PCS Nitrogen Inc. v. Ashley II of Charleston LLC

• Decision Date: 04 April 2013
• Docket Number: 11–2087,11–2297.,11–2099,Nos. 11–1662,11–2104,s. 11–1662
• Citation: 714 F.3d 161
• Parties: PCS NITROGEN INCORPORATED, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellant, v. ASHLEY II OF CHARLESTON LLC, Plaintiff–Appellee, Ross Development Corporation; J Holcombe Enterprises LP; Koninklijke DSM NV; DSM Chemicals of North America Incorporated; Robin Hood Container Express Incorporated; All Waste Tank Cleaning Incorporated, f/k/a PSC Container Services, LLC, now known as QualaServices, LLC; J Henry Fair, Jr., Third Party Defendants–Appellees, and James H. Holcombe; City of Charleston, South Carolina, Third Party Defendants. Ross Development Corporation, Third Party Defendant–Appellant, v. PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee, and Ashley II of Charleston LLC, Plaintiff, J Holcombe Enterprises LP; Koninklijke DSM NV; Robin Hood Container Express Incorporated; DSM Chemicals of North America Incorporated; All Waste Tank Cleaning Incorporated; J Henry Fair, Jr.; City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants, PSC Container Services LLC, Defendant. Robin Hood Container Express Incorporated, Third Party Defendant–Appellant, v. PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee, Ashley II of Charleston LLC, Plaintiff–Appellee, Ross Development Corporation; J Holcombe Enterprises LP; Koninklijke DSM NV; DSM Chemicals of North America Incorporated; All Waste Tank Cleaning Incorporated; J Henry Fair, Jr., Third Party Defendants–Appellees, and City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants, PSC Container Services LLC, Defendant. J Holcombe Enterprises LP; J Henry Fair, Jr., Third Party Defendants–Appellants, v. PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee, Ashley II of Charleston LLC, Plaintiff–Appellee, Robin Hood Container Express Incorporated; Ross Development Corporation; Koninklijke DSM NV; DSM Chemicals of North America Inc orporated; All Waste Tank Cleaning Incorporated, Third Party Defendants–Appellees, and City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants, PSC Container Services LLC, Defendant. Ashley II of Charleston LLC, Plaintiff–Appellant, v. PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee, Robin Hood Container Express Incorporated; Ross Development Corporation; Koninklijke DSM NV; DSM Chemicals of North America Inc orporated; All Waste Tank Cleaning Incorporated; J Holcombe Enterprises LP; J Henry Fair, Jr., Third Party Defendants–Appellees, and City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants, PSC Container Services LLC, Defendant.
• Court: U.S. Court of Appeals — Fourth Circuit

714 F.3d 161

PCS NITROGEN INCORPORATED, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellant,

v.ASHLEY II OF CHARLESTON LLC, Plaintiff–Appellee,Ross Development Corporation; J Holcombe Enterprises LP; Koninklijke DSM NV; DSM Chemicals of North America Incorporated; Robin Hood Container Express Incorporated; All Waste Tank Cleaning Incorporated, f/k/a PSC Container Services, LLC, now known as QualaServices, LLC; J Henry Fair, Jr., Third Party Defendants–Appellees,andJames H. Holcombe; City of Charleston, South Carolina, Third Party Defendants.

Ross Development Corporation, Third Party Defendant–Appellant,

v.PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee,andAshley II of Charleston LLC, Plaintiff,J Holcombe Enterprises LP; Koninklijke DSM NV; Robin Hood Container Express Incorporated; DSM Chemicals of North America Incorporated; All Waste Tank Cleaning Incorporated; J Henry Fair, Jr.; City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants,

PSC Container Services LLC, Defendant.

Robin Hood Container Express Incorporated, Third Party Defendant–Appellant,

v.PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee,Ashley II of Charleston LLC, Plaintiff–Appellee,Ross Development Corporation; J Holcombe Enterprises LP; Koninklijke DSM NV; DSM Chemicals of North America Incorporated; All Waste Tank Cleaning Incorporated; J Henry Fair, Jr., Third Party Defendants–Appellees,

and

City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants,

PSC Container Services LLC, Defendant.

J Holcombe Enterprises LP; J Henry Fair, Jr., Third Party Defendants–Appellants,

v.PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee,Ashley II of Charleston LLC, Plaintiff–Appellee,Robin Hood Container Express Incorporated; Ross Development Corporation; Koninklijke DSM NV; DSM Chemicals of North America Inc orporated; All Waste Tank Cleaning Incorporated, Third Party Defendants–Appellees,

and

City of Charleston, South Carolina; James H. Holcombe, Third Party Defendants,

PSC Container Services LLC, Defendant.

Ashley II of Charleston LLC, Plaintiff–Appellant,

v.PCS Nitrogen Incorporated, successor through purchase, name change and merger to Columbia Nitrogen Corporation, Defendant and Third Party Plaintiff–Appellee,Robin Hood Container Express Incorporated; Ross Development Corporation; Koninklijke DSM NV; DSM Chemicals of North America Inc orporated; All Waste Tank Cleaning Incorporated; J Holcombe Enterprises LP; J Henry Fair, Jr., Third Party Defendants–Appellees,andCity of Charleston, South Carolina; James H. Holcombe, Third Party Defendants,

PSC Container Services LLC, Defendant.

Nos. 11–1662, 11–2087, 11–2099, 11–2104, 11–2297.

United States Court of Appeals,Fourth Circuit.

Argued: Dec. 5, 2012.

Decided: April 4, 2013.

ARGUED:Brian J. Murray, Jones Day, Chicago, Illinois, for PCS Nitrogen Incorporated. Thomas Nolen Barefoot, Bethesda, Maryland, for Ashley II of Charleston LLC; Capers Gamewell Barr, III, Barr, Unger & McIntosh, Charleston, South Carolina, for J. Holcombe Enterprises LP and J. Henry Fair, Jr.; Daniel S. McQueeney, Jr., Pratt–Thomas Walker, PA, Charleston, South Carolina, for Ross Development Corporation; Timothy William Bouch, Leath, Bouch & Crawford, LLP, Charleston, South Carolina, for Robin Hood Container Express, Incorporated; Lewis Bondurant Jones, King & Spalding, LLP, Atlanta, Georgia, for Koninklijke DSM NV and DSM Chemicals of North America, Incorporated. Jason Scott Luck, Seibels Law Firm, PA, Charleston, South Carolina, for Allwaste Tank Cleaning, Incorporated. ON BRIEF:John B. Williams, Cozen O'Connor, Washington, D.C.; Jennifer L. Swize, Craig I. Chosiad, Jones Day, Washington, D.C., for PCS Nitrogen Incorporated. G. Trenholm Walker, Pratt–Thomas Walker, PA, Charleston, South Carolina; Thomas M. Shelley, III, Rogers, Townsend & Thomas, PC, Columbia, South Carolina, for Ross Development Corporation. Amy E. Melvin, Leath, Bouch & Seekings, LLP, Charleston, South Carolina, for Robin Hood Container Express, Incorporated. Randall J. Butterfield, John L. Fortuna, King & Spalding LLP, Atlanta, Georgia, for Koninklijke DSM NV and DSM Chemicals of North America, Incorporated.

Before MOTZ, KING, and DIAZ, Circuit Judges.

Affirmed by published opinion. Judge MOTZ wrote the opinion, in which Judge KING and Judge DIAZ joined.

OPINION

DIANA GRIBBON MOTZ, Circuit Judge:

These appeals arise from disputes as to liability for cleanup of hazardous substances at a former fertilizer manufacturing site in Charleston, South Carolina. After incurring response costs, Ashley II of Charleston, Inc., the current owner of a portion of the site, brought a cost recovery action against PCS Nitrogen, Inc., under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. §§ 9601–9675 (2006). PCS counterclaimed and also brought third-party contribution actions against parties with past and current connections to the site. The district court bifurcated the case for trial. At the conclusion of the first bench trial, it found PCS a potentially responsible party jointly and severally liable for response costs at the site. At the conclusion of the second bench trial, the court found some of the other parties, including Ashley, potentially responsible parties, each liable for an allocated portion of the site's response costs. PCS, Ashley, and many of the other parties now appeal. For the reasons that follow, we affirm the judgment of the district court in all respects.

I.

A.

Congress enacted CERCLA in response to “the increasing environmental and health problems associated with inactive hazardous waste sites.” Nurad, Inc. v. William E. Hooper & Sons Co., 966 F.2d 837, 841 (4th Cir.1992). CERCLA “was designed to promote the timely cleanup of hazardous waste sites and to ensure that the costs of such cleanup efforts were borne by those responsible for the contamination.” Burlington N. & Santa Fe Ry. Co. v. United States, 556 U.S. 599, 602, 129 S.Ct. 1870, 173 L.Ed.2d 812 (2009) (internal quotation marks omitted).

In furtherance of these goals, CERCLA allows “private parties to recover the costs of cleaning up hazardous wastes from certain defined types of person.” Axel Johnson, Inc. v. Carroll Carolina Oil Co., 191 F.3d 409, 413 (4th Cir.1999). A private-party plaintiff establishes a prima facie case for cost recovery under CERCLA by establishing that (1) the defendant is a potentially responsible person (“PRP”); (2) the site constitutes a “facility”; (3) a “release” or a threatened release of hazardous substances exists at the “facility”; (4) the plaintiff has incurred costs responding to the release or threatened release of hazardous substances (“response costs”); and (5) the response costs conform to the National Contingency Plan. 42 U.S.C. §§ 9601(9), (22), 9607(a); see ABB Indus. Sys., Inc. v. Prime Tech., Inc., 120 F.3d 351, 356 (2d Cir.1997).

Section 9607(a) establishes strict liability. See United States v. Monsanto Co., 858 F.2d 160, 167 (4th Cir.1988). This liability under CERCLA is subject only to a few narrow defenses and exemptions. See42 U.S.C. § 9607(b) (defenses); id. § 9607( o)-(r) (exemptions). Liability is, by default, joint and several. See Monsanto, 858 F.2d at 171–72.

However, in some circumstances a PRP may mitigate the sting of CERCLA's imposition of joint and several liability by apportionment or allocation of harm. See Axel Johnson, 191 F.3d at 413. Apportionment—also known as division of damages—assigns a several share of liability to each PRP based on “traditional and evolving principles of federal common law.” Monsanto, 858 F.2d at 171–72. Under these principles, apportionment is available only when a PRP proves that “there is a reasonable basis for determining the contribution of each cause to a single harm.” Burlington Northern, 556 U.S. at 614, 129 S.Ct. 1870 (quoting Restatement (Second) of Torts § 433A(1)(b) (1963–64)).

In contrast, allocation of harm—also known as contribution—is available to any party sued under § 9607(a), and allows the party to “seek contribution from any other person who is liable or potentially liable under [§ ] 9607(a).” 42 U.S.C. § 9613(f). The district court may then allocate several liability for “response costs among liable parties using such equitable factors as the court determines are appropriate.” Id.; see Minyard Enters., Inc. v. Se. Chem. & Solvent Co., 184 F.3d 373, 385 (4th Cir.1999). ¹

B.

Central to this CERCLA case is the history of the site at issue here—approximately forty-three acres located in Charleston, South Carolina. As a result of decades of phosphate fertilizer production, the westernmost thirty-four acres of the site require remediation of soils contaminated with arsenic, lead, and other hazardous substances. The evidence presented at the two bench trials established the following facts.

1.

From 1884 to the early 1900s, seven phosphate fertilizer plants operated in close proximity to the site and provided potential sources for pyrite waste that may have been disposed of on the site prior to 1906.

Planters Fertilizer & Phosphate Company, now known as Ross Development Corporation, purchased the site in 1906. Planters manufactured phosphate fertilizer at the site by reacting sulfuric acid with phosphate rock. Planters produced the sulfuric acid for the process on-site, and stored the acid in lead-lined tanks. Prior to the 1930s, Planters used pyrite ore as the primary fuel for its sulfuric acid production. The burning of pyrite ore generated a pyrite slag byproduct containing high concentrations of arsenic and lead....