Superfund: 20+20 = 40

Posted on January 14, 2020 by John Barkett

It seems hard to believe that the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)—affectionately known as the Superfund law—will be forty-years old in December 2020.

I first became involved with CERCLA in 1981, a few months after the law’s adoption. The State of Florida’s environmental regulatory agency was concerned about a transformer salvaging operation. It feared that mineral oil containing polychlorinated biphenyls that had been spilled on the ground would be carried throughout the surrounding area if a hurricane hit Miami and caused severe flooding. So it called on the Environmental Protection Agency to conduct a removal action – an emergency response – under CERCLA. That led to a lawsuit to gain access.  I represented a utility that had sold transformers to the salvager. A federal district court judge set a hearing on EPA’s motion for a preliminary injunction to gain access and allowed two weeks for discovery.  The judge also ordered the utility to intervene in the action.  We were taking depositions around the clock until the judge called us into chambers just before the hearing was scheduled to begin. We left chambers and headed not to the courtroom but to a hotel where we were ordered to engage in settlement discussions and not to return until a settlement had been reached.  The settlement was reached.  No hurricane hit.  The site was eventually remediated.  And acronyms like RI/FS, RD/RA, PRP, and NPL became a part of my daily vocabulary.

This case, however, was not the norm.  Once Chem-Dyne came down establishing the principle that in a government cost recovery action, the Superfund law created joint and several liability, and other cases affirmed EPA’s position that liability was also strict and retroactive, the litigation floodgates opened.  To conserve enforcement resources, EPA (the United States) sued “deep pocket” parties. Those parties then sued other PRPs who sued other PRPs—waves of multi-party actions.  The calls to members of Congress became louder as pizza parlors were spending more money on lawyers for the hazardous substances in the ink on their pizza boxes than they could make on a calzone.

Reforms eventually followed in the next two decades of Superfund.  The Superfund Amendments and Reauthorization Act (SARA) in 1986 plugged some holes in the statute and expressly provided for contribution actions.  The “innocent landowner” defense was added and literally created an industry – environmental assessment firms sprung up over night offering their services to anyone buying land or lending money for a real estate acquisition. 

Other amendments followed.  Section 107 of CERCLA initially ended in subparagraph (m).  Now there is a subparagraph (n) to protect fiduciaries, (o) to protect “de micromis” parties, (p) to create a municipal solid waste exception, (q) to address contiguous properties, and (r) to address prospective purchasers.   The Superfund Recycling Equity Act was passed in 1999 to reverse decisions of courts which found that a person recycling certain products was an arranger for disposal liable under Section 107(a)(3) of CERCLA.

Landfills, used oil recyclers, and solvent recyclers received most of the attention in the first three decades of Superfund—and in many cases are still receiving attention.    In the fourth decade of Superfund, river sediment sites have been the most prominent sites on the National Priorities List.  Their remedial investigation/feasibility study and remedial design/remedial action costs dwarf those of landfills on the NPL.

The Supreme Court has weighed in on the Superfund law on a few occasions. Key Tronic wounded the private Superfund enforcement business when the Court in 1994 determined that a private Superfund plaintiff could not recover litigation attorneys’ fees under CERCLA. Aviall (2004), Atlantic Research (2007), and Burlington Northern (2009) followed in a string of decisions that shook up the Superfund jurisprudence in the arena of contribution actions, cost recovery actions, and the evidence required to establish when someone has arranged for disposal or treatment of a hazardous substance. Burlington Northern also weighed in on how to prove a reasonable basis for apportionment in a cost recovery action.

A lot of money has been spent on Superfund sites these past 39 years.  Whether the risk reduction bought with those dollars was the best use of these funds can be debated.  But there is no debate that toxicology has risen in prominence because of Superfund and lawyers have had to become familiar with notations or phrases like 1 x 106, slope factor, and reference dose, to make sense of the difference between carcinogenic and non-carcinogenic risks in human health risk assessments.

All Superfund lawyers know Section 113(f)(1) of CERCLA, the statutory standard applicable in a contribution action: the court is to allocate response costs according to “such equitable factors as the court determines are appropriate.”  That text has resulted in the “Gore factors,” the “Torres factors,” and a host of arguments – sometimes supported by facts and oftentimes supported by inferences or even educated guesswork – as judges and allocators attempt to satisfy the statutory standard.

As we embark on a fifth decade of Superfund, we have another Superfund Task Force and a new set of recommendations focused on trying to speed up cleanups, accelerate remedial design, encourage private investment resulting in reuse of Superfund sites, promote redevelopment of sites to revitalize communities, and promote transparency and engagement with Superfund stakeholders. Actions always speak louder than words, so we can all just watch and hope that the noble goals of this latest Superfund Task Force can be met.

So, here’s to a “Happy 40th” to the Superfund law in 2020.  I was there for your birth and am glad to still be around to declare: you have definitely aged, but you still seem to be going strong!

The 11th Circuit Weighs in on the CERCLA §107 vs. §113 Debate

Posted on May 14, 2012 by Jarred Taylor

The ACOEL blog has devoted several entries over the last two years to the question whether and how a plaintiff could recover, under CERCLA, costs it incurred for a cleanup performed under a consent decree or administrative settlement.  One of the more intriguing developments for CERCLA practitioners has been the tension between and radical differences to cost recovery or contribution claims under Sections 107 and 113 of CERCLA.  One of the more recent developments is the 11th Circuit decision in Solutia v. McWane (Full disclosure: I am counsel to several defendants in this case). 

"Boots" Gale previously blogged about the District Court decision. The District Court dismissed Plaintiffs’ Section 113 claim on the basis that these Defendants had the benefit of CERCLA’s contribution protection obtained via their own administrative settlement with EPA.  Initially, the District Court denied summary judgment on Plaintiffs’ Section 107 claim, but then reconsidered and reversed that decision. 

The 11th Circuit noted that the Supreme Court's Atlantic Research decision declined to decide the issue of whether a party may bring a 107(a) claim for direct cleanup costs incurred via a consent decree entered as past of CERCLA Section 106/107  litigation.  The 11th Circuit confirmed, however, the conclusion of the District Court that numerous federal Circuit Courts had reached that issue since that time, each one concluding Section 113 to be the party’s exclusive remedy, and denying the Section 107 claim.  Relying in part on the conclusions reached by these other Circuit Courts, the 11th Circuit rejected Plaintiffs’ statutory interpretation arguments, and concluded that a party who has a CERCLA Section 113(f) claim cannot also maintain a CERCLA Section 107 claim.  To find otherwise, the 11th Circuit concluded, would “thwart the contribution protection afforded to parties that settle their liability with the EPA…”, “destroy CERCLA’s statutorily-created settlement initiative…”, would allow a plaintiff to impose joint and several liability on defendants, and would prevent those defendants from asserting any Section 113(f) counterclaim since the plaintiffs would have their own CERCLA contribution protection via their consent decree. 

The time has not run yet for the Plaintiffs in this case to seek certiorari from the Supreme Court.  In light of the unanimity of the federal Circuit Courts on this issue, it seems unlikely that the Court would accept the case for decision, despite the importance of the issue and the Court’s decision not to reach the issue in its 2007 decision in Atlantic Research.