June 10, 2019 / 1:58 PM / 10 days ago

UPDATE 2-U.S. Supreme Court to hear BP unit's dispute over Montana Superfund site

(Adds background to case, action in similar case, paragraphs 6-11)

By Andrew Chung

WASHINGTON, June 10 (Reuters) - The U.S. Supreme Court on Monday agreed to a hear a bid by a unit of British oil major BP Plc to avoid a lawsuit by private landowners in Montana seeking to force the company to pay for a more extensive cleanup of a Superfund hazardous waste site than what federal environmental officials had ordered.

The justices took up Atlantic Richfield Co's appeal of a lower court ruling allowing a lawsuit by a group of property owners within the sprawling site of its former Anaconda copper smelter in western Montana to proceed to trial. Atlantic Richfield already has spent $470 million on soil and ground water restoration at the site ordered by the U.S. Environmental Protection Agency.

The company, which is backed by industry groups including the U.S. Chamber of Commerce and the National Association of Manufacturers in the case, has said the lower court's decision could lead to thousands more lawsuits nationwide against companies and further complicate federally mandated improvements to contaminated land.

The Superfund program, started in 1980, is intended to identify contaminated sites and ensure that those responsible for the pollution pay for the hazardous waste cleanup. It has been criticized over the years for slow efforts.

The Anaconda smelter, near the small community of Opportunity, Montana, operated between 1884 and 1980 and provided much of the world's copper supply. It was designated a Superfund site in 1983 to reduce arsenic contamination in residential yards, pastures and ground water.

The landowners sued in state court to restore their properties to pre-smelter conditions. Atlantic Richfield said such state law claims were barred by the EPA's actions under the 1980 Superfund law, called the Comprehensive Environmental Response, Compensation and Liability Act.

The company also said the suit was prohibited under the U.S. Constitution's so-called Supremacy Clause, which holds that federal law generally trumps state law.

In 2017, the Montana Supreme Court, the state's highest court, ruled against Atlantic Richfield, allowing the case to move forward. Appealing to the Supreme Court, Atlantic Richfield said that decision could undermine the already-complex Superfund regime and leave companies open to thousands more lawsuits. It also could be forced to redo its work at the Anaconda site, the company said.

"This is the very definition of madness," the company said in a legal brief.

President Donald Trump's administration has said the Montana court improperly ruled in favor of the landowners but agreed that the case should proceed to trial before the justices hear it.

Also on Monday, the Supreme Court declined to hear an appeal by Canada's Teck Resources Ltd of a lower federal court's decision holding the company liable under the Superfund law for pollution that settled in Washington state from a smelter in British Columbia. The company said the law cannot be applied outside U.S. borders.

Reporting by Andrew Chung; Editing by Will Dunham

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