Judge Advances Lawsuits Challenging Bay Area City Coal Ban

In this photo, sunlight reflects off of a chunk of coal. (AP Photo/Patrick Semansky, File)

OAKLAND, Calif. (CN) — A federal judge on Thursday advanced three lawsuits claiming a Bay Area city’s ban on the handling and storage of coal and petroleum coke is based on faulty science, preempted by federal laws and interferes with foreign and interstate commerce.

The city of Richmond, California, passed an ordinance banning coal and petcoke this past February to “protect and promote the health, safety and welfare of the city’s citizens, visitors, and workers by reducing the release of pollutants into the environment.”

The ordinance was met with three lawsuits filed by Levin Enterprises, which operates a marine terminal and railroad that transports coal and petcoke; Philips 66, which operates a petcoke refinery 10 miles from Richmond; and Wolverine Fuel Sales, which mines coal in Utah.

In a 26-page ruling issued Thursday, U.S. District Judge Yvonne Gonzalez Rogers refused to dismiss the bulk of claims asserted against the city in the three federal complaints.

The judge refused to accept arguments that the health and safety benefits of the city’s coal ban outweighs any potential burden it may impose on interstate commerce. The plaintiffs claim the city lacked reliable scientific evidence to support the new restrictions.

“While the court must give appropriate deference to the legislature’s judgment, it is not a rubber stamp for the city’s adoption of the ordinance,” Gonzalez Rogers wrote.

The judge concluded that addressing that question will require analyzing a full record of evidence at a later stage of the litigation.

The judge also refused to dismiss claims that the coal ban will interfere with foreign commerce by effectively halting overseas shipments of fossil fuels from the Richmond terminal to Europe, Australia and Asia.

Gonzalez-Rogers found there were “specific indications of Congressional intent to regulate the overseas trade of commodities like coal and petcoke.”

Claims that the coal ban interferes with business contracts were also advanced. The judge refused to accept the city’s assertion that the ordinance was “reasonable and necessary” and therefore outweighs any adverse impacts on business contracts.

The lawsuits claim the ordinance was not reasonable or necessary because the only reliable environmental tests showed no hazardous air pollution coming from the terminal.

The Richmond Planning Commission found the ordinance unsupported by reliable scientific evidence and recommended against passing it. The Bay Area Air Quality Management District complained of a lack of dependable data to support the coal ban, and a microscopic analysis relied on by the city was “riddled with scientific errors” and did not clearly identify the terminal as the source of sampled dust, Gonzalez Rogers wrote.

The judge also found the coal ban could be preempted by two federal laws –the Interstate Commerce Commission Termination Act of 1995 and the Shipping Act of 1984.

The ICCTA gives the U.S. Surface Transportation Board sole authority over transportation by rail as part of an interstate rail network. It preempts any laws that unreasonably burden or interfere with such rail transportation.

The Shipping Act prohibits state and local laws that “unreasonably discriminate” against shippers of certain commodities, such as coal or petcoke.

Determining whether the coal ban is preempted by those laws will require a more thorough analysis of evidence at a later stage of litigation, the judge concluded.

Gonzalez Rogers also refused to dismiss claims that the ordinance violates the companies’ due process rights based on claims that city officials failed to fully consider the reliability and adequacy of evidence supporting the ban.

Additionally, the judge advanced claims that the ordinance represents an unlawful taking of the Levin Enterprises’ property. The shipping terminal operator says because there are few alternatives to shipping coal and petcoke, the ban is likely to put it out of business.  

Equal protection claims asserted by Levin Enterprises were also advanced. The Levin-Richmond Terminal is the only facility affected by the ordinance. It claims the city singled it out “arbitrarily without any rational basis” so as to interfere with its property rights.

The judge also granted a motion by two environmental groups, Sierra Club and San Francisco Baykeeper, to intervene in the case as defendants, but she also placed limitations on their roles in the case. The conservation groups will not be allowed to file motions independently from the main defendant, the city of Richmond.

Richmond interim City Attorney Rachel Sommovilla and Levin Enterprises attorney Linda Sobczynski of Farella Braun Martel did not immediately return email requests for comment Thursday.

The decision to advance three lawsuits challenging the Richmond ordinance comes three months after the Ninth Circuit upheld another federal judge’s decision to overturn the city of Oakland’s ban on coal and petcoke in May.

%d bloggers like this: