Refined Metals Corp. v. NL Indus., Inc.
| Decision Date | 25 March 2020 |
| Docket Number | No. 1:19-cv-4578-JMS-DLP,1:19-cv-4578-JMS-DLP |
| Parties | REFINED METALS CORPORATION, Plaintiff, v. NL INDUSTRIES, INC., Defendant. |
| Court | U.S. District Court — Southern District of Indiana |
In this action, Plaintiff Refined Metals Corporation ("Refined Metals") seeks payment and a declaratory judgment pursuant to the Indiana Environmental Legal Action statute ("ELA") from Defendant NL Industries, Inc. ("NL") to help cover the costs of the cleanup of hazardous substances on a property sold by NL to Refined Metals and used by both entities to operate a lead smelting facility. NL has filed a Motion to Dismiss based on the statute of limitations, which is now ripe for the Court's decision. [Filing No. 8.]
I.
STANDARD OF REVIEW
The Federal Rules of Civil Procedure require only a "short and plain statement of the claim showing that the pleader is entitled to relief." Erickson v. Pardus, 551 U.S. 89, 93 (2007) (quoting Fed. R. Civ. P. 8(a)(2)). To that end, the complaint need only provide the defendant with "fair notice of what the . . . claim is and the grounds upon which it rests." Erickson, 551 U.S. at 93 (quoting Bell Atlantic v. Twombly, 550 U.S. 544, 555 (2007)) (internal quotation marks omitted). In order to survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the complaint must contain allegations that collectively "state a claim to relief that is plausible on its face." Id. (internal quotations omitted) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). In reviewing the sufficiency of a complaint, the Court must accept all well-pled facts as true and draw all permissible inferences in favor of the plaintiff. Alarm Detection Sys., Inc. v. Vill. of Schaumburg, 930 F.3d 812, 821 (7th Cir. 2019). This review is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Munson v. Gaetz, 673 F.3d 630, 633 (7th Cir. 2012).
A plaintiff is not required to plead facts that overcome affirmative defenses based on the statute of limitations. NewSpin Sports, LLC v. Arrow Elecs., Inc., 910 F.3d 293, 299 (7th Cir. 2018). Accordingly, dismissing a complaint as untimely based on the pleadings is disfavored, as a statute of limitations defense generally turns on facts not before the Court at this stage. See Sidney Hillman Health Ctr. of Rochester v. Abbott Labs., Inc., 782 F.3d 922, 928 (7th Cir. 2015) (citations omitted). Nevertheless, if the complaint and the supporting documents contain all of the elements of a statute of limitations defense, dismissal under Rule 12(b)(6) is proper. Indep. Tr. Corp. v. Stewart Info. Servs. Corp., 665 F.3d 930, 935 (7th Cir. 2012); see also Williamson v. Curran, 714 F.3d 432, 436 (7th Cir. 2013) ().
II.
BACKGROUND
Refined Metals initially filed its Complaint in the Marion County, Indiana Superior Court, and NL removed the action to this Court based on diversity jurisdiction.1 [Filing No. 1.] The following facts from Refined Metals' Complaint are accepted as true for purposes of deciding the Motion to Dismiss, consistent with the standard of review outlined above. Where appropriate, facts from the documents referenced in the Complaint or documents subject to judicial notice are also included, as Refined Metals agrees that such documents may be properly considered in ruling on the Motion to Dismiss. [Filing No. 16 at 20]; Williamson, 714 F.3d at 436.
NL, or one of its predecessors, acquired a property located at 3700 South Arlington Avenue in Beech Grove, Indiana ("the Property") in or around 1966. [Filing No. 1-2 at 1.] NL owned the Property from 1966 until 1980 and, during that time, built a lead smelting plant ("the Facility") on the Property. [Filing No. 1-2 at 1.] The Facility produced lead alloys by smelting spent lead materials in a furnace and then adding other materials to the recycled lead, a process known as "refining." [Filing No. 1-2 at 1.] In 1980, NL sold the Property to Refined Metals. [Filing No. 1-2 at 2.] Refined Metals operated the Facility, smelting secondary lead materials into lead andproducing refined lead alloys, from 1980 until 1995. [Filing No. 1-2 at 2.] Refined Metals continued to own the Property until 2017. [Filing No. 1-2 at 2.]
Beginning in the late 1970s, the federal government, through the Environmental Protection Agency ("EPA") and the Occupational Safety and Health Administration of the Department of Labor, promulgated environmental regulations governing lead emissions and wastewater discharges of pollutants from secondary lead manufacturing operations, such as those conducted at the Facility. [Filing No. 1-2 at 2-3.] The State of Indiana, through the Indiana Department Environmental Management ("IDEM"), also adopted regulations concerning lead emissions during the same period. [Filing No. 1-2 at 2.]
In 1990, the EPA filed a lawsuit against Refined Metals, alleging that Refined Metals violated the Resource Conservation and Recovery Act and the Clean Air Act in its operation of the Facility, and the IDEM intervened as a plaintiff. [Filing No. 8-5 at 5.] In 1998, Refined Metals, the EPA, and the IDEM entered into a Consent Decree that provided for remedial actions to be taken by Refined Metals to address the release of hazardous substances resulting from operation of the Facility and to remove soil that had been contaminated with lead. [Filing No. 1-2 at 3-4; see also Filing No. 8-5.]
Refined Metals alleges that NL's previous operation of the Facility, as well as its initial design and construction of the Facility, contributed to the release of hazardous substances to the surface and subsurface soils on the Property, which posed a risk to human health and to the environment that endured after the sale of the Property. [Filing No. 1-2 at 5.] Therefore, Refined Metals seeks: (1) the costs of remedial actions to address the hazardous substances released at the Facility, to the extent such costs are recoverable under the ELA; and (2) a declaratory judgment declaring that NL is responsible for the environmental cleanup costs incurred and that NL mustindemnify or make contribution to any future costs incurred by Refined Metals in connection with cleaning up contamination on the Property. [Filing No. 1-2 at 5-6.]
On July 28, 2017, Refined Metals filed a complaint in this Court ("the first lawsuit"), alleging that it was entitled to recover environmental cleanup costs from NL under the federal Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") and under the ELA. [Filing No. 1 in Case No. 1:17-cv-02565-SEB-TAB.] NL moved to dismiss Refined Metals' claims, and the Court granted the motion. [Filing No. 8-3 at 2]; Refined Metals Corp. v. NL Indus., Inc. ("Refined I"), 2018 WL 4592110, at *1 (S.D. Ind. Sept. 25, 2018). Specifically, the Court concluded that the CERCLA claims were untimely, because the applicable three-year statute of limitations began to run upon the entry of the Consent Decree in 1998 and expired in 2001, long before the action was filed. [Filing No. 8-3 at 14-16]; Refined I, 2018 WL 4592110, at *6. As to the ELA claims, the Court first concluded that Refined Metals had not properly pled the existence of diversity jurisdiction, and therefore the only remaining basis for jurisdiction over the ELA claims was supplemental jurisdiction. [Filing No. 8-3 at 17-18]; Refined I, 2018 WL 4592110, at *7. The Court then concluded that it was appropriate to relinquish supplemental jurisdiction over the state law ELA claim and dismiss it without prejudice, relying in part on the fact that, due to conflicting state law precedent concerning the ELA's statute of limitations, it was "not at all obvious how the state-law claims should be decided." [Filing No. 8-3 at 18-19]; Refined I, 2018 WL 4592110, at *7-8.
The Seventh Circuit Court of Appeals affirmed this Court's dismissal of the action, agreeing that Refined Metals' CERCLA claims were untimely. [Filing No. 8-4 at 2-14]; Refined Metals Corp. v. NL Indus. Inc. ("Refined II"), 937 F.3d 928, 929-30 (7th Cir. 2019). The Court ofAppeals further concluded that Refined Metals had waived any argument that this Court had erred in finding that diversity jurisdiction was not properly pled or abused its discretion in relinquishing supplemental jurisdiction over the ELA claim. [Filing No. 8-4 at 15-16]; Refined II, 937 F.3d at 935-36.
III.
DISCUSSION
The Court notes at the outset that, because all of the relevant dates are contained within the Complaint or the other documents that the Court may consider at this stage, this is the kind of case that it susceptible to a statute of limitations analysis at the motion to dismiss stage. Indeed, the dispute over which statute of limitations applies to the facts as they are alleged is a legal one.
"Congress enacted CERCLA in 1980 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." CTS Corp. v. Waldburger, 573 U.S. 1, 4 (2014) (internal quotations and citations omitted). CERCLA provides for "cost recovery" actions and two different types of "contribution" actions. See, e.g., Bernstein v. Bankert, 733 F.3d 190, 200-03 (7th Cir. 2013). Where a party has been subjected to a civil lawsuit, or resolved its liability to the United...
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