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Basic Management, Inc. v. United States

ELR Citation: 38 ELR 20073
Nos. No. 2:02-0884, (D. Nev., 02/25/2008)

A district court granted in part and dismissed in part a motion to dismiss the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) §§107 and 104 claims. In the present case, the parent company at issue had overlapping directors, managers, and employees with its subsidiary and was involved in the daily operations of the subsidiary beyond the norms of parental supervision to a sufficient degree to hold the parent liable as an "operator" under CERCLA. In addition, the same facts are sufficient to hold the parent liable as an "arranger," but are insufficient to pierce the corporate veil and impose derivative liability. "Arranger" liability also attaches to the U.S. government defendants in this case. Because plaintiff purchased insurance policies that cover the remediation costs in question, plaintiff is not "incurring" costs under CERCLA unless it has or will actually incur the specific cost for which it seeks contribution. In addition, CERCLA §114 prohibits plaintiffs from recovering costs paid by its insurers because to award such costs would result in a double recovery for the plaintiffs. The collateral source rule has no application in this instance because this is not an action in tort under which plaintiffs are entitled to damages but an environmental action addressing reimbursement.