State of Minn. v. Kalman W. Abrams Metals, Inc., No. 97-3545

CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)
Writing for the CourtBefore BOWMAN, Chief Judge, HEANEY and LOKEN; LOKEN
Parties29 Envtl. L. Rep. 20,088 STATE OF MINNESOTA, Plaintiff-Appellant, v. KALMAN W. ABRAMS METALS, INC.; Blum Holdings, Inc.; A & D Recycling, Inc.; Martin Bush Iron & Metal Company; Metalsmith Recycling Co., Defendants-Appellees, Kirschbaum-Krupp Metal Co.; Leder Brothers Company, Defendants.
Decision Date17 September 1998
Docket NumberNo. 97-3545

Page 1019

155 F.3d 1019
29 Envtl. L. Rep. 20,088
STATE OF MINNESOTA, Plaintiff-Appellant,
v.
KALMAN W. ABRAMS METALS, INC.; Blum Holdings, Inc.; A & D
Recycling, Inc.; Martin Bush Iron & Metal
Company; Metalsmith Recycling Co.,
Defendants-Appellees,
Kirschbaum-Krupp Metal Co.; Leder Brothers Company, Defendants.
No. 97-3545.
United States Court of Appeals,
Eighth Circuit.
Submitted June 11, 1998.
Decided Sept. 17, 1998.

Page 1021

Alan Richard Mitchell, Asst. Atty. Gen., St. Paul, MN., argued (Janette Kay Brimmer, on the brief), for appellant.

Rick E. Kubler, Gray, Plant, Mooty, Mooty & Bennett, P.A., Minneapolis, MN, argued (Tami L. Norgard, on the brief), for Blum Holdings, Inc. and A & D Recycling, Inc.

Timothy Robert Thornton, Minneapolis, MN, argued (Scott G. Bowman, on the brief), for Kalman W. Abrams and Martin Bush Iron & Metal Company.

Before BOWMAN, Chief Judge, HEANEY and LOKEN, Circuit Judges.

LOKEN, Circuit Judge.

The State of Minnesota has sued to recover costs incurred by the Minnesota Pollution Control Agency (MPCA) in cleaning up lead-contaminated soils. The defendants are present and former owners of companies that furnished scrap wire to the site's proprietor for an environmentally unsound recycling process. The State asserts claims under the federal "superfund" law, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. §§ 9601-75, and its state law counterpart, the Minnesota Environmental Response and Liability Act (MERLA), Minn.Stat. §§ 115B.01-.24. The State appeals the grant of summary judgment in favor of non-settling defendants. We agree that the State's claims must in large part be rejected because MPCA conducted the cleanup in an arbitrary and capricious manner. But we conclude the State may recover from responsible private parties for the non-arbitrary portion of response costs that ultimately produced a successful environmental remedy. Accordingly, we reverse in part and remand.

I. Background.

For over ten years, Gerald McGuire obtained used insulated wire from Twin Cities scrap dealers, burned insulation off the wire on his residential property in Mora, Minnesota, and returned or resold clean wire to the scrap dealers. McGuire was paid based on the weight of insulation burned off. The burning process generated ash, which McGuire spread over portions of his property. He also may have conducted smelting activities generating slag that he deposited on the premises. In April 1985, MPCA obtained a search warrant and inspected the McGuire property. When a preliminary soil analysis revealed hazardous lead concentrations, McGuire ceased his burning operations but advised MPCA that he could not afford to clean up the site. The agency placed the site on its Permanent List of Priorities under MERLA. See Minn.Stat. § 115B.17, subd. 13.

In June, 1986, the United States Environmental Protection Agency (EPA) conducted a Site Assessment at MPCA's request. Soil analyses revealed hazardous concentrations of lead and elevated concentrations of other metals that posed "an imminent and substantial

Page 1022

threat to human health and the environment," particularly to McGuire's young children and grandchildren who often played on the site. MPCA designated the site as a "Class C" priority but took no action until March 1989, when it sent McGuire a formal Request for Information (RFI) asking him to identify suppliers of the insulated wire he had burned. 1 The agency then sent RFIs to the scrap dealers who eventually became defendants. Sam Blum denied knowledge of dealing with McGuire. The others admitted having McGuire burn insulation off used wire for them, and one admitted furnishing lead cable for burning. One denied responsibility for any release or threatened release of hazardous substances, while the others simply answered the RFI questions and denied knowledge of any such releases.

On August 28, 1990, MPCA issued a Request for Response Action (RFRA) formally asking McGuire to remedy the releases and threatened releases of hazardous substances at his property, and notifying him that, if he failed to do so, the agency could commence an action to compel performance or complete the requested actions and seek reimbursement from him. 2 At the same time, the agency determined that he would not comply based upon his prior representations of poverty and authorized the expenditure of $350,000 from the superfund to clean up the site. At the agency Board meeting approving these actions, MPCA staff advised its Commissioners that no RFRAs should be issued to the scrap dealers because their liability was not entirely clear.

In January 1991, MPCA selected Delta Environmental Consultants to investigate the site and supervise the contractor hired to complete the selected remedy. MPCA later contracted with Microbial Biotechnology, Inc. (MBI), to perform on-site lead extraction using a treatment method known as soil washing. The agency announced to the public that the "whole cleanup process ... will cost approximately $200,000" and distributed news releases advising this would be its first on-site attempt to extract lead from contaminated soil. It held a public meeting on June 27, 1991, at a local sportsmen's club to apprise the community of its decision.

After the cleanup began, MBI discovered that 1500 cubic yards of soil were contaminated, rather than 500 cubic yards, prompting MPCA to authorize spending an additional $350,000. Despite this additional funding, the MBI cleanup was a failure. Mechanical problems plagued MBI's equipment, and actual soil conditions were not conducive to soil washing. MBI failed to respond to MPCA complaints and finally quit the job in November 1991. MPCA terminated MBI's contract after spending $195,301.57 on this phase of the cleanup effort. MPCA next paid $25,000 to Cognis, Inc., a California firm, to test a different on-site soil treatment process. Cognis reported that it could not meet MPCA's rigorous lead treatment goal. MPCA then abandoned on-site remediation and, after a final bid process, hired Remediation Services, Inc. (RSI), to perform on-site stabilization of the soil followed by off-site disposal. RSI successfully completed the task in one month at a cost of $293,621.79. No further cleanup work is anticipated, and the site has been removed from the State's Permanent List of Priorities.

MPCA incurred a total of $660,384.82 in response costs to clean up the McGuire site. In January 1996, the State commenced this action to recover all response costs from the scrap dealers. Defendants are Kalman W. Abrams Metals, Inc. (KWA); two companies allegedly responsible for the actions of Martin Bush Iron & Metal Company (Martin Bush); Blum Holdings, the former owner of Sam Blum Iron & Metal Company (Blum Holdings); A & D Recycling, Inc., the present owner of Sam Blum Iron & Metal (A & D Recycling); and two companies allegedly responsible

Page 1023

for the actions of Leder Brothers Scrap Iron & Metal Company (Leder Brothers).

The district court issued four orders disposing of the State's claims. First, it granted summary judgment in favor of Blum Holdings on the ground that the State did not initiate legal or administrative proceedings before that corporation dissolved. The State appeals that ruling, which will be the last issue addressed in this opinion. Second, the court issued two orders granting summary judgment on the merits in favor of KWA, Martin Bush, and A & D Recycling. The court dismissed the State's CERCLA claims on the ground that MPCA is not entitled to reimbursement because it acted arbitrarily and capriciously in selecting a soil treatment plan and in failing to properly notify defendants of its proposed response action. The court dismissed the State's MERLA claims as time-barred by the six-year statute of limitations in Minn.Stat. § 115B.11. The State appeals these rulings, which are the principal focus of this opinion. Finally, after the State filed its notice of appeal, the district court entered a consent decree as to Leder Brothers reflecting a prior settlement. Appellees rely on the timing of this decree as one basis for their motion to dismiss the State's appeal for lack of jurisdiction, the issue we will next address.

II. Appellate Jurisdiction.

Appellees move to dismiss the appeal, arguing we lack jurisdiction because the district court orders being appealed did not resolve claims against Leder Brothers and did not resolve pending claims among the defendants. The motion is denied.

In the district court, all the defendants initially moved for summary judgment. The State notified the district court in July 1997 that it had settled with Leder Brothers. The three orders being appealed resolved all the State's claims against the four non-settling defendants--Blum Holdings in August 1996, KWA and Martin Bush in August 1997, and A & D Recycling on September 15, 1997. The court's August 1997 summary judgment order noted that Leder Brothers "originally joined in this motion, but have since settled with the plaintiffs." The settlement was not final in August 1997 because MPCA was awaiting public comments on the proposed consent decree. The State filed its notice of appeal on September 19, four days after the order entering summary judgment in favor of A & D Recycling.

"No statute or rule specifies the essential elements of a final judgment"; what is required is "some clear and unequivocal manifestation by the trial court of its belief that the decision made, so far as the court is concerned, is the end of the case." Goodwin v. United States, 67 F.3d 149, 151 (8th Cir.1995). When it dismissed all claims against the last three non-settling defendants, the district court understood that Leder Brothers had settled and therefore its last two summary judgment rulings need...

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38 practice notes
  • Bernstein v. Bankert, No. 11-1501
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • July 31, 2013
    ...responses.'" Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594, 608 (8th Cir. 2011) (quoting Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir. 1998)). 6. "The national contingency plan specifies procedures for preparing and responding to contaminations and was promu......
  • U.S. v. W.R. Grace & Co., No. 03-35924.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • December 1, 2005
    ...for which the EPA is granted considerable leeway in structuring the cleanup. See, e.g., Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998) (describing "removal actions" as "those taken to counter imminent and substantial threats to public health and welfare"). Su......
  • Bernstein v. Bankert, Nos. 11–1501
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • July 31, 2013
    ...responses.’ ” Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594, 608 (8th Cir.2011) (quoting Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998)). 6. “The national contingency plan specifies procedures for preparing and responding to contaminations and was promul......
  • U.S. v. E.I. Dupont De Nemours and Co. Inc., No. 04-4546.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • December 22, 2005
    ...for the EPA's actions in incurring response costs, including oversight costs. Id.; see also Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998). Other courts of appeals have adopted this burden of proof and standard of review. See Wash. State Dep't of Transp. v. W......
  • Request a trial to view additional results
37 cases
  • Bernstein v. Bankert, No. 11-1501
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • July 31, 2013
    ...Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594, 608 (8th Cir. 2011) (quoting Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir. 1998)). 6. "The national contingency plan specifies procedures for preparing and responding to contaminations and was promulgated b......
  • U.S. v. W.R. Grace & Co., No. 03-35924.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • December 1, 2005
    ...for which the EPA is granted considerable leeway in structuring the cleanup. See, e.g., Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998) (describing "removal actions" as "those taken to counter imminent and substantial threats to public health an......
  • Bernstein v. Bankert, Nos. 11–1501
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • July 31, 2013
    ...responses.’ ” Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594, 608 (8th Cir.2011) (quoting Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998)). 6. “The national contingency plan specifies procedures for preparing and responding to contaminations and was promul......
  • U.S. v. E.I. Dupont De Nemours and Co. Inc., No. 04-4546.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • December 22, 2005
    ...for the EPA's actions in incurring response costs, including oversight costs. Id.; see also Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir.1998). Other courts of appeals have adopted this burden of proof and standard of review. See Wash. State Dep't of Transp. v. W......
  • Request a trial to view additional results
1 books & journal articles
  • The Site Cleanup Processes
    • United States
    • Superfund Deskbook -
    • August 11, 2014
    ...may otherwise result from a release or threat of release.” 42 U.S.C. §9601(23). See, e.g. , Minnesota v. Kalman W. Abrams Metals, Inc., 155 F.3d 1019, 1024 (8th Cir. 1998) (describing “removal actions” as “those taken to counter imminent and substantial threats to public health and welfare”......

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