Itt Indus. Inc v. Borgwarner Inc

• Decision Date: 24 March 2010
• Docket Number: File No. 1:05-CV-674.
• Citation: 700 F.Supp.2d 848
• Parties: ITT INDUSTRIES, INC., Plaintiff,v.BORGWARNER, INC., et al., Defendants.
• Court: U.S. District Court — Western District of Michigan

700 F.Supp.2d 848

ITT INDUSTRIES, INC., Plaintiff,v.BORGWARNER, INC., et al., Defendants.

File No. 1:05-CV-674.

United States District Court,

W.D. Michigan,

Southern Division.

March 24, 2010.

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Scott D. Broekstra, Kimberly Michelle Large, Mika Meyers Beckett & Jones PLC, Grand Rapids, MI, for Plaintiff.

Jeffrey K. Haynes, Beier Howlett PC, Bloomfield Hills, MI, Stephanie Sue Couhig, Stephen Q. Giblin, Jones Day, Cleveland OH, Ryan D. Cobb, U.S. Attorney, Grand Rapids, MI, for Defendants.

OPINION

ROBERT HOLMES BELL, District Judge.

This is an action under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. § 9601 et seq., and Part 201 of the Michigan Natural Resources and Environmental Protection Act (NREPA), Mich. Comp. Laws §§ 324.20101-324.20142, for recovery of response costs at the EPA-regulated North Bronson Industrial Area Superfund site in Bronson, Michigan.

This action was tried to the Court from August 26, 2009, through September 3, 2009. Having carefully considered the testimony, exhibits, deposition excepts, trial briefs, written closing arguments, and proposed findings of fact and conclusions of law, the Court enters this opinion incorporating its findings of fact and conclusions of law in accordance with Rule 52(a) of the Federal Rules of Civil Procedure.

I.

ITT filed this action for cost recovery and contribution in 2005. The parties and claims that remained for trial were the following: ¹

1. Plaintiff ITT Industries Inc.'s (“ITT”) ² claims for cost recovery under CERCLA § 107(a), 42 U.S.C. § 9607(a) and Part 201 of NREPA, Mich. Comp. Laws § 324.20126a, against Royal Oak Industries (“Royal Oak”), The Scott Fetzer Company (“Scott Fetzer”) and L.A. Darling Company (“L.A. Darling”), for costs relating to response actions ITT performed at the former Bronson Reel facility, also known as Operable Unit 1 of the North Bronson Former Facilities Site (“NBFF OU1”). (Dkt. Nos. 88, 114.)

2. Royal Oak's counterclaim against ITT, cross-claim against Scott Fetzer and third-party claim against L.A. Darling for contribution under CERCLA § 113, 42 U.S.C. § 9613 and Part 201 of NREPA, should Royal Oak be found liable for more than its fair and equitable share of ITT's costs relating to NBFF OU1. (Dkt. No. 96.)

3. Scott Fetzer's counterclaim against ITT, cross-claim against Royal Oak, and third-party claim against L.A. Darling for contribution under CERCLA § 113, and Part 201 of NREPA, should Scott Fetzer be found liable for more than its fair and equitable share of ITT's costs relating to NBFF OU1. (Dkt. No. 112.)

4. L.A. Darling's counterclaim against ITT for contribution under CERCLA § 113, and Part 201 of NREPA, should L.A. Darling be found liable for more than its fair and equitable share of ITT's costs relating to NBFF OU1. (Dkt. No. 151.)

II.

Resolution of these claims requires an understanding of the historical efforts to address industrial wastes and environmental contamination in the City of Bronson, in Branch County, Michigan.

Beginning in the early 1900s, as manufacturing operations began to develop in the North Bronson Industrial Area (“NBIA”), companies discharged wastewater to County Drain 30 (“CD-30”). (FPT F-8.) In response to concerns about the water quality in CD-30, the City of Bronson built an industrial sewer system with lagoons. (FPT-F9.) ³ Between 1939 and 1949, the Bronson Reel Company (“Bronson Reel”), H.A. Douglas Manufacturing Company, (“H.A. Douglas”) (the former Scott Fetzer facility) and L.A. Darling all discharged wastewater to these western lagoons via the western industrial sewer. (FPT F-10.)

By 1948, the western lagoons were reaching capacity, and the City of Bronson constructed new lagoons located in the northeast corner of the NBIA, which were commonly referred to as the eastern lagoons. (FPT F-11.) In 1949, the western industrial sewer overflowed in several areas along Railroad Street, causing storm sewer infiltration of wastewater. (Stephens Test.; Exs. 6052, 6053). Beginning in 1949, wastewater from the former Scott Fetzer and L.A. Darling sites was re-directed to the new eastern lagoons via the eastern industrial sewer which ran north along Matteson Street. The Bronson Reel facility continued to discharge wastewater to the western lagoons via the western industrial sewer. (FPT F-12, F-68, F-58, F-59.)

In 1979, the Michigan Department of Natural Resources (“MDNR” n/k/a Michigan Department of Environmental Quality “MDEQ”) detected trichloroethylene ⁴ (“TCE”) in groundwater samples from six monitoring wells in the vicinity of the western disposal lagoons in northwest Bronson. (FPT F-1.) TCE is commonly used as an industrial solvent for cleaning and degreasing and was likely in the waste streams of facilities which discharged to the eastern and western-lagoons. (Ex. 5004, Warzyn RI, iii.)

In 1986, the U.S. Environmental Protection Agency (“EPA”) included the NBIA on the National Priorities List for investigation and potential remediation of hazardous wastes under CERCLA. (Ex. 5004, Warzyn RI 2-1). The NBIA site covers approximately 220 acres, and is currently comprised of two operable units (“OUs”):

• NBIA OU1 includes the western and eastern industrial wastewater lagoons, sediments, and portions of CD-30, groundwater impacted by the lagoons discharging to CD-30, and exposure to groundwater throughout the NBIA site.

• NBIA OU2 includes the western and eastern industrial sewers and groundwater impacted by releases from the industrial sewers. (FPT F-2.)

The MDNR retained Warzyn Inc. to conduct a Remedial Investigation (“RI”-of the NBIA.) (Ex. 5004, Warzyn RI 1-1.) Warzyn conducted its field activities in 1988-1989, and filed its Remedial Investigation in 1993. The predominant contaminants found by Warzyn at the NBIA site were chlorinated ethene compounds, including TCE, and metals, including cadmium, chromium, copper, nickel, and zinc. ( Id. at ii-iii.) The Warzyn RI found high concentrations of TCE in soil and groundwater at the L.A. Darling site and the Scott Fetzer site. ( Id. at 5-38). TCE concentrations of 2,700 ug/L were found at MW21 on the L.A. Darling Site ( id. at 5-21), and TCE concentrations of 30,000 ug/L were found at MW20 on the Scott Fetzer site ( id. at 5-29). The Warzyn RI identified a regional groundwater plume of volatile organic compounds (“VOCs”), including TCE, and identified the L.A. Darling Sub-Area and the Scott Fetzer Sub-Area as potential sources of the TCE. ( Id. at ii-iii.)

In 1996 and 1998 the MDEQ conducted field investigations regarding NBIA OU2, the industrial sewers. (Dkt. No. 6008, MDEQ NBIA OU2 Tech. Memo at 3.) Both VOCs and metals were found to be migrating in the groundwater. However, the contaminant of greatest concern to the EPA and the MDEQ was TCE. “Because of the relatively low mobility of metals in groundwater, the risk associated with metals is believed to be minimal when compared to the mobility and risk associated with the VOCs.” ( Id. at 9.) TCE, which was the most frequently reported VOC, was detected in fifty-eight of sixty-nine groundwater samples. ( Id. at 5-6.) At L.A. Darling, TCE was detected in all seven groundwater samples, with the highest level at 28,000 ppb. ( Id. at 10.) At Scott Fetzer TCE was detected in numerous groundwater samples, with the highest level at 21,000 ppb. ( Id. at 11.) TCE was also detected in groundwater samples from three locations north and down gradient of Bronson Reel, in close proximity to the industrial sewer line (GPW4, GPW5, and GPW6), with the highest concentration of 3,900 g/kg detected at GPW4. (Ex. 6008 at 7; Ex. 1423, Map of Sample Locations Prior to SRI.) According to the MDEQ, the source of the TCE in the samples down gradient of Bronson Reel “may have been handling or disposal practices at the [Bronson Reel] facility, or releases from the industrial sewer.” (Ex. 6008 at 11.) The MDEQ concluded that the industrial sewer, portions of the storm sewer, L.A. Darling, Scott Fetzer and Bronson Reel, appeared to be source areas of environmental contamination at the NBIA. ( Id. at 10-11.)

In March of 1999, ITT, Scott Fetzer, L.A. Darling, Bronson Plating and the City of Bronson, all of which were associated with facilities that had historically discharged industrial waste water into the NBIA sewers and lagoons, entered into a Consent Decree with EPA regarding response activities and costs incurred with respect to the NBIA. (FPT F-3.) On September 27, 2000, the EPA issued a Special Notice Letter to ITT, Scott Fetzer and L.A. Darling with respect to the industrial sewers, NBIA OU2. (FPT-F38.) The primary goal of the NBIA OU2 Special Notice was to investigate regional groundwater impacted by VOCs (primarily TCE) originating from the industrial sewer. (Olmsted Test.) The EPA entered into negotiations with the three Special Notice recipients. Teresa Olmsted, Director of Environmental Programs at ITT, personally attended the meetings with the EPA regarding the NBIA OU2 Special Notice. Olmsted explained that the parties' discussions with the EPA centered on the difficulty of determining what VOCs were originating from the industrial sewer rather than from the facilities because the L.A. Darling and Scott Fetzer former facilities had not yet been investigated. (Olmsted Test.) During these discussions it was suggested that addressing the facility sources could identify the most significant sources to the regional plume, could limit the investigation of the industrial sewer, or could make the sewer investigation moot if the facilities were the primary sources. (Olmsted Test.) By letter dated March 8, 2001, the EPA agreed that it was critical to develop a strategy for dealing not only with the industrial sewers but with the upstream sources as well. It accordingly allowed the three Special Notice recipients to choose between...