State of Nev. ex rel. Dept. Of Transp. v. US

• Decision Date: 13 May 1996
• Docket Number: No. CV-S-94-393-DWH (LRL).,CV-S-94-393-DWH (LRL).
• Citation: 925 F. Supp. 691
• Parties: STATE OF NEVADA ex rel. its DEPARTMENT OF TRANSPORTATION, Stauffer Management Company and Rhone-Poulenc, Inc., Plaintiffs, v. The UNITED STATES of America and Atlantic Richfield Company, Defendants.
• Court: U.S. District Court — District of Nevada

925 F. Supp. 691

STATE OF NEVADA ex rel. its DEPARTMENT OF TRANSPORTATION, Stauffer Management Company and Rhone-Poulenc, Inc., Plaintiffs, v. The UNITED STATES of America and Atlantic Richfield Company, Defendants.

No. CV-S-94-393-DWH (LRL).

United States District Court, D. Nevada.

May 13, 1996.

Brian Randall Hutchens, Chief Deputy Attorney General, Carson City, Nevada, for plaintiff State of Nev., Dept. of Transp.

Michael Gallagher, Davis, Graham & Stubbs, Denver, Colorado, for defendant Atlantic Richfield Co.

MEMORANDUM DECISION AND ORDER

HAGEN, District Judge.

This is an action by plaintiffs under section 107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. 9607, to recover costs incurred by plaintiffs in removing hazardous waste from property acquired by NDOT in 1987. ARCO was a prior owner of the property, and plaintiffs allege that ARCO's predecessors in interest were responsible for the dumping of hazardous materials many years before CERCLA's 1980 effective date.

Before the court are defendant's objections (# 82) to the magistrate judge's Report and Recommendation (# 81) on defendant's motion for summary judgment (# 39).

Any party may object to a magistrate judge's case-dispositive proposed order, findings, or recommendations. 28 U.S.C. 636(b)(1)(B); F.R.C.P. 72(b); L.R. 510-2. The district court must make a de novo determination of those portions of the magistrate judge's report to which objection is made and may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge. 28 U.S.C. 636(b)(1).

Summary judgment is appropriate where there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. F.R.C.P. 56. In this case, the parties agree for the purposes of this summary judgment motion that no material factual issues exist. Thus, the issue before the magistrate judge on the motion for summary judgment, and the issue which is now before this court, is purely one of law; to wit, whether CERCLA may be retroactively applied to impose liability on ARCO for acts or omissions occurring before the effective date of the statute. The thrust of ARCO's summary judgment motion is that after the Supreme Court's decision in Landgraf v. USI Film Products, 511 U.S. 244, 114 S.Ct. 1483, 128 L.Ed.2d 229 (1994), a retroactive reading of CERCLA is no longer viable.

On March 7, 1996, after considering the parties' supporting and opposing memoranda as well as their oral arguments, Magistrate Judge Leavitt filed a Report and Recommendation ("R & R") on ARCO's motion for summary judgment (# 81). Judge Leavitt recommended that the motion be denied. Defendant ARCO subsequently filed specific objections (# 82) to portions of Judge Leavitt's R & R. The court will examine the basis for each of ARCO's objections in turn.

Negative Implication

First, ARCO contends that the R & R's use of "negative implication" analysis to ascertain "the required clear statement" of congressional intent is impermissible under Landgraf.

As an initial matter, the court notes that Landgraf did not set forth a new rule of law regarding retroactive application of legislation. Rather, it clarified that the Supreme Court's decisions in Bradley v. Richmond School Board, 416 U.S. 696, 94 S.Ct. 2006, 40 L.Ed.2d 476 (1969) (authorizing application of statutory attorney's fees provision to a prevailing party in litigation commenced before the provision's effective date), and Thorpe v. Housing Authority of Durham, 393 U.S. 268, 89 S.Ct. 518, 21 L.Ed.2d 474 (1969) (authorizing application of a regulation requiring local housing authority to give pre-eviction notice of reasons and opportunity to an eviction commenced before issuance of the regulation) did not erode the traditional presumption against retroactivity. See Landgraf, 511 U.S. at ___ - ___, 114 S.Ct. at 1502-03. The Court then held that the Civil Rights Act of 1991, providing for compensatory and punitive damages and a right to a jury trial in Title VII cases, did not apply to cases pending on appeal when the statute was enacted.

Secondly, the court disagrees with ARCO's statement of the Landgraf holding. Landgraf does not require a clear statement of congressional intent; rather, it requires clear evidence of congressional intent. See Landgraf, at ___, ___, ___, 114 S.Ct. at 1505, 1506, 1508.

It is true that the Landgraf decision rejected the negative implication argument put forth in that case; however, the Court did not preclude all future use of a negative inference analysis in support of retroactive intent.

In Shell Oil, the court reasoned that "Congress implicitly authorized retroactive application of sections 107(a)(4)(A) and (B) by affirmatively limiting retroactive application of the third category of liability, damages to natural resources, section 107(a)(4)(C)¹." 605 F.Supp. at 1076. In addition, the limitations on expenditures from the Superfund for pre-enactment damages and releases imposed by section 111(d) specifically applied to purposes listed in § 111(b) and § 111(c)(1) and (2) only. The court reasoned

if the presumption against retroactivity were sufficient to preclude recovery for pre-enactment response costs, it would also be sufficient to preclude recovery for pre-enactment damages to natural resources. Obviously that was not intended. If it were, the limiting provisions of sections 107(f) and 111(d) would be mere surplusage. In order to give meaning to these provisions, one must assume that liability for other damages — costs of removal or remedial action incurred by any other person (§ 107(a)(4)(B)) — is not so limited. Id.

Here, the magistrate judge found, and for the reasons set forth in the R & R the court agrees, the negative implication analysis set forth in United States v. Shell Oil, 605 F.Supp. 1064 (D.Colo.1985) and articulated by the plaintiffs in this case is far more persuasive in the CERCLA context than it was in the Landgraf case.

Deletion of Express Retroactivity Provision

ARCO alleges that "a prior version of CERCLA contained an express retroactivity provision applicable to the entire bill which was deleted by Congress" and cites U.S. v. $814,254.76 for the proposition that "explicit deletion of a provision the only purpose of which was to provide for retroactive enforcement is strong evidence that Congress intended only prospective application." 51 F.3d 207, 212 (9th Cir.1995). Although the court cannot disagree with this statement, canons of statutory construction counsel that specific provisions should not be viewed in isolation.² Context is of crucial importance whether statutory analysis is limited to the text of the statute itself, or where, as here, it extends into the area of legislative history.

Although ARCO neglects to cite to any such express retroactivity provision in the legislative history, the court assumes ARCO refers to § 3072 of the original version of H.R. 7020, which provided as follows:

The provisions of this subpart and subpart C shall apply to releases of hazardous waste without regard to whether or not such releases occurred before, or occurred on or after, date of enactment.

This provision was ultimately deleted from H.R. 7020. Shell Oil, 605 F.Supp. at 1077. However, as discussed below, that altered version of H.R. 7020 never became law. Therefore, any inferences to be drawn from this particular change must be considered, if at all, in the context of the entire legislative process.

The legislative history is quite a bit more involved than ARCO suggests. As explained in the Shell Oil opinion, the version of CERCLA finally enacted was the Senate version of the bill³. Many of the original provisions were redrafted. 605 F.Supp. at 1077. Significantly, however, a proposed amendment to the Senate bill limiting liability for damages occurring wholly before enactment sharply distinguished between damages and response costs. See 605 F.Supp. at 1077-78. Although that amendment was eventually deleted, the distinction between retroactive damages liability and retroactive response cost liability was maintained in the final version of CERCLA as the §§ 107(f) and 111(d) limitations on recovery of natural resource damages⁴. Id. at 1079. Therefore, it is clear that the entire scheme of the statute contemplates retroactive liability for response costs, but not for natural resource damages.

Reliance on U.S. v. Shell Oil

ARCO argues that the R & R's reliance on U.S. v. Shell Oil, 605 F.Supp. 1064 (D.Colo. 1985) is misplaced because Shell Oil reverses the traditional presumption against retroactivity, clearly an impermissible approach after Landgraf. The court finds this objection to be without merit.

Nowhere in the Shell Oil opinion is the traditional presumption against retroactivity reversed. In fact, the Shell Oil court clearly applied the presumption⁵ and found it outweighed by overwhelming evidence of congressional intent on retroactivity. See United States v. Shell Oil, 605 F.Supp. 1064, 1069, 1076-77 (D.Colo.1985).

Effective Date Clause

ARCO argues that the magistrate judge's R & R erroneously fails to consider the prospective language of § 302(a), CERCLA's effective date clause. This argument is without merit.

The prospective language of § 302(a) referred to by ARCO is nothing more than the word "shall". The section reads: "Unless otherwise provided, all provisions of this Act shall be effective on Dec. 11, 1980."

An effective date provision, without more, does not speak to the issue of retroactivity for each section of a statute. See Landgraf, ___ U.S. at ___, 114 S.Ct. at 1505. While it is true that a standard effective date provision "indicating the date when an action can first be brought and when the time begins to run for issuing regulations and doing other future acts mandated by the statute" cannot be said to demonstrate that CERCLA was intended to apply...