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Garland, City of v. Zurn Indus.

Citation: 19 ELR 21297
No. No. 88-1697, 870 F.2d 320/29 ERC 1753/(5th Cir., 04/21/1989)

The court holds that the misrepresentation exception to the Federal Tort Claims Act (FTCA) bars a third-party action against the Environmental Protection Agency (EPA) for any negligence in its analysis, testing, or approval of a city's wastewater treatment process. The City of Garland, Texas, had sued the contractor that designed the treatment facility when the innovative physical-chemical carbon adsorption system had ruptured, causing the city to be held responsible for a substantial civil penalty for violation of its discharge permit under the Federal Water Pollution Control Act. The contractor filed a third-party action against EPA, alleging that EPA's failure to exercise due care in studying the system before approving the design had proximately caused the city's injuries. The court holds that the FTCA's misrepresentation exception bars the third-party claim. The exception protects EPA against liability for damages the city incurred as a result of its reliance on data EPA collected on the physical-chemical treatment process and that the Agency shared with the contractor, since it has not been shown that EPA owed the city any duty, either to counsel on the physical-chemical treatment process or to compile accurate information. That EPA's regulations require the Agency to review and evaluate proposed treatments works designs before awarding government funds for construction serves as no guarantee that an applicant's plans will satisfy the applicable effluent limitations. The primary responsibility for administration of a construction grant remains with the grantee, who is responsible for the project's success. The regulations' purpose is primarily to ensure that the government's investment in wastewater treatment projects is put to best use to improve the quality of the environment; although the city may have been an incidental beneficiary, the intended beneficiary of EPA's research efforts was the environment itself. That EPA may have furnished inaccurate test data to the city or the contractor does not impose liability, since the FTCA precludes damages resulting from the government's negligence in obtaining and communicating information.

Counsel for Appellant
Teresa Jenkins Carson, William R. Allensworth
Haynes and Boone
3100 First Republic Bank Plaza, 901 Main St., Dallas TX 75202-3714
(214) 670-0550

Counsel for Appellee
Jay Tidmarsh
Torts Branch, Civil Division
U.S. Department of Justice, P.O. Box 888, Ben Franklin Station, Washington DC 20044
(202) 724-9891

Before POLITZ and JOLLY, Circuit Judges, and HUNTER, District Judge.*