United States v. Atlantic Research Corporation 127 S. Ct. 2331 (2007)
Atlantic leased property belonging to the Dept. of Defense
and used the site to retrofit rocket motors for the US military. Some of
the rocket fuel leaked, and the entire site became a hazardous waste area.
Realizing that they would be held liable for cleanup costs
under CERCLA, Atlantic cleaned up the site at their own expense.
They then sued the Dept. of Defense to recover the cleanup costs under CERCLA
§107(a) and §113(f).
CERCLA §107(a) says that owners of contaminated
sites can be held liable for cleanup costs.
CERCLA §113(f) says that any person may seek
contribution from any other person who is liable or potentially liable
The Trial Court dismissed the case. Atlantic appealed.
The Trial Court relied on the decision in Cooper
Industries, Inc. v. Aviall Services, Inc. (543 U.S. 157 (2004)),
which basically said that one potentially responsible party (PRP), cannot
sue another to recover costs.
Based on a reading of §107(a)(4)(A).
The Appellate Court reversed. The Dept. of Defense
The Appellate Court found that §107(a)(4)(B)
authorized a suit by any person not permitted to sue under §107(a)(4)(A).
The Appellate Court interpreted §107(a)(4)(B) to
say that any PRP associated with a facility from which there is a
release...shall be liable for...any necessary costs of response incurred
by any other person...
The Dept. of Defense argued that §107(a)(4)(B)
permits suits only by non-PRPs.
The US Supreme Court affirmed.
The US Supreme Court found that a plain reading of §107(a)(4)(B)
allowed a PRP to recover costs from other PRPs. Therefore Atlantic had a
cause of action.
The Court found that §107(a)(4)(B) provides a
cause of action to anyone except the persons listed in §107(a)(4)(A).
The Dept. of Defense argued that this interpretation
would offer PRPs a choice between §107(a)(4)(B) and §113(f),
effectively allowing PRPs to circumvent §113(f)'s shorter Statute
of Limitations, and encourages PRPs to forgo the equitable apportionment
of §113(f) and instead try to get out of paying completely by
using §107(a)(4)(B)'sjoint and several liability.
The Court rejected this argument, saying that if one PRP
makes a §107(a)(4)(B) claim, the other PRP can always make a §113(f)
counterclaim, and the court can decide if equitable apportionment or
joint and several liability is the appropriate remedy.
One bonus to suing under §107(a)(4)(B) is that you
can argue that the defendant should be held jointly and severally liable,
and stick them with the entire bill. Under §113(f) you can only
sue for equitable contribution, so the most the defendant will have to pay
is just an equitable share of the costs.