REVISED
United States Court of Appeals,
Fifth Circuit.
No. 96-30714.
OHM REMEDIATION SERVICES, Plaintiff-Counter Defendant-Cross
Defendant-Appellant,
v.
EVANS COOPERAGE CO., INC., Defendant-Third Party Plaintiff-
Counter Claimant-Cross Defendant Counter Defendant-Appellee,
Louisiana Oil Recycle/Reuse, Inc.; Coastal Leasing Services,
Inc.; Henrietta McCrary; Francis' Drilling Fluid, Inc.; Power
Tool Repair Service, Inc.; American Inspection and Testing
Laboratories, Inc.; American Manufacturing Company, Inc.; Atlas
Processing Co.; Aviation Laboratories Inc.; Boassa International
Inc.; Cabot Corporation; Caleb Brett USA; Castrol Inc.;
Catalyst Recovery of Louisiana Inc.; Cherry Picker Parts & Service
Company, Inc.; Cheyenne Services, Inc.; Conoco Inc.; Daniel Oil
Tools Co.; De Nova Oil and Gas, Drilling Measurements Inc.; Dravo
Lime Company; Dresser Industries Inc.; Dwaca Enterprises; Ebasco
Services, Inc.; Fruehauf Trailer Corporation; Howell Industries;
Iew Systems Inc.; Independent Tank Cleaning Services Inc.;
Ingersoll Rand Co.; Koch Service Inc.; KRC Southern Inc.; L & B
Transportation; Louisiana Bulk Carriers Inc.; Matlack Inc.;
Quality Diesel Service Inc.; Richard Oil Co.; Rubicon
Incorporated; Sabine Manufacturing; Saybolt Inc.; Schuylkill
Metals; Southern Natural Gas Company; Stupp Brothers Bridge and
Iron Company; Tube Alloy Corp.; Valley Electric Membership
Corporation; Verret Shipyard Inc.; Westlake Polymers Corp., Third
Party Defendants-Cross Defendants-Appellees,
Atlas Wireline; Dresser Pump; Geismar Marine Inc.; Greenville
Johnny of Louisiana Inc.; Intercoastal Truck; LA Interstate
Liquids Inc.; N L McCullough Industries; Novi Chemical; Southern
Pipe; Southern Scrap Metals Inc., Appellees,
Acadian Ambulance Service Inc., Third Party Defendant-Cross
Defendant-Third Party Plaintiff-Cross Claimant-Counter Claimant-
Counter Defendant-Appellee,
T T Barge Cleaning Inc., Third Party Defendant-Cross Defendant-
Third Party Plaintiff-Cross Claimant-Counter Claimant-Appellee,
1
Florida Parishes Voc-Tech School, Third Party Defendant-Cross
Claimant-Counter Claimant-Cross Defendant-Appellee,
CCL Custom Manufacturing Inc.; Cedar Chemical Corp.; BP
Exploration and Oil Inc.; Constar Plastics Inc.; DSI Transports
Inc.; International Paper Company; Louisiana Industries;
Occidental Chemical Corporation; Oxy USA Inc.; Port Allen River
Plant Inc., Third Party Defendants-Counter Claimants-Cross
Defendants-Appellees,
Coastal Fluid Technologies Inc.; Deep South Chemical; MacKenzie
Corporation, Third Party Defendants-Appellees,
Koch Service Inc., Third Party Defendant-Cross Claimant-Appellee,
July 22, 1997.
Appeals from the United States District Court for the Middle
District of Louisiana.
Before EMILIO M. GARZA, PARKER and DENNIS, Circuit Judges.
EMILIO M. GARZA, Circuit Judge:
OHM Remediation Services appeals the district court's
dismissal of its action to recover response costs under the
Comprehensive Environmental Response, Compensation and Liability
Act ("CERCLA"), 42 U.S.C. §§ 9607 and 9613. In a case posing two
issues of first impression in the federal courts of appeal
regarding the response cost recovery and contribution provisions of
CERCLA, we reverse and remand.
I
The relevant facts here are not in dispute. Louisiana Oil
Recycle and Reuse ("Louisiana Oil") operated a facility in Baton
Rouge that recycled nonhazardous waste. In a critical two-year
period, Evans Cooperage sent at least seventy-six shipments of
waste materials, the total volume of which exceeded 450,000
2
gallons, to Louisiana Oil for treatment or disposal. At some point
after these shipments, a hazardous substance began escaping from
the Louisiana Oil facility, flooding the grounds of adjacent
property and spilling into the Baton Rouge storm sewer system. The
Louisiana Department of Environmental Quality ("DEQ") ordered
Louisiana Oil to take immediate action. Louisiana Oil contacted
OHM the same day, and over the next three months OHM contained the
release and recovered the spilled materials. According to the DEQ,
OHM's work successfully abated the emergency situation at the
facility and left the site in a secure condition. At no point was
OHM's relationship with Louisiana Oil anything other than
contractual; OHM has never had any ownership or leasehold interest
in the Louisiana Oil facility.
The DEQ shut Louisiana Oil down after issuing an order finding
that the materials spilled were "hazardous waste, namely hazardous
washwater which failed the characteristic test for corrosivity and
for chromium and lead." After it was shut down, Louisiana Oil went
out of business, and its insurance did not cover OHM's $3 million
bill for response costs. As Louisiana Oil was unable to pay for
its services, OHM sued Evans for recovery of clean-up costs under
CERCLA section 107(a), 42 U.S.C. § 9607(a). Evans named several
potentially responsible parties ("PRPs") as third-party defendants,
and two of these companies named numerous other parties as
third-party defendants. Based on documents obtained from Louisiana
Oil, the total number of third-party co-defendants eventually
3
reached seventy, including OHM, which had delivered ten drums of
waste to Louisiana Oil in 1991. Although OHM did not admit that
the material it sent to Louisiana Oil was hazardous, nor that the
ten drums made OHM a potentially responsible party under the
statute, the company brought a contribution action against the
third-party defendants under CERCLA section 113(f), 42 U.S.C. §
9613(f).
Evans filed a motion to dismiss under Fed.R.Civ.P. 12(b)(6),
part of which the district court converted to a motion for summary
judgment and granted. The court dismissed OHM's section 107(a)
claims on summary judgment, holding that the language of the
statute implies that one must have a "protectable interest" in the
clean-up site to recover response costs. Because OHM had no such
interest in the Louisiana Oil site, the district court held that
OHM could not bring an action under section 107(a). The district
court also granted the Evans's motion to dismiss OHM's section
113(f) claims, holding: (1) that OHM could not maintain a section
113(f) contribution action because it had not shown that the
defendants were "liable or potentially liable" in its original
section 107(a) claim, and (2) that, in any event, OHM could not
bring a contribution claim unless the company admitted that it was
jointly and severally liable as a potentially responsible party.
OHM appealed.
II
Congress enacted CERCLA in 1980, and amended it in 1986 by
4
the Superfund Amendments and Reauthorization Act ("SARA").
CERCLA's broad, remedial purpose is to facilitate the prompt
cleanup of hazardous waste sites and to shift the cost of
environmental response from the taxpayers to the parties who
benefitted from the wastes that caused the harm. Matter of Bell
Petroleum Services, Inc., 3 F.3d 889, 894 (5th Cir.1993) (citing
United States v. R.W. Meyer, Inc., 889 F.2d 1497, 1500 (6th
Cir.1989), cert. denied, 494 U.S. 1057, 110 S.Ct. 1527, 108 L.Ed.2d
767 (1990)). CERCLA section 107(a) provides for the recovery of
response costs from all persons responsible for the release of a
hazardous substance. Response actions include both "remedial" and
"removal" actions. Bell Petroleum, 3 F.3d at 894. Removal actions
generally are immediate or interim responses, and remedial actions
generally are permanent responses. Id. These response actions may
be undertaken by the United States, any state, an Indian tribe, or
"any other person" under section 107(a)(4)(A)-(B).
CERCLA makes four classes of "covered persons" liable for
response costs: (1) present owners and operators of facilities
that accepted hazardous substances, (2) past owners and operators
of such facilities, (3) generators of hazardous substances, and (4)
certain transporters of hazardous substances. CERCLA § 107(a).
The Act's broad reach extends liability all the way down the causal
chain, from those who generate waste through those who dispose of
it. See, e.g., B.F. Goodrich Co. v. Murtha, 958 F.2d 1192, 1198
5
(2d Cir.1992). Because the Act imposes strict liability, Bell
Petroleum, 3 F.3d at 897, plaintiffs generally need not prove
causation, only that the defendant is a "covered person." United
States v. Alcan Aluminum Corp., 990 F.2d 711, 721 (2d Cir.1993).
Where the harm is indivisible, liability under the Act is joint and
several. Bell Petroleum, 3 F.3d at 903. Responsible parties are
liable for a broad range of expenses, including all costs of
removal of substances consistent with the National Contingency Plan
("NCP"), damages for injury to natural resources, the cost of
health assessments, and all other necessary response costs. CERCLA
§ 107(a)(4).
The NCP, a set of guidelines drafted by the Environmental
Protection Agency, governs site cleanup and response actions under
CERCLA. 40 C.F.R. Part 300. The NCP sets performance standards,
identifies methods for investigating the environmental impact of a
release or threatened release, and establishes criteria for
determining the appropriate extent of response activities. Bell
Petroleum, 3 F.3d at 894.
In addition to the cost recovery provisions of section 107(a),
CERCLA section 113(f) provides for contribution from "any other
person who is liable or potentially liable under section [107(a)
]." Section 113(f) allows courts to "allocate response costs among
liable parties using such factors as the court determines are
appropriate." CERCLA § 113(f)(1).
6
III
A
First, we address whether recovery of response costs under
section 107(a) is restricted to persons with a "protectable
interest" in the cleanup site. The district court dismissed OHM's
section 107 claim on a motion for summary judgment, holding that,
in order to satisfy the "statutory causation" requirement of the
statute, the claimants must have a "protectable interest" in the
property. We review a district court's grant of summary judgment
de novo. Doddy v. Oxy USA, Inc., 101 F.3d 448, 460 (5th Cir.1996).
In doing so, we employ the same criteria as the district court and
construe all facts and inferences in the light most favorable to
the nonmoving party. Id. Summary judgment is appropriate where the
moving party establishes that "there is no genuine issue of
material fact and that [it] is entitled to a judgment as a matter
of law." Fed.R.Civ.P. 56(c). This appeal involves no question of
fact, only a question of law.
The relevant part of section 107(a), including the causation
requirement, provides that any "covered person" with respect to a
facility or site:
from which there is a release, or a threatened release which
causes the incurrence of response costs, of a hazardous
substance, shall be liable for—
(A) all costs of removal or remedial action incurred by
the United States Government or a State or an Indian
tribe not inconsistent with the national contingency
plan;
7
(B) any other necessary costs of response incurred by any
other person consistent with the national contingency
plan; ...
CERCLA § 107(a)(4) (emphasis added). The district court determined
that the word "causes" implies a requirement of connection between
the plaintiff and the property satisfied only by an interest in the
site. It held that the spill only "caused" response costs for
Louisiana Oil, but did not cause the actions or costs of Louisiana
Oil's contractors. According to this interpretation of section
107(a), OHM would presumably have a cause of action sounding in
contract against Louisiana Oil, who in turn could recover from
potentially liable parties ("PRPs") under CERCLA. Such a reading
of CERCLA would effectively bar independent contractors such as OHM
from recovering response costs under section 107(a).
This protectable interest requirement is nowhere in the
statute, and we decline to insert it. The text of section 107 does
not limit the class of plaintiffs who may recover response costs;
the only descriptions of who may recover are "the United States
Government or a State or an Indian tribe" in section 107(a)(4)(A)
and "any other person" in section 107(a)(4)(B). Far from a
limitation, the combination of these two clauses in section 107
evidences congressional intent that anyone is eligible to recover
response costs. In addition, we have been unable to find any
legislative history in CERCLA or the SARA amendments suggesting
that Congress ever intended such a "protectable interest" inquiry.
8
To read the word "causes" to include a requirement of a
protectable interest confounds even a commonsense reading of
section 107. The word "causes" in section 107(a)(4) applies to
costs incurred by the government under 107(a)(4)(A) and by
individuals under 107(a)(4)(B), so under the district court's
reading, the causation requirement would constrain the government
as well. Congress surely did not require the government to have a
protectable interest in any Superfund site for which it incurs
response costs, and it makes little sense to infer that requirement
for private parties. We have never required a showing of such an
interest as an element of section 107 recovery actions. In Bell
Petroleum, for example, we held that the Environmental Protection
Agency could recover the costs it incurred removing chromium from
the Trinity Aquifer near Odessa, Texas. 3 F.3d at 907-09. Neither
the EPA nor the United States has a "protectable interest" in the
aquifer, and we did not require one. To the contrary, we have held
that "a plaintiff who has incurred response costs meets the
liability requirement as a matter of law if it is shown that any
release violates, or any threatened release is likely to violate,
any applicable state or federal standard, including the most
stringent." Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 671 (5th
Cir.1989) (emphasis added).
Evans argues that the spill did not "cause" OHM's response,
but that a contract with Louisiana Oil caused OHM's response costs.
9
This is essentially a request that the court graft a rule of
privity onto CERCLA, allowing only the property owner to recover
under the statute. However, the statute does not adopt such a
cramped view of causation. In the case at hand, if no release had
occurred, OHM would not have had to incur response costs cleaning
up the site. In that respect, the spill "caused" OHM's response
costs. The statute does not require OHM to show that it has any
more substantial relationship to the property than it does in this
case.
In short, section 107(a) does not impose a "protectable
interest" limitation on who may recover response costs, and such a
limitation is not fairly implied by the text of the statute, by the
legislative history, or by reading the statute as a whole. In
light of the clear intention of Congress to provide a private right
of action to "any other person" for recovery of response costs, we
decline to exclude by implication those without a protectable
interest in the cleanup site. No other court of appeals has
curtailed CERCLA recovery in this way, and we decline to do so
today.
B
Next, we address whether section 113(f) contribution actions
may be brought by a party that is not liable or potentially liable.
After dismissing OHM's section 107(a) claim against Evans, the
district court dismissed OHM's section 113(f) contribution claim
against the third-party defendants on two independent grounds.
10
First, the court noted that section 113(f) allows actions against
third parties only after an initial determination of liability
under section 107(a). Section 113(f)(1) provides that "[a]ny
person may seek contribution from any other person who is liable or
potentially liable under section [107(a) ] of this title, during or
following any civil action under section 9606 of this title or
under section [107(a) ] of this title." A section 113(f)
contribution action is derivative of an action under section
107(a), if only a pending one. Accordingly, the district court's
dismissal of OHM's section 107(a) action served to void the
statutory prerequisite to suit under section 113(f). However, in
the prior section of this opinion, we reversed the district court's
dismissal and remanded OHM's section 107(a) claim to the district
court for determination. OHM still has a viable section 107(a)
claim pending in the district court, and therefore the district
court's first rationale for dismissing the company's section 113(f)
claims no longer holds.
The district court held, in the alternative, that a section
113(f) claim for contribution may only be brought by a party that
is liable or potentially liable under the statute. OHM does not
concede that the ten drums of waste it deposited with Louisiana Oil
in 1991 were hazardous, nor does it admit that it is potentially
responsible for cleanup costs, and the district court has not made
any findings of liability. Instead of admitting that it is a PRP,
OHM argues that section 113(f) actions may be brought by non-PRP
11
claimants.
1
Section 113(f)(1) reads in relevant part:
Any person may seek contribution from any other person who is
liable or potentially liable under section 9607(a) of this
title, during or following any civil action under section 9606
of this title or under section [107(a) ] of this title.... In
resolving contribution claims, the court may allocate response
costs among liable parties using such equitable factors as the
court determines are appropriate.
CERCLA § 113(f)(1) (emphasis added). The statute allows that
"[a]ny person" may seek contribution, but this must be read in
conjunction with the statute's description of who is liable: "any
other person." "Other" in this section refers back to the person
seeking contribution, and changes our understanding of who might
fill that role.
The ambiguity in section 113(f) rides on the proper
interpretation of the word "other." If, as OHM suggests, we read
"other" to modify only the single word following it, "person," the
word does nothing more than prevent the plaintiff from suing
himself for contribution. Such a reading would effectively mean,
"Any person may seek contribution from any other person in the
world, so long as the person from whom contribution is sought is
liable or potentially liable...." Under such a reading, section
113(f) would essentially parrot section 107(a), allowing anyone to
recover response costs from a PRP. However, if one reads the word
"other" to modify "person who is liable or potentially liable," as
12
the district court did in this case, the phrase implies that the
person seeking contribution must be liable also. Such a reading
construes the statute to say, "Any person who is liable or
potentially liable may seek contribution from any other person who
is liable or potentially liable...."
The rest of section 113 indicates that contribution actions
are appropriate only to settle disputes among PRPs, allowing the
court to "allocate response costs among liable parties " using
equitable factors. Indeed, although we have never held as much, we
have suggested in dictum that section 113(f) actions may only be
brought among potentially responsible parties: "Under CERCLA, a
defendant has contribution rights only against other defendants who
have not resolved their liability in an administrative or
judicially approved settlement." Bell Petroleum, 3 F.3d at 902 n.
14; see also Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 672 (5th
Cir.1989) ("When one liable party sues another to recover its
equitable share of the response costs, the action is one for
contribution....").
The legislative history of CERCLA reinforces the conclusion
that only PRPs may bring actions for contribution. Section 107 was
the sole statutory basis for recovery of response costs in the
original CERCLA statute, which contained no provision for
apportioning costs among PRPs. Cases under the original statute
threatened minor polluters with joint and several liability, which
13
prompted courts to find an implicit, federal common law right to
contribution. See County Line Inv. Co. v. Tinney, 933 F.2d 1508,
1515 (10th Cir.1991); O'Neil v. Picillo, 883 F.2d 176, 179 (1st
Cir.1989), cert. denied, 493 U.S. 1071, 110 S.Ct. 1115, 107 L.Ed.2d
1022 (1990); Mardan Corp. v. C.G.C. Music, Ltd., 804 F.2d 1454,
1457 n. 3 (9th Cir.1986). The SARA amendments, including section
113, codified the federal common law right of contribution. See
United Technologies Corp. v. BFI, Inc., 33 F.3d 96, 98 (1st
Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 1176, 130 L.Ed.2d
1128 (1995). A principal objective of the new contribution
provision was to "clarif[y] and confirm[ ] the right of a person
held jointly and severally liable under CERCLA to seek contribution
from other potentially liable parties, when the person believes
that it has assumed a share of the cleanup or cost that may be
greater than its equitable share under the circumstances." S.Rep.
No. 11, 99th Cong., 1st Sess. 44 (1985). The legislative history
thus supports the idea that section 113(f) was not meant to be
duplicative of section 107(a), but meant instead to allow
potentially responsible parties a cause of action to mitigate the
harsh effects of joint and several liability.
Few cases have addressed the specific question of whether a
non-PRP has a cause of action under section 113(f). In the only
case we have found directly on point, Companies for Fair Allocation
v. Axil Corp., a district court in Connecticut held that the plain
14
language of the statute said that "[a]ny person" could sue for
contribution, so the claimant need not be a PRP: "Although the
statute provides that contribution may only be sought from parties
who are liable or potentially liable, the statute imposes no such
liability requirement on parties seeking contribution." Axil, 853
F.Supp. 575, 581 (D.Conn.1994).
The First Circuit has reached the opposite result, on
different procedural footing, in United Technologies v. BFI, 33
F.3d 96, 100-02 (1st Cir.1994). In interpreting section 113, the
United Technologies court employed a canon of statutory
construction, that legal terms used in framing a statute are
ordinarily presumed to convey their customary legal meaning, to
find that section 113(f) is meant to apportion costs among PRPs.
Id. at 99.1 We agree that "contribution," as that word is used in
CERCLA, is best understood in its customary sense as a term of art
referring to actions brought among potentially responsible parties.
Black's Law Dictionary defines "contribution" as:
Right of one who has discharged a common liability to recover
of another also liable, the aliquot portion which he ought to
pay or bear. Under principle of "contribution," a tort-feasor
against whom a judgement is rendered is entitled to recover
proportional shares of judgment from other joint tort-feasors
whose negligence contributed to the injury and who were also
liable to the plaintiff.
We express no opinion on the separate question addressed by
the United Technologies court, whether a PRP may seek to hold other
parties jointly and severally liable under section 107(a) for
response costs.
15
Black's Law Dictionary 328 (6th ed.1990). The United Technologies
court concluded that the structure of the statute, including
separate limitations periods for section 107 and section 113,
indicate that "contribution" in section 113 "refers to an action by
a responsible party to recover from another responsible party that
portion of its costs that are in excess of its pro rata share of
the aggregate response costs...." United Technologies, 33 F.3d at
103. We agree, and we hold that section 113(f) contribution
actions may only be brought by persons who are liable or
potentially liable under CERCLA.
2
No court has determined that OHM is actually liable under the
statute, and the company disputes its liability, presumably because
of the de minimis nature of its contribution and its remoteness in
time from the actual release. Further, OHM denies that it is even
potentially liable, claiming that it is not a PRP. Therefore OHM's
own pleadings threaten to extinguish its section 113(f)
contribution claims.
The terms "liable or potentially liable" and "potentially
responsible party" (or PRP), are not defined in the statute.
However, after examining the text and the structure of CERCLA, we
think that the most sensible reading of the statute demands that,
even before any determination of actual liability, a party may be
"potentially liable" simply by being sued under the statute. Cf.
16
Amcast Industr. Corp. v. Detrex Corp., 2 F.3d 746, 748-49 (7th
Cir.1993) (once sued, a party may bring a counterclaim for
contribution without admitting liability under CERCLA). The courts
may eventually clear a CERCLA defendant or third-party defendant
from liability; but until it does, such a defendant is at least
potentially liable.
This interpretation of potential liability under section 113
allows parties to bring contribution actions at least as soon as
they are sued under CERCLA.2 By allowing parties to bring
contribution claims before any finding or stipulation of liability,
CERCLA makes possible the joinder of all potentially responsible
parties in a single case, an early identification of potentially
responsible parties for purposes of settlement, and as a single
judicial apportionment of cleanup costs among responsible parties.
Such a reading also allows parties to bring contribution actions
after settlements, stipulations, or judicial determination of
liability, within the three-year limitations period. Therefore we
hold that, regardless of whether the company stipulates any
responsibility for the spill, and before any court determines
ultimate liability, OHM is nonetheless a potentially liable party
by virtue of its status as a defendant in the suit.3
We express no opinion as to whether a party may be considered
a PRP before being sued under CERCLA.
We note that there may be significant overlap between OHM's
contribution claims and its 107(a) claims for response costs
17
We hold that the language of CERCLA permits only PRPs to bring
contribution actions under section 113(f), but that OHM is a PRP
under the statute because it is a defendant in the suit. Therefore
we reverse each of the district court's alternative grounds for
dismissal of OHM's section 113(f) contribution claims as a matter
of law and remand for further proceedings.
IV
Evans presents three independent grounds for summary judgment
not addressed by the district court by which we may dismiss OHM's
revived section 107(a) claim. First, Evans asserts that, because
OHM is actually liable under the statute as a PRP, the company may
not bring an action under section 107(a). Second, Evans disputes
whether OHM may recover response costs, because it asserts that the
Louisiana Oil project was not a "CERCLA quality" cleanup. Third,
Evans charges that the work was not consistent with the NCP. We
need not address those issues here. All involve difficult
questions of fact regarding the extent of cleanup and the nature of
OHM's involvement with the site. These questions should be decided
by the district court on a record more complete than the one
available to us here.
Therefore we REVERSE the district court's dismissal of OHM's
section 107(a) claim, as well as its dismissal of OHM's section
against the same defendants, but CERCLA imposes no bar on multiple
grounds for recovery. We also note that if the district court
finds that OHM is not liable for response costs, the company
obviously will cease to be a liable or potentially liable party.
18
113(f) contribution claims and REMAND both claims to the district
court.
19