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Davis v. Sun Oil Co.

Citation: 28 ELR 21358
No. 96-4077, 148 F.3d 606/46 ERC 1910/(6th Cir., 06/24/1998)

The court holds that under Ohio law, the doctrine of res judicata bars property owners' Resource Conservation and Recovery Act (RCRA) suit against the property's seller for leaving gasoline buried in the soil. The owners filed their RCRA suit in federal court after they litigated contract and fraud claims in state court. The court first holds that the district court, in denying the owners' motion for summary judgment, correctly found that the evidence submitted in state court was not by itself adequate to settle as a matter of law the question of whether the pollution may present an imminent and substantial endangerment under RCRA. The precise issue of whether the gasoline contamination may present an imminent and substantial endangerment to health or the environment had never actually been litigated and determined in the state litigation. Therefore, contrary to the owners' assertion, the issue was not precluded from further litigation. Moreover, there was a genuine issue of material fact as to whether the contamination may present an imminent and substantial endangerment. Both parties submitted affidavits by consulting engineers who had reached opposite conclusions on this question. In addition, the owners could not rely on U.S. Environmental Protection Agency (EPA) regulations to establish a standard for the level of contamination that might, as a matter of law, present an imminent and substantial danger. The cited EPA regulations pertain to contamination levels in drinking water, not in soil.

The court next holds that the doctrine of res judicata prevents the owners from maintaining their RCRA action in federal court. Under Ohio law, res judicata requires that the rendering court possess subject matter jurisdiction over the original claim. Furthermore, unless Congress expressly states that jurisdiction lies exclusively with the federal courts, jurisdiction is concurrent with state courts. Because the court finds that the citizen suit provision of RCRA does not expressly provide for exclusive jurisdiction, the proper application of the doctrine of res judicata precludes the owners' action in federal court. The court rejects the dissent's view that even if jurisdiction is concurrent, the seller may not rely on a res judicata defense because it acquiesced to the claim-splitting. The seller gave notice to the owners that it would rely on this defense in its answer to the owners' complaint. Thus, the ownerswere not treated unjustly, as they had fair notice of the seller's claim of res judicata.

A dissenting judge would hold that the owners' RCRA suit was not barred by the application of Ohio's rule against claim-splitting.

[Prior decisions in this litigation are published at 27 ELR 20464 and 20920.]

Counsel for Plaintiffs
A. Mark Segreti Jr.
Haffey & Segreti
2365 Lakeview Dr., Ste. D, Dayton OH 45431
(937) 429-8595

Counsel for Defendant
Michael R. Blumenthal
McMahon, DeGulis, Hoffmann & Blumenthal
The Caxton Bldg.
812 Huron Rd., Ste. 650, Cleveland OH 44115
(216) 621-1312

Before Merritt, Wellford, and Boggs, JJ.