Section 107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. § 9607(a)(3), imposes liability for the response and cost of cleaning up environmental contamination by hazardous substances on four classes of potentially responsible parties (PRPs), including “arrangers.” 42 U.S.C. § 9607(a). CERCLA defines an “arranger” as “any person who . . . arranged for disposal . . . or arranged with a transport for transport for disposal . . . of hazardous substances.” 42 U.S.C. § 9607(a)(3).
In Burlington Northern & Santa Fe Railway Co. v. United States, 556 U.S. 599 (2009), the Supreme Court explained what it means to “arrange for disposal.” In short, a party must “take intentional steps to dispose of a hazardous substance” to be liable as an arranger. The Court also provided guidance on the type of evidence that could satisfy the intent element for purposes of arranger liability. For example, a party’s knowledge that its product will be spilled by others may constitute evidence of that party’s intent to dispose, but knowledge, without more, is insufficient to prove the necessary mens rea. Moreover, “CERCLA liability would attach . . . if an entity were to enter into a transaction for the sole purpose of discarding a used and no longer useful hazardous substance,” but “an entity could not be held liable as an arranger merely for selling a new and useful product if the purchaser of that product later, and unbeknownst to the seller, disposed of the product in a way that led to contamination.” Most cases fall between the latter two extremes and demand a fact-intensive inquiry.
Several federal circuit courts of appeals have applied the dictates of Burlington Northern in addressing transactions falling between the two extremes in cases of putative arranger liability under CERCLA. Those cases confirm that the requisite intent for arranger liability is difficult to define precisely and requires a case-specific, highly factual analysis. The case law also shows that the intent element is quite difficult to prove. This article summarizes the post-Burlington Northern circuit court cases.