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United States v. Davis

Citation: 29 ELR 20441
(12/15/1998)

The court allocates the liability for future cleanup costs at a hazardous waste site among potentially responsible parties (PRPs). Pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the government commenced a suit against sought eight PRPs to recover the cleanup costs incurred at a hazardous waste landfill. One of these PRPs asserted claims for contribution and indemnity against several co-defendants and 138 third-and fourth-party defendants. Having settled with the government, the original PRP seeks a declaratory judgment allocating responsibility for future cleanup costs among 15 defendants that did not settle. The court first holds that a declaratory judgment is an appropriate method of allocating liability. The apportionment of liability among the litigants presents a real and substantial controversy that satisfies the Declaratory Judgment Act's requirements.

The court next holds that the PRP and several defendants share common liability for future response costs. Under CERCLA, the site is a facility, hazardous substances were released, and response costs were incurred. In addition, two of the defendants, a husband and wife that owned the site, are liable as CERCLA § 107(a)(1) owners, and the husband is also liable as a CERCLA § 107(a)(1) operator. There is also no question that three of the defendants are liable as transporters under CERCLA § 107(a)(4), but there is no evidence that one defendant transported any waste to the site and another defendant previously was found not liable as a transporter. Furthermore, five of the defendants are liable as arrangers under CERCLA § 107(a)(3). The PRP, however, failed to prove that one of the defendants is an arranger.

The court then holds that in allocating liability among the parties it will consider the extent to which cleanup costs are attributable to waste for which the party is responsible, the party's level of culpability, the degree to which the party benefitted from the waste disposal, and the party's ability to pay. The court rejects the defendants' argument that the per capita approach should be used to allocate liability. The court next calculates the equitable shares of liability for each party. Although the site owners and one transporter will be unable to pay the portion of response costs attributable to them, the generators can absorb the response costs attributable to the hazardous waste they produced. Therefore, the court allocates all of the response costs shared by the generators, owners, and one transporter to the generators. Each generator's equitable share is equal to the percentage of the total volume of hazardous waste deposited at the site that the particular generator produced. Responsibility for the remaining hazardous waste produced by arrangers and generators other than the PRP and the defendants must be allocated between the transporters of that waste and the site owners. Since the husband exercised complete control over the manner of disposal and was most intimately familiar with its effects, 64 percent of the liability for the response costs attributable to the remaining waste is allocated to him. One percent is allocated to the wife, and the remaining 35 percent is allocated to the transporters in proportion to the quantities of waste they transported.

The court further holds that the insolvency of the site owners and the transporters does not require that the liability allocated to them be treated as orphan shares. The responsibility for quantities of waste not attributable to the generator defendants is shared by the site owners, the transporters, and the generators of that waste. The PRP, however, failed to prove that the site owners, the transporters, or the generators of that waste are unknown or insolvent. In addition, it would be inequitable to shift the burden of the costs associated with the hazardous waste in question to the generator defendants that have no connection to it. Moreover, allocating liability for which settling parties are responsible could result in the kind of double recovery prohibited by CERCLA § 114. Last, the court holds that the PRP has established a likelihood that it will be entitled to future contribution.

[Prior decisions in this litigation are published at 28 ELR 21412 and 29 ELR 20436.]

Counsel for Plaintiff
Everett C. Sammartino
U.S. Attorney's Office
Westminster Sq., Bldg. 10
10 Dorrance St., 10th FL, Providence RI 02903
(401) 528-5477

Counsel for Defendants
Thomas C. Angelone
Hodosh, Spinella & Angelone
Shakespeare Hall
128 Dorrance St., Ste. 450, Providence RI 02901
(401) 274-0200