Shell Let Off the Hook on Benzene Pollution

CHICAGO (CN) - Comparing the carcinogen benzene to unwanted earthworms, the 7th Circuit refused to let Roxana, Ill., property owners sue Shell Oil for pollution.

"There are many things commonly found in soil beneath rural or suburban houses that homeowners would very much like not to enter their home (such as earthworms, fungi, ants, beetles, slugs, radon, chemical residues, thousands of different types of microbe - and groundwater), but as long as there is no danger of such unwanted visitors their underground presence should not affect property values," Judge Richard Posner wrote for a three-judge panel (parentheses in original). "Benzene in the water supply is one thing; benzene in groundwater that does not feed into the water supply is quite another."

Roxana, a village of 1,550 in southern Illinois, sued Shell Oil in 2012 for polluting its groundwater and soil with benzene levels as much as 26,000 times greater than allowed by state law.

The complaint cited 18 known spills in the past 25 years from Shell's nearby refinery, one of the largest in the nation.

Though Shell noted that it ceased operating the site in 2003 with a sale to Tosco, 17 of the 18 incidents described in the complaint preceded the sale by over a decade. Shell said the site today is jointly owned by Phillips 66 and Cenovus Energy.

Benzene, a carcinogen, is used in gasoline production because it increases octane rating and reduces knocking. Long-term exposure to large amounts of benzene can cause leukemia. Exposure to lesser amounts of ethylbenzene can cause cancer and damage the inner ears and kidneys, the complaint states, citing the International Agency for Research on Cancer.

In September 2013, a federal judge certified a class of Roxana property owners who claimed that the high benzene levels from Shell's spills had lowered their property values.

But the 7th Circuit overturned that ruling Friday, warning against the assumption "that a decline in the value of residential property in Roxana (if in fact there's been a decline) is the result of proximity to a refinery that for all one knows has been leaking contaminants for the last 95 years without causing detectable harm." (Parentheses in original).

This link fails given the recent collapse of home prices, the nine-page opinion states.

Roxana's water supply comes from an uncontaminated aquifer, not from its groundwater, and there is no allegation that any of the plaintiffs use well water.

"The plaintiffs in this case have presented no theory, let alone credible evidence, of a connection between the leaks property values, or between specific defendants and the leaks and property values, that would justify a class action on behalf of all the property owners whose properties sit above groundwater that contains an amount of benzene considered dangerous to human health by regulatory authorities (more than 5 micrograms per liter) - if drunk," Posner wrote. "But, to repeat, there is, as yet anyway, no evidence that any of it is ever drunk." (Italics in original.)

On remand, the District Court must revisit the issue of certification with a focus on what common evidence plaintiffs intend to use to support their class allegations.

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