Bunker Limited Partnership v. United States

No. 85-3133 (D. Idaho December 6, 1985)

The court holds that in an investigation under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), EPA is not authorized to examine all documents at a hazardous waste site to determine which are subject to a previously issued inspection warrant. Both the current and prior owners of the site challenged the scope of EPA's authority under CERCLA § 104(e) to inspect all documents at the site. The court first holds that it has jurisdiction to consider the motions for protective orders. Although an appeal of this court's order upholding the validity of the inspection warrant is pending in the Ninth Circuit Court of Appeals, the issue of the scope of EPA's authority under the warrant is not the subject of that appeal. The court rules that an administrative inspection warrant is subject to the rules applicable to an administrative subpoena, rather than the applicable to a criminal search warrant or a request for production of documents. Thus the owner of the site, not EPA, is responsible for examining its documents to determine which are subject to the warrant. CERCLA § 104(e), authorizing EPA inspections, clearly suggests that the company rather than EPA determines which documents are responsive to the warrant. Moreover, the Supreme Court has suggested that an administrative inspection based upon a warrant is analogous to that compelled pursuant to an administrative subpoena. Lastly, an administrative inspection in CERCLA civil action does not justify the intrusive investigative procedures of a criminal search. Finally, the court denies the motion to internene of the site's prior owner, holding that its interests are sufficiently represented by the current owner.

Counsel for Plaintiff
Wayne B. Slaughter, Edwin A. Apel
Hawley, Troxell, Ennis & Hawley
Seventh Fl., One Capital Ctr., P.O. Box 1617, Boise ID 83701
(208) 344-6000

Counsel for Defendant
Jeffrey W. Ring, Ass't U.S. Attorney
Rm. 693 Federal Bldg., Box 037, 550 W. Fort St., Boise ID 83724
(208) 334-1211

[16 ELR 20758]

Ryan, J.:

Order

I. Introduction

On December 5, 1985, the court heard oral argument on a number of pending motions in this matter. Those motions arise from a dispute over the scope of that portion of the administrative inspection warrant providing for the inspection and copying of certain documents.

On October 21, 1985, the court entered an order upholding the validity of the warrant. Since that time, the Environmental Protection Agency (EPA) has been performing the authorized inspections. On December 3, 1985, EPA informed Bunker Limited Partnership (Bunker Ltd.) that it would undertake an inspection of all documents at the Bunker Hill site in an effort to determine which documents fell within the categories specified in the warrant for copying and carrying away. Bunker Ltd. responded by filing before this court a motion for protective order.

This action by the EPA also prompted the Pintlar Corporation to move to intervene in this action (and move, if allowed to intervene, for a protective order). Pintlar Corporation owned and operated the Bunker Hill facility prior to its sale to the current owners, Bunker Ltd. Pintlar Corporation seeks to protect privileged attorney-client communications contained in documents still at the Bunker Hill site.

II. Discussion

A. Jurisdiction

The EPA argues this court is without jurisdiction to entertain the pending motions for protective order because the court's earlier determination that the inspection warrant is valid is on appeal to the Ninth Circuit, thus divesting this court of jurisdiction. In general, filing of a notice of appeal confers jurisdiction on the court of appeals and divests the district court of control over those aspects of the case involved in the appeal. Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58 (1982). However, the only matter before the court at the time it entered its October 21, 1985, order (which is the subject of the appeal) was the validity of the warrant. The court now has before it the issue of what documents the EPA has authority to inspect under the provisions of that warrant. This aspect of the case is not the subject of the appeal, and therefore, this court has jurisdiction to resolve that issue. See Marrese v. American Academy of Orthopaedic Surgeons, 470 U.S. , 84 L. Ed. 2d 274, 280 (1985).

B. Bunker Ltd.'s Motion for Protective Order

The administrative inspection warrant which is the subject of this suit provides in pertinent part:

Inspecting, photographing, copying, and carrying away copies of business activity documents and records of any type maintained or filed anywhere on the said property or in any building or structure thereon, or in any container in any such building or structure, which documents and records are responsive to EPA's April 1, 1985 Request for Information (Attachment F).

The issue presented by Bunker Ltd.'s motion for protective order and EPA's response to that motion is: Does the inspection warrant grant EPA the authority to examine all documents at the Bunker Hill site to determine which documents and records are responsive to EPA's April 1, 1985, request for information?

The parties have cited no case law or secondary authority addressing this specific issue, nor has the court's research revealed any. (It should be noted that this issue differs from the question of whether the terms of the warrant itself are sufficiently specific to satisfy the reasonableness requirements of the fourth amendment.) It does appear, however, that the document search under this inspection warrant might be analogized to either a criminal search warrant or an administrative subpoena.¹ The EPA quite candidly argues that the inspection warrant, as it regards the inspection of documents, is similar to a search warrant in that it allows the EPA to search all files to determine which documents are responsive to the warrant. See United States v. Tamura, 694 F.2d 591 (9th Cir. 1982).

The court, however, concludes that the inspection warrant is more properly analogized to an administrative subpoena. This means that Bunker Ltd., not the EPA, is responsible for searching its documents to produce those documents which are responsive to the warrant. Several factors lead the court to this conclusion.

First, the language of 42 U.S.C. § 9604(e), which grants the EPA authority to perform on-site inspections, suggests the information is to be turned over by the company. Congress used the words "furnished," "submitting," "provide," and "designate" to prescribe the company's duties under Section 9604(e). The use of these words suggests Congress's intent that the company search its files to turn over the relevant information rather than EPA searching the files to determine for itself whether the information is responsive to a warrant.

Second, the language of the United States Supreme Court decision in See v. City of Seattle, 387 U.S. 541 (1967), suggests an administrative inspection of documents pursuant to a warrant is similar to compelling the production of such documents under an administrative subpoena. While the court in See held that administrative entries for inspections be subject to warrant procedures, the court's dicta is instructive:

The agency has the right to conduct all reasonable inspections of such documents which are contemplated by statute, but it must delimit the confines of a search by designating the needed documents in a formal subpoena.

Id. at 544 (emphasis added). The Court also stated, "[g]iven the analogous investigative functions performed by the administrative subpoena and the demand for entry. . . ." Id. Again, this language suggests that an administrative inspection warrant to inspect documents is analogous to an administrative subpoena.

Finally, it seems clear that the consequences of, and exigencies for, a criminal search are more substantial than an administrative inspection in the context of a civil action under CERCLA. The specificity requirements of a warrant are compromised to a certain extent where the government is allowed to look, even briefly, at all documents in the possession of the person being searched. While such a compromise may be justified in the context of a criminal search, it cannot be justified in the context of the inspection warrant issued pursuant to the investigatory provisions of CERCLA.

For these reasons, the court finds that the administrative inspection warrant issued in this case, as it relates to the inspection of documents, is analogous to an administrative subpoena, and therefore, the EPA is not entitled to review all documents to determine which it feels fall within the parameters of the warrant.

C. Pintlar's Motion to Intervene

The Ninth Circuit has adopted a four-part test for determining the appropriateness of a motion to intervene as of right under Rule 24(a)(2) of the Federal Rules of Civil Procedure:

(1) the applicant's motion must be timely; (2) the applicant must assert an interest to the property or transaction which is the subject of the action; (3) the applicant must be so situated that without intervention the disposition of the action may, as a practical matter, impair or impede his ability to protect that interest; and (4) the applicant'sinterest must be inadequately represented by the other parties.

Sagebruch Rebellion, Inc. v. Watt, 713 F.2d 525, 527 [13 ELR 20928] (9th Cir. 1983). Pintlar has failed to show that it meets the fourth prong of this test.

In the weeks preceding the filing of the motions for protective order now before the court, Bunker Ltd. had been providing the EPA with documents Bunker Ltd. felt were responsive to the inspection warrant. Pintlar was aware of this situation, yet did not seek to intervene to protect its interest at that time. It seems apparent, therefore, that Pintlar was content to rely upon Bunker Ltd.'s discretion in protecting Pintlar's privileged communications. In light of the court's ruling on Bunker Ltd.'s motion for protective order, Pintlar's situation, vis-a-vis Bunker Ltd. and the EPA, remains the same, and therefore, Pintlar continues to be adequately [16 ELR 20759] represented by Bunker Ltd. As a rsult, the fourth prong of the test for intervention is absent, and Pintlar's motion to intervene must be denied.

Having denied Pintlar's motion for intervention, the court need not address Pintlar's motion for protective order.

III. Order

Based upon the foregoing and the court being fully advised in the premises,

IT IS HEREBY ORDERED that Bunker Ltd.'s motion for protective order should be, and is hereby, GRANTED. The inspection warrant issued in this matter does not authorize the EPA to review all documents to determine which it feels fall within the parameters of the warrant. Bunker Ltd. shall produce for EPA inspection all documents and records which are responsive to EPA's April 1, 1985, request for information.

IT IS FURTHER ORDERED that Pintlar Corporation's motion to intervene should be, and is hereby, DENIED.

1. Bunker Ltd. argues that the warrant is essentially a request for the production of documents and is governed by Rule 26(c) of the Federal Rules of Civil Procedure. While an action under CERCLA is civil in nature and the rules of civil procedure apply to CERCLA proceedings, it is untenable to suggest an inspection warrant issued under the investigatory provisions of CERCLA, 42 U.S.C. § 9604, is the same as a request for production of documents under Rule 26. Administrative inspection warrants, like search warrants and administrative subpoenas, are governed by their own body of statutory, regulatory and case law, albeit a developing body of law.