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Minnesota v. Kalman W. Abrams Metals, Inc.

ELR Citation: 29 ELR 20088
Nos. 97-3545, 155 F.3d 1019/(8th Cir., 09/17/1998)

The court holds that a state may only recover from responsible private parties the nonarbitrary portions of response costs it incurred cleaning up lead-contaminated soils under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the Minnesota Environmental Response and Liability Act (MERLA). The court first holds that it has appellate jurisdiction even though the district court's summary judgment orders did not resolve claims against a settling party and did not resolve pending claims among the nonsettling responsible parties. Although the consent decree between the state and the settling party was not entered until after the orders were issued, final approval of the settlement was the kind of ministerial task that does not defeat finality. Moreover, the district court's orders granting summary judgment contain the requisite clear and unequivocal manifestation of the court's belief that it ended the case. The responsible parties' cross-claims, counterclaims, and third-party claims were contingent on their being liable to the state. Thus, the district court did not address those claims when it granted summary judgment in favor of the nonsettling responsible parties. This did not affect the finality of the district court's last summary judgment order or the court's appellate jurisdiction.

The court next holds that the state incurred costs inconsistent with the national contingency plan (NCP). The permanent nature of the site cleanup and the leisurely manner in which the state dealt with the problem make it appropriate to hold the state to NCP standards for remedial action. Further, the administrative record supports the conclusion that the cleanup was conducted in an arbitrary and capricious manner. However, the court then holds that the remedial action to clean up the site was appropriate under CERCLA. Therefore, the state may recover all costs except those that the responsible parties prove were inconsistent with the NCP. The district court erred in concluding that the state's arbitrary and capricious actions during one portion of the cleanup completely bar the state from recovering all costs incurred. The court further holds that, on remand, the state may not recover response costs incurred in implementing appropriate remedial actions to the extent that the responsible parties prove that they would have and could have accomplished the cleanup more cost effectively. As for claims brought under MERLA, the court holds that on remand, the state will not be entitled to any greater recovery for its response actions under MERLA than under CERCLA.

Last, the court holds that the district court properly dismissed the state's claim against a dissolved company because the state did not timely initiate legal, administrative, or arbitration proceedings. Although the state's request for information from and a letter to the company were preliminary steps in the MERLA enforcement process, they were not the initiation of the kind of formal proceedings state regulations require creditors to commence in order to avoid the normal consequences of corporate dissolution.

Counsel for Plaintiff
Janette K. Brimmer, Ass't Attorney General
Attorney General's Office
102 State Capitol St., St. Paul MN 55155
(612) 296-6196

Counsel for Defendants
Scott G. Bowman
Briggs & Morgan
2400 IDS Center
80 S. 8th St., Minneapolis MN 55402
(612) 334-8400

Before Bowman and Heaney, JJ.