Business 8th Edition by Marianne Jennings

Exercise 27

Swimming in Sludge and Maybe Liability
Facts
Sullivan's Ledge, once a popular swimming, hiking, and impromptu gathering area located near New Bedford, Massachusetts, has become little more than an industrial dumping ground for scrap rubber, waste oils, gas, combustion ash, and old telephone poles. The sludge became so toxic, the refuse so thick, and the stench so overwhelming, that the city closed down the area in the 1970s.
The EPA eventually identified a number of business entities and their successors as responsible for the cleanup of the area. Following lengthy negotiations, those businesses entered into a consent decree in 1992 that required them to implement a remediation plan and shoulder the costs of that plan for returning Sullivan's Ledge to a nonhazardous site.
Following the agreement, Acushnet Company and others in the consent decree group (plaintiffs) filed suit seeking financial contribution from Mohasco Corporation and others including American Flexible Conduit (AFC), New England Telephone Telegraph Company (NETT), and Ottaway Newspapers; Inc. (defendants. appellees).
The trial court found that there was insufficient evidence to find these companies liable under CERCLA and granted them summary judgment. The Sullivan's Ledge Group (another name for the plaintiffs seeking indemnification for the clean-up) appealed.
Judicial Opinion
BOWNES, Senior Circuit Judge.
CERCLA, as we have said on other occasions, sketches the contours of a strict liability regime. Broad categories of persons are swept within its ambit, including the current owner and operator of a vessel or facility; the owner or operator of a facility at the time hazardous waste was disposed of; any person who arranged for the transportation of hazardous substances for disposal or treatment; and anyone who accepted hazardous waste for transportation. There are a few affirmative defenses available, but they are generally difficult to satisfy (they include showing that the release or threat of release was caused solely by an act of God or an act of war). By and large, a person who falls within one of the four categories defined in 42 U.S.C. §9607(a) is exposed to CERCLA liability.
While CERCLA casts the widest possible net over responsible parties, there are some limits to its reach. The courts of appeals have generally recognized that "although joint and several liability is commonly imposed in CERCLA cases, it is not mandatory in all such cases"
The Sullivan's Ledge Group mounts a three-fold attack on the district court's reasoning in resolving the respective motions. Its arguments on appeal are broad-brushed in nature, focusing almost entirely on the legal meaning of "causation" and CERCLA's underlying policy goals. First, plaintiffs insist that reading any causal element into CERCLA is inconsistent with the principle of strict liability. Second, they contend that doing so would run counter to the remedial purpose of CERCLA because, among other things, it will let smaller polluters off the hook and discourage responsible parties from entering into consent agreements with the government. Third, to the extent the district court may have considered equitable factors in ruling in favor of Mohasco, Ottaway, and AFC, plaintiffs claim that the court did so without providing a "full and fair allocation trial."
Defendants-appellees, for their part, contend that it makes sense to say that a de minimis polluter has not caused a responsible party to incur clean up costs; and that, in all events, plaintiffs' contribution claims against them founder for a more fundamental reason: the record did not permit a finding that each should bear a meaningful share of the costs associated with restoring Sullivan's Ledge. In their view, these fatal weaknesses in the plaintiffs' case justified judgment as a matter of law in their favor.
We have strong reservations about interpreting the statute's causation element to require that a defendant be responsible for a minimum quantity of hazardous waste before liability may be imposed. The text of the statute does not support such a construction-CERCLA itself does not expressly distinguish between releases (or threats of releases) by the quantity of hazardous waste attributable to a particular party. At least on its face; any reasonable danger of release, however insignificant, would seem to give rise to liability. On this point the courts of appeals are in unison.
To read a quantitative threshold into the language "causes the incurrence of response costs" would cast the plaintiff in the impossible role of tracing chemical waste to particular sources in particular amounts, a task that is often technologically infeasible due to the fluctuating quantity and varied nature of the pollution at a site over the course of many years.
Moreover, it would be extremely difficult, if not impossible, to articulate a workable numerical threshold in defining causation. How low would a polluter's contribution to the mix have to be before a judge could find, with equanimity, that the polluter was not a but-for "cause" of the clean up efforts? Less than 0.5 percent or 1 percent? We do not see how much a line, based on the quantity or concentration of the hazardous substance at issue, can be drawn on a principled basis in defining causation. To even begin down that path, we feel, is to invite endless confusion.
This does not mean, however, that the de minimis polluter must necessarily be held liable for all response costs. The approach taken by the second Circuit is instructive. The Second Circuit reaffirmed the Restatement (Second) of Torts approach to fleshing out the scope of CERCLA liability, holding that where environmental harms are divisible, a defendant may be held responsible only for his proportional share of the response costs. In extending the principle a half-step, the Second Circuit went on to say that:
[A defendant] may escape any liability for response costs if it either succeeds in proving that its [waste] , when mixed with other hazardous wastes , did not contribute to the release and cleanup that followed , or contributed at most to only a divisible portion of the harm.
We therefore hold that a defendant may avoid joint and several liability for response costs in a contribution action under §9613(f) if it demonstrates that its share of hazardous waste deposited at the site constitutes no more than background amounts of such substances i in the environment and cannot concentrate with other wastes to produce higher amounts. This rule is not based on CERCLA's causation requirement, but is logically derived from [the statute's] express authorization that a court take equity into account when fixing each defendant's fair share of response casts. We caution, however, that not every de minimis polluter will elude liability in this way. As always, an equitable determination must be justified by the record.
There is nothing to suggest that Congress intended to impose far-reaching liability on every party who is responsible for only trace levels of waste. Several courts, albeit taking different paths to a similar result, have rejected the notion that CERCLA liability "attaches upon release of any quantity of a hazardous substance"
Allowing a CERCLA defendant to prevail on issues of fair apportionment even at the summary judgment stage, is consistent with Congress's intent that joint and several liability not be imposed mechanically in all cases. Permitting a result that is tantamount to a no-liability finding, is in keeping with the legislative goal that clean up efforts begin in a speedy fashion and that litigation over the details of actual responsibility follow. In fact, to require an inconsequential polluter to litigate until the bitter end, we believe, would run counter to Congress's mandate that CERCLA actions be resolved as fairly and efficiently as possible. On the whole, the costs and inherent unfairness in saddling a party who has contributed only trace amounts of hazardous waste with joint and several liability for all costs incurred outweigh the public interest in requiring full contribution from de minimis polluters.
The ultimate failure of a contribution claim because someone did only a negligible amount of harm does not impede enforcement by the EPA or frustrate any of CERCLA's objectives.
Affirmed.
Will the decision excusing companies from cleanup costs defeat the purposes of CERCLA?