Newsletter
May 7, 2009
Supreme Court Clarifies CERCLA Liability
On May 4, 2009, the United States Supreme Court issued a significant decision construing liability under the Comprehensive Environmental Response, Compensation and Liability Act, known as “CERCLA” or “Superfund.”1 The text of the Burlington Northern & Santa Fe Railway Co., et al. v. United States (“ BNSF”) decision is available at http://www.supremecourtus.gov/opinions/08pdf/07-1601.pdf.
Joint and Several Liability and Divisibility of Harm
The Court upheld the district court’s refusal to apply joint and several liability against the defendants, including the Railroad, regarding the Government’s claim for recovery of its costs incurred in remediating a contaminated site. Although waste was commingled, the district court concluded that the harm was divisible. The district court had concluded, and the Supreme Court agreed, that there was a reasonable basis to apportion liability based on geography (relative ownership or operation of discrete parcels that together formed one “site” or “facility” needing remediation) and on a temporal basis (relative years of ownership or operation as between defendants). Up to this point, few CERCLA defendants have successfully convinced a trial court that harm at a CERCLA site was divisible.
“Arranger Liability”
In addition to owners, operators, former owners and former operators of facilities where hazardous substances are being released, CERCLA’s broad net of liability includes persons commonly understood to have “generated” the hazardous substances disposed of at a site. The exact language of the statute is “any person who by contract, agreement or otherwise arranged for disposal … or arranged with a transporter for transport for disposal … of hazardous substances.” Despite CERCLA having been enacted nearly thirty years ago, the contours of “arranger liability” remained somewhat undefined (and will continue as such notwithstanding this decision). In BNSF, the defendant sold pesticides to a company whose property ultimately was contaminated by frequent spills of pesticides occurring during unloading of the pesticides from a common carrier to the company. The defendent knew that these spills were taking place but continued nonetheless to sell product to the company. The Government argued that knowledge plus continued participation in the delivery of the product, given that spills were inherent in the process, was sufficient for “arranged for” liability. The Supreme Court disagreed. While noting that “arranged for” liability entails a fact-intensive inquiry, the Court concluded that the record did not establish the requisite “intent” to dispose. It was not enough that spills were foreseeable, perhaps even an inevitable byproduct of the sale of a useful product. While acknowledging that knowledge can evidence an intent, intent does not arise simply where “disposal occurs as a peripheral result from the legitimate sale of an unused, useful product.”
For more information, please contact the Seyfarth attorney with whom you work, or any Environmental, Safety & Toxic Torts attorney on our website.
142 O.K. §9601 et seq.