US v. Union Gas Co.
| Decision Date | 03 July 1990 |
| Docket Number | Civ. A. No. 83-2456. |
| Citation | 743 F. Supp. 1144 |
| Parties | UNITED STATES of America, Plaintiff, v. UNION GAS COMPANY, et al., Defendants, v. COMMONWEALTH of PENNSYLVANIA, and the Borough of Stroudsburg, Third Party Defendants. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
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Michael M. Baylson, U.S. Atty., James G. Sheehan, Asst. U.S. Atty., Joseph J.C. Donovan, U.S.E.P.A., Philadelphia, Pa., for plaintiff.
David H. Marion, Robert A. Swift, Philadelphia, Pa., Lawrence A. Demase, Pittsburgh, Pa., C. Gary Wynkoop, Benjamin G. Stonelake, Jr., Francis X. Crowley, Philadelphia, Pa., Ralph A. Metergia, Stroudsburg, Pa., for defendant.
Presently before the court is a matter arising out of a third party suit for contribution pursuant to § 113(f) of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq. brought by Union Gas Company ("Union Gas") against the Commonwealth of Pennsylvania ("Commonwealth"). This action has leap-frogged through the federal court system, and is here on remand from the decision by the United States Supreme Court in Pennsylvania v. Union Gas Company, ___ U.S. ___, 109 S.Ct. 2273, 105 L.Ed.2d 1 (1989). Union Gas has filed a motion to dismiss the five-count counterclaim filed by the Commonwealth and a motion to strike five of the thirteen affirmative defenses raised by the Commonwealth. For the reasons discussed below, the motion to dismiss the counterclaim will be granted in part and denied in part and the motion to strike will be granted in part and denied in part.
A brief examination of the factual background and procedural course of this litigation will follow.
From 1890 to 1948, predecessors of Union Gas Company owned and operated a carburetted water gas plant near Brodhead Creek in Stroudsburg, Pennsylvania, after which time the plant was dismantled. In 1953 and 1970, Union Gas sold part of its land near the creek to Pennsylvania Power and Light Co., which then granted easements over the land to the Borough of Stroudsburg ("the Borough"). In 1955, as a result of flooding, the Commonwealth and the Borough, in conjunction with the Army Corps of Engineers, dug levees, erected dikes, narrowed and deepened the creek and redirected its flow. In early 1980, the Borough assigned its easements to the state. On October 7, 1980, the Commonwealth was excavating at Brodhead Creek when it struck a large deposit of coal tar that began to seep into the water.1 The Environmental Protection Agency ("EPA") found that this coal tar was a hazardous substance and ordered clean up of the site. The Commonwealth and the federal government jointly performed the work necessary to clean up the tar that had seeped into the water. The federal government reimbursed the Commonwealth for all its costs, expending approximately $720,000.
In 1983 the United States of America brought suit in this court against Union Gas under the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA" or "the Act"), 42 U.S.C. § 9604 and 9607 for reimbursement of $450,000 of the costs incurred in the cleanup of Brodhead Creek. The United States claimed that because the coal tar had been deposited into the ground near Brodhead Creek by Union Gas and its predecessors as a by-product of their carburetted water gas processing, the company was consequently liable for the clean up costs. Union Gas denied any liability and filed a third party complaint under CERCLA against the Commonwealth and the Borough of Stroudsburg, alleging that the third party defendants are owners and operators of the facility, and had "negligently caused, or contributed to, the discharge of coal tar into Brodhead Creek" by their recent excavation and earlier construction of dikes and levees, and therefore that they should pay for the cleanup.
On November 15, 1983, this court granted the motion to dismiss filed by the third party defendants on the grounds that the eleventh amendment barred the suit against the Commonwealth. United States v. Union Gas Co., 575 F.Supp. 949 (E.D.Pa.1983). At that time, before the enactment of amendments specifically stating that States' can be sued for damages under CERCLA, the court was unable to find in CERCLA the requisite clear language indicating that Congress intended to abrogate States' immunity.
Shortly thereafter, the United States filed an amended complaint against Union Gas, revising the damage figures and alleging that $720,000 of the $1,400,000 spent by the United States was collectible from Union Gas under CERCLA.
This court was next presented with a motion for summary judgment filed by Union Gas, in which the company argued that the coal tar constituents at issue in this case are not hazardous substances within the meaning of CERCLA. On May 30, 1984, this court denied the motion, holding that acenaphthene, ethylvenzene, flouranthene, phenanthrene, pyrne, napthalene and xylene, are hazardous substances under CERCLA, by reason of CERCLA'S definition section, 42 U.S.C. § 9601(14)(A) and (D). See United States v. Union Gas Co., 586 F.Supp. 1522 (E.D.Pa.1984).
Union Gas then filed an amended third party claim against the Commonwealth and Borough. The state again moved to dismiss, and on September 13, 1984, this court granted the motion on eleventh amendment grounds for the reasons set forth in 575 F.Supp. 949.
Several months later, on February 4, 1985, this court dismissed the federal government's action against Union Gas pursuant to Rule 23(b) of the Local Rules of Civil Procedure of the Eastern District of Pennsylvania, based on its understanding that the United States and Union Gas had reached a settlement.2 Union Gas then appealed this court's granting of the Commonwealth's motion to dismiss Union Gas's third party complaint. On appeal, the United States Court of Appeals for the Third Circuit affirmed this court's ruling, holding that CERCLA did not evince congressional intent to abrogate the states' eleventh amendment immunity. See United States v. Union Gas Co., 792 F.2d 372 (3d Cir.1986). (Union Gas I). Following the Union Gas I ruling, Congress enacted the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), Pub.L. 99-499. The United States Supreme Court vacated and remanded the case for further consideration by the Third Circuit in light of the enactment of SARA. Union Gas Co. v. Pennsylvania, 479 U.S. 1025, 107 S.Ct. 865, 93 L.Ed.2d 821 (1987).
On remand, the Third Circuit reversed the district court's judgment, and concluded that, in contrast to the legislative language of CERCLA upon which the court based its decision in Union Gas I, SARA provided CERCLA with the requisite unmistakably clear language needed to abrogate the States' eleventh amendment immunity. The court further held that in enacting SARA pursuant to its Article I commerce clause powers (as opposed to its Fourteenth amendment power), Congress possessed the constitutional power to abrogate the states' sovereign immunity. See United States v. Union Gas Co., 832 F.2d 1343 (3d Cir.1987) (Union Gas II). On writ of certiorari, the United States Supreme Court affirmed the Third Circuit's opinion in Union Gas II, holding that the language of CERCLA as amended by SARA clearly evinces an intent to hold States liable for damages in federal court and that Congress has the authority to render States so liable when legislating pursuant to the Commerce Clause.
The Supreme Court of the United States having laid to rest the issue of sovereign immunity and having remanded the case, this court now has before it the merits of the underlying third party claim. After the ruling by the Supreme Court, on December 29, 1989, Union Gas filed a second amended and supplemental third party claim ("third party complaint") for contribution. Although the allegations in the third party complaint parallel the facts discussed above, some of them bear repeating. Union Gas alleges that between 1960 and 1962 the Commonwealth directed and paid for the relocation and narrowing of Brodhead Creek and the construction of dikes adjacent to the site where the coal gasification plant had operated. Union Gas further alleges that the Borough of Stroudsburg obtained a permanent easement over the lands adjoining the creek and in 1980 conveyed title to the Commonwealth, which already owned the stream bed. By 1980, Union Gas claims that the stream bed had steadily eroded and dropped by ten feet as a result of the narrowing and containment of the creek, and that the Commonwealth failed to take necessary corrective action to prevent the seepage of coal tar into the environment.
In Count I of the third party complaint Union Gas alleges that the Commonwealth is an owner and operator within the meaning of CERCLA, and caused the alleged release and discharge of coal tar into the creek by its acts and omissions and/or negligence, including, inter alia, (a) relocating the stream closer to the site of the former coal gasification plant; (b) narrowing the channel of Brodhead Creek and constructing the channel with dikes; (c) failing to maintain the integrity of the toe of the dike; and (d) excavating along the toe of the dike and releasing coal tar. In Count I, Union Gas seeks to recoup pursuant to 42 U.S.C. § 9607(a) and § 9613(f) from the Commonwealth $700,000 it paid to the United States on August 5, 1989 in settlement of the claims alleged in the amended complaint and $300,000 it expended to perform a remedial investigation and feasibility study (RI/FS) required by the state. In Count II, Union Gas claims that the Commonwealth is liable to Union Gas, as subrogee of the United States pursuant to 42 U.S.C. § 9612(c)(2), to the extent of $700,000 of the total cleanup costs incurred.
The Commonwealth filed an answer and counterclaim...
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