ELG Utica Alloys, Inc. v. Niagara Mohawk Power Corp.

• Decision Date: 27 March 2023
• Docket Number: 6:16-cv-1523 (BKS/ATB)
• Parties: ELG UTICA ALLOYS, INC., Plaintiff, v. NIAGARA MOHAWK POWER CORP. d/b/a National Grid, SPECIAL METALS CORP., GENERAL ELECTRIC COMPANY, EMPIRE RECYCLING CORP., and CHICAGO PNEUMATIC TOOL COMPANY, LLC, Defendants. NIAGARA MOHAWK POWER CORP. d/b/a National Grid, Third-Party Plaintiff, v. CBS CORPORATION (successor-in-interest to Westinghouse Electric Corporation), Third-Party Defendant.
• Court: U.S. District Court — Northern District of New York

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ELG UTICA ALLOYS, INC., Plaintiff, v. NIAGARA MOHAWK POWER CORP. d/b/a National Grid, SPECIAL METALS CORP., GENERAL ELECTRIC COMPANY, EMPIRE RECYCLING CORP., and CHICAGO PNEUMATIC TOOL COMPANY, LLC, Defendants.

NIAGARA MOHAWK POWER CORP. d/b/a National Grid, Third-Party Plaintiff, v. CBS CORPORATION (successor-in-interest to Westinghouse Electric Corporation), Third-Party Defendant.

No. 6:16-cv-1523 (BKS/ATB)

United States District Court, N.D. New York

March 27, 2023

For Plaintiff: David P. Flynn David L. Cook Robert Reagan Phillips Lytle LLP

For Defendant Niagara Mohawk Power Corp. d/b/a National Grid Yvonne E. Hennessey Barclay Damon LLP

For Defendant Special Metals Corp.: Doreen A. Simmons Hancock Estabrook, LLP

For Defendant General Electric Company: Kristin Carter Rowe Dean Sommer Young/Sommer LLC Executive Woods

For Defendant Empire Recycling Corp.: Gary S. Bowitch Law Office of Gary S. Bowitch

For Defendant Chicago Pneumatic Tool Company, LLC: Agnes Antonian Connell Foley, LLP

For Third-Party Defendant CBS Corporation (successor-in-interest to Westinghouse Electric Corporation): Marc J. Felezzola James D. Mazzocco Babst, Calland, Clements & Zomnir, P.C. Two Gateway Center

MEMORANDUM-DECISION AND ORDER

Hon Brenda K. Sannes, Chief United States District Judge

I. INTRODUCTION

Plaintiff ELG Utica Alloys, Inc. brings this action asserting claims under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), 42 U.S.C. §§ 9601-9675; under Article 12 of the New York Navigation Law; and for contribution under the New York Civil Practice Law and Rules (“CPLR”) and New York common law. (Dkt. No. 43 (amended complaint)). Plaintiff seeks response costs and damages arising out of the release or threatened release of hazardous substances at “the Universal Waste Site,” which “operated as a metal recycling operation” in Utica, New York from the 1950s until 2012. (Id. ¶¶ 1-2). Plaintiff seeks to hold Defendants Niagara Mohawk Power Corp. d/b/a National Grid (“National Grid”), Special Metals Corp. (“SMC”), General Electric Company (“GE”), Empire Recycling Corp. (“ERC”), and Chicago Pneumatic Tool Company, LLC (“CP”) liable for their share of approximately $6,700,000 in “past response costs and other damages . . . incurred from 2012 to date” and “future response costs and damages.” (Id. ¶¶ 1, 9).

Presently before the Court is the joint motion of Defendants and Third-Party Defendant CBS Corporation (successor-in-interest to Westinghouse Electric Corporation) (“CBS”) for summary judgment and spoliation sanctions pursuant to Rules 56 and 37 of the Federal Rules of Civil Procedure. (Dkt. No. 246).^[1] The motion is fully briefed. (See Dkt. Nos. 247-258, 264, 265). For the following reasons, the Court grants Defendants' motion for spoliation sanctions but defers selection of the sanction, and grants Defendants' motion for summary judgment.

II. BACKGROUND

A. Facts Relating to Defendants' Summary Judgment Motion^[2]

1. Site Background

The Universal Waste Site at issue in the complaint is an approximately 20-acre parcel of land located in Utica, New York near the intersection of Leland and Wurz Avenues. (Dkt. No. 246-2, ¶ 1; Dkt. No. 264, ¶ 1; Dkt. No. 265-1, ¶ 1). The Universal Waste Site at issue is part of a 23-acre parcel of land owned by Plaintiff (“the full Site” or “the Site”), which in 1998 was administratively bifurcated to facilitate the remediation of approximately 1.5 acres of the Site. (The 1.5-acre parcel was designated the “Utica Alloys, Inc.” Site.) The 23-acre Site is in close proximity to the Mohawk River and “located in a flood plain.” (Dkt. No. 253-5, at 2; see also Dkt. No. 253-9, at 5).

As relevant here, Utica Alloys, Inc. and Universal Waste, Inc. (together, “the Companies”) conducted operations at the full Site, including scrap recycling operations. (See Dkt. No. 246-2, ¶ 2; Dkt. No. 264, ¶ 2; Dkt. No. 43, ¶ 2 (alleging that the “Site operated as a metal recycling operation from at least the 1950s until 2012”)). Utica Alloys, Inc. was formed to “deal in, buy, sell and process all high and low temperature alloys . . .; to operate vacuum melt furnaces, found[]ries and deal generally in reclamation of alloys; [and] to process all non-ferrous metals.” (Dkt. No. 252-4, at 2). Universal Waste, Inc. was formed to “buy, sell, reclaim, manufacture, convert and deal in waste metal, waste paper, rags, iron, steel, [and] non-ferr[o]us metals.” (Dkt. No. 252-5, at 2; see also Dkt. No. 253-9, at 4 (“Universal Waste, Inc. is engaged in the buying and selling of paper, metal, and other waste materials. Utica Alloys, Inc. is engaged in the buying, selling, processing, and reclaiming of high- and low-temperature alloys, and nonferrous metals.”)). The Companies had the same voting stockholder, officers, and directors; used the same buildings and areas at the Site; and shared Site costs. (Dkt. No. 246-2, ¶ 3; Dkt. No. 264, ¶ 3).

Since at least 1984, the 23-acre Site has been owned by the same company. (See Dkt. No. 252-10 (1984 indenture transferring the property to Clearview Acres Limited, Inc. (“Clearview”) and 1984 leases of the property to the Companies)); see infra Section II.A.7 (detailing 2008 sale of property to Plaintiff).

2. 1977 Discovery of Contamination at the Site and 1979 Response

In a July 19, 1977 letter to Universal Waste following an inspection of the Site, the New York Department of Environmental Conservation (“NYSDEC”) expressed “concern” with “the handling of electrical components such as transformers and capacitors, and . . . the possible discharge of solvents from [Universal Waste's] degreasing operation.” (Dkt. No. 253-2, at 2). NYSDEC noted that large transformers and capacitors “may be filled with” polychlorinated biphenyls (“PCBs”), a harmful substance. (Id.). NYSDEC sampled the soil in the vicinity of the stockpile of transformers and capacitors and noted that “positive action will have to be taken” if PCBs were detected. (Id.). Analysis of the samples taken revealed the presence of PCBs and trichloroethylene (“TCE”), another harmful substance. (Dkt. No. 253-3 (memorandum dated March 30, 1979 enclosing laboratory results)). The EPA inspected the Site on October 24, 1979, and in a “potential hazardous waste site identification and preliminary assessment,” noted concerns about PCBs on the Site; the EPA reported that “remedial activity” in the form of soil removal was being performed. (Dkt. No. 253-4, at 16-19).

In late 1979, after requesting and receiving information from NYSDEC regarding the logistics of off-site disposal, Universal Waste removed both PCB-contaminated capacitors and transformers and contaminated soil from the Site for disposal. (See generally Dkt. No. 253-4). Universal Waste entered into a contract with Newco Chemical Waste Systems, Inc. for the transportation and disposal of “[w]astes containing PCB's,” including “capacitors, properly drained transformers, contaminated soil . . . [and] properly drained containers (drums).” (Id. at 8-11).

A straight bill of lading dated November 27, 1979 indicates that Newco transported 22 “PCB Article containers (drums)” weighing 3598.18 kilograms. (Id. at 12-13). An entity called CECOS International Inc. subsequently informed NYSDEC that it “accepted twenty-two (22) drums of PCB material” from Universal Waste at its Niagara Falls site and disposed of the material on December 1, 1979. (Id. at 20).

On November 26, 1979, a representative from the United States Environmental Protection Agency (“EPA”) wrote to a United States Congressman in response to an inquiry concerning the Site. (Id. at 14). The EPA noted that NYSDEC was “aware of the [contamination] problem” and that the “present owners are working with NYSDEC officials in having the contaminated material moved to a secure location.” (Id.). There did “not appear to be a threat to the Mohawk River” or “evidence of leaching or any movement of the contaminated soil.” (Id.).

3. 1980s: Registry Listing, 1982 Agreement, and Clayton Study

In 1980, the full 23-acre Site was listed on the New York State Registry of Inactive Hazardous Waste Disposal Sites (the “Registry”). (Dkt. No. 253-5, at 1-3). The Site was called “Universal Waste, Inc.” and given a site code of 633009. (Id. at 2). NYSDEC noted that its “environmental inspection team d[id] not believe that the Universal Waste site pose[d] an ‘imminent health hazard' to water supplies or the surrounding area” and that remedial action had been “[p]roposed.” (Id. at 3).

In March 1981, counsel for the Companies wrote to NYSDEC “hop[ing]” that NYSDEC was satisfied that “no hazardous waste problem [wa]s presented” by the Site and requesting that the Site be deleted from the Registry. (Dkt. No. 253-6, at 2). Attorney Vincent Rossi represented that the Companies had “never had a disposal site on [the] premises.” (Id.).

In a letter dated January 7, 1982, NYSDEC wrote to Joseph Jiampietro, President of the Companies, stating that the agency was “continuing to investigate the disposal of hazardous or industrial wastes and materials at the approximately 23 acre Universal Waste/Utica Alloys Site.” (Dkt. No. 253-7, at 2). NYSDEC stated that, after its investigation, it would determine “whether any further action should be taken concerning the site.” (Id.). NYSDEC's letter “constitute[d] a formal request” pursuant to New York state law for the Companies to furnish a range of specified documents and records relating to the Site. (Id. at 2-4).

In August 1982, the Companies and NYSDEC entered into an Agreement and Determination (the “1982 Agreement”). (Dkt. No. 253-8). The Companies agreed to conduct a “field investigation” and provide a “field investigation report, with the goal of...