Back in the halcyon days of 2013, a ship sank, and your author was tasked with overseeing the legal aspects of its removal - drawing up a contract with the salvor and all that stuff. And it went really well, all things considered: the boat was removed on a timely basis. But there was one small hiccup. A pollution-response vessel was hired to make sure the sunken vessel was marked and wasn’t leaking hydrocarbons, but it, according to the folks who hired it, didn’t do its job all that well. In fact, it lost the boat, and the salvor charged extra to find it. So the pollution-response vessel didn’t get paid for the work they didn’t do.
The pollution response folks got all angry and they said “give us our money” and your author, with client agreement, said “no” and then they submitted a claim to the National Pollution Funds Center, which is a creature of OPA-90. The NPFC is supposed to pay claims for pollution work, but only sometimes, and there are regulations about that. Your author said to the NPFC “Don’t pay this because [reasons]” and then nothing happened. And then, back in 2017 or so, the NPFC sent a letter to your author and said “hey remember this thing? Well we paid it and now you[r client] owes us the money so tell them to pay.
It turns out they weren’t owed the money because there’s a three-year sunset on that, but there is an infinite timeline on administrative offsets. But anyway the NPFC wanted the money and didn’t want to settle, and so suit was joined and we were off to the races.
Cross-motions got filed a long time ago and just recently, the court ruled. There were a bunch of issues, but as it happens, the decisive issue was a regulation that says this:
The amount of compensation allowable is the total of uncompensated reasonable removal costs of actions taken that were determined by the FOSC to be consistent with the National Contingency Plan or were directed by the FOSC. Except in exceptional circumstances, removal activities for which costs are being claimed must have been coordinated with the FOSC.
I argued that there were no exceptional circumstances, and there was no FOSC (Federal On-Scene Coordinator) for this removal. There was no FOSC because it was private parties. And because of that, I argued, we win. I’ll send you the brief if you’d like to read it. There were some other arguments, but the upshot is the judge agreed with us and we won!
There is a fun little administrative law quirk here. While the case was pending, the Supreme Court, uh, clarified (read: nearly killed) Auer. Auer is a case that says agencies get deference in interpreting their own regulations. The Supreme Court ruled in Kisor v. Wilkie that agencies do get deference, kind of, sometimes, but it is limited. And so the NPFC/Coast Guard argued that they get deference to argue what is and what is not ‘exceptional’. And this is one of the first cases interpreting Kisor, which is kind of cool. The Court ruled that the regulation is in fact ambiguous, but that the Coast Guard’s interpretation was not reasonable so it did not get deference.