United States v. Aceto Agricultural Chemicals Corp. 872 F.2d 1373 (8th Cir. 1989)
Aidex operated a pesticide formulation facility in Iowa.
They went bankrupt, leaving behind a facility that was contaminated with
At the facility, Aidex had mixed pesticides for eight
pesticides manufacturers (including Aceto) for commercial sale. Aidex
never owned the pesticides they mixed, they just performed a service for
the pesticide manufacturers.
Iowa and EPA began cleaning up the site and sued the
pesticide manufacturers to recover costs under Comprehensive
Environmental Response, Compensation, and Recovery Act (CERCLA)
§107(a)(3) says that anyone who arranged for the
disposal of hazardous substances can be held liable if they are
improperly disposed of.
The Trial Court found Aceto and the other companies liable
for $10M. They appealed.
Aceto argued that they just wanted their pesticides mixed
and returned and had never intended for any materials to be disposed of,
therefore they did not meet the definition of §107(a)(3).
However, the Trial Court interpreted the Statute broadly.
Also, the mixing process was well known to generate
hazardous wastes, so Aceto couldn't claim they didn't know what was
The Appellate Court affirmed.
The Appellate Court looked to the definition of
'disposal' in CERCLA and found that it includes spills and leaks.
So even if Aceto didn't intend to have the pesticides dumped, they did
accept liability for spills and leaks likely to occur from Aidex's mixing
The Court found that a broad reading of CERCLA was
consistent with the goals of the Statute.
The Court looked to other similar cases, and found that
other courts had also interpreted the Statute broadly.
Other courts have come to different conclusions, and have
held that the words "arranged for" in §107(a)(3) imply
intentional action, and that companies such as Aceto should not be held
liable. Eventually the US Supreme Court will work this out.
See Amcast Industrial Corp. v. Detrex Corp. (2
F.3d 746 (7th Cir. 1993)).