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Rockwell Int'l Corp. v. IU Int'l Corp.

Citation: 19 ELR 20908
No. No. 87 C 10609, 702 F. Supp. 1384/29 ERC 1577/(N.D. Ill., 10/27/1988)

The court holds that a government-approved cleanup program is not a prerequisite to a purchaser's private cost recovery action under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) against former owners and operators of a hazardous waste site, and the purchaser may seek declaratory judgments that the former owners and operators are jointly and severally liable for future response costs and are liable for contribution. The purchaser discovered traces of hazardous substances on the site several years after purchase, and was directed by the state to conduct various testing and monitoring procedures. No governmental entity has sought to have the purchaser clean up the site, and no public or private entity has sought reimbursement of response costs. The court first holds that a government-approved cleanup program is not a prerequisite under CERCLA § 107(a) to a private party's action for recovery of monitoring and investigative costs. Section 107 allows for recovery of such costs, and there is no requirement that these costs accompany cleanup costs or that the government first approve them. Moreover, CERCLA anticipates private party actions, and requiring governmental approval would reduce private parties' incentives for responding at a site and to settle with the government quickly. The court next holds that the purchaser may seek declaratory relief as to future response costs. The site contains hazardous wastes, the purchaser has incurred some initial costs in response to the state's order, and the parties potentially responsible for future cleanup have been identified. The court holds that the purchaser may also seek declaratory relief on the issue of contribution under CERCLA § 113(f). Although actual compensation can only be paid if the parties are held liable, there is nothing in § 113(f) or in the concept of contribution prohibiting a plaintiff from seeking a declaratory judgment that a defendant who is held jointly and severally liable should pay contribution if the plaintiff is later held liable. The purposes of CERCLA are served by permitting A declaratory judgment, since it provides an avenue for later determining how liability should be apportioned among the responsible parties, if the purchaser prevails on its claim that the previous owners are jointly and severally liable. The apportionment of liability may provide the parties with an incentive to agree upon an effective and cost-effective plan for cleanup prior to governmental enforcement.

The court holds that the purchaser has identified sufficient evidence from which the trier of fact could reasonably conclude that one of the defendants, the parent corporation of the actual on-site operator, was an operator within the meaning of CERCLA. The parent corporation approved hiring of high-level corporate officers, appointed individuals to be in charge of the facility through several stages of ownership changes, and established procedures for facility operations. Moreover, the parent corporation's auditors reviewed activities at the facility and the parent publicly stated that it operated the facility.

Counsel for Plaintiff
James A. Vroman
Winston & Strawn
Ste. 5000, One First National Plaza, Chicago IL 60603
(312) 558-5600

Jose N. Uranga, Ass't General Counsel
Rockwell International Corporation
2230 E. Imperial Hwy., El Segundo CA 90245
(213) 647-5233

Counsel for Defendants
David E. Bennett
Chadwell & Kaysen
8500 Sears Tower, 233 S. Wacker Dr., Chicago IL 60606-6592
(312) 876-2188