U.S. v. Metropolitan St. Louis Sewer Dist.

• Decision Date: 06 March 2006
• Docket Number: No. 05-1598.,05-1598.
• Citation: 440 F.3d 930
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. METROPOLITAN ST. LOUIS SEWER DISTRICT, Defendant-Appellee, v. Mallinckrodt, Inc., Intervenor-Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 930

440 F.3d 930

UNITED STATES of America, Plaintiff-Appellee, v. METROPOLITAN ST. LOUIS SEWER DISTRICT, Defendant-Appellee, v. Mallinckrodt, Inc., Intervenor-Appellant.

No. 05-1598.

United States Court of Appeals, Eighth Circuit.

Submitted: November 16, 2005.

Filed: March 6, 2006.

Mark A. Arnold, argued, St. Louis, MO, for appellant.

Robert H. Oakley, argued, U.S. Dept. of Justice, Washington, DC, for appellee.

Before SMITH, HEANEY, and BENTON, Circuit Judges.

SMITH, Circuit Judge.

Mallinckrodt, Inc. intervened in a Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") contribution action between the Metropolitan St. Louis Sewer District ("MSD") and the Environmental Protection Agency ("EPA"). Mallinckrodt opposed the entry of a Consent Decree between the parties. Over Mallinckrodt's objections, the district court¹ entered the Consent Decree. Thereafter, Mallinckrodt filed motions for reconsideration based on newly discovered evidence pursuant to Federal Rules of Civil Procedure 59(e) and 60(b)(3). The district court denied these motions. For the reasons stated below, we affirm.

I. Background

CERCLA grants the Executive Branch substantial authority and broad discretion to provide for the cleanup of hazardous-substance sites. The government, however, does not bear the complete cost of site cleanup. CERCLA provides that monies spent by federal and state governments to clean up hazardous substances will, whenever possible, be recovered from responsible parties, including owners and operators of facilities where hazardous substances are disposed.

The United States spent $9,237,244.30 cleaning up the contamination of hazardous substances at the Great Lakes Container Corporation Superfund Site ("the Site") in St. Louis, Missouri. From 1952 to 1986, a facility that reconditioned used steel drums operated on the Site. During this period, the Site became contaminated with various hazardous substances. The larger portion of this Site consists of a 10-acre, roughly rectangular, parcel on which the drum reclamation facility was located. Mallinckrodt operated a drum recycling plant there between 1970 and 1976. Prior to that time, Mallinckrodt's corporate predecessor ran the plant. The remainder of the Site, just west of the former facility, is a one-acre parcel that was owned by the St. Louis Metropolitan Bridge Terminal Railway Company until MSD bought the property for expansion of its secondary treatment facilities. However, MSD never built additional facilities, and its property remained vacant.

In early 2001, the EPA invited MSD and Mallinckrodt to negotiate a settlement on the clean up costs. The EPA initially assigned a share of approximately 4% of the total cost to MSD for clean up of the Site. The EPA concluded that MSD was most likely a "passive landowner" that neither participated in nor profited from the contamination of its property by hazardous substances, even though approximately 26% of the contaminated soil that was removed from the Site, by volume, came from the one-acre tract owned by MSD. After extensive negotiations, MSD and the EPA negotiated a Consent Decree, which required MSD to reimburse the United States $230,000 in response costs. This reduced MSD's share of the clean up costs to about 2.52% of the total.

EPA and MSD filed this Consent Decree with the district court, and a thirty-day public comment period ensued. During this period, the United States received comments from Mallinckrodt, a defendant in a companion CERCLA case involving the same Site, arguing that the amount to be paid by MSD was too small and that Mallinckrodt and other potentially responsible parties ("PRPs") would be unfairly saddled with the remainder of the costs. Since CERCLA provides for joint and several liability for all PRPs, any reduction in MSD's liability could increase Mallinckrodt's. Mallinckrodt formally intervened in the district court case between MSD and the EPA and filed its opposition to the United States' motion to enter the Consent Decree. After considering the parties' briefing and argument, the district court entered the Consent Decree.

After entry of the Consent Decree, Mallinckrodt timely filed a Fed.R.Civ.P. 59(e) motion to alter or amend the judgment, alleging the discovery of new evidence. Mallinckrodt claimed that an expert report prepared in its companion CERCLA case, which interpreted aerial photographs of the Site, established that MSD actively participated in the transportation and disposal of wastes on its part of the Site.² Mallinckrodt also submitted three documents it obtained from the EPA in support of this claim. The district court denied Mallinckrodt's motion, stating that the evidence was not "new."

After the district court denied its Rule 59(e) motion, Mallinckrodt filed a motion pursuant to Rule 60(b)(3), asking the district court to reconsider. Mallinckrodt claimed that counsel for MSD and the EPA made fraudulent statements at the hearing on the Consent Decree. The district court denied Mallinckrodt's Rule 60(b)(3) motion. Mallinckrodt filed a timely notice of appeal of the district court's entry of the Consent Decree and its rulings on the post-judgment motions.

II. Discussion

On appeal, Mallinckrodt contends that the district court granted the Consent Decree settlement because MSD falsely represented itself as a passive owner, and this misrepresentation prevented Mallinckrodt from fairly presenting its objections. In addition, Mallinckrodt suggests that newly discovered evidence establishes that MSD actually materially contributed to the contamination, and this new evidence is both material and outcome determinative. Specifically, Mallinckrodt argues that the expert report submitted after the Consent Decree was entered, prepared by Wayne Grip, an expert in interpreting aerial photographs, established that MSD was a substantial contributor to the contamination of the Site. Therefore, Mallinckrodt contends that the district court abused its discretion in denying its post-judgment motions for relief. We disagree and affirm.

A. Rule 59(e) Motion³

A district court has broad discretion in determining whether to grant or deny a motion to alter or amend judgment pursuant to Rule 59(e), and this court will not reverse absent a clear abuse of discretion. Innovative Home Health Care v. P.T.-O. T. Assoc. of the Black Hills, 141 F.3d 1284, 1286 (8th Cir.1998). It should be noted that Rule 59(e) motions serve the limited function of correcting "'manifest errors of law or fact or to present newly discovered evidence.'" Id. (quoting Hagerman v. Yukon Energy Corp., 839 F.2d 407, 414 (8th Cir.1988)). "Such motions cannot be used to introduce new evidence, tender new legal theories, or raise arguments which could have been offered or raised prior to entry of judgment." Id. To prevail on a Rule 59(e) motion, the movant must show that (1) the evidence was discovered after trial; (2) the movant exercised due diligence to discover the evidence before the end of trial; (3) the evidence is material and not merely cumulative or impeaching; and (4) a new trial considering the evidence would probably produce a different result. See U.S. Xpress Enter. Inc. v. J.B. Hunt Transp., Inc., 320 F.3d 809, 815 (8th Cir.2003) (discussing factors one must show to prevail under Rule 60(b)(2), which are the same under Rule 59(e)).

Mallinckrodt argues that the district court should have granted its motion for a new trial pursuant to Rule 59(e) based on newly discovered evidence, namely, the newly acquired Grip analysis of MSD's activities on the Site. First, Mallinckrodt states that it did not discover the evidence that MSD materially contributed to the contamination of the Site until 11 days after the judgment, when Grip completed his expert report. Second, Mallinckrodt avers that it exercised due diligence to discover the evidence. Mallinckrodt asserts that the focus of the hearing on the Consent Decree was whether MSD knowingly allowed others to contaminate its property—not whether MSD itself had materially contributed to the contamination. The district court found that the documents and photographs underlying the Grip report were in Mallinckrodt's possession or readily available prior to the Consent Decree. Mallinckrodt responds by stating that this finding ignores the context in which Mallinckrodt acted. Mallinckrodt argues that it had no reason to doubt the EPA and MSD's representations that MSD had not contributed to the contamination. Consequently, Mallinckrodt claims that it had no reason to look for this evidence.

Third, Mallinckrodt suggests that this evidence is material, not cumulative, because it is the only evidence on the topic of MSD's contribution to the Site contamination. For that same reason, Mallinckrodt states that a new trial considering this new evidence would produce a different result. Under CERCLA, the settlement is to reflect the relationship of the settlement figure to the proportion of the settling party's waste. Based on its purported new evidence, Mallinckrodt claims MSD's 2.5% settlement is unfair and contrary to the aims of CERCLA. It further avers that it has offered far more than speculation, and for that reason, the district court abused its discretion in denying its Rule 59(e) motion.

The appellees respond by stating that Mallinckrodt has failed to show any of the four elements necessary to prevail under Rule 59(e). First, the Grip report was created, not discovered, after the district court entered judgment. Second, Mallinckrodt failed to complete the Grip report in time to present it during the Consent Decree hearing and thus did not exercise due diligence. Third, the Grip report is highly conclusory, and at best, cumulative. Lastly, the district court's consideration and rejection of the Grip report shows that even if the report had been timely presented, it would not have prevented approval of the Consent Decree.

We agree with ...