Young v. U.S.

• Decision Date: 04 January 2005
• Docket Number: No. 02-7133.,02-7133.
• Citation: 394 F.3d 858
• Parties: Jack YOUNG and Debbie Young, Husband and Wife; Dayle James and Barbara James, Husband and Wife, Plaintiffs-Appellants, v. UNITED STATES Of America; Christine Todd Whitman, Administrator of the United States Environmental Protection Agency, in her official capacity; United States Environmental Protection Agency; Gale Norton, Secretary of the Interior, in her official capacity; United States Department of the Interior; J. William McDonald, Acting Commissioner of the United States Bureau of Reclamation, in his official capacity; United States Bureau of Reclamation, an agency of the Department of the Interior; Donald Evans, Secretary of Commerce, in his official capacity; United States Department of Commerce, as successor to the Reconstruction Finance Corporation, successor to Defense Plant Corporation; and City of Henryetta, an Oklahoma municipal corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

394 F.3d 858

Jack YOUNG and Debbie Young, Husband and Wife; Dayle James and Barbara James, Husband and Wife, Plaintiffs-Appellants, v. UNITED STATES Of America; Christine Todd Whitman, Administrator of the United States Environmental Protection Agency, in her official capacity; United States Environmental Protection Agency; Gale Norton, Secretary of the Interior, in her official capacity; United States Department of the Interior; J. William McDonald, Acting Commissioner of the United States Bureau of Reclamation, in his official capacity; United States Bureau of Reclamation, an agency of the Department of the Interior; Donald Evans, Secretary of Commerce, in his official capacity; United States Department of Commerce, as successor to the Reconstruction Finance Corporation, successor to Defense Plant Corporation; and City of Henryetta, an Oklahoma municipal corporation, Defendants-Appellees.

No. 02-7133.

United States Court of Appeals, Tenth Circuit.

January 4, 2005.

COPYRIGHT MATERIAL OMITTED

Gerald L. Hilsher (Blake K. Champlin with him on the briefs) of Boone, Smith, Davis, Hurst & Dickman, Tulsa, OK, for Plaintiffs-Appellants.

Todd S. Kim (Thomas L. Sansonetti, Assistant Attorney General, Eric G. Hostetler, Angeline Purdy, and R. Justin Smith with him on the brief) of the United States Department of Justice, Washington D.C., for Federal Defendants-Appellees.

Stephen W. Smith, Henryetta, OK, for Defendant-Appellee City of Henryetta.

Before KELLY, BALDOCK, and BRISCOE, Circuit Judges.

BALDOCK, Circuit Judge.

Plaintiffs Jack Young, Debbie Young, Dayle James, and Barbara James purchased property, at a substantially reduced price, adjacent to a superfund site in Henryetta, Oklahoma. They subsequently discovered hazardous substances on their property, but did not take any action to contain or cleanup those substances. Instead, Plaintiffs sued the Federal Government and the City of Henryetta under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. §§ 9601-9675, and Oklahoma law. Plaintiffs sought to recover, among other things, the costs of responding to the hazardous substances allegedly released from the superfund site.

The district court dismissed all Plaintiffs' claims except their cost-recovery claim under CERCLA § 107(a), 42 U.S.C. § 9607(a), and then subsequently granted Defendants' motion for summary judgment on the cost-recovery claim. The court concluded Plaintiffs' cost-recovery claim failed as a matter of law because they were potentially responsible parties, or "PRPs" in CERCLA nomenclature, and therefore unable to assert a cost-recovery claim under § 107(a).¹ Plaintiffs appeal the district court's grant of summary judgment on their cost-recovery claim, arguing they are not PRPs and therefore able to maintain a cost-recovery claim under § 107(a).² We have jurisdiction, 28 U.S.C. § 1291, review the district court's grant of summary judgment de novo (applying the same standard as the district court), and affirm, albeit on different grounds. See Tate v. Farmland Indus., Inc., 268 F.3d 989, 992 n. 2 & 3 (10th Cir.2001).

I.

The material facts are undisputed. Eagle-Picher Industries, along with the Federal Government briefly during World War II, owned seventy acres of land in Henryetta. Eagle-Picher conducted smelting operations on the property. The operations contaminated the property and surrounding areas with lead and arsenic. Eagle-Picher ceased operations in 1969, demolished its smelting plant, and donated the property to the City of Henryetta. In 1996, the EPA designated the property as the "Eagle-Picher Superfund Site" and commenced an action, with cooperating state and local agencies, to cleanup the property. The agencies completed the cleanup in 1998.

Plaintiffs became interested in a 330-acre parcel of property adjacent to the Eagle-Picher Superfund Site in 1999. Plaintiffs generally knew about the EPA's cleanup actions at the superfund site; however, they never reviewed any public documents concerning the superfund site or conducted any environmental tests on the property they intended to purchase. In early 2000, Plaintiffs purchased the 330-acre parcel property adjacent to the superfund site for considerably less than its appraised value. Plaintiffs thereafter surveyed their property, hired an environmental consulting company to conduct an "abbreviated" site investigation, and hired an environmental hydrology and engineering company to assess the potential risks to humans who worked on their property. They claim the cost of such actions totaled $237,273.

Plaintiffs' actions revealed hazardous substances, including lead and arsenic, on their property. Plaintiffs also learned that a potential health risk existed for workers on their property. Plaintiffs maintain that hazardous substances continue to migrate onto their property from the superfund site. They have not, however, taken any action to contain the alleged release of, or cleanup, the hazardous substances on their property. Indeed, Plaintiffs have abandoned their property and do not intend to spend any money to cleanup the contamination.

II.

CERCLA is not a general vehicle for toxic tort claims. County Line Inv. Co. v. Tinney, 933 F.2d 1508, 1517 (10th Cir.1991) (per curiam); see also Gussack Realty Co. v. Xerox Corp., 224 F.3d 85, 91 (2d Cir.2000) (per curiam) (explaining "CERCLA does not provide compensation to a private party for damages resulting from contamination."). Instead, "Congress enacted CERCLA to facilitate the expeditious cleanup of environmental contamination caused by hazardous waste releases[,]" Daigle v. Shell Oil Co., 972 F.2d 1527, 1533 (10th Cir.1992), and to establish a "financing mechanism to abate and control the vast problems associated with abandoned and inactive hazardous waste disposal sites." Public Serv. Co. of Colo. v. Gates Rubber Co., 175 F.3d 1177, 1181 (10th Cir.1999) (internal quotations omitted). Thus, the twin aims of CERCLA are to cleanup hazardous waste sites and impose the costs of such cleanup on parties responsible for the contamination. See Meghrig v. KFC Western, Inc., 516 U.S. 479, 483, 116 S.Ct. 1251, 134 L.Ed.2d 121 (1996). The former, under the statutory scheme, must precede the latter. See Gussack Realty, 224 F.3d at 91.

CERCLA "encourage[s] private parties to assume the financial responsibility of cleanup by allowing them to seek recovery from others." FMC Corp. v. Aero Indus., Inc., 998 F.2d 842, 847 (10th Cir.1993). Specifically, CERCLA "provides two types of legal actions by which parties can recoup some or all of their costs associated with hazardous waste cleanup: cost recovery actions under § 107(a), 42 U.S.C. § 9607(a), and contribution actions under § 113(f), 42 U.S.C. § 9613(f)." United States v. Colorado & E. R.R. Co., 50 F.3d 1530, 1535 (10th Cir.1995). To establish a prima facie case under § 107(a), a plaintiff must prove (1) the site is a facility, (2) defendant is a responsible person, (3) the release or threatened release of a hazardous substance has occurred, and (4) the release or threatened release caused the plaintiff to incur necessary response costs consistent with the National Contingency Plan (NCP).³ FMC, 998 F.2d at 845.

In this case, Plaintiffs only asserted a cost-recovery claim under CERCLA § 107. We, unlike the district court, do not determine whether Plaintiffs are PRPs under § 107(a) and thus unable to assert a cost-recovery claim under the rule in this Circuit that a Plaintiff-PRP must proceed under the contribution provisions of CERCLA § 113(f) when the Plaintiff-PRP sues another PRP for response costs.⁴ See Morrison Enter. v. McShares, Inc., 302 F.3d 1127, 1133 (10th Cir.2002); Sun Co., Inc. v. Browning-Ferris, Inc., 124 F.3d 1187, 1191 (10th Cir.1997); Colorado & E. R.R. Co., 50 F.3d at 1536. Instead, we avoid the difficult question of whether Plaintiffs are PRPs because Plaintiffs' claim fails even assuming they are not PRPs and thus able to assert a cost-recovery claim under § 107(a). Plaintiffs' cost-recovery claim fails because, as discussed below, they have not incurred any response costs that are necessary and consistent with the NCP.

A.

Under CERCLA § 107(a)(4)(B), a private party may recover "any... necessary costs of response incurred ... consistent with the national contingency plan." 42 U.S.C. § 9607(a)(4)(B). A plaintiff bears the burden of proving any "response costs" were necessary and consistent with the NCP. United States v. Hardage, 982 F.2d 1436, 1447 (10th Cir.1992). "CERCLA `response costs' are defined generally as the costs of investigating and remedying the effects of a release or threatened release of a hazardous substance into the environment." Tinney, 933 F.2d at 1512 n. 7 (emphasis added) (citing 42 U.S.C. § 9601(23), (24), (25)). Thus, "response costs are ... payments by responsible parties in restitution for cleanup costs." Atlantic Richfield Co. v. American Airlines, Inc., 98 F.3d 564, 568 (10th Cir.1996). The NCP is a set of EPA regulations that "establish procedures and standards for responding to releases of hazardous substances, pollutants, and contaminants[.]" 42 U.S.C. § 9605(a); see also 40 C.F.R. §§ 300.1, 300.3.

A response cost must be "necessary to the containment and cleanup of hazardous releases." Hardage, 982 F.2d at 1448 (emphasis added); FMC, 998 F.2d at 848. "The statutory limitation to `necessary' costs of cleaning up is important. Without it there would be no check on the temptation to improve one's property and charge the expense of improvement to someone else." G.J. Leasing Co., Inc. v. Union Elec. Co., 54 F.3d 379, 386 (7th Cir.1995). Consequently, several circuit courts of appeal have concluded a response cost is only "necessary" if the cost is closely tied to the actual cleanup of hazardous releases. See Ellis v. Gallatin Steel Co., 390 F.3d 461, — , 2004 WL 2382166, *17 (6th Cir. Oct.26, 2004) (explaining only work that is "closely tied"...