Editors' Summary: The Municipal Settlement Policy, an EPA guidance that addresses CERCLA settlements with municipalities that owned co-disposal landfills or were generators or transporters of waste disposed of at such sites, has been the subject of considerable opposition from industry groups. Although a federal district court rejected a facial challenge to the policy based on EPA's statements that it did not intend to apply it inflexibly, in the first decision examining the policy "as applied" a district court recently rejected the proposed settlement. The extent to which the policy can and should be applied in light of the decision in United States v. AlliedSignal, Inc. is discussed in this Dialogue.