United States v. General Electric Co.

United States Court of Appeals
For the First Circuit

No. 11-1034

UNITED STATES OF AMERICA,

Plaintiff, Appellee,

v.

GENERAL ELECTRIC COMPANY,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
[Hon. Paul J. Barbadoro, U.S. District Judge]

Before

Torruella and Thompson, Circuit Judges,
and Saris,* District Judge.

Peter A. Biagetti, with whom Colin G. Van Dyke, Jeffrey R.
Porter, Andrew Nathanson, and Mintz, Levin, Cohn, Ferris, Glovsky
and Popeo, P.C., were on brief for appellant.
Robert H. Oakley, U.S. Department of Justice, Environmental &
Natural Resources Division, with whom Robert Dreher, Acting
Assistant Attorney General, Lisa E. Jones, Catherine A. Fiske,
Laura Rowley, and Ruthann Sherman, Senior Enforcement Counsel, U.S.
Environmental Protection Agency, was on brief for appellee.

February 29, 2012

*
Of the District of Massachusetts, sitting by designation.
 TORRUELLA, Circuit Judge. Defendant-Appellant General

Electric Company ("GE") appeals from a district court judgment

holding it liable under the Comprehensive Environmental Response,

Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9607(a)(3),

for response costs incurred by the United States Environmental

Protection Agency ("EPA") in the unfinished cleanup of the

Fletcher's Paint Works and Storage Facility Superfund Site in

Milford, New Hampshire (the "Fletcher Site" or the "Site"). GE

also appeals the district court's judgment awarding the United

States certain costs incurred in connection with the Fletcher

Site's cleanup pursuant to 42 U.S.C. § 9613(g)(2). For the reasons

stated herein, we affirm the judgment of the district court on both

issues.

I. Background and Procedural History

"Pyranol" is an insulating material once used extensively

in electric equipment. Made from polychlorinated biphenyls

("PCBs"), Pyranol was prized for its dielectric properties -- i.e.,

it conducts electricity poorly or not at all -- and was widely used

in the 1950s and 1960s in the manufacture of transformers,

capacitors, and other devices. Time, however, was not kind to

Pyranol -- as PCBs became associated with serious health risks,1

1
"The chemicals are linked to skin cancer, liver cancer, brain
cancer, intestinal cancer, bladder cancer, leukemia, birth defects
in humans and animals, and other health problems." Church v. Gen.
Elec. Co., 138 F. Supp. 2d 169, 172 (D. Mass. 2001).

-2-
Pyranol and other products containing these chemicals were

stringently regulated and their use in manufacture drastically

curtailed. See, e.g., 42 U.S.C. § 9601(14); 15 U.S.C. § 2605(e).

For some thirty years, GE manufactured electric

capacitors containing Pyranol at its plants located in Hudson Falls

and Fort Edward, New York (respectively, "Hudson Falls" and "Fort

Edward"). GE met its Pyranol needs by purchasing "virgin" PCBs

that the Monsanto Company ("Monsanto") marketed under the name

"Aroclors." GE then refined the Aroclors it purchased from

Monsanto until the PCBs attained the level of purity necessary for

use in electric capacitors. The end result was Pyranol.

To be of use to GE, the processed Pyranol had to meet and

retain demanding purity specifications. Pyranol that fell short of

these standards was deemed "scrap Pyranol" and was stored away in

55-gallon drums in designated scrap areas.

Over time, GE accumulated a glut of scrap Pyranol, a

development that somehow brought GE into contact with Frederic H.

"Fred" Fletcher ("Fletcher"), local manufacturer, "chemical

scrapper," and businessman.2 Between 1953 and 1967, Fletcher owned

a number of paint manufacturing and storage businesses in Milford,

New Hampshire, which varyingly operated under the names Fletcher's

Paint Works or Milford Paint Works. Like GE, Fletcher also

2
The record is unclear as to the circumstances surrounding the
genesis of GE's association with Fletcher.

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routinely purchased Aroclors from Monsanto but used the unrefined

PCBs as a "plasticizer" additive for his paints. Seemingly

recognizing a mutually-advantageous situation, Fletcher and GE

gravitated toward each other and entered into an informal agreement

whereby Fletcher purchased scrap Pyranol from GE at bargain prices

for his industrial needs.

For approximately ten years ending in 1967, Fletcher

regularly purchased 55-gallon drums of scrap Pyranol from GE. GE

records indicate that in this period, Fletcher availed himself of

over 200,000 gallons of GE's scrap Pyranol. Accordingly, for the

better part of a decade, 55-gallon drums full of scrap Pyranol --

about 3,600 worth of them -- routinely traveled by truck from

Hudson Falls and Fort Edward to the Fletcher Site. Initially,

Fletcher sent one of his employees to either of the GE plants to

retrieve scrap Pyranol in 18-barrel increments. However, as

transfers increased, Fletcher and GE contracted with third-party

cargo services to haul scrap Pyranol barrels between locations in

larger trucks.

Of the more than 200,000 gallons of scrap Pyranol that

made the journey from GE's plants to the Fletcher Site in this ten-

year time frame, almost half did so between early 1966 and November

1967, when Fletcher received the final shipment. The catalyst for

this climactic increase in Pyranol transfers is unclear, but the

coinciding denouement of the GE-Fletcher relationship is well-

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documented. GE records show that, beginning in February 1966,

Fletcher regularly missed payments on almost-monthly shipments of

scrap Pyranol. By August 1967, when GE notified him by means of a

collection letter, Fletcher's account was delinquent in over six

thousand dollars for failure to pay for fourteen shipments of scrap

Pyranol. GE delivered three more shipments of scrap Pyranol after

sending this collection letter, the last of which Fletcher received

on November 10, 1967.

In early 1968, GE account officers communicated with

Fletcher in an attempt to collect on his outstanding debt to GE.

Fletcher riposted with a letter informing GE that the quality of

the scrap Pyranol he received had markedly declined in recent

years. Fletcher's letter stated that many of the scrap Pyranol

drums at the Site were unusable, proposed an arrangement whereby GE

would retrieve those drums he could not use while he paid for those

he could, and refused to receive any additional scrap Pyranol

unless GE could ensure it would provide materials of higher

quality. GE did not follow up on Fletcher's proposal. For all

intents and purposes, Fletcher's letter marked the end of his

relationship with GE.

In 1987, EPA found hundreds of drums containing scrap

Pyranol and other chemicals at the Fletcher Site. The drums were

unmarked and several had leaked. Subsequent testing detected

hazardous substances at the Site, including tricholoroethylene

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("TCE"), trichlorobenzene ("TCB"), and PCBs. As a result, EPA

placed a temporary cap on the Site and, in 1989, added it to its

National Priorities, or "Superfund," List.3

In 1991, the United States initiated an action against GE

to recoup costs associated with the Fletcher Site's cleanup (the

"1991 Action").4 See 42 U.S.C. § 9607(a)(3). The United States

requested relief for past costs incurred and declaratory judgment

establishing that GE would be liable "for all response costs to be

incurred" in connection with the Site. Compl. at 10, United States

v. Gen. Elec. Co., No. 91-467-D (D.N.H. Oct. 7, 1991). In February

1994, the parties resolved this controversy by means of a consent

decree stipulating that GE would remunerate EPA for costs incurred

through April 30, 1993. GE did not concede liability and reserved

all defenses and possible counterclaims. The United States'

declaratory judgment claim was dismissed without prejudice.

Correspondingly, the United States reserved its right to seek

additional compensation for future cleanup costs.

In 2006, the government commenced this suit against GE in

the District Court for the District of New Hampshire. Claiming

3
The EPA places sites on the National Priorities List pursuant to
its authority under CERCLA. See 42 U.S.C. §§ 9601 et seq. These
"'Superfund' sites . . . require priority remedial attention
because of the presence, or suspected presence, of a dangerous
accumulation of hazardous wastes." United States v. Cannons Eng'g
Corp., 899 F.2d 79, 83 (1st Cir. 1990).
4
The complaint in the 1991 Action also named the Windsor-Embassy
Corporation, a Fletcher-owned entity, as co-defendant.

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that GE had "arranged for disposal" of hazardous substances at the

Fletcher Site in violation of 42 U.S.C. § 9607(a)(3), the United

States sought recovery of cleanup costs incurred since 1993 and

revived its request for declaratory judgment against GE for future

related expenses. After a four-day bench trial held in November

2008, the district court announced its decision that GE had

arranged to dispose of hazardous substances at the Fletcher Site

and was liable for response costs incurred by EPA.

The district court's bench ruling against GE did not end

the proceedings below. On May 4, 2009, before the district court

had entered final judgment in this case, the Supreme Court issued

its decision in Burlington Northern & Santa Fe Railway Co. v.

United States, 129 S. Ct. 1870 (2009). Arguing that Burlington

Northern foreclosed the principal theory of liability upon which

the district court relied in issuing its oral order, GE then filed

a motion for judgment requesting that the court below withdraw its

findings. The district court denied this motion on October 28,

2009.

The litigants and the district court then focused on the

issue of identifying the response costs for which GE could be held

liable. The parties stipulated costs related to the Fletcher

Site's cleanup -- $13,103,095 (including interest) through

October 20, 2009 -- but GE argued that the United States' claim

over $1,305,921 of these was barred by CERCLA's statute of

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limitations. See 42 U.S.C. § 9613(g)(2). In cross-motions for

summary judgment, the parties disputed whether the current

litigation constituted a "subsequent action" as defined in §

9613(g)(2), in which case all of the United States' claims for cost

recovery would be timely.

On December 3, 2010, the district court granted the

United States' cross motion for summary judgment. United States v.

Gen. Elec. Co., No. 06-cv-354-PB, 2010 WL 4977478 (D.N.H. Dec. 3,

2010). Final judgment issued on December 6, 2010, and an amended

judgment was entered on December 14, 2010. This appeal followed.

II. Discussion

GE appeals the district court's judgment on two grounds.

First, GE contends that the district court mistakenly concluded

that GE arranged for the disposal of scrap Pyranol in violation of

42 U.S.C. § 9607(a)(3). Second, GE argues that even if it can be

held liable for costs incurred in the Fletcher Site's cleanup, the

district court erred by allowing the United States to recover costs

associated with two claims that GE reasons are foreclosed by

CERCLA's statute of limitations. We address each of GE's claims in

turn.

A. Arranger Liability

1. CERCLA, Arranger Liability, and Burlington Northern

In passing CERCLA, Congress "'intended that those

responsible for problems caused by the disposal of chemical poisons

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bear the costs and responsibility for remedying the harmful

conditions they created.'" Dedham Water Co. v. Cumberland Farms

Dairy, Inc., 805 F.2d 1074, 1081 (1st Cir. 1986) (quoting United

States v. Reilly Tar & Chem. Corp., 546 F. Supp. 1100, 1112

(D. Minn. 1982)). CERCLA authorizes the EPA to undertake cleanup

activities at designated hazardous sites and then sue to recover

costs incurred from certain liable parties. See 42 U.S.C.

§§ 9604(a), 9607(a); see also Am. Cyanamid Co. v. Capuano, 381 F.3d

6, 9 (1st Cir. 2004). Specifically, CERCLA "imposes strict

liability for the costs of cleanup on a party found to be an owner

or operator, past operator, transporter, or arranger." United

States v. Davis, 261 F.3d 1, 29 (1st Cir. 2001). It is this last

classification, holding liable persons who "arranged for disposal

or treatment . . . of hazardous substances," 42 U.S.C.

§ 9607(a)(3), that is relevant to this case.

Within the CERCLA scheme, arranger liability was intended

to deter and, if necessary, to sanction parties seeking to evade

liability by "contracting away" responsibility. See Team Enters.,

LLC v. W. Inv. Real Estate Trust, 647 F.3d 901, 907 (9th Cir. 2011)

("Arranger liability ensures that owners of hazardous substances

may not free themselves from liability by selling or otherwise

transferring a hazardous substance to another party for the purpose

of disposal."). Thus, for example, liability would clearly "attach

. . . if an entity were to enter into a transaction for the sole

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purpose of discarding a used and no longer useful hazardous

substance." Burlington N., 129 S. Ct. at 1878. At the other end

of the liability spectrum, an entity that sells a useful product

which is later disposed of in an improper manner without the

seller's knowledge would not be liable as an arranger under

CERCLA.5 Id. However, because the statute does not define what it

means to "arrange for disposal" of a hazardous substance under

§ 9607(a)(3), there remains a middle ground between these two

extremes -- to which we can comfortably say this case belongs -- in

which a seller entity will have "some knowledge of [a] buyers'

planned disposal or whose motives for the 'sale' . . . are less

than clear." Id. at 1879 (emphasis added). In this middle ground,

litigation over the intent required to "arrange for disposal" of a

hazardous substance has been common, and courts have diverged in

their interpretations of the CERCLA statute. Compare United States

v. Cello-Foil Prods., Inc., 100 F.3d 1227, 1231 (6th Cir. 1996)

(concluding "that the requisite inquiry is whether the party

intended to enter into a transaction that included an 'arrangement

for' the disposal of hazardous substances"), with United States v.

Aceto Agr. Chems. Corp., 872 F.2d 1373, 1380-81 (8th Cir. 1989)

5
The term "disposal" is defined to mean "the discharge, deposit
injection, dumping, spilling, leaking, or placing of any solid
waste or hazardous waste into or on any land or water so that such
solid waste or hazardous waste or any constituent thereof may enter
the environment or be emitted into the air or discharged into any
waters, including ground waters." 42 U.S.C. § 6903(3).

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(endorsing "liberal judicial interpretation" of "or otherwise

arranged for" statutory language and noting liability could be

imposed in the absence of knowledge or intent).

In Burlington Northern, the Supreme Court offered some

clarity as to when liability should attach in this more ambiguous

type of case. Ascribing the phrase "arrange for disposal" its

ordinary meaning, the Supreme Court reasoned that "an entity may

qualify as an arranger under § 9607(a)(3) when it takes intentional

steps to dispose of a hazardous substance." 129 S. Ct. at 1879

(emphasis added). Therefore, following Burlington Northern, a

discernible element of intent to dispose of a hazardous substance

is necessary for an entity to be sanctioned pursuant to

§ 9607(a)(3). See id. ("In common parlance, the word 'arrange'

implies action directed to a specific purpose.").

In the Burlington Northern litigation, the Court's plain

reading of the statute precluded holding Shell Oil Company

("Shell") liable as an arranger for routine leaks that occurred

over several decades when common carriers with whom Shell

contracted shipped hazardous chemicals (pesticides) to its

customers. Id. at 1875. Shell knew of these routine leaks but

took active measures to reduce them by circulating handling

instructions and other materials to its distributors and customers.

Id. at 1880. The Supreme Court held that Shell's knowledge of the

routine spillage, in the absence of intent to dispose of those

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hazardous substances, did not trigger arranger liability. Id.

While an entity's knowledge that a product it sells will be

discarded may be a probative factor of its intent to "dispose of"

that product, the Court explained that mere knowledge of future

disposal will not trigger arranger liability. See id.

("[K]nowledge alone is insufficient to prove that an entity

'planned for' [] disposal, particularly when the disposal occurs as

a peripheral result of the legitimate sale of an unused, useful

product.").

2. GE's Claims as to Arranger Liability Standard

GE argues that the district court applied the wrong legal

standard when it concluded that GE "arranged for disposal" of

hazardous substances under 42 U.S.C. § 9607(a)(3). This contention

implicates the proper interpretation of the CERCLA statutory text.

Accordingly, we review GE's claim de novo. Am. Cyanamid, 381 F.3d

at 12.

GE's appeal largely hinges on its reading of the Supreme

Court's Burlington Northern decision. As GE appears to understand

matters,6 Burlington Northern clarified that § 9607(a)(3) liability

6
GE's briefing on this issue expends much effort outlining (and
challenging) the district court's interpretation of the CERCLA
statute. We note that "[s]ince our review is de novo, we need not
consider whether the specific reasoning set out by the district
court contained errors." Euromotion, Inc. v. BMW of N. Am., Inc.,
136 F.3d 866, 872 (1st Cir. 1998) (citations omitted). To properly
frame our discussion, however, we distill GE's arguments as they
pertain to our fresh-eyed interpretation of the statutory text.
Because the district court determined the issue of liability

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may only attach in cases where a person or entity has the

distinctly apparent objective of disposing of its hazardous

substances. Further refined, GE's contention is that only an

entity that enters into an arrangement with a transparently evident

desire to have its hazardous substances enter the environment

properly comes into § 9607(a)(3)'s purview.

We do not agree that Burlington Northern so narrowed the

scope of § 9607(a)(3). As explained above, the Supreme Court's

Burlington Northern decision settled the fact that arranger

liability does not accrue in the absence of intent to dispose of a

hazardous substance. In interpreting § 9607(a)(3), the Burlington

Northern Court did not, however, suggest that arranger liability

applies solely to circumstances in which the stated or facially-

evident purpose of an arrangement is to dispose of hazardous

substances. While these "easy" cases may lie at one end of a

spectrum, there necessarily remains a range of cases in which

arranger liability is proper but the parties' intent will not be

obvious. See Burlington N., 129 S. Ct. at 1879 ("Less clear is the

liability attaching to the many permutations of 'arrangements' . .

. in which the seller has some knowledge of the buyers' planned

against GE prior to the Supreme Court's judgment in Burlington
Northern, we further note that we now operate against a changed
legal landscape and look to the high court's decision for guidance.
See Sheehan v. City of Gloucester, 321 F.3d 21, 24 (1st Cir. 2003)
("[I]t is axiomatic that 'a court is to apply the law in effect at
the time it renders its decision . . . .'" (quoting Bradley v.
Richmond Sch. Bd., 416 U.S. 696, 711-12 (1974))).

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disposal or whose motives for the 'sale' of a hazardous substance

are less than clear."). In these cases, divining the element of

intent necessary to implicate arranger liability remains a "fact-

intensive inquiry" which, guided by Congress's intent in enacting

CERCLA's strict-liability regime, "looks beyond the parties'

characterization of the transaction as a 'disposal' or a 'sale'

. . . . " Id. It is to this factual analysis which we now turn.

3. Whether GE May be Held Liable as an Arranger Under
42 U.S.C. § 9607(a)(3)

a. GE Considered Scrap Pyranol to be a Waste
Product

Undertaking the factual inquiry that Burlington Northern

requires -- and mindful that "[t]here is no bright line between a

sale and a disposal under CERCLA," Burlington N., 129 S. Ct. at

1879 (quoting Pneumo Abex Corp. v. High Point, Thomasville Denton

R.R. Co., 142 F.3d 769, 775 (4th Cir. 1998)) (internal quotation

marks omitted) -- we reject GE's contention that it may not be

properly subject to liability under § 9607(a)(3). In holding that

§ 9607(a)(3) liability could not be imposed on Shell, the Supreme

Court in Burlington Northern endorsed the "useful product

doctrine." See Burlington N., 129 S. Ct. at 1878, 1880. As stated

in a Second Circuit case upon which the Supreme Court relied, see

id. at 1878, this doctrine provides that CERCLA arranger liability

does not attach "[i]f a party merely sells a product, without

additional evidence that the transaction includes an 'arrangement'

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for the ultimate disposal of a hazardous substance . . . ."

Freeman v. Glaxo Wellcome, Inc., 189 F.3d 160, 164 (2d Cir. 1999)

(alterations in original) (quoting Fla. Power & Light Co. v. Allis

Chalmers Corp., 893 F.2d 1313, 1317 (11th Cir. 1990)); see also

Team Enters., 647 F.3d at 908 (in post-Burlington Northern case,

noting "[t]he useful product doctrine serves as a convenient proxy

for the intent element because of the general presumption that

persons selling useful products do so for legitimate business

purposes").

In contrast to Burlington Northern, where Shell's

exposure to liability stemmed from its sale of a legitimate new and

useful product, the record here contains ample evidence that GE

viewed scrap Pyranol as waste material and that any profit it

derived from selling scrap Pyranol to Fletcher was subordinate and

incidental to the immediate benefit of being rid of an overstock of

unusable chemicals. See Team Enters., 647 F.3d at 908 ("[A] person

may be subject to arranger liability 'only if the material in

question constitutes 'waste' rather than a useful product.'"

(quoting Cal. Dep't of Toxic Substances Control v. Alco Pac. Inc.,

508 F.3d 930, 934 (9th Cir. 2007))). GE stored scrap Pyranol, a

byproduct of its capacitor manufacturing operations,7 in second-

7
The parties' stipulated facts state that during the relevant
time period, "[GE's] capacitor manufacturing process yielded 'scrap
Pyranol' from various points at the GE Plants, including the treat
room, sealing station and degreaser, and from a variety of sources,
including spills, leaks, overflows, clean-up, contamination of

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hand 55-gallon drums -- often labeled "scrap Pyranol," "waste

Pyranol," "scrap oil," or otherwise, depending on the manner in

which it was collected -- which were then placed in its facilities'

salvage areas. The parties' stipulated facts and other materials

in the record show that GE pursued varied arrangements by which to

deplete its scrap Pyranol stockpile, for example, by transferring

scrap Pyranol to local landfills, selling it to local government

entities which could use it as dust suppressant, giving it away to

its employees for use as a weed killer, or discharging it into the

Hudson River.8 Moreover, the unstable nature of the materials GE

virgin Pyranol, off-specification virgin Aroclors, fluid drained
from booster pumps, and fluid drained from scrapped or reject
capacitors -- which was placed in drums and labeled accordingly."
8
An internal communication from GE Manager Robert T. Abbe also
suggests that during the last two years of the GE-Fletcher
relationship -- a period during which, as we explain further infra,
shipments of scrap Pyranol to the Fletcher Site increased markedly
-- GE had storage space-related difficulties stockpiling scrap
Pyranol in its facilities. In this communication, dated March 13,
1968, Abbe explained to GE Quality Control Manager C.R. Zecchini
that "we" -- a plural articulation presumably meant to account for
the GE Hudson Falls facility -- "are quietly burying ourselves in
drums of scrap Pyranol." Consistent with GE's other documented
efforts to landfill excess scrap Pyranol it could not dispose of in
any other manner, the letter then requested "advice and counsel
regarding the dangers of disposing of this material into a land
filled dump," adding: "Since P-II has potential health hazards, we
should understand the dangers, but at the same time realistically
appraise the possibilities of a problem with proper dumping
procedures."
In his deposition, Abbe explained that the designation "P-II"
referred to "Pyranol II," the second of two classifications of
scrap Pyranol that GE handled at the time. According to Abbe, as
of early 1968, GE considered Pyranol II to be "a more difficult
material" with "more potential health hazards" than other Pyranol,
which was instead designated "Pyranol I."

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provided Fletcher, as well as the fact that a significant amount of

GE's scrap Pyranol was contaminated with other substances or

extraneous objects, betrays the fact that GE subjected these

chemicals to minimal or non-existent quality control.9 This

evidence is inconsistent with the notion that GE ever viewed scrap

Pyranol as the archetypal "useful substance [conveyed] for a useful

purpose" that has commonly been found to lie outside of

§ 9607(a)(3)'s reach. Cello-Foil Prods., 100 F.3d at 1232

(quotation mark omitted).

Also telling in this regard is what the record does not

reveal: any attempt by GE to market scrap Pyranol as a viable

product to any entity or person other than Fletcher. Indeed, the

record is devoid of evidence suggestive of a general demand for

scrap Pyranol other than Fletcher's idiosyncratic interest in

procuring the materials with the hope to, as one of his former

employees who served as a witness explained, "make a dime and a

profit." Although it is clear that Fletcher used an unknown amount

of scrap Pyranol as a plasticizer agent in his paint making

operations, evidence proffered by the government's expert suggested

that the uncertain and inconsistent quality of scrap Pyranol

9
The scrap Pyranol in the drums that GE at times gave and at
others sold to Fletcher contained contaminants and other impurities
such as Fuller's Earth, drying compounds, pump oil, drinking soda,
and degreaser. Other scrap Pyranol drums in GE's salvage areas
included garbage and objects like discarded gloves and
transportation tags.

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rendered it a poor choice even for that purpose. Because each drum

of scrap Pyranol could vary in composition, its use as an additive

could yield a paint product of unpredictable quality -- a risky

undertaking that could render entire batches of paint defective.

Relying on this evidence, the district court reasoned that if use

as a plasticizer ingredient was indeed a practical or sustainable

application for scrap Pyranol, then GE, a sophisticated profit-

seeking entity, would have either used it as an additive in its own

paint making operations or sought to expand the market for its

scrap Pyranol to purchasers other than Fletcher.10 We agree with

the district court that the lack of a viable market for scrap

Pyranol during the relevant period supplies further proof that GE

did not view scrap Pyranol as a legitimate and serviceable product.

See Team Enters., 647 F.3d at 908 (noting CERCLA plaintiff "can

overcome the [useful product doctrine] defense by showing that the

substance involved in the transaction 'has the characteristic of

10
Evidence in the record indicates that Fletcher sold an uncertain
amount of the scrap Pyranol it obtained from GE to a local company
called W.F. Webster Cement (also known as "Webtex"), which, in
turn, added the chemicals to roofing products such as roof coatings
and cements. The record does not suggest, however, that the
amounts of scrap Pyranol that Webtex purchased from Fletcher were
substantial, nor does it suggest, as GE implies, that these sales
indicate there were alternative markets for the chemicals. In any
case, the parties have stipulated that GE was never aware of
Fletcher's scrap Pyranol transfers to Webtex, a fact that renders
the transfers irrelevant to GE's intent in its dealings with
Fletcher.

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waste at the time it is delivered to another party'" (quoting Alco

Pac., 508 F.3d at 934)).

b. GE's Actions and Targeted Inactions Satisfy
CERCLA's Intent Requirement Under 42 U.S.C.
§ 9607(a)

The fact that GE viewed the scrap Pyranol in its scrap

and salvage yards as a waste product does not, by itself, bring GE

within the purview of § 9607(a)(3) arranger liability. Our focus

now turns to GE's dealings with Fletcher to determine whether GE

possessed the element of intent necessary to qualify as an arranger

under § 9607(a)(3). See Burlington N., 129 S. Ct. at 1880 (quoting

Cello-Foil Prods., 100 F.3d at 1231, to acknowledge "indispensable

role that state of mind must play in determining whether a party

has 'otherwise arranged for disposal . . . [of] hazardous

substances'"). Doing so, we must conclude that GE's documented

actions and, importantly, calculated inactions in relation to the

Fletcher Site, evince sufficient intent to dispose of a hazardous

substance to place it squarely within the scope of liability

envisioned by CERCLA.

It is necessary to outline what GE understood or knew

about Fletcher's intentions regarding the large amounts of scrap

Pyranol that GE transferred or sold to Fletcher during the relevant

time period. At trial, Albert Clark, a former GE sales

representative who dealt with Fletcher, testified that GE

understood that Fletcher ran a small paint company based in New

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Hampshire. As noted above, the record sustains an inference that

GE knew or otherwise understood that Fletcher used an unknown

amount of the scrap Pyranol he purchased as a plasticizer in his

paint manufacturing operations. At a minimum, GE also likely

understood that Fletcher saw some value in the scrap Pyranol

because Fletcher paid (or said he would pay) for these materials,

at times complained about the quality of the scrap Pyranol, at

others tested and rejected scrap Pyranol that was too "thinned out"

and, for a time, sent his employees and trucks to GE facilities to

retrieve the drums. Because Fletcher alleged certain drums were

unusable to him one can also infer that, from early on, GE

understood some drums of scrap Pyranol contained materials of such

poor quality so as to not be of any value whatsoever to Fletcher.

However, the record also indicates that the GE-Fletcher

relationship was a dynamic one, spanning over a decade, and that

the nature of the arrangement between the parties fluctuated from

beginning to end. Though GE was content at first giving Fletcher

between 100 and 500 drums of scrap Pyranol at no charge, starting

in 1956 GE required payment of $3.50 to $4.00 per 55-gallon drum.

Other changes involved the procedures by which Fletcher could

replace drums he considered deficient. Before 1964, Fletcher was

able to replace drums containing scrap Pyranol he claimed to be

unusable free of charge; not so between 1964-66, a period during

which GE required Fletcher to pay for each drum that Fletcher

-20-
transported from GE facilities to the Site.11 Not surprisingly,

during this period, Fletcher's employees tested drums of scrap

Pyranol for quality assurance at GE facilities before loading them

onto Fletcher's truck, rejecting those Fletcher could not use.

The arrangement between Fletcher and GE again shifted at

some point during 1966, and GE's conduct over the following two

years leaves little doubt that GE availed itself of its

relationship with Fletcher to rid itself of the scrap Pyranol in

its inventory. During this period, GE, not Fletcher, loaded the

trucks that traveled from GE facilities to the Fletcher Site, and

the frequency with which GE sent Fletcher shipments of scrap

Pyranol drastically increased.12 There is no indication in the

record that Fletcher solicited or wanted the increase.

Importantly, from February 1966 onwards, Fletcher routinely missed

payments and did not compensate GE for any shipments of scrap

11
These changes in GE's approach to its relationship with Fletcher
appear to track turnover in the GE personnel tasked with handling
the Fletcher account. Until 1964, Fletcher dealt primarily with
Anthony Metevier, who supervised the scrap and salvage department
at Hudson Falls. Between 1964-66, however, a GE employee named
Edward Varnum assumed Metevier's previous responsibilities. The
subsequent shift in the arrangement, discussed infra, corresponded
with Edward Varnum's departure from GE.
12
The amount of scrap Pyranol GE sent to Fletcher between 1966 and
November 1967 exceeded the volume of all scrap Pyranol Fletcher had
obtained since receiving the initial free shipment from GE. In
toto, GE sent 102,575 gallons of scrap Pyranol to the Fletcher Site
during this period.

-21-
Pyranol.13 However, Fletcher's failure to pay for its shipments

notwithstanding, GE's scrap Pyranol deliveries continued apace,

with Fletcher receiving three more shipments between August and

November 10, 1967.

Evidence in the record suggests that during this final

stage of the GE-Fletcher relationship, GE largely controlled the

flow of scrap Pyranol between GE facilities and the Fletcher Site.

A letter from Fletcher to GE account representative Albert C. Clark

contemporaneous with this period and dated February 16, 1968 (the

"Fletcher Letter"), indicates that once Fletcher ceased using its

trucks to make scrap Pyranol pickups, Fletcher employed a contract

trucker to "haul a few loads." When this trucker went out of

business, GE then arranged with other third parties to transport

the chemicals at Fletcher's expense.

The Fletcher Letter is notable and important to our

discussion for other reasons. In his letter, Fletcher informed GE

that the quality of the scrap Pyranol sent to him had markedly

declined in the preceding "two or three years." At that point,

Fletcher explained:

All of a sudden we could not dispose of this
Pyronal [sic] as you had apparently added
something and we could find nothing to
neutralize the additive you were using.

13
GE memorialized the delinquent status of the Fletcher account
in a letter found in the record, dated August 31, 1967, which
included a listing of "old past due debit memoes [sic]" for
fourteen shipments of scrap Pyranol.

-22-
 Secondly you put the Pyronal [sic] in badly
contaminated drums . . . . [Y]ou have shipped
drums one quarter and one half full and drums
of more than half water.

In other words, what we were buying as a
reasonable scrap product, turned into a large
percentage of what is known as garbage in the
Chemical trade.

Fletcher added:

Unknown to me, this has been going on for some
time and our paint foreman has been piling the
drums. At the present time we have
approximately 1800 to 2000 drums on
hand. . . .

. . . .

When our truck was picking up your men were
careful to give us the right material. Our
driver would not have accepted the bad drums.
Since your man has been hauling to us you
have, apparently, been loading everything on
God's green earth on the truck.

In closing, Fletcher proposed that GE's chemists examine the

approximately 2,000 drums on the Fletcher Site to determine which

of them met the standards of the chemicals received "over the

twelve years prior to the last three years," and agreed to pay for

those that did. All others, Fletcher said, he expected to be able

to return via GE-provided freight. Finally, Fletcher refused to

receive any additional scrap Pyranol unless GE could ensure it

would provide materials of higher quality.

Taken at face value, the Fletcher Letter goes a long way

to upend GE's claim, first made at the district court and now

renewed on appeal, that throughout its dealings with Fletcher it

-23-
understood that he purchased or accepted thousands of gallons of

scrap Pyranol with a view to use these for a useful or legitimate

purpose. At a minimum, the Fletcher Letter put GE on notice that

(1) large quantities of the hazardous substances that it had

provided were of absolutely no use to Fletcher and were, at that

moment, "piled" at the Fletcher Site, (2) Fletcher had not

consciously accepted large quantities of the chemicals GE had

delivered at the Fletcher Site -- i.e., "[u]nknown to me, this has

been going on for some time" -- and (3) importantly, that Fletcher

expected GE's cooperation in resolving the matter of the more than

1,800 55-gallon drums of unusable chemicals sitting at the Site.

This third factor points us to what we believe is a

crucial distinction between Burlington Northern and the instant

case: in Burlington Northern, the Supreme Court underscored the

fact that Shell took varied active steps to reduce chemical

spillage as evidence supportive of an inference that Shell did not

intend the spills to occur in the first place. See 129 S. Ct. at

1880. In contrast -- once apprised that Fletcher had no use for

large quantities of the scrap chemicals GE had sent to his

facilities, aware that Fletcher blamed GE for (either deliberately

or negligently) sending contaminated shipments of scrap Pyranol to

his attention, and conscious of the fact that Fletcher desired to

transfer these chemicals back to GE -- GE took at least three

-24-
well-documented steps the collective effect of which, rather than

prevent or reduce the likelihood of disposal, was to ensure it.

First, GE undertook to corroborate Fletcher's claims

regarding the poor quality of the scrap Pyranol that he had

received from GE. At some point in the summer of 1968, GE asked

one of Monsanto's chemists to conduct tests on a sample of the

drums of scrap Pyranol that GE had, until recently, routinely sent

Fletcher.14 The results of these tests were memorialized in an

internal GE letter dated August 6, 1968 (the "GE Letter"), in which

Senior Buyer Albert C. Clark informed GE Manager of General

Accounting D.W. Humphrey of his and other unidentified personnel's

collective assessment, "find[ing] that [Fletcher] has a valid

claim." Endorsed by Robert Abbe, Manager at Hudson Falls at the

time, the GE Letter went on to explain that the scrap Pyranol

Fletcher had received was inconsistent and/or contaminated in

nature, noting "[t]he material in question contained anything from

water to [TCE] (as much as 22% [TCE] was found)." In addition, the

GE Letter confirmed in clear terms that the scrap Pyranol that GE

sent Fletcher during the period at issue did not meet the standards

GE's account handlers understood Fletcher to require, stating:

"This certainly is not the material that [Fletcher] agreed to buy

at $3.75 per drum."

14
At trial, GE account representative Albert C. Clark testified
that GE requested Monsanto's services so as to "attempt to validate
or disprove the statements in [the Fletcher Letter]."

-25-
 Second, once its own testing had confirmed Fletcher's

claim that much of the scrap Pyranol it sent Fletcher in recent

years was contaminated and/or unusable, GE decided to forgive

Fletcher's debt. After endorsing Fletcher's view that much of what

had been delivered to him was unstable or contaminated material,

the GE Letter explicitly recommended that Fletcher's "outstanding

Accounts Receivable in the amount of $6,993.75 be written off." As

outlined in the GE Letter, this recommendation reflected a

deliberate financial calculus that accounted for the fact that GE

viewed scrap Pyranol as a waste product that should have been

discarded and the company stood to benefit financially by leaving

Fletcher to deal with the issue of disposal.15

Third, consistent with this recommendation and cost

analysis, GE made no effort, either then or at a later date, to

retrieve, cleanup, or otherwise properly dispose of the thousands

15
Specifically, in reference to the scrap Pyranol at the Fletcher
Site the GE Letter stated:

The material in question should have been disposed of (if
we could have found an acceptable method of disposal).
The cost would have been at least $.50 per drum plus the
loss of the drum valued at $1.25 or a total cost to G.E.
of 1856 @ $1.75 = $3,248.00.

It is our recommendation that the outstanding Accounts
Receivable in the amount of $6,993.75 be written off.
Since [Fletcher] paid the transportation, the only cost
to G.E. is the drums at $1.25 ea. or $2,320.00. Giving
us a savings of $928.00.

(Emphasis added.)

-26-
of drums of scrap Pyranol Fletcher had claimed were unusable to

him. Evidence in the record supports the district court's

conclusion that GE's non-action in this regard flowed from a

deliberate decision to wash its hands of the issue of the scrap

Pyranol's disposal in the belief that GE could benefit by shifting

that responsibility to Fletcher. Most notably, asked what he

understood would happen to the drums of scrap Pyranol once GE

decided to write off Fletcher's debt, Robert Abbe, former Manager

at Hudson Falls declared: "I don't think that was of any -- any

concern. We just hoped he was able to use some of it, and the

balance of it he could dispose of it." (Emphasis added.)

Standing before this case's voluminous record, we simply

cannot reconcile GE's well-documented history of purposeful

inaction in relation to the scrap Pyranol left at the Fletcher Site

with its vehement claims that it did not harbor the intent

necessary to come under § 9607(a)(3)'s scope. GE argues that the

district court committed reversible error when it ruled that GE was

an arranger because it acted with the understanding that some

disposal of scrap Pyranol was "substantially certain" to occur --

a standard that the district court described as "constructive

intent" -- and emphasizes that the district court did not find that

GE had an actual intent to dispose of scrap Pyranol. But the

district court's oral findings should not be read in a vacuum. In

written findings issued after the Supreme Court issued its decision

-27-
in Burlington Northern, the district court cleaned up any ambiguity

by finding that GE intentionally used Fletcher to rid itself of and

dispose of the scrap Pyranol. This finding of intent is firmly

rooted in the record. To summarize, the record paints a picture in

which this much is clear: (1) GE considered scrap Pyranol waste

material; (2) because Fletcher, a "chemical scrapper," saw some

value in GE's scrap Pyranol, GE, in turn, saw in Fletcher an

auspicious and efficient manner in which to rid itself of thousands

of gallons of scrap Pyranol; (3) GE understood that not all of its

scrap Pyranol would be of use to Fletcher; (4) during the last

years of the GE-Fletcher relationship, GE largely controlled the

amount and quality of the scrap Pyranol shipped from its facilities

to the Fletcher Site; (5) during this same period, scrap Pyranol

transfers from GE to the Fletcher Site increased drastically and

continued even once Fletcher became delinquent in paying his

account; (6) Fletcher eventually complained that GE had sent him

considerable amounts of contaminated or otherwise unusable scrap

Pyranol -- a claim that GE eventually confirmed through its own

testing -- and asked that GE retrieve those drums that were of no

use to him; (7) crunching numbers, GE then concluded that writing

off Fletcher's debt and unburdening itself of the responsibility to

dispose of the scrap Pyranol represented a more financially

advantageous option than complying with Fletcher's request; and (8)

in accordance with this conclusion, GE took no further action,

-28-
leaving Fletcher to dispose of the scrap Pyranol as he best saw

fit.

Properly connected, these points establish that GE

purposefully entered into its arrangement with Fletcher with the

desire to be rid of the scrap Pyranol. Though the initial

arrangement (informal as it was) may not have, in express terms,

directed Fletcher to dispose of GE's scrap Pyranol, GE certainly

understood this would be the result of its actions and took the

conscious and intentional step of leaving Fletcher to dispose of

the materials. We are mindful of the Supreme Court's instruction

that in carrying out our duty to review the record before us, we

must "look[] beyond the parties' characterization of the

transaction as a 'disposal' or a 'sale' and seek[] to discern

whether the arrangement was one Congress intended to fall within

the scope of CERCLA's strict liability provisions." Burlington N.,

129 S. Ct. at 1879. Here, GE has made every effort to convince us

that its arrangement with Fletcher constituted a proper arms-length

"sale," but its attempts to do so are not borne out by the record.16

16
GE has brought the Ninth Circuit's recent decision in Team
Enterprises, LLC v. Western Investment Real Estate Trust, 647 F.3d
901 (9th Cir. 2011) to our attention. The plaintiff in Team
Enterprises, a dry cleaning store operator, sued manufacturer
defendant R.R. Street & Co., Inc. ("Street") for contribution of
cleanup costs under CERCLA, claiming that Street's dry cleaning
machine equipment made disposal of wastewater containing hazardous
substances inevitable. 647 F.3d at 909. The Ninth Circuit
rejected the plaintiff's claim that Street's design indicated that
the manufacturer "intended the disposal" of hazardous substances.
Id. "At most," the Team Enterprises court explained, "the design

-29-
We therefore hold that GE's actions in relation to the Fletcher

Site render it liable for arranging for disposal of a hazardous

substance pursuant to § 9607(a)(3).

B. Cost Recovery Claims and CERCLA Statute of Limitations

Having concluded that GE can properly be subjected to

liability under 42 U.S.C. § 9607(a)(3), we must now consider GE's

remaining claim on appeal. At issue is whether the United States

can recover $1,305,921 in costs incurred in connection with removal

actions that EPA conducted at the Fletcher Site in 1993 and 1995

(collectively, the "1993 and 1995 Removal Actions").17 As it did

unsuccessfully at the district court, GE now argues that recovery

indicates that Street was indifferent to the possibility" of
disposal. Id.

GE relies upon Team Enterprises to press the point that
indifference is insufficient to establish arranger liability, but
this case is not persuasive because, unlike the instant case, Team
Enterprises involved a "useful product." See id. Moreover, as we
have already explained, GE's actions and purposeful or calculated
decisions not to act at other times compel us to conclude that it
did, in fact, "take[] intentional steps to dispose of a hazardous
substance." Burlington N., 129 S. Ct. at 1879.
17
Under 42 U.S.C. § 9601(23), a removal action is defined as:

[T]he cleanup or removal of released hazardous substances
from the environment, such actions as may be necessary
[to take] in the event of the threat of release of
hazardous substances into the environment, such actions
as may be necessary to monitor, assess, and evaluate the
release or threat of release of hazardous substances, the
disposal of removed material, or the taking of such other
actions as may be necessary to prevent, minimize, or
mitigate damage to the public health or welfare or to the
environment, which may otherwise result from a release or
threat of release.

-30-
of these costs is precluded by the applicable three-year statute of

limitations for removal action cost recovery claims under CERCLA.

See 42 U.S.C. § 9613(g)(2). This secondary claim again requires us

to consider the proper interpretation of the CERCLA statute, a

question that we review de novo. United States v. JG-24, Inc., 478

F.3d 28, 32 (1st Cir. 2007). We begin our discussion of this issue

by outlining the relevant statutory framework.

In pertinent part, CERCLA provides that "[a]n initial

action for recovery of the costs referred to in section 9607 . . .

must be commenced . . . for a removal action, within 3 years after

completion of the removal action . . . ." 42 U.S.C. § 9613(g)(2)

(emphasis added). The statute then provides additional detail,

dictating:

In [an initial action], the court shall enter
a declaratory judgment on liability for
response costs or damages that will be binding
on any subsequent action or actions to recover
further response costs or damages. A
subsequent action or actions under section
9607 of this title for further response costs
. . . may be maintained at any time during the
response action, but must be commenced no
later than 3 years after the date of
completion of all response actions . . . .

Id. (emphasis added).

Distilled for our present purposes, the upshot of this

statutory language is that the United States may only recoup costs

arising from the 1993 and 1995 Removal Actions if, as it argues,

the controversy we now consider is a "subsequent action . . . to

-31-
recover further response costs or damages," id., and the 1991

Action is an "initial action." Otherwise, because work undertaken

in connection with the 1993 and 1995 Removal Actions culminated in

1994 and 1995, respectively, the three-year statute of limitations

would have extinguished these claims in 1997 and 1998.

GE's position is that the instant case presents an

"initial action" insofar as it asserts claims for costs incurred in

the 1993 and 1995 Removal Actions. GE first looks to the statutory

text. Because § 9613(g)(2) provides that in an initial action "the

[district] court shall enter a declaratory judgment on liability

for response costs or damages that will be binding on any

subsequent action or actions," 42 U.S.C. § 9613(g)(2) (emphasis

added), GE posits that for an action to be "initial" under CERCLA,

the district court must enter binding declaratory judgment on

liability. Put another way, "[u]nless and until a defendant has

been subjected to [] a prior, binding judgment on liability, any

further cost-recovery action against him will also be 'an initial

action' for purposes of the statute of limitations." Brief of GE

at 42. From this premise, GE then reasons that since the district

court did not enter a declaratory judgment regarding GE's liability

in the 1991 Action, the instant suit may not be properly considered

"subsequent to" the former as per the CERCLA scheme.

We are not persuaded by GE's position regarding the

proper interpretation of § 9613(g)(2). "CERCLA seeks to provide

-32-
EPA with the necessary tools to achieve prompt cleanups[,]" one of

which must be "the ability to foster incentives for timely

settlements." United Techs. Corp. v. Browning-Ferris Indus., Inc.,

33 F.3d 96, 103-04 (1st Cir. 1994) (citation omitted). By creating

an incentive for CERCLA plaintiffs to litigate matters to judgment

either early or often, instead of seeking resolution through

settlement or consent decree, GE's reading of § 9613(g)(2) would

all but do away with an essential instrument in the CERCLA tool

chest. See Davis, 261 F.3d at 28 (noting CERCLA "paradigm

. . . encourages the finality of early settlement"); United States

v. DiBiase, 45 F.3d 541, 545 (1st Cir. 1995) (noting "CERCLA's

policy of encouraging settlements as opposed to endless court

battles").

As it must, the statutory text guides our analysis.

Contrary to GE's assertions, nothing in the text of § 9613(g)(2)

requires that declaratory judgment be entered in a prior action for

a later-in-time suit to constitute a "subsequent" action under

CERCLA. The statute does not plainly define "initial action" as

one that culminates in a district court's entering of declaratory

judgment; nor does it define a "subsequent action" as one that

follows a prior suit in which a court entered declaratory judgment.

Instead, as the Seventh Circuit explained in United States v.

Navistar International Transportation Corp. where it rejected the

same argument that GE now presses in this appeal, "[t]he structure

-33-
of this subsection indicates that the intent of Congress . . . was

to avoid the necessity of relitigating liability questions. It

provides for the declaratory judgment as a way to manage the

litigation in an efficient manner."18 152 F.3d 702, 709 (7th Cir.

1998) (emphasis added). While a reading of § 9613(g)(2) evinces

Congress's intent to encourage resolution by means of consent

decrees among parties to Section 9607 actions, the statute cannot

be read to foreclose resolution of those suits by other means.

Neither, we believe, can it be read "to indicate that the entry of

such a declaratory judgment is a prerequisite to the prosecution of

a 'subsequent action . . . for further response costs.'" Id. at

710 (quoting 42 U.S.C. § 9613(g)(2)).

18
We take additional comfort in the fact that the Eighth Circuit,
the other appellate circuit to directly pass judgment on this
interpretation of the CERCLA statute, has similarly rejected it.
See United States v. Findett, 220 F.3d 842, 846 (8th Cir. 2000)
("[C]ongress did not intend that the 'declaratory judgment'
language be used to define an initial action for purposes of
determining whether a later action against the same party and
pertaining to the same site is subsequent for CERCLA statute of
limitation purposes, when the later action is filed after
resolution by consent decree of the earlier action.").

The two cases upon which GE relies as support to the contrary
are not apposite. See New York v. Green, 420 F.3d 99, 111 (2d Cir.
2005); Kelley v. E.I. Dupont de Nemours & Co., 17 F.3d 836, 844
(6th Cir. 1994). They both stand for the proposition that in cases
where a court does determine liability against a CERCLA defendant,
the court must also submit declaratory judgment as to the same in
order to foreclose relitigation of that issue. Unlike Navistar and
Findett, neither case touches on whether a court must issue
declaratory judgment on the issue of liability for a suit to
constitute an "initial action."

-34-
 As we have already suggested, interpreting § 9613(g)(2)

to set in place a regime whereby a "subsequent action" could only

occur if a prior action has been resolved through declaratory

judgment would run counter to Congress's objective in enacting

CERCLA to "promote the timely cleanup of hazardous waste sites."19

Burlington N., 129 S. Ct. at 1874 (internal quotation marks

omitted). CERCLA cleanups are protracted ordeals that usually

require a series of removal actions spanning several years. See

Am. Cyanamid, 381 F.3d at 16 (noting environmental cleanups are

"done in phases" in order to make them "manageable"). Under GE's

interpretation, if the United States opted to settle a cost

recovery action, it must then time and time again bring suit before

the three-year statute of limitations on each individual later

removal action tolled. We therefore agree with the government that

GE's reading of the statute would upset Congress's intent to

encourage "settlements [to] reduce excessive litigation expenses

19
This objective is also evident in § 9613(g)(2)'s legislative
history, which presents declaratory judgment as a prudent device
through which to channel CERCLA litigation. See H.R. Rep. No. 99-
253, at 21 (1985), reprinted in 1986 U.S.C.C.A.N. 3038, 3044, 1985
WL 25941 ("In the initial cost recovery action, in order to
conserve judicial time and resources, the court is to enter a
declaratory judgment on liability for response costs . . . ."
(emphasis added)); see also Navistar, 152 F.3d at 709 (noting court
"understand[s] [§ 9613(g)(2)'s] legislative history . . . to
indicate" declaratory judgment is "a way to manage [] litigation in
an efficient manner"). Thus, although § 9613(g)(2)'s text and its
place in the overarching CERCLA scheme do our heavy lifting today,
we note that the legislative history further undercuts GE's claims
on this issue.

-35-
and transaction costs, thereby preserving scarce resources for

CERCLA's real goal: the expeditious cleanup of hazardous waste

sites." DiBiase, 45 F.3d at 546.

We hold that the instant suit is a subsequent action

under CERCLA and that the 1991 Action was an initial action as per

§ 9613(g)(2). GE does not claim -- nor do we believe it reasonably

could -- that the 1991 Action was not an "action for recovery of

the costs referred to in section 9607 . . . ." 42 U.S.C.

§ 9613(g)(2). Although the United States asserted a claim for

declaratory judgment regarding GE's liability in the 1991 Action,

the parties concluded that resolving the matter via consent decree

was to their mutual benefit. The United States and GE both walked

away from the 1991 Action knowing they would likely meet again; GE

did not concede liability and the United States reserved its right

to pursue additional recovery costs at a later date.20 This

20
The district court aptly summarized the reasons why the manner
in which the 1991 Action unfolded is standard CERCLA procedure:

[W]hen removal cost recovery actions are filed early in
the cleanup process, it will often be impossible for a []
defendant to estimate its exposure in the event that it
is ultimately determined to be a responsible party.
Thus, it is extremely unlikely that it will agree to
participate in a consent decree . . . if it is also
required to agree to a declaratory judgment on liability
that can be used against it in subsequent litigation.
Conversely, the government is unlikely to settle a
removal cost recovery action without a liability
determination if it is thereby barred from claiming the
benefit of the extended limitation period that applies to
"subsequent actions."

-36-
agreement was reached according to routine CERCLA practice and was

consistent with the United States' obligation to avoid drawn-out

litigation. See 42 U.S.C. § 9622(a) ("[W]henever practicable and

in the public interest . . . the President shall act to facilitate

agreements . . . to expedite effective remedial actions and

minimize litigation." (emphasis added)). GE's claims to the

contrary are unavailing.

III. Conclusion

For the above-stated reasons, we affirm the judgment of

the district court.

Affirmed.

United States v. Gen. Elec. Co., No. 06-cv-354-PB, 2010 WL 4977478,
at *3 (D.N.H. Dec. 3, 2010); see also Findett, 220 F.3d at 846 ("It
would hinder Congress's objective of providing for the prompt
initiation of remediation of hazardous waste sites . . . if the EPA
were to be required to forfeit a future claim for response costs as
the result of a time-bar because it opted to settle a
case . . . .").

-37-