City of Bangor v. Citizens Communications Co.

• Decision Date: 09 July 2008
• Docket Number: No. 07-2759.,No. 07-2777.,No. 07-2193.,No. 07-2255.,07-2193.,07-2255.,07-2759.,07-2777.
• Court: U.S. Court of Appeals — First Circuit
• Parties: CITY OF BANGOR, Plaintiff, Appellee, v. CITIZENS COMMUNICATIONS COMPANY, Defendant/Third-Party Plaintiff, Appellee, v. UGI Utilities, Inc.; Centerpoint Energy Resources Corp., et al., Third-Party Defendants, Barrett Paving Materials Inc.; Honeywell International Inc.; Beazer East, Inc.; Dead River Company, Third-Party Defendants, Appellants, v. Société Routière Colas, S.A., Fourth-Party Defendant, Appellant, Robinson Speirs, Jr.; Julie Ann MacMannis; Nancy S. Dawson; Elizabeth H. Speirs; Mary S. Price; Robinson Speirs, Fourth-Party Defendants, Appellants. State of Maine; Maine Department of Environmental Protection, Appellees.

532 F.3d 70

CITY OF BANGOR, Plaintiff, Appellee, v. CITIZENS COMMUNICATIONS COMPANY, Defendant/Third-Party Plaintiff, Appellee, v. UGI Utilities, Inc.; Centerpoint Energy Resources Corp., et al., Third-Party Defendants, Barrett Paving Materials Inc.; Honeywell International Inc.; Beazer East, Inc.; Dead River Company, Third-Party Defendants, Appellants, v. Société Routière Colas, S.A., Fourth-Party Defendant, Appellant, Robinson Speirs, Jr.; Julie Ann MacMannis; Nancy S. Dawson; Elizabeth H. Speirs; Mary S. Price; Robinson Speirs, Fourth-Party Defendants, Appellants.

State of Maine; Maine Department of Environmental Protection, Appellees.

No. 07-2193.

No. 07-2255.

No. 07-2759.

No. 07-2777.

United States Court of Appeals, First Circuit.

Heard April 8, 2008.

Decided July 9, 2008.

Gregory A. Bibler with whom Paul E. Nemser, Francis G. Kelleher, Christophe G. Courchesne, and Goodwin Procter LLP were on brief for Honeywell International Inc.

Robert S. Frank with whom Harvey & Frank was on brief for Dead River Company.

William B. Devoe with whom Eaton Peabody, W. Scott Laseter, and Kazmarkek Geiger & Laseter LLP were on brief for City of Bangor.

John S. Hahn with whom Jay C. Johnson, Mayer Brown LLP, Martha C. Gaythwaite, and Friedman, Gaythwaite, Wolf & Leavitt were on brief for Citizens Communication Company.

Mary M. Sauer, Assistant Attorney General, with whom Paul Stern, Deputy Attorney General, and G. Steven Rowe, Attorney General, were on brief for State of

Maine and Maine Department of Environmental Protection.

John P. McVeigh, David B. Van Slyke, and Preti Flaherty Beliveau & Pachios LLP were on brief for Barrett Paving Materials, Inc.

Michael Kaplan and Preti Flaherty Beliveau & Pachios LLP were on brief for Société Routière Colas, S.A.

Jeffrey A. Thaler and Bernstein, Shur, Sawyer & Nelson were on brief for Beazer East, Inc.

Samuel W. Lanham, Jr. and Lanham & Blackwell were on brief for Robinson Speirs, Elizabeth H. Speirs, Mary S. Price, Nancy S. Dawson, Julie Ann MacMinnis, and Robinson Speirs, Jr.

Before LYNCH, Chief Judge, MERRITT,^* Senior Circuit Judge, and HOWARD, Circuit Judge.

LYNCH, Chief Judge.

This case concerns responsibility for the cleanup of the contamination of the bed of Penobscot River in Bangor, Maine, known as Dunnett's Cove, under the federal Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq.

Specifically, we are being asked to overturn the district court's approval, after nearly five years of litigation, of a Consent Decree which allocates certain responsibilities among defendant Citizens Communications Company, the plaintiff City of Bangor, and the intervenor State of Maine (including the Maine Department of Environmental Protection ("DEP")). City of Bangor v. Citizens Commc'ns Co. (Bangor II), No. 02-183, 2007 WL 1557426 (D.Me. May 25, 2007). The appellants are nonsettling third and fourth parties who are said to be potentially responsible parties. We are also being asked to order the district court, which has not ruled on the question of the non-settling parties' liability, to enter judgment in favor of the appellants on a particular theory.

The United States, through the Environmental Protection Agency, is not and has never been a party in this action, unlike in most CERCLA actions. We consider whether the absence of the United States affects the standard of review of the Consent Decree and conclude that it does. We affirm the Consent Decree and other orders being challenged.

I.

A fairly extensive discussion of the background of the case is required.

A. Original Complaint

The City of Bangor initially filed a cost recovery suit in 2002 under the private plaintiff provisions of CERCLA, 42 U.S.C. §§ 9607, 9613, against Citizens Communications Company. Citizens filed a counterclaim against Bangor, claiming that the City was responsible for some of the contamination, and filed complaints against numerous third parties.

The City's complaint alleged Citizens is a potentially responsible party ("PRP") for the contamination from the manufactured gas plant ("MGP" or "Site"), which operated in Bangor from approximately 1851 to 1963. In 1948 Citizens merged with the Bangor Gas Company, then the owner of the MGP, and succeeded to and assumed all liability relating to the MGP. Citizens sold the Site to the Maine Utility Gas Company in April 1963. In 1978, the City of Bangor took the property through eminent domain. The complaint alleged that the City had expended over $1.125 million in investigative and cleanup costs and had suffered from the property's diminished value.

The complaint alleged the MGP discharged tar, tar-laden wastewater, and other byproducts into the Penobscot River through a stone sewer that ran beneath the Site and emptied into the river, and that various construction activities at the Site contributed to the contamination.

The complaint alleged that those hazardous waste discharges created a tar slick on the bottom of the Penobscot River that begins at the outfall of the stone sewer and extends at least 1500 feet downstream. As a result, globules from the tar slick periodically "bubble to the surface and coat boats, docks, bridges and the shoreline in the vicinity.... These and other releases from the tar slick emit hazardous and toxic chemicals that are potentially harmful to humans and numerous aquatic species." Hazardous wastes from the Site allegedly have also contaminated the soil beneath an adjacent playground and other nearby properties.

The complaint sought cost recovery under CERCLA section 107, 42 U.S.C. § 9607, and a declaration that Citizens was jointly and severally liable for all future cleanup costs. In the alternative, the City sought a declaration under CERCLA section 113, id. § 9613, that Citizens would be responsible for an equitable share of all future cleanup costs. The City also sought relief under Maine statutory and common law.¹

B. Early Proceedings and Complaints Against Third and Fourth Parties

Citizens filed an answer on December 26, 2002, arguing, inter alia, that because the City is a responsible party, it cannot maintain any claims against Citizens under CERCLA section 107. Citizens also filed a counterclaim, alleging that the City was responsible for contamination of Penobscot River and qualified as a "responsible person" under CERCLA, id. § 9607(a), and so was responsible for an equitable share of response costs under CERCLA, id. § 9613(f)(1).

Bangor filed an Amended Complaint on April 17, 2003 that added the State of Maine to the case caption as a purported "party-in-interest" and asserted additional claims against Citizens under a provision of the federal Resource Conservation and Recovery Act ("RCRA"), id. § 6972(a)(1)(B).² Citizens opposed adding the State as a party, arguing that this "method of adding a new party was completely improper" and that the State's inclusion "would merely add confusion to the proceedings." The State sent a letter to the court saying it had two interests in the litigation: from its regulatory authority over uncontrolled hazardous waste sites and from the State's property interest in the river bed on which a portion of the tar plume rests. The State indicated that it believed its status "is correctly denominated as a `party-in-interest.'"

On August 6, 2003, the district court granted Citizens's Motion To Strike or Drop the State of Maine as a Party. The court rejected Bangor's suggestion that the court use its equitable powers to allow the State to participate as a "party-in-interest," holding that Bangor had not demonstrated any legal authority for its doing so. The court suggested that if the State wanted to participate, it should either intervene under Fed.R.Civ.P. 24 or request to be included as an amicus curiae. Alternatively, the court noted that the plaintiff, Bangor, could move to join the State under Fed.R.Civ.P. 20. Bangor did not do so.

In the interim, on April 30, 2003, Citizens filed third-party complaints, under Fed.R.Civ.P. 14, 19, and 20, against Barrett Paving Materials, Inc.; the U.S. Army Corps of Engineers; Guilford Transportation Industries, Inc.; Honeywell International Inc.; S.E. MacMillan Company, Inc.; Dead River Company; Northwestern Growth Corporation; UGI Utilities, Inc.; North American Utility Construction Corp.; Beazer East, Inc.; and Centerpoint Energy Resources Corp., seeking contribution and/or indemnity for any environmental cleanup costs for which it might be held liable. On August 26, 2003, Citizens filed an additional third-party complaint against Maine Central Railroad Company. Various fourth parties were added.³ Bangor filed a Second Amended Complaint on October 22, 2003, which did not seek to add any additional parties.

C. Motions for Summary Judgment

On October 24, 2003, Citizens moved for partial summary judgment under CERCLA section 107 on the grounds that the City was a responsible person and therefore unable to bring a joint liability claim under this provision of CERCLA.

On November 18, 2003, the U.S. Army Corps of Engineers filed a motion for partial judgment on the pleadings, arguing that Citizens had no claim for contribution against it because Citizens was potentially liable only for its equitable share, and parties facing only equitable liability cannot bring contribution claims.

On March 11, 2004, the magistrate judge recommended granting Citizens's motion for partial summary judgment on the ground that Bangor was precluded from obtaining a full recovery under CERCLA section 107 because it was a PRP. City of Bangor v. Citizens Commc'ns Co., No. 02-183, 2004 WL 483201, at *1 (D.Me. Mar.11, 2004).⁴

The magistrate judge also recommended granting the Army Corps's motion on the grounds that Citizens was potentially liable to Bangor only to the extent of its equitable share in the City's cleanup costs and therefore had "no legal basis to seek contribution from third-parties."...