After eight-days of evidentiary hearings that were completed last year on Sept. 7 and after the parties filed 125 pages of legal briefs summarizing their positions, on Jan. 23 Judge John Z. Lee heard oral arguments on the City of Evanston’s motion for a preliminary injunction against Northern Illinois Gas Company and Commonwealth Edison Company (the “Utilities).
This was the latest step in the City’s ongoing litigation about alleged environmental contamination of its water pipelines and the presence of methane below the soil in the James Park area.
A preliminary injunction is usually entered to preserve the status quo until a full trial on the merits is conducted. To obtain a preliminary injunction, the City must demonstrate, among other things, that there is a likelihood that the alleged environmental contamination in the James Park area was caused by the Utilities; that the environmental contamination poses an imminent and substantial threat of harm to the public health or the environment; and that an award of damages at a full trial on the merits would not provide the City with adequate relief.
The City is seeking the preliminary injunction under the federal Resource Conservation and Recovery Act (RCRA). It is asking the Court to appoint a three-member panel to investigate and identify the location of the Utilities’ Gas Pipelines, to investigate the extent of the contamination, to design (for possible later implementation) any remediation plans, and to undertake related tasks.
The City asks that the Utilities be ordered to pay for all work done by the three-member panel.
The oral argument on Jan. 23 lasted about four hours, with each side having five attorneys at its table. The City has lawyers from two law firms representing it in the litigation. As of mid-December, the City had incurred fees and costs of about $6.5 million.
Judge Lee began asking questions a few minutes into the argument, and virtually the entire session consisted of questions and answers. Many of the questions focused on whether the City established the requisite threat of harm to warrant a preliminary injunction. At the conclusion of the arguments, the Court did not issue a ruling on any of the issues, but took the request under advisement, which means it will rule at a later date.
To a large extent the dispute is a battle of experts on technical issues. But the City’s repeatedly telling residents that its drinking water is safe loomed large in the arguments.
An Overview of the Claims
The City claims in its federal complaint that the Utilities owned and operated a manufactured gas plant in Skokie (the "Skokie MGP") on the west side of the Northshore Channel, and distributed gas via 24 inch pipelines running under Oakton Street, Dodge Avenue and elsewhere near James Park (the “ Gas Pipelines”). The Skokie MGP ceased operations in the 1950s.
When the Skokie MGP closed, the Utilities left the Gas Pipelines in the ground. The City claims that “hazardous byproducts” of the gas manufacturing process condensed within the pipelines, and those byproducts leaked from broken joints in those pipelines, contaminated the soil, traveled to the City’s municipal water lines, and encrusted those water lines – both inside and out – with a black crust that potentially endangers human health.”
In addition, the City claims that some of the byproducts that leaked from the Gas Pipelines traveled down through the soil toward bedrock, “where they decomposed and left a hazardous deposit of methane now trapped at high pressures, further potentially endangering human health, should the methane be unexpectedly released or travel upward.”
The Utilities hotly contest the City’s claims. The Utilities say that chemical analyses conducted by their experts establish that the materials detected on and in the City’s water pipelines and at bedrock could not have come from the Skokie MGP or the Gas Pipelines.
In addition, the Utilities say that the City’s cast-iron water pipelines were coated inside and out with coal tar-based coatings in the 1920s to protect against rust and that the black crusty material inside and outside the City’s water mains is due the coal tar-based coating disbanding and mixing into the pipe’s normal corrosion and tuberculation.
The Utilities say the methane in the ground is naturally occurring and not due to any substances that came from the Skokie MGP.
Likelihood of Success on the Merits
In order to obtain a preliminary injunction the City must demonstrate that it has a likelihood of succeeding on the merits of its claim after a full trial on the merits. In its brief, the City argues that it only needs to show that it has “some likelihood” of succeeding on the merits. The Utilities argue that the City must make “a clear showing by heavy and compelling evidence that it is likely to succeed on the merits and that it will face irreparable harm” if a preliminary injunction is not granted.
The City’s Claim re: Alleged Contaminants in its Water Pipeline
The City’s brief says Tim Bartus, a City employee, and other City Water Department employees saw a “heavy inch-and-a-half, two-inch” thick black crust on the City’s 24-inch water mains when making repairs between 2004 and 2014. Mr. Bartus saw the black crust when making five or six water main repairs along Dodge Avenue.
The City hired David Hendron, an engineer with experience in environmental source investigation and attribution, to conduct an investigation. Mr. Hendron conducted an investigation “over the course of four years setting forth his findings in multiple reports” and “considered all potential sources of the contamination …,” says the City.
Mr. Hendron concluded that the Gas Pipeline running under Dodge Avenue was connected to the Skokie MGP, that the Gas Pipeline contained condensate wastes from the Lowe gas manufacturing process used at the Skokie MGP, and that the condensate wastes leaked from the Gas Pipeline into the soil.
While the Skokie MGP used a purifier to remove tar from the finished gas it pumped through its pipelines, the City says it is common that there is tar in the gas, which persists in the form of a mist or a fog of suspended particles that is difficult to remove.
The City said Mr. Hendron’s findings were supported by evidence that there was “condensate” in the Gas Pipeline; that some joints in the Gas Pipeline were broken; and there were discolored soils immediately below the Gas Pipeline and the broken joints.
Mr. Hendron also concluded that the condensate that leaked from the Gas Pipeline into the soil migrated from there to the City’s Dodge Avenue water pipeline and formed a “black crust” coating on the outside and inside of those water lines. He also said the crust on the inside and outside the City’s water pipeline was consistent with waste oils found at the Skokie MGP and found in the Gas Pipeline.
Mr. Hendron also said the condensate that leaked from the Gas Pipelines had the consistency of vegetable oil and had the capacity to migrate through cracks and fissures in the soil, adding that there were trenches under Dodge Avenue and other streets where the Utilities’ Gas Pipelines were buried that contributed to mobility.
One of the City’s experts, Mark LeChevalier, said it was possible for a petroleum product to infiltrate a water pipeline, and he testified how it could do so.
The City says one contaminant that consistently showed up in the soil, in the Gas Pipeline and in the City’s water pipelines was naphthalene. The City claims that the coal-tar pitch used to coat the City’s water pipelines did not contain naphthalene, and that finding naphthalene on and in the City’s water pipelines proves that the black crust did not come from the protective coating of coal tar put on the water pipes, but that it came from the Skokie MGP.
The Utilities’ Position re: Alleged Contaminants in the City’s Water Pipelines
The Utilities say their expert, Thomas Gauthier, an analytical chemist experienced in PAHs and MGPs, did a forensic analysis and determined that the PAHs at issue have at least two distinct fingerprints that prove that the Skokie MGP is not the source of any contamination of the City’s water pipelines.
PAHs – polycyclic aromatic hydrocarbons – “are a group of over 100 different chemicals that are formed during the incomplete burning of coal, oil and gas, garbage, or other organic substances like tobacco or charbroiled meat. PAHs are usually found as a mixture containing two or more of these compounds, such as soot,” says the U.S. Agency for Toxic Substances and Disease.
Some common PAHs include coal tar, pavement sealer, diesel exhaust, used motor oil, and urban runoff, say the Utilities.
The Utilities say Mr. Gauthier determined that: 1) the PAHs in the black crust on the Dodge water pipeline has a “pyrogenic coal tar fingerprint,” which means it could not have come from the Skokie MGP, and 2) the Dodge water pipeline has an entirely different type of PAHs than those found in the Gas Pipelines, proving that any contamination did not come from the Gas Pipelines.
The Utilities also argue that their experts’ testimony and testimony given by City officials shows that in the 1920s, the City coated its cast-iron water pipelines, inside and out, with a coal tar to inhibit corrosion. At the time this was the standard: “Every pipe and special casting shall be coated inside and out with coal tar pitch varnish. The varnish shall be made of coal tar.”
The Utilities say the black crust on the outside and inside of the City’s water pipelines does not contain tar from the Skokie MGP, but tar from the coal-tar coating that was put on the City’s water pipelines.
The Utilities disputed the City’s claim that the presence of naphthalene in and on the water pipes proved that the tar came from the Skokie MGP, rather than coating of the pipes with coal-tar.
The Utilities raised several other arguments. First, they say that the Skokie MGP removed all tars and dense non-aqueous phase liquids from the gas before it entered the Gas Pipelines, and there it could not be the source of the alleged contamination. They say it was essential to remove all traces of tar because tar would have destroyed meters and valves in the distribution system, as well as customer appliances.
The Utilities also argue that the Gas Pipeline and the City’s Dodge water pipeline were 15 to 25 feet apart, and the water line was at most 2 to 6 feet below the Gas Pipeline. They say the City’s theory that condensate oils migrated from the Gas Pipeline to the City’s Dodge water pipelines is implausible. And even it did, they say there is no evidence that any tar residue in fact entered the City’s water pipeline.
Judge Lee asked one Utilities’ lawyer to explain the staining of the soils under the joints of the Gas Pipeline. The lawyer said the PHA levels in those soils were near or below “background” levels, which are the levels set for metropolitan areas in Illinois by the Illinois Environmental Protection Agency (IEPA). Because the PAH levels were so low, the lawyer argued, the soil was not contaminated by residual tar from the Skokie MGP.
The Judge also asked one the Utilities’ lawyers to explain the two-inch thick crusting material on the City’s pipelines. The lawyer said the cast-iron water pipes were 80 to 100 years old, and the crusting was due to the coal tar coating detaching, combined with natural corrosion and mixing with soil on the outside of the pipes, and normal tuberculation on the inside. Tuberculation is generally defined as the development of small mounds of corrosion products on the inside of iron pipes. The lawyer said the Utilities presented two witnesses who were experts in pipe construction, coatings and long-term corrosion, who testified they see this all the time, all over the country.
The Source of Methane
Based on soil borings along the perimeter of James Park down to the bedrock, the City’s expert Mr. Hendron concluded that the condensate that leaked from the Gas Pipelines traveled downward through sandy patches and micro fissures to the bedrock 40 feet below the soil and biodegraded to form methane between the bedrock and the glacial till.
The Utilities disputed Mr. Hendron’s conclusion. They said there was a 40-foot confining layer of clay below ground, and there were no micro fissures above the bedrock through which condensate from the Gas Pipelines could flow. In addition, the City’s expert concluded the PAHs detected by the City in the bedrock have a different fingerprint of petrogenic residual or crude oil, which is not the same as the PAHs detected in the Dodge Gas Line or in the Dodge Water Main.
The Utilities also presented an expert who testified that the methane beneath James Park was generated by naturally occurring glacial outwash materials that are common throughout Illinois, and not by degraded waste oils. U. 26 The Utilities presented evidence that the methane contained Carbon 14, and its age was 27,000 years old.
After this testimony, the City said the methane was caused by a mixture of naturally occurring methane and methane caused by waste oils, a point disputed by the Utilities.
The City has been monitoring methane levels with sensors installed at Dawes Elementary School and the Levy Center. The monitors have not detected dangerous levels of methane.
An Imminent and Substantial Threat
Judge Lee asked an attorney for the City to explain what the City must show to satisfy the statutory requirement that there is an imminent and substantial threat to health or the environment.
The attorney said a threat may be imminent even though the harm may not materialize for years, and the requirement is satisfied if there is reasonable cause for concern to the public health or the environment. He said in making a decision on this issue, if an error is to be made, the error must be made to protect the public health and safety. He said a court need not and should not wait until the situation is as dangerous as possible.
The Utilities’ lawyer argued that the City must show that the harm is sufficiently likely, and that the City must show that an imminent and substantial endangerment exists, and that a mere possibility of harm is not enough. There must be a reasonable prospect that a serious, near-term threat exists, he said.
The Judge said the City’s expert, Mr. LeChevallier, posited in his testimony that the black crust in the water pipelines may break off and be distributed in the City’s water distribution system. The Judge said, though, that many decades have passed, and there has been no evidence of that happening, and that there does not seem to be anything in the record that that risk is an imminent one. He asked the City’s attorneys what facts show this is an imminent threat.
The City’s attorney responded that the particles can break loose from the inside of a water pipe and get into the water distribution system, and that Mr. LeChevallier said that frequently happens in the normal course through such things as opening a fire hydrant, traffic moving overhead, or a change in the water’s composition.
The attorney also noted that the City tested its drinking water at various locations throughout the City and found that there were low-levels of PAHs in the water. While the PAH levels were below screening levels of the U.S. Environmental Protection Agency and the IEPA, the attorney said the City’s experts testified that the detection of low levels of PAHs may be indicative of a larger problem.
Judge Lee said the City’s Dodge water pipeline is no longer in service, and asked how there was an imminent threat in light of that. The City’s attorney said Mr. LeChevallier testified the particles may have migrated to other water mains, and that it is likely they have moved elsewhere outside the Dodge water pipelines.
The Judge said Mr. LeChevallier testified, “It’s not reasonable to assume that the particulates would never detach.” The Judge said this opinion seems to be “pretty weak” – Mr. LeChevallier did not say the particulates would actually detach; he did not address the likelihood of the particulates dislodging and entering the water system. The Judge asked, “Is that enough to meet the standard?”
The City’s attorney said under RCRA the likelihood does not need to be quantified.
Judge Lee said he was “troubled” that the City did not calculate any risk of detachment. “Isn’t it incumbent to present some way to quantify the risk quantitatively or qualitatively, he asked.
Still later in the arguments, the Judge said the City has certified that its drinking water is safe, and told residents not to worry. He also noted that the City is selling its water to other municipalities. He said, if the City is doing that, how does that square with the City’s position that this is posing an imminent threat?
“I’m concerned about that,” the Judge said.
The Judge asked about harm to the environment at several times during the argument. He asked the Utilities’ attorney if there were contaminants in the soil from the Skokie MGP, whether that would be sufficient to show environmental harm. The Utilities’ attorneys said, no, and argued the PHA levels were very low and that the Skokie MGP was not the source of any contaminants.
One of the Utility’s lawyers questioned if there was contamination, how could the City have left the water pipeline main under Dodge Avenue?
Adequate Remedy at Law
In order to obtain a preliminary injunction, the City must show it has no adequate remedy at law. The Utilities argue that City has an adequate remedy at law because it can perform the environmental investigation that it is asking the Court to order in the preliminary injunction, and then it can seek to recover the costs of its investigation.
Judge Lee asked why the City did not go ahead and conduct an environmental investigation and front the costs. He asked whether the City could recover the cost of an investigation if it prevailed in a trial on the merits.
The City said it could not recover its costs. One attorney for the Utilities disputed that, saying the City could recover its costs.
A Bond and the Amount
In the event the Court grants a preliminary injunction, the Utilities are asking the Court to require the City to post a bond to cover the cost of any expenses they incur as a result of the injunction. As an example, if the Utilities are required to pay $200,000 to fund the cost of an environmental investigation ordered by the Court, they say the City should post a bond of $200,000, so that money would be available to reimburse them if it is later determined that the preliminary injunction was wrongfully entered.
Judge Lee asked the parties if a bond is mandated in a RCRA case. The City said no. The Utilities said yes.
Because the investigative work under the proposed injunction would be done in stages, the Judge asked the parties what they thought about having the amount of the bond increase in stages as well.
The City’s attorney said if a bond was going to be required, it would make sense to have it increase in stages. He quickly added, though, the bond should be only a percent, such as 5% or 10%, of any amount the Utilities were required to pay toward the cost of the investigation.
Judge Lee asked if he ordered the Utilities to pay $200,000 toward an investigation, why would the bond not be $200,000?
The City’s attorney said because the risk is low that the City will not prevail in the case. Not surprisingly, the Utilities' attorney argued that the bond should be dollar-for-dollar.
The Court’s Ruling
At the conclusion of the arguments, Judge Lee did not rule on any of the legal or factual issues, but took the motion under advisement. He asked the parties to file supplemental briefs on the issue of environmental harm, and he set a briefing schedule that will be completed on Feb. 28. He asked the parties to file a joint report on Feb. 28 listing any additional discovery they need to proceed to trial. He set the case for status on March 12.