Garrett Day LLC v. Int'l Paper Co.
| Decision Date | 29 February 2016 |
| Docket Number | Case No. 3:15-cv-36 |
| Parties | GARRETT DAY LLC, et al., Plaintiffs, v. INTERNATIONAL PAPER COMPANY, et al., Defendants. |
| Court | U.S. District Court — Southern District of Ohio |
After spending more than $1.7 million to clean up hazardous waste at the site of a former paper mill in Dayton, Plaintiffs Garrett Day LLC, and Ohio Development Services Agency ("ODSA" or "DSA"), filed suit against more than a dozen defendants, seeking cost recovery and/or contribution under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. §§ 9607(a) and 9613(f). Plaintiffs also seek recovery under Ohio's Voluntary Action Program ("VAP"), Ohio Revised Code § 3746.23, and bring a common law nuisance claim.
This matter is currently before the Court on Defendant International Paper Company's ("IPC") Motion to Dismiss, Doc. #75, and a Motion to Dismiss by Defendants Fox Valley Corporation, Fox River Paper Company, Fox River Paper Sales Company (collectively "Fox River"), and Neenah Paper, Inc. ("Neenah Paper"), Doc. #92.
On July 1, 2010, Plaintiff Garrett Day purchased the site of a former paper mill in Dayton, Ohio (the "Site"). At that time, according to the Complaint, "the Site contained structurally unsafe structures, was no longer fit to be habitable, and was a hazard and menace to the public." Doc. #1, PageID#7. Plaintiffs allege that, over the years, numerous hazardous chemicals, used in the paper-making process, were released and/or disposed of at the Site. Asbestos, trichloroethylene ("TCE"), polycyclic aromatic hydrocarbons ("PAHs"), and polychlorinated biphenyls ("PCBs") were found at the Site. Id. at PageID##10-11.
The Complaint alleges that, after purchasing the Site, Garrett Day, in conjunction with ODSA and the City of Dayton, identified potential sources of contamination, investigated the nature and extent of that contamination, prepared a remedial plan, and conducted remedial activities, in accordance with VAP standards and the National Contingency Plan ("NCP"). Plaintiffs allegedly spent more than $1.7 million in connection with these efforts. A "no further action" letter was issued on February 13, 2012, and a Covenant Not to Sue was grantedon July 5, 2012. Id. at PageID##11-13. In 2015, the City of Dayton allegedly assigned to Garrett Day and ODSA all claims related to the Site. Id. at PageID#2.
According to the Complaint, the Site was owned and operated by numerous paper companies from 1896 through 2001, at the time the release of hazardous substances allegedly occurred. Id. at PageID##5-7. Plaintiffs now seek to recover their costs from more than a dozen of those entities or their successors-in-interest. Plaintiffs seek necessary response costs under § 107(a) of CERCLA, contribution under § 113(f) of CERCLA, and/or VAP response costs under Ohio Revised Code § 3746.23. They also assert a common law nuisance claim.
Defendants IPC, Fox River and Neenah Paper are just a few of the entities sued. Plaintiffs maintain that IPC's predecessor companies owned and operated the Site from 1918 through 1972, and that Fox River, Neenah Paper and their predecessor companies owned and operated the Site from 1972 to 1992. Id. at PageID#8. These defendants have filed motions to dismiss under Federal Rule of Civil Procedure 12(b)(6). Docs. ##75, 92.
Federal Rule of Civil Procedure 8(a) provides that a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." The complaint must provide the defendant with "fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).
Federal Rule of Civil Procedure 12(b)(6) allows a party to move for dismissal of a complaint on the basis that it "fail[s] to state a claim upon which relief can be granted." The moving party bears the burden of showing that the opposing party has failed to adequately state a claim for relief. DirecTV, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007) (citing Carver v. Bunch, 946 F.2d 451, 454-55 (6th Cir. 1991)). The purpose of a motion to dismiss under Rule 12(b)(6) "is to allow a defendant to test whether, as a matter of law, the plaintiff is entitled to legal relief even if everything alleged in the complaint is true." Mayer v. Mylod, 988 F.2d 635, 638 (6th Cir. 1993). In ruling on a 12(b)(6) motion, a court must "construe the complaint in the light most favorable to the plaintiff, accept its allegations as true, and draw all reasonable inferences in favor of the plaintiff." Handy-Clay v. City of Memphis, 695 F.3d 531, 538 (6th Cir. 2012) (quoting Treesh, 487 F.3d at 476).
Nevertheless, to survive a motion to dismiss under Rule 12(b)(6), the complaint must contain "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. Unless the facts alleged show that the plaintiff's claim crosses "the line from conceivable to plausible, [the] complaint must be dismissed." Id. Although this standard does not require "detailed factual allegations," it does require more than "labels and conclusions" or "a formulaic recitation of the elements of a cause of action." Id. at 555. "Rule 8 . . . does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions." Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009). Legal conclusions"must be supported by factual allegations" that give rise to an inference that the defendant is, in fact, liable for the misconduct alleged. Id. at 679.
Defendants each argue that Plaintiffs' Complaint is deficient in numerous respects, each warranting dismissal. Before addressing any of the issues raised in connection with Plaintiffs' state law claims, the Court first turns to the federal CERCLA claims.
CERCLA was enacted to promote the timely cleanup of hazardous waste sites and to spread the cost of that cleanup among those responsible for the contamination. Hobart Corp. v. Waste Mgmt. of Ohio, Inc., 758 F.3d 757, 761 (6th Cir. 2014). In this case, Plaintiffs seek recovery of response costs under § 107(a) of CERCLA and/or contribution under § 113(f) of CERCLA.
Under § 107(a), a person who incurs "necessary costs of response . . . consistent with the national contingency plan," 42 U.S.C. § 9607(a)(4)(B), may recover those response costs from other potentially responsible parties. Under § 113(f), a person may seek contribution from other potentially responsible parties if the plaintiff: (1) has been sued under 42 U.S.C. § 9606 or 9607(a), see 42 U.S.C. § 9613(f)(1); or (2) has resolved its liability to the United States or a State through an administrative or judicially approved settlement, see 42 U.S.C. § 9613(f)(3)(B).
"[P]arties seeking contribution under § 113(f) must look to § 107 to establish the basis and elements of the liability of the defendants." Kalamazoo River Study Grp. v. Menasha Corp., 228 F.3d 648, 656 (6th Cir. 2000) (quoting Centerior Serv. Co. v. Acme Scrap Iron & Metal Corp., 153 F.3d 344, 350 (6th Cir. 1998)).
A prima facie case for CERCLA recovery under § 107(a) has four elements: (1) the property is a "facility"; (2) there has been a "release" or "threatened release" of a hazardous substance; (3) the release has caused the plaintiff to incur "necessary costs of response" that are "consistent" with the NCP; and (4) the defendant is in one of four categories of potentially responsible parties.
Reg'l Airport Auth. of Louisville v. LFG, LLC, 460 F.3d 697, 703 (6th Cir. 2006). One of those four categories of potentially responsible parties includes "any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of." 42 U.S.C. § 9607(a)(2).
Here, Plaintiffs allege that hazardous substances were "released and/or disposed of" at the Site during the entire time that the paper mill was operational, from approximately 1918 to as late as 2010. Doc. #1, PageID##11-12. Pursuant to § 9607(a)(2), Plaintiffs seek to recoup $1.7 million in cleanup costs from the entities that owned or operated the paper mill during that time period, or from those entities' successors-in-interest. Defendants argue that, for several reasons, Plaintiffs have failed to state a claim upon which relief can be granted.
As previously noted, CERCLA imposes liability on "any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of." 42 U.S.C. § 9607(a)(2). In their motions to dismiss, Defendants argue that Plaintiffs' Complaint fails to state a viable cause of action under either § 107(a) or § 113(f) of CERCLA, because the factual allegations are insufficient to support a finding that Defendants owned or operated the Site "at the time of disposal of any hazardous substance."
According to Plaintiffs, Defendant IPC and its predecessors owned or operated the paper mill from 1918-1972, and Defendants Fox River, Neenah Paper and their predecessors owned and operated the paper mill from 1972-1992. Doc. #1, PageID#8. Plaintiffs further allege that "[t]hrough paper-making operations, hazardous substances were released and/or disposed of at the Site,"...
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