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In re Gold King Mine Release in San Juan County

United States District Court, D. New Mexico

March 28, 2019

IN RE GOLD KING MINE RELEASE IN SAN JUAN COUNTY, COLORADO, ON AUGUST 5, 2015 This Document Relates to: Nos. 1:16-cv-00931-WJ-LF, 1:17-cv-00710-WJ-SCY

          MEMORANDUM OPINION AND ORDER

          WILLIAM P. JOHNSON CHIEF UNITED STATES DISTRICT JUDGE.

         THIS MATTER comes before the Court on Defendant Gold King Mines Corporation's (“Gold King”) Motion to Dismiss and Supporting Memorandum, Doc. 52, filed August 8, 2018.

         The Court allowed Gold King Mines Corporation (“GKMC”) to join in and file a supplement to the Mining Defendants' (Sunnyside Gold Corporation, Kinross Gold U.S.A. Inc., and Kinross Gold Corporation) motion to dismiss. GKMC moves to dismiss the McDaniel Plaintiffs and Navajo Nation's amended complaints and states “[w]hile GKMC is a party in the Utah matter, because a default judgment has entered there is no issue to address in this Court as it relates to that action.” Doc. 52 at 1. GKMC incorporates the arguments made and authority relied upon in the Mining Defendants' motion to dismiss. The Court denies much of GKMC's motion for many of the same reasons it denied similar requests in the Mining Defendants' motion to dismiss.

         Personal Jurisdiction

         GKMC moves the Court to dismiss the Navajo Nation and the McDaniel Plaintiffs' Complaints for lack of personal jurisdiction. GKMC states that the Navajo Nation's Amended Complaint “asserts the activity at issue is the EPA and its contractors' conduct on August 5, 2015, which occurred a decade after GKMC had any ownership or control over the site or any property in the watershed.” Doc. 52 at 7. GKMC contends that the “facts alleged in the [Navajo Nation and McDaniel Plaintiffs'] Amended Complaints cannot establish a prima facie case of purposeful direction . . . [or] that Plaintiffs' cause of action arose out of GKMC's alleged conduct.” Doc. 52 at 7-8.[1]

         The Navajo Nation and the McDaniel Plaintiffs have alleged sufficient facts to make a prima facie showing of personal jurisdiction over GKMC. The Navajo Nation alleged that GKMC had responsibility for operating Sunnyside Gold's treatment facility, “Sunnyside Gold formally transferred ownership of the treatment facility and its discharge permit to” GKMC, GKMC “continuously neglected its obligations to control the discharge of wastewater from its properties and to operate the treatment facility to protect the water entering the Animas and San Juan River, ” GKMC “exceeded its discharge limits at the Gold King Mine, ” and GKMC resorted to diverting untreated discharges from the American Tunnel and Gold King Mine directly into Cement Creek[, a tributary of the Animas River].” NN FAC ¶¶ 50, 52-53. The McDaniel Plaintiffs alleged that the Defendants, including GKMC, “negligently and grossly negligently maintained an abandoned gold mine dam, ” “knew or should have know that there was a substantial risk of a blowout, ” “owed a duty to the Plaintiffs to conduct, regulate, maintain, and oversee the operations, investigations, and conditions at the Gold King Mine in a reasonable manner and with reasonable care, ” and “[f]ailure to exercise reasonable care in these circumstances pose a foreseeable risk of harm to the Plaintiffs downstream.” McDaniel Second Amended Complaint ¶¶ 31, 32, 48.

         Barred by Statute of Limitations

         GKMC asserts that “[w]here there is a transboundary contamination incident, the applicable law is that of the source state, ” that the “Colorado period of limitations in a tort case is two years from the occurrence of the tort, ” that “GKMC has not been involved with the Gold King Mine since 2005, ” and “therefore the state law claims as it relates to GKMC are barred under Colorado's Statute of Limitations.” Doc. 52 at 7.

         GKMC incorrectly states that the Colorado period of limitations is two years from “the occurrence of the tort.” Colorado law states a civil action “must be commenced with two years after the cause of action accrues.” C.R.S.A. § 13-80-102(1). A cause of action is “deemed to accrue when the injury, loss, damage, or conduct giving rise to the cause of action is discovered or should have been discovered by the exercise of reasonable diligence.” C.R.S.A. § 13-80-108(8).

         New Mexico law provides that causes of action regarding “injuries to property” must be brought “within four years, ” “after their causes accrue, ” and that a “cause of action shall not be deemed to have accrued until the . . . injury . . . complained of, shall have been discovered by the party aggrieved.” N.M.S.A. §§ 37-1-1, 37-1-4 and 37-1-7.

         The Navajo Nation and the McDaniel Plaintiffs filed their original Complaints against GKMC on August 16, 2016, and July 7, 2017, respectively. The causes of action against GKMC did not accrue until some time after the August 5, 2015, release when the Navajo Nation and the McDaniel Plaintiffs discovered the injuries of which they complain. Consequently, the Navajo Nation and McDaniel Plaintiffs' claims are not barred by the statute of limitations under Colorado or New Mexico law.

         Clean Water Act

         GKMC states the “Clean Water Act preempts any claims based upon the law of the affected state.” The Court grants GKMC's motion to dismiss the McDaniel Plaintiffs and the Navajo Nation's tort claims as preempted by the Clean Water Act to the extent the McDaniel Plaintiffs and the Navajo Nation seek to assert those claims under the law of any state other than Colorado. See Doc. 52 at 9; see also Mem. Op. and Order at 3-4, Doc. 168, filed March 26, 2019 (discussing preemption of non-source state law and granting the Mining Defendants' motion to dismiss the Sovereign Plaintiffs' tort claims as preempted by the Clean Water Act to the extent the Sovereign Plaintiffs seek to assert those claims under the law of any state other than Colorado).

         State of Colorado ...


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