May 01, 2016

In Brief

Theodore L. Garrett


United States v. Dico, Inc., 808 F.3d 342 (8th Cir. 2015).
A divided Eighth Circuit panel reversed a district court decision holding defendant Dico Inc. liable under Superfund when it sold buildings in Iowa on a site subject to a U.S. Environmental Protection Agency (EPA) cleanup order. The purchaser dismantled the building, and EPA later found polychlorinated biphenyls (PCBs) in soil and steel beams on the property. The district court granted the government’s motion for summary judgment that defendant was liable for cleanup costs by “arrang[ing] for disposal” of the PCBs. The court of appeals agreed with Dico’s argument that the buildings had some commercial value based on which a fact finder may find that Dico did not intend to dispose of PCBs by selling the buildings. “Overall, unlike cases finding liability at summary judgment, we do not believe the evidence of record demonstrates as a matter of law that Dico was merely trying to get rid of a hazardous substance,” the court’s opinion states. The court of appeals cited the Supreme Court decision in Burlington Northern, which calls for a fact-specific inquiry, particularly when the motives for a sale are not clear, and concluded that Dico’s intent should not have been decided on summary judgment. The court affirmed the award of penalties for violating an EPA order concerning the use of the buildings but vacated an award of punitive damages. The dissent viewed the facts as showing that Dico wanted the buildings and their PCB contamination gone and thus intended to dispose of the PCBs.

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