Environmental Due Diligence: An Essential Step in M&A Transactions

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Troutman Sanders LLP
Andrew J. Perel and M. Buck Dixon

September 1, 2019

This publication was originally published in the Troutman Sanders Law Blog

The risk of shortcutting environmental due diligence cannot be overstated. There is a tendency during mergers and acquisitions (M&A) transactions to view such due diligence as simply another box to check before closing. It is not. What might appear to be a time-consuming, costly and burdensome process, will not be fully appreciated until businesses are faced with the consequences of not doing so. 

This overview highlights several important benefits of proper environmental due diligence, discusses risk allocation and mitigation strategies, and identifies emerging issues.

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EPA Issues New CERCLA Guidance on Liability Protections for Current/Potential Impacted Site Owners

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Cozen O’Connor
Amorie Hummel and Marcia Mulkey

September 10, 2019

If you’re back to work navigating the complexities of cleaning up a brownfields site, you’re in luck. The United States Environmental Protection Agency (EPA) issued a 31-page update to “Enforcement Discretion Guidance” for enforcement personnel as it relates to liability protections under the 2002 Brownfields Amendments to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) this summer. While styled as a memorandum to agency enforcers, this guidance and its predecessor documents are also offered by EPA as “general information to landowners, developers, lenders, investors, or other third-party stakeholders who may wish to become involved with impacted properties.” The guidance is available here.

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Could Your Property Be Contaminated? And Do You Want to Know?

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Davis Wright Tremaine LLP
Lynn T. Manolopoulos

September 1, 2019

Avoiding Information Gathering About Your Property’s Potential Environmental Contamination May Not Do Your Business Any Favors

Do you own a piece of property that may be contaminated? We often hear clients say they do not want to know the answer to that question because they will be forced to do something about it. We disagree with that approach because you can’t make a good business decision about your property unless you have all the facts.

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The 2015 WOTUS Rule Is Repealed

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Breazeale Sachse & Wilson LLP
John B. King

September 13, 2019

The EPA and the Corps of Engineers have taken the first of two steps to repeal and replace the definition of ‘waters of the United States’ promulgated by the Obama Administration in 2015 (the 2015 Rule). The definition establishes the jurisdictional reach of the EPA and Corps under the Clean Water Act to regulate navigable waterways, tributaries, and their adjacent wetlands. The 2015 Rule had been widely criticized as being overly expansive because more waterways, tributaries, and wetlands were considered to be subject to jurisdiction.

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DOJ Announces Another Nail in Supplemental Environmental Projects’ Coffin

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Vinson & Elkins LLP
Ronald J. Tenpas, Carrick Brooke-Davidson and Conrad Bolston

September 3, 2019

The Department of Justice (“DOJ”) will no longer use Supplemental Environmental Projects (“SEPs”) in settlements with states and municipalities as a result of a policy change announced August 21, 2019.1 The change follows a series of steps taken since 2017 curtailing SEPs. It may foreshadow future action to formally curtail SEPs in settlements with private sector parties, as the memo notes that the Department is actively reconsidering current guidance that continues to allow SEPs in settlements with private parties.2 Even without a formal change to private party settlements, companies should expect increased difficulty in incorporating SEPs in negotiated settlements and, if engaged currently in negotiations, should consider accelerating those negotiations if inclusion of a SEP is a critical priority.

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