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Levin Metals Corp. v. Parr-Richmond Terminal Co.

Citation: 17 ELR 20737
No. No. 86-1927, 817 F.2d 1448/25 ERC 2113/(9th Cir., 05/27/1987) District court's subsequent dismissal aff'd

The court rules that a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) suit to recover investigatory and cleanup costs may not be brought under California law against a corporation that dissolved prior to CERCLA's enactment. Under California CorporationsCode § 2011(a), a shareholder of a dissolved corporation may be sued upon a cause of action against the corporation that arises prior to the corporation's dissolution. Since CERCLA was enacted in 1980, plaintiff's cause of action arose after defendant corporation's dissolution in 1971 and thus cannot be brought pursuant to § 2011(a). The court next holds that California Corporations Code § 2010 does not extend the life of a dissolved corporation so as to enable plaintiff to maintain the suit even though CERCLA was enacted nine years after defendant's dissolution. The court also dismisses plaintiff's argument that, by virtue of CERCLA's retroactivity, the cause of action arose at the time defendant allegedly contaminated the property now owned by plaintiff. The effect of CERCLA's retroactivity is that a cause of action based on preenactment conduct may arise after CERCLA's enactment. Finally, after holding that the district court correctly applied California law pursuant to Federal Rules of Civil Procedure 17(b), the court holds that CERCLA does not preempt California law since the latter determines capacity to be sued and does not limit the imposition of liability.

[Related decisions are published at 15 ELR 20791; 16 ELR 20360, 20954.]

Counsel for Plaintiffs-Appellants
Stephen B. Peck
Hanson, Bridgett, Marcus, Vlahos & Rudy
23rd Fl., 333 Market St., San Francisco CA 94105
(415) 777-3200

Counsel for Defendants-Appellees
Andrew R. Adler
Boornazian, Jensen & Garthe
Suite 1600, 300 Lakeside Dr., P.O. Box 12925, Oakland CA 94604
(415) 834-4350

Before Boochever and Davies, JJ.