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Natural resource damages are rarely at the forefront of a potentially responsible party’s mind when that party enters an environmental remediation. When approaching a remediation, parties, as well as enforcement agencies, tend to focus on—you guessed it—remediating. But in many cases, a successful remediation does not account for restoration. And though the parties may not have coordinated a restoration plan as a part of the remediation, a number of federal and state statutes do account for restoration, under natural resource damages provisions. Accordingly, parties who fail to consider natural resource damages during the remediation may find that they are not out of the woods yet in terms of potential liability.

For this reason, parties should consider coordinating remedial and restorative efforts, in order to avoid unanticipated expenses for litigating and/or settling claims for natural resource damages. And, make no mistake, costs related to natural resource damages can be substantial. In fact, some claims for natural resource damages end in settlements that eclipse the cost of the remediation itself. See, e.g. Deepwater Horizon Consent Decree at ¶ 15-17, In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, Nos. 10-4536, 10-04182, 10-03059, 13-4677, 13-158, and 13-00123 (E.D. La. Apr. 4, 2016) (ordering $7.1 billion, plus $1 billion in accrued interest for natural resource damages alone). Thus, it is vital to have a basic awareness of natural resource damages.

Applicability of Natural Resource Damages

Five federal statutes authorize recovery for “Natural Resource Damages”:

  1. Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. 9607(f);
  2. Clean Water Act, 33 U.S.C. 1321(f);
  3. Oil Pollution Act (OPA), 33 U.S.C. 2702(a), (b)(2);
  4. National Marine Sanctuaries Act, 16 U.S.C. 1443(a)(1); and
  5. Park System Resource Protection Act, 16 U.S.C. 19jj.

The Forest Service also claims to have the authority to seek such damages under the Restoration of National Forest Lands and Improvements Act, though it does not explicitly reference the term “natural resource damages,” as noted by Karen Bradshaw in “Settling for Natural Resource Damages,” 40 Harv. Envtl. L. Rev., 211, 213–14 (2016).

These statutes, along with their state companion statutes, generally provide post-remediation recovery for costs to “make the public whole after environmental harm by restoring injured natural resources to their baseline conditions. The remedy is neither a fine nor payment for cleanup. Funds must be spent on restoration—they go directly to restoring the harmed resources.” Id.

Natural resource damages are broadly defined in these statutes. For example, CERCLA defines natural resources as “land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States … any State or local government … [or] any Indian tribe.” 42 U.S.C. 9601(16). OPA similarly defines natural resource damages to include “land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States (including the resources of the exclusive economic zone), any State or local government or Indian tribe, or any foreign government ….”

Statute of Limitations Defense

The statutes of limitation relating to natural resource damages can differ from statute to statute. For example, under CERCLA, an action for natural resource damages must be brought within three years of (a) “the date of discovery of the loss and its connection with the release in question,” or (b) “the date on which the regulations are promulgated.” 42 U.S.C. §9613. Importantly, there is no retroactive liability under CERCLA for natural resource damages occurring wholly before Dec. 11, 1980, the date CERCLA was passed. However, “the statute only excuses liability if the release and the damages both occur pre-enactment.” Coeur D’Alene Tribe v. Asarco, 280 F. Supp. 2d 1094, 1114, 57 Env’t. Rep. Cas. (BNA) 1610 (D. Idaho 2003), modified in part, 471 F. Supp. 2d 1063 (D. Idaho 2005). Accordingly, where a release took place prior to Dec. 11, 1980, but the “bulk of the damages” occur after Dec. 11, 1980, a defendant can still be found liable for natural resource damages.

Under OPA, and the remaining federal statutes, actions for such damages must begin within three years of the later of the date of discovery of the loss and its connection to the release, or the date on which damages regulations were promulgated. See 33 U.S.C. Sec. 2717(f)(1); see also,

Comparatively, at the state level, the New Jersey Brownfield and Contaminated Site Remediation Act at N.J.S.A. 58:10B-17.1, effective Dec. 21, 2005, extended the statute of limitations for natural resource damages to five years and six months. The statute goes on to explain that no cause of action for these damages shall be deemed to have accrued prior to Jan. 1, 2002, or until the completion of the remedial investigation of the contaminated site or the sanitary landfill facility, whichever is later. N.J.S.A. 58:10B-17.1b(2).

Note that the statute of limitations for natural resource damages is separate from the statute of limitations that applies to each of the above-mentioned environmental statutes.

Coordination of Remediation and Restoration

Due to the far-reaching applicability and effect of natural resource damages, the vast majority of these cases settle. See, Assessing Damages Resulting From Gulf Oil Spill: Hearing Before the S. Comm. on Env’t and Pub. Works, 111th Cong. 8 (2010) (statement by Cynthia Dohner). In 2010, a Department of Interior official testified before Congress that “more than 95 percent of [natural resource damages] claims are resolved cooperatively with court-approved settlements.”

“The data indicate that the United States has settled at least $10.4 billion in natural resource damages claims from 1989 through April 2016. $8.1 billion of the $10.4 billion come from the Deepwater Horizon settlement.” Karen Bradshaw, “Settling for Natural Resource Damages,” 40 Harv. Envtl. L. Rev. 211, 232 (2016). Notwithstanding the Deepwater Horizon settlement, which was three times as high as all other natural resource damages settlements, generally speaking, these claims can be settled for a reasonable cost, especially when compared with the high cost of litigation. Id.

Accordingly, it may be beneficial for a potentially responsible party subject to a statute providing for natural resource damages to proactively contemplate and settle concurrently with the remediation. Advantages of a proactive settlement as a part of remediation include: (1) information sharing; (2) an opportunity to test the strength of any defenses; (3) a decrease in the chance of an inflated assessment of the damages; (4) an opportunity to offer creative, and less expensive restoration alternatives; and (5) avoidance of expensive litigation.

The former Chief of the Damage Assessment Center at the National Oceanic and Atmospheric Administration (NOAA) explained, “it makes more sense, saves time and money, and is consistent with the regulatory framework for trustees and response agencies to conduct simultaneous assessments and coordinate remedial and restoration planning.” Bill Conner & Ron Gouguet, Getting to Restoration 24 (Envtl. Law Insl. 2004).

As an added benefit, the trustees, as part of any cooperative agreement, will generally agree in writing not to issue notice letters or commence litigation against the potentially responsible party during the effective period of the agreement. In return, the potentially responsible party will generally agree to toll the statute of limitations based on the period of the agreement.

NOAA recommends “that basic agreements and terms be somehow documented in writing to minimize future misunderstandings. This might be accomplished by a simple letter of agreement outlining the basic goals of the process or a more comprehensive project initiation agreement.” NOAA, CAP Compendium of Additional Ideas and Example Documents (Oct. 2003),

Natural resource damages cooperative agreements vary in size and scope, but often contain the following elements: (1) statements of principle, (2) funding arrangements, (3) tolling and standstill provisions, (4) termination provisions, (5) information sharing, and (6) reservation of rights. See, Natural Resource Damages, Brian D. Israel, Environmental Law Practice Guide (July 2006).

In conclusion, a cooperative approach to settling such claims under any of the applicable statutes, state or federal, provides myriad benefits to the potentially responsible party, and in many cases the enforcing agency. Potentially responsible parties should consider the likelihood of natural resource damages claims during the remediation process, and attempt to settle those claims simultaneously in the interest of efficiency and cost savings.


Marc D. Policastro is chair of the Environmental Department at Giordano, Halleran & Ciesla, P.C., in Red Bank and New York City. He is a transactional business attorney who focuses on development, redevelopment, environmental compliance, corporate transactions, land use, zoning and business counseling.