By RITA CICERO
Andrews Publications Staff Writer
Findlaw
EPA – September 22, 2006
A split 3rd Circuit has ruled that chemical giant DuPont Co., which voluntarily cleaned up several contaminated sites, cannot seek contribution from the federal government under the Superfund law, even though the government allegedly was also a polluter at the sites.
The panel ruled 2-1 that under precedent in the 3rd Circuit, DuPont cannot recover cleanup costs under Section 107 of the federal Superfund law because it is a liable party, and Section 107 enables only innocent parties to recover cleanup costs.
Dissenting, Circuit Judge Dolores Sloviter said the majority’s ruling would discourage voluntary cleanups.
“Spills that could be most efficaciously dealt with if cleaned up immediately will remain untouched while parties attempt to settle with the government,” she said.
The U.S. Court of Appeals for the 3rd Circuit’s ruling creates a split among circuits, since the 2nd and 8th Circuits, the only other federal appeals courts to rule on the subject, both have found an implied right of contribution under Section 107.
DuPont filed suit against the government in 1997 in the U.S. District Court for the District of New Jersey, seeking contribution for costs the company incurred cleaning up 15 sites in several states.
The sites were contaminated with hazardous waste, including neoprene, calcium carbide, butadiene, chlorobutadiene and monovinylacetylene, according to the government.
The United States owned or operated the sites during World Wars I and II, and reportedly contributed to the contamination. DuPont voluntarily cleaned up the sites.
The lawsuit was filed under Section 113 of the Comprehensive Environmental Response, Compensation and Liability Act, commonly known as the Superfund law. Section 113 allows liable parties to sue other liable parties for contribution costs only if the petitioner has been sued by a state or the federal government.
The District Court granted summary judgment to the United States, ruling that a potentially responsible party that voluntarily cleans up a site cannot assert a Section 113 contribution claim.
DuPont appealed the ruling to the 3rd Circuit, citing a recent landmark U.S. Supreme Court decision on the Superfund law.
In Cooper Industries Inc. v. Aviall Services Inc., 543 U.S. 157 (2004), the high court said a liable party who voluntarily cleans up a contaminated site cannot bring a contribution action under Section 113 to recover cleanup costs. The Supreme Court did not rule on the applicability of Section 107 in such cases.
Section 107 allows the government and innocent parties who owned but did not contribute to a site’s contamination to recover cleanup costs from liable parties.
In a Section 113 contribution action, a party found liable for some of the pollution at a site may seek to recover cleanup costs from other parties that may also be responsible for a portion of the cleanup costs.
However, the liable party must first resolve its legal responsibility in an administrative or judicially approved settlement with the state or federal government.
Section 107 makes potentially liable parties jointly and severally liable for all cleanup costs incurred by the government at a hazardous-waste site. Before Section 113 was enacted in 1986, courts found an implied right under Section 107 for liable parties to seek contribution from other liable parties.
DuPont asked the 3rd Circuit to reconsider two of its opinions and allow the company to sue for contribution under Section 107; New Castle County v. Halliburton NUS Corp., 111 F.3d 1116 (3d Cir. 1997), and In re Reading Co., 115 F.3d 1111 (3d Cir. 1997).
The two 3rd Circuit cases, which were decided before Cooper, held that a cost-recovery action brought under Section 107 was limited to “innocent” parties that had undertaken cleanups. Liable parties were limited to Section 113 contribution actions, according to the opinions in the two cases.
After the Supreme Court’s Cooper ruling, Section 113 was not available to DuPont, as the company had voluntarily cleaned up the sites.
The 3rd Circuit majority refused to re-evaluate its precedent concerning the unavailability of Section 107 for those who voluntarily clean up polluted sites in light of Cooper, determining that nothing in its two previous opinions depended on the motivations for the cleanups.
“It is familiar law that when the rule in a prior case by its terms controls the outcome of a current case, we will not reach out to distinguish the prior case on the basis of factual differences that were not material to the earlier holding,” the appeals panel said.
The panel noted that it was not “unsympathetic to the policy arguments” DuPont made, but nothing in its ruling forces companies “to sit on contaminated sites and wait to be sued.”
The 3rd Circuit therefore affirmed the District Court’s ruling.
