Enviroterrorism: A Long-range View
As anyone who visits an airport or a government building these days can attest, the events of September 11, 2001, and thereafter have resulted in a number of significant changes to both personal and business behavior. More long-term changes doubtlessly will occur as the risks of future terrorist events are recognized and assimilated into the nation's economy and legal system. This seems particularly true in the areas of environmental protection and regulation, which are at the front line of the war on terrorism.
Terrorism through the release of biological, chemical and radiological agents is predicated upon use of the environment as a medium or weapon of mass harm and destruction. As a group, such acts can be referred to as enviroterrorism. (This term should be distinguished from ecoterrorism, which has frequently been used to describe crimes committed allegedly to protect the environment.) Measures and technology aimed at preventing or mitigating enviroterrorism could eventually become a standard part of the national pollution control strategy.
It is much too early to assess the full dimensions of the coming long-term legal challenges posed by enviroterrorism, but it seems prudent to try to anticipate them and to be positioned to confront them efficiently and effectively. The following list (in no special order) is an effort to anticipate potential areas of long-term legal change in the fields of environmental protection and regulation, and in some cases, to suggest strategies that may prove helpful in preparing for it. It also is a modest prototype for the kind of global checklist that corporate managers will want to develop in planning how they will prepare and respond to the new realities.
Measures and technology aimed at preventing or mitigating enviroterrorism could eventually become a standard part of the national pollution control strategy.
New Environmental Permitting/Performance Standards
Air quality, water quality and waste management permits and programs (including asbestos) often provide for prudent (including best) management practices or contingency/emergency plans in the operation of permitted facilities. Future permit writers or agency enforcement officers could possibly require permittees or other regulated entities to evaluate potential risks to workers and the public posed by potential terrorist activities (e.g., catastrophic chemical releases, contamination or interruption of drinking water supplies, pollution control equipment outages) and to design practices or equipment that will serve to prevent or minimize human and environmental impacts caused by the uncontrolled release of, and exposure to, toxic or hazardous substances.
It is not unimaginable that anti-terrorist measures could be incorporated into technology-based pollution control standards under the Clean Air Act and Clean Water Act. (Among other industries, pesticide/fertilizer production and application operations and pharmaceutical research may also come under special regulatory scrutiny from the perspective of potential enviroterrorism risks.) The trend toward tighter regulatory oversight related to the new threats already is well underway in the nuclear power industry, and the logic of augmented regulatory controls will easily expand beyond that industry.
For example, it is notable that, with the strong encouragement of the U.S. Environmental Protection Agency (EPA), many of the nation's public drinking water and wastewater management systems are reportedly in a heightened state of readiness to face the new threats. According to EPA's Water Protection Task Force, 82 percent of the population receives drinking water from large utilities serving 10,000 people or more. In addition, EPA's task force observes that 73 percent of the population receives wastewater treatment from 16,000 publicly owned treatment works, and there is a related network of about 600,000 miles of municipal sewers. Among other things, these systems are potentially vulnerable to the introduction of chemical and biological agents and simple physical destruction.
Numerous manholes throughout the wastewater system offer convenient points of entry for physical, chemical or biological sabotage. Vulnerabilities in related infrastructure such as electric power, telecommunications and computerized control systems also threaten water delivery systems. Moreover, large quantities of hazardous chemicals, such as chlorine and sulfur dioxide, are typically used in connection with these systems, and a liquid or gaseous release of such chemicals -- say, by attacking rail cars or delivery systems -- could do serious harm to surrounding communities. (See "Protecting Our Nation's Drinking Water and Waste Water Systems From Terrorism," at www.epa.gov/ost/humanhealth/microbial/proceedings/protection/.) It can be expected that the strategies for coping with these threats will become commonplace in both public and private sectors.
CERCLA/Clean Water Act/RCRA Liability
Could facility owners or operators become liable for cleanup of hazardous substance releases under Section 107 of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), the federal Superfund environmental cleanup law) even though such release was caused solely by the acts of a third party with whom the owner or operator does not have a contractual relationship (i.e., a terrorist)? (See Section 107 (b) of CERCLA.) Such liability seems possible if, among other things, the owner or operator cannot establish by a preponderance of the evidence that it took precautions against foreseeable acts or omissions of any such third party and the consequences that could be foreseeable result from such acts or omissions. (See section 107 (b)(3)).
It is not unimaginable that anti-terrorist measures could be incorporated into technology-based pollution control standards under the Clean Air Act and Clean Water Act.
The owner or operator, however, also may possibly escape cleanup liability to the extent that it can establish that the release and the resulting damages were caused solely by an act of war under Section 107 (b)(2). Section 311 of the federal Clean Water Act presents similar liability and defense issues in connection with releases of oil or hazardous substances into waters of the United States. In addition, releases of solid or hazardous waste may give rise to strict liability for cleanup under various provisions of, and rules under, the federal Resource Conservation and Recovery Act (RCRA) and corresponding state programs.
Worker Safety and Health
This indoor environment area is one of the most obvious ones in need of evaluation in light of reasonably foreseeable risks posed by terrorism (e.g., mail room anthrax risks). Moreover, the general duty clause in Section 5 (a)(1) of the federal Occupational Safety and Health Act (OSH Act) could, at least in theory, expose employers to liability for failure to protect workers from foreseeable acts of terrorism even in the absence of specific regulations. (That section generally requires employers to furnish a workplace that is free from recognized hazards that are likely to cause death or serious physical harm to employees.) For these reasons, as well as others, anti-terrorist evaluations or audits may make increasing sense in the area of worker safety and health protection. Proactive companies also may want to participate in industry consensus groups that seek to develop anti-terrorism practices in the workplace.
Other Statutory Duties
Similar to Section 5 (a)(1) of the OSH Act, Section 112 (r)(1) of the federal Clean Air Act imposes a general duty on regulated owners and operators to identify and prevent potential accidental (i.e., unanticipated) releases of designated hazardous substances, design and maintain a safe facility and minimize the consequences of releases that do occur. Moreover, section 113 (c)(4) of the federal Clean Air Act imposes, under certain circumstances, criminal liability for negligent releases of designated hazardous air pollutants or extremely hazardous substances.
Could industrial facility operators become civilly or criminally liable for catastrophic releases of hazardous substances caused by terrorist actions that are reasonably foreseeable and might have been prevented, or at least minimized, through exercise of due care? Ordinarily, such liability would not be expected, especially in view of the uniquely extenuating circumstances and available legal defenses in the context of criminal statutes. Civil liability for regulatory violations caused by terrorist actions also should be remote. (See, for example, 30 Texas Administrative Code Section 70.7, entitled "Force Majeure." That provision explicitly excuses regulatory violations caused solely by, among other things, acts of war.) But might there be a set of facts where normal expectations or defenses would not be justified or controlling, as for example, in a case where mass injuries were caused by a terrorist action that could have easily been anticipated and prevented? Who wants to be the test case? Consequently, it appears desirable to exercise due diligence in anticipating and addressing threats that could have regulatory consequences.
Common Law Duties
Common law duties are generally non-statutory duties of due care between and among individuals that courts traditionally define and enforce in the context of personal injury or property damage lawsuits. Common law negligence claims typically turn on whether or not a defendant exercised due care in connection with acts or omissions that have resulted in injury or damage to a plaintiff. Now that the average person is on full notice about the possibility of terrorism, is it reasonable to expect that companies will evaluate their activities and operations in light of reasonably foreseeable terrorism-related dangers to their employees, customers, vendors and the public? Will common law standards of care one day encompass a duty to minimize harm to people and property after a terrorist act the same way standards evolved decades ago in connection with the "crashworthiness" of automobiles? In response to such questions, it seems prudent to consider reasonable precautions necessary to avoid or minimize such dangers. Anti-terrorism audits might one day become a significant liability prevention tool just as environmental audits are now, at least in certain industries. Indeed, at least one major insurance carrier already has reportedly offered terrorism risk evaluation guidance.
Releases of solid or hazardous waste may give rise to strict liability for cleanup under various provisions of, and rules under, RCRA and corresponding state programs.
There is a growing body of literature on analysis of, and planning for, terrorism risks in the industrial setting. In the May 2002 issue of Environmental Protection (Vol. 13, No.5, page 19), Dr. Jim Zeigler's article, "Invitation To Environmental Disaster," provides a thoughtful discussion of practical risks posed by weapons of mass destruction ("WMD") (i.e., biological, chemical and radioactive), as well as strategies for evaluating and dealing with them. According to Dr. Zeigler, "Prudent managers will be wise to consider the effects of a terrorist incident when updating their EHS programs. As with any threat to the safety and environment of a plant community, the WMD hazard is best handled with a structured plan that addresses both prevention and incident management."
Building/Facility Security, Maintenance and Design
Clearly, the new realities prompt the need for companies to re-examine their building/facility security measures, particularly in industries with high risk processes (e.g., certain types of chemical production) and those handling especially hazardous materials (e.g., munitions and explosives). For example, at high risk facilities, adequately-trained armed guards and augmented electronic surveillance may be appropriate. Maintenance programs also will need to adapt and incorporate measures to prevent or foil terrorist acts, including things such as inspection and alteration of ventilation systems and monitoring of indoor air quality. Closer landlord scrutiny of tenant activities may become appropriate. Furthermore, building design, construction code and fire code conventions may need to change to incorporate features needed to, among other things, detect intruders, prevent tampering with, or misuse of, utilities, equipment, or telecommunications and ventilation systems and to facilitate speedy evacuation.
Insurance historically has been a basic risk management tool, although it is too early to fully assess how the insurance markets will ultimately adapt to future business risks posed by terrorism. Rates for, and availability of, terrorism coverage (including renewals) are reportedly becoming increasingly unfavorable to business. Legislation currently pending in the U.S. Congress would provide a measure of federal reinsurance protection, or "backstop," over terrorism coverage levels afforded by the private insurance industry, and further legislative developments might improve the coverage picture. It seems prudent, however, for company management to contact existing insurance carriers and discuss the scope of protection afforded by existing policies and what improved coverage might be obtained through new or different products. Commercial borrowers also will want to anticipate possible difficulties in securing loans, or refinancing, where lenders demand potentially costly and elusive terrorism coverage.
Allocating the risk of loss caused by acts of terrorism may become a more active area of negotiation in commercial transactions, product specifications (e.g., failure standards akin to crashworthiness) and real estate and equipment leases. Accordingly, commercial contract provisions and indemnities may need to be examined and negotiated in light of reasonably foreseeable liabilities arising out of terrorist acts. These same concerns will need to be considered in leasing and other types of agreements relative to commercial and industrial property.
Regulated businesses typically provide both routine and episodic reports to state and federal agencies regarding environmental releases and chemical management. More thought will have to be given by both government and the regulated community about what portions of these reports should be submitted and maintained subject to confidentiality claims based on public safety concerns rather than trade secret/confidential business information or national security grounds. Currently, most environmental reporting programs do not, or do not adequately, provide for confidentiality claims by regulated entities based on public safety concerns. The federal Freedom of Information Act does exempt documents in government files from mandatory public disclosure on public safety grounds, but only in connection with documents related to law enforcement. Further refinements to state and federal freedom of information laws may be deemed necessary to address the need to exempt certain information from public disclosure on public safety grounds.
The private sector may need to prompt reforms in these areas if governmental action is not forthcoming. That process will not be an easy one. There remains a delicate balance between security and the public's right to know about potential community hazards posed by chemical handling and storage. In her December 2001 editorial in Environmental Protection (Vol. 12, No.12, p.8), Angela Neville cogently frames the dilemma regarding public access to chemical information as follows: "How do we stop future terrorist acts against U.S. industrial facilities while at the same time preventing another Bhopal?"
Chemical and Product Handling, Storage and Transportation
Companies will need to re-evaluate their chemical handling, product storage and transportation practices to determine if refinements are feasible and desirable to minimize safety risks. A number of industries exempted under EPA chemical accident prevention and OSHA process safety management programs may nevertheless elect to use those programs as guidebooks for their operations. Other steps may include improvements in inventory control (quantity of material on-hand), storage practices, packaging and changes in proximity to potentially exposed off-site populations (e.g., residences, schools and hospitals) and/or on-site facilities. Corporate managers may also want to scrutinize transportation companies with whom they do business to determine what precautions such transporters are taking, including insurance coverage, security measures, employee oversight and pre-employment screening practices. The same type of scrutiny also may be worthwhile in connection with other contractors that provide, among other things, site security, maintenance and housekeeping services. Contractual allocation of liability for terrorist-related transportation accidents or other incidents may need to be re-examined. Import/export agreements and relationships may need review from the same perspective.
Public companies in certain industries or locations may need to consider disclosing business risks associated with potential terrorist activity -- both domestically and overseas in their SEC Form 10K reports for the U.S. Securities and Exchange Commission (SEC). This will necessitate a careful balance between adequate disclosure on the one hand, and avoiding the creation of a roadmap to terrorists on the other. Moreover, in some cases, the costs associated with addressing such risks might be material enough to merit disclosure in SEC filings.
As stated at the outset, the preceding discussion is an exceedingly modest beginning to an appreciation of all the legal challenges that the nation will confront in the areas of environmental protection and environmental regulation. A great deal more legal analysis and creative thinking will certainly be necessary to both understand and respond to these challenges. In the meantime, an effective response, among other things, will entail (1) a detailed understanding of the real world risks presented by a given business activity, (2) a systematic evaluation of the possible damage and potential legal liabilities that could result when a risk becomes a reality, (3) the development of practical and legal safeguards calculated to prevent harm to human health and the environment under the identified risk scenarios and (4) the identification of practical and legal steps that can serve to mitigate adverse consequences when they occur.
This article originally appeared in the September 2002 issue of Environmental Protection, Vol. 13, No. 8, p. 24.
This article originally appeared in the 09/01/2002 issue of Environmental Protection.