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Georgia’s ‘carpet capital’ not immune from suit over contaminated drinking water

After water that passed through a treatment facility in Dalton, Georgia, was found to be contaminated with toxic runoff from carpet factories, an appeals court found the municipality can be held liable for damages.

ATLANTA (CN) — A federal appeals court ruled Wednesday that a wastewater treatment facility in Georgia, accused of failing to prevent contamination from carpet factory runoff, is not shielded from suit by municipal immunity. 

In a 16-page opinion, the Atlanta-based 11th Circuit found that Dalton Utilities, a municipal corporation that operates Dalton’s wastewater treatment system, can be held liable for damages allegedly suffered by a local resident who claims the facility harmed his health and property. 

Jarrod Johnson, who owns property in Rome, Georgia, along with other citizens filed a lawsuit in 2019 against multiple carpet manufacturers, Dalton and Dalton Utilities, alleging the city's facility violated the Clean Water Act and created a nuisance by allowing the contamination of the area's drinking water. Johnson argues that because he pays to use the water in his home, the water is part of his personal property that can be subjected to his claim for injunctive relief. 

Deemed "the carpet capital of the world," nearly 90% of the world's carpet has been produced in Dalton, Georgia, since the 1990s.

“But the title and boast say nothing about any pollution resulting from all of that carpet production,” wrote Senior U.S. Circuit Judge Edward Carnes, a George H.W. Bush appointee, in Wednesday’s ruling. 

The wastewater produced from these facilities is collected and treated by Dalton Utilities and then travels down the Oostanaula River and supplies drinking water to the city of Rome. But in 2016, the city began to notice that the water was contaminated with dangerously high levels of PFAS, polyfluoroalkyl substances, also known as "forever chemicals."

These chemicals are widely used by carpet manufacturing facilities for their ability to repel stains, but they take a long time to break down and in high amounts can have harmful effects on human health, including decreased fertility and developmental delays in children.

Rome was forced to implement an emergency filtration process and cover the costs of the special filtration system, then invoked a surcharge on the price of water for all ratepayers. It estimates that the rate will increase at least 2.5% each year for the foreseeable future.

Although other aspects of the case are still proceeding, Dalton Utilities appealed an order by the district court denying its motion to dismiss Johnson's nuisance abatement claim. It argued that sovereign immunity shields municipal entities, such as the city commissioners operating the facility, from liability unless waived by the Georgia General Assembly or the state's constitution.

Relying on precedent from the Georgia Supreme Court, counsel for Dalton Utilities contended that municipalities are immune from a nuisance claim unless it seeks monetary relief for taking or damaging private property.

However, the 11th Circuit declared that this precedent does not surpass the common law that was established as a result of a 1968 case in which the town of Fort Oglethorpe was held liable for knowing about and allowing a defective traffic light to continue operating, which resulted in several car collisions.

That decision expanded the scope of municipal liability for nuisance claims “to include personal injuries beyond those tied to the plaintiff’s property," according to the ruling.

According to the three-judge panel, Town of Fort Oglethorpe v. Phillips was "the last word on the subject from the Georgia Supreme Court before the Georgia Constitution was amended in 1974 to essentially freeze in place the common law doctrine of sovereign immunity and the decisions involving it." The panel noted that Georgia’s highest court has cited the precedent favorably and often, even after the constitutional amendment. 

Johnson asked the appeals court to reject Dalton Utilities’ appeal, arguing that the district court’s decision was not a final order and therefore the 11th Circuit lacked jurisdiction on the matter. But the circuit judges disagreed, ruling that any order denying sovereign immunity is immediately appealable, even if a final court order has not yet been reached.  

 “The district court has authority to proceed forward with portions of the case not related to the claims on appeal,” Carnes wrote.

Carnes was joined on the unanimous panel by U.S. Circuit Judges Robert Luck and Andrew Brasher, who were both appointed by Donald Trump.

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