In the Courts

Water Cases

Dyer v. TCEQ, 2019 WL 2206177 (5/22/2019).

The Texas Court of Appeals in Austin affirmed the dismissal of a challenge to TexCom Gulf Disposal, LLC’s approved permit for construction and operation of underground injection control wells for disposal of non-hazardous industrial waste. The general purpose of the Injection Well Act (“Act”) is to maintain the quality of fresh water for the public and existing industries, while considering the state’s economic development, and specifically to prevent underground injection that may pollute fresh water. Under the Act, a business seeking to operate an injection well must apply for a permit from the Texas Commission on Environmental Quality (“TCEQ”), and submit a letter from the Railroad Commission of Texas (“RRC”) asserting that the injection well will not harm an oil or gas reservoir.

The RRC first issued a no-harm letter in 2005. After the TCEQ closed the administrative record, the RRC rescinded its 2005 no-harm letter when a nearby mineral rights owner argued that the wells might harm the reservoir.

The Court of Appeals construed the Texas Administrative Procedure Act, which generally provides the minimum standards of uniform practice and procedure for state agency proceedings, to allow parties to rely on the finality of agency decisions. And therefore, the Court of Appeals held that the rescinded RRC letter did not have any impact on the administrative proceedings before the TCEQ, which were conducted years before the challenge.
Corpus Christi v. Trevino, 2019 WL 2381455 (6/6/2019).

The Texas Court of Appeals in Corpus Christi clarified the application of governmental immunity to political subdivisions from tort actions. In May 2016, the City of Corpus Christi (“City”) issued a water boil advisory. Trevino sued the City in 2018 alleging that she was out of water for two weeks and that she had to pay for a service she did not receive. Among her allegations were negligence and breach of contract.

Trevino alleged that she drank un-boiled water and that as a result she suffered illness. Trevino relied on the Texas Tort Claims Act (“TTCA”) to assert that governmental immunity is waived for all claims from a city’s performance of governmental function. Under the TTCA, immunity is waived when the injury is caused by a condition of tangible property. Because potable water is a condition, Trevino alleged a viable negligence claim under the TTCA. Nevertheless, the Court of Appeals held that Trevino’s negligence claim failed on the TTCA’s notice requirement, which requires that the claim is filed no later than six months after the incident.

For the breach of contract claims, governmental entities waive immunity from liability, but not from suit. A narrow exception under Chapter 271 of the Local Government Code waives immunity when a local governmental entity enters into an agreement for providing goods or services to the local governmental entity. Trevino argued that the agreement was not subject to immunity because the City was performing a proprietary function. The court dismissed Trevino’s argument, because water service is one of the enumerated government functions in the TTCA.

League of United Latin American Citizens v. Edwards Aquifer Authority, 2019 WL 4050469 (8/28/2019).

The League of United Latin American Citizens (“LULAC”) sued the Edwards Aquifer Authority (“EAA”), claiming that its electoral scheme violated the “one person, one vote” principle of the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution. Claiming to be a special-purpose unit of government, the EAA countered that it was exempt from the one “person, one vote” rule.

The EAA’s jurisdiction covers eight counties representing three districts regions: (1) the western agricultural counties of Atascosa, Medina, and Uvalde, where approximately 117,000 persons live; (2) the eastern spring-flow counties of Caldwell, Comal, Guadalupe, and Hays, where roughly 435,000 people live, and (3) the urban county of Bexar, which has over 1.7 million residents. Under the current voting scheme, the “agricultural” and “spring-flow” counties (herein, “rural counties,” together representing a constituency of roughly 552,000 people) elect a total of 8 voting members on the EAA Board of Directors, while the more densely populated Bexar County (representing a constituency of roughly 1.7 million) only elects 7 members of the EAA Board of Directors. Under this scheme, all eligible voters are enfranchised (i.e., if you live in the EAAs jurisdiction and are eligible to vote, you have a right to vote for representation of your particular district; no other stipulations restrict one’s eligibility to vote).

In its opinion, the court leaned heavily on two particular cases where certain voting schemes were upheld as Constitutional, despite not complying strictly with the “one person, one vote” principle (see Salyer Land Co. v. Tulare Lake Basin Water Storage District, and Ball v. James). To qualify for the Salyer-Ball exception, the governmental entity in question (and its electoral scheme) must (1) serve a special limited purpose; and (2) disproportionately impact voters, such that the voters with the most at stake have more voting power than those with less at stake.

In applying the Salyer-Ball test, the court found that the EAA serves a special limited purpose as opposed to having general governmental powers and duties. Some facts the court considered were that the EAA cannot levy ad valorem property or sales taxes or oversee such public functions as schools, housing, zoning, transportation, roads, or health and welfare services. Rather, the EAA’s powers are expressly tailored to protecting the quantity and quality of groundwater in the Edwards Aquifer. The court also found that the EAA’s activities disproportionately impact the western agricultural and eastern spring-flow counties, whose residents are most empowered by its elections.

Because the court found that (1) the EAA was a limited special purpose district and (2) its operations disproportionately impacted the citizens of the rural counties of its jurisdiction more than the citizens of Bexar County, it held that the EAA falls within the exception to the “one man, one vote” principle carved out in Salyer and Ball. Therefore, the Court of Appeals affirmed the district court’s ruling that the EAA’s current scheme is not in violation of the “one man, one vote” Constitutional rule.

Knight v. U.S. Army Corps of Engineers, 2019 WL 3413423 (7/29/2019).

A federal District Court rejected a Motion to Complete the Administrative Record brought under the federal Administrative Procedure Act (“APA”). The landowner-plaintiffs’ claim would have required the U.S. Army Corps of Engineers (“Corps”) to compile an administrative record for the Court of certain allegations relating to a permit it granted to the North Texas Municipal Water District (the “District”).

In early 2018, the Corps issued a permit to construct the Lower Bois d’Arc Creek Reservoir. Landowners near the proposed site of the Reservoir challenged the permit, arguing that (1) the Reservoir would cause “significant degradation of waters,” and citing the lack of a plan to mitigate adverse impacts to the water, and (2) the Corps’s failure to conduct an analysis that would ensure that the “least environmentally damaging practicable alternative was selected.”

The court found that judicial review of an APA claim is limited to the documents and materials directly or indirectly contemplated by an agency in making decisions — that is the administrative record. Absent evidence of the contrary, the court presumes that the agency properly designated the record. That notwithstanding, a party may supplement the record if it demonstrates there is a reasonable basis to believe that some materials considered in the decision-making process are not included in the administrative record.

The court denied the landowners’ motion to include the 2016 Region C Water Plan, five documents discussed and cited in public comments, and a log of information deemed privileged. The request to add the 2016 Region C Water Plan was found moot because the Plan had already been added to the administrative record.

Regarding the public comment documents, the court held that landowner plaintiffs provided little evidence that would permit the court to find that the Corps constructively considered the documents beyond their mere reference in public comment letters that were already part of the administrative record. Plaintiffs should have shown that the record lacks necessary information to evaluate the claims or documents that are adverse to the Corps’ decision.

Regarding the privilege log, the court accepted the Corps’ statement that documents were partially redacted or withheld entirely due to privilege, and that the Corps provided brief explanations of the basis for such redactions and withholdings.

Taylor v. San Jacinto River Authority, 2019 WL 3720099 (8/8/2019).

The Texas Court of Appeals in Beaumont upheld a trial court’s judgment in a case where the appellant unsuccessfully sued the San Jacinto River Authority (“SJRA”), seeking damages for injuries and wrongful death. The appellant asserted that a boat, on which he was a passenger, collided with a landmass bulkhead along the shoreline of a lake. The executor alleged SJRA was negligent in a number of assertions. SJRA’s plea to the jurisdiction was granted by the trial court on the basis of governmental immunity.

The Court of Appeals reasoned that while governmental units are typically immune from suit, the Texas Torts Claims Act (“TTCA”) provides a limited waiver of such immunity to certain tort claims. Generally, under the TTCA, “a governmental unit is liable for personal injury and death caused by the condition of real property if the governmental unit would, were it a private person, be liable to the claimant according to Texas law.” However, the TTCA is restricted by the recreational use statute, which provides that, “if a person enters premises owned, operated, or maintained by a governmental unit and engages in recreation on those premises, the governmental unit does not owe to the person a greater degree of care than is owed to a trespasser.” Thus, SJRA only waives its governmental immunity if it acted willfully, wantonly, or through gross negligence.

Since the plaintiff did not plead facts that SJRA acted in a grossly negligent manner, which caused the injuries and wrongful death at issue, the court rejected the appeal and upheld the trial court’s judgment that the court lacked jurisdiction because SJRA enjoyed governmental immunity.

Relevant General Litigation Cases

With the U.S. Supreme Court and the Texas Supreme Court just coming back from their summer vacations, we thought it might be worth looking at the U.S. Supreme Court’s upcoming term, and also revisiting a case from the Texas Supreme Court’s last term.

US Supreme Court 2019-2020 Preview

With the Supreme Court resuming hearing cases October 7th, here are a few cases we are watching this term.

Allen v. Cooper

The Court will decide whether the Copyright Remedy Clarification Act validly abrogates state sovereign immunity allowing authors of original expression to sue states who infringe their (federal) copyrights.

Atlantic Richfield Co. v. Christian, et al.

The Court will take up three related EPA questions: (1) whether a common-law claim for restoration seeking cleanup remedies that conflict with remedies ordered by the Environmental Protection Agency is a jurisdictionally barred “challenge” to the EPA’s cleanup under CERCLA; (2) whether a landowner at a Superfund site is a “potentially responsible party” that must seek EPA approval under CERCLA before engaging in remedial action, even if the EPA has never ordered the landowner to pay for a cleanup; and (3) whether CERCLA preempts state common-law claims for restoration that seek cleanup remedies that conflict with EPA-ordered remedies.

County of Maui v. Hawaii Wildlife Fund

The Court will decide whether the Clean Water Act requires a permit for pollutants that originate from a point source but are conveyed to navigable waters by a nonpoint source (such as groundwater).

Kelly v. United States

The Court will answer does a public official “defraud” the government of its property by advancing a “public policy reason” for an official decision that is not her subjective “real reason” for making the decision?

PHI, Inc. v. Texas Juvenile Justice Dep’t., —S.W.3d —-, 2019 WL 1873431 (Tex. Apr. 26, 2019).

On April 26, 2019, the Texas Supreme Court issued its Opinion in PHI, holding that a close temporal proximity between an employee’s negligent parking of a motor vehicle and the subsequent collision satisfies the “active operation of a vehicle at time of incident” inquiry under the Texas Tort Claims Act to waive sovereign immunity for property damage.

This case began dramatically, when an unoccupied cargo van owned by the Texas Juvenile Justice Department rolled backwards down an incline and into PHI’s grounded medical helicopter. The court’s decision does not clarify whether there was a Hollywood-style explosion, or whether the collision resulted in an anticlimactic and unsatisfying thud.

Evidence showed the employee properly parked and exited the van, but did not set the emergency brake. A post-accident inspection found the van’s gear-shift mechanism was worn in a way that prevented the vehicle from going fully into park. Hours before the accident, a different Department employee complained to the vehicle-control officer that the van was “running rough” and a work order for a tune-up was submitted but no follow-up had yet taken place.

PHI sued the Department. The Department asserted PHI’s claims were barred by sovereign immunity. But, of course, the Texas Tort Claims Act waives sovereign immunity for property damage arising from the operation or use of a motor vehicle. The principle dispute was whether the damage to the helicopter arose from the “operation or use” of the van. The Department claimed that the damage to the helicopter occurred when the van was explicitly not being used.

The trial court denied the Department’s plea to the jurisdiction and motion for summary judgment. The Department then took an interlocutory appeal.

In a divided opinion, the court of appeals reversed and rendered a take-nothing judgment. The court of appeals reasoned the waiver of sovereign immunity did not apply because the provision applies only if the vehicle was in “active” operation or use “at the time of the incident” based on the use of this language in a previous case, Ryder Integrated Logistics, Inc. v. Fayette Cty., 453 S.W.3d 922, 927 (Tex. 2015). In PHI, the court of appeals found that the van was not “active” when it was parked, turned off, and the employee had walked away. However a dissenting justice reasoned that “operation” of a vehicle in the statute included safely securing the vehicle at the end of a trip.

The Texas Supreme Court agreed with the dissenting justice and reversed the lower courts’ decisions, holding that the language of the statute provided the governing rule of decision and an essential part of “operation” included making sure the vehicle does not roll away after it is parked. The Supreme Court emphasized that whether a vehicle was in “active” operation “at the time of the incident” is an important consideration but not itself the rule of decision. The language of the statute provides the governing rule of decision and that the statute requires the accident arise from the “operation” of a vehicle. The Court stated Ryder’s emphasis on “active” operation was meant to distinguish the facts from other cases but was not intended to add new elements to the statute. Therefore, the language of the statute provided the governing rule of decision and the Court concluded an essential part of “operation” included making sure the vehicle does not roll away after it is parked.

PHI provides a set of unusual facts of an injury arising from the operation or use of a vehicle even though the driver was not behind the wheel when the accident happened. Although facts such as these are unlikely to occur often, in this case the Court clarifies that the Texas Tort Claims Act—waiving sovereign immunity for property damage arising from the use or operation of a vehicle—does not require the driver to be inside the vehicle at the time of the collision. And it also raises the question: what other actions are ancillary to the “operation and use” of motor-driven equipment?

Air and Waste Cases

California Communities Against Toxics v. EPA, No. 18-1163 (D.C. Cir. 2019).

On July 2, 2019, the D.C. Circuit Court of Appeals held that EPA lacked jurisdiction over legitimate recycling of a hazardous secondary material, even when the entity that generated the material being recycled paid a third party to recycle it. The court found that a generator’s paying a reclaimer to accept a material for recycling does not automatically mean the material is discarded. According to the D.C. Circuit decision, the primary inquiry in deciding whether hazardous materials are discarded, and therefore subject to EPA regulation, is whether those materials have become part of the “waste disposal problem.” The court reasoned that the materials were not contributing to the waste disposal problem because EPA had reasonably concluded the materials were adequate for safe transfer and legitimate recycling.

State of Wisconsin v. EPA, No. 16-1406 (D.C. Cir. 2019); State of New York v. EPA, No. 19-1010 (D.C. Cir. filed March 12, 2018).

On September 17, 2019, the D.C. Circuit Court of Appeals ruled that the EPA must “ensure that upwind states reduce significant amounts of power plant pollution so their downwind neighbors can meet federal ozone limits.” In a related case, State of New York v. EPA, the D.C. Circuit Court of Appeals indefinitely delayed oral arguments challenging EPA’s regulation, or lack thereof, of cross-state pollution while the Agency decides how to proceed in the Wisconsin case. The EPA has until October 29, 2019 to decide whether to rewrite the 2018 update of the cross-air pollution rule in the New York case.

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In the Courts is prepared by Lauren Thomas, a to-be-licensed Associate in the Firm’s Water Practice Group, Lindsay Killeen, a to-be-licensed Associate in the Firm’s Litigation Practice Group, and Samuel Ballard, an Associate in the Firm’s Air and Waste Practice Group. If you would like additional information, please contact Lauren at 512.322.5856 or lthomas@lglawfirm.com, Lindsay at 512.322.5891 or lkilleen@lglawfirm.com, or Sam at 512.322.5825 or sballard@lglawfirm.com.