United States v. Puerto Rico Indus. Dev. Co.

• Decision Date: 25 March 2019
• Docket Number: Civil No. 15-2328 (FAB)
• Citation: 368 F.Supp.3d 326
• Parties: UNITED STATES of America, Plaintiff, v. PUERTO RICO INDUSTRIAL DEVELOPMENT COMPANY, Defendant.
• Court: U.S. District Court — District of Puerto Rico

368 F.Supp.3d 326

UNITED STATES of America, Plaintiff,

v.PUERTO RICO INDUSTRIAL DEVELOPMENT COMPANY, Defendant.

Civil No. 15-2328 (FAB)

United States District Court, D. Puerto Rico.

Signed March 25, 2019

Catherine Adams Fiske, United States Department of Justice, Boston, MA, Richard Samuel Greene, IV, Patrick B. Bryan, United States Department of Justice Environmental Enforcement Section, Washington, DC, for Plaintiff.

Juan J. Casillas-Ayala, Diana M. Batlle-Barasorda, Casillas, Santiago & Torres, LLC, Victor D. Candelario-Vega, Quinones & Arbona, PSC, Ana Maria Palou-Balsa, Puerto Rico Industrial Company, Giselle M. Martinez-Velazquez, Cancio, Nadal, Rivera & Diaz, PSC, San Juan, PR, for Defendant.

OPINION AND ORDER

BESOSA, District Judge.

Before the Court are plaintiff United States' and defendant Puerto Rico Industrial Development Company ("PRIDCO")'s cross-motions for summary judgment pursuant to Federal Rule of Civil Procedure 56 (" Rule 56"). (Docket Nos. 142 and 143.) The United States also moves to limit the scope of judicial review. (Docket No. 138.) For the reasons set forth below, the United States' motion for summary judgment is GRANTED IN PART and DENIED IN PART , PRIDCO's motion for summary judgment is DENIED , and the United States' motion to limit the scope of judicial review is DENIED WITHOUT PREJUDICE . (Docket Nos. 138, 142 and 143.)

I. Background

This matter concerns contaminated groundwater located on property belonging to PRIDCO in Maunabo, Puerto Rico (hereinafter, the "property").¹ The United States asserts that PRIDCO is liable for "all response costs, including enforcement costs, incurred by the [Environmental Protection Agency, ("EPA") ] in connection with the [Maunabo Area Groundwater Contamination Superfund Site]" pursuant to the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9607 et seq . (Docket No. 8 at p. 7.)

Congress drafted CERCLA in 1980 to address the release or threatened release of hazardous substances into the environment.² 42 U.S.C. § 9601 et seq . CERCLA permits the United States to allocate funds from a "Hazardous Substance Superfund" to finance cleanup efforts. 26 U.S.C. § 9507. The United States may replenish the Hazardous Substance Superfund pursuant to section 9607 of CERCLA by bringing suit against, among others, "any person who at the time of disposal of any hazardous substances owned or operated any facility at which hazardous substances were disposed of." 42 U.S.C. § 9607(a) ; United States v. Bestfoods, 524 U.S. 51, 55, 118 S.Ct. 1876, 141 L.Ed.2d 43 (1998) ("CERCLA is a comprehensive statute that grants the President broad power to command government agencies and private parties to clean up hazardous waste sites.") (citation omitted).³

A. Hazardous Substances Are Located on PRIDCO's Property

PRIDCO is a government instrumentality of the Commonwealth of Puerto Rico, incorporated in 1942 to stimulate the formation of local firms and to attract foreign investment. (Docket No. 11 at p. 2; Docket No. 117, Ex. 3 at p. 2.) To accomplish these ends, PRIDCO maintains an infrastructure development program, and facilities for lease or sale to qualified investors. (Docket No. 117, Ex. 3 at p. 2.) The property, which PRIDCO acquired in 1964, is among these facilities. (Docket No. 117, Ex. 4 at p. 2.)⁴

The Puerto Rico Aqueduct and Sewer Authority ("PRASA") operates four groundwater supply wells in Maunabo, providing water to 14,000 people. (Docket No. 101, Ex. 6 at p. 12.) One of the four PRASA wells is located adjacent to the southern edge of the property (hereinafter, "Maunabo well"). (Docket No. 101, Ex. 14 at p. 17.) Between 2001 and 2004, PRASA detected volatile organic compounds ("VOC"), including trichloroethylene ("TCE") and cis-1, 2-dichloroethene ("cis-1, 2-DCE"), in the public water supply.⁵ (Docket No. 101, Ex. 3 at p. 23.) TCE and cis-1, 2-DCE are hazardous substances. Id. In 2002, PRASA discovered that groundwater from the Maunabo well contained TCE and cis-1, 2-DCE. (Docket No. 101, Ex. 6 at p. 12.) PRASA installed a carbon filtration system to treat the contaminated groundwater. (Docket No. 101, Ex. 2 at p. 3.)⁶

The EPA and the Puerto Rico Environmental Quality Board ("EQB") are responsible for the decontamination of the groundwater. (Docket No. 101, Ex. 6 at pp. 12—13.) The EPA confirmed that the groundwater from the Maunabo well is contaminated primarily with cis-1, 2-DCE. Id. at p. 26. After further investigation, the EPA discovered three plumes of contaminated groundwater throughout the Municipality of Maunabo. (Docket No. 101, Ex. 5 at p. 171.) The three plumes are referred to as: (1) cis-1, 2-DCE, (2) PCE, and (3) 1, 1-DCE. (Docket No. 101, Ex. 5 at p. 171.) The cis-1, 2-DCE plume is located below the property, "flow[ing] southwest toward [a] river, but is intercepted by [the Maunabo well]." (Docket No. 101, Ex. 6 at p. 26; Docket No. 101, Ex. 3 at p. 14.) The PCE plume is located south of the PRIDCO property near a former sugar mill. (Docket No. 101, Ex. 4 at p. 18.) The 1, 1-DCE plume is located northwest of the property. (Docket No. 101, Ex. 6 at p. 12.) Together, the three plumes comprise the Maunabo Area Groundwater Contamination Superfund Site (hereinafter, "the site"). (Docket No. 101, Ex. 6 at p. 12.).⁷ The EPA placed the site on the National Priorities List, a compilation of the most contaminated sites in the United States. Id. at p. 15.⁸

The EPA issued the Record of Decision ("ROD") in 2012, setting forth the "factual and legal basis for selecting the [applicable] remedy." (Docket No. 139, Ex. 2 at p. 7.)⁹ The remedy selected by the EPA incorporates air sparging for the cis-1, 2-DCE plume and monitored natural attenuation for the PCE and 1, 1-DCE plumes. (Docket No. 101, Ex. 6 at p. 75.)¹⁰

The United States commenced this action on September 23, 2015. (Docket No. 21.) The Court granted the United States' motion to trifurcate this litigation into a Liability Phase ("Phase I"), a Cost Phase ("Phase II"), and a Contribution Phase ("Phase III"). (Docket No. 85.)

B. Phase I: PRIDCO is Prima Facie Liable for the Release of Hazardous Substances

The United States moved for summary judgment as to liability in Phase I. (Docket No. 101.) PRIDCO opposed summary judgment, emphasizing that "the technical data available to date does not support the proposition [that the property] is the source of contamination." (Docket No. 116 at p. 5.)¹¹ The source of contamination, however, is immaterial to the prima facie liability analysis. See Robertshaw Controls Co. v. Watts Regulator Co., 807 F.Supp. 144, 153 (D. Me. 1992) ("Congress specifically rejected including a causation requirement in Section 9607."). CERCLA "sketches the contours of a strict liability regime." Acushnet Co. v. Mohasco, 191 F.3d 69, 74 (1st Cir. 1999) ; see United States v. Monsanto, 858 F.2d 160, 161 (4th Cir. 1988) ("We agree with the overwhelming body of precedent that has interpreted [CERCLA] as establishing a strict liability scheme."). CERCLA contains no causation element. Prisco v. A & D Carting Corp., 168 F.3d 593, 606 (2d Cir. 1999) ("No causation is needed, however, to establish liability under CERCLA.") (internal citation omitted). Accordingly, the Court held that PRIDCO is prima facie liable for the release of hazardous substances on its property. United States v. P.R. Indus. Dev. Co., 287 F.Supp.3d 133 (D.P.R. 2017) (Besosa, J.).¹² The Court permitted PRIDCO, however, to assert certain affirmative defenses in Phase II. Id. at 153. The parties later filed cross-motions for summary judgment as to the availability of the third-party defense. (Docket Nos. 142 and 143.) The United States also moves for summary judgment regarding costs, seeking to recover $ 5,398,161.04 from PRIDCO. (Docket No. 142 at p. 13.)

II. Standard of Review

A court will grant summary judgment if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "A dispute is genuine if the evidence about the fact is such that a reasonable jury could resolve the point in the favor of the non-moving party. A fact is material if it has the potential of determining the outcome of the litigation." Dunn v. Trs. of Bos. Univ., 761 F.3d 63, 68 (1st Cir. 2014) (internal citation omitted).

The role of summary judgment is to "pierce the boilerplate of the pleadings and assay the parties' proof in order to determine whether trial is actually required." Tobin v. Fed. Exp. Corp., 775 F.3d 448, 450 (1st Cir. 2014) (internal citation omitted). The party moving for summary judgment has the initial burden of "demonstrat[ing] the absence of a genuine issue of material fact" with definite and competent evidence. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; Maldonado-Denis v. Castillo-Rodríguez, 23 F.3d 576, 581 (1st Cir. 1994). The movant must identify "portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any’ " which support its motion. Celotex, 477 U.S. at 323, 106 S.Ct. 2548 (citing Fed. R. Civ. P. 56(c) ).

Once a properly supported motion has been presented, the burden shifts to the nonmovant "to demonstrate that a trier of fact reasonably could find in [its] favor." Santiago-Ramos v. Centennial P.R. Wireless Corp., 217 F.3d 46, 52 (1st Cir. 2000) (internal citation omitted). "When the nonmovant bears the burden of proof on a particular issue, [he or] she [or it] can thwart summary judgment only by identifying competent evidence in the record sufficient to create a jury question." Tobin, 775 F.3d at 450-51. A court draws all reasonable inferences from the record in the light most favorable to the nonmovant, but it disregards unsupported and conclusory allegations. McGrath v. Tavares, 757 F.3d 20, 25 (1st Cir. 2014).

When parties file cross-motions for summary judgment, a court must "consider each motion...