Builder Can’t Duck $28 Million Tab for Big Fire

(CN) - A California construction company must pay its portion of a $28 million fine for causing an 18,000-acre fire in the Angeles National Forest, the 9th Circuit ruled, finding that the mass destruction of native-species habitat and historic structures warranted the stiff penalty for "intangible environmental harm."

Employees of CB&I Constructors sparked the Copper Fire in 2002 while building water tanks on private property near the national forest.

Spurred on by a promise of a bonus, the crew worked in 100-degree heat and ignored fire hazards, neglecting to clear or water down dry brush at the worksite and to look out for errant sparks from an electric grinder.

After burning some 2,000 acres of private land, the blaze spread to the national forest, where it eventually raged through 28 square miles of wilderness. The fire completely destroyed rare chaparral and sage scrub vegetation in San Francisquito Canyon, and paved the way for invasive flora and runaway floods to do even more damage to some 90 percent of the habitat of the California red-legged frog. The Copper Fire also damaged the historic Hazel Dell Mining Camp, an abandoned graphite mine with cabins and artifacts from the early 20th century.

It cost the federal government more than $6 million to put out the fire. At the time, researchers estimated that it would take the forest more than 20 years to recover from the blaze. CB&I's workers "eventually received a bonus for completing the water tanks in fewer hours than originally projected," according to the court.

The government took CB&I and original contractor, Merco Construction Engineers Inc., to trial in Los Angeles in 2009. The negligence action included claims for fire suppression, but also for damage "not susceptible to empirical calculation," such as the loss of important habitats and recreational opportunities. A jury found CB&I to be 65 percent responsible for the fire, and attributed 35 percent of the fault to Merco. The jury awarded the government $7.6 million in suppression costs and $28.8 million in "intangible environmental damages."

After the District Court denied CB&I's motion for a new trial or remittitur, the company took the issue to the 9th Circuit.

CB&I did not appeal the suppression award, but argued that it did not legally have to pay for intangible damage. The company also argued that the fine was excessive and that the government had failed to present sufficient evidence to justify it.

A three-judge panel of the federal appeals court disagreed and ruled for the government on Friday.

"We see nothing in California law that prevents the federal government from recovering intangible, non-economic environmental damages for a negligently set fire," Judge William Fletcher wrote for the Pasadena-based court.

"California embraces broad theories of tort liability that enable plaintiffs to recover full compensation for all the harms that they suffer," Fletcher wrote. "Under California law, the government may recover intangible environmental damages because anything less would not compensate the public for all of the harm caused by the fire."

The government presented ample evidence of intangible damage such as the long-term harm to opportunities for public use, as well as animal habitats, soils, plant life, the California red-legged frog and the historic mining camp, the panel found

"Given the scope of the environmental harm caused by the Copper Fire, we agree with the district court that the jury's damage award of $1,600 per acre was not grossly excessive or against the clear weight of the evidence," Fletcher wrote.

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