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United States v. Taylor

ELR Citation: 26 ELR 20736
Nos. No. 3:89CV00231, 909 F. Supp. 355/(M.D.N.C., 11/28/1995)

The court holds that potentially responsible parties (PRPs) may bring cost recovery actions under §107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) if they incurred necessary response costs. The United States sought to recover cleanup costs under CERCLA from parties that it suspected had generated or transported pesticides disposed of at the Aberdeen Pesticide Superfund site in North Carolina. The court dismissed the government's action against the successor to a railroad, but provided in a case management and scheduling order (CMSO) that other defendants were deemed to have asserted cross-claims against the successor. In April 1995, the court ordered those defendants to file more definite statements of their third-party claims. The third-party plaintiffs asserted claims against the successor relating to contaminants in addition to those the government had identified. The court first holds that the new factual allegations do not exceed the bounds of the court's April 1995 order. The court also finds that delay or prejudice provides no basis for striking the allegations, because discovery will not end until after the trial of the government's claims and the consequences of losing testimony of elderly or deceased witnesses will fall far more heavily on the third-party plaintiffs. In addition, the court can make exceptions to the discovery schedule on good cause shown. The court holds, however, that a more definite statement of facts is due because the April 1995 order asked for more than notice pleading. In accordance with Fed. R. Civ. P. 12(e), the court orders the third-party plaintiffs to identify the contaminants and specify the evidence supporting their claims as to cotton dust and additional pesticides, hazardous substances, commercial relationships, and industry practices purportedly forming the basis of the successor's liability.

The court next holds that the third-party plaintiffs' CERCLA §107 claims against the successor may be stricken under Fed. R. Civ. P. 12(e), because they exceed the bounds of the April 1995 order. Although the court issued the order only after all parties had reviewed it, the third-party plaintiffs never suggested that the cross-claims deemed asserted pursuant to the CMSO included claims under §107. The court also grants the successor's motion to strike the §107 claims pursuant to Fed. R. Civ. P. 12(f), because the third-party plaintiffs fail to state a claim for relief. The court holds that the test as to whether a private party may use §107 does not rest on whether that party is liable or potentially liable. Rather, it depends on whether that party has incurred necessary response costs. Not allowing PRPs to bring §107 actions fails to give due deference to one of the major principles underlying that section—encouraging the voluntary initiation of a cleanup or as part of a settlement with the government. Although some courts have felt that allowing a PRP the benefits of §107's strict liability provisions provides a windfall to a plaintiff who has completed an environmental cleanup, expending resources to clean up a site is not a windfall. Some courts have also expressed fear that PRPs who unilaterally initiate cleanups will run to the courthouse to sue their confederates. But even if PRPs that incur response costs do file complaints, the court retains ample authority to allow the United States to proceed first with its case. Furthermore, the different statutes of limitations in §113(g) support the view that PRPs who clean up and actually incur response costs should be able to use §107 and the corresponding longer limitation period of §113(g)(2). Also, allowing PRPs to use §107 will not unduly or unfairly constrain the government's ability to obtain settlements. The court, however, holds that the third-party plaintiffs have failed to state a claim for relief because they fail to allege that they have incurred necessary response costs as a result of their conducting a cleanup. Finally, the court strikes the third-party plaintiffs' attorney fee allegations as insufficient.

Counsel for Plaintiff
Lawrence W. Puckett
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Counsel for Defendants
L. Neal Ellis Jr., Christopher G. Browning Jr.
Hunton & Williams
One Hannover Sq., 14th Fl., Raleigh NC 27602
(919) 899-3000