supporting preemption. In Am. Elec. Power Co., Inc. v. Connecticut, the Supreme Court held that the Clean Air Act preempted federal common law nuisance claims as a means to curb emissions from a power plant. 131 S. Ct. 2527 (2011). In that case, the Supreme Court noted that the EPA has been designated to serve as the emission regulator and is better suited to do so than judges issuing ad hoc injunctions. Additionally, the Fourth Circuit has held that that state law nuisance claims against power plants are preempted because they threaten the comprehensive regulatory scheme. See N. Carolina, ex rel. Cooper v. Tennessee Valley Auth., 615 F.3d 291, 303 (4th Cir. 2010).
This new ruling is very significant as it opens the door to a potential onslaught of litigation. It means that residents can pursue property claims against power plants even though they are in compliance with state and federal regulations. That sound that citizens in Northeast are hearing is the sound of their electricity rates and bills clicking higher.