Environmental enforcement actions bear a potential for enormous risk. One statute imparts liability on persons for the conduct associated with solid and hazardous waste. The Resource Conservation and Recovery Act of 1976 (RCRA) provides that any person “who has contributed or who is contributing to” the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment” is liable. Multiple circuits and the legislative history have stated that RCRA provides for strict liability. Yet, in practice, courts are not so strict. In the attempt to define the “has contributed” or “is contributing” element, courts examine persons’ affirmative actions and/or control exercised with respect to the relevant waste, and as a result, fundamentally change the strict application of RCRA to a framework that considers intent.
RCRA also does not specify a standard of liability, and its legislative history is inconsistent. 42 U.S.C. § 6901, et. seq. Principles of strict statutory interpretation state that if a standard is not specified, one can assume strict liability applies. Under RCRA, a plaintiff has to establish three elements: (i) a site may present an imminent and substantial endangerment to the health or environment; (ii) the endangerment arises from handling, storage, treatment, transportation, or disposal of any solid or hazardous waste, and (iii) the defendant is contributing or has contributed to such handling, storage, treatment, transportation, or disposal. 42 U.S.C. § 6972(a)(1)(B). Considering only the first element, the evidentiary standard appears to be low. Plaintiffs do not have to establish that an endangerment actually exists, just that there is a present threat of endangerment. The third element—contribution—presents a more complex question.
RCRA was adopted in 1976, and the legislative history surrounding its two subsequent amendments is conflicting. The history accompanying the 1980 amendment alone contains at least two different interpretations of “contributing to.” In its “Report on Hazardous Waste Disposal,” a subcommittee of the U.S. House of Representatives Committee on Interstate and Foreign Commerce stated that “a company that generates hazardous waste would be someone ‘contributing to’ an endangerment under [RCRA], even where someone else deposited the waste in an improper disposal site similar to strict liability under common law.” H.R. Comm. Print No. IFC 31, 96th Cong., 1st Sess. 31 (1979) (the Eckhardt Report). But a U.S. Senate Report from the same period contradicted the House subcommittee’s report:
[A] company that generate[s] hazardous waste might be someone “contributing to” an endangerment under [RCRA] even where someone else deposited the waste in an improper disposal site (similar to strict liability under common law), where the generator had knowledge of the illicit disposal or failed to exercise due care in selecting or instructing the entity actually conducting the disposal.
S. Rep. No. 172, 96th Cong., 2d Sess. 5, reprinted in 1980 U.S. Code Cong. & Ad. News 5019, 4023 (emphasis added).
Four years later, RCRA was amended again, and the legislative history accompanying the 1984 amendment stated that “persons who have contributed in the past or are presently contributing to the endangerment” could certainly be held accountable under RCRA, even “regardless of fault or negligence.” H.R. Conf. Rep. No. 1133, 98th Cong., 2d. Sess. 119 (1984), reprinted in 1984 U.S. Code Cong. & Ad. News 5649, 5690. The 1984 amendment added statutory language providing that past off-site generators and transporters could be held liable under RCRA, but the legislative history went a step further, indicating that RCRA liability should be strict by its language “regardless of fault or negligence.” Courts define “contribute” to require an affirmative act or control. This definition conflicts with the principle of strict liability. However, by requiring an affirmative act or knowing control to establish “contribution,” a court must consider culpability because an affirmative act or control requires a subjective evaluation. Did a person knowingly hire a corrupt contractor to save costs on solid waste disposal? Or was the person responsible for hiring contractors knowingly negligent? Or perhaps they should be strictly liable for all contractors they hire to perform remediation work? To establish this conclusion, the trier of fact has to evaluate intent. A look at cases illustrates this point and a trend toward a narrower standard of liability.
Relying on the 1984 amendments and legislative history, the court in Northeastern Pharmaceutical agreed with the government’s argument that “the standard of liability under RCRA . . . is strict liability, not negligence,” with respect to past off-site generators and transporters. Although courts initially focused on whether RCRA required a standard of strict liability because of the legislative history; courts have since focused on identification of an affirmative act or control without even considering the application of strict liability. In determining who may be subject to that standard, the “critical issue is the meaning of the phrase ‘contributing to.’” United States v. Northeastern Pharmaceutical & Chemical Co., 810 F.2d 726, 738–741 (8th Cir. 1986).
Courts in several circuits also have held that “[i]ndividuals are liable under RCRA without regard to fault or negligence,” and as a result, “contributing to” should be construed liberally. See, e.g., Zands v. Nelson, 797 F. Supp. 805, 809 (S.D. Cal. 1992); see Cox v. City of Dallas, 256 F.3d 281, 295–296 (5th Cir. 2001) (citing United States v. Aceto Agricultural Chemicals Corp., 872 F.2d 1373, 1383 (8th Cir. 1989)). (“As to the fault standard under which such ‘contributions’ are held actionable, we note that the one circuit that has addressed this specific issue has held that the RCRA imposes strict liability, i.e. liability imposed without regard to the defendant’s negligence or intent to harm.”). In Aceto, a plaintiff sufficiently alleged “contribution” by the defendants even though a non-defendant conducted the disposal of the relevant waste. The source of the waste was the Aidex facility at which each defendant had outsourced formulation of their respective pesticide products. The defendants argued that despite maintaining ownership of their respective raw materials and resulting pesticide product, they exercised no control over the production process or how Aidex disposed of the waste. The court disagreed, finding that a liberal construction of “contributing to” did not require an explicit allegation of “control.” It was enough “to have a share in any act or effect,” and defendants’ contract with Aidex and retention of ownership of the pesticide materials throughout the process indicated they had the authority to control the way in which formulation and disposal of wastes occurred. (The court went so far as to say “contributing to” required less involvement than “to arrange,” the burden for recovery under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 [CERCLA].) Thus, the defendants’ connection to the waste satisfied the “contributing to” standard although it did not amount to an affirmative act.
While the holding that RCRA confers strict liability has not been directly overruled, recently courts have moved away from the strict liability standard in interpreting RCRA. Courts, instead, require a plaintiff to establish a nexus between the defendant and the waste, a somewhat subjective threshold. As one court said, the “contribute to” language requires “that there is no liability without a causal relationship between a defendant and an imminent and substantial endangerment.” Zands, 797 F. Supp. at 809. More specifically, courts require either an affirmative act or control, plus knowledge, to establish contribution, making RCRA liability a subjective, fact-specific inquiry that considers fault. This point is illustrated by two lines of cases: one requiring “active contribution” and another requiring an “intent to discard” to impose liability.
Courts widely hold that “contributing to” requires a defendant to “be actively involved in or have some degree of control over the waste disposal process.” E.g., Hinds Investments, L.P. v. Angioli, 654 F.3d 846, 850 (9th Cir. 2011). Active involvement appears to be satisfied by (i) an affirmative act or (ii) control. For example, a manufacturer of dry cleaning equipment was not a contributor as a result of its design and sale of equipment that ultimately generated waste because it did not take an affirmative act to create an imminent harm, nor did it exercise control over persons using the equipment. Id. Even providing instruction to purchasers of the equipment to dispose of the waste in a manner that would violate RCRA was insufficient to subject the manufacturers to liability. Id.
Mere ownership is not determinative of liability either; “some level of causation between the contamination and the party to be held liable must be established.” New York Communities for Change v. New York City Department of Education, No. 11 CV 3494(SJ), 2012 WL 7807955, at *23 (E.D.N.Y. Aug. 29, 2012). For example, a sanitary district owning sewer lines was not a contributor of the hazardous waste discharged into sewers by users. Gregory Village Partners, L.P. v. Chevron U.S.A., Inc., No. C 11-1597 PJH, 2012 WL 832879, at *10 (N.D. Cal. 2012). The sanitary district exercised no control over user discharge except ordinary maintenance of the entire line and collection of fees from all users. This did not amount to a degree of control or an affirmative act of disposal by the district. Accordingly, the district was not liable for contribution of the hazardous waste discharged by other defendants into the sewer lines. Id. Similarly, a county owning a dump was not liable for the passive waste migration from the dump to neighboring properties because the county did not acquire the property until after the dump had ceased operations. Murtaugh v. New York, 810 F. Supp. 2d 446, 474 (N.D.N.Y. 2011). The county’s indifference to the waste’s existence did not amount to an affirmative act justifying a finding of contribution. “[A]ctive human involvement with the waste” must occur to establish liability under RCRA.
Courts evaluating whether an entity took an affirmative act that contributes to improper waste disposal invariably consider fault to make this determination. For example, a contractor without knowledge or any reason to suspect a subcontractor who had a history of unlawful activity was not a contributor to the spill caused by the subcontractor. National Exchange Bank & Trust v. Petro-Chemical Systems, Inc., No. 11-c-134, 2013 WL 1858621 (E.D. Wisc. Dec. 3, 2012). While the contractor had not generated the waste, the contractor failed to properly supervise and inspect the subcontractor’s work. The court noted that if the defendant knew or had reason to know the subcontractor had a history of illegal dumping, for example, the hiring of the subcontractor would be an affirmative act. Although “courts have concluded that Congress intended ‘contributed’ to be interpreted liberally, the court finds no reason to conclude that Congress intended the term ‘contributed’ to be an invitation to string together an expansive causal chain of tangential defendants.” Id. at *3. The court did hold the subcontractor to be a contributor because it was the subcontractor’s maintenance activities that led to the spill.
In contrast, a city that had both control over a contractor and knowledge that the contractor had a habit of illegal dumping was liable as a contributor under RCRA, despite not actually carrying out the disposal itself. Cox, 256 F.3d at 296. In Cox, while the city generated the waste, it was not the generation, but its negligent selection of a contractor to dispose of the waste properly that created liability. The city failed to require by contract that the contractor dispose of demolition materials in a legal landfill, and further, knew that the contractor operated its own unpermitted waste site. Id. at 297. Another court also used the knowledge and control elements to find that plaintiffs could be contributors in Carlson v. Ameren Corp., No. 10-01230, 2011 WL 223015, at *2 (C.D. Ill. Jan. 21, 2011). The plaintiffs sued defendants for contamination to the plaintiffs’ property. However, the plaintiffs also had denied defendants access to carry out remediation activities. By knowingly obstructing the defendants’ remediation of the plaintiffs’ contaminated property, the plaintiffs could be considered “contributors” to the hazardous waste because they actively allowed the waste to further contaminate the land. The plaintiffs’ obstruction amounted to “storage” of hazardous waste. The court denied the plaintiffs’ motion to dismiss defendant’s counterclaim related to the obstruction. These cases illustrate that assessment of liability based on a defendant’s (i) affirmative acts or (ii) control over the waste and knowledge of said waste is really an examination of the defendant’s intent.
The element of intent is essential to the execution of the RCRA statute. Not only is intent an inherent aspect of the recycling exemption, but it also signals the transformation from useful product to waste (i.e., a product becomes a waste when the person in possession intends to discard it). Further, the “intended use” provision allows certain chemicals to be used for a certain purpose without permit or penalty where the use of the same chemical in a different manner would be considered a violation of RCRA. However, the lack of the proper intent in these various situations can trigger a RCRA violation because the elements of an exemption are not satisfied. The consideration of intent contrives the idea that RCRA is strict liability.
Defendants have successfully used intent as a defense against liability under RCRA. For example, a carpet manufacturer had historically recycled carpet selvedge by shipping it to a company for recycling into board materials, park benches, and fiber lining for coats. Premier Associates Inc. v. EXL Polymers Inc., 507 Fed. Appx. 831, 834 (11th Cir. 2013). The manufacturer began shipping the selvedge to a new business associated with the original recycler. The new business did not actually recycle the selvedge, but began accumulating the material in its rented facility. The property owner sued the manufacturer for contributing solid waste to the facility, but the court rejected the claim because the manufacturer had a good faith intent that the selvedge was going to be recycled. The previous recycler had actually recycled the selvedge, indicating that the new business affiliate was also reputable. Further, once the manufacturer learned that the new business was only storing the materials, the manufacturer ceased shipments. Although the manufacturer took an affirmative action to ship the carpet selvedge to the facility, its intent was to recycle the materials, not store them in violation of RCRA such that the court relied on that intent to reject liability.
In Ecological Rights Foundation v. Pacific Gas & Electric Co., 713 F.3d 502, 515 (9th Cir. 2013), the court also relied on intent to determine liability. The defendant used, generated, and shipped PCP-based wood preservative on utility poles; stormwater runoff from the poles did not automatically become a solid waste, (during normal wear and tear). Because the company’s actions only furthered the “intended use” of the preservative, the preservative did not become a “waste” in run-off because it had not been “discarded.” The court noted that its holding was consistent with EPA’s position on the treatment of explosives and military munitions, which are not considered a “waste” if they are spent through “intended use.” (The court reserved judgment as to whether dangerous accumulation in the environment of PCP as a natural, expected consequence of its intended use would lead to a finding of “solid waste.”)
While the strict liability characterization of RCRA may be more commonly disputed, most courts and EPA would consider CERCLA’s standard of strict liability well established. CERCLA generally defines as liable any “owner,” “operator,” “arranger” or “transporter” of hazardous waste for the costs of environmental cleanup. CERCLA provides a limited number of defenses for the persons in the outlined categories on the basis of their objective position, and it does not explicitly define liability as strict. 42 U.S.C. § 9607(a)-(b). For example, under CERCLA, an owner of contaminated property is liable for cleanup even if the owner did not actively dispose of, generate, or handle the hazardous waste leading to the contamination. To distinguish its application from RCRA more plainly: CERCLA’s statutory framework imposes liability based on the identity of the defendant (“owner, operator, arranger, or transporter”), whereas RCRA imposes liability based on a finding of “contribution.”
Notably, at least one case has used intent to define liability under CERCLA. In Burlington Northern & Santa Fe Railway. v. United States, the Supreme Court determined that Shell did not “arrange” for the disposal of hazardous substances despite knowing that its distributors might spill those substances during the transfer process. 556 U.S. 599 (2009). Even though Shell knew that spills were a possibility, or even a probability, it “must have entered into the sale of D-D with the intention that at least a portion of the product be disposed of during the transfer process by one or more of the methods described in § 6903(3).” Id. Despite the strict liability mandate that supposedly accompanies CERCLA and RCRA, courts have acknowledged that an objective approach is not always appropriate.
In summary, the divergent judicial viewpoints on what is needed to trigger liability under CERCLA or RCRA require particular attentiveness to one’s involvement or association with a waste activity. Failure to fully understand the liability possibilities may result in triggering responsibility under CERCLA or RCRA.
