30 F.3d 761 (7th Cir. 1994), 92-3820, Akzo Coatings, Inc. v. Aigner Corp.

Docket Nº:92-3820.
Citation:30 F.3d 761
Party Name:AKZO COATINGS, INCORPORATED, and The O'Brien Corporation, Plaintiffs-Appellants, v. AIGNER CORP., et al., Defendants-Appellees.
Case Date:July 11, 1994
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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Page 761

30 F.3d 761 (7th Cir. 1994)

AKZO COATINGS, INCORPORATED, and The O'Brien Corporation,

Plaintiffs-Appellants,

v.

AIGNER CORP., et al., Defendants-Appellees.

No. 92-3820.

United States Court of Appeals, Seventh Circuit

July 11, 1994

Argued May 5, 1993.

Rehearing and Suggestion for Rehearing En Banc Denied Aug. 12, 1994.[*]

Page 762

Timothy W. Woods, Jones, Obenchain, Ford, Pankow & Lewis, South Bend, IN, Timothy L. Harker, Colleen M. Morgan, Gary R. Letcher (argued), David J. Kaufman, Washington, DC, for Akzo Coatings, Inc. and O'Brien Corp.

Bradley D. Jackson, Foley & Lardner, Madison, WI, Pierre C. Talbert (argued), Robert Dupuy, Foley & Lardner, Chicago, IL, for Aigner Corp., American Can Co., Dexter Corp., Duplicolor Products Co., Graham Paint & Varnish Co., Inc., Illinois Bronze Paint Co., Motorola, Inc., Prefinish Metals, Inc., Reynolds Metals Co., S & E Elec. Co., Sherwin Williams Co., Valspar, Inc., Whittaker Corp. and Morton Intern. Inc.

Richard W. Paulen, Barnes & Thornburg, Elkhart, IN, Pierre C. Talbert, Robert Dupuy, Toley & Lardner, Chicago, IL, for Rollcoater.

Catherine R. McCabe, Anne S. Almy, Dept. of Justice, Environmental Defense Section, Washington, DC, for U.S. amicus curiae.

Before EASTERBROOK and ROVNER, Circuit Judges, and WILLIAMS, District Judge. [**]

ILANA DIAMOND ROVNER, Circuit Judge.

After completing the emergency clean-up work they were ordered to perform at a hazardous waste site in Indiana, Akzo Coatings, Incorporated and The O'Brien Corporation (collectively, "Akzo") brought suit for contribution against Aigner Corporation and a number of other companies (collectively, "Aigner") that allegedly had generated wastes which had been treated or disposed of at that site. The district court granted summary judgment in favor of Aigner, finding that Akzo's work was a "matter addressed" by the consent decree that Aigner had entered into with the government. See 42 U.S.C. Sec. 9613(f)(2). Because we conclude that Akzo's work was for the most part not a "matter addressed" by the consent decree, we reverse the district court's judgment in part.

I. FACTS

Between 1972 and 1985, more than 200 firms generated hazardous wastes that were sent to various facilities within the Kingsbury Industrial Park in Kingsbury, Indiana comprising what we refer to as the "Fisher-Calo" site. Among these facilities was the "Two-Line Road" facility, where Fisher-Calo Chemicals and Solvents, Incorporated and its predecessor corporations had conducted solvent recycling operations from 1981 until 1985.

In 1988, the federal Environmental Protection Agency ("EPA") concluded that the wastes stored at the Two-Line Road facility posed an imminent danger of release into the surrounding environment. Exercising the authority granted under section 106 of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Sec. 9606, the EPA issued a unilateral administrative order requiring Akzo and some twenty other companies that qualified as "liable persons" under CERCLA 1 to conduct certain "emergency removal activities" at the Two-Line Road facility. Among the tasks required were: (1) fencing off and otherwise securing the facility; (2) securing and removing all drums, tanks, and other containers of hazardous waste from the premises, including buried containers; and (3) determining the extent to which the soil was contaminated and removing any soil that was visibly polluted. Akzo complied with the EPA's order, incurring

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costs in excess of $1.2 million. 2 The work specified by the EPA's 1988 order has largely been completed. 3

In May 1990, approximately thirty-five companies that had generated wastes disposed of at the Fisher-Calo site and were thus "potentially responsible parties" ("PRPs") under CERCLA (see n. 1, supra ) initiated efforts to quantify the nature and extent of the liability of any and all PRPs for clean-up of the site and to evaluate the types of work that the EPA and Indiana might order them to perform. Akzo was among the firms that engaged in this effort, and it incurred further costs in doing so. However, Akzo withdrew from the group in February 1991 after concluding that it was not liable for any contamination of the Fisher-Calo site beyond the Two-Line Road facility.

In August 1990, the EPA published a Record of Decision ("ROD") outlining the work it believed necessary to accomplish a complete decontamination of the site. With respect to the work mandated by the 1988 Order, the ROD stated:

A removal action at the north end of the Two-Line facility is being conducted under a Unilateral Removal Order issued by U.S. EPA. The removal action is being carried out in two phases: Phase I involves the staging of drums for removal during Phase II. Phase II includes the excavation of the contaminated soils and buried tanks and drums located on the north end of the Two-Line Road property. The visibly contaminated soils, tanks and drums will be removed from the north end of the Two-Line Road facility and transported to an appropriate disposal facility. A further removal action is being scoped for the south end of the Two-Line facility. For the purposes of this Record of Decision, it is assumed that all drums, tanks, and containers on the Two-Line Road property requiring remedial action are being addressed by these actions.

ROD Summary at 5 (emphasis supplied). The EPA began to negotiate with the PRPs to implement the clean-up outlined in the ROD, and by the end of the following year, it had finalized an agreement with more than 200 PRPs. The EPA filed suit against these PRPs in late December 1991 and asked the court to approve the proposed consent decree it filed contemporaneously with its complaint. United States v. Accurate Partitions Corp., Civ. No. S91-00646 M (N.D.Ind.). Pursuant to the decree, the settling PRPs agreed to undertake the actions specified by the 1990 ROD and to compensate the EPA for some of the costs it had incurred to date. In late February 1992, following the requisite notice period, see 42 U.S.C. Sec. 9622(d)(2), the district court approved the consent decree. Aigner was a party to this decree; Akzo was not.

In 1991, Akzo brought suit against Aigner seeking, inter alia, contribution under CERCLA for the initial clean-up work it had performed at the behest of the EPA as well as the voluntary costs it had incurred in studying the long term clean-up of the site with other PRPs. 4 Aigner moved to dismiss the complaint, arguing that the work for which Akzo sought contribution was a "matter addressed" by the Accurate Partitions consent decree and thus Akzo's claim was barred by the statute. The district court converted the motion into one for summary judgment in accordance with Fed.R.Civ.P. 12(b) and ruled in Aigner's favor, agreeing that Akzo sought contribution for a "matter addressed" by the consent decree. Akzo Coatings, Inc. v. Aigner Corp., 803 F.Supp.

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1380 (N.D.Ind.1992). Although the court's ruling did not dispose of all of Akzo's claims, the court certified its ruling for immediate appeal under Fed.R.Civ.P. 54(b).

II. ANALYSIS

Section 113(f) of CERCLA, added to the statute in 1986, authorizes claims for contribution, subject to the limitation set forth in paragraph (2):

(1) Contribution

Any person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action under section 9606 of this title or under section 9607(a) of this title.... In resolving contribution claims, the court may allocate response costs among liable parties using such equitable factors as the court determines are appropriate. Nothing in this subsection shall diminish the right of any person to bring an action for contribution in the absence of a civil action under section 9606 or section 9607 of this title.

(2) Settlement

A person who has resolved its liability to the United States or a State in an administrative or judicially approved settlement shall not be liable for claims for contribution regarding matters addressed in the settlement. Such settlement does not discharge any of the other potentially liable persons unless its terms so provide, but it reduces the potential liability of the others by the amount of the settlement.

42 U.S.C. Sec. 9613(f). The district court concluded that Akzo is seeking contribution under section 113(f)(1) and that Aigner is not liable because the clean-up of the entire Fisher-Calo site is a "matter addressed in the settlement." Akzo disagrees with both conclusions: it contends that it is not seeking "contribution" at all and that the work the EPA ordered it to perform at the Two-Line Road facility was not a "matter addressed" in the consent decree. The United States, offering its opinion as amicus curiae, suggests that Akzo is wrong on the first argument but right on the second. We agree.

That Akzo's claim is one for contribution we have no doubt. Akzo argues that its suit is really a direct cost recovery action brought under section 107(a) rather than a suit for contribution under section 113(f)(1); and it is true that section 107(a) permits any "person"--not just the federal or state governments--to seek recovery of appropriate costs incurred in cleaning up a hazardous waste site. 42 U.S.C. Sec. 9607(a), subpart (B). Yet, Akzo has experienced no injury of the kind that would typically give rise to a direct claim under section 107(a)--it is not, for example, a landowner forced to clean up hazardous materials that a third party spilled onto its property or that migrated there from adjacent lands. Instead, Akzo itself is a party liable in some measure for the contamination at the Fisher-Calo site, and the...

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