Centerior Service Co. v. Acme Scrap Iron & Metal Corp.

• Decision Date: 31 August 1998
• Docket Number: No. 97-3163,97-3163
• Citation: 153 F.3d 344
• Parties: 29 Envtl. L. Rep. 20,065 CENTERIOR SERVICE COMPANY; General Electric Company; Ashland Oil, Incorporated, Plaintiffs-Appellants, v. ACME SCRAP IRON & METAL CORPORATION, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 344

153 F.3d 344

29 Envtl. L. Rep. 20,065

CENTERIOR SERVICE COMPANY; General Electric Company Ashland Oil, Incorporated, Plaintiffs-Appellants, v. ACME SCRAP IRON & METAL CORPORATION, et al., Defendants-Appellees.

No. 97-3163.

United States Court of Appeals Sixth Circuit.

Argued Jan. 27, 1998.

Decided Aug. 31, 1998.

Robert Garrett Cohen, Kegler, Brown, Hill & Ritter, Columbus, OH, Jeffrey M. Karp (briefed), Thomas M. Downs (argued and briefed), Swidler & Berlin, Washington, DC, for Plaintiffs-Appellants.

Jeffrey C. Conrad, Mia T. Lombardi (briefed), McDonald, Hopkins, Burke & Haber, Cleveland, OH, for Defendants-Appellees The Standard Oil Company, Ken Chas Reserve Company.

Louis E. Tosi (argued and briefed), Douglas G. Haynam (briefed), John C. Everhardus (briefed), Emily K. Cooper, Shumaker, Loop & Kendrick, Toledo, OH, for Defendant-Appellee General Motors Corporation.

Myra L. Willis (briefed), Howard & Howard, Kalamazoo, MI, for Defendant-Appellee Chrysler Corporation.

Charles R. Schaller (briefed), Marian C. Hwang (briefed), Miles & Stockbridge, Baltimore, MD, for Defendant-Appellee Black & Decker, Inc.

James T. Millican (briefed), Bertsch, Millican & Winslow, Cleveland, OH, for Defendant-Appellee The Glidden Company.

Carter E. Strang (briefed), Henry E. Billingsley, II, Arter & Hadden, Cleveland, OH, for Defendant-Appellee Atlantic Richfield Co., et al.

Arthur I. Harris, Asst. U.S. Attorney, Office of U.S. Attorney, Cleveland, OH, Jeremy D. Heep (argued and briefed), U.S. Department of Justice, Environment and Natural Resources, Washington, DC, Ronald M. Spritzer, Mr., Department of Justice, Environment & Natural Resources Division, Washington, DC, for Defendants-Appellees Secretary of Defense, Secretary of Veterans Affairs, Administrator of National Aero and Space Administration.

James L. McCrystal, Jr. (briefed), Martindale, Brzytwa & Quick, Cleveland, OH, for Defendant-Appellee Pepsico, Inc.

Gary W. Johnson (briefed), Weston, Hurd, Fallon, Paisley & Howley, Cleveland, OH, for Defendants-Appellees United Parcel Service, Ohio Broach and Machine Company.

William E. Coughlin (briefed), David J. Carney, Robert J. Bonko, Calfee, Halter & Griswold, Cleveland, OH, for Defendants-Appellees Union Carbide Corp., Best Sand Corporation.

Steven F. Faeth (briefed), Eckert, Seamans, Cherin & Mellott, Pittsburgh, PA, for Defendant-Appellee Westinghouse Electric Corporation.

Charles J. Cochran, Jr. (briefed), Casalinova & Cochran, Fairlawn, OH, for Defendant-Appellee Holland Oil Company.

Pamela N. Hultin, McCarthy, Lebit, Crystal & Haiman, Cleveland, OH, for Defendant-Appellee Garfield Heights Coachlines.

Jack A. Van Kley, John W. Edwards, Jones, Day, Reavis & Pogue, Columbus, OH, for Defendants-Appellees East Ohio Gas Company and Columbia Gas of Ohio, Inc.

John L. Shailer, Columbia Gas Distribution Companies, Columbus, OH, for Defendant-Appellee Columbia Gas of Ohio, Inc.

Mary M. Bittence, Baker & Hostetler, Cleveland, OH, for Defendants-Appellees Shell Oil Company, The Lincoln Electric Company.

Before: JONES, DAUGHTREY, and COLE, Circuit Judges.

OPINION

NATHANIEL R. JONES, Circuit Judge.

The issue confronting this court on interlocutory appeal is whether a party who is itself potentially responsible for the response costs of a hazardous waste cleanup under the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §§ 9601-9675 ("CERCLA"), is permitted to bring a joint and several cost recovery action against other potentially responsible parties ("PRPs") under § 107(a) of CERCLA, or is limited to actions for contribution. For the following reasons, we find that PRPs are precluded from seeking joint and several cost recovery under § 107(a) and AFFIRM the judgment of the district court.

I. Background

The facts of this case are undisputed. From approximately 1938 until 1990, the Huth Oil Services Company operated a waste oil reclamation facility at the Huth Oil Site. The site was owned by plaintiff Ashland Oil Incorporated from 1964 until 1981, ¹ when Huth Oil purchased the property from Ashland. The site contained approximately 33 oil storage tanks with a 992,000 gallon storage capacity. J.A. (Joint Appendix) at 582. Numerous companies deposited waste oil at the site during its more than 40 years of operation.

Between 1983 and 1989, the United States Environmental Protection Agency ("EPA") and the Ohio Environmental Protection Agency inspected the site, and on several occasions found that the storage tanks and saturated soils at the site were contaminated with hazardous substances, mainly poly chlorinated biphenyl's. The EPA also noted that the site was in a dilapidated condition, that its oil tanks were corroded, and that unauthorized access to the site was possible through gaps in the fence surrounding it. J.A. at 589. Subsequently, after an investigation, the EPA identified four PRPs that played a hand in the poor conditions of the site: (1) Ashland Oil, the current owner/operator of the site; (2) Huth Oil, a previous owner; (3) Cleveland Electric Illuminating Co.; ² and (4) plaintiff General Electric Company. The EPA found that the latter two parties had each arranged for disposal of hazardous substances at the site.

On October 5, 1990, based on the above findings, the EPA issued a unilateral Administrative Order to the plaintiffs ³ under CERCLA § 106, which required the plaintiffs to undertake and complete an emergency cleanup of the site. ⁴ To this end, the plaintiffs assert that they incurred approximately $9.5 million in costs relating to the cleanup required by the § 106 order. ⁵ After beginning the cleanup efforts, the plaintiffs conducted their own investigation to identify other potentially responsible parties for the site contamination. The plaintiffs identified approximately 250 parties that had arranged for the disposal of waste oil and other hazardous substances at the site. At no point, however, did the plaintiffs contest their status as PRPs, assert defenses to liability under § 107(a), or seek reimbursement for their response costs from the government under CERCLA § 106(b). ⁶

In August 1994, the plaintiffs filed five one-count claims for relief against more than 125 defendants seeking to recover their cleanup costs from these parties under § 107(a) of CERCLA, and asserting that the defendants were jointly and severally liable for the costs. ⁷ On August 5, 1995, the cases were consolidated for the purposes of discovery and pre-trial proceedings. Subsequently, ten motions were filed by various parties all concerning whether the plaintiffs were permitted to bring a joint and several cost recovery action against the defendants under § 107(a) of CERCLA, or whether they were limited to bringing contribution claims under CERCLA § 113(f), 42 U.S.C. § 9613(f).

On September 13, 1996, the district court resolved all ten motions by ruling that the plaintiffs, as PRPs, were limited to bringing a cause of action for contribution under § 113(f) of CERCLA, and that all of the plaintiffs' original complaints pleading joint and several cost recovery actions under § 107(a) would be construed as asserting a contribution claim under § 113(f). On October 4, 1996, the plaintiffs filed a motion to amend the district court's order for certification under 28 U.S.C. § 1292(b). The district court granted the motion on December 3, 1996, and on December 13, 1996, the plaintiffs filed a petition for permission to appeal the district court's order pursuant to § 1292(b) and Fed. R.App. P. 5. This court granted the plaintiffs' petition on February 13, 1997.

II. Discussion

A.

We have jurisdiction to hear this interlocutory appeal pursuant to 28 U.S.C. § 1292(b) and this court's order granting the parties' permission to appeal. The issue on appeal involves a question of statutory interpretation and construction, which is a question of law subject to de novo review. See United States v. Spinelle, 41 F.3d 1056, 1057-58 (6th Cir.1994); Covill v. United States, 959 F.2d 58, 61 (6th Cir.1992).

B.

CERCLA is the primary statutory means by which harmful or potentially harmful hazardous waste disposal sites are remediated. The statute grants the EPA broad enforcement powers and options. For example, the EPA may on its own initiate response actions to clean up a hazardous waste site using monies from the Hazardous Substances Superfund, CERCLA § 104, 42 U.S.C. § 9604, and then recover its response costs from PRPs. It may also require the private PRPs to themselves undertake response actions by either issuing a § 106 administrative order requiring remedial action, or by seeking judicial injunctive relief requesting a court to compel the party to initiate the cleanup. 42 U.S.C. § 9606(a).

Once a site has been cleaned up, CERCLA provides two causes of action for parties to recover the response costs incurred by the cleanup effort: joint and several cost recovery actions governed exclusively by § 107(a), see 42 U.S.C. § 9607(a), and contribution actions as set forth in § 113(f). See id. § 9613(f)(1). Section 107(a)(4) provides in pertinent part that PRPs ⁸ are liable for:

(A) all costs of removal or remedial action incurred by the United States Government or a State or an Indian tribe not inconsistent with the national contingency plan;

(B) any other necessary costs of response incurred by any other person consistent with the national contingency plan[.]

42 U.S.C. § 9607(a)(4)(A) & (B). The government may seek costs under § 107(a)(4)(A), and private parties have an implied private right of action for response costs through § 107(a)(4)(B). See Key Tronic Corp. v. United States, 511 U.S. 809, 114 S.Ct. 1960, 128 L.Ed.2d 797 (1994). In order to establish a prima facie case for cost recovery under § 107(a), a plaintiff must prove four elements: (1) the site is a "facility"; (2) a release or threatened release of hazardous substance has occurred; (3) the release has caused the...