On April 3, 2013, in Ecological Rights Foundation v. Pacific Gas and Electric Company (ERF v. PG&E), the Ninth Circuit upheld the dismissal with prejudice of a case where an environmental group using statutory “citizen suit” provisions alleged that wood-treated utility poles are subject to the federal Clean Water Act (CWA) and Resource Conservation and Recovery Act (RCRA).  Schiff Hardin represented PG&E in this matter.

Wooden utility poles, of which there are over 100 million in use across the United States, are treated with biocides such as pentachlorophenol to preserve their strength and increase their longevity. Wooden utility poles have long been the industry standard. They are used by virtually every electric and communications utility that operates in the United States and are a ubiquitous part of every urban and roadside landscape.

This suit stems from a long-running dispute between various environmental groups and the USEPA over whether treating utility poles with wood treatment preservative should be permitted.  USEPA last approved the continued use of the involved wood preservative – pentachlorophenol – in 2008.  In ERF v. PG&E, which was filed a year later, ERF claimed that each utility pole used by PG&E (and Pacific Bell Telephone, which was added to the Complaint after it was initially filed) in a four-county area of California was a CWA “point source” which required federal permits, and that wood treatment preservative released from the poles was a RCRA waste posing an “imminent and substantial endangerment to the environment.”

The Ninth Circuit held that neither CWA nor RCRA was applicable to in-use utility poles. The three-judge panel found that utility poles were neither “point sources” as the term is defined under CWA nor were “associated with industrial activity,” as would be required to trigger federal permitting obligations.  Poles are not “point sources,” in the Ninth Circuit’s view, because they do not “discretely collect[] and convey[] to the waters of the United States” CWA “pollutants.” In concluding that utility poles were not “associated with industrial activity,” the Ninth Circuit relied on evidence including that USEPA had explicitly excluded “major electrical powerline corridors” from stormwater regulation, as well as the wording of 40 C.F.R. § 122.26(b)(14), the regulation that defines “associated with industrial activity” for CWA.

RCRA is a statute which is designed to provide a “cradle-to-grave” framework for the regulation of waste products.  “RCRA’s ‘primary purpose’ is ‘to reduce the generation of hazardous waste and to ensure the proper treatment, storage, and disposal of waste which is nonetheless generated, ‘so as to minimize the present and future threat of harm to human health and the environment.’” RCRA’s applicability hinges on something being “abandoned” or “discarded.” Here, even though ERF’s lawsuit was focused on in-use utility poles, ERF alleged that the pentachlorophenol treatment from the poles tended to “leak” as part of its intended function as a preservative.

ERF alleged that the “leakage” of pentachlorophenol from the poles constituted a RCRA “imminent and substantial endangerment.”  The Ninth Circuit explicitly rejected that “leakage” from poles resulted in “waste” being “discarded.” Instead, the court found that “escaping” pentachlorophenol from in-use poles is “neither a manufacturing waste by-product nor a material that the consumer . . . no longer wants and has disposed of or thrown away.” Any “leakage” was a residue from an EPA-approved pesticide which is released as a part of its intended use.

This case was a test case on expanding the reach of RCRA and CWA to undercut EPA’s continued approval of a wood treatment preservative, which environmental groups were previously unsuccessful in doing directly. This decision comes on the heels of the Supreme Court’s Decker v. Northwest Environmental Defense Center decision, which arguably opens the door to environmental groups being able to use “citizen suits” to undercut long-standing agency decisions of their statutory mandates. The Ninth Circuit’s decision in ERF v. PG&E reflects that EPA’s reasoned interpretation of its rules should be respected and ERF’s interpretation of how CWA and RCRA apply to these facts was unsupportable.