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The Year in Review

Environment, Energy, and Resources Law: The Year in Review 2022

Superfund and Natural Resource Damages Litigation Committee Report


  • The Superfund and Natural Resource Damages Litigation Committee Report for YIR 2022.
  • Summarizes significant legal developments in 2022 in the area of superfund and natural resource damages litigation.
Superfund and Natural Resource Damages Litigation Committee Report
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Superfund: Administrative and Regulatory Developments

Congress did not amend the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) in 2022.

The Environmental Protection Agency (EPA) added nineteen sites to the National Priorities List (NPL), including one Federal facility, while deleting five sites and partially deleting six sites. It also proposed to add two sites to the NPL and withdrew one previously proposed site.

In Daikin Applied Americas Inc. v. EPA, former owners of a metal fabricating facility challenged the NPL listing of the Highway 100 and County Road 3 Groundwater Plume site in Minneapolis, Minnesota. The court of appeals denied the petition for review, holding EPA’s decision to define the site as “a groundwater plume with no identified source” because there were several potential sources and its conclusion that the four aquifers were interconnected based on observed contaminant migration across the aquifers was not arbitrary and capricious.

EPA amended the All Appropriate Inquiries Rule (AAI Rule) to include ASTM International’s E1527-21 “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process” as a standard that may be used to comply with CERCLA’s all appropriate inquiry requirements to establish the bona-fide-prospective purchaser, continuous-property-owner and innocent-landowner liability protections. The prior version of the standard, ASTM E1527-13, will continue to be recognized as compliant with the AAI Rule until February 13, 2024.

On September 6, 2022, EPA published a proposed rule to designate perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS), including their salts and structural isomers, as hazardous substances under section 102(a) of CERCLA. Such a designation will require reporting of releases of PFOA or PFOS in quantities equal to or greater than the default reportable quantity of one pound in a 24-hour period to federal state, tribal, and local authorities pursuant to CERCLA section 103(A) and the Emergency Planning and Community Right-to-Know Act (EPCRA) section 304. In addition, Federal agencies will have to provide notice and covenants in certain circumstances if PFAS or PFOS “‘was stored for one year or more, known to have been released, or disposed of’” at a federally owned property being sold or transferred pursuant to CERCLA section 120(h). Finally, the designation will require the Department of Transportation to list and regulate PFAS and PFOS as hazardous materials under the Hazardous Materials Transportation Act pursuant to CERCLA section 306(a). The comment period for the proposed rule ended November 7, 2022 and a final designation is expected in August of 2023.

Effective April 8, 2022, EPA also designated 1-bromopropane as a CERCLA hazardous substance with a one-pound default reportable quantity given its listing as a hazardous air pollutant under the Clean Air Act.

EPA finalized its Environmental Justice Action Plan: Building Up Environmental Justice in EPA's Land Protection and Cleanup Programs (EJ Action Plan) in response to President Biden’s executive orders 13985 (Advancing Racial Equity and Support for Underserved Communities Through the Federal Government) and 14008 (Tackling the Climate Crisis at Home and Abroad) directing “federal agencies to promote and work toward [] achieving environmental justice.” The EJ Action Plan is a working document that includes best practices and projects to address environmental justice challenges in the Superfund and other land pollution prevention and cleanup programs.

Superfund: Judicial Developments

A. Constitutional Issues, Jurisdiction, and Standing

In United States v. Chemtronics, Inc., WASCO, LLC (WASCO) filed a motion to intervene following a Motion for Entry of Judgment of the Consent Decree for the Chemtronics Superfund Site. WASCO had previously filed a cost recovery claim with respect to a nearby, but non-contiguous, site alleging that industrial wastes created at the Chemtronics site were transported to and dumped at the nearby site. The court denied the motion to intervene, finding that the proposed Consent Decree’s definition of the Chemtronics site as including “any contamination emanating from it” could not be interpreted as including transportation and dumping at another location. Therefore, any liability protections afforded by the proposed Consent Decree would not extend to responsibility for contamination at the nearby site. Further, WASCO’s claims in its lawsuit were for cost recovery. Hence, the Consent Decree’s contribution protection provisions would not affect § 107(a) liability and, as such, WASCO did not show a sufficient interest to warrant intervention.

In United States v. Reilly Tar and Chemical Corporation, former owners of a downgradient metal fabricating facility appealed the district court’s denial of their motion to intervene to oppose the amendment of a consent decree at the Reilly Tar Site in Minnesota. The proposed interveners had been remediating their property for perchloroethylene (PCE) contamination and alleged the Reilly Tar Site was a source of the contamination, but the proposed amended consent decree did not address contaminant migration. The court affirmed the denial, holding that despite deletion of the undefined phrase “solvents and degreasers,” neither the original consent decree, nor the proposed amendment required cleanup of chlorinated volatile organic compounds (CVOCs), including PCE. As such, the proposed interveners lacked standing because there was no injury traceable to the amended consent decree. Nor was there a redressable injury since the contribution provision in the amended consent decree would not prevent a contribution action if liability for migration of CVOCs was established.

B. Elements of Liability


1. Facility Definition


Cyprus Amax Minerals v. TCI Pac. Communs., LLC involved the cleanup of the Collinsville Soil Program (CSP) study area of waste from two zinc smelters. Cyprus operated one of the smelters and alleged that defendant TCI was the successor to a parent company liable for the other. Defendant TCI argued that the district court erred in concluding that the CSP Study Area, including the two smelters, was a single facility, especially since EPA was conducting a response action at one of the smelters. The court of appeals, however, rejected the argument, finding “the district court correctly identified a viable migration pathway by concluding residents and others transported waste from the smelters to other locations within the CSP Study Area.” The court of appeals also held that the government’s response action at the one smelter was a removal action and that the cleanup of the CSP study area was a remedial action, but “the fact that there are two separate responses does not mean that there are two CERCLA facilities.”

2. Release or Threatened Release

Lovejoy v. Amcox Oil and Gas, LLC involved cross-motions for summary judgment by plaintiff (Ms. Lovejoy) and defendant Amcox Oil and Gas, LLC (Amcox). Amcox was the owner of a natural gas well and pipeline that sits on Ms. Lovejoy’s property. Ms. Lovejoy alleged that hazardous and solid waste from the well and pipeline had migrated onto the property. As pertinent here, the court denied Amcox’s motion for summary judgment on Ms. Lovejoy’s claim that Amcox was liable for response costs under CERCLA because there were triable issues of fact regarding whether there was a “release” of hazardous substances from the well and pipeline. The court held that Ms. Lovejoy just barely established a prima facie case that a release occurred by inference from evidence of odors and staining around the facility and publications that hazardous substances are attributed to some oil and gas operations.

In California Department of Toxic Substances Control v. NL, plaintiff (DTSC) sought recovery of environmental cleanup and response costs under CERCLA from a number of defendant owners and operators of “a former lead battery recycling plant [] in Vernon, California (the Vernon Plant). The multi-day bench trial centered on the question of whether releases from the Vernon Plant plausibly could have caused the lead contamination in nearby residential areas. Despite DTSC’s presentation of background concentrations, wind modeling, statistical analysis, and soil chemistry, the court found that DTSC did not establish that the “releases” from the Vernon Plant plausibly could have caused the contamination of lead, which is ubiquitous in urban areas. The evidence was also insufficient to establish the required nexus between the Vernon Plant’s releases and the cleanup costs DTSC incurred.

C. Liability of Particular Parties

1. Owners and Operators

In MRP Properties Co., LLC v. United States, the court granted the Government’s Motion for Certificate of Appealability and to Stay Proceedings to allow the appeal of an order granting summary judgment of the Government’s liability as an operator of twelve refineries before and during World War II. The court held that there was a substantial question as to whether the Sixth Circuit’s actual control standard of operator liability set forth in United States v. Township of Brighton would apply in light of the Third Circuit’s conflicting “macro-management” standard, the fact that Bestfoods did not explain the meaning of “operations specifically related to pollution,” and the absence of Sixth Circuit precedent specifically addressing the issue.

2. Generators, Transporters, Arrangers

In 68th Street Site Work Group v. 7-Eleven, Inc., Plaintiffs asserted claims under CERCLA to recover response costs for a release of hazardous substances from the 68th Street Dump Superfund Alternative Site (68th Street Site) consisting of seven landfills at which municipal, industrial, and commercial wastes were disposed. The court previously granted several “of the original defendants’ motions to dismiss and/or motions for summary judgment.” In the instant motion, Plaintiffs moved to amend their Complaint against a subset of the Defendants. Among other challenges to successor liability and standing, the Defendants opposed the motion to amend, arguing that the Amended Complaint did not adequately allege arranger liability. The court agreed in a January 26, 2022 ruling, holding that CERCLA requires “specific intent to dispose of hazardous waste not just waste that may or may not contain hazardous substances” and Plaintiff’s Amended Complaint did not rectify that deficiency. Plaintiffs filed a motion for a certificate of appealability to appeal the dismissal, which was denied because the complaint remained against four defendants. Three of the four defendants then filed motions for judgment on the pleadings based on Plaintiffs’ purported lack of standing and the Complaint’s failure to allege arranger liability. The court granted the motion for judgment in its May 10, 2022 ruling, holding that there were “no meaningful differences between Plaintiff's allegations against the moving Defendants and the allegations” construed by the court in its prior opinion.

In City of Las Cruces v. Lofts at Alameda, LLC, the court held that Plaintiff’s allegations were sufficient to assert an arranger claim under CERCLA and survive a motion to dismiss where the complaint contained allegations from which it could be inferred the defendant knew or should have known its waste contained hazardous substances. Specifically, the complaint alleged defendant arranged for the disposal of a large amount of liquid chemicals that had an “obnoxious odor,” made employees feel “high,” dried out their skin, and turned their skin white. The court also held that defendant’s alleged “understanding with a local pumper truck driver” to come and remove the used PCE when notified was sufficient to support an inference that defendant had an agreement for the transport or disposal of the used PCE.

In re Gold King Mine Release involved a partial motion for summary judgment by defendant Weston Solutions, Inc. (Weston) to dismiss CERCLA claims brought by the plaintiffs, State of New Mexico and the Navajo Nation. In obtaining summary judgment, Weston successfully claimed that it was “a technical assistance contractor [] responsible for documenting work, taking measurements, and performing environmental sampling at the Gold King Mine…not a ‘transporter,’ ‘operator,’ or ‘arranger’” under CERCLA. The district court held that Weston did not accept water from the Gold King Mine or select a disposal location for the water from the Gold King Mine, and did not possess, own, or control the water impounded in the Gold King Mine.

In City of Las Cruces v. Lofts at Alameda, LLC, City of Las Cruces and Dona Ana County (Plaintiffs), moved to dismiss defendant American Linen Supply of New Mexico, Inc.’s (American Linen) CERCLA counterclaims and third-party claims, and to strike American Linen’s affirmative defenses to CERCLA liability. American Linen brought third-party transporter claims against, Bertha Villanueva, both individually and on behalf of the estate of her husband, Jesus Villanueva, and against Victor Jasso. It alleged “that Jesus Villanueva, who died in 2016, owned and operated a pumper truck company” and was hired by American Linen to haul waste containing PCE away from the American Linen plant that he disposed of at the Las Cruces Flood Control Dam. It further alleged that Victor Jasso assisted Jesus Villanueva to dispose of the waste. The court dismissed the claims against Bertha Villanueva, individually, concluding there were no allegations she was personally involved with transportation of the waste. The court also dismissed the claims against the Estate of Jesus Villanueva, stating that CERCLA does not extend liability to the estate of a deceased potentially responsible party (PRP), but ultimately concluding that New Mexico’s non-claim statute of limitations for claims against decedent estates bars American Linen’s third-party claim. Finally, the court dismissed the claims against Victor Jasso because American Linen did not successfully plead that Victor Jasso “accepted” a hazardous substance for transport or that he had substantial input into deciding where to dispose of the materials in Jesus Villanueva’s pumper truck.

In Emhart Indus. v. New England Container Co., Emhart brought contribution claims against a number of parties alleging they were not “arrangers” for disposal of hazardous substances at a drum reconditioning facility for drums sent between 1948 and 1972. The court denied defendants’ motions for summary judgment, holding that whether defendants’ drums contained solvent residues, and, if so, whether leaving residual amounts of solvents in the drums supports “‘an inference of purposeful or intentional disposal’ is a question for trial.” The court also held that intent could be inferred from the economic arrangements between defendants and the drum recycler. Finally, the court concluded that the “useful product” doctrine did not entitle defendants to victory. To the contrary, the court held that a reasonable factfinder at this stage could alternatively find that used drums containing residue served no useful purpose.

3. Parent/Shareholder and Successors

In Cyprus Amax Minerals v. TCI Pac. Communs., LLC, the court of appeals affirmed the district court’s decision to pierce the corporate veil of Defendant TCI’s predecessor’s subsidiary under Kansas common law based largely on evidence that defendant’s predecessor had previously represented to a government agency that its subsidiary was “effectively a department of [the parent].”

In Starlink Logistics Inc. v. ACC, LLC, defendant Smelter Service Corp. (SSC) sought summary judgment as to plaintiff Starlink Logistics, Inc.’s (Starlink) claim that SSC was derivatively liable under CERCLA. SSC was the corporate parent of ACC, LLC f/k/a Associated Commodities Corporation (ACC), and Starlink argued that SSC’s liability derived from ACC’s liability based on SSC’s active participation and control over ACC, as opposed to SSC’s active participation and control over the landfill itself. The court found that derivative liability under CERCLA could be based only on piercing the corporate veil in accordance with Tennessee law, and that the veil of an LLC could be pierced to reach the LLC’s parent corporation, but only if so doing is warranted under the test outlined in Cont’l Bankers Life Ins. Co. of the South v. Bank of Alamo. Based on undisputed facts, the court found that Starlink could not satisfy the test’s requirements for the period before January 2, 2009, “because SSC and ACC had no parent-subsidiary relationship during that [period].” For the period after January 2, 2009, however, the court held that SSC failed to meet its burden as the summary-judgment movant to show that Starlink could not satisfy the test’s requirements.


D. Private Cost Recovery


1. Contribution (113) v. Cost Recovery (107)

101 Frost Street Assoc., LP v. U.S. DOE involved a cost recovery and contribution action against defendant, the United States Department of Energy (DOE), and others, including defendant and Third-Party Plaintiffs GTE Operations Support Incorporated (GTEOSI), GTE Sylvania Incorporated, and Sylvania Electric Products (collectively, GTE/Sylvania) arising from the investigation and remediation of groundwater contamination at sites in Nassau County, New York. DOE and Third-Party Defendant, the United States of America (collectively, the Federal Defendants), moved to dismiss GTE/Sylvania’s third party claims asserted under CERCLA, sections 107 as well as GTE/Sylvania’s claim for declaratory judgment. The magistrate judge looked to Territory of Guam v. United States and Consol. Edison Co. of N.Y. v. UGI Utils., Inc., holding that the liability release GTE/Sylvania received under two voluntary settlement agreements with the New York State Department of Environmental Conservation did not trigger a CERCLA 113 contribution claim because the releases did not resolve federal CERCLA liability. Thus, the magistrate judge recommended that the court deny the Federal Defendants’ motion to dismiss.

In Atl. Richfield Co. v. NL Indus., a third-party claim brought by NL against two alleged third-party contribution defendants was recommended for dismissal by the magistrate judge because NL itself was a defendant in a contribution action, not a cost-recovery action, and could only be responsible for its equitable share of liability to the plaintiff. Because it would not be paying more than its fair share, it had no contribution claim.

City of Lincoln v. County of Placer involved a motion for judgment on the pleadings by defendant and cross-claimant County of Placer (County). For over twenty years, plaintiff City of Lincoln (City) “owned, operated, and maintained a landfill in Placer County, California.” “The City allege[d] [that] the County generated, transported, and arranged for the disposal of hazardous waste at the landfill” and filed several claims against the County to recover costs to remediate groundwater, soil, surface water, and air contamination at the landfill. On the City’s cost recovery and contribution claims under CERCLA, the court granted the County’s motion for judgment on the pleadings without leave to amend, holding that the California Regional Water Quality Control Board’s Abatement Order requiring the City to investigate and remediate the landfill contamination did not function as a “civil order” for the purposes of CERCLA section 106. Therefore, in the absence of predicate CERCLA liability, the City could not bring a CERCLA contribution claim.

United States v. Union Oil Co. represents the latest in the decisions involving the McColl Superfund Site. In this matter, the United States was seeking response costs under section 107(a). The costs were incurred to address non-benzol waste. The law of the case was that the United States was liable for benzol wastes, but not non-benzol wastes. Nonetheless, defendants argued that the United States was limited to a contribution action under section 113(f). The district court disagreed, and the Ninth Circuit affirmed. “Because the United States' non-benzol costs were voluntarily incurred rather than required by a judgment or other order imposing CERCLA liability, it may not pursue a § 113(f) contribution claim for non-benzol costs and properly proceeded for cost recovery under § 107(a).”

2. Effect of Settlement


Unlike cases where settling parties seek court approval to obtain a contribution bar, Barclay Lofts LLC v. PPG Indus. involved a settlement by Barclay with multiple defendants (MD Defendants) that was not accompanied by a motion to approve the settlement. Barclay dismissed the MD Defendants after the settlement and the other defendants, PPG and Hydrite, filed third-party complaints against the MD Defendants. They also filed counterclaims against Barclay and crossclaims against each other and another defendant, Lumimove. Barclay and the MD Defendants unsuccessfully moved to dismiss the third-party complaints. The court held that the private settlement between Barclay and the MD Defendants did not create a contribution bar, especially where the settlement was not judicially approved. While the motion to dismiss was pending, Barclay then settled with Lumimove. PPG and Hydrite did not oppose dismissal of Barclay’s claim against Lumimove, but argued that their crossclaims against Lumimove remained intact. The court agreed, holding that, without court approval, Barclay’s private settlements were not binding on PPG or Hydrite. Thus, while Barclay’s claims against Lumimore were dismissed, PPG and Hydrite’s cross claims for contribution remained.

In Fansteel Metals, Inc. v. Muskogee City-County Port Auth., plaintiff had reached an “Environmental Settlement Agreement” (ESA) with the United States and the Oklahoma Department of Environmental Quality (ODEQ) in connection with a facility formerly owned and operated by Fansteel. It received contribution protection in the settlement. It then brought both a cost recovery and contribution action against defendant Port Authority, among others. The Port Authority moved to dismiss the cost recovery claim, arguing that Fansteel was limited to a contribution action after resolving its liabilities to the United States and ODEQ in the ESA and receiving contribution immunity. The court agreed that Fansteel could not use its immunity as both a “sword and a shield” and was limited to a contribution action to recover costs for which Fansteel resolved its liability in the ESA. Fansteel’s argument that it was seeking some costs that were not addressed in the ESA was rejected because of the broad scope of the ESA, which covered "all response actions taken or to be taken, and all response costs incurred or to be incurred."

City of Las Cruces v. Lofts at Alameda, LLC involved CERCLA settlements that contained overbroad contribution protection clauses. Movants (plaintiff and three defendants) were seeking to dismiss plaintiff’s CERCLA claim as well as cross-claims brought against the defendants by co-defendant American Linen. The case involved releases to groundwater that resulted in a contaminant plume being remediated by plaintiff. There was no objection to the dismissal of claims brought by plaintiff that were being settled. Still, American Linen objected to the dismissal of its cross-claims against defendants. The court agreed with the objection. Section 113(f)(1) “expressly states that American Linen ‘may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action . . . under section 9607(a) of this title.’” Because section 113 permits a contribution claim “during” a civil action under section 107, the motion to dismiss American Linen’s cross-claim was denied.

E. Allocation and Indemnification

Columbia Falls Aluminum Co. v. Atl. Richfield Co. involved successive owners of an aluminum smelter near Columbia Falls, Montana. Atlantic Richfield Company (ARCO) (through its predecessor, Anaconda) operated the site from 1955 to 1985. Columbia Falls Aluminum Company, LLC (CFAC) acquired the facility in 1985, operated it until 2009, and was the current owner of the facility. ARCO produced about 7.1 million pounds of aluminum in its operations. CFAC produced about 6.3 million pounds. CFAC argued that in the period 1960-1980, ARCO disposed of 129,000 to 135,000 tons of spent potliners (SPL), “a principal waste generated by aluminum reduction which contained cyanide and fluoride in two unlined landfills: the West Landfill and the Center Landfill.” It also argued that ARCO alone disposed of sludge from wet scrubbers in the Wet Scrubber Sludge Pond from 1955 through approximately 1979 and that ARCO alone disposed of another waste from its aluminum production operations—sludge from wet scrubbers that was composed of 80% calcium fluoride—in the Wet Scrubber Sludge Pond (WSSP) from the beginning of ARCO's operations at the Site through approximately 1979. ARCO argued that the parties’ 1985 Acquisition Agreement foreclosed the suit. In the alternative, it argued that CFAC’s costs are not recoverable or were covered by CFAC’s indemnity to ARCO, but to the extent any costs were recoverable, “CFAC should be allocated greater responsibility for those costs based on the Acquisition Agreement, CFAC's failure to exercise due care in its operation and closure of the facility, CFAC's own discharges of hazardous materials, and the economic benefit CFAC realized or will realize from the Site.”

After rejecting the contract arguments (CFAC agreed not to make a claim with respect to ARCO’s indemnity after 1990, but CFAC was pursuing a right to contribution under CERCLA and not a contractual indemnity claim, and the assumption of liability clause was too narrow to include CERCLA liabilities), and after rejecting CFAC’s expert’s allocation (52.9% to CFAC and 47.1% to ARCO), the court addressed allocation by first evaluating the Gore factors. The court held that the first four factors, encompassing the nature and volume of waste, did not favor either party since the parties operated the same facility for similar amounts of time, produced the same product in similar quantities, and, while ARCO’s SPL waste in the West Landfill was primarily responsible for the groundwater contamination, the slurry wall remedy would encompass both the West Landfill and the WSSP where both parties disposed of waste, and CFAC was solely responsible for wastes disposed in other landfills on the site and the Former Drug Storage Area. The degree of care factor weighed “slightly in favor of allocating more responsibility to CFAC” because CFAC did not apply for a RCRA hazardous waste storage permit in 1989 and knowingly avoided regulatory requirements and scrutiny which would have resulted in investigations and RCRA corrective action measures that, if timely implemented, would likely have reduced the scope and cost of the current CERCLA remedial measures.

Regarding cooperation, CFAC was credited for voluntarily entering into an Administrative Order on Consent with EPA and “its consistent cooperation and coordination with EPA throughout the remediation process.” On the other hand, ARCO was invited to participate in the Superfund process and “chose not to,” and during operation of the facility, ARCO “implemented certain environmentally friendly protections-such as its dry scrubber system-only after the facility emitted so much fluoride that it killed the surrounding vegetation.” In addition, although ARCO argued it had a history of cooperation with EPA, cross examination showed that ARCO “fought tooth-and-nail to avoid paying the $1,027,721,000 it has paid to cleanup former industrial sites in Montana.” The court concluded that the Gore factors warranted an equal assignment of liability, but that “qualitative considerations” – primarily the contractual indemnity -- tipped the scales in ARCO’s favor inasmuch as it was “the parties' intent, as reflected in the circumstances of the sale and their subsequent conduct, that ARCO would have no further liability to CFAC five years after the sale,” and CFAC’s indemnity was perpetual. Ultimately, the court held that the proof supported an allocation of 65% to CFAC and 35% to ARCO. These percentages were applicable to past and future costs with the unique caveat that ARCO would receive a credit towards its outstanding CERCLA obligation of 35% of the expected value (determined by expert testimony) of the industrial portion of the property after remediation. It directed the parties to confer on how the credit should be applied.

As noted already, Cyprus Amax Minerals v. TCI Pac. Communs., LLC involved the cleanup of the Collinsville Soil Program (CSP) study area as a result of waste from two zinc smelters. Cyprus operated one of the smelters from 1911 to 1918. It alleged that defendant was the successor to the New Jersey Zinc Company (NJZ), which owned the shares of Tulsa Fuel & Manufacturing Co. (TFMC). TFMC, in turn, owned and operated the other smelter from 1911 to 1926. Cyprus was seeking cost recovery and contribution. TCI admitted it was the successor to NJZ. Hence, the issue was whether NJZ was responsible for TFMC’s CERCLA liabilities. The court held that it was, piercing the corporate veil and holding TCI liable for contribution in the amount of $14,265,070.20 in past costs and 45% of any future response costs. The allocation was apparently not challenged on appeal.

Chevron Mining Inc. v. United States involved a molybdenum mining site allocation at the Questa Site. Chevron (Molycorp.) received 70% of the response costs. The United States was assigned the remaining 30%. A lot was at stake--the cleanup will cost about $1 billion. Chevron operated the mine, performed all waste rock and tailings disposal activities, and was not coerced by the United States to operate the mine--it sought to make a profit. However, the court found, without the involvement and encouragement of the United States, the mine “likely would not have been developed.” The United States had sought a zero allocation because it had “bare legal title” to some of the land in question for a limited time, Chevron owned the land and the wastes for “a much longer period,” Chevron had sole control over mining and waste disposal, and it was “solely responsible for the environmental conditions it created.” However, the court found that the United States "actively encouraged mining activities on its lands" with its "continued oversight and involvement in operations" at the Questa Site. In addition, both Chevron and the United States “‘had knowledge of and acquiesced to the site specific and inherent environmental issues associated with open pit mining.’”

The court also held that it would be inequitable to allocate Chevron 100% of the response costs when the United States knew how Chevron disposed of the waste rock and tailings. Specifically, in 1957, the Defense Minerals Exploration Administration (DMEA) loaned Chevron funds to mine a low-grade molybdenum ore body, knew that this ore body would result in a “substantial amount of waste rock,” provided favorable loan terms and free expert mining advice, and actively oversaw the exploration through on-site inspections and monthly reports. In addition, “the DMEA's mineral discovery certification substantially increased Molycorp's options for private funding for the development of the Open Pit Mine.” The United States also “‘repeatedly exercised its plenary regulatory authority over’ National Forest lands surrounding the Questa Site for the purpose of enabling Molycorp to continue its waste rock and tailings disposal activities.” “Without the government's repeated exercise of this regulatory power, the mining operations at the Questa Site likely could not have continued.” A land exchange initiated by the government that occurred in 1974 also “resulted in the increased size and slope of the three roadside waste rock piles that have become the most dangerous and costly to remediate.”

National defense also played a role in the court’s allocation. “The government pursued the DMEA Contract at the Questa Site partly because of molybdenum's strategic value in the national defense effort. The Questa Site's molybdenum production also resulted in a lower cost of molybdenum for end consumers, including the United States.” So did the mine’s impact on the local economy of northern New Mexico. “The United States made it a priority to provide economic stimulation for this region, and the Questa Site became the major source of economic stimulus.” The court rejected Chevron’s arguments regarding the mine’s contribution to federal and state tax revenues. It also determined that the degree to which Chevron profited or did not profit from its operation was immaterial to the equitable allocation. The government’s argument that Chevron would receive “windfall benefits” if the United States was allocated anything was rejected because there was no evidence that Chevron had “indirectly recovered response costs from the government in the past, and Chevron's lawful use of National Forest land during its operation of the Questa Site does not constitute an ‘unfair double benefit.’”

In Santa Clarita Valley Water Agency v. Whittaker Corp., a jury had previously found plaintiff 10% negligent in rendering an otherwise favorable verdict on plaintiff’s trespass and nuisance claims. In the subsequent bench trial on a CERCLA contribution counterclaim, plaintiff was also allocated 10% of its investigation, permitting, and design response costs of $675,000 (the court rejected claims for replacement and blend water costs of $11.5 million because they were included already in the jury verdict on the common law claims). The court applied the Gore factors. Defendant was the source of “massive quantities” of perchlorate contamination in groundwater, and while it did conduct a clean-up, it was “not fully forthright with the regulators and attempted to conceal its improper waste-disposal practices” and “sought to avoid having to install monitoring wells that could have resulted in earlier detection and cleanup of contaminants.” As for plaintiff, the jury “found that Plaintiff bore some responsibility, [but] the relative amount of fault was minimal.” In addition, Plaintiff was not the generator of the waste, but rather “neglected to respond properly at all times to the contamination produced by others.” An equitable-allocation argument by defendant that its conduct was in furtherance of the “nation’s security goals” was rejected.

Gould Elecs. Inc. v. Livingston Cnty. Rd. Comm’n involved an appeal of a contribution judgment entered against Livingston County Road Commission (LCRC) by which Gould was allocated 95% of the response costs. The allocation was not challenged on appeal, however. Instead, the district court’s decision to try the action by videoconference during the COVID-19 lockdown was the focal point of the appeal. That argument failed. The allocation decision appears in a 2020 opinion. Gould had brought a cost recovery action to recover costs incurred in response to trichloroethylene (TCE) releases to soils and groundwater on its property (caused by Gould’s predecessor) that had migrated onto LCRC’s neighboring property. Relying on the Gore factors, the district court found that Gould was the sole source of TCE (rejecting Gould’s expert testimony that LCRC was also a source of TCE releases) resulting in a 95% allocation, but that LCRC failed to cooperate with state agency requests for further investigations on its property and, when it did act, was slow to act, resulting in a 5% allocation.

Two cases involved allocations conducted by third-party neutrals. In Occidental Chem. Corp. v. 21st Century Fox Am., Inc., a Special Master rejected a motion for a protective order sought by the Small Parties Group (SPG) Defendants. The case involves the Passaic River sediment contamination site. Plaintiff sought, among others, communications with FTI, a consulting firm that had conducted some allocation work at the site, all documents regarding the decision to participate in the “Batson Process” (referring to the neutral retained by EPA to conduct the allocation), and documents regarding the decision to terminate or cease the allocation process. The Special Master determined that the SPG defendants failed to establish good cause to warrant issuance of a protective order. He further determined that privileged or work product information could be redacted and that a privilege log had to be prepared for such information. The other case is Port of Seattle v. Boeing Co., which involved the allocation performed at the Lower Duwamish Waterway (LDW) Superfund Site by an experienced environmental lawyer. The final allocation report was issued in 2022 and all parties except the Port of Seattle accepted the results. The Port then sued Boeing under CERCLA. In the meantime, Boeing and the other Participating Parties were engaged in cash-out settlement negotiations. Boeing sought to stay the litigation through April 2023 to allow those negotiations to be concluded. The court granted the motion over the Port’s objections, finding there was no meaningful impact on the Port from the brief delay, whereas the lack of a stay would mean the filing of third party claims which could potentially jeopardize the eight-year allocation and settlement process harming Boeing and the other Participating Parties. Finally, the court held that “the Participating Parties’ allocated shares are relevant to the court’s equitable allocation of the LDW cleanup costs between the Port and Boeing” and “it will be easier and more efficient for the court to consider the responsibility of all parties for the contamination at the LDW once the Participating Parties finalize their settlements and enter into a consent decree with the EPA.”

Asarco, LLC v. Noranda Mining, Inc. touched on allocation in denying a motion to lift a 2017 stay of the litigation, pending EPA’s issuance of a Record of Decision. In 2009, Asarco, a bankruptcy debtor, settled EPA’s claims at the Richardson Flat area (a part of the Lower Silver Creek site) for $7.4 million. In 2012, Asarco filed a contribution action against Noranda, which ultimately resulted in a stay that the court said it would lift after EPA completed its “Engineering Evaluation and Cost Analysis” (EE/CA) and approved a remedy for the Lower Silver Creek site so that the court could then determine whether Asarco paid more than its fair share in the settlement (as is needed to establish a contribution claim). Asarco sought to have the stay lifted, arguing in part that the remediation plan was irrelevant to an equitable allocation. The court disagreed. It held that EPA’s EE/CA would educate the court “as to several equitable factors: the amount of hazardous waste, the degree of toxicity, and consequently the parties' degree of involvement and degree of care relative to the waste.” In addition, the data could lead to liability of previously unidentified responsible parties so waiting for the report could avoid the need to reallocate liability.

In In re Stratus Redtail Ranch LLC v. IBM, the Court rejected the testimony of a lawyer on how to allocate the matter. The court found that the testimony “would not be helpful” because the expert’s report “merely assumes the Court's role of weighing the equitable factors and arriving at an allocation ‘recommendation.’”

Numerous settlements were approved in 2022 that considered allocation in the context of substantive fairness.

In Citizens Dev. Corp. v. Cnty. Of San Diego, the district court approved three settlements applying both CERCLA (the agreement is substantively fair considering what is being paid in relation to the settling party’s potential allocation, and whether it is procedurally fair, reasonable, and consistent with CERCLA’s objectives) and California law. Because the court found the settlements were made in good faith, the settling parties received protection from contribution claims. The settlements in issue with the cities of San Marcos and Escondido and the County of San Diego related to contamination of the surface water and groundwater in and around Lake San Marcos (the Lake) and San Marcos Creek (Creek), located in San Marcos, California. There were dueling experts on what plaintiff Citizen’s Development Corporation's (CDC) potential recovery might be, resulting in widely divergent views of what proportion of the potential recovery was represented by the $3.4 million being paid by San Marcos. The court did not formally determine San Marcos’ allocation, concluding instead that arguments advanced about the application of the Gore and other equitable factors and the standards established in Tech-Bilt did not have to be definitively resolved since the payment of $3.4 million represented between 23% and 55% of the potentially recoverable costs and, thus, was within a “reasonable range” of San Marcos’ proportionate liability. As for Escondido, the experts focused on its watershed acreage and nutrient loading in arguing about its proportionate share. The resulting range of exposure was $200,000 to $1,760,000. Escondido agreed to pay $1.3 million, which was within the equitable “ballpark.” The County agreed to pay $2.6 million in relation to expert allocations placing its share at between $1.38 and $6.94 million. Again, the court determined that this was within the ballpark of an equitable share for settlement purposes.

In Torres v. Igdaloff, the district court determined that a settlement was made in good faith. While the opinion is not clear on whether the settlement included a CERCLA claim versus a state-law claim, the court also evaluated the settlement under Tech-Bilt, Inc. v. Woodward-Clyde & Assocs. The Torres case involved perchlorethylene (PCE) contamination. Settling parties (the Torreses and TSM parties) were former owners or operators of the facility in issue. Union Pacific estimated that the total cost of remediation were between $8.1 and $9.2 million, including $2.6 million already spent on cleanup costs. “Experts retained by the parties calculated the allocation shares of the Torreses and TSM parties as between 1.54 and 12.74%.” The settlement amount was $500,000, in addition to the $134,000 the Torreses and TSM parties had already incurred as cleanup costs. Thus, the Torreses and TSM parties were paying 6.8-7.8% of the total estimated remediation costs, which was within the “ballpark” under Tech-Bilt, despite arguments made by one objector to the contrary.

Garrison Southfield Park LLC v. Closed Loop Ref. & Recovery, Inc. involved settlements for response costs incurred at a site involving electronic waste. Defendant Green Wave was paying $106,204, which represented the full amount of its share of costs based on a formula used in prior settlements that had been approved by the court (comparing the weight of e-waste shipped to the site by a PRP divided by the total weight of e-waste shipped by all PRPs). The settlement agreement also contained a reopener if it was discovered that Green Wave was “‘affiliated with another non-settling, potentially responsible party in connection with this matter’ or if ‘the weight of the materials attributable to [Green Wave] is at least 50,000 lbs in excess of the weight of the materials’” used to calculate Green Wave’s volumetric share. The agreement was also conditioned on a contribution bar that included contractual claims against the settling parties by original equipment manufacturers. Movants asked the court to credit the settlement payments pro rata (plaintiffs absorb the settling party’s equitable share) rather than pro tanto (a dollar-for-dollar reduction in plaintiffs’ claim). Based on a prior decision endorsing the pro tanto approach, the court rejected this argument. While the court accepted the allocation formula for purposes of substantive fairness, it rejected the settlement because it barred contractual claims between Green Wave and others not party to the settlement agreement. Hence, it held the motion for approval in abeyance pending a decision as to whether Plaintiffs and Green Wave would “accept the Court's approval of the settlement agreement on the understanding that the contribution bar does not extend to claims for express breach of contract and contractual indemnification.” There was a separate motion to approve a settlement with another defendant, Dynamic, for 97% of its volumetric share. The court determined the payment amount was substantively fair, but because of a similar overbroad contribution bar, it held the motion for approval of the settlement in abeyance, again inviting the parties to advise the court if they would accept a narrower contribution bar.

United States v. IMC E. Corp. resulted in the entry of consent judgments against two parties (ITC and IMC) over objections by other potentially responsible parties. The cleanup was estimated to cost $75,000,000. Based on expert testimony, ITC contributed an estimated 0.45% towards the contamination at the site. ITC’s settlement payment was $687,500, or about double its proportionate share ($75 million x. 0.45% = $337,500). Hence, taking into account the estimate of total costs and ITC’s comparative culpability, the settlement was substantively fair, the district court held. IMC’s settlement payment was $1,000,000. Substantive fairness does not have to turn on whether a settling party is paying a reasonable amount where the settling party has an inability to pay. That was the case for IMC. The settlement was based on a review of IMC’s financial, tax, and insurance records by a financial expert retained by EPA, the results of which were accepted by the court. The settlement and the consent judgment were also conditioned upon the veracity of the financial information provided by IMC which the court regarded as an additional precautionary measure supporting a finding of substantive fairness.

United States v. N. Ind. P.S.C. LLC resulted in the court’s approval of a consent decree requiring defendant (NIPSCO) to remediate coal ash released to soil and groundwater during historical site operations. The court found that the decree was substantively fair “because it imposes on NIPSCO significant burdens both of responsibility for remedying contamination that originated from its Michigan City power plant and of shouldering the costs incurred by the state and federal governments in responding to NIPSCO's releases of hazardous substances.” The court added that “[t]he determination of comparative fault should be upheld unless it is arbitrary, capricious, and devoid of a rational basis,” before concluding that the decree “meets the test of assessing appropriate accountability on NIPSCO.”

BASF Corp. v. Curia Glob., Inc. involved approval of a CERCLA contribution-action settlement, this one between BASF and the United States in connection with contaminated sediments in the Hudson River. In 1942, the Treasury Department seized General Aniline and Film Corporation pursuant to the Trading with the Enemy Act, and then transferred ownership to the Alien Property Custodian. In 1965, the United States sold General Aniline and Film Corporation in a public offering. However, between 1942 and 1965, the facility was the source of discharges into the Hudson River. The United States disputed liability, arguing it only owned stock and did not own real property or exercise control over operations at the facility. BASF incurred $35 million in response costs and expected to incur another $3.5 million. The settlement amount was $3,975,000. The court held that this amount was substantively fair, despite the settlement amount not corresponding to the United States’ years of ownership. The court added that the parties were “sophisticated actors” who knew how to protect their own interest and were capable of evaluating risks and rewards, and thus the court had “little need” to police substantive fairness.

In Berendo Prop. v. Closed Loop Refining & Recovery, Inc., the court approved a consent decree resolving a defendant’s (UNICOR) liability for disposal of cathode ray tubes (CRT). As to substantive fairness, the court held:

Plaintiffs allege—based on Closed Loop's records—that UNICOR was responsible for 14 million out of the 195 million tons of CRT waste that reached the warehouse. This amounts to a little over 7% of the total CRT waste. The estimated cleanup cost is over $15 million. The $995,000 that UNICOR is agreeing to contribute to cleanup costs therefore represents a little over 6.6% of the total cleanup costs. Because the settlement amount is proportional to UNICOR's share of responsibility and the funds will be put toward cleanup efforts, the consent decree is substantively fair and reasonable.

Maxim I Props. v. Krohn is the rare case where a motion to approve a settlement of a CERCLA claim was denied. The putative settling party, Moyer, was a dissolved corporation. Its only asset apparently was an insurance policy. It was “likely a major source of the contamination” in issue. It was paying $1.7 million, none of which would have been applied to the remediation of the site. Instead, it would cover plaintiffs’ litigation fees and costs in both the contribution action and a separate state regulatory agency enforcement action. Moyer would have received contribution protection if the settlement was approved. But the movants failed to present evidence of the scope of plaintiff’s potential recovery, defendants’ total exposure, or Moyer’s and non-settling parties’ estimated proportional shares of exposure. Thus, there was no evidence about how to apportion liability under CERCLA. “In fact, neither side explained what liability exposure the court should evaluate in this motion.” When a court is unable to evaluate substantive fairness due to a lack of evidence and the settlement payment is not being used for remediation, it will not approve a CERCLA settlement. This case is proof of this principle. “An Agreement that entails no remediation and instead provides for reimbursement of litigation expenses fails to further CERCLA’s policy aims.”

F. Defenses

1. Act or Omission of Third Party: Landowner Liability Defenses


In Santa Clarita Valley Water Agency v. Whittaker Corp., Santa Clarita Valley Water Agency (Plaintiff) asserted the innocent landowner defense, arguing that it should not be responsible for cleanup costs at the 22116 West Soledad Canyon Road site in Santa Clarita, California. The court, however, reframed the claim as one for a “third party” defense and held a jury’s prior assignment of 10% fault to Plaintiff on its negligence claim was reasonable and meant that Plaintiff’s negligence was a substantial factor in causing its harm. As such, Plaintiff failed to demonstrate that a third party was the sole cause of the release or that Plaintiff exercised due care with respect to the hazardous substance concerned.

In Stratus Redtail Ranch LLC v. International Business Machines, Plaintiff Stratus Redtail Ranch LLC asserted an innocent landowner defense and a bona-fide prospective purchaser defense to its liability under CERCLA. Defendant moved for summary judgment, arguing that Redtail Ranch did not complete all appropriate inquiry prior to acquiring the property in 2015 and knew or had reason to know of hazardous waste on the property. The court denied the motion, holding that genuine disputes of material fact existed as to whether an environmental consultant visited and visually inspected areas where there was reason to know hazardous materials may have been disposed, whether the consultant “adequately reviewed local and federal records,” and whether Plaintiff had reason to know of a release or threatened release based on of the information it acquired through is diligence.


2. Necessary and Consistent with NCP

316 Courtland Avenue, LLC v. Frontier Communications Corporation involved cross-motions for summary judgment by plaintiff 316 Courtland Avenue, LLC (Courtland Avenue LLC) and defendants Frontier Communications Corporation (Frontier) and SNET America, Inc. (SNET). SNET and its parent company, Frontier, were former tenants of the 316 Courtland Avenue property. Courtland Avenue LLC alleged that SNET contaminated the property and that Frontier and SNET failed to reimburse Courtland Avenue LLC for its environmental mitigation efforts. In granting SNET’s and Frontier’s motions for summary judgment on Plaintiff’s CERCLA claim, the court found that Courtland Avenue LLC failed to establish that its costs and response conformed to the National Contingency Plan (NCP). Specifically, the court held that the use of a licensed environmental professional to perform remediation activities without independent state investigation did not provide the same protection of public environmental interest as significant government involvement and, therefore, could not effectively substitute for opportunity for public comment as required by the NCP.

In Rio Linda Elverta Community Water District v. United States, Rio Linda Elverta Community Water District and Sacramento Suburban Water District (Plaintiffs) drew drinking water supplies from a local groundwater aquifer. Hexavalent chromium (Cr6) from products used on an Air Force Base had contaminated the aquifer. In addition to state-law tort claims against the United States and Cr6 suppliers, Plaintiffs asserted claims against the United States for imminent and substantial endangerment under the Resource Conservation and Recovery Act (RCRA) and cost recovery under CERCLA. The United States moved to dismiss both claims. Concerning subject matter jurisdiction on the RCRA claim, the court held that the claim represented a challenge to a CERCLA removal action. Therefore, it was barred under section 113 of CERCLA. Concerning the CERCLA claim, the United States argued that the complaint did not sufficiently plead a “release” or “threatened release” that caused the Plaintiffs to incur response costs that were “necessary” and “consistent with the national contingency plan.” The court disagreed. It held the Plaintiffs had sufficiently alleged their costs were necessary because the concentration of Cr6 in their wells posed a health hazard if left untreated. Further, the court held that the question of whether a response action is necessary and consistent with the criteria set forth in the NCP is a factual one to be determined at the damages stage of a section 107(a) action.

3. Statutes of Limitation

Georgia-Pacific Consumer Prods. V. NCR Corp. involved yet another chapter in the remediation of the Kalamazoo River. Defendants International Paper (IP), Weyerhaeuser, and NCR Corporation (NCR) invoked the statute of limitations as an affirmative defense to Georgia-Pacific’s (GP) contribution action. They argued that prior decisions rendered in 1998, 2000, and 2003 confirming the liability of members of the Kalamazoo River Study Group (KRSG), of which GP was one, triggered the three-year limitations period in section 113(g)(3). Section 113(g)(3) provides that the limitations period for a contribution action for response costs runs from “the date of judgment in any action under [CERCLA] for recovery of such costs or damages.” GP first countered by arguing that IP and Weyerhaeuser were not parties in the prior actions, but the court of appeals held that the statutory language did not turn on who the parties were, but on what the prior judgment was for. GP then argued that the declaratory judgment that was rendered in 1998 did not satisfy the text of section 113(g)(3). Relying on the references to “response costs” in section 113(g)(2) and (3), the court of appeals rejected these arguments. The court of appeals explained:

These three italicized references to a judgment for ‘response costs’ strongly suggest that the ‘declaratory judgment on liability for response costs’ mentioned in § 113(g)(2) can also serve as a ‘judgment in any action under this chapter for recovery of such costs or damages’ causing the statute of limitations to begin to run, as described in § 113(g)(3)(A).

The KRSG decision issued in 1998 compelled GP as a member of KRSG to pay for “‘the entire cost of response activities relating to the NPL site,’ i.e., PCB cleanups on this stretch of the Kalamazoo River.” While GP “did not yet have a bill in hand for response costs or damages,” GP “had received the responsibility to pay for ‘as-yet-unfinished’ remedial work.” As a result, the 1998 declaratory judgment on liability “started the contribution clock ticking.” GP did win on one issue—sort of. It was allowed to bring a section 107(a) cost recovery claim for costs not embraced by the 1998 judgment. In so ruling, the court of appeals added that the 1998 KRSG judgment had a broad scope, covering "the costs of response activities for the NPL Site." Thus, “GP may bring § 107(a) claims for costs that fall outside of that judgment, but the judgment's breadth suggests that identifying such costs will prove difficult in practice.”

Following General Motors’ (GM) declaration of bankruptcy, EPA, New York and Saint Regis Mohawk Tribe entered a consent decree in 2011, with GM creating the Revitalizing Auto Communities Environmental Trust (RACER) and setting aside funds to remediate the area polluted by GM’s car part manufacturing plant on the Onondaga Lake near Syracuse, New York. In 2018, Racer sued numerous companies to recover response costs in cleaning up the area. However, the court in Racer Properties LLC v. National Grid USA dismissed Racer’s second amended complaint as time barred. Despite Racer’s contentions that it was not obligated to clean up certain sediments, surface water, and floodplains designated as OU-2 or areas of land outside the bounds of OU-2, the court held that the 2011 consent decree resolved Racer’s CERCLA liability for OU-2 and the expanded territory. As a result, Racer was limited to a section 113(f) contribution claim, which was dismissed as time barred, having been filed in 2018. To reach this conclusion, the court looked to the “matters addressed” section of the 2011 Agreement, the reservation of rights limiting the government’s covenant not to sue to matters expressly specified, and the incorporated-by-reference bankruptcy proofs of claim to conclude that the consent decree covered operable units other than just the GM plant (OU-2 and the expanded territory) for which Racer resolved its liability and received a covenant not to sue. The court also found that a subsequent Record of Decision and 2021 consent decree did not restart the limitations period where liability for the area in question had already been satisfied in the 2011 Agreement.

4. Other Defenses and Challenges

In City of Las Cruces v. Lofts at Alameda, LLC, the City of Las Cruces and Dona Ana County (Plaintiffs) moved to dismiss defendant American Linen counterclaims and third-party claims, and to strike American Linen’s affirmative defenses to CERCLA liability. Concerning American Linen’s affirmative defenses, some of which were equitable in nature and non-statutory, the court agreed with Plaintiffs that CERCLA permits only enumerated statutory defenses to liability. However, the court also stated, “[i]t is not unusual for defendants to plead defenses that pertain to damages as well as those applicable to liability.” Thus, the court denied Plaintiffs’ motion to strike the affirmative defenses. The court explained that Plaintiffs were not prejudiced because the defenses required no response from Plaintiffs, and admonished that American Linen cannot use the non-statutory defenses to avoid liability.

G. Recoverable Response Costs (Including Attorney’s Fees)

In Crescent Mine, LLC v. Bunker Hill Mining Corporation, the court dismissed Plaintiff’s cost recovery and declaratory judgment claims with leave to amend, finding that its allegation that it incurred response costs was a “prototypical example of a conclusory allegation” and did not provide details of any actions taken to incur response costs. Plaintiff’s claim for declaratory judgment was then also dismissed because there was no substantive claim on which to base the claim.

The court in Ohio v. Breen held that the State’s (1) direct costs for investigation, evaluation, and monitoring of an extermination facility that mixed, stored, transferred pesticides and loaded, unloaded, and washed trucks containing pesticides, as well as (2) its administrative costs, such as travel and coordination with private consultants, and (3) time billed for enforcement related tasks were all “part and parcel” of the State’s efforts to remediate the facility and were, therefore, CERCLA “response costs.” The court further held that the Breen’s arguments challenging the State’s eligibility to recover response costs because they related to the State’s claim for injunctive relief lacked merit. Finally, the court held that, despite the State’s order requiring payment of oversight and response costs in connection with the site after receipt of an accounting of such costs, the State did not waive its rights to seek such costs by not issuing a formal demand because of the reservation of rights provision in the order and because a formal demand for payment is not a pre-requisite for recovery of response costs under CERCLA 107(a).

In Stratus Redtail Ranch LLC, v. International Business Machines Corporation, the court denied a motion in limine to exclude evidence of costs in a § 113(f)(3)(B) contribution claim. It held that under the Supreme Court’s decision in Territory of Guam v. United States, a party may seek contribution under § 113(f)(3)(B) after a settlement resolving CERCLA-specific liability. Here, costs were incurred under a Compliance Order on Consent with the state under the state’s solid waste act, but there was a prior administrative settlement with EPA resolving CERCLA liability that contemplated the costs and triggered the right to contribution.

Regents of the Univ. of Minnesota v. United States involved competing cost recovery claims arising out of investigations into releases of hazardous substances at the Gopher Ordinance Works (GOW), a World War II ordinance facility. Plaintiff sought $3,361,215.61 incurred to perform initial investigations at the facility. The United States unsuccessfully argued that these costs were not consistent with the National Contingency Plan (NCP). “Because the detailed NCP provisions governing other response action cannot reasonably be applied to preliminary monitoring and evaluation of a release of hazardous substances, the University's costs are recoverable irrespective of their consistency with the NCP.” The United States’ argument that the University’s costs did not satisfy the “accurate accounting” requirement of the NCP also failed, given that the University submitted an employee affidavit attaching contracts, detailed invoices for costs and evidence of payment related to the RI studies, which was “more than adequate to comply with the NCP.” The court also rejected the United States’ arguments challenging recoverability of the legal fees sought by the University, explaining that attorney's fees were recoverable if they were incurred to “‘significantly benefit[] the entire cleanup effort.’”

The United States also argued that because the University withheld some documents (draft reports and communications between environmental contractors and attorneys) on the basis of work product, the related legal fees were not recoverable. The court again disagreed, stating that “[d]efendants’ argument improperly conflates the issue of work product privilege for documents prepared in anticipation of litigation and the question of whether work can both support litigation and also be ‘closely tied to the actual cleanup’ and ‘served a statutory purpose apart from the reallocation of costs.’” Conversely, the court rejected the Government’s claim for $779,927.27 for internal costs of the Army Corps of Engineers, $812,276.45 in contractor costs, and $90,249.40 in attorneys’ fees because they “were not incurred ‘in response’ to the release of hazardous substances at the Site, as required for cost recovery under CERCLA,[…] but rather, to justify not taking actions under FUDS [(Formerly Used Defense Sites)] Policy in response to the release.” In addition, the Government’s internal costs were not supported by competent evidence and were facially inconsistent with the NCP given that they lacked specificity and were based almost entirely on an ad hoc review that was conducted many years after the fact. As for attorneys’ fees, the court held the United States was not entitled to fees for prosecuting its claim because the United States was not acting as the enforcement arm of the Government.

Natural Resource Damages

To provide adequate factual context, some court holdings with respect to natural resource damages are discussed above in connection with related holdings.

In related opinions, the district court in Pakootas v. Teck Cominco Metals, Ltd. denied motions for partial summary judgment, holding that (1) preferred hunting and fishing rights and paramount use rights were sufficient to establish an Indian tribe’s standing to seek natural resource damages, and (2) where a remedial action is being evaluated under a Remedial Investigation and Feasibility Study (RI/FS), the remedial action is “otherwise scheduled” such that the applicable statute of limitations for natural resource damage claims is three years after completion of the remedial action pursuant to § 9613(g)(1).

In Seggos v. Datre, Defendants moved for partial summary judgment on the grounds that the Plaintiff’s CERCLA natural resource damages claims were barred by the statute of limitations. The court denied the motion, holding that the knowledge of the county district attorney jointly investigating the dumping of construction and debris material from New York City into a park with the New York State Department of Conservation could not be imputed to the State, and genuine issues of material fact existed as to when the State knew or should have known about the presence of hazardous substances in the park.

Amanda Kesler and Van Hilderbrand, Miles & Stockbridge, P.C. Washington, D.C.; John Barkett, Shook Hardy & Bacon, LLP Miami, FL. This chapter reviews significant 2022 CERCLA decisions and developments. The views expressed are the authors own and not necessarily those of their firms or clients.