Radioactive Contamination Lawsuit Against U.S. Navy Sinks

The United States Court of Appeals for the Ninth Circuit recently upheld the dismissal of a Federal Tort Claims Act (FTCA) lawsuit filed by current and former San Francisco Police Department (SFPD) employees. The plaintiffs had alleged that the United States, through the Department of the Navy, misled the City of San Francisco and the SFPD about the safety of a contaminated former Naval shipyard leased by the city for use as a police facility.

For now, this means the lawsuit is stopped in its tracks. Let’s take a look at the case from decades ago, and what was at stake.

Superfund Not Super Fun

Hunters Point Naval Shipyard, a 965-acre former naval base along the San Francisco Bay, was a key site for the Naval Radiological Defense Laboratory during the Cold War, where research and decontamination of radioactive vessels used in nuclear weapon tests were conducted. In 1989, the Environmental Protection Agency (EPA) designated the shipyard as a "Superfund" site.

A Superfund site is a contaminated location that has been designated by the EPA for cleanup because it poses a risk to human health or the environment. These sites are part of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), which was enacted in 1980. The Superfund program identifies and prioritizes sites for cleanup and works to hold responsible parties accountable for the contamination. If responsible parties cannot be found or are unable to pay for the cleanup, the EPA uses funds from the Superfund trust to carry out the necessary remediation activities.

Typical contaminants found at Superfund sites include hazardous waste, toxic chemicals, heavy metals, and other pollutants that can harm the environment and human health. The goal of the Superfund program is to clean up these sites to a level that is safe for people and the environment.

With the Hunters Point shipyard, the designation as a Superfund site meant that the site needed extensive remediation before it could be used again.

A Negligent Cleanup Job?

The Navy, in collaboration with the EPA and California state entities, established a remediation schedule. As part of the effort, the Navy contracted with a company called Tetra Tech to plan and oversee testing, investigation, and cleanup activities at the site.

But according to the lawsuit that would come later, the Navy failed to properly supervise Tetra Tech in doing so, and even more egregiously, that Tetra engaged in extensive fraud. This fraud allegedly involved falsifying data and reports related to the testing and cleanup of hazardous substances, which contributed to the ongoing contamination issues at the site.

Despite these alleged failures and fraudulent activities, the Navy proceeded to negotiate a lease of the Building 606 Property at the shipyard to the City of San Francisco for use by SFPD. By misrepresenting the safety of the site, the Navy essentially lead to the exposure of SFPD employees to contamination.

Allegedly, the SFPD employees were exposed to "radiological and non-radiological contamination" at the shipyard. "Radiological contamination" is more commonly called "radioactive contamination." As a result of this exposure, they allegedly suffered health problems and faced an elevated risk of developing life-threatening diseases.

SFPD Files Lawsuit

Thus, in 2020, current and former SFPD employees and family members filed a lawsuit against the federal government, alleging that it misled the City of San Francisco and the SFPD about the safety of the shipyard. The complaint included various claims of negligence, such as negligent undertaking, failure to warn, supervision, and most relevant here, negligent misrepresentation.

There was significant back and forth at the lower courts primarily because of the complex legal arguments surrounding the application of the FTCA and an exception baked into the statute. The government argued that the legal claim fell outside the waiver of sovereign immunity under the FTCA because of the misrepresentation exception. This is a provision that exempts the United States government from liability for claims arising out of “misrepresentation, deceit, or interference with contract rights.” This means that if a claim against the government is based on the communication of false information, whether negligent or intentional, it is barred by this exception.

The district court kept ruling that the claims were barred by the FTCA’s misrepresentation exception, thus dismissing the case, so the plaintiffs appealed to the Ninth Circuit Court of Appeals.

Ninth Circuit Says Suit Barred

The Ninth Circuit held that the plaintiffs' claims were barred by the FTCA’s misrepresentation exception because the claims arose out of the Navy’s alleged misrepresentations about the safety of a contaminated former Naval shipyard. The exception is interpreted broadly to include any claim that originates from or is connected to a misrepresentation by the government. Courts look at whether the misrepresentation is the "essence" or "gravamen" of the plaintiff’s complaint. If the alleged misrepresentation is central to the claim, the misrepresentation exception applies, even if the false information was not directly communicated to the plaintiff but to a third party.

The plaintiffs argued that the FTCA’s misrepresentation exception should not apply because the alleged misrepresentations about the safety of the shipyard were made to third parties (the City of San Francisco and the SFPD) rather than directly to the plaintiffs, meaning they did not personally rely on the false information. The court rejected this argument, holding that the misrepresentation exception applies to any claims "arising out of" misrepresentation, regardless of whether the misrepresentation was made directly to the plaintiffs, and that the plaintiffs' claims were fundamentally based on the Navy’s alleged misrepresentations. The court also rejected the plaintiffs' argument that the CERCLA implicitly limited or suspended the FTCA’s misrepresentation exception.

Ultimately, the court affirmed the district court's dismissal of the plaintiffs' complaint for lack of subject matter jurisdiction. This means that unless there is an appeal to the U.S. Supreme Court, the affected members of the SFPD will not be able to recover from any harm coming from their exposure at the shipyard.

Related Resources:

• Lessons Learned the Hard Way - Environmental Law (FindLaw's Learn About the Law)
• Legal Responsibility for Toxic Exposure (FindLaw's Learn About the Law)
• Justice Delayed for Poisoned Patriots at Camp Lejeune (FindLaw's Courtside)