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In re In re Combustion Equip. Assocs., Inc.

ELR Citation: 18 ELR 20494
Nos. No. 87-5022, 838 F.2d 35/27 ERC 1227/(2d Cir., 01/22/1988)

The court holds unripe a suit seeking a declaratory judgment that any liability a debtor might have had under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) was discharged by the firm's declaration of bankruptcy. The court first holds that the Environmental Protection Agency (EPA) has taken no final agency action with respect to the debtor's liability under CERCLA. EPA's letter to the debtor notifying it that it was a potentially responsible party (PRP) under CERCLA §107 was not a final action, since the letter did not impose liability on the debtor or any of the other 190 PRPs. For the same reason, neither the remedial investigation/feasibility study nor the record of decision are final actions. The court next concludes that the ultimate legal arguments are not yet sufficiently established for it to make a determination, since EPA has not made any decision whether to order the debtor to clean up the contaminated sites under CERCLA §106 or whether to clean up the sites itself and seek reimbursement under §107. The court then holds that the debtor has not demonstrated sufficient hardship to require a judicial determination at this time. Although the debtor's operations of its pollution control business may be affected by the possibility of liability, a dispute is not ripe simply because there may be some harm caused by delaying the litigation. Moreover, the debtor could have raised the potential CERCLA liability issue during the bankruptcy proceeding, since the bankruptcy court has authority to estimate and discharge contingent liabilities. Finally, the hardship to EPA's CERCLA cleanup program could be severe if PRPs were allowed to challenge EPA at such a preliminary stage.

Counsel for Plaintiff-Appellant
Roy Babitt
Anderson, Russell, Peale & Olick
666 3rd Ave., New York NY 10017
(212) 850-0738

Counsel for Defendants-Appellees
Richard M. Swartz, Ass't U.S. Attorney
One St. Andrews Plaza, New York NY 10007
(212) 791-0053

Before Oakes and Pratt, JJ.