US v. Serafini, 3:CV-86-1591.

• Decision Date: 07 December 1994
• Docket Number: No. 3:CV-86-1591.,3:CV-86-1591.
• Citation: 898 F. Supp. 287
• Parties: UNITED STATES of America, Plaintiff, v. Louis SERAFINI, et al., Defendants, and CITY of SCRANTON, PENNSYLVANIA, Defendant and Third Party Plaintiff, v. LACKAWANNA REFUSE REMOVAL, INC., et al., Third Party Defendants.
• Court: U.S. District Court — Middle District of Pennsylvania

898 F. Supp. 287

UNITED STATES of America, Plaintiff, v. Louis SERAFINI, et al., Defendants, and CITY of SCRANTON, PENNSYLVANIA, Defendant and Third Party Plaintiff, v. LACKAWANNA REFUSE REMOVAL, INC., et al., Third Party Defendants.

No. 3:CV-86-1591.

United States District Court, M.D. Pennsylvania.

December 7, 1994.

W. Benjamin Fisherow, Steven R. Baer, Lands and Natural Resources Div., Environmental Enforcement Section, Dept. of Justice, Washington, DC, Bruce D. Brandler, Asst. U.S. Atty., Scranton, PA, Lydia Isales, Asst. Regional Counsel Region III, U.S. E.P.A., Philadelphia, PA, for plaintiff.

Brian J. Cali, Robert A. Cecchini, Dunmore, PA, for defendants Louis Serafini, Alfred Bernabei, Ernest Buttafoco, and Michael J. Naples, Jr., Individually and Training as Empire Contracting Co.

MEMORANDUM

McCLURE, District Judge.

BACKGROUND

This is an action for injunctive relief and recovery of response costs pursuant to Sections 106 and 107 of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. §§ 9606(a) and 9607(a), in connection with the Taylor Borough hazardous waste site located south of Scranton, Pennsylvania. The remedial action at the Taylor Borough site was completed pursuant to a consent decree negotiated by the United States and several defendants. The United States then sought reimbursement of costs it incurred in responding to the release of hazardous substances at the site from the remaining defendants, the City of Scranton (Scranton) and Louis Serafini, Alfred Bernabei, Ernest Buttafoco, and Michael J. Naples, Jr., individually and trading as Empire Contracting Company (hereafter, collectively the Empire defendants). On December 4, 1989, Scranton filed a third-party action against numerous defendants seeking contribution and indemnification under CERCLA and common law theories.

Currently before the court are:¹ 1) a motion² by defendant and third-party plaintiff Scranton for reconsideration of the court's orders dated June 5, 1992 and September 17, 1993 granting the United States' motion for response costs; and 2) a motion³ by the Empire defendants seeking the same relief.⁴

Defendants seek an order: 1) vacating the prior orders; 2) directing the United States to submit, within forty-five days from the date of the order "detailed documentation" in support of its previously submitted motion for summary judgment on response costs; and 3) granting Scranton and the other non-settling defendants the right to take a deposition pursuant to Fed.R.Civ.P. 30(b)(6) regarding the cost documentation submitted by the United States.

For the reasons which follow, both motions will be granted.

DISCUSSION

STANDARD OF REVIEW

Scranton moves for reconsideration under Fed.R.Civ.P. 59(e)⁵ and Local Rule 412,⁶ or in the alternative, Fed.R.Civ.P. 60(b). A rule 59(e) motion must rely on at least one of three grounds: 1) intervening change in controlling law, 2) availability of new evidence not previously available, or 3) need to correct a clear error of law or prevent manifest injustice. Atkins v. Marathon LeTourneau Co., 130 F.R.D. 625, 626 (S.D.Miss. 1990); Natural Resources Defense Council, Inc. v. U.S. E.P.A, 705 F.Supp. 698, 702 (D.D.C.1989), vacated on other grounds upon agreement of the parties, 707 F.Supp. 3 (D.D.C.1989).

Scranton relies on the first ground. Citing the decision by the United States Court of Appeals for the Third Circuit in United States v. Rohm and Haas Co., 2 F.3d 1265 (3d Cir.1993) (Rohm), it seeks reconsideration of this court's grant of summary judgment in favor of the United States on the issue of response costs. Scranton argues that Rohm, supra:

unequivocally holds that costs incurred by the United States in overseeing a hazardous waste cleanup performed by a private party pursuant to consent decree are not recoverable under ... CERCLA ... The orders entered by this Court on June 5, 1992 and September 17, 1993 granted relief for costs incurred by the United States in its oversight of the cleanup by private parties of the site at issue in this case, and because the recovery of such oversight costs is flatly prohibited under CERCLA by the Third Circuit's controlling precedent in Rohm and Haas.

(Record document no. 441, pp. 1-2)

In support of its motion, Scranton cites the following:

1. At issue in this lawsuit is the responsibility for response costs incurred in connection with the cleanup of the landfill located on Snake Road in Taylor Borough, Pennsylvania;

2. Certain defendants to this action (settling defendants) entered into a consent decree with the United States⁷—the consent decree was approved by the court on July 20, 1987;

3. Pursuant to the consent decree, the settling defendants performed the remedial actions selected by the EPA at the Taylor site;

4. The EPA supervised the remedial action performed by the settling defendants, and in so doing, incurred oversight costs;

5. Such costs were part of the total response costs sought by the United States pursuant to its motion for summary judgment against Scranton filed February 14, 1991; (See: record document no. 458, p. 1);

6. The United States' motion was granted by this court's order of June 5, 1992, which awarded the United States response costs totalling $2,333,761.12;

7. The June 5, 1992 order was not a final order due to the pendency of Scranton's claims for contribution against third party defendants, See: Fed.R.Civ.P. 54(b);

8. In an opinion entered August 12, 1993 in Rohm and Haas, supra, the Third Circuit ruled that costs incurred by the federal government in overseeing cleanup operations conducted by private parties are not recoverable as removal or remedial costs under section 107 of CERCLA, 42 U.S.C. § 9607;

9. On September 17, 1993, upon praecipe of the United States, this court entered an order directing that final judgment be entered pursuant to the June 5, 1992 order granting summary judgment in favor of the United States and against Scranton on its request for response costs incurred at the site, Fed.R.Civ.P. 54(b).

(Record document no. 441, pp. 2-5)

Scranton argues, based on the foregoing that:

1) This court's orders dated June 5, 1992 and September 17, 1993 granting response costs which include the cost of overseeing cleanup operations conducted by private parties are "squarely at odds with the Third Circuit's holding in Rohm and Haas;"

2) "The United States will not be unfairly prejudiced by the granting of the instant Motion;" and

3) Scranton "acted promptly and diligently in raising this issue before the Court."

(Record document no. 441, p. 5, ¶¶ 12-15)

The background facts, i.e. this court's entry of judgment in plaintiff's favor for cleanup costs which included costs incurred in overseeing cleanup activities undertaken by private parties are undisputed and undisputable. Scranton's recitation of the Third Circuit's holding in Rohm, supra, is correct. The court stated unequivocally that government oversight costs incurred in monitoring the cleanup of a hazardous site conducted by private parties are not recoverable as removal or remedial costs under CERCLA section 107, 42 U.S.C. § 9607.

Decisions from this circuit subsequent to Rohm, supra have universally found that to be its holding. See, e.g., FMC Corp. v. United States Department of Commerce, 29 F.3d 833, 850 (3d Cir.1994) (Rohm "held that the government could not recover from private parties the cost of government oversight of the removal and remedial activity performed and paid for by a private party.") and United States v. Witco Corporation, 853 F.Supp. 139, 142 (E.D.Pa.1994) "(After careful examination and consideration of the Third Circuit's holding in ... Rohm ... we are constrained to agree with the defendant that such oversight costs are not recoverable."). Cf. United States v. Lowe, 864 F.Supp. 628, 629 and 630 (S.D.Tex.1994) (District court for the Southern District of Texas rejected as "unpersuasive" the Third Circuit's reasoning supporting its holding in Rohm and Haas, supra, that the United States could not recover its costs for overseeing performance of remedial actions conducted by private parties.) and United States v. Atlas Minerals and Chemicals, Inc., 851 F.Supp. 639, 647-50 (E.D.Pa.1994) (Rohm and Haas holding precluding recovery of oversight costs as "costs of removal" under 42 U.S.C. § 9607(a)(4)(A) and § 9601(23) did not render invalid previously negotiated consent decree providing for recovery of such costs).

The United States' argument that Rohm and Haas, supra, limits only the recovery of oversight costs when such costs are sought as "removal" costs and does not address the recoverability of such costs when they fall under the category of "remedial" costs was rejected by the Third Circuit's recitation of its holding in Rohm and Haas, supra, in a 1994 decision, FMC Corp., supra, 29 F.3d at 850. In the latter case, the court summarized the Rohm and Haas, supra, holding as follows:

In our recent opinion in ... Rohm and Haas ... we held that the government could not recover from private parties the cost of government oversight of the removal and remedial activity performed and paid for by a private party. We recognized the in comparability between government and private action, and were unwilling to read CERCLA as treating government cleanups and private cleanups as equivalent actions for purposes of recovery of costs. See id. at 1277-78. We noted that it was "far more likely that Congress viewed EPA's overseeing of a private party's removal activities as qualitatively different from EPA's actually performing removal activities." Id. at 1277 (emphasis added.)

... We stated in Rohm and Haas that the government's oversight "is intended to protect the public interest rather than the interests of those being overseen," and that therefore the government could not recover its administrative costs from the regulated parties without "a clear statement of congressional intent." Id.

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