Posted on October 26, 2011 by William Session
In Morrison Enterprises, LLC v. Dravo Corporation, the Eighth Circuit held that a party who has incurred costs responding to a contaminant it did not release into the environment [Morrison], is limited to recovery of such costs pursuant to Section 113(f) CERCLA. The Eighth Circuit so held because Morrison incurred its response costs pursuant to an administrative or judicially approved settlement under §§106 or 107concluding that the payment of these costs were “compelled”. More specifically, because Morrison’s response costs were incurred implementing a remedy pursuant to an Administrative Order on Consent (and a subsequent judicial order), the Eighth Circuit concluded that it was of no consequence that Morrison never released the contaminants in question nor owned or operated the facility where the contamination originated. The Eighth Circuit said that despite the acknowledged fact that Morrison was remediating a contaminants released by another party at a separate and distinct facility, any effort to recoup its response costs were limited to a CERCLA §113(f) contribution action.
The Eighth Circuit noted that the Supreme Court in United States v. Atlantic Research had specifically reserved the precise issue presented by Morrison’s appeal, i.e., whether a party sustaining expenses pursuant to a consent decree following a suit under §§106 or 107(a) could recover such compelled costs under §107(a), §113(f), or both. The Eighth Circuit held that §113(f) provides the exclusive remedy for a party in this procedural situation. Morrison disagreed with the Eighth Circuit’s holding and has filed a Cert Petition on the issue reserved by the Supreme Court in Atlantic Research.
The Cert Petition points out that the issue of whether compelled costs are recoverable under §107(a) or §113(f) has vexed the lower courts, resulting in confusion and a split of authority amongst the circuits. The Cert Petition also makes the argument that the plain language of CERCLA permits a §107 claim to recover compelled costs given the absence of a single word or provision in CERCLA §107(a) limiting cost recovery claims to only those costs which are “voluntarily” incurred.
Amici Curiae Pharmacia Corporation (f/k/a/ Monsanto Company) and Solutia Inc., filed a brief in support of Morrison’s Cert Petition. The Amicus Brief points out that the Eighth Circuit’s holding in Morrison ignores the text of CERCLA and directly contradicts the Supreme Court’s holdings in Aviall and Atlantic Research, where the Supreme Court made it clear that courts must follow the language in the statute. The Amicus Brief also discusses how the Eighth Circuit’s opinion conflicts with one of the principal goals of CERCLA: encouraging private party cleanups. One of the most significant incentives for a private party to step forward and work with the government to investigate a site and conduct a cleanup is the right to pursue other parties to recover its costs. Limiting such a party to contribution under §113(f) significantly weakens that incentive because the government can (and will) unilaterally settle with recalcitrant parties to protect them from the performing party’s contribution claim.