Fishman Haygood Successfully Argues for Sizable Geographic Boundaries & Against Testing Requirement in Fight to Restore Clean Drinking Water in St. Croix

On July 20, 2023, the Honorable Wilma A. Lewis of the U.S. District Court of the Virgin Islands (St. Croix Division) issued a Second Phase Memorandum Opinion establishing the scale, structure, and implementation of a water distribution program that will provide clean drinking water to eligible residents of St. Croix. At the second phase hearing, the Fishman Haygood team worked to ensure that as many people as possible can participate in the program by successfully arguing for the inclusion of an area consisting of 10,000 residents and against a burdensome testing protocol proposed by the Defendant, Limetree Bay Terminals. Click here to read the ruling.

In spring 2021, thousands of residential properties in St. Croix, including private cisterns used for household drinking, bathing, and washing, were contaminated by several unpermitted air releases from the improperly restarted Limetree Bay Refinery. After at least three prior emission events, and upon a release on May 12, the Environmental Protection Agency (“EPA”) issued an emergency order that required the refinery to discontinue its operations immediately.

Following the 2021 releases and its subsequent closure, Limetree Bay Refinery filed bankruptcy. However, the refinery was part of an integrated terminal and oil storage facility owned and operated by a related entity, Limetree Bay Terminals, that did not file bankruptcy. Fishman Haygood pursued injunctive relief on behalf of impacted residents against the company, now operating under the name Ocean Point Terminals.

The matter then was divided into two phases, the first to determine whether the Plaintiffs were entitled to such relief, and—if so—what form it would take. With many residents unable to afford clean water, as well as the Court’s determination that Limetree Bay Terminals was responsible for the entire facility under permits issued pursuant to the Clean Air Act (“CAA”), Judge Lewis ruled that impacted residents who could not purchase water without having to trade off other basic necessities are entitled to injunctive relief through a water distribution program orchestrated by Terminals. Read more about the week-long phase one hearing held earlier this spring here.

Based on the outcome of the first phase, the second phase hearing was set to determine both the water distribution program’s scope and establish the economic and geographic eligibility criteria required of applicants. The Fishman Haygood team argued for the inclusion of impacted properties across a more sizable geographic area, to which the judge largely agreed.

Additionally, Terminals asked that the Court impose “testing protocol” that would require these eligible households to pay to test their cisterns for contamination as a condition of their participation in the water program; in cases where contamination was not detectable, the Defendant argued that households should be disqualified from program participation and the testing fee forfeited. Noting that imposing test costs on even some of St. Croix’s indigent population would prove fatal to the program, as well as its concern that program disqualification might signal to residents that cistern water is safe to drink, as opposed to it being “‘not unsafe’ to a reasonable degree of certainty,” the Court ruled that testing was unwarranted.

Fishman Haygood environmental litigators Kerry MillerRebekka VeithHogan Paschal, and Carly Jonakin represented the Plaintiffs in the first and second phase hearings. The team now seeks to hold accountable all involved in the fateful start-up of the refinery, including private equity heavyweights Arc-Light Capital Partners and EIG Global Energy Partners, in the damages portion of the case, so that affected residents may be compensated.

Click here to learn more about Fishman Haygood’s Environmental team.