## Facts

- Groundwater in Albuquerque’s South Valley was contaminated with volatile organic compounds, affecting a municipal well field serving the city.
- The contaminated area included industrial property known as Plant 83, used for federal defense-related manufacturing; ACF operated early production, GE later operated the facility under Air Force contracts, then purchased and continued operating it.
- At New Mexico’s request, EPA listed the site for federal action under CERCLA and undertook the remedial process (investigation, feasibility study, remedy selection, and records of decision).
- EPA directed GE to design and implement a long-term groundwater remediation system; the cleanup was ongoing and expected to continue for many years.
- The New Mexico Attorney General, represented by contingent-fee private counsel, filed state-law damages actions seeking large unrestricted monetary damages for alleged injury to the aquifer and “loss of use” of groundwater.
- The actions asserted state-law theories (including trespass, public nuisance, and negligence) and sought damages conceptually similar to natural resource damages.
- The federal district court granted summary judgment for GE and ACF, finding the Attorney General failed to raise genuine issues of material fact on injury and damages.

## Issues

1. Whether a state may obtain unrestricted monetary damages under state law for groundwater contamination while EPA is implementing and overseeing a CERCLA remedial action for the same site.
2. Whether CERCLA’s natural resource damages framework limits or constrains state-law damages theories that functionally seek compensation for alleged injury to natural resources.
3. Whether New Mexico produced sufficient evidence of a present, compensable injury to a distinct state property/trust interest in groundwater and legally cognizable damages independent of the CERCLA remedy.
4. Whether portions of the appeal amounted to an impermissible collateral challenge to EPA’s remedy selection, outside the court’s jurisdiction under CERCLA’s review scheme.

## Decision

- The Tenth Circuit affirmed summary judgment for GE and ACF on the Attorney General’s state-law damages claims.
- The court agreed that the Attorney General failed to present evidence creating a triable issue on compensable injury to a distinct state interest in groundwater and on damages independent of the ongoing CERCLA remedy.
- To the extent the appeal effectively challenged the adequacy of EPA’s selected remedy, the court dismissed those aspects for lack of jurisdiction under CERCLA’s limits on collateral review.
- The disposition was affirmed in part and dismissed in part.

## Legal Principles

- CERCLA vests EPA with primary authority to select and oversee remedial actions, and CERCLA restricts collateral challenges to remedy decisions to the statute’s specified review mechanisms.
- A state acting as a natural resource trustee may recover natural resource damages only in a restoration-oriented manner: damages must be used to restore, replace, or acquire the equivalent of injured resources.
- A plaintiff seeking monetary damages for contamination must show a compensable injury to a distinct state property or trustee interest and non-speculative damages not merely premised on dissatisfaction with an EPA-directed cleanup.
- State-law damages theories cannot be used to obtain unrestricted monetary recovery that conflicts with, second-guesses, or circumvents an EPA-approved CERCLA remedial action.

## Conclusion

The Tenth Circuit held that New Mexico could not obtain unrestricted state-law monetary damages premised on asserted “loss of use” of groundwater while EPA’s CERCLA remedy was governing the cleanup, because the Attorney General failed to show a distinct compensable injury and damages independent of the federal remedial scheme, and portions of the case were barred as collateral attacks on EPA’s remedy decisions.


New Mexico v. Gen. Elec. Co., 467 F.3d 1223 (10th Cir. 2006)