In a very interesting – and extremely rare – case, Emhart Industries has successfully defended itself against a unilateral administrative order issued by EPA under CERCLA, on the ground that key decisions made by EPA were arbitrary and capricious. The decision, concerning the Centredale Manor Restoration Project Superfund Site, is worth a read for CERCLA practitioners, even though it weighs in at 108 pages.… More
Category Archives: CERCLA
Earlier this week, Scott Pruitt released the results of the Superfund Task Force he established in May. Though skeptical, I was pleased at the creation of the task force and goals he established for it. With the release of the report, my skepticism has returned.
First, the report and Pruitt’s memo about it repeat the claptrap about restoring “the Superfund program to its rightful place at the center of the agency’s core mission.” Since he keeps repeating that statement,… More
Last week, I offered less than fulsome praise of EPA Administrator Pruitt’s announcement that he was taking control of remedial decisions for big Superfund sites. Now, he’s followed up with a memorandum announcing establishment of a task force to look at ways to reform Superfund implementation. While he’s still plainly wrong in putting Superfund “at the center of the agency’s core mission,” I have to confess that I think he otherwise has pretty much hit a home run with the latest memorandum.… More
Last week, EPA Administrator Pruitt issued a memorandum requiring that all Superfund remedies estimated to cost at least $50 million be approved by the Administrator. I’m not optimistic that this will cure, or even ameliorate, what ails CERCLA.
First, the memorandum gets off on precisely the wrong foot. Administrator Pruitt states that:
The Superfund program is a vital function of the U.S.… More
Does Chevron Ever Permit EPA to Rewrite a Statute? EPA’s Release Reporting Exemptions Are Struck Down
On Tuesday, the Court of Appeals for the District of Columbia vacated EPA’s final rule governing reporting of air releases from animal feeding operations. The Court found that EPA had no statutory authority to exempt AFOs from the reporting regulations.
The decision is also important because it is another in a recent line of cases regarding the extent of agency authority to interpret statutes. The issue was whether EPA had authority to exempt smaller AFOs from reporting requirements,… More
- It’s still going to be difficult to amend the key statutes, unless the GOP goes nuclear with the filibuster rules. I don’t see Clean Air Act amendments happening. Significant amendments might be possible to the Endangered Species Act and Superfund.…
I will confess that I do enjoy being correct. In 2014, the 9th Circuit Court of Appeals refused to defer to a state agency determination of the procedural and substantive fairness of a CERCLA consent decree. Various parties and commentators promptly began, if I may say so, to run around like chickens with their heads cut off. However, I remained calm. I stated then:
I’m assuming that,… More
Unlike CERCLA, the Massachusetts Superfund law, Chapter 21E, does include oil within its ambit. However, oil is not treated exactly the same as hazardous materials. One difference is that, in 2007, MassDEP revised the Massachusetts Contingency Plan to provide that, in certain circumstances, where “Contamination is limited to oil,” the exposure point concentration is measured at the Public Water Supply well, rather than in each of the monitoring wells, as is otherwise the case.… More
Complaints Are Not Totally Meaningless: A CERCLA Plaintiff Must Allege Disposal Against a Former Owner
I know it may surprise some litigators, but occasionally the allegations in a complaint do matter. In Garrett Day v. International Paper, the Court dismissed CERCLA claims brought by the current owner of a former paper mill located in Dayton, Ohio, against alleged former owners. The opinion covers a lot of issues, but the most important is the distinction between “release” and “disposal” under CERCLA. … More
I know that pointing out CERCLA’s stupidity has something of a dog bites man quality, but sometimes Superfund’s stupidity bears repeating. Today’s exhibit? New York v. Next Millenium Realty, in which Judge Feuerstein held – rightly, I am compelled to note – that New York’s natural resources damage claim was timely, because the site at issue had been added to the National Priorities List less than three years before the suit was filed.… More
Last week, we wrote about an audit that MassDEP is conducting of previously closed sites to look for high concentrations of TCE in soils and groundwater. The intent of the audit is to address potential vapor intrusion. The EPA has been paying attention to VI as well, and last Wednesday proposed to add vapor intrusion as a factor to be considered when evaluating the hazards posted by a contaminated site.… More
Determining when a person has “arranged” for the disposal of a hazardous substance has long been difficult. The Supreme Court brought some clarity to the issue in Burlington Northern, when it said that:
While it is true that in some instances an entity’s knowledge that its product will be leaked, spilled, dumped, or otherwise discarded may provide evidence of the entity’s intent to dispose of its hazardous wastes,… More
According to the Daily Environment Report (subscription required), EPA is going to change the name of the Office of Solid Waste and Emergency Response to the Office of Land and Emergency Management. What a grand name; surely it is an improvement.
I don’t think that this quite rises to the level of rearranging deck chairs on the Titanic (though I certainly have clients who would not object if OSWER sank without a trace),… More
Far too frequently, we are reminded just how hard judges must work to save CERCLA from itself. The decision last week in California River Watch v. Fluor Corporation is the most recent compelling example.
Fluor Corporation has been performing response actions at a site, including operating a soil vapor extraction system, since no later than 1997. Fluor’s remedial action plan was not approved until 2011 and a modified RAP was approved in 2014.… More
While The Outcome In the Lower Fox River Case Continues to Change, The Legal Standard For Apportionment Is The Same
In 1832, Abraham Lincoln said that ” it is better to be only sometimes right, than at all times wrong, so soon as I discover my opinions to be erroneous, I shall be ready to renounce them.” Judge Greisbach of Eastern District of Wisconsin apparently lives by this credo and once again has reversed himself in the Fox River PCB Superfund litigation. The history of Judge Greisbach’s readiness to renounce his opinions is catalogued in a string of my blog posts. … More
A group of PRPs received an oversight cost bill pursuant to a CERCLA consent decree. (The following details are intentionally vague to protect both the innocent and the guilty.) The bill was for several hundred thousand dollars. During the year covered by the bill, the PRPs spent no money cleaning up the area of the site covered by the invoice. They spent little or no money monitoring the area of the site covered by the invoice. … More
Sometimes cases seem to be deciding issues that are so obvious it’s hard to figure out why they get any serious attention from the courts. One such case is ASARCO, LLC v. Celanese Chemical Company recently decided by the Ninth Circuit. That decision affirmed the lower court’s unsurprising ruling that, when a private party agrees to perform response actions or pay response costs in a private party settlement under CERCLA,… More
Although it has taken a surprisingly long time, the holding in Burlington Northern which greatly lowered the standard for apportionment in Superfund cases is finally being embraced by lower courts. Last fall I blogged about a Seventh Circuit decision which rejected the trial court’s conclusion in the long-running Lower Fox River Litigation (US v. NCR Corp.) that a portion of the liability was not divisible. … More
Are Concurrent CERCLA Claims For Section 107(a) Cost Recovery and Section 113(f) Contribution Permissible?
Given the uncertainties after Cooper Industries v. Aviall about what cause of action a PRP has for recovering response costs under CERCLA, many parties take the prudent course of pleading claims under both for cost recovery and for contribution. A federal court in South Carolina in PCS Nitrogen, Inc. v. Ross Develop Corporation recently held that when a PRP can satisfy the pleading requirements of both a cost recovery claim and a contribution claim it is limited to only a contribution claim.… More
Late last month EPA issued draft guidance on adjusting post-closure periods under RCRA. It’s not good news.
Although the Guidance is technically neutral concerning shortening or lengthening post-closure periods, let’s not kid ourselves; this is all about extending post-closure care. For how long? How does forever sound?
Why do I think that this is all about extensions? First, if anyone can give me any examples where EPA has ever decreased this type of monitoring/oversight period,… More
Allocation of liability under CERCLA can get messy. One particularly complex issue arises in a private cost recovery action where some but not all the PRPs have settled with the private party. In contrast to a government cost recovery action, where CERCLA Section 113(f)(2) expressly provides that the response costs sought to be recovered by the government are reduced dollar-for-dollar by any settlement proceeds, CERCLA is silent with respect to the treatment of settlements in private party CERCLA claims.… More
In Consolidated Coal Company v. Georgia Power Company,the Fourth Circuit recently applied the same four part test used by trial court(and blogged about here) to hold that the sale of a used product containing PCBs would not give rise to arranger liabiity under Section 107(a)(3) of CERCLA. The appeals court reaffirmed the basic proposition that selling a used product that contains hazarous substances which eventually will be disposed is not sufficient to establish arranger liability:
Anytime an entity sells a product that contains a hazardous substance,… More
Over a decade after the Supreme Court’s decision in Cooper Industries v. Aviall, the divide between CERCLA Section 107 cost recovery claims and Section 113 contribution claims remains unsettled. PRPs incurring response costs at Superfund sites would almost always prefer to seek reimbursement of those costs as a Section 107 claim given its more favorable statute of limitations and joint and several liability standard. However, the post-Aviall case law offers little clarity as to the precise dividing line between Section 107 and 113 claims.… More
The decision earlier this month in Cyprus Amax Minerals v. TCI Pacific Communications is a useful reminder that corporate form exists for a reason and that parent corporations who ignore corporate niceties do so at their peril. In the Bestfoods decision, the Supreme Court made clear that CERCLA does not displace state corporate law and that a parent corporation will only be held indirectly liable for the acts of its subsidiaries when the corporate veil can be pierced under applicable state law.… More
As every litigator knows, evidence almost always tells a story that is untidy and riddled with loose ends. This was illustrated by a recent innocent landowner case in California — Coppola v. Smith. There, a company had purchased land in 1995 without knowledge that it had been contaminated with perchloroethylene (PCE) from a dry cleaning operation in the 1950s and 1960s. When the company was sued under contribution by a nearby dry cleaner for contributing PCE to to regional groundwater contamination, … More
Parties in CERCLA cases continue to deal with the consequences of the Supreme Court decisions in Aviall and Atlantic Research which essentially created two classes of PRPs: (1) PRPs who entered into CERCLA settlements with the federal or state government and were limited to Section 113(f) CERCLA contribution claims with three year statute of limitations and (2) PRPs who were permitted to pursue cost recovery claims under Section 107 of CERCLA with joint and several liability and a six year statute of limitations.… More
So the new Congress will be controlled by the GOP. The House and Senate will consider various bills to rein in EPA authority. Here’s one relatively modest suggestion for congressional consideration: amend CERCLA to limit EPA’s authority to recover oversight costs.
How many of us in the private sector have been in meetings with EPA where EPA had more technical people in attendance than the PRPs who were performing the remedy? … More
It is generally the rule that a lessee who does not operate the property it rents will not be liable under CERCLA except in the unusual circumstance where the lessee qualifies as an “owner” of the property. Typically, this means that a lessee who sublets the rented property will not be liable under CERCLA. That was the holding in a recent federal case in New York, Next Millennium Realty,… More
In Burlington Northern in 2008, the US Supreme Court ruled that Superfund liability could be apportioned whenever there was a reasonable basis for showing that the harm was divisible, such as by considering the length of time a PRP had been operating a site, the volume of waste contributed, or the percentage of the site utilized by that PRP. Notwithstanding that ruling, many courts since 2008 have continued to shy away from apportionment,… More
In an important decision yesterday, Judge Douglas Woodlock of the District of Massachusetts confirmed that CERCLA preempts local cleanup bylaws. The case involved one aspect of the cleanup of the W.R. Grace Superfund Site in Acton, Massachusetts. In 2005, EPA issued a Record of Decision requiring operation of a groundwater pump and treat system in what is known as the Northeast Area of the Site. However, EPA recognized that the contamination in the area was limited and stated in the ROD that the treatment system might be turned off in three years if certain criteria were met.… More
Before a Superfund settlement becomes enforceable, it must be reviewed by a federal court to confirm that it is fair, reasonable, and consistent with CERCLA’s objectives. This judicial review is at the heart of CERCLA’s settlement process. Since Superfund settlements provide broad protection to settling parties, judicial approval provides the necessary and exclusive procedural mechanism to vouchsafe that a proposed settlement is in the interest of the public as well as all other parties.… More
How Much Deference Do States Get in Entering CERCLA Consent Decrees? Probably A Lot, But Perhaps Not As Much as You Thought
In Cannons Engineering, the First Circuit Court of Appeals famously stated that, when CERCLA consent decrees arrive at the courts of appeal for review, they do so “encased in a double layer of swaddling,” because both the EPA decision to enter into the decree and the district court review of the EPA decision are entitled to significant deference. Last week, in Arizona v.… More
To the extent there was any remaining uncertainty, the Sixth Circuit has now made crystalline that a party settling some or all of its liability under CERCLA with the United States or a state has a contribution claim under Section 113 and not a cost recovery action under Section 107. Additionally, that contribution claim must be brought within three years of the date of any judgment entering the settlement or of any administrative order memorializing the settlement.… More
In contrast to the early days of Superfund when no argument for extending CERCLA liability was too far-fetched, the Second Circuit recently rejected one of the all-time “Hail Mary” passes for CERCLA contribution. The case, ASARCO LLP v. Goodwin, involved a 2009 settlement by ASARCO of Superfund liability involving several contaminated mines it owned in Everett, Washington. After settling, ASARCO asserted contribution claims against residuary trusts established in 1937 by the will of John D.… More
Even Superfund lawyers are likely to find the Supreme Court’s decision yesterday in CTS Corporation v. Waldburger to be of limited interest. Unable to reach an agreement about a federal “toxic tort” cause of action, Congress in the 1986 amendments to CERCLA settled on a limited provision that federalized the equitable tolling of statutes of limitation applicable to state toxic tort claims so that toxic tort claims would not accrue until a plaintiff either knew or should have known of his claim. … More
It was no surprise that the Second Circuit in In re September 11 Litigation recently affirmed the lower court’s ruling that contamination caused by the 9/11 attacks was within CERCLA’s “Act of War” defense. Although CERCLA is often said to impose strict liability regardless of fault, the Second Circuit’s decision indicates that CERCLA’s liability scheme was not intended to reach contamination that was caused entirely by the hostile acts of others:
The attacks wrested from the defendants all control over the planes and the buildings, … More
Most people would assume that, when the United States takes action directly impacting an individual, constitutional due process would ensure that individual has an opportunity to test the government’s action in court. That assumption, however, has been sorely tested in the past few decades as the government in more and more contexts is asserting that Congress has created “dark pathways” around due process. The most obvious instance of such dark pathways are the secret FISC courts created by the Foreign Intelligence Surveillance Act,… More
Although one might not ordinarily think to associate child pornography and pollution, the two were linked at an oral argument yesterday before the United States Supreme Court. Specifically, in a child pornography case, the defendant was found guilty of viewing a child pornography video obtained from the Internet. Pursuant to federal statute, the defendant was ordered to make “restitution” in the amount of $3.4 million to the juvenile depicted in the video.… More
The specter of environmental harm used to frighten courts and spawned a generation of decisions extending Superfund liability to virtually any party with a nexus to a site that was contaminated. One case that signaled just how willing courts were to impose a broad view of environmental liability was the 1988 decision by the Fifth Circuit in Tanglewood East Homeowners v. Charles-Thomas, Inc.. In that case,… More
Although courts are sometimes reluctant to enforce them, there really are hard stops in CERCLA, particularly the three year statute of limitations for recovery of costs incurred in a removal action. In Commonwealth of Pennsylvania Department of Environmental Protection v. Beazer East, Inc., the Third Circuit recently affirmed the dismissal of a CERCLA cost recovery action by the State of Pennsylvania on the basis of the three year limitations period for removal actions. … More
For those of you who were skiing or snorkeling (snorkeling in my case) and missed it, on December 30, EPA announced a direct final rule incorporating the new ASTM 1527-13 standard for site assessments into its all appropriate inquiries rule. Following ASTM’s release of the new standard, EPA’s action was expected, but remains important.
The biggest issue here is what EPA will do regarding the prior standard,… More
Some decisions are valuable not because they make new law but because they reaffirm well known principles of law. City of Banning v. Dureau is one such decision. There, a federal district court in California ruled that an owner of real property was strictly liable under CERCLA for the release of hazardous substances on her property and could not escape CERCLA liability by arguing that she was ignorant of the conditions giving rise to the release. … More
EPA’s Groundwater Remedy Completion Strategy: Making Cleanups More Efficient Or Just Increasing PRP Costs?
Last week, EPA released a draft Groundwater Remedy Completion Strategy. The strategy is intended to provide:
a recommended step-wise plan and decision making process for evaluating remedy operation, progress and attainment of [remedial action objectives] using an updated conceptual site model, performance metrics and data derived from site-specific remedy evaluations.
I like to think that I am skeptical, not cynical. Having worked on this stuff for 25 years,… More
In State of New York v. Next Millenium Realty, decided earlier this week, the 2nd Circuit Court of Appeals confirmed the wisdom of Gilbert and Sullivan. It is very difficult to blow the statute of limitations in CERCLA cases.
The question before the court was whether New York could recover from PRPs the cost of a granulated activated carbon (GAC) system and an air stripper tower,… More
Late last year I blogged on the dubious decision by the Seventh Circuit in Bernstein v. Blankert which held that a settling CERCLA party did not resolve its liability to the government until it had performed all of its obligations under the Consent Decree. While that decision enabled the settling party to get around a statute of limitations problem in bringing a claim against the real polluting party, … More
As Superfund lawyers know, the Supreme Court decision in Burlington Northern required proof of an intent to dispose hazardous substances as a prerequisite to imposition of arranger liability. While lower courts have often blissfully ignored the holdings in Supreme Court decisions under CERCLA, arranger liability seems to be one area in which the lower courts have taken the Supreme Court decision to heart.
In any event,… More
What To Do When You Are Issued A CERCLA Injunction To Perform A $1.5 Billion Cleanup — Lower Fox River Superfund Update
In a 78 page decision in the Lower Fox River Superfund case issued last month, the federal court issued an injunction against NCR Corp. and three other PRPs requiring them to perform a $1.5 billion remedy. No company ever wants to receive such an injunction and NCR sought to soften the impact of that injunction by proposing that it would share the costs of performing the remedy on an interim per capita basis with the three other PRPs. … More
Just as tortfeasors take their victims as they find them, s0 PRPs take their hazardous waste sites as they find them. This rule has been around since the beginning of CERCLA and means that a party which arranges for the disposal of its waste at one location can be generally be held responsible for whatever response costs that waste generates, including environmental cleanup costs at a second location if that waste is transshipped without the knowledge of the PRP.… More
A few months ago, I blogged on the decision in Duke Energy Progress Inc. v. Alcan Aluminum Corporation where a court held that a company would not be held liable for selling used transformers to a recycling facility for refurbishing and eventual resale to a new user. At the center of that holding was the notion that the transformers were not leaking PCB oils when delivered to the recycling center and could be refurbished in the exercise of due care without causing a release of PCBs.… More
In a post last year, I discussed what I I thought was the dubious dismissal of a CERCLA cost recovery action in Stratford Holding, LLC v. Fog Cap Retail Investors LLC. That case involved a holding that the costs of investigating the presence of solvents in the groundwater above regulatory standards were not “necessary” response costs because the the state had declined to list the site on its Hazardous Sites Inventory. … More
The Fourth Circuit handed down a primer on CERCLA liability last week in PCS Nitrogen Inc. v. Ashley II of Charleston. It should be required reading for Superfund lawyers. The facts in the case are worthy of a law school law school exam question on CERCLA– contamination arising from manufacturing of fertilizer beginning in the 19th century with the original corporate operator long since dissolved giving rise to new generations of corporate owners and operators —… More
Sometimes you read a decision and it’s hard to understand how there really were two plausible sides to the dispute. Arrowood Indemnity Company v The Lubrizol Corporation is one such a decision. There, a policyholder sold back its liability coverage for claims “arising out of” certain named environmental sites. When the policyholder subsequently received a PRP notice letter for a site that included a property that had allegedly been contaminated by waste migrating from one of the named environmental sites,… More
For the first time in CERCLA’s history, a court has concluded that a Superfund claim was barred by the “act of war” defense. In that case, In Re September 11 Litigation, the judge ruled that a property owner a block from Ground Zero could not recover the costs of cleaning up dust on his building from the collapse of the World Trade Center towers because the dust resulted from an act of war. … More
The Intersection of Subrogation and Environmental Law — The Ninth Circuit’s Tyranny of Logic over Common Sense
In a decision that exalts casuistry over common sense, the Ninth Circuit recently held that an insurer who reimbursed $2.4 million in CERCLA response costs to its policyholder had no subrogation rights against the potentially responsible parties that actually caused the contamination in the first place. That holding turns upside down the most basic principles of insurance law.
Chubb Custom Insurance Company v. Space Systems/Loral involved an assisted-living facility which was built on a former manufacturing facility that had been operated and allegedly contaminated with VOCs by Ford. … More
Exactly a year ago, I posted a blog that argued that the decisions on Superfund liability for the sale of usable product could be distilled down to an “unstated rule” — a party will be held liable as having intended to arrange for the disposal of a hazardous substance if it sells a waste that cannot be used or won’t be used as delivered without first causing the release of a hazardous substance. … More
In some jurisdictions, an environmental claim under a liability policy with a “sudden and accidental” pollution exclusion has the same prospect of success as a due process claim under the strict scrutiny standard — strict in theory, fatal in practice. In Massachusetts, however, sudden and accidental pollution exclusions have sometimes been less fatal, as evidenced by the recent decision in Narragansett Electric Company v. American Home Assurance Company. … More
Reverse Coverage Suits: What Happens When Policyholders Agree to Defend and Indemnify Their Insurers
Increasingly, when settling coverage disputes, insurers require policyholders to agree to defend and indemnify the insurer against any additional claims asserted against the insurer. This produces the curious result that the policyholder and insurer functionally switch places. For example, Hartford Fire Insurance Company recently sued its policyholder, Lanxess Sybron Chemicals Company. Lanxess had settled a coverage dispute with Hartford concerning the Kearny Superfund Site in New Jersey. As part of that settlement,… More
The chaos unleashed by Aviall continues in a recent decision by the Seventh Circuit. In Bernstein v. Blankert, the Seventh Circuit revisited the issue whether a party having entered into an Administrative Order by Consent had a claim against other PRPs for cost recovery under Section 107(a) or for contribution under Section 113(f)(1). Offering a novel and entirely misguided conclusion, the court found that whether a party has a claim for cost recovery or for contribution hinges on whether that party had completed all of its obligations under the AOC. … More
In Burlington Northern, the Supreme Court made clear that, in order to impose liability on a defendant as an “arranger” under Superfund for the sale of a product, the plaintiff must demonstrate that the defendant
must have entered into the sale of [the product] with the intention that at least a portion of the product be disposed during the transfer process.
Although courts do not seem thus far to have taken to heart the Supreme Court’s allocation discussion in Burlington Northern,… More
A story in Tuesday’s BNA Daily Environment Report notes that several representatives of industry interests are asking EPA to hold off on issuing its much-anticipated vapor intrusion guidance until it can be subject to public comment. Apparently, the current draft was sent to regional offices – but not distributed to the public – for review. Someone at Inside EPA leaked it to Fox Rothschild and asked for comment. … More
Is There A De Minimis Defense To Liability in Superfund? The Supreme Court Indicated There Was; One District Court Says No.
Burlington Northern squarely decided that where environmental harm is divisible, an individual PRP can obtain apportionment of its liability and be assigned a specific percentage share; in such instances, there will be no joint and several liability. The possibility follows from Burlington Northern that a PRP which can establish divisibility of harm might be able to show that its percentage share of liability is so small that it effectively has a complete defense to liability.… More
Remedy decisions are almost always won or lost at the agency level. Once the ROD issues, a PRP’s chance of having the selected remedy overturned in court is slim to none – a point that was driven home in a recent decision in the Lower Fox River case.
There, the government had engaged in a decade-long remedy selection process which began as a $325 million PCB dredging project. … More
Over a decade after it was issued, Aviall continues to cause difficulties for private settling parties in CERCLA. In Lewis v. Russell, a federal district court recently considered whether a PRP which agreed to a cash payment from another PRP has to reduce his claim against other PRPs by the actual amount of the cash payment or by the proportionate share of the settling party. … More
Who Knew? The National Research Council Discovers That Many Groundwater Cleanups Will Take More Than 100 Years
Daily Environment Report today noted that the National Research Council has produced a study, Alternatives for Managing the Nation’s Complex Contaminated Groundwater Sites, which assesses the scope of the groundwater contamination problem and our ability to address it. One significant takeaway from the report is that
Significant limitations with currently available remedial technologies persist that make achievement of MCLs throughout the aquifer unlikely at most complex groundwater sites in a time frame of 50-100 years.… More
What happens when Superfund runs headlong into Mother Nature? Hurricane Sandy provides a vivid answer. As the New York Times reports today, Hurricane Sandy had a significant impact on the Gowanus Canal Superfund Site in Brooklyn, NY. The Canal was completed in 1869 and for over a century was the recipient of industrial discharges from mills, tanneries, and chemical plants resulting in what EPA describes as “one of the nation’s most heavily contaminated water bodies.” Contaminants include PCBs,… More
EPA recently released two guidance documents relevant to Superfund practitioners. One establishes revised procedures regarding how EPA will manage negotiations with PRPs. The second updates EPA’s guidance on how it will handle Alternative Sites. To me, both have the flavor of deck chair management on the Titanic.
The RD/RA negotiation guidance has to be seen to be believed. It’s a document that seems reasonable on its face,… More
Indemnification Agreements Under CERCLA Do Not Affect Liability to Entities That Are Not Parties to the Agreement
Section 107(e) of CERCLA provides that
No indemnification, hold harmless, or similar agreement or conveyance shall be effective to transfer from the owner or operator of any vessel or facility or from any person who may be liable for a release or threat of release under this section, to any other person the liability imposed under this section. Nothing in this subsection shall bar any agreement to insure,… More
In a poignant moment in Godfather III, Al Pacino’s character says: “Just when I thought I was out… they pull me back in”. EPA’s recent eye-popping announcement of a $366 million encore settlement by AVX with respect to the New Bedford Harbor Superfund Site re-enacts that moment, graphically illustrating the toxic combination of EPA’s sorry history of escalating remedy costs for water-based Superfund sites and Consent Decrees that contain cost-reopening provisions.… More
Although some of the proposed tax plans and budgets being discussed in this election year suggest that the same dollar can be counted and spent multiple times, a growing number of courts have held that CERCLA response costs can only be allocated once. The most recent holding comes in the Lower Fox River litigation where Judge Greisbach ruled that CERCLA pre-empts most ancillary state law claims – whether styled as state law contribution claims or common law claims for negligence and strict liability: “If the funds were expended pursuant to CERCLA,… More
Like a comet which drags a long trail in its wake, large CERCLA cases in federal court often are accompanied by related insurance coverage cases in state court. That is true with the Lower Fox River Superfund Site in Wisconsin. While a firestorm of litigation has raged for many years in federal court relating to the billion dollar liability for PCB contamination in the Lower Fox River, the key PRP in that litigation – NCR —… More
In an environmental dispute between innocents involving a Church and a downgradient property owner, a federal court recently found the Church, although without original sin, was less innocent and should bear all the costs of the cleanup, even the costs of cleaning up an independent source of contamination on the downgradient property. In Alprof Realty LLC v. Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints,… More
Site owners who conduct environmental investigations of potential releases of hazardous substances in the expectation that they will be able to recover their costs from the party whose operations gave rise to that threatened release may be surprised by the outcome in a recent federal district case in Georgia, Stratford Holding, LLC v. Fog Cap Retail Investors LLC. There, a site owner brought CERCLA and state law claims against a tenant and subtenant for dry cleaning operations after the owner’s sampling showed over 2 ppm of tetrachloroethylene (PCE),… More
An article in the New York Times earlier this week reported on EPA’s attempts under the Superfund program to address contamination in water bodies, such as rivers, lakes and harbors. Although the article acknowledges that these water body sites are technically challenging, it does not remotely capture the tortured regulatory history of these sites or the dubious remedial approach that EPA is now pursuing. It is not an exaggeration to say that some of the most notorious Superfund failures involve water body sites.… More
PRPs hoping that the Supreme Court in Burlington Northern had established that volume could always be used as a basis for apportioning CERCLA liability will be disappointed by a recent Seventh Circuit opinion. Affirming the trial court’s apportionment decision in the Lower Fox River case on which I blogged earlier, the Seventh Circuit distinguished Burlington Northern and followed the Restatement test that apportionment is not available whenever each tortfeasor’s contribution is independently capable of causing the harm. … More
The First Circuit recently confirmed the traditional rule that it doesn’t take much to trigger an insurer’s duty to defend a policyholder against an environmental claim. In Travelers Casualty and Surety Company v. Providence Washington Insurance Company, the First Circuit overturned the trial court’s conclusion that there could be no coverage for contamination under liability policies issued after a property owner had ceased the activities giving rise to that contamination.… More
Is Knowledge an Element of CERCLA Liaiblity: The Lower Fox River Court Said So, But Did The Court Really Mean It?
The course of the Lower Fox River Superfund litigation has been a continual set of surprises, and its denouement was true to that pattern. In his post-trial decision last week, Judge Griesbach wrote the sentence that most CERCLA defendants have been waiting 30 years to hear: “It … seems doubtful that a defendant can ever be found to be an arranger if he did not know the substance in question is hazardous.” For a statute in which liability has always been held to be strict and without fault,… More
The Lower Fox River Superfund site continues to pump out decisions on key CERCLA issues. Most recently, the federal court in Wisconsin in US v. NCR Corp. took on the issue of divisibility of harm in granting a preliminary injunction requiring one of the PRPs, NCR, to complete the removal of 660,000 cubic yards of PCB-contaminated sediments from a portion of the Lower Fox River. In entering that injunction,… More
It’s always satisfying to find an open-minded judge who is willing to change his decision when he is shown to be wrong, but Judge Greisbach of the Eastern District of Wisconsin may be crossing the line from open-mindedness into a chronic inability to make up his mind. In the past 9 months, Judge Greisbach has issued three separate decisions in US v. NCR on the subject of whether a party,… More
Deciding statute of limitations issues in CERCLA cases is not always a straightforward matter as the recent 54 page opinion in American Premier Underwriters Inc. v. General Electric Company illustrates. There, a federal court in Ohio was faced with the unenviable task of trying to determine whether remedial actions and removal actions at four separate railroad sites located in four different states were barred by statutes of limitations under CERCLA and state law. … More
For once, speculation about oral argument proved solid. The Supreme Court’s unanimous ruling today in Sackett v. EPA means that EPA must allow judicial review of enforcement orders issued pursuant to its authority under the Clean Water Act. The question now is what the true scope of the decision will be. That question really has two parts.
The first is what will happen to CWA enforcement. On that score,… More
Over the first two decades of CERCLA, the rule gradually emerged that parties which settled their liability were restricted to contribution claims under Section 113(f)(1) and would be entitled to contribution protection under Section 113(f)(c)(2). Moreover, in order to ensure the effectiveness of that settlement scheme, courts routinely ruled that claims against settling parties were all barred by contribution protection regardless whether those claims had been asserted in the form of direct CERCLA cost recovery claims under Section 107 or as common law tort claims for negligence,… More
Arguments about liability for the sale of “usable wastes” are as old as Superfund. The fact patterns involving the sale of usable wastes can be varied; however, the cases seem to be governed by the following simple but never explicitly stated rule: a party will be held liable if it sells a waste that cannot be used or won’t be used as delivered without first causing the release of a hazardous substance.… More
According to a report in yesterday’s Greenwire, President Obama’s proposed budget would reduce Superfund spending by 6%, from $565 million to $532 million. I still don’t understand why Obama, particularly with Cass Sunstein still at OMB, hasn’t turned this problem into an opportunity. I know I’ve flogged this one before, but a significant part of the explanation for the size of the Superfund budget is related to CERCLA’s status as the last bastion of command and control regulation. Everyone who practices in this area could provide endless examples of the almost unbelievable extent of micromanaging indulged in by EPA and its consultants. Even where EPA is recovering oversight costs,… More
On Friday, EPA finally issued its long-awaited revised risk assessment for tetrachloroethylene, also known as perc or PCE. EPA also issued a fact sheet summarizing its current views about PCE and how the new risk assessment fits into the Clean Air Act, Safe Drinking Water Act, and CERCLA regulatory regimes.
Because PCE is present at so many Superfund Sites, and given the number of dry cleaners – including many in residential areas – still using PCE,… More
The PCB contamination in the Lower Fox River in Wisconsin continues to spawn novel Superfund decisions. The latest is US v. NCR, in which Judge Greisbach of the Eastern District of Wisconsin reversed his initial ruling, made less than six months ago, that the United States could not establish successor liability under CERCLA against Appleton Papers, which had bought assets from the alleged polluting party – NCR Corp – and assumed NCR’s liabilities.… More
As one Potentially Responsible Party in Wisconsin recently discovered, Superfund consent decrees are the gift that requires you to keep giving. In US v. Wauconda Sand & Gravel Co., a PRP which thought it was extinguishing its liability by signing a consent decree in 1994, received a demand from EPA a decade later to perform additional work. The PRP balked, claiming that it believed it had completed its obligations under the consent decree. … More
Watch What You Do With That Shovel (Or Heavy Equipment): Another Developer Faces Superfund Liability For Site Redevelopment
More than 20 years ago, in the Tanglewood East decision, the 5th Circuit Court of Appeals held that a developers could potentially be liable under CERCLA for conducting site development activities that moved contamination on the site, exacerbated conditions, and required additional cleanup. There have not been many reported cases on this issue since then, so the decision earlier this week in Saline River Properties v.… More
Environmental liability has always been a dish best served in as many slices as possible. Hence, CERCLA jurisprudence in its first two decades was characterized by a judicial willingness to entertain ever more creative theories to extend environmental liability to new classes of parties, such as a developer who unknowingly moved contaminated soil (Tanglewood East) to a toll manufacturer who merely directed the production of a useful product with knowledge that there would be hazardous waste by-products (Aceto).… More
As much as I’ve always found EPA’s use of unilateral administrative orders under Section 106 of CERCLA to be offensive, I still expected EPA’s authority to withstand challenge. As I noted previously, not every law that is unfair is unconstitutional. At least for now, the issue has probably been laid to rest. Yesterday, the Supreme Court denied GE’s petition for certiorari seeking to appeal the D.C.… More
The Proof Will Be in the Pudding: EPA Releases Its Preliminary Plan For Review of Existing Regulations
When President Obama issued Executive Order 13,563, on Improving Regulation and Regulatory Review, it was not obvious whether the Order was simply an attempt to protect the President’s right flank or whether the agencies would respond substantively. Yesterday, EPA released its Preliminary Plan for Periodic Retrospective Reviews of Existing Regulations. Initial review of the Plan suggests that EPA has taken the task seriously and has made some constructive suggestions. To me,… More
Vapor Intrusion and the National Priorities List: Why Should the Biggest Superfund Problem Not Be Regulated Under Superfund?
As I have previously mentioned, EPA is considering including criteria related to vapor intrusion (VI) in the hazard ranking system scoring used to determine which sites should be added to the National Priorities List. As I noted when this first became news, it’s pretty much an obvious step for EPA to take. These are precisely the types of sites on which EPA should be focusing. At a certain level,… More
Recently, I expressed concern that District Courts, which traditionally have never seen a CERCLA plaintiff they didn’t like, would ignore the Supreme Court’s Burlington Northern decision – at least until there is another Supreme Court decision affirming that Supremes really meant the two-part holding in Burlington Northern: (1) divisibility isn’t that hard and (2) parties aren’t liable as arrangers unless they actually intended to dispose of hazardous material. … More
In late 2009, Judge Griesbach ruled, in Appleton Papers v. George A. Whiting Paper, that parties who were significantly more “blameworthy” than others were not entitled to contribution from the less blameworthy parties. Last week, Judge Griesbach ruled on the cross-contribution motions from the defendants.
The defendants took a simple view. If the plaintiffs are not entitled to contribution from the defendants,… More
Vapor intrusion is the issue de jour at federal and state Superfund sites. On the federal side, EPA announced in January that it was considering adding vapor intrusion criteria to its calculation of hazard ranking scores. Frankly, as a concept, it’s hard to dispute. In fact, aside from when actual public water supplies are contaminated, indoor air is probably about the only risk associated with Superfund sites that we should care about. Every analysis EPA has ever done has shown that risks associated with Superfund sites are otherwise overestimated and it is not a cost-effective place to be putting environmental protection dollars. The question of course is how to go about regulating indoor air.… More
A Man’s Home (Or Mall Or Other Business) May Be His Castle — But He Still Has to Provide Access When Contamination Is At Issue
Two recent decision illustrate that PRPs do hold some cards in hazardous waste litigation, particularly if they are willing to be aggressive in investigating the contamination. Both cases demonstrate that “victims” or bystanders can face serious consequences if they do not cooperate with the investigation.
It may be an apocryphal story, but my understanding as to why so many small municipal landfills in New Hampshire ended up on the NPL is that some bright light in the Granite State thought that Superfund was a public works program and that the fund would pay for the landfill closures. The result? Small towns became PRPs, responsible for Superfund response costs which, in some cases, approximated their annual municipal budget.… More
How Much Circumstantial Evidence Is Enough To Establish Liability? More Than Just Proximity and a Bad Name
Sometimes, good lawyering does matter. When DVL found PCBs on its property in Fort Edward, New York, and when it looked up and realized that GE had operated a manufacturing facility which utilized PCBs “almost adjacent” to DVL’s property, DVL and its attorneys may have thought that they had a slam dunk case on liability. Not so fast. Last week, in DVL v. General Electric, Judge Lawrence Kahn awarded GE summary judgment on liability,… More
As the holiday approaches, I am particularly thankful that I am not counsel to the Washington State DOT in United States v. Washington State DOT, a case that continues to make me want to take EPA, DOJ, and United States District Judge Robert Bryan by the neck and ask them what the heck are they thinking.
As Superfund practitioners know, federal NPL sites are generally settled on the basis that the PRPs will first attain interim cleanup levels, though final cleanup levels are not determined until EPA is actually ready to issue its certification of completion of the remedy. Moreover, EPA insists that, should any ARARs change during the course of the cleanup, whatever standards are in effect at the time of site closure will be applied.… More
One of the first lessons I learned as a summer associate, more years ago than I care to remember, is that the probability of a successful estoppel claim against the government is approximately the same as the probability that there is a Santa Claus. After the recent decision from the District of New Jersey in FMC Corporation v. American Cyanamid, the probability of a successful estoppel claim may still be low,… More
My partner Robby Sanoff blogged last week about the “Illusion of Finality in CERCLA.” His post addressed City of Emeryville v. Sherwin-Williams, in which the 9th Circuit Court of Appeals held that a person who was not a party to a prior settlement could bring a contribution claim against such a settling party, at least where the new claim involved contamination at a downgradient property,… More
In City of Emeryville v. The Sherwin-Williams Company, the Ninth Circuit recently underscored that CERCLA settlements can be a risky business that don’t always produce finality, particularly when neither the United States nor a state is a party.
The Ninth Circuit decision grew out of a federal court action by the City of Emeryville involving contamination at a manufacturing facility that had been operated by Sherwin-Williams. Sherwin-Williams settled that suit and obtained what it thought was broad protection against contribution claims based on contamination “at,… More
There are only two permissible answers to this question:
- I don’t know.
I was reminded of this reality in reading the decision issued earlier this month in Solutia v. McWane, in which Chief Magistrate Judge Greene of the Northern District of Alabama held that a party which incurs response costs pursuant to a consent decree or administrative order may not bring an action for cost recovery under § 107 of CERCLA and is instead limited to a contribution action under § 113 of CERCLA.… More
Sometimes, the practice of environmental law just takes my breath away. A decision issued earlier last month in United States v. Washington DOT was about as stunning as it gets. Ruling on cross-motions for summary judgment, Judge Robert Bryan held that the Washington State Department of Transportation had “arranged” for the disposal of hazardous substances within the meaning of CERCLA by designing state highways with stormwater collection and drainage structures,… More
Last year, I analogized PRP efforts to have CERCLA’s unilateral administrative order provisions declared unconstitutional to Chevy Chase’s repeated announcements during the first year of Saturday Night Live that Francisco Franco was still dead. Eventually, that joke wore out. With yesterday’s decision by the D. C. Circuit Court of Appeals, in General Electric v. Jackson, upholding EPA’s UAO authority, these legal challenges may be similarly about to wear out.… More
Last week, EPA’s Office of Solid Waste and Emergency Response announced release of its Community Engagement Implementation Plan. Who could be against community engagement? It’s as American as apple pie. It’s environmental justice. It’s community input into decisions that affect the community. It’s transparency and open decision-making.
Call me a curmudgeon, but I’m against it. Study after study shows that, in terms of the actual risks posed by Superfund sites, we devote too many of our environmental protection dollars to Superfund sites,… More
When the Burlington Northern decision was first announced, I concluded that “never has the Supreme Court done so much by doing so little.” On May 5, Judge John Mendez, of he Eastern District of California, proved me at least half right. In United States v. Iron Mountain Mines, joint and several liability was imposed on the defendants in 2002. The 2002 decision stated that “given the nature of pollution at the site,… More
One of the outstanding questions following the Supreme Court decisions in Aviall and Atlantic Research was whether a party which had entered into a consent decree with the United States and incurred direct response costs as a result could bring an action for cost recovery under § 107 of CERCLA or whether such a settling party would instead have a contribution action under § 113. The problem facing practitioners and the courts following Atlantic Research was that the Supreme Court seemed to have backed itself into a corner. By focusing its analysis of § 113 so narrowly on the traditional common law understanding of contribution,… More
Last week, Judge William Griesbach, of the Federal District Court for the Eastern District of Wisconsin, issued an important Superfund contribution decision, which shows just how much equitable discretion judges have in resolving contribution claims. In Appleton Papers v. George Whiting Paper, Judge Griesbach ruled, on summary judgment, that one equitable factor, knowledge of the potential environmental harm caused by PCBs, trumped all others,… More
In an interesting decision issued a few weeks ago, a District Court in Georgia held that a property manager at a strip mall could not be held liable as an owner of a facility under CERCLA. However, the court held that the property manager could be liable as an operator of the facility. I don’t think that the decision is correct, but if it is the law, then property managers would be wise to consider carefully what responsibilities they are willing to assume and what sort of indemnification agreements may be required with the actual property owners.… More
Late last week, Elliott Gilberg, Acting Director of EPA’s Office of Site Remediation Enforcement (OSRE) issued an Interim Policy on Managing the Duration of Remedial Design/Remedial Action Negotiations. Members of the regulated community may not be surprised by the contents of the memo, but they certainly will not be pleased. In brief, the memorandum fundamentally makes two points:
EPA wants to shorten the duration of RD/RA negotiation
EPA is going to use the heavy hammer of unilateral administrative orders,… More
Justice Potter Stewart famously said, with respect to obscenity, that “I know it when I see it.” I fear that the test for what constitutes an imminent and substantial endangerment under RCRA is no clearer than Justice Stewart’s subjective test regarding obscenity.
For those of you who cannot get enough of Superfund, I spoke at a Boston Bar Association panel on this subject yesterday about the implications of the Supreme Court’s Burlington Northern decision. Thanks to EPA Region I and Joanna Jerison, head of the Region I Superfund Legal Office, for being willing to speak on so obviously sore a subject. And thanks to Craig Campbell for participating on the panel as well.… More
One more note on the Burlington Northern decision. A client of mine has already noted that one impact of the decision will be to result in more litigation over divisibility, which will be good for private lawyers (ouch!). She’s right, as my clients always are, but she shouldn’t be.
Litigation should only increase if EPA does not adjust its settlement demands. If EPA responds appropriately, and makes demands which reflect a fair resolution of a divisible liability,… More
Those of us who have practiced in the Superfund arena for some time know that the government, in those rare cases where it has been forced to litigate, has used the same oral argument in every case: “Good morning, your honor. My name is ______. I represent the government in this action and we win.” Today, the Supreme Court made clear that that the government now needs a new oral argument template.
As some of my clients know all too well, I’ve been spending a lot of time on some Superfund matters recently. Although I can’t remember a period when I didn’t have at least one moderately active Superfund case, significant immersion in complex remedial decision-making and negotiations provides an unwelcome reminder just how flawed CERCLA is. Almost 20 years after the acid rain provisions of the Clean Air Act ushered in wide-spread acceptance of the use of market mechanisms to achieve environmental protection goals and the state of Massachusetts successfully privatized its state Superfund program,… More
Life After Atlantic Research: The Second Circuit Court of Appeals Holds that Response Costs Incurred Pursuant to a Consent Decree Are Recoverable Under Section 107 Of CERCLA
For those following developments in Superfund cost recovery and contribution case law after the Atlantic Research decision, it seemed worth noting that the Second Circuit Court of Appeals recently held, in W.R. Grace & Co. – Conn. v. Zotos International, Inc., that a party who incurs response costs pursuant to a state consent order has a right to bring an action to recover those response costs under § 107 of CERCLA.… More
In Key Tronic Corp. v. United States, the Supreme Court held that costs which are “closely tied to the actual cleanup may constitute a necessary cost of response in and of itself….” Such costs include “work performed in identifying other PRPs.” According to the Supreme Court, “tracking down other responsible solvent polluters increases the probability that a cleanup will be effective and get paid.”
On the other hand,… More
Readers of a certain age will recall Chevy Chase’s Weekend Update segment during the first year of Saturday Night Live, when, for a number of shows, he would report that Francisco Franco was still dead. (And isn’t it great that there is actually a Wikipedia article on the subject of Franco still being dead!).
This segment was brought to mind by the report of this week’s decision out of the District Court for the District of Columbia,… More
“Expert Testimony” Evidence Proof
Private Contribution and Cost Recovery Claims Under CERCLA: The State of the Law after Atlantic Research
For those of you who haven’t been keeping up with the law on private cost recovery and contribution claims under CERCLA, following the decision in Atlantic Research, I recently participated in a panel discussion on the issue. A copy of my presentation can be found here.
The most contentious issue during the discussion was whether private parties who have settled with the government and performed direct cleanups –… More
In a recent decision, the 7th Circuit Court of Appeals confirmed that neither CERCLA nor RCRA provide convenient ways for the buyer of a building containing asbestos to finance the abatement of that asbestos. In Sycamore Industrial Park Associates v. Ericsson, the seller of the building replaced the old heating equipment shortly prior to sale, but left the old system, including piping, in place. The buyer sought to make the seller pay for the asbestos abatement on the ground that the seller has disposed of the old equipment by abandoning it in place when it installed the new system.… More
Two recent decisions from the Southern District of Texas make clear that, like pornography, the courts know arranger liability under CERCLA when they see it. Both cases involve defendants in private cost recovery actions arising out the Tex Tin Superfund Site in Texas City, Texas. The Tex Tin Settling Defendants Steering Committee (known by the mellifluous acronym TTSDSC) brought suit against Dow Chemical and Bayer USA, alleging that each had arranged for the disposal of hazardous materials at the Tex Tin Site.… More
As pretty much everyone knows, in order to improve its prospects for passage, the Senate added certain tax provisions to the financial bailout bill – also know as the Emergency Economic Stabilization Act of 2008, or H.R. 1424 – enacted earlier this month. One of the provisions included in the EESA was an extension of the brownfields tax incentive.
The brownfields tax incentive, originally enacted as part of the Taxpayer Relief Act of 1997,… More
As those of us who have practiced in the Superfund arena for some time know, in the early years of Superfund litigation, such litigation was, from the defendant’s perspective, brutish and short, if not nasty and mean. The DOJ attorney would, in essence, march into court, state “I am from the government; I win,” and the case would be over.
In recent years, that approach has not proven quite so uniformly successful.… More