US v. Union Elec. Co., 1:92CV00078GFG

• Decision Date: 19 August 1994
• Docket Number: 1:92CV00088GFG.,No. 1:92CV00078GFG,1:92CV00078GFG
• Citation: 863 F. Supp. 1001
• Parties: UNITED STATES of America, Plaintiff, v. UNION ELECTRIC COMPANY, et al., Defendants. STATE OF MISSOURI, Plaintiff, v. UNION ELECTRIC COMPANY, et al., Defendants.
• Court: U.S. District Court — Eastern District of Missouri

863 F. Supp. 1001

UNITED STATES of America, Plaintiff, v. UNION ELECTRIC COMPANY, et al., Defendants.

STATE OF MISSOURI, Plaintiff, v. UNION ELECTRIC COMPANY, et al., Defendants.

Nos. 1:92CV00078GFG, 1:92CV00088GFG.

United States District Court, E.D. Missouri, Southeastern Division.

August 19, 1994.

Madeline B. Cole, Office of U.S. Atty., St. Louis, MO, Barry M. Hartman, U.S. Dept. of Justice, Washington, DC, Sarah Toevs-Sullivan, U.S. EPA, Region VII, Kansas City, MO, Amy Svoboda, U.S. EPA, Office of Enforcement, Washington, DC, for U.S.

John F. Cowling, George M. Von Stamwitz, Armstrong and Teasdale, Alphonse McMahon, Peper and Martin, St. Louis, MO, for Union Elec. Co.

Alphonse McMahon, Peper and Martin, St. Louis, MO, for all other defendants.

Alphonse McMahon, Peper and Martin, St. Louis, MO, Warren D. Krebs, Parr and Richey, Indianapolis, IN, for Wayne-White Counties Elec. Co-op.

Joseph G. Nassif, Sr., Partner, Bruce D. Ryder, Partner, Linda W. Tape, Associate, Coburn and Croft, St. Louis, MO, for intervenor plaintiffs.

Shelley A. Woods, Asst. Atty. Gen., Jefferson City, MO, for the State of Mo.

ORDER AND MEMORANDUM

GUNN, District Judge.

This matter is before the Court on parties' motions to intervene and deny entry of consent decree, and on the United States' motion to enter consent decree.

I. Background

In June 1992, the United States filed suit against 179 potentially responsible parties (PRPs) for injunctive relief and the recovery of costs for the cleanup of the Missouri Electric Works, Inc. Superfund Site (Site) pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. §§ 9606, 9607. During the following month, the State of Missouri filed suit against the same 179 PRPs. The two cases were subsequently consolidated.

The United States also lodged a consent decree with the Court, which had been executed by the United States, the State of Missouri, and the 179 PRPs. Notice of the consent decree was published in the Federal Register on July 14, 1992, and a 30-day period of public comment followed. At that time, some non-settling PRPs voiced their objections to the consent decree. Then, on November 5, 1992, some non-settling PRPs (hereinafter the Intervenors) filed a motion to intervene and a motion to deny entry of the consent decree.

The Superfund Site at issue is located in Cape Girardeau, Missouri, and is owned by Missouri Electric Works, Inc., (MEW) an electrical equipment sale and repair shop. Apparently, solvents, hazardous chemicals, and electrical equipment, including thousands of transformers containing oil, contaminated with polychlorinated biphenyl (PCB), had been disposed of at the MEW Site, adjacent to the shop.

The Environmental Protection Agency's (EPA) investigations of the Site began in the mid-1980s, and in 1988, EPA and a group of PRPs formed the Missouri Electric Works Steering Committee (MEWSC) through an Administrative Order on Consent to conduct a remedial investigation/feasibility study at the MEW Site. From 1988-1991, EPA sent general notices to all PRPs. EPA also sent special notice letters inviting PRPs to participate in settlement negotiations. From March until September of 1991, the federal government, the state of Missouri, and MEWSC negotiated the terms of a consent decree. EPA sent a copy of the proposed decree to all PRPs and invited their participation at the end of September, 1991.

The Intervenors are service shop owners¹ who either sold transformers directly to MEW for resale, sold transformers to third parties who resold them to MEW or sent transformers owned by others to MEW for repair. They are unwilling to join in the consent decree because they believe that the formula developed by MEWSC for allocating the cost of cleanup inequitably attributes to them a disproportionate share of liability.

II. Motion to Intervene

The Intervenors claim that they are entitled to intervene as a matter of right pursuant to either CERCLA § 113(i) or Rule 24(a)(2). 42 U.S.C. § 9613(i) (1988); Fed. R.Civ.P. 24(a). Alternatively, they ask this Court in its discretion to allow intervention pursuant to Rule 24(b). Fed.R.Civ.P. 24(b).

A. Intervention of Right

Intervention of right can occur in one of two ways. First, under Rule 24(a)(2), a party can intervene as a matter of right "upon timely application ... when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties."

Second, a party can intervene as a matter of right pursuant to Rule 24(a)(1) "upon timely application ... when a statute of the United States confers an unconditional right to intervene." In this case, the statutory conferral can be found in CERCLA § 113(i), which mandates intervention "when such person claims an interest relating to the subject of the action, and is so situated that the disposition of the action may, as a practical matter, impair or impede the person's ability to protect that interest, unless the President or the State shows that the person's interest is adequately represented."

The showings required by Rule 24(a)(1) and CERCLA § 113(i) are materially identical; they differ only in that CERCLA shifts the burden of proof to the government regarding adequate representation. Both require that the intervenor have an "interest" in the lawsuit. The "interest" must be "more than peripheral or insubstantial; the applicant must assert a `significantly protectable interest.'" Planned Parenthood of Minnesota, Inc. v. Citizens for Community Action, 558 F.2d 861, 869 (8th Cir.1977), citing Donaldson v. United States, 400 U.S. 517, 531, 91 S.Ct. 534, 542, 27 L.Ed.2d 580 (1971).

The Intervenors argue that their interest stems from CERCLA § 113(f). Section 113(f)(1) provides that "any person may seek contribution from any other person who is liable or potentially liable" under CERCLA § 107. The non-settling Intervenors describe their interest as a right of contribution against the settling defendants which will be impaired by the entry of the consent degree because § 113(f)(2) protects a PRP who enters into an approved settlement with the government from contribution claims regarding any matters addressed in the settlement.

A claim for contribution under CERCLA is simply not a "significantly protectable interest" in light of the structure and design of CERCLA as a whole. Congress designed CERCLA to promote early settlements by rewarding those who settle with immunity from contribution claims and by saddling those who do not settle with potentially disproportionate joint and several liability for any amounts remaining. State of Arizona v. Motorola, Inc., 139 F.R.D. 141, 145 (D.Ariz.1991), citing United States v. Cannons Engineering Corp., 899 F.2d 79, 91 (1st Cir.1990). See also United States v. ABC Indus., 153 F.R.D. 603 (W.D.Mich. 1993). Allowing non-settling PRPs to intervene would thwart the very settlements that CERCLA encourages.

In addition, the contribution claims of non-settling PRPs are too speculative and contingent. United States v. Alcan Aluminum, Inc., 25 F.3d 1174, 1184 (3rd Cir.1994). The extent of the non-settling PRPs' liability is not yet known (indeed, the Intervenors in this case hotly contest any CERCLA liability on their part). Such claims are contingent upon a finding of liability at some future proceeding not yet initiated.

While the Eighth Circuit has recognized that some contingent interests may support intervention under Rule 24(a)(2), the issue has not been addressed in the context of CERCLA. SEC v. Flight Transp. Corp., 699 F.2d 943 (8th Cir.1983); Planned Parenthood of Minnesota, Inc. v. Citizens for Community Action, 558 F.2d 861 (8th Cir.1977). Furthermore, there are limits to the sufficiency of contingent interests: "The intervenor cannot rely upon an interest which is wholly remote and speculative." SEC v. Flight Transp. Corp., 699 F.2d at 948. In this case, the Intervenors' interest is contingent upon litigation which has not begun and may never be pursued, the outcome of which may or may not result in liability attributable to the Intervenors. This degree of contingency cannot justify intervention in light of the overall structure of CERCLA. To allow the intervention of non-settling PRPs for the purpose of hindering consent decrees with other parties would subvert CERCLA's encouragement of settlement agreements.

The Intervenors rely heavily on United States v. Acton Corp., 131 F.R.D. 431 (D.N.J. 1990). In Acton, the court allowed non-settling PRPs to intervene in suit between the United States and some settling PRPs in order to challenge the proposed consent decree; the intervenors had already been sued by the federal government under CERCLA. The Acton court found the language of § 113(i) to give unambiguously a right of intervention to "any person" who satisfies the section's requirements. The court explained that the contribution claim given by § 113(f)(1) is a "statutory right" sufficient for intervention. Id. at 434. The court noted that the parties should be able to intervene in order to protect that right from being extinguished by CERCLA § 113(f)(2) with the entry of the consent decree. Id. at 433-34.

Asserting that § 113(i) is unambiguous, the Acton court refused to consider not only legislative history suggesting that Congress did not intend to permit dissatisfied non-settlers to intervene in order to challenge the entry of CERCLA consent decrees, but also the structure of CERCLA as a whole. Id. at 433. The Supreme Court has explained that "when construing the `plain meaning' of a statute, a court must read the particular statutory language at issue in light of the language and design of the statute as a...