Sealy Connecticut, Inc. v. Litton Industries, Inc.

• Decision Date: 09 February 2000
• Docket Number: No. 3:94CV711(JBA).,3:94CV711(JBA).
• Citation: 93 F.Supp.2d 177
• Court: U.S. District Court — District of Connecticut
• Parties: SEALY CONNECTICUT, INC., v. LITTON INDUSTRIES, INC. et al.

Page 177

93 F.Supp.2d 177

SEALY CONNECTICUT, INC., v. LITTON INDUSTRIES, INC. et al.

No. 3:94CV711(JBA).

United States District Court, D. Connecticut.

February 9, 2000.

COPYRIGHT MATERIAL OMITTED

Franca L. Derosa, Brown, Rudnick, Freed & Gesmer, Hartford, CT, for Sealy Connecticut, Inc.

Thomas J. Byrne, Thomas A. Rouse, Brian C. Roche, Pullman & Comley, Bridgeport, CT, Lawrence J. golden, pullman & Comley, Hartford, CT, for Litton Industries, Inc., Litton Systems, Inc.

Sharon A. Cregeen, David J. McDonald, Westport, CT, James Edward O'Donnell, O'Donnell, McDonald & Cregeen, Westport, CT, for U.S. Baird Corp.

James G. Green, Jr., R. Bradley Norris, Pepe & Hazard, Hartford, CT, Luigi D. Vissicchio, Geoffrey W. Millsom, William Charron, Orrick, Herrington & Sutcliffe, New York City, for American Home Products Corp.

Memorandum of Decision-Phase I

ARTERTON, District Judge.

Plaintiff Sealy Connecticut, Inc. ("Sealy") has brought suit to recover its remediation costs under Section 107¹ of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9607(a) ("CERCLA"), the Resource Conservation and Recovery Act, 42 U.S.C. § 6972(a)(1)(A), (a)(1)(B) and invokes supplemental jurisdiction over its state law claims² including Conn.Gen.Stat. § 22a-452. It seeks to recover its cost of remediating the soil and groundwater contamination on a part of the real property it owns in Watertown, Connecticut (the "Winchester Site"). The defendants, Litton Industries, Inc.; Litton Systems, Inc. d/b/a Winchester Electronics, Division of Litton Systems, Inc.; U.S. Baird Corporation f/k/a the Baird Machine Company; and American Home Products Corporation, are each alleged to have formerly owned, operated and/or controlled industrial facilities on the site whose operations are alleged to have resulted in the present contamination.

With agreement of the parties, the Court bifurcated this case to consider in Phase I the sole issue of "what portion of Sealy's remediation costs [to date and in the future] would be recoverable under CERCLA and the analogous provisions of Conn.Gen.Stat. § 22a-452." See Scheduling Order, dated Dec. 21, 1998 (Doc. # 144); Status Report on Scheduling Conference and Parties' Proposal Regarding Bifurcation of Trial, (Doc. # 142). For purposes of the Phase I trial only, the Court assumes CERCLA and Conn.Gen. Stat. § 22a-452 liability, and defers resolution of all other issues "including liability, apportionment of remediation costs between the parties under CERCLA, and Conn.Gen.Stat. § 22a-452, Sealy's other claims of non-remedial damages and any defense which may be asserted." Id. at 2, to Phase II.

This memorandum of decision contains the Court's findings of fact and conclusions of law based on the evidence presented at the Phase I bench trial completed on May 25, 1999.

Site Description and Chronology of Remedial Actions

Plaintiff Sealy owns the Winchester Site which is located at the intersection of Riverside Street and Hillside Avenue in the village of Oakville in the town of Watertown, Connecticut. Sealy also owns a five-acre parcel of real estate adjacent to the Winchester Site where Sealy previously assembled mattresses ("Sealy Site"). Since the late nineteenth century, various manufacturing activities have been performed by various owners, tenants and occupiers of the Winchester Site. See Former Winchester Facility Chronology Study (Pl.'s Ex. 177). Most recently the Winchester Site served as the location of Litton's Winchester Electronics manufacturing facility until Litton closed its operations after its lease with Sealy expired in July 1991. Since the time Litton vacated, the Winchester Site has remained vacant. Until late 1997, the Winchester Site contained an industrial building ("Winchester Building") comprised of a series of structures of varying ages, heights and construction materials reflecting the various industrial uses conducted on the site since 1905. See Abram Test. Tr. at 26.

In December 1986, when Sealy took title to the site, Sealy filed a "Form III"³ declaration with the Connecticut Department of Environmental Protection ("DEP") under the Connecticut Transfer Act, Conn. Gen.Stat. § 22a-134 et seq., ("Transfer Act") based on its belief that there might be hazardous waste at the Winchester Site given its prior uses and thus it could not in good faith file a "Form I" statement attesting to the absence of contamination or a "Form II" statement that remediation had already occurred and was complete. Subsequently, Sealy filed additional "Form III" declarations with the DEP in 1991, 1993 and 1997 triggered by changes in its stock ownership and a series of corporate reorganizations.

In October 1990, Sealy retained Dames & Moore, an environmental consulting firm, to conduct a Phase I Environmental Site Assessment of the Winchester Site. (Pl.'s Ex. 4.) From March through June 1991, Sealy retained TRC Environmental Consultants, Inc. ("TRC,") to prepare the Winchester Site foreclosure upon lease expiration. (Pl.'s Ex. 21.) In October 1992, the DEP conducted an unannounced inspection of the Winchester Site. In November 1992, Dames & Moore performed further site investigation of the Winchester Site. In January 1993, the United States Environmental Protection Agency ("EPA") contacted Sealy to conduct a site inspection of the Winchester Site by an outside inspector, Roy F. Weston. In February 1993, Dames & Moore provided Sealy with a Phase I Environmental Site Assessment, (Pl.'s Ex. 34), and Subsurface Investigation Report (Pl.'s Ex. 35). The Dames & Moore Subsurface Investigation Report indicated the presence of contaminants in the soil and ground water. In June 1993, DEP issued Sealy a Notice of Violation of the Winchester Site based on its October 1992 inspection and report and advised Sealy that "in the event Winchester does not address this waste, enforcement action may be taken against Sealy since they are the landowner." (Pl.'s Ex. 38).

In November 1993, Dames & Moore conducted additional onsite sampling whose preliminary results revealed further contamination of the soil beneath the concrete floor of the Winchester Building. In early 1994, the EPA designated CDM Federal Programs Corp. ("CDM") as the contractor to inspect the Winchester Site under the EPA's CERCLA program. On April 29, 1994, Sealy commenced this action against the Defendants and served copies of the complaint on the EPA and DEP.

In May 1994, CDM inspected the Winchester Site and in August 1994, notified Sealy of its intent to conduct further investigation, including soil sampling. In September 1994, Sealy and Defendants agreed to have Tighe & Bond, another environmental consultant, proceed with a limited site assessment and thus the EPA agreed not to proceed with CDM's investigation pending the results of Tighe & Bond's investigation. In November 1994, Tighe & Bond issued its report entitled, "Additional Site Assessment Investigation Report" which revealed evidence of soil contamination of heavy metals, such as cadmium, chromium, copper, lead, nickel, zinc and cyanide, etc., and total petroleum hydrocarbons ("TPH"). (Pl.'s Ex. 125.) In December 1994, Sealy retained Fletcher Thompson, Inc. ("Fletcher Thompson") to perform a historical study of the Winchester Site and chronology of the construction and manufacturing activities which had taken place on the site since 1905. In January 1995, Tighe & Bond proposed performing additional work at the Winchester Site to characterize the extent of contamination uncovered in its previous investigation and in April 1995, and revised its supplemental investigation plan to incorporate suggestions made by Dames and Moore and the DEP. At this point, the Defendants advised Sealy that they would not agree to implementation of the Tighe & Bond Supplemental Investigation plan. In May 1995, Sealy engaged environmental consultant, ABB Environmental Services, Inc. ("ABB"), with EPA's permission, to undertake the activities proposed by the Tighe & Bond Supplemental Investigation. Also in May, Fletcher Thompson completed at Sealy's request its "Former Winchester Facility Chronology Study for the Winchester Site." See Pl.'s Ex. 177. In July 1995, ABB concluded its additional investigation and reported its findings of further evidence of heavy metal contamination and volatile organic compounds ("VOC"). See Pl.'s Ex. 187. In September 1995, ABB prepared a remedial Action Plan ("September RAP") for the Winchester Site based on all prior investigations conducted by Dames & Moore, Tighe & Bond and ABB. See Pl.'s Ex. 205.

On November 22, 1995, Sealy contracted to sell the Winchester Site to Devlom, a private developer. Under the terms of the sale contract, Devlom would demolish the Winchester Building at its own expense and Sealy would remediate the contamination. In December 1995, CDM issued its final report on the Winchester Site, see Pl.'s Ex. 234, and thereafter EPA notified Sealy that the Winchester Site would not be listed on the National Priorities List as a superfund site and the EPA would defer to the DEP's jurisdiction over the site.

In January 1996, the DEP finalized its Remediation Standard Regulations, Conn.Agencies Regs. § 22a-133k-1, et seq. ("RSRs"). See Defs.' Exs. 406, 407. In January 1996, Sealy and Devlom met with the DEP to discuss the plans for remediation and redevelopment of the Winchester Site. During the next several months, the September RAP was distributed to and commented on by the DEP and Defendants, and was subsequently revised in a document entitled the remediation Plan of April 1996 ("April RAP"). See Pl.'s Ex. 268. As of April 1996, the known site contaminants were principally heavy metals (arsenic, cadmium, chromium, lead, cyanide) and TPH. Although some polynuclear aromatic hydrocarbons (PAH, a volatile organic compound) was detected, its presence was dismissed as an isolated event. (Pl.'s Ex. 268 at 4-16.) In the April RAP, Sealy...