Aviall Services, Inc. v. COOPER INDUSTRIES, LLC

• Decision Date: 05 February 2010
• Docket Number: Civil Action No. 3:97-CV-1926-D.
• Parties: AVIALL SERVICES, INC., Plaintiff-counterdefendant, v. COOPER INDUSTRIES, LLC, Defendant-counterplaintiff.
• Court: U.S. District Court — Northern District of Texas

694 F. Supp.2d 567

AVIALL SERVICES, INC., Plaintiff-counterdefendant, v. COOPER INDUSTRIES, LLC, Defendant-counterplaintiff.

Civil Action No. 3:97-CV-1926-D.

United States District Court, N.D. Texas, Dallas Division.

February 5, 2010.

Richard O. Faulk, Jose A. Berlanga, Gardere, Wynne, Sewell, Houston, TX, Cynthia J. Bishop, Douglas Steward Lang, Joan Krajewski, Paul Edward Kennedy, Gardere, Wynne, Sewell, Dallas, TX, for Plaintiff.

Elizabeth E. Mack, Locke, Lord, Bissell & Liddell, LLP, Dallas, TX, Craig L. Weinstock, Locke, Lord, Bissell & Liddell, LLP, Houston, TX, for Defendant.

MEMORANDUM OPINION AND ORDER

SIDNEY A. FITZWATER, Chief Judge.

In this environmental cleanup litigation, the court addresses the parties' motions for partial summary judgment concerning certain of plaintiff-counterdefendant's state-law claims and one of defendant-counterplaintiff's state-law counterclaims. As with other motions that the court has decided in this case, some of the questions presented involve issues of nascent law. For the reasons that follow, the court grants in part and denies in part both parties' motions.

I

This protracted lawsuit is the subject of several prior opinions, including Aviall Services, Inc. v. Cooper Industries, LLC, 572 F.Supp.2d 676 (N.D.Tex.2008) (Fitzwater, C.J.) ("Aviall III"). The court will therefore limit its discussion of the background facts and procedural history to what is pertinent to today's decision.

Before 1981, defendant-counterplaintiff Cooper Industries, LLC, ("Cooper") (then known as Cooper Industries, Inc.) owned four sites at which it operated an aircraft engine maintenance business: Forest Park Facility ("Forest Park"), Love Field Facility ("Love Field"), Carter Field Facility, and Lemmon Terminal Facility ("the Facilities"). In 1981, Cooper sold the business to plaintiff-counterdefendant Aviall Services, Inc. ("Aviall"). Aviall later discovered that both Aviall and Cooper had contaminated the soil and groundwater at the Facilities with hazardous and non-hazardous contaminants. Aviall III, 572 F.Supp.2d at 682. During the period when Aviall was the owner, it notified the Texas Natural Resource Conservation Commission ("TNRCC") of the pollution.¹ The TNRCC advised Aviall that it was violating state environmental laws, directed it to clean up the sites, and threatened enforcement action if Aviall failed to undertake remediation. Aviall voluntarily cleaned up the properties, and neither the U.S. Environmental Protection Agency, the TNRCC, nor any other governmental entity has taken judicial or administrative measures against Aviall or Cooper. No third party has sued Aviall or Cooper concerning any of the conditions of the Facilities.

Aviall seeks relief in this suit on various federal-law claims, which the court has addressed in prior opinions. Aviall also sues Cooper to recover on the following state-law claims: breach of contract; breach of express warranty; contractual indemnification; declaratory judgment; contribution under § 361.344(a) of the Texas Solid Waste Disposal Act, Tex. Health & Safety Code Ann. (Vernon 2001) ("SWDA"); contribution under § 26.3513(j) of the Texas Water Code, Tex. Water Code Ann. (Vernon 2008) ("TWC"); common law contribution; quantum meruit; and attorney's fees. Cooper counterclaims for breach of contract, alleging that Aviall breached the parties' release of liability, in which the parties agreed not to bring suit on liabilities that had been released.

Cooper moves for summary judgment on each of Aviall's state-law claims and on its counterclaim. Aviall moves for partial summary judgment establishing its right to recover on its SWDA, TWC, breach of contract, contractual indemnification, and quantum meruit claims.²

II

The parties' summary judgment burdens depend on whether they are addressing a claim or defense for which they will have the burden of proof at trial. In most respects, Cooper moves for summary judgment on claims as to which Aviall will bear the burden of proof. As to these claims, Cooper need only point the court to the absence of evidence of any essential element of Aviall's claim. See Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once Cooper does so, Aviall must go beyond its pleadings and designate specific facts showing there is a genuine issue for trial. See id. at 324, 106 S.Ct. 2548; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir.1994) (en banc) (per curiam). An issue is genuine if the evidence is such that a reasonable jury could return a verdict in Aviall's favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Aviall's failure to produce proof as to any essential element of a claim renders all other facts immaterial. See Trugreen Landcare, L.L.C. v. Scott, 512 F.Supp.2d 613, 623 (N.D.Tex.2007) (Fitzwater, J.). Summary judgment is mandatory if Aviall fails to meet this burden. See Little, 37 F.3d at 1076.

Aviall and Cooper also move for summary judgment on claims and defenses for which they will bear the burden of proof at trial. To be entitled to summary judgment on such a claim or defense, a party "must establish `beyond peradventure all of the essential elements of the claim or defense.'" Bank One, Tex., N.A. v. Prudential Ins. Co. of Am., 878 F.Supp. 943, 962 (N.D.Tex.1995) (Fitzwater, J.) (quoting Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir.1986)). "The court has noted that the `beyond peradventure' standard is `heavy.'" Carolina Cas. Ins. Co. v. Sowell, 603 F.Supp.2d 914, 923 (N.D.Tex.2009) (Fitzwater, C.J.) (quoting Cont'l Cas. Co. v. St. Paul Fire & Marine Ins. Co., 2007 WL 2403656, at *10 (N.D.Tex. Aug. 23, 2007) (Fitzwater, J.)).³

III

Cooper moves for summary judgment dismissing Aviall's claim for common law contribution. Citing Casa Ford, Inc. v. Ford Motor Co., 951 S.W.2d 865 (Tex.App. 1997, pet.denied), Cooper argues that Texas common law does not recognize such a right. Aviall concedes in response "that Texas common-law contribution has been replaced by statutory provisions," P. July 20, 2009 Br. 49, and it withdraws the claim. The court therefore denies Cooper's motion without prejudice as moot to the extent it relates to this withdrawn claim.

IV

Aviall seeks summary judgment establishing its claim for contribution under § 361.344(a) of the SWDA. Cooper moves on several grounds for summary judgment dismissing this claim.

A

To recover under § 361.344(a), Aviall must prove the following essential elements:

(1) Cooper is a "person responsible for solid waste" as defined in Tex. Health & Safety Code Ann. § 361.271; (2) the TNRCC approved Aviall's removal or remedial action; (3) the action was necessary to address a release or threatened release of solid waste; (4) the costs of the action were reasonable and necessary; and (5) Aviall made reasonable attempts to notify Cooper of both the release and Aviall's intent to take steps to eliminate the release.

R.R. Street & Co. v. Pilgrim Enters., Inc., 166 S.W.3d 232, 240 (Tex.2005) ("R.R.Street II") (citing Tex. Health & Safety Code Ann § 361.344).

B

Cooper argues that Aviall's SWDA contribution claim is time-barred because the claim accrued as soon as Aviall knew the facts that gave rise to Cooper's potential liability—i.e., as soon as Aviall became aware of the contamination. Cooper maintains that this rule is necessary to prevent a party from indefinitely delaying recovery under the SWDA. It asserts that, for Forest Park and Love Field, Aviall had relevant knowledge as early as when it purchased those facilities in 1981, because the knowledge of Cooper's former employees—whom Aviall retained after it purchased the Facilities—was imputed to Aviall. Cooper posits that Aviall became aware of the contamination at all four Facilities through a series of reports from 1987 to 1991. It therefore argues that the limitations period⁴ expired before the parties entered into a tolling agreement in 1996,⁵ and that Aviall's SWDA claim is time-barred.

Aviall responds that its claim did not accrue until facts supporting each element came into existence: i.e., in 1997, when Texas amended the SWDA. Before 1997, § 361.344 enabled a party to seek contribution only if the party was under a court injunction or administrative order. See Tex. Health & Safety Code Ann. § 361.344(a) (Vernon 1989) (repealed Sept. 1, 1997). Aviall asserts that it has never been subject to any order regarding contamination at the Facilities. It maintains that its cause of action could not have accrued until 1997, when Texas amended the SWDA to allow a party to seek contribution so long as it was pursuant to an agreement with the TNRCC.

Cooper maintains that the TNRCC would have placed Aviall under an order had Aviall so requested, and therefore that a remedy was available even under the pre-1997 SWDA. Cooper reasons that, because a remedy was available before 1997, Aviall's claim accrued before 1997. Alternatively, Cooper posits that the 1997 amendment should not be applied retrospectively to require Cooper to contribute to cleanup costs incurred before the amended statute took effect.

Aviall replies that it had no duty to seek an order from the TNRCC, that the 1997 amendment should be considered remedial or procedural and applied retroactively, and that the amended version of the SWDA supports Aviall's recovery of expenses incurred before the amended version took effect.

C

To decide whether Aviall's contribution claim is time-barred, the court must first determine the limitations period commenced on the date on which contamination merely existed at a facility, the date on which Aviall actually or constructively knew of the contamination, or the date a legal remedy became available to Aviall.⁶

"Generally, a cause of action accrues and limitations begins to run when facts exist that authorize a claimant to seek judicial relief." Schneider Nat'l Carriers, Inc. v. Bates, 147...