Insurance Coverage for Superfund Liability Defense and Cleanup Costs: The Need for a Nonlitigation Approach
Despite numerous changes made in the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund)1 by the Superfund Amendments and Reauthorization Act of 1986 (SARA),2 the two years of experience with its implementation seem to have produced few improvements in the settlement or litigation process. New cleanup standards are not only driving up the costs of remedial action, but are also delaying further the process of site cleanup by increasing the number of issues that are being litigated. Considering the number and types of sites that are likely to be listed on the National Priorities List in years to come—huge urban landfills used by hundreds or even thousands of potentially responsible parties (PRPs) for decades—it is disappointing that Congress did not do more to encourage both PRPs and the government to use nonlitigative means to resolve their disputes.
Indeed, there was overwhelming evidence from early Superfund cases that it was already costing as much if not more to litigate the issues of liability and the nature of the remedy as it was to do the actual cleanup. For example, the PRPs at the Ottati & Goss site in New Hampshire have spent in the range of $6-20 million to litigate a remedy that is currently estimated to cost about $15 million to implement. If the cost of site cleanups triples or quadruples, as SARA seems to contemplate, more litigation is sure to follow, wasting valuable resources better spent on improving the condition of the environment.